UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF EARLIEST EVENT REPORTED: April 27, 2005

HELMERICH & PAYNE, INC.

(Exact name of registrant as specified in its charter)

State of Incorporation: Delaware

COMMISSION FILE NUMBER 1-4221

Internal Revenue Service – Employer Identification No. 73-0679879

1437 South Boulder Avenue, Suite 1400, Tulsa, Oklahoma 74119
(918)742-5531

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 

 

 

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

      On April 27, 2005, Helmerich & Payne, Inc. (“Registrant”) issued a press release announcing its financial results for its second quarter ended March 31, 2005. 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 2.02 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.

(Registrant)
  		 
  /s/ Steven R. Mackey    
  Steven R. Mackey   
  Vice President


DATE: April 27, 2005 		 
 

EXHIBIT INDEX

     
Exhibit No.   Description
99
  Helmerich & Payne, Inc. earnings press release dated April 27, 2005

-2-

 

Exhibit 99

April 27, 2005

HELMERICH & PAYNE, INC. ANNOUNCES SECOND QUARTER RESULTS
AND NEW RIG CONSTRUCTION FOR CONOCOPHILLIPS

       Helmerich & Payne, Inc. reported net income of $22,350,000 ($0.43 per diluted share) from operating revenues of $185,450,000 for its second fiscal quarter ended March 31, 2005, compared with net income of $6,048,000 ($0.12 per diluted share) from operating revenues of $143,024,000 during last year’s second fiscal quarter ended March 31, 2004. Included in net income were gains from the sale of portfolio securities and drilling equipment of $0.01 per share for this year’s second quarter and $0.09 per share for last year’s second quarter.

       For the six months ended March 31, 2005, the Company reported net income of $61,660,000 ($1.20 per diluted share) from operating revenues of $360,129,000, compared with net income of $12,636,000 ($0.25 per diluted share) from operating revenues of $277,297,000 during the first six months ended March 31, 2004. Included in net income were gains from the sale of portfolio securities and drilling equipment of $0.45 per share for the first six months of fiscal 2005 and $0.16 per share for the first six months of fiscal 2004.

       Company President and CEO, Hans Helmerich commented, “The U.S. land business continues to improve, fueled by strong energy prices. Customers are paying more for rigs across the board and are particularly attracted to the consistent performance and added drilling efficiency that our fleet offers. During the second quarter, cash margins for our U.S. land fleet increased by $1,381 over the previous quarter, driving operating income up by 40% during that same period.

       As expected, our U.S. platform business was steady during the second quarter, while our international segment results were hampered by a $1,555,000 Venezuelan currency revaluation expense, reduction in operating income in Bolivia and Equatorial Guinea, and expenses associated with terminating operations in Chad and Hungary.”

       As previously announced on March 23rd, the Company has been contracted by Williams Production RMT Company to operate 10 new FlexRig4s®, each under three-year term contracts at a fixed dayrate plus certain conditional incentive payments based upon savings realized by Williams. The first rig is scheduled for completion by November 2005, with the remaining nine expected to be delivered to the field at the rate of one per month thereafter.

       The Company announced today that it had received a letter of intent from ConocoPhillips to operate three new FlexRig4 drilling rigs. ConocoPhillips will contract the new FlexRig4s on three-year term contracts for work in the San Juan Basin in northwestern New Mexico. The Company expects to deliver one new rig per month starting November 2005. The new rigs and transportation equipment are expected to cost the Company approximately $9.5 million each.

       Mr. Helmerich added, “We are pleased to be awarded the contract resulting in the construction of three new FlexRig4 rigs for ConocoPhillips. This work represents further validation of the FlexRig’s superior field performance and drilling efficiencies. Building on strong customer satisfaction with our existing 50 FlexRigs, these new FlexRig4s will provide enhanced project economics for the customer and allow us to secure term contracts with attractive financial returns for our shareholders.”

 

 

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Page 2
April 27, 2005
News Release

       Helmerich & Payne, Inc. (HP/NYSE) is a contract drilling company that owns 91 U.S. land rigs, 11 U.S. platform rigs located in the Gulf of Mexico, 26 rigs located in South America, for a total of 128 rigs. Included in the total fleet of 128 rigs are 50 H&P-designed and operated FlexRigs.

       Helmerich & Payne, Inc.’s conference call/webcast is scheduled for this morning and can be accessed at http://www.hpinc.com under Investor Relations and will begin at 11:00 a.m. ET (10:00 a.m. CT). If you are unable to participate during the live webcast, the call will be archived for a year on H&P’s website indicated above.

       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 in its Form 10-K filed with the Securities and Exchange Commission on December 13, 2004. As a result of these factors, H&P’s actual results may differ materially from those indicated or implied by such forward-looking statements.

*FlexRig® is a registered trademark of Helmerich & Payne, Inc.

Contact: Doug Fears
(918) 588-5208

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Page 3
News Release
April 27, 2005

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   2004     2005     2004     2005     2004  
Operating Revenues:
                                       
Drilling – U.S. Land
  $ 109,188     $ 122,394     $ 82,477     $ 231,582     $ 157,410  
Drilling – U.S. Offshore
    20,356       18,649       18,675       39,005       39,377  
Drilling – International
    42,471       41,799       39,311       84,270       75,272  
Real Estate
    2,664       2,608       2,561       5,272       5,238  
 
                             
 
    174,679       185,450       143,024       360,129       277,297  
 
                             
 
                                       
Operating costs and expenses:
                                       
Operating costs
    111,252       114,321       104,950       225,573       198,731  
Depreciation
    23,262       23,950       23,402       47,212       45,670  
General and administrative
    9,246       9,593       9,789       18,839       18,891  
 
                             
 
    143,760       147,864       138,141       291,624       263,292  
 
                             
 
                                       
Operating income
    30,919       37,586       4,883       68,505       14,005  
 
                                       
Other income (expense):
                                       
Interest and dividend income
    961       1,193       516       2,154       1,161  
Interest expense
    (3,309 )     (3,246 )     (3,112 )     (6,555 )     (6,334 )
Gain on sale of investment securities
    26,349       (36 )     7,072       26,313       11,976  
Income from asset sales
    10,816       971       755       11,787       1,636  
Other
    (2 )     348       109       346       118  
 
                             
 
    34,815       (770 )     5,340       34,045       8,557  
 
                             
Income before income taxes and equity in income (loss) of affiliates
    65,734       36,816       10,223       102,550       22,562  
Income tax provision
    27,130       15,153       4,484       42,283       9,615  
Equity in income (loss) of affiliates net of income taxes
    706       687       309       1,393       (311 )
 
                             
NET INCOME
  $ 39,310     $ 22,350     $ 6,048     $ 61,660     $ 12,636  
 
                             
 
                                       
Earnings (loss) per common share:
                                       
Basic
  $ 0.78     $ 0.44     $ 0.12     $ 1.22     $ 0.25  
Diluted
  $ 0.77     $ 0.43     $ 0.12     $ 1.20     $ 0.25  
 
                                       
Average common shares outstanding:
                                       
Basic
    50,543       50,955       50,263       50,747       50,209  
Diluted
    51,256       51,891       50,903       51,571       50,784  

(more)

 

 

Page 4
News Release
April 27, 2005

HELMERICH & PAYNE, INC.
Unaudited
(in thousands)

                 
CONSOLIDATED CONDENSED BALANCE SHEETS   3/31/05     9/30/04  
ASSETS
               
Cash and cash equivalents
  $ 208,453     $ 65,296  
Other current assets
    184,479       180,590  
 
           
Total current assets
    392,932       245,886  
 
           
Investments
    157,076       161,532  
Net property, plant, and equipment
    959,487       998,674  
Other assets
    662       752  
 
           
TOTAL ASSETS
  $ 1,510,157     $ 1,406,844  
 
           
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Total current liabilities
  $ 55,721     $ 59,903  
Total noncurrent liabilities
    264,736       232,831  
Long-term notes payable
    200,000       200,000  
Total shareholders’ equity
    989,700       914,110  
 
           
 
               
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
  $ 1,510,157     $ 1,406,844  
 
           

(more)

 

 

Page 5
News Release
April 27, 2005

HELMERICH & PAYNE, INC.
Unaudited
(in thousands)

                 
    Six Months Ended  
    March 31  
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS   2005     2004  
OPERATING ACTIVITIES:
               
Net Income
  $ 61,660     $ 12,636  
Depreciation
    47,212       45,670  
Changes in assets and liabilities
    9,901       (8,067 )
Gain on sale of assets and investment securities
    (38,100 )     (11,666 )
Non-monetary investment gain
    —       (1,946 )
Other
    (2,584 )     546  
 
           
Net cash provided by operating activities
    78,089       37,173  
 
           
 
               
INVESTING ACTIVITIES:
               
Capital expenditures
    (22,693 )     (52,657 )
Purchase of investments
    (5,000 )     —  
Proceeds from sale of assets and investment securities
    89,298       16,940  
 
           
Net cash provided by (used in) investing activities
    61,605       (35,717 )
 
           
 
               
FINANCING ACTIVITIES:
               
Payments of short-term notes
    —       (5,000 )
Dividends paid
    (8,380 )     (8,050 )
Proceeds from exercise of stock options
    11,843       3,963  
 
           
Net cash provided by (used in) financing activities
    3,463       (9,087 )
 
           
 
               
Net increase (decrease) in cash and cash equivalents
    143,157       (7,631 )
Cash and cash equivalents, beginning of period
    65,296       38,189  
 
           
Cash and cash equivalents, end of period
  $ 208,453     $ 30,558  
 
           

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Page 6
News Release
April 27, 2005

                                         
SEGMENT REPORTING   Three Months Ended     Six Months Ended  
    Dec. 31     March 31     March 31  
    2004     2005     2004     2005     2004  
    (in thousands, except days and per day amounts)  
US LAND OPERATIONS
                                       
Revenues
  $ 109,188     $ 122,394     $ 82,477     $ 231,582     $ 157,410  
Direct operating expenses
    66,978       69,695       60,943       136,673       114,433  
General and administrative expense
    1,866       1,839       1,867       3,705       3,792  
Depreciation
    14,756       15,063       13,920       29,819       26,983  
 
                             
Operating income
  $ 25,588     $ 35,797     $ 5,747     $ 61,385     $ 12,202  
 
                                       
Activity days
    7,588       7,589       6,758       15,177       13,038  
Average rig revenue per day
  $ 13,363     $ 15,018     $ 11,218     $ 14,191     $ 11,236  
Average rig expense per day
  $ 7,800     $ 8,074     $ 8,032     $ 7,938     $ 7,940  
Average rig margin per day
  $ 5,563     $ 6,944     $ 3,186     $ 6,253     $ 3,296  
Rig utilization
    92 %     94 %     86 %     93 %     83 %
 
                                       
US OFFSHORE OPERATIONS
                                       
Revenues
  $ 20,356     $ 18,649     $ 18,675     $ 39,005     $ 39,377  
Direct operating expenses
    12,847       10,992       10,997       23,839       23,719  
General and administrative expense
    834       817       767       1,651       1,496  
Depreciation
    2,507       2,668       3,031       5,175       6,070  
 
                             
Operating income
  $ 4,168     $ 4,172     $ 3,880     $ 8,340     $ 8,092  
 
                                       
Activity days
    563       450       455       1,013       915  
Average rig revenue per day
  $ 25,793     $ 29,297     $ 28,644     $ 27,350     $ 30,617  
Average rig expense per day
  $ 14,251     $ 14,928     $ 14,481     $ 14,552     $ 16,041  
Average rig margin per day
  $ 11,542     $ 14,369     $ 14,163     $ 12,798     $ 14,576  
Rig utilization
    56 %     45 %     42 %     51 %     42 %

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Page 7
News Release
April 27, 2005

                                         
SEGMENT REPORTING   Three Months Ended     Six Months Ended  
    Dec. 31     March 31     March 31  
    2004     2005     2004     2005     2004  
    (in thousands, except days and per day amounts)  
INTERNATIONAL OPERATIONS
                                       
Revenues
  $ 42,471     $ 41,799     $ 39,311     $ 84,270     $ 75,272  
Direct operating expenses
    30,855       32,920       32,056       63,775       58,728  
General and administrative expense
    653       497       561       1,150       1,189  
Depreciation
    4,766       4,800       5,139       9,566       10,160  
 
                             
Operating income
  $ 6,197     $ 3,582     $ 1,555     $ 9,779     $ 5,195  
 
                                       
Activity days
    1,823       1,728       1,473       3,551       3,007  
Average rig revenue per day
  $ 19,208     $ 19,430     $ 21,849     $ 19,316     $ 20,441  
Average rig expense per day
  $ 13,346     $ 13,672     $ 16,645     $ 13,504     $ 14,988  
Average rig margin per day
  $ 5,862     $ 5,758     $ 5,204     $ 5,812     $ 5,453  
Rig utilization
    71 %     71 %     51 %     71 %     52 %

Per day calculations for international operations exclude gains and losses from translation of foreign currency transactions.

Operating statistics exclude the effects of offshore platform and international 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:

                                         
US Land Operations
  $ 7,789     $ 8,419     $ 6,666     $ 16,208     $ 10,918  
US Offshore Operations
  $ 1,471     $ 1,410     $ 1,551     $ 2,881     $ 3,152  
International Operations
  $ 3,099     $ 3,794     $ 3,510     $ 6,893     $ 6,771  
 
                                       
REAL ESTATE
                                       
Revenues
  $ 2,664     $ 2,608     $ 2,561     $ 5,272     $ 5,238  
Direct operating expenses
    1,027       1,174       954       2,201       1,851  
Depreciation
    562       573       561       1,135       1,085  
 
                             
Operating income
  $ 1,075     $ 861     $ 1,046     $ 1,936     $ 2,302  

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Page 8
News Release
April 27, 2005

The following table reconciles operating income per the information above to income before income taxes and equity in income (loss) of affiliates as reported on the Consolidated Statements of Income (in thousands).

                                         
SEGMENT REPORTING   Three Months Ended     Six Months Ended  
    Dec. 31     March 31     March 31  
    2004     2005     2004     2005     2004  
Operating income
                                       
US Land
  $ 25,588     $ 35,797     $ 5,747     $ 61,385     $ 12,202  
US Offshore
    4,168       4,172       3,880       8,340       8,092  
International
    6,197       3,582       1,555       9,779       5,195  
Real Estate
    1,075       861       1,046       1,936       2,302  
 
                             
Segment operating income
  $ 37,028     $ 44,412     $ 12,228     $ 81,440     $ 27,791  
Corporate general and administrative
    (5,893 )     (6,440 )     (6,594 )     (12,333 )     (12,414 )
Other depreciation
    (671 )     (846 )     (751 )     (1,517 )     (1,372 )
Inter-segment elimination
    455       460       —       915       —  
 
                             
Operating income
  $ 30,919     $ 37,586     $ 4,883     $ 68,505     $ 14,005  
 
                                       
Other income (expense):
                                       
Interest and dividend income
    961       1,193       516       2,154       1,161  
Interest expense
    (3,309 )     (3,246 )     (3,112 )     (6,555 )     (6,334 )
Gain on sale of investment securities
    26,349       (36 )     7,072       26,313       11,976  
Income from asset sales
    10,816       971       755       11,787       1,636  
Other
    (2 )     348       109       346       118  
 
                             
Total other income (expense)
    34,815       (770 )     5,340       34,045       8,557  
 
                             
Income before income taxes and equity in income (loss) of affiliates
  $ 65,734     $ 36,816     $ 10,223     $ 102,550     $ 22,562  
 
                             

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