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    Oceaneering Reports Third Quarter 2017 Results

    October 25, 2017

    HOUSTON, Oct. 25, 2017 /PRNewswire/ -- Oceaneering International, Inc. ("Oceaneering") (NYSE: OII) today reported a net loss of $1.8 million, or $(0.02) per share, on revenue of $476 million for the three months ended September 30, 2017.  Excluding the impacts of a total of $4.2 million for: prior year non-income related taxes, discrete income tax expense, and foreign currency exchange losses, adjusted net income was $2.4 million, or $0.02 per share.

    During the immediately preceding quarter, Oceaneering reported net income of $2.1 million, or $0.02 per share, on revenue of $515 million.

    Adjusted operating income, operating margin, net income (loss) and earnings (loss) per share, EBITDA and adjusted EBITDA (as well as EBITDA and adjusted EBITDA margins) and free cash flow are non-GAAP measures which exclude the impacts of certain identified items.  Reconciliations to the corresponding GAAP measures are shown in the tables Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share (EPS), EBITDA and EBITDA Margins, Free Cash Flow, Adjusted Operating Income and Margins by Segment, and EBITDA and Adjusted EBITDA and Margins by Segment.  These tables are included below under the caption Reconciliations of Non-GAAP to GAAP Financial Information.

    Summary of Results

    (in thousands, except per share amounts)




    Three Months Ended


    Nine Months Ended



    Sep 30,


    Jun 30,


    Sep 30,










    2017


    2016


    2017


    2017


    2016












    Revenue


    $

    476,120



    $

    549,275



    $

    515,036



    $

    1,437,332



    $

    1,783,158


    Gross Margin


    54,885



    35,443



    53,571



    153,311



    228,156


    Income (Loss) from Operations


    10,531



    (11,856)



    9,390



    19,771



    74,623


    Net Income (Loss)


    (1,768)



    (11,798)



    2,132



    (7,170)



    35,614













    Diluted Earnings (Loss) Per Share (EPS)


    $

    (0.02)



    $

    (0.12)



    $

    0.02



    $

    (0.07)



    $

    0.36







    Sequentially, adjusted operating income improved 28% due mainly to increased profit contributions from Subsea Projects and Subsea Products, and reduced Unallocated Expenses, offset primarily by lower profits being realized by ROVs.

    Roderick A. Larson, President and Chief Executive Officer of Oceaneering, stated, "Our third quarter adjusted operating results were in line with our expectations, with the exception of ROVs.  Furthermore, each of our operating segments remained profitable and generated substantial EBITDA.  On a consolidated basis, for the first nine months of 2017, we have generated $179 million of adjusted EBITDA and $84 million of free cash flow.  These results are commendable in light of an offshore oilfield services and products market landscape that remains extremely challenging due to continued pricing degradation and the sluggish rate of subsea project approval and progression.  Our tax provision, as adjusted, was higher than the statutory percentage of pre-tax income due to the geographic mix of tax jurisdictions in which we generated our earnings and losses.

    "Compared to the second quarter, third quarter ROV adjusted operating income declined more than expected due to lower average revenue per day on hire and an increase in average daily operating costs.  Consequently, ROV adjusted EBITDA margin declined to 33%, from 38% for the second quarter.

    "Additionally, average ROV revenue per day on hire decreased 3% due primarily to an unfavorable change in geographic mix, as we experienced disproportionately fewer work days in higher day rate operating areas, notably Angola.  Days on hire increased 4% as our fleet utilization improved to 50% from 48%.  At the end of September 2017, our fleet size remained at 279 vehicles.  Our fleet use mix during the quarter was unchanged from the prior quarter at 61% in drill support and 39% vessel-based activity.  At the end of September, we had ROVs on 83, or 55% of the 151 floating rigs under contract.  This compares to having ROVs on 53% of the rigs contracted at the end of June and the end of March 2017.

    "Compared to the second quarter, Subsea Products third quarter operating income improved as expected on an 18% decline in quarterly revenues.  Operating margin improved due to a higher percentage of segment revenue being generated by our service and rental business unit and excellent execution by our umbilical business unit.  Our Subsea Products backlog at September 30, 2017 was $284 million, compared to our June 30, 2017 backlog of $328 million.  The backlog decline was largely attributable to low umbilical order intake and production associated with Shell Appomattox.  Our book-to-bill ratio year-to-date was 0.69 and the past twelve months has been 0.72, no change from the prior quarter.

    "Sequentially, Subsea Projects revenue and operating income increased, principally driven by seasonal improvements in U.S. Gulf of Mexico deepwater vessel work.  Asset Integrity operating income was down slightly as projected.  Advanced Technologies revenue and operating income declined as expected, primarily due to lower levels of work for the U.S. Navy.  Unallocated Expenses were lower.

    "Looking forward, we believe our fourth quarter results will be considerably lower than our adjusted third quarter results due to seasonality and a reduced level of activity.  Most of the decline is expected to be in our ROV and Subsea Projects segments, with modestly lower operating income from our other oilfield segments as we foresee very few near-term catalysts to support an improvement in our oilfield markets.  For our non-oilfield segment, Advanced Technologies, we are projecting a modest quarterly improvement, and slightly higher Unallocated Expenses.

    "While our fourth quarter outlook has been revised downward, we continue to believe that we will be marginally profitable at the operating income line on a consolidated basis for all of 2017.

    "Based on the current number of floating rigs working and expectations for further reductions in oil and gas industry capital and operating expenditures as offshore activities get pushed into 2019, we believe our 2018 earnings will be significantly lower than 2017.  However, during 2018, we expect each of our operating segments will contribute positive EBITDA, and, on a consolidated basis, we will generate sufficient cash flows to service our debt and fund our anticipated maintenance and organic growth capital expenditures.  While we are anticipating an increase in offshore activity levels during the second half of 2018, we do not expect this shift in momentum to be adequate to offset the near-term market weakness or to present an opportunity to meaningfully improve pricing.

    "Beyond 2018, we believe that the oil and gas industry will continue its investment in deepwater projects, and foresee improving demand for our services and products.  Meanwhile, we continue to look for opportunities that may emerge to grow our company, with more focus on our customers' operating expenditures in the production phase of the offshore oilfield life cycle."

    This release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected business, financial performance and prospects of Oceaneering. More specifically, the forward-looking statements in this press release include the statements concerning Oceaneering's: outlook for the fourth quarter of 2017, and expected contributions of its segments to the fourth quarter results, as well as expected fourth quarter Unallocated Expenses; expectation for the full year of 2017 to be marginally profitable at the operating income line on a consolidated basis; outlook for 2018 earnings relative to 2017, and expected contribution of its segments to the 2018 results; beliefs about deepwater investment and improving demand for its services and products; and intention to look for opportunities that may emerge to grow the company, with more focus on its customers' operating expenditures in the production phase of the offshore oilfield life cycle. The forward-looking statements included in this release are based on our current expectations and are subject to certain risks, assumptions, trends and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. Among the factors that could cause actual results to differ materially include: factors affecting the level of activity in the oil and gas industry; supply and demand of drilling rigs; oil and natural gas demand and production growth; oil and natural gas prices; fluctuations in currency markets worldwide; future global economic conditions; the loss of major contracts or alliances; future performance under our customer contracts; and the effects of competition. For a more complete discussion of these and other risk factors, please see Oceaneering's latest annual report on Form 10-K and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission.

    Oceaneering is a global provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater applications.  Through the use of its applied technology expertise, Oceaneering also serves the defense, entertainment, and aerospace industries.

    For more information on Oceaneering, please visit www.oceaneering.com.

    Contact:
    Suzanne Spera
    Director, Investor Relations
    Oceaneering International, Inc.
    713-329-4707
    investorrelations@oceaneering.com



















    OCEANEERING INTERNATIONAL, INC. AND SUBSIDIARIES



















    CONDENSED CONSOLIDATED BALANCE SHEETS


































    Sep 30, 2017


    Dec 31, 2016














    (in thousands)

    ASSETS

















    Current Assets (including cash and cash equivalents of $472,381 and $450,193)


    $

    1,232,775



    $

    1,262,595



    Net Property and Equipment







    1,083,353



    1,153,258



    Other Assets










    828,555



    714,462





    TOTAL ASSETS






    $

    3,144,683



    $

    3,130,315




















    LIABILITIES AND SHAREHOLDERS' EQUITY






    Current Liabilities










    $

    461,456



    $

    508,364



    Long-term Debt










    795,805



    793,058



    Other Long-term Liabilities






    387,464



    312,250



    Shareholders' Equity










    1,499,958



    1,516,643





    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY


    $

    3,144,683



    $

    3,130,315




















    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS




























    For the Three Months Ended


    For the Nine Months Ended










    Sep 30, 2017


    Sep 30, 2016


    Jun 30, 2017


    Sep 30, 2017


    Sep 30, 2016










    (in thousands, except per share amounts)




















    Revenue






    $

    476,120



    $

    549,275



    $

    515,036



    $

    1,437,332



    $

    1,783,158



    Cost of services and products


    421,235



    513,832



    461,465



    1,284,021



    1,555,002




    Gross Margin


    54,885



    35,443



    53,571



    153,311



    228,156



    Selling, general and administrative expense


    44,354



    47,299



    44,181



    133,540



    153,533




    Income (loss) from Operations




    10,531



    (11,856)



    9,390



    19,771



    74,623



    Interest income






    1,997



    684



    2,045



    5,379



    2,421



    Interest expense






    (8,650)



    (6,325)



    (7,599)



    (22,517)



    (18,924)



    Equity earnings (losses) of unconsolidated affiliates


    (424)



    (246)



    (394)



    (1,798)



    543



    Other income (expense), net


    (1,287)



    570



    (58)



    (3,901)



    (6,823)




    Income before Income Taxes


    2,167



    (17,173)



    3,384



    (3,066)



    51,840



    Provision for income taxes (benefit)


    3,935



    (5,375)



    1,252



    4,104



    16,226




    Net Income (loss)


    $

    (1,768)



    $

    (11,798)



    $

    2,132



    $

    (7,170)



    $

    35,614




















    Weighted average diluted shares outstanding


    98,270



    98,061



    98,751



    98,224



    98,384


    Diluted Earnings (Loss) per Share


    $

    (0.02)



    $

    (0.12)



    $

    0.02



    $

    (0.07)



    $

    0.36




















    The above Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations should be read in conjunction with the Company's latest Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

     

    SEGMENT INFORMATION








    For the Three Months Ended


    For the Nine Months Ended







    Sep 30, 2017


    Sep 30, 2016


    Jun 30, 2017


    Sep 30, 2017


    Sep 30, 2016







    ($ in thousands)












    Remotely Operated Vehicles


    Revenue



    $

    104,617



    $

    126,507



    $

    103,432



    $

    302,071



    $

    413,769



    Gross Margin



    $

    12,102



    $

    (16,288)



    $

    16,659



    $

    41,783



    $

    45,959


    Operating Income (Loss)



    $

    5,009



    $

    (23,845)



    $

    10,376



    $

    21,310



    $

    21,162


    Operating Income (Loss)%



    5

    %


    (19)%



    10

    %


    7

    %


    5

    %


    Days available



    25,695



    29,126



    25,300



    76,214



    86,904



    Days utilized



    12,742



    15,156



    12,267



    36,497



    47,218



    Utilization



    50

    %


    52

    %


    48

    %


    48

    %


    54

    %
















    Subsea Products


    Revenue



    $

    143,583



    $

    157,269



    $

    174,893



    $

    469,115



    $

    542,978



    Gross Margin



    $

    24,949



    $

    20,423



    $

    22,762



    $

    72,702



    $

    119,287


    Operating Income



    $

    12,383



    $

    6,109



    $

    10,552



    $

    34,418



    $

    71,870


    Operating Income %



    9

    %


    4

    %


    6

    %


    7

    %


    13

    %

    Backlog at end of period



    $

    284,000



    $

    457,000



    $

    328,000



    $

    284,000



    $

    457,000

















    Subsea Projects


    Revenue



    $

    80,116



    $

    110,799



    $

    75,545



    $

    218,617



    $

    378,883



    Gross Margin



    $

    10,187



    $

    19,321



    $

    6,462



    $

    20,673



    $

    45,147


    Operating Income



    $

    6,512



    $

    15,029



    $

    3,000



    $

    9,699



    $

    32,055


    Operating Income %



    8

    %


    14

    %


    4

    %


    4

    %


    8

    %
















    Asset Integrity



    Revenue



    $

    61,098



    $

    71,995



    $

    58,192



    $

    171,948



    $

    215,459



    Gross Margin



    $

    9,754



    $

    11,591



    $

    10,004



    $

    28,139



    $

    29,030


    Operating Income



    $

    3,050



    $

    4,725



    $

    3,755



    $

    9,072



    $

    4,354


    Operating Income %



    5

    %


    7

    %


    6

    %


    5

    %


    2

    %
















    Advanced Technologies


    Revenue



    $

    86,706



    $

    82,705



    $

    102,974



    $

    275,581



    $

    232,069



    Gross Margin



    $

    11,833



    $

    9,665



    $

    14,133



    $

    36,038



    $

    26,092


    Operating Income



    $

    6,602



    $

    4,357



    $

    7,632



    $

    19,260



    $

    10,478


    Operating Income %



    8

    %


    5

    %


    7

    %


    7

    %


    5

    %
















    Unallocated
    Expenses












    Gross Margin



    $

    (13,940)



    $

    (9,269)



    $

    (16,449)



    $

    (46,024)



    $

    (37,359)


    Operating Income



    $

    (23,025)



    $

    (18,231)



    $

    (25,925)



    $

    (73,988)



    $

    (65,296)















    TOTAL



    Revenue



    $

    476,120



    $

    549,275



    $

    515,036



    $

    1,437,332



    $

    1,783,158



    Gross Margin



    $

    54,885



    $

    35,443



    $

    53,571



    $

    153,311



    $

    228,156


    Operating Income (Loss)



    $

    10,531



    $

    (11,856)



    $

    9,390



    $

    19,771



    $

    74,623


    Operating Income (Loss) %



    2

    %


    (2)

    %


    2

    %


    1

    %


    4

    %
















     


    SELECTED CASH FLOW INFORMATION



























    For the Three Months Ended


    For the Nine Months Ended







    Sep 30, 2017


    Sep 30, 2016


    Jun 30, 2017


    Sep 30, 2017


    Sep 30, 2016







    (in thousands)













    Capital expenditures, including acquisitions



    $

    29,878



    $

    32,945



    $

    23,493



    $

    71,178



    $

    85,889














    Depreciation and Amortization:












    Oilfield














    Remotely Operated Vehicles



    $

    28,269



    $

    43,705



    $

    29,036



    $

    86,534



    $

    111,415



    Subsea Products



    13,340



    14,205



    12,785



    39,124



    39,964



    Subsea Projects



    7,881



    8,575



    7,781



    23,742



    25,447



    Asset Integrity



    2,139



    5,980



    1,780



    5,379



    11,736


    Total Oilfield




    51,629



    72,465



    51,382



    154,779



    188,562


    Advanced Technologies



    796



    789



    784



    2,377



    2,329


    Unallocated Expenses



    1,088



    946



    1,138



    3,324



    3,069



    Total depreciation and amortization



    $

    53,513



    $

    74,200



    $

    53,304



    $

    160,480



    $

    193,960

















    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION

    In addition to financial results determined in accordance with U.S. generally accepted accounting principles ("GAAP"), this Press Release also includes non-GAAP financial measures (as defined under SEC Regulation G).  We have included Adjusted Net Income and Diluted Earnings per Share, each of which excludes the effects of certain specified items, as set forth in the tables that follow.  As a result, these amounts are non-GAAP financial measures.  We believe these are useful measures for investors to review because they provide consistent measures of the underlying results of our ongoing business.  Furthermore, our management uses these measures as measures of the performance of our operations.  We have also included disclosures of Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), EBITDA Margins and Free Cash Flow, as well as the following by segment:  Adjusted Operating Income and Margins, EBITDA, Adjusted EBITDA and Adjusted EBITDA Margins.  We define EBITDA margin as EBITDA divided by revenue.  Adjusted EBITDA and Adjusted EBITDA Margins as well as Adjusted Operating Income and Margin and related information by segment exclude the effects of certain specified items, as set forth in the tables that follow.  EBITDA and EBITDA margins, Adjusted EBITDA and Adjusted EBITDA margins, and Adjusted Operating Income and Margin and related information by segment are each non-GAAP financial measures.  We define Free Cash Flow as cash flow provided by operating activities less organic capital expenditures (i.e., purchases of property and equipment other than those in business acquisitions).  We have included these disclosures in this press release because EBITDA,  EBITDA margins and Free Cash Flow are widely used by investors for valuation and comparing our financial performance with the performance of other companies in our industry, and the adjusted amounts thereof (as well as Adjusted Operating Income and Margin by Segment) provide more consistent measures than the unadjusted amounts.  Furthermore, our management uses these measures for purposes of evaluating our financial performance.  Our presentation of EBITDA, EBITDA margins and Free Cash Flow (and the Adjusted amounts thereof) may not be comparable to similarly titled measures other companies report.  Non-GAAP financial measures should be viewed in addition to and not as substitutes for our reported operating results, cash flows or any other measure prepared and reported in accordance with GAAP.   The tables that follow provide reconciliations of the non-GAAP measures used in this press release to the most directly comparable GAAP measures.

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION

















    Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share (EPS)






















    For the Three Months Ended






    Sep 30, 2017

    Sep 30, 2016

    Jun 30, 2017






    Net Income


    Diluted EPS


    Net Income


    Diluted EPS


    Net Income


    Diluted EPS






    (in thousands, except per share amounts)








    Net Income (Loss) and Diluted EPS as reported in accordance with GAAP


    $

    (1,768)



    $

    (0.02)



    $

    (11,798)



    $

    (0.12)



    $

    2,132



    $

    0.02


    Pre tax adjustments for the effects of:














    Inventory write-downs






    30,490









    Fixed asset write-offs






    13,790









    Charge related to prior year non-income related taxes


    1,500













    Foreign currency (gains) losses


    1,273





    (643)





    (20)




    Total pre tax adjustments


    2,773





    43,637





    (20)




















    Tax effect on pre tax adjustments at the 35% statutory rate




    (971)





    (15,273)





    7

















    Discrete tax items


    2,413


























    Total of adjustments


    4,215





    28,364





    (13)





    Adjusted net income


    $

    2,447



    $

    0.02



    $

    16,566



    $

    0.17



    $

    2,119



    $

    0.02




















    For Nine Months Ended



    Sep 30, 2017

    Sep 30, 2016



    Net Income


    Diluted EPS


    Net Income


    Diluted EPS



    (in thousands, except per share amounts)








    Net Income (Loss) and Diluted EPS as reported in accordance with GAAP






    $

    (7,170)



    $

    (0.07)



    $

    35,614



    $

    0.36


    Pre tax adjustments for the effects of:










    Inventory write-downs






    30,490





    Allowance for bad debts






    5,569





    Fixed asset write-offs






    13,790





    Charge related to prior year non-income related taxes


    1,500









    Foreign currency losses


    3,406





    6,459




    Total pre tax adjustments






    4,906





    56,308




















    Tax effect on pre tax adjustments at the 35% statutory rate


    (1,718)





    (19,708)




















    Discrete tax items


    4,519





















    Total of adjustments






    7,707





    36,600







    Adjusted net income


    $

    537



    $

    0.01



    $

    72,214



    $

    0.73
















    Notes:










    The $2.4 million discrete tax provision during the three months ended September 30, 2017 included a $1.4 million tax reserve for uncertain income tax positions related to foreign entity tax filings of prior years.  The $4.7 million discrete tax provision for the nine months ended September 30, 2017 included the $2.9 million provision made during the three months ended March 31, 2017 related to tax amounts associated with share based compensation required to be implemented effective January 1, 2017.


















    Weighted average number of diluted shares in each period presented is the same for each adjusting item as used in accordance with GAAP for that period, except for the three-month and nine-month periods ended September 30, 2017, and the three-month ended September 30, 2016, where we used 98,796,533, 98,734,516 and 98,443,914 respectively, instead of 98,270,168, 98,224,129 and 98,061,214 respectively, share amounts used in reporting EPS in accordance with GAAP, as our share equivalents became dilutive based on the amount of adjusted net income.









     

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION

















    EBITDA and EBITDA Margins
























    For the Three Months Ended


    For the Nine Months Ended








    Sep 30, 2017


    Sep 30, 2016


    Jun 30, 2017


    Sep 30, 2017


    Sep 30, 2016








    ($ in thousands)

















    Net Income (Loss)




    $

    (1,768)



    $

    (11,798)



    $

    2,132



    $

    (7,170)



    $

    35,614


    Depreciation and Amortization




    53,513



    74,200



    53,304



    160,480



    193,960



    Subtotal




    51,745



    62,402



    55,436



    153,310



    229,574


    Interest Expense, net of Interest Income




    6,653



    5,641



    5,554



    17,138



    16,503


    Amortization included in Interest Expense




    (283)



    (287)



    (283)



    (849)



    (860)


    Provision for Income Taxes (Benefit)




    3,935



    (5,375)



    1,252



    4,104



    16,226



    EBITDA




    $

    62,050



    $

    62,381



    $

    61,959



    $

    173,703



    $

    261,443


















    Revenue




    $

    476,120



    $

    549,275



    $

    515,036



    $

    1,437,332



    $

    1,783,158


















    EBITDA margin %




    13

    %


    11

    %


    12

    %


    12

    %


    15

    %

















     














    Free Cash Flow






















    For the Nine Months Ended











    Sep 30, 2017


    Sep 30, 2016









    (in thousands)


    Net Income







    $

    (7,170)



    $

    35,614



    Depreciation and amortization







    160,480



    193,960



    Other increases (decreases) in cash from operating activities







    (9,296)



    32,099



    Cash flow provided by operating activities







    144,014



    261,673



    Purchases of property and equipment







    (59,900)



    (83,389)



    Free Cash Flow







    $

    84,114



    $

    178,284



     

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION




    Adjusted Operating Income and Margins by Segment






    For the Three Months Ended September 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    5,009



    $

    12,383



    $

    6,512



    $

    3,050



    $

    6,602



    $

    (23,025)



    $

    10,531


    Adjustments for the effects of:















    Charge related to prior year non-income related taxes


    1,275



    225











    1,500




    Total of adjustments


    1,275



    225











    1,500



















    Adjusted operating income


    $

    6,284



    $

    12,608



    $

    6,512



    $

    3,050



    $

    6,602



    $

    (23,025)



    $

    12,031



















    Revenue


    $

    104,617



    $

    143,583



    $

    80,116



    $

    61,098



    $

    86,706





    $

    476,120


    Operating income % as reported in accordance with GAAP


    5

    %


    9

    %


    8

    %


    5

    %


    8

    %




    2

    %

    Operating income % using adjusted amounts


    6

    %


    9

    %


    8

    %


    5

    %


    8

    %




    3

    %







































    For the Three Months Ended September 30, 2016





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses


    Total





    ($ in thousands)

    Operating income (loss) as reported in accordance with GAAP


    $

    (23,845)



    $

    6,109



    $

    15,029



    $

    4,725



    $

    4,357



    $

    (18,231)



    $

    (11,856)


    Adjustments for the effects of:















    Inventory write-downs


    25,200



    5,290











    30,490



    Fixed asset write-offs


    10,840



    2,950











    13,790




    Total of adjustments


    36,040



    8,240











    44,280


    Adjusted operating income


    $

    12,195



    $

    14,349



    $

    15,029



    $

    4,725



    $

    4,357



    $

    (18,231)



    $

    32,424



















    Revenue


    $

    126,507



    $

    157,269



    $

    110,799



    $

    71,995



    $

    82,705





    $

    549,275


    Operating income (loss) % as reported in accordance with GAAP


    (19)

    %


    4

    %


    14

    %


    7

    %


    5

    %




    (2)

    %

    Operating income % using adjusted amounts


    10

    %


    9

    %


    14

    %


    7

    %


    5

    %




    6

    %


     





    For the Three Months Ended June 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    10,376



    $

    10,552



    $

    3,000



    $

    3,755



    $

    7,632



    $

    (25,925)



    $

    9,390


    Adjusted operating income


    $

    10,376



    $

    10,552



    $

    3,000



    $

    3,755



    $

    7,632



    $

    (25,925)



    $

    9,390




































    Revenue


    $

    103,432



    $

    174,893



    $

    75,545



    $

    58,192



    $

    102,974





    $

    515,036


    Operating income % as reported in accordance with GAAP


    10

    %


    6

    %


    4

    %


    6

    %


    7

    %




    2

    %

    Operating income % using adjusted amounts


    10

    %


    6

    %


    4

    %


    6

    %


    7

    %




    2

    %


     

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION




    Adjusted Operating Income and Margins by Segment






    For the Nine Months Ended September 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    21,310



    $

    34,418



    $

    9,699



    $

    9,072



    $

    19,260



    $

    (73,988)



    $

    19,771


    Adjustments for the effects of:















    Charge related to prior year non-income related taxes


    1,275



    225











    1,500




    Total of adjustments


    1,275



    225











    1,500


    Adjusted operating income


    $

    22,585



    $

    34,643



    $

    9,699



    $

    9,072



    $

    19,260



    $

    (73,988)



    $

    21,271



















    Revenue


    $

    302,071



    $

    469,115



    $

    218,617



    $

    171,948



    $

    275,581





    $

    1,437,332


    Operating income % as reported in accordance with GAAP


    7

    %


    7

    %


    4

    %


    5

    %


    7

    %




    1

    %

    Operating income % using adjusted amounts


    7

    %


    7

    %


    4

    %


    5

    %


    7

    %




    1

    %






















    For the Nine Months Ended September 30, 2016





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc. Expenses


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    21,162



    $

    71,870



    $

    32,055



    $

    4,354



    $

    10,478



    $

    (65,296)



    $

    74,623


    Adjustments for the effects of:















    Inventory write-downs


    25,200



    5,290











    30,490



    Allowance for bad debts


    340



    1,770



    127



    3,332







    5,569



    Fixed asset write-offs


    10,840



    2,950











    13,790




    Total of adjustments


    36,380



    10,010



    127



    3,332







    49,849


    Adjusted operating income


    $

    57,542



    $

    81,880



    $

    32,182



    $

    7,686



    $

    10,478



    $

    (65,296)



    $

    124,472



















    Revenue


    $

    413,769



    $

    542,978



    $

    378,883



    $

    215,459



    $

    232,069





    $

    1,783,158


    Operating income % as reported in accordance with GAAP


    5

    %


    13

    %


    8

    %


    2

    %


    5

    %




    4

    %

    Operating income % using adjusted amounts


    14

    %


    15

    %


    8

    %


    4

    %


    5

    %




    7

    %


     

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION




    EBITDA and Adjusted EBITDA and Margins by Segment






    For the Three Months Ended September 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses
    and other


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    5,009



    $

    12,383



    $

    6,512



    $

    3,050



    $

    6,602



    $

    (23,025)



    $

    10,531


    Adjustments for the effects of:















    Depreciation and amortization


    28,269



    13,340



    7,881



    2,139



    796



    1,088



    53,513



    Other pre-tax












    (1,994)



    (1,994)



    EBITDA


    33,278



    25,723



    14,393



    5,189



    7,398



    (23,931)



    62,050


    Adjustments for the effects of:















    Charge related to prior year non-income related taxes


    1,275



    225











    1,500



    Foreign currency (gains) losses












    1,273



    1,273




    Total of adjustments


    1,275



    225









    1,273



    2,773


    Adjusted EBITDA


    $

    34,553



    $

    25,948



    $

    14,393



    $

    5,189



    $

    7,398



    $

    (22,658)



    $

    64,823



















    Revenue


    $

    104,617



    $

    143,583



    $

    80,116



    $

    61,098



    $

    86,706





    $

    476,120


    Operating income % as reported in accordance with GAAP


    5

    %


    9

    %


    8

    %


    5

    %


    8

    %




    2

    %

    EBITDA Margin


    32

    %


    18

    %


    18

    %


    8

    %


    9

    %




    13

    %

    Adjusted EBITDA Margin


    33

    %


    18

    %


    18

    %


    8

    %


    9

    %




    14

    %






















    For the Three Months Ended September 30, 2016





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses
    and other


    Total





    ($ in thousands)

    Operating income (loss) as reported in accordance with GAAP


    $

    (23,845)



    $

    6,109



    $

    15,029



    $

    4,725



    $

    4,357



    $

    (18,231)



    $

    (11,856)


    Adjustments for the effects of:















    Depreciation and amortization


    43,705



    14,205



    8,575



    5,980



    789



    946



    74,200



    Other pre-tax












    37



    37



    EBITDA


    19,860



    20,314



    23,604



    10,705



    5,146



    (17,248)



    62,381


    Adjustments for the effects of:















    Inventory write-downs


    25,200



    5,290











    30,490




    Total of adjustments


    25,200



    5,290











    30,490


    Adjusted EBITDA


    $

    45,060



    $

    25,604



    $

    23,604



    $

    10,705



    $

    5,146



    $

    (17,248)



    $

    92,871



















    Revenue


    $

    126,507



    $

    157,269



    $

    110,799



    $

    71,995



    $

    82,705





    $

    549,275


    Operating income (loss) % as reported in accordance with GAAP


    (19)

    %


    4

    %


    14

    %


    7

    %


    5

    %




    (2)

    %

    EBITDA Margin


    16

    %


    13

    %


    21

    %


    15

    %


    6

    %




    11

    %

    Adjusted EBITDA Margin


    36

    %


    16

    %


    21

    %


    15

    %


    6

    %




    17

    %

     





    For the Three Months Ended June 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses and other


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    10,376



    $

    10,552



    $

    3,000



    $

    3,755



    $

    7,632



    $

    (25,925)



    $

    9,390


    Adjustments for the effects of:















    Depreciation and amortization


    29,036



    12,785



    7,781



    1,780



    784



    1,138



    53,304



    Other pre-tax












    (735)



    (735)



    EBITDA


    39,412



    23,337



    10,781



    5,535



    8,416



    (25,522)



    61,959


    Adjustments for the effects of:















    Foreign currency (gains) losses












    (20)



    (20)


    Adjusted EBITDA


    $

    39,412



    $

    23,337



    $

    10,781



    $

    5,535



    $

    8,416



    $

    (25,542)



    $

    61,939



















    Revenue


    $

    103,432



    $

    174,893



    $

    75,545



    $

    58,192



    $

    102,974





    $

    515,036


    Operating income % as reported in accordance with GAAP


    10

    %


    6

    %


    4

    %


    6

    %


    7

    %




    2

    %

    EBITDA Margin


    38

    %


    13

    %


    14

    %


    10

    %


    8

    %




    12

    %

    Adjusted EBITDA Margin


    38

    %


    13

    %


    14

    %


    10

    %


    8

    %




    12

    %


















     

    RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION




    EBITDA and Adjusted EBITDA and Margins by Segment






    For the Nine Months Ended September 30, 2017





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced

    Tech.


    Unalloc.
    Expenses
    and other


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    21,310



    $

    34,418



    $

    9,699



    $

    9,072



    $

    19,260



    $

    (73,988)



    $

    19,771


    Adjustments for the effects of:















    Depreciation and amortization


    86,534



    39,124



    23,742



    5,379



    2,377



    3,324



    160,480



    Other pre-tax












    (6,548)



    (6,548)



    EBITDA


    107,844



    73,542



    33,441



    14,451



    21,637



    (77,212)



    173,703


    Adjustments for the effects of:















    Charge related to prior year non-income related taxes


    1,275



    225











    1,500



    Foreign currency (gains) losses












    3,406



    3,406




    Total of adjustments


    1,275



    225









    3,406



    4,906


    Adjusted EBITDA


    $

    109,119



    $

    73,767



    $

    33,441



    $

    14,451



    $

    21,637



    $

    (73,806)



    $

    178,609



















    Revenue


    $

    302,071



    $

    469,115



    $

    218,617



    $

    171,948



    $

    275,581





    $

    1,437,332


    Operating income % as reported in accordance with GAAP


    7

    %


    7

    %


    4

    %


    5

    %


    7

    %




    1

    %

    EBITDA Margin


    36

    %


    16

    %


    15

    %


    8

    %


    8

    %




    12

    %

    Adjusted EBITDA Margin


    36

    %


    16

    %


    15

    %


    8

    %


    8

    %




    12

    %






















    For the Nine Months Ended September 30, 2016





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unalloc.
    Expenses
    and other


    Total





    ($ in thousands)

    Operating income as reported in accordance with GAAP


    $

    21,162



    $

    71,870



    $

    32,055



    $

    4,354



    $

    10,478



    $

    (65,296)



    $

    74,623


    Adjustments for the effects of:















    Depreciation and amortization


    111,415



    39,964



    25,447



    11,736



    2,329



    3,069



    193,960



    Other pre-tax












    (7,140)



    (7,140)



    EBITDA


    132,577



    111,834



    57,502



    16,090



    12,807



    (69,367)



    261,443


    Adjustments for the effects of:















    Inventory write-downs


    25,200



    5,290











    30,490



    Allowance for bad debts


    340



    1,770



    127



    3,332







    5,569




    Total of adjustments


    25,540



    7,060



    127



    3,332







    36,059


    Adjusted EBITDA


    $

    158,117



    $

    118,894



    $

    57,629



    $

    19,422



    $

    12,807



    $

    (69,367)



    $

    297,502



















    Revenue


    $

    413,769



    $

    542,978



    $

    378,883



    $

    215,459



    $

    232,069





    $

    1,783,158


    Operating income % as reported in accordance with GAAP


    5

    %


    13

    %


    8

    %


    2

    %


    5

    %




    4

    %

    EBITDA Margin


    32

    %


    21

    %


    15

    %


    7

    %


    6

    %




    15

    %

    Adjusted EBITDA Margin


    38

    %


    22

    %


    15

    %


    9

    %


    6

    %




    17

    %


















     

    View original content:http://www.prnewswire.com/news-releases/oceaneering-reports-third-quarter-2017-results-300543499.html

    SOURCE Oceaneering International, Inc.

    Categories: Press Releases
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