UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 22, 2004
HELMERICH & PAYNE, INC.
1-4221
73-0679879
(Commission File
(I.R.S. Employer
Number)
Identification
Number)
|
1437 South Boulder Avenue, Tulsa, Oklahoma
|
74119 | |
|
|
||
|
(Address of Principal Executive Offices)
|
(Zip Code) | |
(918) 742-5531
N/A
| ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION | ||||||||
| SIGNATURES | ||||||||
| EXHIBIT INDEX | ||||||||
| Earnings Press Release | ||||||||
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On April 22, 2004, Helmerich & Payne, Inc. (“Registrant”) issued a press release announcing its financial results for its second quarter ended March 31, 2004. A copy of the press release is attached as Exhibit 99 to this Report on Form 8-K. This information is being furnished pursuant to Item 12 of Form 8-K and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly authorized the undersigned to sign this report on its behalf.
|
|
HELMERICH & PAYNE, INC. | |
|
|
|
|
By: | /s/ Steven R. Mackey | ||
|
|
|
|||
|
|
Name: Steven R. Mackey | |||
|
|
Title: Vice President | |||
Dated: April 22, 2004
EXHIBIT INDEX
Exhibit No.
Description
Helmerich & Payne, Inc. earnings press release dated April 22, 2004
Exhibit 99
April 22, 2004
HELMERICH & PAYNE, INC. ANNOUNCES SECOND QUARTER RESULTS
Helmerich & Payne, Inc. reported net income of $6,048,000 ($0.12 per diluted share) from revenues of $151,186,000 for its second fiscal quarter ended March 31, 2004, compared with net income of $2,574,000 ($0.05 per diluted share) from revenues of $126,320,000 during last year’s second fiscal quarter ended March 31, 2003. Net income for this year’s second quarter includes $4,337,000 ($0.09 per share) of after-tax gains from the sale of portfolio securities. There were no material gains from portfolio sales in last year’s second quarter.
Although net income for the Company was up compared with both last year’s second quarter and this year’s first quarter, total operating profit from the Company’s core contract drilling operations was down from both comparative periods. The primary reasons for the decline were a $1.4 million currency devaluation loss in Venezuela (previously announced February 13, 2004), reduced profitability in the Company’s offshore platform rig segment, and higher depreciation expenses due to four additional FlexRigs® brought into service during the first and second quarter. The decline from the previous quarter was further accentuated by decreases in rig activity and profitability in the Company’s operations in Colombia and Ecuador, and the higher effective income tax rate caused by the tax treatment of the devaluation loss in Venezuela.
U.S. Land
U.S. land rig utilization for this year’s second quarter increased to 86%, from 81% the previous quarter and 80% for last year’s second quarter. Cash margins per rig day for the second quarter, ($3,270 per day) were down from the previous quarter ($3,499), but up from last year’s second quarter ($3,038). (See accompanying segment data for complete statistics for all business segments.) Operating profit declined sequentially due to the reduction in operating margin and an $857,000 increase in depreciation expense, even though total revenue days increased by over 7% to 6,758 days in the second quarter.
U. S. Offshore Platform
Operating profit for the U.S. offshore platform rig segment fell slightly sequentially, but was down by roughly 50% compared to last year’s second quarter. During this year’s second quarter, rig utilization for the Company’s 12 rigs was the same as in the previous quarter (42%) but was down from the 50% recorded during last year’s second quarter. Since last year’s second quarter, one rig has been stacked and two rigs that were working on full dayrate were changed to standby status with reduced cash margins. A sixth H&P rig commenced operations in early April, bringing utilization to 50% and adding the potential for modest improvement next quarter.
(over)
Page 2
April 22, 2004
News Release
International
International rig utilization was generally flat with the previous quarter at slightly over 50%, compared with 41% during last year’s second quarter. As mentioned above, segment operating profit was down sequentially due to a currency devaluation loss in Venezuela and declines in activity in Colombia and Ecuador.
Company President and C.E.O., Hans Helmerich commented; “The improvement in activity levels continues to materialize very slowly. This is particularly true for our two most challenging segments, the offshore platform and international operations, which together constitute a third of our rig fleet. We share the hope of many in the industry that while the pace of improvement has been frustrating, the unfolding up cycle will be longer in duration than previous cycles.”
Helmerich & Payne, Inc. (HP/NYSE) is a contract drilling company that owns 88 U.S. land rigs, 12 U.S. platform rigs located in the Gulf of Mexico, 30 rigs located in South America, one rig in Hungary and one rig in Chad, for a total of 132 rigs. The Company currently operates 50 H&P-designed FlexRigs®.
Helmerich & Payne, Inc.’s conference call/webcast, scheduled for this afternoon, is at http://www.firstcallevents.com/service/ajwz403832488gf12.html and will begin at 3:30 ET (2:30 CT). If you are unable to participate during the live webcast, the call will be archived for 60 days on the website listed above as well as on H&P’s website at www.hpinc.com.
The information to be disclosed in the conference call and webcast shall include forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such forward-looking statements are subject to certain risks and uncertainties, as disclosed by H&P from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, H&P’s actual results may differ materially from those indicated or implied by such forward-looking statements.
Contact: Doug Fears
(918) 588-5208
(more)
Page 3
April 22, 2004
HELMERICH & PAYNE, INC.
Unaudited
(in thousands, except per share data)
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||
| Dec. 31 | March 31 | March 31 | ||||||||||||||||||
|
CONSOLIDATED STATEMENTS OF INCOME
|
2003
|
2004
|
2003
|
2004
|
2003
|
|||||||||||||||
|
REVENUES
|
||||||||||||||||||||
|
Operating revenues
|
$ | 134,870 | $ | 143,463 | $ | 125,459 | $ | 278,333 | $ | 237,963 | ||||||||||
|
Income from investments
|
4,024 | 7,723 | 861 | 11,747 | 1,670 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
|
138,894 | 151,186 | 126,320 | 290,080 | 239,633 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
COSTS AND EXPENSES
|
||||||||||||||||||||
|
Direct operating costs
|
93,527 | 104,660 | 87,353 | 198,187 | 168,409 | |||||||||||||||
|
Depreciation
|
22,268 | 23,402 | 19,943 | 45,670 | 38,179 | |||||||||||||||
|
General and administrative
|
9,102 | 9,789 | 11,536 | 18,891 | 22,516 | |||||||||||||||
|
Interest
|
3,222 | 3,112 | 3,032 | 6,334 | 5,802 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
|
128,119 | 140,963 | 121,864 | 269,082 | 234,906 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Income before income taxes and equity
in income (loss) of affiliates
|
10,775 | 10,223 | 4,456 | 20,998 | 4,727 | |||||||||||||||
|
Provision for income taxes
|
4,526 | 4,484 | 1,915 | 9,010 | 2,032 | |||||||||||||||
|
Equity in income (loss) of affiliates
net of income taxes
|
(620 | ) | 309 | 33 | (311 | ) | 486 | |||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
NET INCOME
|
$ | 5,629 | $ | 6,048 | $ | 2,574 | $ | 11,677 | $ | 3,181 | ||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Earnings per common share:
|
||||||||||||||||||||
|
Basic
|
$ | 0.11 | $ | 0.12 | $ | 0.05 | $ | 0.23 | $ | 0.06 | ||||||||||
|
Diluted
|
$ | 0.11 | $ | 0.12 | $ | 0.05 | $ | 0.23 | $ | 0.06 | ||||||||||
|
Average common shares outstanding:
|
||||||||||||||||||||
|
Basic
|
50,154 | 50,263 | 50,023 | 50,209 | 50,001 | |||||||||||||||
|
Diluted
|
50,667 | 50,903 | 50,539 | 50,784 | 50,503 | |||||||||||||||
(more)
Page 4
April 22, 2004
HELMERICH & PAYNE, INC.
Unaudited
(in thousands)
|
CONSOLIDATED CONDENSED BALANCE SHEETS
|
3/31/04
|
9/30/03
|
||||||
|
ASSETS
|
||||||||
|
Cash and cash equivalents
|
$ | 30,558 | $ | 38,189 | ||||
|
Other current assets
|
182,303 | 159,342 | ||||||
|
|
|
|
||||||
|
Total current assets
|
212,861 | 197,531 | ||||||
|
|
|
|
||||||
|
Investments
|
173,195 | 158,770 | ||||||
|
Net property, plant, and equipment
|
1,063,923 | 1,058,205 | ||||||
|
Other assets
|
1,021 | 1,329 | ||||||
|
|
|
|
||||||
|
TOTAL ASSETS
|
$ | 1,451,000 | $ | 1,415,835 | ||||
|
|
|
|
||||||
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
|
Total current liabilities
|
$ | 76,033 | $ | 88,618 | ||||
|
Total noncurrent liabilities
|
237,975 | 209,966 | ||||||
|
Long-term notes payable
|
200,000 | 200,000 | ||||||
|
Total shareholders’ equity
|
936,992 | 917,251 | ||||||
|
|
|
|
||||||
|
TOTAL
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$ | 1,451,000 | $ | 1,415,835 | ||||
|
|
|
|
||||||
(more)
Page 5
April 22, 2004
| Six Months Ended | ||||||||
| March 31 | ||||||||
|
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
|
2004
|
2003
|
||||||
| (Amounts in thousands) | ||||||||
|
OPERATING ACTIVITIES:
|
||||||||
|
Net Income
|
$ | 11,677 | $ | 3,181 | ||||
|
Depreciation
|
45,670 | 38,179 | ||||||
|
Changes in assets and liabilities
|
(12,047 | ) | (1,159 | ) | ||||
|
Gain on sale of assets
|
(8,672 | ) | (827 | ) | ||||
|
Other
|
545 | (294 | ) | |||||
|
|
|
|
||||||
|
Net cash provided by operating activities
|
37,173 | 39,080 | ||||||
|
|
|
|
||||||
|
INVESTING ACTIVITIES:
|
||||||||
|
Capital expenditures
|
(52,657 | ) | (137,803 | ) | ||||
|
Proceeds from sale of assets
|
16,940 | 2,732 | ||||||
|
|
|
|
||||||
|
Net cash used in investing activities
|
(35,717 | ) | (135,071 | ) | ||||
|
|
|
|
||||||
|
FINANCING ACTIVITIES:
|
||||||||
|
Net proceeds (payments) from notes payable
|
(5,000 | ) | 100,000 | |||||
|
Dividends paid
|
( 8,050 | ) | (8,004 | ) | ||||
|
Proceeds from exercise of stock options
|
3,963 | 360 | ||||||
|
|
|
|
||||||
|
Net cash (used in) provided by financing activities
|
( 9,087 | ) | 92,356 | |||||
|
|
|
|
||||||
|
Net decrease in cash and cash equivalents
|
( 7,631 | ) | (3,635 | ) | ||||
|
Cash and cash equivalents, beginning of period
|
38,189 | 46,883 | ||||||
|
|
|
|
||||||
|
Cash and cash equivalents, end of period
|
$ | 30,558 | $ | 43,248 | ||||
|
|
|
|
||||||
(more)
Page 6
April 22, 2004
SEGMENT REPORTING
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||
|
Dec. 31
|
March 31
|
March 31
|
||||||||||||||||||
|
2003
|
2004
|
2003
|
2004
|
2003
|
||||||||||||||||
| (Amounts in thousands, except operating statistics) | ||||||||||||||||||||
|
US LAND OPERATIONS
|
||||||||||||||||||||
|
Revenues
|
$ | 75,468 | $ | 83,045 | $ | 65,412 | $ | 158,513 | $ | 124,450 | ||||||||||
|
Direct operating expenses
|
53,490 | 60,943 | 49,136 | 114,433 | 94,992 | |||||||||||||||
|
General and administrative expense
|
1,925 | 1,867 | 2,148 | 3,792 | 5,485 | |||||||||||||||
|
Depreciation
|
13,063 | 13,920 | 10,484 | 26,983 | 19,434 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Operating profit
|
$ | 6,990 | $ | 6,315 | $ | 3,644 | $ | 13,305 | 4,539 | |||||||||||
|
Activity days
|
6,280 | 6,758 | 5,357 | 13,038 | 10,372 | |||||||||||||||
|
Average rig revenue per day
|
$ | 11,340 | $ | 11,302 | $ | 11,428 | $ | 11,320 | $ | 11,377 | ||||||||||
|
Average rig expense per day
|
$ | 7,841 | $ | 8,032 | $ | 8,390 | $ | 7,940 | $ | 8,536 | ||||||||||
|
Average rig margin per day
|
$ | 3,499 | $ | 3,270 | $ | 3,038 | $ | 3,380 | $ | 2,841 | ||||||||||
|
Rig utilization
|
81 | % | 86 | % | 80 | % | 83 | % | 80 | % | ||||||||||
|
US OFFSHORE OPERATIONS
|
||||||||||||||||||||
|
Revenues
|
$ | 20,865 | $ | 18,901 | $ | 28,079 | $ | 39,766 | $ | 55,790 | ||||||||||
|
Direct operating expenses
|
12,722 | 10,997 | 15,420 | 23,719 | 31,519 | |||||||||||||||
|
General and administrative expense
|
729 | 767 | 849 | 1,496 | 1,588 | |||||||||||||||
|
Depreciation
|
3,039 | 3,031 | 3,187 | 6,070 | 6,329 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Operating profit
|
$ | 4,375 | $ | 4,106 | $ | 8,623 | $ | 8,481 | $ | 16,354 | ||||||||||
|
Activity days
|
460 | 455 | 540 | 915 | 1,112 | |||||||||||||||
|
Average rig revenue per day
|
$ | 32,790 | $ | 29,276 | $ | 38,146 | $ | 31,042 | $ | 37,084 | ||||||||||
|
Average rig expense per day
|
$ | 17,584 | $ | 14,481 | $ | 17,794 | $ | 16,041 | $ | 17,824 | ||||||||||
|
Average rig margin per day
|
$ | 15,206 | $ | 14,795 | $ | 20,352 | $ | 15,001 | $ | 19,260 | ||||||||||
|
Rig utilization
|
42 | % | 42 | % | 50 | % | 42 | % | 51 | % | ||||||||||
(more)
Page 7
April 22, 2004
SEGMENT REPORTING
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||
| Dec. 31 | March 31 | March 31 | ||||||||||||||||||
|
2003
|
2004
|
2003
|
2004
|
2003
|
||||||||||||||||
| (Amounts in thousands) | ||||||||||||||||||||
|
INTERNATIONAL OPERATIONS
|
||||||||||||||||||||
|
Revenues
|
$ | 36,144 | $ | 39,277 | $ | 29,451 | $ | 75,421 | $ | 52,975 | ||||||||||
|
Direct operating expenses
|
26,672 | 32,056 | 22,257 | 58,728 | 40,752 | |||||||||||||||
|
General and administrative expense
|
628 | 561 | 964 | 1,189 | 1,682 | |||||||||||||||
|
Depreciation
|
5,021 | 5,139 | 4,982 | 10,160 | 9,885 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Operating profit
|
$ | 3,823 | $ | 1,521 | $ | 1,248 | $ | 5,344 | $ | 656 | ||||||||||
|
Activity days
|
1,534 | 1,473 | 1,205 | 3,007 | 2,196 | |||||||||||||||
|
Average rig revenue per day
|
$ | 19,208 | $ | 21,826 | $ | 19,439 | $ | 20,490 | $ | 19,092 | ||||||||||
|
Average rig expense per day
|
$ | 13,399 | $ | 16,645 | $ | 14,146 | $ | 14,988 | $ | 14,447 | ||||||||||
|
Average rig margin per day
|
$ | 5,809 | $ | 5,181 | $ | 5,293 | $ | 5,502 | $ | 4,645 | ||||||||||
|
Rig utilization
|
53 | % | 51 | % | 41 | % | 52 | % | 37 | % | ||||||||||
Per day calculations for international operations exclude gains and losses from translation of foreign currency transactions.
Operating statistics exclude the effects of offshore platform management contracts, and do not include reimbursements of “out-of-pocket” expenses in revenue per day, expense per day and margin calculations.
Reimbursed amounts were as follows:
(more)
$
4,252
$
6,666
$
4,193
$
10,918
$
6,453
$
1,601
$
1,551
$
2,584
$
3,152
$
4,590
$
3,261
$
3,510
$
2,748
$
6,771
$
4,468
$
2,393
$
2,240
$
2,517
$
4,633
$
4,748
613
632
494
1,245
924
524
561
663
1,085
1,298
$
1,256
$
1,047
$
1,360
$
2,303
$
2,526
Page 8
April 22, 2004
SEGMENT REPORTING
The following table reconciles segment operating profit per the information above to income before income taxes and equity in income of affiliates as reported on the Consolidated Condensed Statements of Income (in thousands).
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||
| Dec. 31 | March 31 | March 31 | ||||||||||||||||||
|
2003
|
2004
|
2003
|
2004
|
2003
|
||||||||||||||||
|
Operating Profit
|
||||||||||||||||||||
|
US Land
|
$ | 6,990 | $ | 6,315 | $ | 3,644 | $ | 13,305 | $ | 4,539 | ||||||||||
|
US Offshore
|
4,375 | 4,106 | 8,623 | 8,481 | 16,354 | |||||||||||||||
|
International
|
3,823 | 1,521 | 1,248 | 5,344 | 656 | |||||||||||||||
|
Real Estate
|
1,256 | 1,047 | 1,360 | 2,303 | 2,526 | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Segment operating profits
|
$ | 16,444 | $ | 12,989 | $ | 14,875 | $ | 29,433 | $ | 24,075 | ||||||||||
|
Unallocated amounts:
|
||||||||||||||||||||
|
Income from investments
|
4,024 | 7,723 | 861 | 11,747 | 1,670 | |||||||||||||||
|
Corporate general & administrative
|
(5,820 | ) | (6,594 | ) | (7,575 | ) | (12,414 | ) | (13,761 | ) | ||||||||||
|
Interest expense
|
(3,222 | ) | (3,112 | ) | (3,032 | ) | (6,334 | ) | (5,802 | ) | ||||||||||
|
Other depreciation
|
(621 | ) | (751 | ) | (627 | ) | (1,372 | ) | (1,233 | ) | ||||||||||
|
Other expense
|
(30 | ) | (32 | ) | (46 | ) | (62 | ) | (222 | ) | ||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Total unallocated amounts
|
(5,669 | ) | (2,766 | ) | (10,419 | ) | (8,435 | ) | (19,348 | ) | ||||||||||
|
Income before income taxes and equity
in income (loss) of affiliates
|
$ | 10,775 | $ | 10,223 | $ | 4,456 | $ | 20,998 | $ | 4,727 | ||||||||||
|
|
|
|
|
|
|
|||||||||||||||
###