Vantage Drilling International Reports Second Quarter Results for 2020

8/6, 11:00 AM (Source: GlobeNewswire)

HOUSTON, Aug. 06, 2020 (GLOBE NEWSWIRE) -- Vantage Drilling International ("Vantage" or the “Company”) reported a net loss attributable to controlling interest of approximately $31.9 million or $2.43 per diluted share for the three months ended June 30, 2020, based on the weighted average shares outstanding after the conversion of our convertible notes in December 2019, as compared to a net income attributable to controlling interest of $590.7 million or $116.86 per diluted share for the three months ended June 30, 2019.

Net income for the three months ended June 30, 2019, included payments by Petrobras Venezuela Investments & Services, BV, a subsidiary of Petroleo Brasileiro S.A. (“Petrobras”), of approximately $690.8 million to Vantage Deepwater Company, one of our subsidiaries, and by Petrobras America, Inc., a subsidiary of Petrobras, of approximately $10.1 million to Vantage Deepwater Drilling, Inc., also one of our subsidiaries.  The payments were made pursuant to an agreement between the parties and in satisfaction of the previously rendered arbitration award and related U.S. judgment confirming the award.

As of June 30, 2020, Vantage had approximately $188.4 million in cash, including $13.1 million of restricted cash, compared to $242.9 million in cash, including $11.0 million of restricted cash at December 31, 2019.  

Ihab Toma, CEO, commented. “Despite the very challenging conditions for offshore drilling during the COVID-19 pandemic and economic crisis, we successfully completed the first ever well offshore Lebanon with the Tungsten Explorer during the second quarter and were awarded a new contract in Montenegro for the Topaz Driller. I am personally very proud of the quality and motivation of our employees and their focus on our customers, which allowed us to continue to deliver a strong performance across our operating fleet. We remain committed to maintaining this performance while operating safely and managing costs. During the quarter we commenced a plan to reduce costs across the board. We secured material price reductions from vendors, initiated significant headcount and salary reductions both onshore and offshore and implemented other cost reduction measures to reflect the lower levels of operating activity.  While the decision to reduce personnel was difficult, we remain committed to seek measures to reduce our spending and to conserve cash while remaining focused on performance, but never at the expense of safety.”

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with a fleet of three ultra-deepwater drillships and five premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells globally for major, national and independent oil and natural gas companies. Vantage also provides construction supervision services and preservation management services for, and will operate and manage, drilling units owned by others.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the company's filings with the Securities and Exchange Commission. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements.  Vantage disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Public & Investor Relations Contact:

     Douglas E. Stewart
     Chief Financial Officer and General Counsel
     Vantage Drilling International
     C/O Vantage Energy Services, Inc.
     777 Post Oak Blvd., Suite 800
     Houston, Texas 77056
     (281) 404-4700

 
 
Vantage Drilling International
Consolidated Statement of Operations
(In thousands, except per share data)
(Unaudited)
  Three Months Ended June 30, Six Months Ended June 30, 
   2020   2019   2020   2019  
Revenue         
Contract drilling services $33,151  $35,765  $77,470  $65,745  
Contract termination revenue     594,029      594,029  
Reimbursables and other  3,624   6,589   10,761   11,164  
Total revenue  36,775   636,383   88,231   670,938  
Operating costs and expenses         
Operating costs  38,104   38,081   86,659   76,623  
General and administrative  4,716   70,702   11,886   79,370  
Depreciation  18,401   18,499   36,417   37,032  
Total operating costs and expenses  61,221   127,282   134,962   193,025  
(Loss) income from operations  (24,446)  509,101   (46,731)  477,913  
Other income (expense)         
Interest income  111   108,305   812   109,369  
Interest expense and other financing charges  (8,601)  (10,435)  (17,021)  (26,250) 
Other, net  12   (58)  2,367   124  
Total other (expense) income  (8,478)  97,812   (13,842)  83,243  
(Loss) income before income taxes  (32,924)  606,913   (60,573)  561,156  
Income tax (benefit) provision  (1,024)  16,454   1,897   18,601  
Net (loss) income  (31,900)  590,459   (62,470)  542,555  
Net income (loss) attributable to noncontrolling interests  12   (270)  14   (284) 
Net (loss) income attributable to shareholders $(31,912) $590,729  $(62,484) $542,839  
(Loss) earnings per share         
Basic $(2.43) $116.96  $(4.76) $107.60  
Diluted $(2.43) $116.86  $(4.76) $107.38  
          
Weighted average ordinary shares outstanding         
Basic  13,115   5,051   13,115   5,045  
Diluted  13,115   5,056   13,115   5,055  
          
  
Vantage Drilling International 
Supplemental Operating Data 
(Unaudited, in thousands, except percentages) 
  
  Three Months Ended June 30, Six Months Ended June 30, 
   2020   2019   2020   2019  
Operating costs and expenses         
Jackups $15,669  $14,108  $37,142  $31,853  
Deepwater  18,831   16,492   38,870   32,307  
Operations support  2,016   3,361   5,453   6,460  
Reimbursables  1,588   4,120   5,194   6,003  
  $38,104  $38,081  $86,659  $76,623  
          
Utilization         
Jackups  60.0%  93.7%  73.9%  96.0% 
Deepwater  45.6%  49.2%  53.7%  40.9% 


  
Vantage Drilling International 
Consolidated Balance Sheet 
(In thousands, except share and par value information) 
(Unaudited) 
      
  June 30, 2020 December 31, 2019 
      
ASSETS     
Current assets     
Cash and cash equivalents $175,311  $231,947  
Restricted cash  3,667   2,511  
Trade receivables  53,706   46,504  
Inventory  50,684   48,368  
Prepaid expenses and other current assets  13,429   16,507  
Total current assets  296,797   345,837  
Property and equipment     
Property and equipment  1,003,844   1,002,968  
Accumulated depreciation  (318,135)  (281,842) 
Property and equipment, net  685,709   721,126  
Operating lease ROU assets  4,805   6,706  
Other assets  16,571   17,068  
Total assets $1,003,882  $1,090,737  
      
LIABILITIES AND SHAREHOLDERS' EQUITY     
Current liabilities     
Accounts payable $32,641  $49,599  
Other current liabilities  21,685   26,936  
Total current liabilities  54,326   76,535  
Long–term debt, net of discount and financing costs of $5,601 and $6,421, respectively  344,399   343,579  
Other long-term liabilities  15,712   17,532  
Commitments and contingencies     
Shareholders' equity     
Ordinary shares, $0.001 par value, 50 million shares authorized; 13,115,026 shares issued and outstanding, respectively  13   13  
Additional paid-in capital  633,594   634,770  
Accumulated (deficit) earnings  (45,420)  17,064  
Controlling interest shareholders' equity  588,187   651,847  
Noncontrolling interests  1,258   1,244  
Total equity  589,445   653,091  
Total liabilities and shareholders' equity $1,003,882  $1,090,737  
      
      



Vantage Drilling International
Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
  Six Months Ended June 30, 
   2020   2019  
CASH FLOWS FROM OPERATING ACTIVITIES     
Net (loss) income $(62,470) $542,555  
Adjustments to reconcile net income to net cash (used in) provided by operating activities     
Depreciation expense  36,417   37,032  
Amortization of debt financing costs  820   807  
Amortization of debt discount     5,354  
Amortization of contract value     1,643  
PIK interest on the Convertible Notes     3,845  
Share-based compensation expense  1,028   2,064  
Deferred income tax (benefit) expense  (90)  497  
Loss on disposal of assets     109  
Gain on settlement of restructuring agreement  (2,278)    
Changes in operating assets and liabilities:     
Trade receivables  (7,202)  (3,047) 
Inventory  (1,297)  (266) 
Prepaid expenses and other current assets  2,545   (2,274) 
Other assets  3,410   2,641  
Accounts payable  (14,680)  63,527  
Other current liabilities and other long-term liabilities  (8,717)  8,799  
Net cash (used in) provided by operating activities  (52,514)  663,286  
CASH FLOWS FROM INVESTING ACTIVITIES     
Additions to property and equipment  (2,021)  (6,606) 
Net cash used in investing activities  (2,021)  (6,606) 
CASH FLOWS FROM FINANCING ACTIVITIES     
Contributions from holders of noncontrolling interests     1,181  
Debt issuance costs     (487) 
Net cash provided by financing activities     694  
Net (decrease) increase in unrestricted and restricted cash and cash equivalents  (54,535)  657,374  
Unrestricted and restricted cash and cash equivalents—beginning of period  242,944   239,387  
Unrestricted and restricted cash and cash equivalents—end of period $188,409  $896,761  
      


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