Press Release Details
Mitcham Industries Reports Strong Fiscal 2011 Fourth Quarter and Year-End Results
Total revenues for the fourth quarter of fiscal 2011 increased 14% to
"Our fourth quarter performance continued to reflect across the board strength in several of our international markets, particularly
"Looking at our current fiscal year, we are excited about what we have seen so far in fiscal 2012 as there are ongoing indications of increasing demand for seismic services, especially in international markets. We expect essentially all of our lease pool equipment in
FOURTH QUARTER FISCAL 2011 RESULTS
Total revenues for the fiscal 2011 fourth quarter were
Equipment leasing revenues, excluding equipment sales, were
Seamap sales were
Lease pool depreciation in the fourth quarter was
Gross profit in the fiscal 2011 fourth quarter increased 87% to
General and administrative ("G&A") expenses for the fourth quarter of fiscal 2011 were
FISCAL 2011 RESULTS
Total revenues in fiscal 2011 increased 29% to
Gross profit for fiscal 2011 increased to
Operating income in fiscal 2011 was
CONFERENCE CALL
The Company has scheduled a conference call for
This press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included herein, including statements regarding the Company's future financial position and results of operations, the Company's business strategy and other plans for future expansion, the future mix of revenues and business, future demand for the Company's services and general conditions in the energy industry in general and seismic service industry, are forward-looking statements. While management believes that these forward-looking statements are reasonable when and as made, actual results may differ materially from such forward-looking statements. Important factors that could cause or contribute to such differences include
possible decline in demand for seismic data and our services; the effect of fluctuations in oil and natural gas prices on exploration activity; the effect of uncertainty in financial markets on our customers' and our ability to obtain financing; loss of significant customers; seasonal fluctuations that can adversely affect our business; defaults by customers on amounts due us; possible impairment of long-lived assets; risks associated with our manufacturing operations; inability to obtain funding or to obtain funding under acceptable terms; intellectual property claims by third parties; risks associated with our foreign operation, including foreign currency exchange risk; and other factors that are disclosed in the Company's filings with the
- Tables to follow - | ||||
MITCHAM INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (unaudited) | ||||
January 31, | ||||
2011 | 2010 | |||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 14,647 | $ 6,130 | ||
Restricted cash | - | 605 | ||
Accounts receivable, net of allowance for doubtful accounts of $2,666 and $2,420 at January 31, 2011 and 2010, respectively | 17,832 | 15,444 | ||
Current portion of contracts receivable | 3,582 | 2,073 | ||
Inventories, net | 4,813 | 5,199 | ||
Cost and estimated profit in excess of billings on uncompleted contract | - | 398 | ||
Income taxes receivable | 325 | 1,438 | ||
Deferred tax asset | 1,427 | 1,400 | ||
Prepaid expenses and other current assets | 2,128 | 1,986 | ||
Total current assets | 44,754 | 34,673 | ||
Seismic equipment lease pool and property and equipment, net | 79,095 | 66,482 | ||
Intangible assets, net | 5,358 | 2,678 | ||
Goodwill | 4,320 | 4,320 | ||
Prepaid foreign income tax | 3,053 | 2,574 | ||
Deferred tax asset | - | 88 | ||
Long-term portion of contracts receivable, net of valuation allowance of $1,487 at January 31, 2010 | 1,355 | 4,533 | ||
Other assets | 36 | 49 | ||
Total assets | $137,971 | $115,397 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ 5,203 | $ 6,489 | ||
Current maturities — long-term debt | 3,177 | 93 | ||
Foreign income taxes payable | 1,276 | 1,345 | ||
Deferred revenue | 778 | 854 | ||
Accrued expenses and other current liabilities | 5,165 | 2,668 | ||
Total current liabilities | 15,599 | 11,449 | ||
Non-current income taxes payable | 3,482 | 3,258 | ||
Deferred tax liability | 832 | - | ||
Long-term debt | 23,343 | 15,735 | ||
Total liabilities | 43,256 | 30,442 | ||
Commitments and contingencies | ||||
Shareholders' equity: | ||||
Preferred stock, $1.00 par value; 1,000 shares authorized; none issued and outstanding | - | - | ||
Common stock $.01 par value; 20,000 shares authorized; 10,872 and 10,737 shares issued at January 31, 2011 and January 31, 2010, respectively | 109 | 107 | ||
Additional paid-in capital | 77,419 | 75,746 | ||
Treasury stock, at cost (925 and 925 shares at January 31, 2011 and 2010, respectively) | (4,843) | (4,843) | ||
Retained earnings | 14,976 | 10,247 | ||
Accumulated other comprehensive income (loss) | 7,054 | 3,698 | ||
Total shareholders' equity | 94,715 | 84,955 | ||
Total liabilities and shareholders' equity | $ 137,971 | $ 115,397 | ||
MITCHAM INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) | ||||||||
For the Three Months Ended January 31, | For the Twelve Months Ended January 31, | |||||||
2011 | 2010 | 2011 | 2010 | |||||
Revenues: | ||||||||
Equipment leasing | $ 12,692 | $ 7,537 | $36,825 | $27,702 | ||||
Lease pool equipment sales | 972 | 2,343 | 2,470 | 3,321 | ||||
Seamap equipment sales | 4,115 | 6,685 | 21,345 | 20,567 | ||||
Other equipment sales | 1,956 | 795 | 10,723 | 3,582 | ||||
Total revenues | 19,735 | 17,360 | 71,363 | 55,172 | ||||
Cost of sales: | ||||||||
Direct costs - equipment leasing | 1,254 | 1,559 | 3,739 | 3,760 | ||||
Direct costs - lease pool depreciation | 5,799 | 4,585 | 21,354 | 17,712 | ||||
Cost of lease pool equipment sales | 496 | 1,996 | 1,130 | 2,566 | ||||
Cost of Seamap and other equipment sales | 3,121 | 4,364 | 18,498 | 13,009 | ||||
Total cost of sales | 10,670 | 12,504 | 44,721 | 37,047 | ||||
Gross profit | 9,065 | 4,856 | 26,642 | 18,125 | ||||
Operating expenses: | ||||||||
General and administrative | 4,469 | 3,696 | 16,755 | 14,977 | ||||
Provision for doubtful accounts | 998 | - | 1,795 | 1,378 | ||||
Depreciation and amortization | 300 | 209 | 1,171 | 899 | ||||
Total operating expenses | 5,767 | 3,905 | 19,721 | 17,254 | ||||
Operating income | 3,298 | 951 | 6,921 | 871 | ||||
Other income (expenses): | ||||||||
Gain from bargain purchase in business combination | - | - | 1,304 | - | ||||
Interest, net | (171) | (112) | (473) | (415) | ||||
Other, net | (340) | (222) | (958) | 183 | ||||
Total other income (expense) | (511) | (334) | (127) | (232) | ||||
Income before income taxes | 2,787 | 617 | 6,794 | 639 | ||||
Provision for income taxes | (1,033) | (33) | (2,065) | (119) | ||||
Net income | $ 1,754 | $ 584 | $ 4,729 | $ 520 | ||||
Net income per common share: | ||||||||
Basic | $ 0.18 | $ 0.06 | $ 0.48 | $0.05 | ||||
Diluted | $ 0.17 | $ 0.06 | $ 046 | $0.05 | ||||
Shares used in computing net income per common share: | ||||||||
Basic | 9,916 | 9,808 | 9,870 | 9,799 | ||||
Diluted | 10,358 | 10,062 | 10,181 | 9,963 | ||||
MITCHAM INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) | |||||
For the Twelve Months Ended January 31, | |||||
2011 | 2010 | ||||
Cash flows from operating activities: | |||||
Net income | $ 4,729 | $ 520 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 22,717 | 18,740 | |||
Stock-based compensation | 1,099 | 1,401 | |||
Gain from bargain purchase in business combination | (1,304) | - | |||
Provision for doubtful accounts | 1,795 | 1,378 | |||
Provision for inventory obsolescence | 94 | (48) | |||
Gross profit from sale of lease pool equipment | (1,340) | (755) | |||
Excess tax benefit from exercise of non-qualified stock options | 5 | (45) | |||
Deferred tax benefit | 230 | (120) | |||
Changes in non-current income taxes payable | 224 | 270 | |||
Changes in working capital items, net of effects from business combination: | |||||
Trade accounts and contracts receivable | (2,019) | (4,995) | |||
Inventories | 727 | (754) | |||
Prepaid expenses and other current assets | (40) | (470) | |||
Income taxes receivable and payable | 1,001 | 715 | |||
Costs incurred and estimated profit in excess of billings on uncompleted contract | 573 | 1,704 | |||
Prepaid foreign income tax | (318) | (2,620) | |||
Accounts payable, accrued expenses, other current liabilities and deferred revenue | 1,964 | (836) | |||
Net cash provided by operating activities | 30,137 | 14,085 | |||
Cash flows from investing activities: | |||||
Purchases of seismic equipment held for lease | (32,736) | (26,684) | |||
Purchases of property and equipment | (383) | (502) | |||
Sale of used lease pool equipment | 2,470 | 3,321 | |||
Acquisition of AES, net of cash acquired | (2,100) | - | |||
Net cash used in investing activities | (32,749) | (23,865) | |||
Cash flows from financing activities: | |||||
Net proceeds from line of credit | 6,300 | 9,400 | |||
Proceeds from secured promissory note | 3,672 | 414 | |||
Payments on borrowings | (719) | - | |||
Proceeds from short-term investments | 684 | 744 | |||
Proceeds from issuance of common stock upon exercise of stock options, net of stock surrendered to pay taxes | 396 | (17) | |||
Excess tax benefit from exercise of non-qualified stock options | (5) | 45 | |||
Net cash provided by financing activities | 10,328 | 10,586 | |||
Effect of changes in foreign exchange rates on cash and cash equivalents | 801 | 261 | |||
Net change in cash and cash equivalents | 8,517 | 1,067 | |||
Cash and cash equivalents, beginning of period | 6,130 | 5,063 | |||
Cash and cash equivalents, end of period | $ 14,647 | $ 6,130 | |||
Note A MITCHAM INDUSTRIES, INC. Reconciliation of Net Income and Net Cash Provided by Operating Activities to EBITDA (Unaudited) | ||||||||
For the Three Months Ended January 31, | For the Twelve Months Ended January 31, | |||||||
2011 | 2010 | 2011 | 2010 | |||||
(in thousands) | ||||||||
Net income | $ 1,754 | $ 584 | $ 4,729 | $ 520 | ||||
Interest expense, net | 171 | 112 | 473 | 415 | ||||
Depreciation and amortization | 6,131 | 4,828 | 22,717 | 18,740 | ||||
Provision for income taxes | 1,033 | 33 | 2,065 | 119 | ||||
Gain from bargain purchase | - | - | (1,304) | - | ||||
EBITDA (1) | 9,089 | 5,557 | 28,680 | 19,794 | ||||
Stock-based compensation | 158 | 282 | 1,099 | 1,401 | ||||
Adjusted EBITDA (1) | $ 9,247 | $ 5,839 | $ 29,779 | $ 21,195 | ||||
Net cash provided by operating activities | $9,842 | $498 | $30,137 | $14,085 | ||||
Stock-based compensation | (158) | (282) | (1,099) | (1,401) | ||||
Provision for doubtful accounts | (998) | - | (1,795) | (1,378) | ||||
Changes in trade accounts and contracts receivable | 252 | 2,773 | 2,019 | 4,995 | ||||
Interest paid | 263 | 166 | 728 | 627 | ||||
Taxes paid , net of refunds | 205 | 2,389 | 508 | 1,269 | ||||
Gross profit from sale of lease pool equipment | 476 | 347 | 1,340 | 755 | ||||
Changes in contract revenues in excess of billings | - | 42 | (573) | (1,704) | ||||
Changes in inventory | 106 | (714) | (727) | 754 | ||||
Changes in accounts payable, accrued expenses and other current liabilities | 32 | (503) | (1,964) | 836 | ||||
Other | (931) | 841 | 106 | 956 | ||||
EBITDA (1) | $9,089 | $5,557 | $28,680 | $19,794 | ||||
(1) EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation, amortization and impairment. Adjusted EBITDA excludes stock-based compensation. We consider EBITDA and Adjusted EBITDA to be important indicators for the performance of our business, but not measures of performance or liquidity calculated in accordance with accounting principles generally accepted in the United States of America ("GAAP"). We have included these non-GAAP financial measures because management utilizes this information for assessing our performance and liquidity, and as indicators of our ability to make capital expenditures, service debt and finance working capital requirements. The covenants of our revolving credit agreement require us to maintain a minimum level of EBITDA. Management believes that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us. In particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities. We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or as alternatives to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP. In evaluating our performance as measured by EBITDA, management recognizes and considers the limitations of this measurement. EBITDA and Adjusted EBITDA do not reflect our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures. Accordingly, EDITDA and Adjusted EBITDA are only two of the measurements that management utilizes. Other companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies. | ||||||||
Mitcham Industries, Inc. Segment Operating Results (unaudited) | ||||||||
For the Three Months Ended January 31, | For the Twelve Months Ended January 31, | |||||||
2011 | 2010 | 2011 | 2010 | |||||
(in thousands) | ||||||||
Revenues: | ||||||||
Equipment Leasing | $ 15,620 | $ 10,675 | $ 50,018 | $ 34,605 | ||||
Seamap | 5,041 | 6,778 | 22,462 | 20,993 | ||||
Inter-segment sales | (926) | (93) | (1,117) | (426) | ||||
Total revenues | 19,735 | 17,360 | 71,363 | 55,172 | ||||
Cost of sales: | ||||||||
Equipment Leasing | 8,803 | 8,566 | 34,494 | 27,010 | ||||
Seamap | 2,543 | 3,880 | 11,209 | 10,482 | ||||
Inter-segment costs | (676) | 58 | (982) | (445) | ||||
Total cost of sales | 10,670 | 12,504 | 44,721 | 37,047 | ||||
Gross profit | 9,065 | 4,856 | 26,642 | 18,125 | ||||
Operating expenses: | ||||||||
General and administrative | 4,469 | 3,696 | 16,755 | 14,977 | ||||
Provision for doubtful accounts | 998 | - | 1,795 | 1,378 | ||||
Depreciation and amortization | 300 | 209 | 1,171 | 899 | ||||
Total operating expenses | 5,767 | 3,905 | 19,721 | 17,254 | ||||
Operating income | $ 3,298 | $ 951 | $ 6,921 | $ 871 | ||||
Equipment Leasing Segment: | ||||||||
Revenue: | ||||||||
Equipment leasing | $ 12,692 | $ 7,537 | $ 36,825 | $ 27,702 | ||||
Lease pool equipment sales | 972 | 2,343 | 2,470 | 3,321 | ||||
New seismic equipment sales | 605 | 288 | 6,056 | 334 | ||||
SAP equipment sales | 1,351 | 507 | 4,667 | 3,248 | ||||
Total revenue | 15,620 | 10,675 | 50,018 | 34,605 | ||||
Cost of sales: | ||||||||
Lease pool depreciation | 5,838 | 4,446 | 21,512 | 17,712 | ||||
Direct costs-equipment leasing | 1,254 | 1,559 | 3,739 | 3,760 | ||||
Cost of lease pool equipment sales | 496 | 1,996 | 1,130 | 2,566 | ||||
Cost of new seismic equipment sales | 91 | 84 | 4,362 | 146 | ||||
Cost of SAP equipment sales | 1,124 | 481 | 3,751 | 2,826 | ||||
Total cost of sales | 8,803 | 8,566 | 34,494 | 27,010 | ||||
Gross profit | $ 6 ,817 | $ 2,109 | $ 15,524 | $ 7,595 | ||||
Gross profit % | 44% | 20% | 31% | 22% | ||||
Seamap Segment: | ||||||||
Equipment sales | $ 5,041 | $ 6,778 | $ 22,462 | $ 20,993 | ||||
Cost of equipment sales | 2,543 | 3,880 | 11,209 | 10,482 | ||||
Gross profit | $ 2,498 | $ 2,898 | $ 11,253 | $ 10,511 | ||||
Gross profit % | 50% | 43% | 50% | 50% | ||||
Contacts: | Billy F. Mitcham, Jr., President & CEO | |
Mitcham Industries, Inc. | ||
936-291-2277 | ||
Jack Lascar / Karen Roan | ||
Dennard Rupp Gray & Lascar (DRG&L) | ||
713-529-6600 | ||
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