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): November 4, 2003
SUPERIOR ENERGY SERVICES, INC.
(Exact name of registrant as specified in its charter)
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Delaware (State or other jurisdiction of incorporation) |
0-20310 (Commission File Number) |
75-2379388 (IRS Employer Identification No.) |
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1105 Peters Road, Harvey, Louisiana (Address of principal executive offices) |
70058 (Zip Code) |
(504) 362-4321
(Registrant's telephone number, including area code)
Item 5. Other Events.
On November 4, 2003, Superior Energy Services, Inc. issued the press release attached hereto as Exhibit 99.
Item 7. Financial Statements and Exhibits.
(a) Exhibits.
| 99 | Press release issued by Superior Energy Services, Inc. on November 4, 2003, announcing results for the third quarter ended September 30, 2003. |
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.
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SUPERIOR ENERGY SERVICES, INC. |
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By: |
/s/ Robert S. Taylor |
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Robert S. Taylor |
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Chief Financial Officer |
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Dated: November 4, 2003
Exhibit 99
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 Third Quarter 2003 Results
(Harvey, La., Tuesday, November 4, 2003) Superior Energy Services, Inc. (NYSE: SPN) today announced results for the third quarter ended September 30, 2003. For the quarter, revenues were $128.3 million resulting in net income of $8.8 million or $0.12 diluted earnings per share, as compared to revenues of $107.2 million and net income of $1.9 million or $0.03 diluted earnings per share for the third quarter of 2002.
For the nine months ended September 30, 2003, revenues were
$380.4 million and net income was $24.7 million or $0.33 diluted earnings per
share, as compared to revenues of $324.8 million and net income of $16.3 million
or $0.22 diluted earnings per share for the nine months ended September 30,
2002.
President and CEO Terry Hall Comments
President and CEO Terry Hall commented, "Demand for production-related services increased, resulting in higher revenue and gross profits in our Well Intervention segment as compared to the second quarter of this year. However, this was offset by decreases in drilling-related activity, which impacted our drilling-related rental tools and environmental services businesses. In our Marine segment, increases in production-related work were more than offset by higher-than-anticipated downtime due to weather and the loss of the 200-foot class Superior Challenge. The opportunity cost associated with losing the Challenge is high as it operated in our most highly utilized liftboat class.
"We do not expect much change in Gulf of Mexico activity in
the near term. Longer term, we believe our focus on production enhancement will
continue to benefit operators in both the shallow water and deepwater Gulf, as
well as international operators as we continue to expand our geographic reach."
Well Intervention Group Segment
Third quarter revenues for the Well Intervention Group were
$50.3 million, an 39 percent increase from the third quarter of 2002 and an 8
percent increase from the second quarter of 2003. Most well intervention
activity increased due to rising demand for production-related services in the
shallow water Gulf of Mexico. On a sequential basis, activity increased in
coiled tubing, hydraulic workover, mechanical wireline and well control
services, which were offset by decreases in plug and abandonment and electric
line services.
Rental Tools Segment
Revenues for the Rental Tools segment were $35.4 million, 20
percent higher than the third quarter of 2002 and 3 percent lower than the
second quarter of 2003. Rental activity was lower sequentially as a result of
lower drilling and completion activity and changes in timing on certain
deepwater Gulf of Mexico projects, which resulted in fewer rentals of drill
pipe, stabilizers and related equipment.
Marine Segment
Superior's marine revenues were $17.3 million, a 20 percent increase as compared to the third quarter of 2002 and a 7 percent decrease as compared to the second quarter of 2003. Average fleet utilization was 66 percent as compared to 63 percent for the third quarter of 2002 and 66 percent for the second quarter of 2003.
Although production-related activity increased --a primary
driver of liftboat activity --the segment was adversely impacted by the loss of
the 200-foot class Superior Challenge and the unusually high number of weather
downtime days due to multiple tropical storm systems in the Gulf of Mexico. The
200-foot class Superior Challenge liftboat sunk on June 30 due to a tropical
storm. The Company recorded a gain from insurance proceeds of $2.8 million in
other income.
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Liftboat Average Dayrates and Utilization by Class Size |
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Three Months Ended September 30, 2003 |
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($ actual) |
| Class | Liftboats | Average Dayrate | Utilization | ||||
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105' |
8 |
$2,866 |
55.6% |
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120-135' |
9 |
3,399 |
66.6% |
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145-155' |
11 |
5,080 |
61.7% |
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160'-175' |
6 |
7,047 |
74.1% |
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200' |
2 |
10,439 |
95.7% |
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230'-245' |
3 |
11,820 |
69.6% |
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250' |
2 |
17,609 |
72.8% |
Other Oilfield Services Segment
Revenues in this segment were $25.4 million, a 7 percent decrease as compared to the third quarter of 2002 and an 8 percent decrease as compared to the second quarter of 2003. Lower revenue is attributable to the sale of the Company's construction division and lower activity for drilling-related environmental services such as non-hazardous oilfield waste treatment.
During the quarter, the Company sold its construction-related assets for $1.25 million. There was no gain or loss recorded on the sale.
The Company will host a conference call at 10:30 a.m. Central Time today. 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 3306581. The replay is available beginning two hours after the call and ending November 11, 2003.
Superior Energy Services, Inc. provides a broad range of specialized oilfield services and equipment primarily to major and independent oil and gas companies engaged in the exploration, production and development of oil and natural gas properties offshore in the Gulf of Mexico and throughout the Gulf Coast region. These services and equipment include the rental of liftboats, rental of specialized oilfield equipment, electric and mechanical wireline services, well plug and abandonment services, well control, coiled tubing services and engineering services. Additional services provided include contract operating and supplemental labor, offshore construction and maintenance services, offshore and dockside environmental cleaning services, the manufacture and sale of drilling instrumentation and the manufacture and sale of oil spill containment equipment.
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 and Nine Months Ended September 30, 2003 and 2002
(in thousands, except earnings per share amounts)
(unaudited)
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Three Months Ended |
Nine Months Ended |
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September 30, |
September 30, |
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2003 |
2002 |
2003 |
2002 |
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Revenues |
$ 128,316 |
$ 107,213 |
$ 380,368 |
$ 324,769 |
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Costs and expenses: |
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Cost of services |
75,449 |
67,136 |
219,897 |
188,514 |
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Depreciation and amortization |
12,174 |
10,295 |
36,001 |
30,273 |
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General and administrative |
24,195 |
21,279 |
71,573 |
63,918 |
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Total costs and expenses |
111,818 |
98,710 |
327,471 |
282,705 |
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Income from operations |
16,498 |
8,503 |
52,897 |
42,064 |
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Other income (expense): |
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Interest expense, net |
(5,611) |
(5,452) |
(16,693) |
(15,857) |
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Other income |
2,762 |
- |
2,762 |
- |
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Equity in income of affiliates |
60 |
113 |
492 |
258 |
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Income before income taxes |
13,709 |
3,164 |
39,458 |
26,465 |
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Income taxes |
4,883 |
1,218 |
14,797 |
10,189 |
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Net income |
$ 8,826 |
$ 1,946 |
$ 24,661 |
$ 16,276 |
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Basic earnings per share |
$ 0.12 |
$ 0.03 |
$ 0.33 |
$ 0.22 |
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Diluted earnings per share |
$ 0.12 |
$ 0.03 |
$ 0.33 |
$ 0.22 |
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Weighted average common shares used |
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in computing earnings per share: |
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Basic |
74,035 |
73,765 |
73,933 |
72,615 |
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Diluted |
75,169 |
74,543 |
74,952 |
73,634 |
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SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2003 AND DECEMBER 31, 2002
(in thousands)
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9/30/2003 |
12/31/2002 |
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(Unaudited) |
(Audited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
$ 20,732 |
$ 3,480 |
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Accounts receivable - net |
117,204 |
108,352 |
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Income taxes receivable |
- |
6,087 |
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Prepaid insurance and other |
15,807 |
11,663 |
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Total current assets |
153,743 |
129,582 |
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Property, plant and equipment - net |
425,070 |
418,047 |
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Goodwill - net |
202,305 |
160,366 |
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Investments in affiliates |
12,772 |
12,343 |
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Other assets - net |
7,429 |
7,282 |
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Total assets |
$ 801,319 |
$ 727,620 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities: |
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Accounts payable |
$ 20,306 |
$ 21,010 |
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Accrued expenses |
61,273 |
33,871 |
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Income taxes payable |
1,401 |
- |
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Current maturities of long-term debt |
14,210 |
13,730 |
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Total current liabilities |
97,190 |
68,611 |
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Deferred income taxes |
82,755 |
67,333 |
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Long-term debt |
259,271 |
256,334 |
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Total stockholders' equity |
362,103 |
335,342 |
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Total liabilities and stockholders' equity |
$ 801,319 |
$ 727,620 |
Superior Energy Services, Inc. and Subsidiaries
Segment Highlights
Three months ended September 30, 2003 and 2002
(Unaudited)
(in thousands)
| Revenue |
September 2003 |
September 2002 |
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| Well Intervention Group |
$ 50,264 |
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$ 36,115 |
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| Marine |
17,260 |
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14,326 |
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| Rental Tools |
35,351 |
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29,401 |
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| Other Oilfield Services |
25,441 |
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27,371 |
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| Total |
$ 128,316 |
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$ 107,213 |
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| Gross Profit (1) |
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| Well Intervention Group |
$ 20,453 |
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$ 11,701 |
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| Marine |
4,817 |
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2,870 |
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| Rental Tools |
23,842 |
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20,028 |
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| Other Oilfield Services |
3,755 |
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5,478 |
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| Total |
$ 52,867 |
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$ 40,077 |
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(1) |
Gross profit is calculated by subtracting cost of services from revenue for each of the Company's four segments. |