CARLYSS, La., May 7 /PRNewswire-FirstCall/ -- Global Industries, Ltd.(Nasdaq: GLBL) announced revenues of $301.5 million in the first quarter of2008 compared to $277.0 million in the first quarter of 2007. Net income was$26.8 million, or $0.23 per diluted share, for the first quarter of 2008.This compares to net income of $54.5 million, or $0.46 per diluted share, forthe first quarter of 2007. The first quarter of 2007 included higher marginwork from post-hurricane projects in the Gulf of Mexico and from Pemexprojects in Latin America. Net income in the first quarter of 2008 wasnegatively impacted by low activity in the Gulf of Mexico due primarily toadverse weather conditions, non-recovered vessel costs, and delayedmobilization of vessels in West Africa due to security and logistical issues.
Higher revenues during the first quarter of 2008 reflect substantialproject growth in the Middle East that more than offset lower revenuesgenerated from Latin America and the Gulf of Mexico. Revenues and net incomefrom the Gulf of Mexico during the first quarter of 2008 were negativelyimpacted by adverse weather and drydocking activity. During the first quarterof 2008, profitability was lower than what it could have been in the Gulf ofMexico, West Africa and Asia Pacific/India by the unavailability of certainvessels undergoing drydocking activity. Non-recovered vessel costs incurredduring these regulatory drydockings were approximately $11.3 million.
Selling, general and administrative expenses for the first quarter of 2008increased by $4.9 million over the same quarter last year primarily due toincreased legal fees for the ongoing West Africa internal investigation,salaries and administrative expenses. We experienced higher administrativeexpenses while establishing offices to support the additional projects inBrazil and the Middle East.
Other income for the first quarter of 2008 increased by $2.7 million overthe same quarter last year primarily due to interest income earned on higherbalances of cash, cash equivalents, and marketable securities.
The effective tax rate declined by 4% to 27% for the first quarter of 2008compared to the same quarter last year, reflecting a greater percentage ofearnings generated in foreign jurisdictions with lower statutory tax rates.
During the first quarter of 2008, the Company booked $124.5 million of netnew work resulting in a backlog of $536.6 million as of March 31, 2008. Thiscompares to a backlog of $530.2 million as of March 31, 2007.
'I am pleased with the growth of our revenues which reflects our expandedoperations into international regions, especially the Middle East and Brazil.Unfortunately, during the quarter our profits were reduced by seasonally harshweather in the Gulf of Mexico and security and logistical issues in WestAfrica. We are working diligently to overcome the challenges in West Africa,including improving our contract terms to mitigate our financial risk andmanaging costs.
We have also strengthened our position in Asia Pacific/India with the newlyawarded contracts worth $110 million which was announced in April 2008.Backlog continues to be strong and worldwide bid activity remains very high at$4.4 billion. I believe that the current trends in energy prices and offshoreexploration and development will drive increasing demand for our services in2008 and beyond,' said B.K. Chin, Chairman and Chief Executive Officer ofGlobal Industries.
A conference call will be held at 9:00 a.m. Central Daylight Saving Timeon Thursday, May 8, 2008. Anyone wishing to listen to the conference call maydial 888.455.8368 (domestic) or 210.839.8890 (international) and requestconnection to the 'Global First Quarter Earnings' call. Phone lines will openfifteen minutes prior to the start of the call. The call will also be webcastin real time on the Company's website at http://www.globalind.com, where itwill also be archived for anytime reference until May 29, 2008.
All individuals listening to the conference call or the replay arereminded that all conference call material is copyrighted by Global and cannotbe recorded or rebroadcast without Global's express written consent.
Global Industries, Ltd. provides worldwide construction, engineering, andsubsea services, including pipeline construction, platform installation andremoval, project management, construction support, diving services, diverlessintervention, and marine support services to the offshore oil and gasindustry.
This press release may contain forward-looking information based oncurrent information and expectations of the Company that involve a number ofrisks, uncertainties, and assumptions. Among the factors that could cause theactual results to differ materially are: industry conditions, prices of crudeoil and natural gas, the Company's ability to obtain and the timing of newprojects, and changes in competitive factors. Should one or more of theserisks or uncertainties materialize, or should the underlying assumptions proveincorrect, actual outcomes could vary materially from those indicated.Set forth are the Company's results of operations and selected balance sheetamounts for the periods indicated.
Set forth are the Company's results of operations and selected balancesheet amounts for the periods indicated.
RESULTS OF OPERATIONS (Unaudited) (In thousands, except per share data)
Three Months Ended March 31 ----------------------- 2008 2007 --------- --------- Revenues $ 301,465 $ 277,009 Cost of operations 247,135 183,535 --------- --------- Gross profit 54,330 93,474 Net gain on asset disposal (2,163) (1,320) Selling, general and administrative expenses 23,039 18,144 --------- --------- Operating income 33,454 76,650 --------- --------- Other expense (income): Interest expense 4,118 2,741 Other income, net (7,620) (4,885) --------- --------- Income before taxes 36,956 78,794 Income taxes 10,126 24,338 --------- --------- Net income $ 26,830 $ 54,456 ========= ========= Earnings Per Common Share Basic $ 0.23 $ 0.47 Diluted 0.23 0.46
Weighted Average Common Shares Outstanding Basic 115,267 116,583 Diluted 116,742 117,982
Other Data Depreciation and Amortization $ 14,072 $ 16,799 Backlog at end of period 536,606 530,218
SELECTED BALANCE SHEET AMOUNTS (Unaudited) (In thousands)
As of As of March 31 December 31 2008 2007 ----------- ----------- Cash and cash equivalents $ 674,408 $ 723,450 Working Capital (including cash and cash equivalents) 815,387 843,017 Total Assets 1,605,287 1,589,798 Debt (including current portion) 392,320 394,300 Shareholders' Equity 884,932 853,592
Set forth are the Company's results of operations by reportable segmentfor the periods indicated.
RESULTS OF OPERATIONS BY REPORTABLE SEGMENT(1) (Unaudited) (In thousands)
Three Months Ended March 31 ------------------------ 2008 2007 --------- --------- Total segment revenues Gulf of Mexico OCD $ 6,940 $ 16,862 Gulf of Mexico Subsea 24,019 29,405 Latin America 70,172 101,848 West Africa 40,617 51,274 Middle East 85,509 9,411 Asia Pacific/India 82,008 80,216 --------- --------- 309,265 289,016 --------- --------- Intersegment eliminations Gulf of Mexico OCD -- (2,139) Gulf of Mexico Subsea (6,038) (1,774) Middle East (1,762) (8,094) --------- --------- (7,800) (12,007) --------- --------- Consolidated revenues $ 301,465 $ 277,009 ========= =========
Income (loss) before taxes Gulf of Mexico OCD $ (7,930) $ (1,209) Gulf of Mexico Subsea (1,574) 10,609 Latin America 17,824 53,308 West Africa (6,203) 509 Middle East 17,969 1,519 Asia Pacific/India 12,639 11,593 Corporate interest income (expense) 4,231 2,465 --------- --------- Consolidated income before taxes $ 36,956 $ 78,794 ========= =========
(1) Financial information in the above table reflects reorganized reportable segments which were aligned in 2007.
SOURCE Global Industries, Ltd.
