OMNI Energy Services Corp. (Nasdaq:OMNI) today reported a first
quarter 2010 net loss of $0.8 million, $0.05 per diluted share, on
revenues of $26.8 million, compared to a net income of $0.9
million, $0.04 per diluted share, on revenues of $34.9 million for
the same period of 2009. The decrease in net income is due in large
part to reduced activity in OMNI's Seismic Services segment.
Financial Highlights
-- Revenues: First quarter 2010 revenues decreased by $8.1
million, to $26.8 million as compared to the first quarter of 2009.
Revenue in our Seismic Services segment was down $5.1 million
compared to same period in 2009 due to the impact of weather,
particularly in the northeastern United States, and reduced capital
spending by OMNI's clients. The Equipment Leasing segment
continues to experience rate compression resulting in reduced
revenue of $6.7 million compared to $8.9 million for the same
period in 2009. The Environmental and Other Services segment
suffered a slight decrease to $15.5 million compared to $16.3
million for the same period of 2009 as this segment has greater
participation in the production portion of the sector.
-- Operating Income: First quarter 2010 Operating Income
decreased by $3.2 million, to a loss of $0.4 million as compared to
the first quarter 2009 due in large part to our Seismic Services
segment. Restrained capital budgets of 2009 caused the decline in
backlog last year, thereby compressing revenue and margins.
Additionally, severe cold in the northeast and wet conditions in
the Gulf Coast during the first quarter 2010 further impacted
drilling and pushed some projects back to the second
quarter. Entry into frontier markets for our Environmental and
Other Services segment resulted in reduced margins due to the
required use of third-party services.
-- Net interest expense: First quarter 2010 Net Interest Expense
increased by $0.2 million to $1.2 million due primarily to
increased interest rates and charges related to modifications to
our subordinated debt.
-- Income tax benefit: The effective tax rate for the first
quarter 2010 was 47.0% compared to 45.7% in the same period in
2009. Current provisions of federal and state taxes are at the
full statutory rates after considering permanent
differences.
-- Earnings before interest, taxes, depreciation and
amortization, other income (expense), non-cash stock compensation
and gain or loss on disposal of fixed assets ("Adjusted
EBITDA"): First quarter 2010 Adjusted EBITDA was $3.2 million,
50% lower than the $6.5 million of Adjusted EBITDA reported for the
comparable 2009 period. Adjusted EBITDA, which is a non-GAAP
financial measure, is provided herein to assist investors in better
understanding OMNI's financial performance. See the reconciliation
of net income to Adjusted EBITDA on the last page of this press
release including a discussion of why OMNI believes this non-GAAP
financial measure is useful.
-- Balance Sheet: Total debt was $49.4 million and cash and cash
equivalents were $1.8 for a net debt position of $47.6 million as
of March 31, 2010. The Company had available capacity on its
revolver of $10.5 million ($4.7 million of which is currently being
used to secure outstanding standby letters of credit and other
contingencies) and outstanding revolver borrowings of $0.1 million
in respect of this facility at the end of the first quarter of
2010.
Brian J. Recatto, President and Chief Executive Officer of OMNI,
commented, "Our first quarter reflects the continued challenging
conditions facing the markets we serve. We continue to manage
our business and position the Company for improving market
conditions which we see beginning to take hold in the second
quarter. Our geographic expansion into the northeast in the
Marcellus Shale was particularly challenged by extreme weather
conditions in the first quarter and had a significant adverse
impact on our ability to execute work in our Seismic Services
segment. Backlog has improved significantly and we anticipate
healthy drilling levels to begin during the middle of the second
quarter.
"Our recently commissioned automated cleaning system and other
cleaning technologies continue to offer organic growth
opportunities as they are now coming on line and producing the
expected revenue contribution. Environmental and Other Services, as
well as Equipment Leasing segments, have shown steady improvement
from the third and fourth quarter of 2009. With the increased
rig count, pricing has stabilized, and we have secured price
increases in certain geographic markets. While we continue to
experience some reduced activity, we feel we have been able to
maintain market share and have begun to experience modest recovery
in these segments.
"Capital spending continues to be a primary focus item for
us. We, like our entire industry, are subject to the
volatility in commodity prices, financial markets which continue to
be tight and the resulting impact on our customers and their
capital spending. With the rig count stable, and our position
within some of the more exciting developmental areas, we are
optimistic that the worst of the market conditions are behind
us. We are positioned to take advantage of opportunities in
new and existing markets, including placing personnel and assets in
emerging oily plays like the Eagle Ford in south Texas and the
Bakken formation in the Rocky mountain region.
"As expected, we are beginning to experience improved results in
all our divisions, and look forward to continued organic growth as
well the ability to capitalize on complementary acquisitions at
attractive prices."
Headquartered in Carencro, LA, OMNI Energy Services Corp. offers
a broad range of integrated services to geophysical companies
engaged in the acquisition of on-shore seismic data and to oil and
gas companies operating primarily in the Gulf of Mexico. OMNI
provides its services through three business segments: Seismic
Services (including drilling, survey and permitting services),
Environmental and Other Services, and Equipment Leasing,. OMNI's
services play a significant role with geophysical companies who
have operations in marsh, swamp, shallow water and the U.S. Gulf
Coast also called transition zones and contiguous dry land areas
also called highland zones.
Forward-looking statements in this release are made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that all
forward-looking statements involve risks and uncertainties
associated with the impact of the current economic climate,
the efficacy of I.M.P.A.C.T. ™ cleaning technology
and receipt of its patent, the timely conversion of seismic
drilling backlog into revenue, the acceptance and use of OMNI's
environmental cleaning services, OMNI's dependence on activity in
the oil and gas industry, labor shortages, permit delays,
dependence on significant customers, seasonality and weather risks,
competition, technological evolution, the ultimate outcome of
pending litigation, the continued growth of our environmental and
other services and equipment leasing business segments, and other
risks detailed in OMNI's filings with the Securities and Exchange
Commission.
OMNI ENERGY SERVICES CORP.
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(unaudited)
|
|
|
|
Three Months Ended
March 31,
|
|
2009
|
2010
|
|
(in thousands, except per share amounts)
|
Operating revenue
|
|
|
Services
|
$ 25,981
|
$ 20,129
|
Rentals
|
8,923
|
6,716
|
Total operating revenue
|
34,904
|
26,845
|
Operating expenses:
|
|
|
Direct costs (exclusive of depreciation and amortization
shown
separately below)
|
|
|
Services
|
18,189
|
16,099
|
Rentals
|
4,458
|
3,438
|
Depreciation and amortization
|
3,337
|
3,412
|
General and administrative expenses
|
6,172
|
4,299
|
Total operating expenses
|
32,156
|
27,248
|
Operating income (loss)
|
2,748
|
(403)
|
Interest expense
|
(1,040)
|
(1,204)
|
Other income, net
|
6
|
20
|
Income (loss) before income tax expense
|
1,714
|
(1,587)
|
Provision for income tax (expense) benefit
|
(784)
|
746
|
Net income (loss)
|
930
|
(841)
|
Dividends on preferred stock
|
(120)
|
(120)
|
|
|
|
Net income (loss) available to common stockholders
|
$ 810
|
$ (961)
|
|
|
|
Basic income (loss) per share:
|
|
|
Net income (loss) available to common stockholders
|
$ 0.04
|
$ (0.05)
|
|
|
|
Diluted income (loss) per share:
|
|
|
Net income (loss) available to common stockholders
|
$ 0.04
|
$ (0.05)
|
|
|
|
Weighted average common shares outstanding:
|
|
|
Basic
|
20,577
|
21,014
|
Diluted
|
24,226
|
21,014
|
EBITDA consists of earnings (net income or loss) before interest
expense, provision for income taxes, depreciation and amortization.
Adjusted EBITDA includes other income (expense), non-cash
stock-based compensation and gain or loss on disposal of fixed
assets because these items are either non-recurring or non-cash.
This term, as we define it, may not be comparable to similarly
titled measures employed by other companies and is not a measure of
performance calculated in accordance with U.S. generally accepted
accounting principles (GAAP).
The Securities and Exchange Commission (SEC) has adopted rules
regulating the use of non-GAAP financial measures, such as EBITDA
and Adjusted EBITDA, in disclosures and press releases. These rules
require non-GAAP financial measures to be presented with, and
reconciled to, the most nearly comparable financial measure
calculated and presented in accordance with GAAP.
Set forth below is a reconciliation of net income (loss) to
Adjusted EBITDA. Management uses Adjusted EBITDA to measure the
operating results and effectiveness of our ongoing business. We
believe this measurement is important to our investors and
financial analysts because it allows a more effective evaluation of
the Company's performance using the same measurements that
management uses. Adjusted EBITDA is an indication of the Company's
ability to generate cash available to internally fund our expansion
plans and service our debt obligations. This non-GAAP financial
measure may not be comparable to similarly titled measurements used
by other companies and should not be used as a substitute for net
income (loss), earnings (loss) per share, operating cash flow or
other GAAP operating measurements. The results shown below include
results for the first quarter 2009 and 2010.
OMNI ENERGY SERVICES
CORP.
|
OTHER FINANCIAL DATA
|
(Unaudited)
|
|
|
|
|
Three months
|
Three months
|
|
ended March 31,
|
ended March 31,
|
|
|
|
|
2009
|
2010
|
|
|
|
|
Actual
|
Actual
|
Net income (loss)
|
$ 930
|
$ (841)
|
Plus (less):
|
|
|
Interest
|
1,040
|
1,204
|
(Gain) loss on sale of fixed assets
|
16
|
(20)
|
Other (income) expense
|
(6)
|
(20)
|
Depreciation and amortization
|
3,337
|
3,412
|
Non-cash stock compensation
|
398
|
258
|
Income tax (benefit) expense
|
784
|
(746)
|
Adjusted EBITDA
|
$ 6,499
|
$ 3,247
|
OMNI&
CONTACT: OMNI Energy Services Corp.
Ronald D. Mogel, Senior Vice President and
Chief Financial Officer
(337) 896-6664
Omni Energy Svcs Corp (MM) (NASDAQ:OMNI)
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