UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

 

Date of Report (Date of earliest event reported):   April 28, 2005

 

 

SUPERIOR ENERGY SERVICES, INC.

(Exact name of registrant as specified in its charter)

 

 

Delaware (State or other jurisdiction)

0-20310 (Commission File Number)

75-2379388 (IRS Employer Identification No.)

 

 

1105 Peters Road, Harvey, Louisiana (Address of principal executive offices)

70058 (Zip Code)

 

 

 

(504) 362-4321

(Registrant's telephone number, including area code)

 

 

 

Item 2.02.

Results of Operations and Financial Condition.

On April 28, 2005, Superior Energy Services, Inc. issued a press release announcing its earnings for the first quarter ended March 31, 2005. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. In accordance with General Instruction B.2. of Form 8-K, the information presented herein shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

 

 

 

Item 9.01

Financial Statements and Exhibits.

(c)	Exhibits:
	99.1	Press release issued by Superior Energy Services, Inc., dated April 28, 2005.

 

 

SIGNATURES

            Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	SUPERIOR ENERGY SERVICES, INC.
	By:	/s/ Robert S. Taylor
		Robert S. Taylor
		Chief Financial Officer

 

Dated:    April 29, 2005

	EXHIBIT  99.1
	1105 Peters Road  Harvey, Louisiana 70058 (504) 362-4321 Fax  (504) 362-4966 NYSE: SPN

FOR IMMEDIATE RELEASE

FOR FURTHER INFORMATION CONTACT: Terence Hall, CEO; Robert Taylor, CFO; Greg Rosenstein, VP of Investor Relations, 504-362-4321

Superior Energy Services, Inc. Announces Record First Quarter 2005 Results

(Harvey, La., Thursday, April 28, 2005) Superior Energy Services, Inc. (NYSE: SPN) today announced record results for the first quarter ended March 31, 2005. For the quarter, revenues were $173.2 million resulting in net income of $17.2 million or $0.22 diluted earnings per share, as compared to revenues of $116.5 million and net income of $3.6 million or $0.05 diluted earnings per share for the first quarter of 2004.

President and CEO Terry Hall Comments

President and CEO Terry Hall commented, "The first quarter of 2005 was the best in our company's history as a result of strong production-related activity for our well intervention services in the Gulf of Mexico, another record quarter for our rental tools segment and significantly higher oil and gas production. The company established quarterly records for revenue, operating income and net income.

"Activity increased for our core Gulf of Mexico-based well intervention services as compared to the first and fourth quarters of 2004. Our strategy of working on our own properties helped increase utilization early in the quarter. As the period progressed, demand from our traditional customers gradually increased. The reported well intervention segment revenues and operating income were lower sequentially due primarily to less work associated with a large well control project that positively impacted the fourth quarter of 2004.

"Our rental tools business continues to grow both domestically on land and internationally in the North Sea and West Africa. In addition, the deepwater Gulf of Mexico market improved. These factors contributed to our record performance.

"It is evident that the Gulf of Mexico market is at a much different point in the industry cycle when you compare this quarter's results from our well intervention, rental tool and marine segments to the first quarter results of last year. We believe activity in these core product and service segments should continue to improve as we enter the traditional busy season for Gulf of Mexico well intervention work and continue to grow our rental tools business."

Well Intervention Group Segment

First quarter revenues for the Well Intervention Group were $58.3 million, a 44% increase from the first quarter of 2004 and a 7% decrease from the fourth quarter of 2004. As compared to the fourth quarter of 2004, revenues were lower due to the completion of the well-capping portion of a well control project in Egypt. This was partially offset by increased production-related work for the company's coiled tubing, gas lift, electric line, hydraulic workover, mechanical wireline, and pumping and stimulation services.

Rental Tools Segment

Revenues for the Rental Tools segment were a record $52.6 million, 36% higher than the first quarter of 2004, and 17% higher than the fourth quarter of 2004. The primary factors leading to the record quarter were increased rentals of stabilizers, drill pipe and other tubular products internationally in the North Sea and West Africa and domestically in Texas, Wyoming and in the deepwater Gulf of Mexico, and increased demand for onsite bolting and machining services.

Marine Segment

Superior's marine revenues were $19.8 million, a 45% increase as compared to the first quarter of 2004 and a 3% decrease as compared to the fourth quarter of 2004. Average fleet utilization was 77% as compared to 64% in the first quarter of 2004 and 76% in the fourth quarter of 2004. Average daily revenue in the first quarter was approximately $220,000, inclusive of subsistence revenue.

Sequentially, the Company's mid-sized classes (145-175 ft. classes) posted stronger results due to an increase in production-related activity in the shallow water Gulf of Mexico. Lower utilization in the 230-245 ft. class was due in part to significant downtime for the 230-foot Superior Champion, which suffered leg damage and spent more than 50% of the quarter in the shipyard for repairs. The Champion is expected to return to service in May.

Liftboat Average Dayrates and Utilization by Class Size

Three Months Ended March 31, 2005

($ actual)

 

Class		Liftboats		Average Dayrate		Utilization
105'		5		$3,297		77.8%
120-135'		8		3,473		81.0%
145-155'		11		5,516		75.3%
160'-175'		6		7,475		80.2%
200'		3		10,976		75.9%
230'-245'		3		14,895		70.0%
250'		2		20,305		76.1%

Other Oilfield Services Segment

Revenues in this segment were $21.8 million, a 10% increase as compared to the first quarter of 2004 and a 5% increase as compared to the fourth quarter of 2004. The sequential improvement was due primarily to increased activity for waste disposal and contract operations.

Oil and Gas Segment

Oil and gas revenues were $26.0 million as compared to $4.7 million in the first quarter of 2004 and $11.5 million in the fourth quarter of 2004. First quarter production from SPN Resources was approximately 600,500 barrels of oil equivalent, net (boe) as compared to approximately 131,100 net boe in the first quarter of 2004 and 289,400 net boe in the fourth quarter of 2004. On a sequential basis, first quarter production was higher due to the resumption of production from South Pass 60 following post-Hurricane Ivan repairs and incremental production from West Delta 79/86 field acquired in December 2004.

Superior Signs Definitive Agreements to Build an 880-ton Derrick Barge

The Company announced today it signed definitive agreements to construct a new-build 880-ton derrick barge to support its operations on the outer continental shelf. The contracts are for the construction of a 350-foot barge and crane for a fixed price of approximately $22.0 million. The ABS-class and SOLAS-rated barge will accommodate 200 people and is expected to be available in the Gulf of Mexico late in the third quarter of 2006.

The company intends to utilize the purpose-built derrick barge to remove platforms and structures owned by its subsidiary, SPN Resources LLC, and compete in the Gulf of Mexico construction market for both installation and removal projects.

"Adding a derrick barge is a natural extension of our plug and abandonment and decommissioning asset base," Hall said. "The derrick barge allows us to build upon our strong brand name in the well abandonment business and become a full service decommissioning provider. Also, we can further internalize and control decommissioning costs associated with our SPN Resources-owned platform and structure removals, giving us a hedge against derrick barge availability and rates going forward."

The Company will host a conference call at 11 a.m. Central Time on Friday, April 29. The call can be accessed from Superior's website at www.superiorenergy.com, or by telephone at 800-763-5557. The replay telephone number is 800-642-1687 and the replay passcode is 5617979. The replay is available beginning two hours after the call and ending May 6, 2005.

Superior Energy Services, Inc. is a leading provider of specialized oilfield services and equipment focused on serving the production-related needs of oil and gas companies primarily in the Gulf of Mexico and the drilling-related needs of oil and gas companies in the Gulf of Mexico and select international market areas. The company uses its production-related assets to enhance, maintain and extend production and, at the end of an offshore property's economic life, plug and decommission wells. Superior also owns and operates mature oil and gas properties in the Gulf of Mexico.

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 which involve known and unknown risks, uncertainties and other factors. Among the factors that could cause actual results to differ materially are: volatility of the oil and gas industry, including the level of exploration, production and development activity; risks associated with the Company's rapid growth; changes in competitive factors and other material factors that are described from time to time in the Company's filings with the Securities and Exchange Commission. Actual events, circumstances, effects and results may be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Consequently, the forward-looking statements contained herein should not be regarded as representations by Superior or any other person that the projected outcomes can or will be achieved.

# # #

 

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SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

Three Months Ended March 31, 2005 and 2004

(in thousands, except earnings per share amounts)

(unaudited, except as noted)

 

 

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SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

MARCH 31, 2005 AND DECEMBER 31, 2004

(in thousands)

 

 

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Superior Energy Services, Inc. and Subsidiaries

Segment Highlights

Three months ended March 31, 2005, December 31, 2004 and March 31, 2004

(Unaudited)

(in thousands)

 

 

	Three months ended,
Revenue	March 31, 2005			December 31, 2004			March 31, 2004
Well Intervention	$	58,335		$	62,779		$	40,631
Rental tools		52,627			44,971			38,732
Marine		19,798			20,456			13,611
Other Oilfield Services		21,781			20,789			19,858
Oil and Gas		25,955			11,462			4,703
Less: Oil and Gas Eliminations (2)		(5,249)			(2,622)			(1,076)
Total Revenues	$	173,247		$	157,835		$	116,459
	Three months ended,
Gross Profit (1)	March 31, 2005			December 31, 2004			March 31, 2004
Well Intervention	$	26,337		$	29,154		$	16,663
Rental tools		35,093			29,731			26,119
Marine		7,868			7,357			1,982
Other Oilfield Services		4,381			4,560			2,729
Oil and Gas		13,150			3,185			2,261
Total Gross Profit	$	86,829		$	73,987		$	49,754

 

(1)	Gross profit is calculated by subtracting cost of services from revenue for each of the Company's five segments.
(2)	Oil and gas eliminations represent products and services from the company's segments provided to the Oil and Gas Segment.