SEACOR Marine Announces Third Quarter 2019 Results
As a result of the announcement of the pending sale of its North Sea Standby Safety business on
Third quarter highlights from continuing operations include:
- Total operating revenues from continuing operation increased 4% to
$54.7 million from$52.8 million in the second quarter of 2019, primarily due to lower drydocking days in the U.S. and higher contributions from the Company’s international liftboats. Utilization increased 5% from the second quarter 2019 primarily due to a decrease in the number of available days as a result of asset sales during the last twelve months. Operating loss decreased to$6.0 million from$18.8 million in the second quarter of 2019.
- Consolidated direct vessel profit (“DVP”)(1) for the third quarter of 2019 increased by
$10.1 million , or 58%, to$27.5 million from$17.4 million in the second quarter of 2019. All regions experienced DVP improvement.
- Average dayrates, excluding the CTV fleet, increased to
$10,946 from$10,387 in the second quarter of 2019. This is the highest average dayrate the Company has experienced since the first quarter of 2016.
- Wind energy support revenues for the third quarter of 2019 increased by
$1.4 million to $11.9 million from$10.5 million in the second quarter of 2019, a 14% increase, and DVP for this activity increased by$2.5 million to $6.9 million from$4.4 million in the second quarter of 2019, a 56% increase. This growth included both organic improvement in utilization and average dayrates for the CTV fleet and the full quarter contribution of a multi-year contract inEurope for one liftboat.
- The third quarter results include one-time restructuring charges of
$3.3 million arising from the Company’s continuing cost reduction initiatives. During the third quarter of 2019, the Company implemented initiatives providing$4.6 million in annualized recurring administrative and general savings and maintained its target of projected annual savings of at least$8.0 million . The Company anticipates that the initiatives will impact all of its reportable segments and expects the bulk of the initiatives to be completed by the second quarter of 2020.
Chief Executive Officer
“I am pleased with our performance during the third quarter of 2019, which saw the highest direct vessel profit (“DVP”) and utilization from continuing operations since the fourth quarter of 2014. This improved margin reflects the strategic positioning and high grading of our fleet worldwide. We continued to implement our aggressive cost-cutting initiative and have already achieved more than 50% of our annualized target savings, and expect full implementation by mid 2020.
“Consistent with our strategy of reducing costs, we are actively identifying opportunities to optimize our regional footprint and are focusing our resources on core assets, regions and services with the highest earning potential. This past quarter we announced the sale of our
For the third quarter of 2019, net loss attributable to SEACOR Marine’s continuing operations was
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| (1 | ) | Direct vessel profit (defined as operating revenues less operating costs and expenses, “DVP”) is the Company’s measure of segment profitability when applied to reportable segments and a non-GAAP measure when applied to individual vessels, fleet categories or the combined fleet. DVP is a critical financial measure used by the Company to analyze and compare the operating performance of its individual vessels, fleet categories, regions and combined fleet, without regard to financing decisions (depreciation for owned vessels vs. leased-in expense for leased-in vessels). DVP is also useful when comparing the Company’s fleet performance against those of our competitors who may have differing fleet financing structures. DVP has material limitations as an analytical tool in that it does not reflect all of the costs associated with the ownership and operation of our fleet, and it should not be considered in isolation or used as a substitute for our results as reported under GAAP. See page 8 for reconciliation of DVP to GAAP Operating Income (Loss), its most comparable GAAP measure. |
Certain statements discussed in this release as well as in other reports, materials and oral statements that the Company releases from time to time to the public constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “believe,” “plan,” “target,” “forecast” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements concern management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by the management of the Company. These statements are not guarantees of future performance and actual events or results may differ significantly from these statements. Actual events or results are subject to significant known and unknown risks, uncertainties and other important factors, many of which are beyond the Company’s control. It should be understood that it is not possible to predict or identify all such factors. Consequently, the preceding should not be considered to be a complete discussion of all potential risks or uncertainties. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its filings with the
Please visit SEACOR Marine’s website at www.seacormarine.com for additional information.
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| SEACOR MARINE HOLDINGS INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF LOSS (in thousands, except share data) |
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| Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2019 | 2018 | 2019 | 2018 | |||||||||||||
| Operating Revenues | $ | 54,700 | $ | 58,169 | $ | 152,422 | $ | 144,670 | ||||||||
| Costs and Expenses: | ||||||||||||||||
| Operating | 27,211 | 38,400 | 97,747 | 99,839 | ||||||||||||
| Administrative and general | 12,509 | 11,767 | 36,148 | 39,182 | ||||||||||||
| Lease expense | 4,171 | 3,292 | 12,636 | 9,881 | ||||||||||||
| Depreciation and amortization | 16,091 | 16,397 | 48,600 | 52,940 | ||||||||||||
| 59,982 | 69,856 | 195,131 | 201,842 | |||||||||||||
| Gain (loss) on Asset Dispositions and Impairments, Net | 861 | (1,765 | ) | (2,719 | ) | (3,493 | ) | |||||||||
| Operating Loss | (4,421 | ) | (13,452 | ) | (45,428 | ) | (60,665 | ) | ||||||||
| Other Income (Expense): | ||||||||||||||||
| Interest income | $ | 317 | 305 | 886 | 869 | |||||||||||
| Interest expense | (7,362 | ) | (7,660 | ) | (22,659 | ) | (20,077 | ) | ||||||||
| SEACOR Holdings guarantee fees | (26 | ) | (5 | ) | (87 | ) | (24 | ) | ||||||||
| Loss on Debt Extinguishment | — | (638 | ) | — | (638 | ) | ||||||||||
| Derivative (gains) losses, net | 3,057 | 4,387 | 734 | (9,797 | ) | |||||||||||
| Foreign currency gains, net | (370 | ) | (296 | ) | (624 | ) | (967 | ) | ||||||||
| Other, net | — | 678 | — | 678 | ||||||||||||
| (4,384 | ) | (3,229 | ) | (21,750 | ) | (29,956 | ) | |||||||||
| Loss from Continuing Operations Before Income Tax Benefit and Equity in Earnings of 50% or Less Owned Companies | (8,805 | ) | (16,681 | ) | (67,178 | ) | (90,621 | ) | ||||||||
| Income Tax Expense (Benefit) | 1,277 | 1,248 | (5,606 | ) | (13,304 | ) | ||||||||||
| Loss from Continuing Operations Before Equity in Earnings of 50% or Less Owned Companies | (10,082 | ) | (17,929 | ) | (61,572 | ) | (77,317 | ) | ||||||||
| Equity in Losses of 50% or Less Owned Companies | (1,325 | ) | (1,022 | ) | (11,879 | ) | (1,734 | ) | ||||||||
| Loss from Continuing Operations | (11,407 | ) | (18,951 | ) | (73,451 | ) | (79,051 | ) | ||||||||
| (Loss) Income on Discontinued Operations, Net of Tax | (6,834 | ) | 3,185 | (3,327 | ) | 4,968 | ||||||||||
| Net Loss | (18,241 | ) | (15,766 | ) | (76,778 | ) | (74,083 | ) | ||||||||
| Net Income (Loss) attributable to Noncontrolling Interests in Subsidiaries | 204 | 191 | (4,395 | ) | (4,269 | ) | ||||||||||
| Net Loss attributable to SEACOR Marine Holdings Inc. | $ | (18,445 | ) | $ | (15,957 | ) | $ | (72,383 | ) | $ | (69,814 | ) | ||||
| Basic and Diluted Income (Loss) Per Common Share and Warrants of SEACOR Marine Holdings Inc. | ||||||||||||||||
| Continuing operations (Basic) | $ | (0.49 | ) | $ | (0.85 | ) | $ | (2.95 | ) | $ | (3.66 | ) | ||||
| Discontinued operations (Basic) | $ | (0.29 | ) | $ | 0.14 | $ | (0.14 | ) | $ | 0.24 | ||||||
| $ | (0.78 | ) | $ | (0.71 | ) | $ | (3.09 | ) | $ | (3.42 | ) | |||||
| Continuing operations (Diluted) | $ | (0.49 | ) | $ | (0.85 | ) | $ | (2.95 | ) | $ | (3.66 | ) | ||||
| Discontinued operations (Diluted) | $ | (0.29 | ) | $ | 0.14 | $ | (0.14 | ) | $ | 0.24 | ||||||
| $ | (0.78 | ) | $ | (0.71 | ) | $ | (3.09 | ) | $ | (3.42 | ) | |||||
| Weighted Average Common Shares and Warrants Outstanding: | ||||||||||||||||
| Basic and diluted shares | 23,740,718 | 22,512,886 | 23,406,759 | 20,391,297 | ||||||||||||
| SEACOR MARINE HOLDINGS INC. UNAUDITED CONSOLIDATED STATEMENTS OF LOSS (in thousands, except statistics and per share data) |
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| Three Months Ended | Nine Months Ended | |||||||||||||||
| Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |||||||||||||
| Time Charter Statistics: | ||||||||||||||||
| Average Rates Per Day Worked (excluding crew transfer) | $ | 10,946 | $ | 10,690 | $ | 10,387 | $ | 9,971 | ||||||||
| Average Rates Per Day | $ | 6,981 | $ | 7,060 | $ | 6,970 | $ | 6,840 | ||||||||
| Fleet Utilization (excluding crew transfer) | 64 | % | 56 | % | 60 | % | 51 | % | ||||||||
| Fleet Utilization | 74 | % | 67 | % | 67 | % | 58 | % | ||||||||
| Fleet Available Days (excluding crew transfer) | 6,048 | 7,310 | 19,034 | 22,056 | ||||||||||||
| Fleet Available Days | 9,578 | 10,808 | 29,484 | 32,341 | ||||||||||||
| Operating Revenues: | ||||||||||||||||
| Time charter | $ | 49,747 | $ | 50,866 | $ | 137,836 | $ | 128,992 | ||||||||
| Bareboat charter | 1,765 | 1,168 | 4,297 | 3,467 | ||||||||||||
| Other marine services | 3,188 | 6,135 | 10,289 | 12,211 | ||||||||||||
| 54,700 | 58,169 | 152,422 | 144,670 | |||||||||||||
| Costs and Expenses: | ||||||||||||||||
| Operating: | ||||||||||||||||
| Personnel | 15,879 | 19,166 | 50,416 | 50,489 | ||||||||||||
| Repairs and maintenance | 5,495 | 7,581 | 20,686 | 20,706 | ||||||||||||
| Drydocking | 515 | 3,666 | 5,082 | 6,670 | ||||||||||||
| Insurance and loss reserves | 1,198 | 1,623 | 4,375 | 4,466 | ||||||||||||
| Fuel, lubes and supplies | 2,910 | 3,715 | 8,918 | 9,548 | ||||||||||||
| Other | 1,214 | 2,649 | 8,270 | 7,960 | ||||||||||||
| 27,211 | 38,400 | 97,747 | 99,839 | |||||||||||||
| Direct Vessel Profit | 27,489 | 19,769 | 54,675 | 44,831 | ||||||||||||
| Other Costs and Expenses: | ||||||||||||||||
| Lease expense | 4,171 | 3,292 | 12,636 | 9,881 | ||||||||||||
| Administrative and general | 12,509 | 11,767 | 36,148 | 39,182 | ||||||||||||
| Depreciation and amortization | 16,091 | 16,397 | 48,600 | 52,940 | ||||||||||||
| 32,771 | 31,456 | 97,384 | 102,003 | |||||||||||||
| Gains (Losses) on Asset Dispositions and Impairments, Net | 861 | (1,765 | ) | (2,719 | ) | (3,493 | ) | |||||||||
| Operating Loss | (4,421 | ) | (13,452 | ) | (45,428 | ) | (60,665 | ) | ||||||||
| Other Income (Expense): | ||||||||||||||||
| Interest income | 317 | 305 | 886 | 869 | ||||||||||||
| Interest expense | (7,362 | ) | (7,660 | ) | (22,659 | ) | (20,077 | ) | ||||||||
| SEACOR Holdings guarantee fees | (26 | ) | (5 | ) | (87 | ) | (24 | ) | ||||||||
| Debt extinguishment loss | — | (638 | ) | (638 | ) | |||||||||||
| Derivative losses (gains), net | 3,057 | 4,393 | 734 | (9,797 | ) | |||||||||||
| Foreign currency gains, net | (370 | ) | (302 | ) | (624 | ) | (967 | ) | ||||||||
| Other, net | — | 678 | — | 678 | ||||||||||||
| (4,384 | ) | (3,229 | ) | (21,750 | ) | (29,956 | ) | |||||||||
| Loss Before from Continuing Operations Before Income Tax Benefit and Equity in Earnings of 50% or Less Owned Companies | (8,805 | ) | (16,681 | ) | (67,178 | ) | (90,621 | ) | ||||||||
| Income Tax Expense (Benefit) | 1,277 | 1,248 | (5,606 | ) | (13,304 | ) | ||||||||||
| Loss from Continuing Operations Before Equity in Earnings of 50% or Less Owned Companies | (10,082 | ) | (17,929 | ) | (61,572 | ) | (77,317 | ) | ||||||||
| Equity in Losses of 50% or Less Owned Companies | (1,325 | ) | (1,022 | ) | (11,879 | ) | (1,734 | ) | ||||||||
| Loss from Continuing Operations | (11,407 | ) | (18,951 | ) | (73,451 | ) | (79,051 | ) | ||||||||
| (Loss) Income from Discontinued Operations, Net of Tax | (6,384 | ) | 3,185 | (3,327 | ) | 4,968 | ||||||||||
| Net Loss | (17,791 | ) | (15,766 | ) | (76,778 | ) | (74,083 | ) | ||||||||
| Net Income (Loss) attributable to Noncontrolling Interests in Subsidiaries | 204 | 191 | (4,395 | ) | (4,269 | ) | ||||||||||
| Net Loss attributable to SEACOR Marine Holdings Inc. | $ | (17,995 | ) | $ | (15,957 | ) | $ | (72,383 | ) | $ | (69,814 | ) | ||||
| Basic and Diluted Income (Loss) Per Common Share and Warrants of SEACOR Marine Holdings Inc. | ||||||||||||||||
| Continuing operations (Basic) | $ | (0.49 | ) | $ | (0.85 | ) | $ | (2.95 | ) | $ | (3.66 | ) | ||||
| Discontinued operations (Basic) | $ | (0.29 | ) | $ | 0.14 | $ | (0.14 | ) | $ | 0.24 | ||||||
| $ | (0.78 | ) | $ | (0.71 | ) | $ | (3.09 | ) | $ | (3.42 | ) | |||||
| Continuing operations (Diluted) | $ | (0.49 | ) | $ | (0.85 | ) | $ | (2.95 | ) | $ | (3.00 | ) | ||||
| Discontinued operations (Diluted) | $ | (0.29 | ) | $ | 0.14 | $ | (0.14 | ) | $ | 0.24 | ||||||
| $ | (0.78 | ) | $ | (0.71 | ) | $ | (3.09 | ) | $ | (2.76 | ) | |||||
| Weighted Average Common Shares and Warrants Outstanding: | ||||||||||||||||
| Basic and Diluted | 23,741 | 22,513 | 23,408 | 20,391 | ||||||||||||
| Common Shares and Warrants Outstanding at Period End | 23,371 | 22,709 | 23,371 | 22,709 | ||||||||||||
| SEACOR MARINE HOLDINGS INC. UNAUDITED FLEET COUNTS |
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| Owned | Joint Ventured | Leased-in | Managed | Total (1) | ||||||||||||||||
| September 30, 2019 | ||||||||||||||||||||
| AHTS | 5 | — | 4 | — | 9 | |||||||||||||||
| FSV | 34 | 4 | 1 | — | 39 | |||||||||||||||
| Supply | 7 | 34 | — | 2 | 43 | |||||||||||||||
| Specialty | 1 | 3 | — | 2 | 6 | |||||||||||||||
| Liftboats | 14 | — | 2 | — | 16 | |||||||||||||||
| Crew transfer | 38 | 5 | — | — | 43 | |||||||||||||||
| Discontinued Operations | 18 | — | — | — | 18 | |||||||||||||||
| 117 | 46 | 7 | 4 | 174 | ||||||||||||||||
| December 31, 2018 | ||||||||||||||||||||
| AHTS | 8 | — | 4 | — | 12 | |||||||||||||||
| FSV | 32 | 5 | 1 | 3 | 41 | |||||||||||||||
| Supply | 7 | 30 | — | 2 | 39 | |||||||||||||||
| Specialty | 1 | 4 | — | 2 | 7 | |||||||||||||||
| Liftboats | 17 | — | 2 | — | 19 | |||||||||||||||
| Crew transfer | 38 | 4 | — | — | 42 | |||||||||||||||
| Discontinued Operations | 18 | 1 | — | — | 19 | |||||||||||||||
| 121 | 44 | 7 | 7 | 179 | ||||||||||||||||
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| (1 | ) | Excludes three owned and one leased-in offshore support vessels that have been retired and removed from service. |
Source: SEACOR Marine Holdings Inc.