Monday, May 05, 2008; Posted: 04:34 PM
"Led by two international well intervention projects and higher international response activity, the first quarter generated record revenue for Boots & Coots," stated Jerry Winchester, president and chief executive officer. "Our well intervention business increased 82% compared to the first quarter of last year, and the utilization rate on our hydraulic workover business increased sequentially from 42% at the end of last year's fourth quarter to 50% by the end of the first quarter."
"Our strategic initiatives have helped us increase Boots & Coots' global presence and integrate the company's service lines, such as expanding pressure control rental tools into our international locations as well as domestically in North and East Texas," continued Mr. Winchester. "Additionally, a recovery project in offshore India should help maintain momentum in the well intervention segment in the second quarter."
Business Segment Results
Well Intervention
For the quarter ended March 31, 2008, the Well Intervention segment generated revenues of $37.9 million and contributed EBITDA of $7.2 million, compared to revenues of $20.8 million and EBITDA of $2.4 million for the first quarter of 2007. The EBITDA margin was favorable due to increased activity partially offset by higher third-party costs associated with two international Safeguard projects.
Response
For the first quarter of 2008, the Response segment generated revenues of $7.1 million and contributed EBITDA of $2.7 million, compared to revenues of $1.4 million and EBITDA of $0.4 million for the first quarter of 2007. During the 2008 first quarter, the Company experienced a higher level of international response activity, primarily in Africa.
Conference Call
Boots & Coots will discuss 2008 first quarter results via a conference call and Webcast tomorrow, May 6, at 10:00 a.m. Central Time (11:00 a.m. Eastern Time). The dial-in number for the call is 866-831-6272, passcode 'Boots & Coots'. To listen to the live Webcast, log on to www.boots-coots.com/investor/invest.htm and click on the '2008 First Quarter Earnings Webcast' link. A replay of the Webcast will be available on the investor relations page of the Company's Website within 24 hours of the call. The call will also be available for replay for 30 days by dialing 888-286-8010, passcode 76022451.
About Boots & Coots
Boots & Coots International Well Control, Inc., Houston, Texas, provides a suite of integrated pressure control services to onshore and offshore oil and gas exploration companies around the world. The Well Intervention segment consists of services that are designed to enhance production for oil and gas operators and reduce the number and severity of critical well events such as well fires, blowouts or other losses of control at the well. This segment includes services performed by hydraulic workover and snubbing units and the rental of pressure control tools that are used to enhance production at the wells. The scope of these services also includes prevention services such as training, contingency planning, well plan reviews, audits, inspection services and engineering services offered through our Safeguard risk management programs. The Response segment consists of personnel, equipment and services provided during an emergency response such as a critical well event or a hazardous material response.
Certain statements included in this news release are intended as "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. Boots & Coots cautions that actual future results may vary materially from those expressed or implied in any forward-looking statements. More information about the risks and uncertainties relating to these forward-looking statements are found in Boots & Coots' SEC filings, which are available free of charge on the SEC's web site at www.sec.gov.
(Tables to follow)
BOOTS & COOTS INTERNATIONAL WELL CONTROL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (000's except share and per share amounts) (unaudited) Three Months Ended March 31, 2008 2007 ------------- -------------- REVENUES $ 45,028 $ 22,257 COST OF SALES, excluding depreciation and amortization 26,489 13,995 ------------- -------------- Gross Margin 18,539 8,262 OPERATING EXPENSES 6,170 4,459 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 2,490 1,003 FOREIGN CURRENCY TRANSLATION 37 68 DEPRECIATION AND AMORTIZATION 2,103 1,314 ------------- -------------- OPERATING INCOME 7,739 1,418 INTEREST EXPENSE, net 602 733 ------------- -------------- INCOME BEFORE INCOME TAXES 7,137 685 INCOME TAX EXPENSE 1,993 221 ------------- -------------- NET INCOME $ 5,144 $ 464 ============= ============== Basic Earnings per Common Share $ 0.07 $ 0.01 ============= ============== Weighted Average Common Shares Outstanding - Basic 75,013,000 59,203,000 ============= ============== Diluted Earnings per Common Share $ 0.07 $ 0.01 ============= ============== Weighted Average Common Shares Outstanding - Diluted 76,932,000 61,642,000 ============= ==============
Information concerning operations in our different business segments for the three months ended March 31, 2008 and 2007 is presented below. Certain reclassifications have been made to the prior periods to conform to the current presentation.
(unaudited) Three Months Ended March 31, 2008 2007 ---------- ---------- Revenues Well Intervention $ 37,949 $ 20,844 Response 7,079 1,413 ---------- ---------- $ 45,028 $ 22,257 ---------- ---------- EBITDA (a) Well Intervention $ 7,178 $ 2,363 Response 2,664 369 ---------- ---------- $ 9,842 $ 2,732 ---------- ---------- Depreciation and Amortization (b) Well Intervention $ 1,859 $ 1,299 Response 244 15 ---------- ---------- $ 2,103 $ 1,314 ---------- ---------- Operating Income Well Intervention $ 5,319 $ 1,064 Response 2,420 354 ---------- ---------- $ 7,739 $ 1,418 ---------- ----------
(a) EBITDA represents earnings before interest, taxes, depreciation and amortization. See the reconciliation and rationale for this non-GAAP financial measure below. (b) Operating expenses and depreciation and amortization have been charged to each segment based upon specific identification of expenses and an allocation of remaining non-segment specific expenses pro rata between segments based upon relative revenues.
BOOTS & COOTS INTERNATIONAL WELL CONTROL, INC. RECONCILIATION BETWEEN CONSOLIDATED STATEMENTS OF INCOME AND EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (in thousands) (unaudited) Three Months Ended March 31, --------------------- 2008 2007 ---------- ---------- Net Income $ 5,144 $ 464 Income Tax Expense $ 1,993 $ 221 Interest Expense and Other, net $ 602 $ 733 Depreciation and Amortization $ 2,103 $ 1,314 Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) (a) $ 9,842 $ 2,732
(a) Earnings before Interest, Income taxes, Depreciation, Depletion and Amortization ("EBITDA") is a non-GAAP financial measure, as it excludes amounts or is subject to adjustments that effectively exclude amounts, included in the most directly comparable measure calculated and presented in accordance with GAAP in financial statements. "GAAP" refers to generally accepted accounting principles in the United States of America. Non-GAAP financial measures disclosed by management are provided as additional information to investors in order to provide them with an alternative method for assessing our financial condition and operating results. These measures are not in accordance with, or a substitute for, GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. Pursuant to the requirements of Regulation G, whenever we refer to a non-GAAP financial measure, we also present the most directly comparable financial measure and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure and such comparable GAAP financial measure. Management believes that EBITDA may provide additional information with respect to the Company's performance or ability to meet its debt service and working capital requirements.
BOOTS & COOTS INTERNATIONAL WELL CONTROL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) March 31, December 31, 2008 2007 ------------ ------------ (unaudited) Current Assets $ 65,844 $ 61,755 Current Liabilities $ 30,129 $ 27,043 Total Working Capital (a) $ 35,715 $ 34,712 Total Assets $145,050 $136,415 Long-Term Debt and Notes Payable, net of current maturities $ 26,759 $ 26,151 Total Liabilities $ 62,392 $ 59,372 Total Stockholders' Equity $ 82,658 $ 77,043
(a) The Company defines Working Capital as all current assets, including cash, less all current liabilities which includes current maturities of long-term debt.
SOURCE: Boots & Coots International Well Control, Inc.
Boots & Coots International Well Control, Inc. Investor Contact: Jennifer Tweeton, 281-931-8884 jtweeton@boots-coots.com or Company Contact: Chief Financial Officer Gabriel Aldape, 281-931-8884 investorrelations@bncg.com
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