DALLAS, Jan. 28 /PRNewswire-FirstCall/ -- ENSCO International Incorporated
(NYSE: ESV) reported net income of $26.5 million ($0.18 per diluted share) on
revenues of $199.2 million for the three months ended December 31, 2003,
compared to a net loss of $10.7 million ($0.07 per diluted share) on revenues
of $194.2 million for the three months ended December 31, 2002. The fourth
quarter 2002 results included a $46.1 million non-cash after tax impairment
charge ($0.31 per diluted share) related to the Company's Venezuela assets and
operations.
For the year ended December 31, 2003, ENSCO reported net income of
$108.3 million ($0.72 per diluted share) on revenues of $790.8 million,
compared to net income of $59.3 million ($0.42 per diluted share) on revenues
of $649.5 million for the year ended December 31, 2002. The Company's net
income for 2002 included the after tax impairment charge of $46.1 million
discussed above and a $3.8 million after tax gain in connection with an
insurance recovery for a rig that had earlier sustained extensive damage from
a natural gas fire.
The Company's balance sheet at year-end 2003 remained strong, with cash of
$354.0 million and a 21% long-term debt to total capitalization ratio (defined
as long-term debt divided by the sum of long-term debt plus stockholders'
equity).
The average day rate for ENSCO's jackup rig fleet was $48,800 during the
fourth quarter of 2003, compared to $48,000 in the year earlier period.
Utilization for the Company's jackup fleet in the most recent quarter
decreased slightly to 84%, down from 86% in the fourth quarter of 2002.
Excluding rigs in a shipyard for contract preparation, regulatory inspection
and enhancement, ENSCO's jackup utilization in the most recent quarter was
91%, compared to 93% in the year earlier period.
Carl Thorne, Chairman and Chief Executive Officer of ENSCO, commented on
the Company's markets and outlook: "As anticipated, fourth quarter 2003
results were impacted by lower average day rates in the North Sea and a
temporary lull in Asia Pacific activity as 2003 programs were completed,
offset in part by higher average day rates for our Gulf of Mexico jackup rigs.
"In our Asia Pacific business unit, all five of our jackup rigs that
underwent remedial shipyard and/or contract preparation work during the fourth
quarter of 2003 have either returned to service or have been committed to
return to work during the first quarter of 2004. Another jackup rig completed
a contract at the end of 2003 and will have approximately two and one half
months downtime before commencing a new contract in March of 2004. Despite
the incurred and expected downtime for various jackup rigs during the fourth
quarter of 2003 and the first quarter of 2004, we remain positive on the
outlook for the markets which comprise our Asia Pacific business unit. We now
enjoy approximately ten rig-years of contract backlog for our Asia Pacific
jackup fleet.
"Given our favorable market outlook in Asia Pacific and our strong cash
position, we have elected to exercise our option to acquire the non-owned 75%
interest in ENSCO 102, a jointly owned jackup rig now operating for Shell in
Malaysia. The option to purchase the remaining ownership interest was
scheduled to expire in May 2004. ENSCO will pay approximately $95 million
from available cash to acquire full ownership of the rig in a transaction that
is expected to close before the end of this week.
"In the North Sea, the jackup market is stable and we expect little change
in day rates over the next three months.
"In the Gulf of Mexico, day rates for our jackup rigs are stable. We
continue our rig enhancement program with ENSCO 68 in a shipyard until the end
of the third quarter of 2004, and with ENSCO 67 scheduled to enter a shipyard
early in the second quarter for approximately nine months of work. ENSCO
7500, our deepwater semisubmersible rig currently under contract in the Gulf
of Mexico, is expected to complete its contract in early March. We are
currently marketing the rig.
"Looking ahead, we expect first quarter 2004 results to be impacted by
several factors. Our Asia Pacific business unit will continue to experience
downtime on certain rigs before they commence new contracts during the
quarter. First quarter 2004 results will be adversely impacted, relative to
our fourth quarter 2003 results, due to completion of the favorable term
contract on the ENSCO 7500 in early March.
"Based on our current view of market conditions, we anticipate an
improving trend in our 2004 results starting in the second quarter."
Statements contained in this news release that state the Company's or
management's intentions, hopes, beliefs, expectations, anticipations or
predictions of the future are forward-looking statements made pursuant to the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include references to any trends in day rates or utilization,
future rig utilization and contract commitments, the period of time and number
of our rigs that will be in a shipyard, market trends or conditions, market
outlook, the amount of rig-years of contract backlog for our Asia Pacific
fleet, our first quarter 2004 earnings expectation and the projected trend in
2004 results starting in the second quarter. It is important to note that the
Company's actual results could differ materially from those projected in such
forward-looking statements. The factors that could cause actual results to
differ materially from those in the forward-looking statements include the
following: (i) industry conditions and competition, (ii) cyclical nature of
the industry, (iii) worldwide expenditures for oil and gas drilling, (iv)
operational risks and insurance, (v) risks associated with operating in
foreign jurisdictions, (vi) renegotiation, nullification, or breach of
contracts with customers or other parties, (vii) environmental or other
liabilities which may arise in the future which are not covered by insurance
or indemnity, (viii) the impact of current and future laws and government
regulation, as well as repeal or modification of same, affecting the oil and
gas industry in general and the Company's operations in particular, (ix)
changes in the dates the Company's rigs undergoing shipyard work or
enhancement will enter a shipyard or return to service, (x) political and
economic uncertainty in Venezuela and elsewhere, (xi) the risk that the
Company may be unable to secure a contract for the ENSCO 7500, and (xii) other
risks described from time to time in the Company's SEC filings. Copies of
such filings may be obtained at no charge by contacting the Company's investor
relations department at 214-397-3045 or by referring to the investor relations
section of the Company's website at http://www.enscous.com .
All information in this press release is as of January 28, 2004. The
Company undertakes no duty to update any forward-looking statement to conform
the statement to actual results or reflect changes in the Company's
expectations.
ENSCO, headquartered in Dallas, Texas, provides contract drilling services
to the global petroleum industry.
ENSCO will conduct a publicly accessible conference call at 9:00 a.m.
Central Time on Wednesday, January 28, 2004, to discuss its fourth quarter
results. The call will be broadcast live over the Internet at
http://www.enscous.com . Parties may also listen to the call by dialing
913.981.5558. It is recommended that participants call five to ten minutes
before the scheduled start time.
A replay of the conference call will be available on ENSCO's web site
http://www.enscous.com or, by phone at 719.457.0820 (access number 620925) starting
today at 1:00 pm CT until midnight January 29, 2004.
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(In millions, except per share data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2003 2002 2003 2002
OPERATING REVENUES $199.2 $194.2 $790.8 $649.5
OPERATING EXPENSES
Contract drilling 115.9 102.5 452.9 348.9
Depreciation and amortization 34.4 32.4 135.0 117.0
Impairment of assets --- 59.9 --- 59.9
General and administrative 6.1 4.8 22.0 18.6
156.4 199.6 609.9 544.4
OPERATING INCOME (LOSS) 42.8 (5.4) 180.9 105.1
OTHER INCOME (EXPENSE)
Interest income 0.9 0.9 3.4 5.1
Interest expense, net (9.5) (7.5) (36.7) (31.1)
Other, net 2.1 --- 1.7 6.4
(6.5) (6.6) (31.6) (19.6)
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES 36.3 (12.0) 149.3 85.5
PROVISION (BENEFIT) FOR INCOME TAXES 9.9 (3.9) 42.1 27.2
INCOME (LOSS) FROM CONTINUING
OPERATIONS 26.4 (8.1) 107.2 58.3
DISCONTINUED OPERATIONS 0.1 (2.6) 1.1 1.0
NET INCOME (LOSS) $26.5 $(10.7) $108.3 $59.3
EARNINGS (LOSS) PER SHARE - BASIC
Continuing operations $0.18 $(0.05) $0.71 $0.41
Discontinued operations 0.00 (0.02) 0.01 0.01
$0.18 $(0.07) $0.72 $0.42
EARNINGS (LOSS) PER SHARE - DILUTED
Continuing operations $0.18 $(0.05) $0.71 $0.41
Discontinued operations 0.00 (0.02) 0.01 0.01
$0.18 $(0.07) $0.72 $0.42
AVERAGE COMMON SHARES OUTSTANDING
Basic 150.0 149.0 149.6 140.7
Diluted 150.3 149.0 150.1 141.4
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEET
(In millions)
December 31, December 31,
2003 2002
ASSETS
CURRENT ASSETS
Cash and cash equivalents $354.0 $147.1
Short-term investments --- 38.4
Accounts receivable, net 149.4 162.8
Prepaid expenses and other 39.9 39.2
Total current assets 543.3 387.5
PROPERTY AND EQUIPMENT, NET 2,217.2 2,258.0
GOODWILL 342.7 350.2
OTHER ASSETS, NET 79.8 65.8
$3,183.0 $3,061.5
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued
liabilities $164.4 $176.8
Current maturities of long-term debt 23.0 21.5
Total current liabilities 187.4 198.3
LONG-TERM DEBT 549.9 547.5
DEFERRED INCOME TAXES 345.9 332.3
OTHER LIABILITIES 18.7 16.4
STOCKHOLDERS' EQUITY 2,081.1 1,967.0
$3,183.0 $3,061.5
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Twelve Months Ended
December 31,
2003 2002
OPERATING ACTIVITIES
Net income $108.3 $59.3
Adjustments to reconcile net income to
net cash provided by operating
activities of continuing operations:
Depreciation and amortization 135.0 117.0
Changes in working capital and other 44.5 26.3
Net cash provided by operating
activities of continuing operations 287.8 202.6
INVESTING ACTIVITIES
Additions to property and equipment (186.6) (218.2)
Net proceeds from sale of discontinued
operations 78.8 ---
Net cash used in Chiles acquisition --- (99.9)
Other 29.4 40.5
Net cash used in investing activities
of continuing operations (78.4) (277.6)
FINANCING ACTIVITIES
Proceeds from long-term borrowings 26.7 4.4
Reduction of long-term borrowings (23.0) (63.7)
Cash dividends paid (15.0) (14.2)
Other 11.4 17.2
Net cash provided by (used in)
financing activities of continuing
operations 0.1 (56.3)
EFFECT OF EXCHANGE RATE FLUCTUATIONS ON CASH
AND CASH EQUIVALENTS 0.9 (0.9)
NET CASH PROVIDED BY (USED IN)
DISCONTINUED OPERATIONS (3.5) 0.5
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 206.9 (131.7)
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD 147.1 278.8
CASH AND CASH EQUIVALENTS, END OF PERIOD $354.0 $147.1
ENSCO INTERNATIONAL INCORPORATED
OPERATING STATISTICS
Third
Fourth Quarter Quarter
2003 2002 2003
Contract drilling
Average day rates
Jackup rigs
North America $37,608 $31,379 $31,987
Europe / Africa 56,107 66,591 61,025
Asia Pacific 63,812 60,560 62,989
South America / Caribbean 89,228 78,075 90,040
Total jackup rigs 48,795 48,047 47,803
Semisubmersible rig - N. America 187,197 188,897 189,433
Barge rigs
Asia Pacific 41,788 n/a 41,923
South America / Caribbean 38,396 39,515 42,569
Total barge rigs 39,601 39,515 42,246
Platform rigs - North America 25,957 26,586 25,846
Total $50,499 $50,186 $50,118
Utilization
Jackup rigs
North America 88% 83% 86%
Europe / Africa 94% 98% 91%
Asia Pacific 68% 83% 88%
South America / Caribbean 100% 100% 98%
Total jackup rigs 84% 86% 88%
Semisubmersible rig - N. America 92% 100% 95%
Barge rigs
Asia Pacific 100% 10% 100%
South America / Caribbean 30% 22% 17%
Total barge rigs 40% 21% 29%
Platform rigs - North America 32% 60% 40%
Total 74% 76% 76%
SOURCE ENSCO International Incorporated
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Related links:
http://www.enscous.com
CONTACT:
Richard LeBlanc of ENSCO International
Incorporated, +1-214-397-3011
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