(Source: PRNewswire)THE WOODLANDS, Texas, April 30 /PRNewswire-FirstCall/ -- Newpark Resources, Inc. (NYSE: NR) today announced results for its first quarter ended March 31, 2009. Total revenues were $126.9 million for the first quarter of 2009 compared to $194.7 million for the first quarter of 2008. The Company reported a net loss of $12.0 million, or $0.14 loss per share, for the first quarter of 2009 compared to net income of $11.4 million, or $0.13 per diluted share, in the first quarter of 2008.

Operating results in the first quarter of 2009 included pre-tax employee termination and related charges of $2.6 million ($1.7 million after-tax) associated with North American workforce reductions. In addition, the effective tax rate for the first quarter 2009, which had a pre-tax loss of $14.5 million, was 17%, resulting in a benefit from income taxes of $2.5 million, compared to an effective tax rate of 33% in the first quarter of 2008. The low effective tax rate in the first quarter of 2009 is primarily due to the write-off of a previously recognized net operating loss carryforward tax asset in Canada, along with losses generated in certain foreign countries during the quarter, for which the recording of a tax benefit is not permitted.

Paul Howes, President and Chief Executive Officer of Newpark, stated, "Our first quarter results were negatively impacted by the sharp decline in North American drilling activity, driven by the decline in natural gas prices. In response to these lower levels of activity, we initiated further cost cutting programs during the first quarter of 2009 to reduce headcount and operating costs. Since the beginning of 2009, we have reduced our North American headcount by 28%. However, the benefits of the cost reduction initiatives had less impact on our first quarter results due to the timing of the actions, along with employee termination costs related to the headcount reductions. Having taken steps to right-size the business during this period, we believe our cost structure is now better aligned with current revenue levels. Internationally, our business performed better during the quarter and our business in Brazil, which is tied to deepwater offshore production, is expected to perform well in 2009.

"The first quarter loss was further negatively impacted by the unusually low tax rate, which served to increase our net loss by $0.03 per share. Despite the operational challenges, we were still able to reduce our total debt by $25 million during the quarter," concluded Howes.

Segment Results

The Fluids Systems and Engineering segment generated revenues of $106.6 million and an operating loss of $5.6 million in the first quarter of 2009 compared to revenues of $157.2 million and operating income of $21.1 million during the first quarter of 2008. The decline in revenues was due to a substantially lower U.S. rig count in the first quarter compared to the same period a year ago. North American revenues decreased 39% compared to the first quarter of 2008. Mediterranean revenues declined 11%, primarily due to the strengthening U.S. dollar as international revenue levels remained relatively stable in local currency terms. Revenues from Brazil increased in the first quarter due to the ramp-up in activity from 2008 contract agreements. The decline in operating income in this segment is primarily the result of the rapid decline in U.S. drilling activity and severe pricing pressures.

The Mats and Integrated Services segment generated revenues of $8.9 million and an operating loss of $3.4 million in the first quarter of 2009 compared to revenues of $21.3 million and an operating profit of $0.1 million in the first quarter of 2008. The decline in revenues is primarily attributable to weakness in the Gulf Coast region as revenues in the Rocky Mountain market remained relatively stable compared to the prior year quarter.

The Environmental Services segment, which is now back in continuing operations, generated revenues of $11.5 million and operating income of $1.2 million, reflecting a 10.1% operating margin, in the first quarter of 2009. This compares to revenues of $16.3 million and operating income of $4.2 million, reflecting a 26.0% operating margin in the first quarter of 2008. The decline in revenues in this segment is primarily due to the decline in Gulf Coast rig activity, somewhat offset by changes in sales mix and price increases.

CONFERENCE CALL

In conjunction with this release, Newpark has scheduled a conference call, which will be broadcast live over the Internet, on Friday, May 1, 2009 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time.