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    Oceaneering Reports Second Quarter 2020 Results

    July 29, 2020

    HOUSTON, July 29, 2020 /PRNewswire/ -- Oceaneering International, Inc. ("Oceaneering") (NYSE:OII) today reported a net loss of $24.8 million, or $(0.25) per share, on revenue of $427 million for the three months ended June 30, 2020.  Adjusted net loss was $14.2 million, or $(0.14) per share, reflecting the impact of $9.6 million of pre-tax adjustments associated with restructuring expenses and foreign exchange losses recognized during the quarter and $3.3 million of other discrete tax adjustments.

    During the prior quarter ended March 31, 2020, Oceaneering reported a net loss of $368 million, or $(3.71) per share, on revenue of $537 million.  Adjusted net income was $3.5 million, or $0.04 per share, reflecting the impact of $393 million of pre-tax adjustments, primarily $379 million associated with goodwill impairments, asset impairments and write-offs recognized during the quarter.

    Adjusted operating income (loss), operating margins, 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 that 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 (Loss) 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


    Six Months Ended



    Jun 30,


    Mar 31,


    Jun 30,










    2020


    2019


    2020


    2020


    2019












    Revenue


    $

    427,216



    $

    495,781



    $

    536,668



    $

    963,884



    $

    989,667


    Gross Margin


    42,537



    41,983



    46,752



    89,289



    69,570


    Income (Loss) from Operations


    (5,182)



    (9,635)



    (380,757)



    (385,939)



    (31,349)


    Net Income (Loss)


    (24,788)



    (35,182)



    (367,598)



    (392,386)



    (60,009)













    Diluted Earnings (Loss) Per Share


    $

    (0.25)



    $

    (0.36)



    $

    (3.71)



    $

    (3.96)



    $

    (0.61)







    Roderick A. Larson, President and Chief Executive Officer of Oceaneering, stated, "Considering all of the uncertainties surrounding the crude oil markets and the COVID-19 pandemic, we were satisfied with our second quarter 2020 results.  For the second quarter, we generated adjusted EBITDA of $40.5 million, exceeding consensus estimates, and we generated $26.9 million of free cash flow.  These positive results were partially attributable to our actions to substantially reduce structural costs in light of an expected continuation of lower demand for our services and products.  The positive effect of these cost reductions is reflected in our 9% consolidated adjusted EBITDA margin for the second quarter of 2020, which declined by only 14 basis points as compared to the first quarter of 2020, despite a 20% decrease in revenue.

    "As expected, compared to the first quarter of 2020, the aggregate result of our energy segments declined during the second quarter of 2020.  However, this decline was partially offset by improved performance in our non-energy segment, Advanced Technologies, and lower Unallocated Expenses.  We did experience some operational disruptions and delays due to COVID-19 during the second quarter but the safety protocols we, and the industry, put into place in response to the pandemic limited impacts to our employees and customers.

    "Sequentially, ROV adjusted operating performance declined as anticipated, primarily due to the lower number of working drilling rigs.  This led to fewer days on hire for drill support services that were slightly offset by a marginal increase in days on hire for vessel-based services.  Our fleet use during the quarter was 64% in drill support and 36% in vessel-based activity, compared to 68% and 32%, respectively, during the first quarter.  Revenue declined 12%, primarily due to a 9% decrease in ROV days on hire.  ROV adjusted EBITDA margin remained relatively unchanged at 31% during the second quarter of 2020 as compared to the adjusted EBITDA margin of 32% achieved during the first quarter of 2020.

    "At the end of June 2020 our ROV fleet size was 250, unchanged from the first quarter.  For the second quarter, utilization was 59%, down from 65% achieved for the quarter ended March 31, 2020.  As of June 30, 2020, we had ROV contracts on 86 of the 139 floating rigs under contract, resulting in a drill support market share of 62%.

    "Subsea Products adjusted operating results declined during the second quarter of 2020, as compared to the first quarter of 2020, on significantly lower revenue.  Revenue in our manufactured products business was impacted by the delayed receipt of materials, customer-driven project delays, and reduced working hours due to COVID-19.  Revenue in our service and rental business declined due to decreased activity, including the uncertainty of timing of our riserless light well intervention project in Angola.  Persistent cost-reduction efforts helped us to achieve an adjusted operating margin consistent with the margin generated in the first quarter of 2020.

    "Our Subsea Products backlog at June 30, 2020 was $486 million, compared to our March 31, 2020 backlog of $528 million.  As expected, there were low levels of bookings during the second quarter, as many of our customers delayed investment decisions due to the uncertainties regarding oil prices and potential COVID-19-related operating risks.  Revenue replacement during the quarter was 67% and our book-to-bill ratio for the trailing 12 months was 0.83.

    "The second quarter 2020 Subsea Projects adjusted operating performance improved, as compared to the first quarter of 2020, on lower revenue.  Revenue declined due to decreased customer activity, but we were pleased that adjusted operating results improved due to better project execution and ongoing cost-reduction activity.  Asset Integrity's adjusted operating results declined sequentially on lower revenue and as a result of non-recurring costs on certain completed projects.

    "For our non-energy segment, Advanced Technologies, second quarter 2020 adjusted operating results improved sequentially due to good performance from our government businesses.  COVID-19 continues to adversely affect our commercial businesses.  However cost reduction measures implemented during the first quarter of 2020 limited the financial impact on our second quarter 2020 results.  Unallocated Expenses for the quarter were sequentially lower as the return on market-based assets held in a trust for the benefit of certain post-retirement obligations improved, as compared to a first quarter loss.  Additionally, we had reduced information technology costs during the quarter.

    "For the second quarter of 2020, our cash balance increased to $334 million, as we generated $26.9 million of free cash flow, largely driven by positive contributions from operations and working capital, and continued scrutiny of our capital expenditures.

    "Although we are encouraged by our second quarter 2020 results, uncertainty remains for the rest of 2020.  Many of the markets we serve will likely continue to be impacted by the effects of and associated responses to COVID-19, as well as potential reductions in customer spending as a consequence of the volatility in the macro drivers surrounding commodity prices.  As a result, we are not providing segment financial guidance for the third quarter or second half of 2020.  We affirm that Unallocated Expenses are forecast to be in the high-$20 million range per quarter.  For the year, we affirm guidance for capital expenditures in the range of $45 million to $65 million, our cash tax payments in the range of $30 million to $35 million, and our expectation of CARES Act tax refunds in the range of $16 million to $34 million.

    "In our first quarter 2020 earnings release, we outlined our plan for a targeted reduction of annualized expenses in the range of $125 million to $160 million by the end of 2020, inclusive of $35 million to $40 million of reduced depreciation expense.  These cost reduction efforts are progressing well, and we estimate that, since launching those efforts, approximately $85 million of annualized cost reductions have been initiated, with additional savings expected to be achieved throughout the remainder of the year. We continue to expect the cash costs associated with these actions to approximate $15 million in 2020.

    "Preserving our liquidity and balance sheet remains a high priority in the current environment.  We expect to generate positive free cash flow for the full year of 2020 based on actions we are taking to achieve cost reductions, reduced capital spending, lower cash taxes, our expectation for CARES Act tax refunds, and cash expected to be generated from working capital for the remainder of the year."

    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, future expected business and financial performance and prospects of Oceaneering.  More specifically, the forward-looking statements in this press release include the statements concerning Oceaneering's: forecasted Unallocated Expenses per quarter, and annual capital expenditures and cash tax payments; targeted reduction range of annualized expenses, including depreciation expense; timing and anticipation of additional savings from cost reduction actions already initiated; cash costs associated with cost reduction actions; belief in generating positive free cash flow during 2020, and the bases for that belief, including expectations regarding: actions to achieve cost reductions, capital spending, cash taxes, CARES Act tax refunds, and cash from working capital for the remainder of the year.

    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, including worldwide demand for and prices of oil and natural gas, oil and natural gas production growth and the supply and demand of offshore drilling rigs; actions by members of OPEC and other oil exporting countries; decisions about offshore developments to be made by oil and gas exploration, development and production companies; the use of subsea completions and our ability to capture associated market share; general economic and business conditions and industry trends; the strength of the industry segments in which we are involved; the continuing effects of the COVID-19 pandemic and the governmental, customer, supplier, and other responses thereto; cancellations of contracts, change orders and other contractual modifications and the resulting adjustments to our backlog; collections from our customers; our future financial performance, including as a result of the availability, terms and deployment of capital; the consequences of significant changes in currency exchange rates; the volatility and uncertainties of credit markets; changes in tax laws, regulations and interpretation by taxing authorities; changes in, or our ability to comply with, other laws and governmental regulations, including those relating to the environment; the continued availability of qualified personnel; our ability to obtain raw materials and parts on a timely basis and, in some cases, from limited sources; operating risks normally incident to offshore exploration, development and production operations; hurricanes and other adverse weather and sea conditions; cost and time associated with drydocking of our vessels; the highly competitive nature of our businesses; adverse outcomes from legal or regulatory proceedings; the risks associated with integrating businesses we acquire; rapid technological changes; and social, political, military and economic situations in foreign countries where we do business and the possibilities of civil disturbances, war, other armed conflicts or terrorist attacks.  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 10Q filed with the Securities and Exchange Commission. You should not place undue reliance on forward-looking statements.  Except to the extent required by applicable law, Oceaneering undertakes no obligation to update or revise any forward-looking statement.

    Oceaneering is a global provider of engineered services and products, primarily to the offshore energy industry.  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:
    Mark Peterson
    Vice President, Corporate Development and Investor Relations
    Oceaneering International, Inc.
    713-329-4507
    investorrelations@oceaneering.com 

    OCEANEERING INTERNATIONAL, INC. AND SUBSIDIARIES



















    CONDENSED CONSOLIDATED BALANCE SHEETS


































    Jun 30,
    2020


    Dec 31,
    2019














    (in thousands)

    ASSETS

















    Current assets (including cash and cash equivalents of $333,509 and $373,655)






    $

    1,131,908



    $

    1,244,436



    Net property and equipment







    647,864



    776,532



    Other assets










    349,012



    719,695





    Total Assets






    $

    2,128,784



    $

    2,740,663




















    LIABILITIES AND EQUITY










    Current liabilities










    $

    452,444



    $

    600,956



    Long-term debt










    806,006



    796,516



    Other long-term liabilities






    244,925



    267,782



    Equity










    625,409



    1,075,409





    Total Liabilities and Equity






    $

    2,128,784



    $

    2,740,663




















    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS




























    For the Three Months Ended


    For the Six Months Ended










    Jun 30,
    2020


    Jun 30,
    2019


    Mar 31,
    2020


    Jun 30,

    2020


    Jun 30,
    2019










    (in thousands, except per share amounts)




















    Revenue






    $

    427,216



    $

    495,781



    $

    536,668



    $

    963,884



    $

    989,667



    Cost of services and products


    384,679



    453,798



    489,916



    874,595



    920,097




    Gross margin


    42,537



    41,983



    46,752



    89,289



    69,570



    Selling, general and administrative expense


    47,719



    51,618



    55,741



    103,460



    100,919



    Long-lived assets impairments






    68,763



    68,763





    Goodwill impairment






    303,005



    303,005






    Income (loss) from operations




    (5,182)



    (9,635)



    (380,757)



    (385,939)



    (31,349)



    Interest income






    511



    1,848



    1,277



    1,788



    4,452



    Interest expense, net of amounts capitalized


    (11,611)



    (10,199)



    (12,462)



    (24,073)



    (19,623)



    Equity in income (losses) of unconsolidated affiliates


    674





    1,197



    1,871



    (164)



    Other income (expense), net


    (3,660)



    7



    (7,128)



    (10,788)



    726




    Income (loss) before income taxes


    (19,268)



    (17,979)



    (397,873)



    (417,141)



    (45,958)



    Provision (benefit) for income taxes


    5,520



    17,203



    (30,275)



    (24,755)



    14,051




    Net Income (Loss)


    $

    (24,788)



    $

    (35,182)



    $

    (367,598)



    $

    (392,386)



    $

    (60,009)




















    Weighted average diluted shares outstanding


    99,273



    98,929



    99,055



    99,164



    98,822


    Diluted earnings (loss) per share


    $

    (0.25)



    $

    (0.36)



    $

    (3.71)



    $

    (3.96)



    $

    (0.61)




















    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 Six Months Ended







    Jun 30, 2020


    Jun 30, 2019


    Mar 31, 2020


    Jun 30, 2020


    Jun 30, 2019







    ($ in thousands)












    Remotely Operated Vehicles














    Revenue



    $

    98,778



    $

    120,363



    $

    111,780



    $

    210,558



    $

    220,709



    Gross margin



    $

    13,788



    $

    17,360



    $

    18,112



    $

    31,900



    $

    26,781


    Operating income (loss)



    $

    5,975



    $

    8,688



    $

    9,066



    $

    15,041



    $

    10,106


    Operating income (loss) %



    6

    %


    7

    %


    8

    %


    7

    %


    5

    %


    Days available



    22,750



    25,006



    22,750



    45,500



    49,512



    Days utilized



    13,501



    15,423



    14,853



    28,354



    28,365



    Utilization



    59

    %


    62

    %


    65

    %


    62

    %


    57

    %
















    Subsea Products














    Revenue



    $

    130,655



    $

    138,910



    $

    194,838



    $

    325,493



    $

    267,754



    Gross margin



    $

    21,578



    $

    21,029



    $

    28,639



    $

    50,217



    $

    33,344


    Operating income (loss)



    $

    9,068



    $

    7,413



    $

    (91,858)



    $

    (82,790)



    $

    6,937


    Operating income (loss) %



    7

    %


    5

    %


    (47)

    %


    (25)

    %


    3

    %

    Backlog at end of period



    $

    486,000



    $

    596,000



    $

    528,000



    $

    486,000



    $

    596,000

















    Subsea Projects














    Revenue



    $

    56,326



    $

    75,104



    $

    61,455



    $

    117,781



    $

    164,832



    Gross margin



    $

    6,331



    $

    5,472



    $

    (2,114)



    $

    4,217



    $

    14,505


    Operating income (loss)



    $

    845



    $

    87



    $

    (145,290)



    $

    (144,445)



    $

    2,979


    Operating income (loss) %



    2

    %


    %


    (236)

    %


    (123)

    %


    2

    %
















    Asset Integrity














    Revenue



    $

    48,077



    $

    61,156



    $

    59,132



    $

    107,209



    $

    121,845



    Gross margin



    $

    4,155



    $

    6,423



    $

    8,729



    $

    12,884



    $

    12,695


    Operating income (loss)



    $

    (2,598)



    $

    (1,302)



    $

    (109,441)



    $

    (112,039)



    $

    (2,015)


    Operating income (loss) %



    (5)

    %


    (2)

    %


    (185)

    %


    (105)

    %


    (2)

    %
















    Advanced Technologies














    Revenue



    $

    93,380



    $

    100,248



    $

    109,463



    $

    202,843



    $

    214,527



    Gross margin



    $

    15,089



    $

    13,386



    $

    13,428



    $

    28,517



    $

    28,634


    Operating income (loss)



    $

    9,707



    $

    7,241



    $

    (10,585)



    $

    (878)



    $

    16,840


    Operating income (loss) %



    10

    %


    7

    %


    (10)

    %


    %


    8

    %















    Unallocated Expenses













    Gross margin



    $

    (18,404)



    $

    (21,687)



    $

    (20,042)



    $

    (38,446)



    $

    (46,389)


    Operating income (loss)



    $

    (28,179)



    $

    (31,762)



    $

    (32,649)



    $

    (60,828)



    $

    (66,196)















    Total


















    Revenue



    $

    427,216



    $

    495,781



    $

    536,668



    $

    963,884



    $

    989,667



    Gross margin



    $

    42,537



    $

    41,983



    $

    46,752



    $

    89,289



    $

    69,570


    Operating income (loss)



    $

    (5,182)



    $

    (9,635)



    $

    (380,757)



    $

    (385,939)



    $

    (31,349)


    Operating income (loss) %



    (1)

    %


    (2)

    %


    (71)

    %


    (40)

    %


    (3)

    %


    The above Segment Information does not include adjustments for non-recurring transactions.   See the tables in our Reconciliations of Non-GAAP to GAAP Financial Information section for financial measures that management considers representative of our ongoing operations.
















     

    SELECTED CASH FLOW INFORMATION


















    For the Three Months Ended


    For the Six Months Ended







    Jun 30, 2020


    Jun 30, 2019


    Mar 31, 2020


    Jun 30, 2020


    Jun 30, 2019







    (in thousands)













    Capital Expenditures, including Acquisitions



    $

    10,631



    $

    40,898



    $

    27,229



    $

    37,860



    70,862














    Depreciation and amortization:












    Energy Services and Products













    Remotely Operated Vehicles



    $

    22,892



    $

    26,871



    $

    25,725



    $

    48,617



    $

    54,861



    Subsea Products



    10,024



    12,366



    62,454



    72,478



    25,357



    Subsea Projects



    4,597



    7,550



    143,346



    147,943



    15,432



    Asset Integrity



    190



    1,570



    111,385



    111,575



    3,204


    Total Energy Services and Products



    37,703



    48,357



    342,910



    380,613



    98,854


    Advanced Technologies



    634



    765



    12,178



    12,812



    1,595


    Unallocated Expenses



    361



    1,182



    1,108



    1,469



    2,341



    Total Depreciation and Amortization



    $

    38,698



    $

    50,304



    $

    356,196



    $

    394,894



    $

    102,790

















    Goodwill and long-lived asset impairment expense, reflected in the depreciation and amortization expense above, was $310 million in the three months ended March 31, 2020 and the six months ended June 30, 2020.
















    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 (Loss) and Diluted Earnings (Loss) 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, EBITDA Margins, 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.


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






















    For the Three Months Ended






    Jun 30, 2020

    Jun 30, 2019

    Mar 31, 2020






    Net Income
    (Loss)


    Diluted EPS


    Net Income
    (Loss)


    Diluted EPS


    Net Income
    (Loss)


    Diluted EPS






    (in thousands, except per share amounts)








    Net income (loss) and diluted EPS as reported in accordance with GAAP


    $

    (24,788)



    $

    (0.25)



    $

    (35,182)



    $

    (0.36)



    $

    (367,598)



    $

    (3.71)


    Pre-tax adjustments for the effects of:














    Long-lived assets impairments










    68,763





    Long-lived assets write-offs










    7,328





    Goodwill impairment










    303,005





    Restructuring expenses and other


    5,708









    6,630





    Foreign currency (gains) losses


    3,908





    (59)





    7,050




    Total pre-tax adjustments


    9,616





    (59)





    392,776




















    Tax effect on pre-tax adjustments at the applicable jurisdictional statutory rate in effect for respective periods


    (2,331)





    12





    (45,355)




    Discrete tax items:













        Share-based compensation


    16





    1





    987




        Uncertain tax positions


    735





    1,268





    (9,652)




        U.S. CARES Act


    1,159









    (33,784)




        Valuation allowances


    3,245









    65,208




        Other


    (1,887)





    2,436





    950





    Total discrete tax adjustments


    3,268





    3,705





    23,709





    Total of adjustments


    10,553





    3,658





    371,130




    Adjusted Net Income (Loss)


    $

    (14,235)



    $

    (0.14)



    $

    (31,524)



    $

    (0.32)



    $

    3,532



    $

    0.04


    Weighted average diluted shares outstanding utilized for Adjusted Net Income (Loss)




    99,273





    98,929





    99,649


















     

















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


























    For the Six Months Ended







    Jun 30, 2020

    Jun 30, 2019










    Net Income
    (Loss)


    Diluted EPS


    Net Income

    (Loss)


    Diluted EPS










    (in thousands, except per share amounts)








    Net income (loss) and diluted EPS as reported in accordance with GAAP






    $

    (392,386)



    $

    (3.96)



    $

    (60,009)



    $

    (0.61)


    Pre-tax adjustments for the effects of:














    Long-lived assets impairments






    68,763









    Long-lived assets write-offs






    7,328









    Goodwill impairment






    303,005









    Restructuring expenses and other






    12,338









    Foreign currency (gains) losses






    10,958





    (673)




    Total pre-tax adjustments






    402,392





    (673)




















    Tax effect on pre-tax adjustments at the applicable jurisdictional statutory rate in effect for respective periods






    (47,686)





    141




    Discrete tax items:













        Share-based compensation






    1,003





    987




        Uncertain tax positions






    (8,917)





    2,290




        U.S. CARES Act






    (32,625)








        Valuation allowances






    68,453





    1,539




        Other






    (937)





    295





    Total discrete tax adjustments






    26,977





    5,111





    Total of adjustments






    381,683





    4,579




    Adjusted Net Income (Loss)






    $

    (10,703)



    $

    (0.11)



    $

    (55,430)



    $

    (0.56)


    Weighted average diluted shares outstanding utilized for Adjusted Net Income (Loss)








    99,164





    98,822


















     















    EBITDA and Adjusted EBITDA and Margins




















    For the Three Months Ended


    For the Six Months Ended






    Jun 30, 2020


    Jun 30, 2019


    Mar 31, 2020


    Jun 30, 2020


    Jun 30, 2019






    ($ in thousands)















    Net income (loss)



    $

    (24,788)



    $

    (35,182)



    $

    (367,598)



    $

    (392,386)



    $

    (60,009)


    Depreciation and amortization



    38,698



    50,304



    356,196



    394,894



    102,790



    Subtotal



    13,910



    15,122



    (11,402)



    2,508



    42,781


    Interest expense, net of interest income


    11,100



    8,351



    11,185



    22,285



    15,171


    Amortization included in interest expense


    333



    (335)



    (333)





    (675)


    Provision (benefit) for income taxes



    5,520



    17,203



    (30,275)



    (24,755)



    14,051



    EBITDA



    30,863



    40,341



    (30,825)



    38



    71,328


    Adjustments for the effects of:













    Long-lived assets impairments







    68,763



    68,763





    Restructuring expenses and other



    5,708





    6,630



    12,338





    Foreign currency (gains) losses



    3,908



    (59)



    7,050



    10,958



    (673)




    Total of adjustments



    9,616



    (59)



    82,443



    92,059



    (673)



    Adjusted EBITDA



    $

    40,479



    $

    40,282



    $

    51,618



    $

    92,097



    $

    70,655
















    Revenue



    $

    427,216



    $

    495,781



    $

    536,668



    $

    963,884



    $

    989,667
















    EBITDA margin %



    7

    %


    8

    %


    (6)

    %


    %


    7

    %

    Adjusted EBITDA margin %



    9

    %


    8

    %


    10

    %


    10

    %


    7

    %















     

    Free Cash Flow
















    For the Three Months Ended


    For the Six Months Ended




    Jun 30, 2020


    Jun 30, 2019


    Mar 31, 2020


    Jun 30, 2020


    Jun 30, 2019




    (in thousands)

    Net Income (loss)


    $

    (24,788)



    $

    (35,182)



    $

    (367,598)



    $

    (392,386)



    $

    (60,009)


    Non-cash adjustments:












    Depreciation and amortization, including goodwill impairment


    38,698



    50,304



    356,196



    394,894



    102,790



    Other non-cash


    41



    495



    64,137



    64,178



    557


    Other increases (decreases) in cash from operating activities


    23,567



    37,968



    (84,885)



    (61,318)



    29,371


    Cash flow provided by (used in) operating activities


    37,518



    53,585



    (32,150)



    5,368



    72,709


    Purchases of property and equipment


    (10,631)



    (40,898)



    (27,229)



    (37,860)



    (70,862)


    Free Cash Flow


    $

    26,887



    $

    12,687



    $

    (59,379)



    $

    (32,492)



    $

    1,847


























     




    Adjusted Operating Income (Loss) and Margins by Segment






    For the Three Months Ended June 30, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    5,975



    $

    9,068



    $

    845



    $

    (2,598)



    $

    9,707



    $

    (28,179)



    $

    (5,182)


    Adjustments for the effects of:















    Restructuring expenses and other


    1,336



    1,646



    1,250



    1,536



    (235)



    175



    5,708




    Total of adjustments


    1,336



    1,646



    1,250



    1,536



    (235)



    175



    5,708



















    Adjusted Operating Income (Loss)


    $

    7,311



    $

    10,714



    $

    2,095



    $

    (1,062)



    $

    9,472



    $

    (28,004)



    $

    526



















    Revenue


    $

    98,778



    $

    130,655



    $

    56,326



    $

    48,077



    $

    93,380





    $

    427,216


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


    6

    %


    7

    %


    2

    %


    (5)

    %


    10

    %




    (1)

    %

    Operating income (loss)% using adjusted amounts


    7

    %


    8

    %


    4

    %


    (2)

    %


    10

    %




    %






















    For the Three Months Ended June 30, 2019





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    8,688



    $

    7,413



    $

    87



    $

    (1,302)



    $

    7,241



    $

    (31,762)



    $

    (9,635)



















    Adjusted Operating Income (Loss)


    $

    8,688



    $

    7,413



    $

    87



    $

    (1,302)



    $

    7,241



    $

    (31,762)



    $

    (9,635)



















    Revenue


    $

    120,363



    $

    138,910



    $

    75,104



    $

    61,156



    $

    100,248





    $

    495,781


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


    7

    %


    5

    %


    %


    (2)

    %


    7

    %




    (2)

    %

    Operating income (loss)% using adjusted amounts


    7

    %


    5

    %


    %


    (2)

    %


    7

    %




    (2)

    %


     




    Adjusted Operating Income (Loss) and Margins by Segment























    For the Three Months Ended March 31, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    9,066



    $

    (91,858)



    $

    (145,290)



    $

    (109,441)



    $

    (10,585)



    $

    (32,649)



    $

    (380,757)


    Adjustments for the effects of:
















    Long-lived assets impairments




    54,859



    7,689





    6,215





    68,763



    Long-lived assets write-offs






    7,328









    7,328



    Goodwill impairment




    51,302



    129,562



    110,753



    11,388





    303,005



    Restructuring expenses and other


    713



    1,668



    1,480



    1,694



    795



    280



    6,630




    Total of adjustments


    713



    107,829



    146,059



    112,447



    18,398



    280



    385,726


    Adjusted Operating Income (Loss)


    $

    9,779



    $

    15,971



    $

    769



    $

    3,006



    $

    7,813



    $

    (32,369)



    $

    4,969



















    Revenue


    $

    111,780



    $

    194,838



    $

    61,455



    $

    59,132



    $

    109,463





    $

    536,668


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


    8

    %


    (47)

    %


    (236)

    %


    (185)

    %


    (10)

    %




    (71)

    %

    Operating income (loss) % using adjusted amounts


    9

    %


    8

    %


    1

    %


    5

    %


    7

    %




    1

    %


     




    Adjusted Operating Income (Loss) and Margins by Segment






    For the Six Months Ended June 30, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    15,041



    $

    (82,790)



    $

    (144,445)



    $

    (112,039)



    $

    (878)



    $

    (60,828)



    $

    (385,939)


    Adjustments for the effects of:















    Long-lived assets impairments




    54,859



    7,689





    6,215





    68,763



    Long-lived assets write-offs






    7,328









    7,328



    Goodwill impairment




    51,302



    129,562



    110,753



    11,388





    303,005



    Restructuring expenses and other


    2,049



    3,314



    2,730



    3,230



    560



    455



    12,338




    Total of adjustments


    2,049



    109,475



    147,309



    113,983



    18,163



    455



    391,434



















    Adjusted Operating Income (Loss)


    $

    17,090



    $

    26,685



    $

    2,864



    $

    1,944



    $

    17,285



    $

    (60,373)



    $

    5,495



















    Revenue


    $

    210,558



    $

    325,493



    $

    117,781



    $

    107,209



    $

    202,843





    $

    963,884


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


    7

    %


    (25)

    %


    (123)

    %


    (105)

    %


    %




    (40)

    %

    Operating income (loss)% using adjusted amounts


    8

    %


    8

    %


    2

    %


    2

    %


    9

    %




    1

    %






















    For the Six Months Ended June 30, 2019





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    10,106



    $

    6,937



    $

    2,979



    $

    (2,015)



    $

    16,840



    $

    (66,196)



    $

    (31,349)



















    Adjusted Operating Income (Loss)


    $

    10,106



    $

    6,937



    $

    2,979



    $

    (2,015)



    $

    16,840



    $

    (66,196)



    $

    (31,349)



















    Revenue


    $

    220,709



    $

    267,754



    $

    164,832



    $

    121,845



    $

    214,527





    $

    989,667


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


    5

    %


    3

    %


    2

    %


    (2)

    %


    8

    %




    (3)

    %

    Operating income (loss)% using adjusted amounts


    5

    %


    3

    %


    2

    %


    (2)

    %


    8

    %




    (3)

    %


     




    EBITDA and Adjusted EBITDA and Margins by Segment






    For the Three Months Ended June 30, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses
    and other


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    5,975



    $

    9,068



    $

    845



    $

    (2,598)



    $

    9,707



    $

    (28,179)



    $

    (5,182)


    Adjustments for the effects of:















    Depreciation and amortization


    22,892



    10,024



    4,597



    190



    634



    361



    38,698



    Other pre-tax












    (2,653)



    (2,653)



    EBITDA


    28,867



    19,092



    5,442



    (2,408)



    10,341



    (30,471)



    30,863


    Adjustments for the effects of:















    Restructuring expenses and other


    1,336



    1,646



    1,250



    1,536



    (235)



    175



    5,708



    Foreign currency (gains) losses












    3,908



    3,908




    Total of adjustments


    1,336



    1,646



    1,250



    1,536



    (235)



    4,083



    9,616


    Adjusted EBITDA


    $

    30,203



    $

    20,738



    $

    6,692



    $

    (872)



    $

    10,106



    $

    (26,388)



    $

    40,479



















    Revenue


    $

    98,778



    $

    130,655



    $

    56,326



    $

    48,077



    $

    93,380





    $

    427,216


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


    6

    %


    7

    %


    2

    %


    (5)

    %


    10

    %




    (1)

    %

    EBITDA Margin


    29

    %


    15

    %


    10

    %


    (5)

    %


    11

    %




    7

    %

    Adjusted EBITDA Margin


    31

    %


    16

    %


    12

    %


    (2)

    %


    11

    %




    9

    %






















    For the Three Months Ended June 30, 2019





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses
    and other


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    8,688



    $

    7,413



    $

    87



    $

    (1,302)



    $

    7,241



    $

    (31,762)



    $

    (9,635)


    Adjustments for the effects of:















    Depreciation and amortization


    26,871



    12,366



    7,550



    1,570



    765



    1,182



    50,304



    Other pre-tax












    (328)



    (328)



    EBITDA


    35,559



    19,779



    7,637



    268



    8,006



    (30,908)



    40,341


    Adjustments for the effects of:















    Foreign currency (gains) losses












    (59)



    (59)




    Total of adjustments












    (59)



    (59)


    Adjusted EBITDA


    $

    35,559



    $

    19,779



    $

    7,637



    $

    268



    $

    8,006



    $

    (30,967)



    $

    40,282



















    Revenue


    $

    120,363



    $

    138,910



    $

    75,104



    $

    61,156



    $

    100,248





    $

    495,781


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


    7

    %


    5

    %


    %


    (2)

    %


    7

    %




    (2)

    %

    EBITDA Margin


    30

    %


    14

    %


    10

    %


    %


    8

    %




    8

    %

    Adjusted EBITDA Margin


    30

    %


    14

    %


    10

    %


    %


    8

    %




    8

    %

     




    EBITDA and Adjusted EBITDA and Margins by Segment






    For the Three Months Ended March 31, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses
    and other


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    9,066



    $

    (91,858)



    $

    (145,290)



    $

    (109,441)



    $

    (10,585)



    $

    (32,649)



    $

    (380,757)


    Adjustments for the effects of:















    Depreciation and amortization


    25,725



    62,454



    143,346



    111,385



    12,178



    1,108



    356,196



    Other pre-tax












    (6,264)



    (6,264)



    EBITDA


    34,791



    (29,404)



    (1,944)



    1,944



    1,593



    (37,805)



    (30,825)


    Adjustments for the effects of:















    Long-lived assets impairments




    54,859



    7,689





    6,215





    68,763



    Restructuring expenses and other


    713



    1,668



    1,480



    1,694



    795



    280



    6,630



    Foreign currency (gains) losses












    7,050



    7,050




    Total of adjustments


    713



    56,527



    9,169



    1,694



    7,010



    7,330



    82,443


    Adjusted EBITDA


    $

    35,504



    $

    27,123



    $

    7,225



    $

    3,638



    $

    8,603



    $

    (30,475)



    $

    51,618



















    Revenue


    $

    111,780



    $

    194,838



    $

    61,455



    $

    59,132



    $

    109,463





    $

    536,668


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


    8

    %


    (47)

    %


    (236)

    %


    (185)

    %


    (10)

    %




    (71)

    %

    EBITDA Margin


    31

    %


    (15)

    %


    (3)

    %


    3

    %


    1

    %




    (6)

    %

    Adjusted EBITDA Margin


    32

    %


    14

    %


    12

    %


    6

    %


    8

    %




    10

    %

     




    EBITDA and Adjusted EBITDA and Margins by Segment






    For the Six Months Ended June 30, 2020





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses
    and other


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    15,041



    $

    (82,790)



    $

    (144,445)



    $

    (112,039)



    $

    (878)



    $

    (60,828)



    $

    (385,939)


    Adjustments for the effects of:















    Depreciation and amortization


    48,617



    72,478



    147,943



    111,575



    12,812



    1,469



    394,894



    Other pre-tax












    (8,917)



    (8,917)



    EBITDA


    63,658



    (10,312)



    3,498



    (464)



    11,934



    (68,276)



    38


    Adjustments for the effects of:















    Long-lived assets impairments




    54,859



    7,689





    6,215





    68,763



    Restructuring expenses and other


    2,049



    3,314



    2,730



    3,230



    560



    455



    12,338



    Foreign currency (gains) losses












    10,958



    10,958




    Total of adjustments


    2,049



    58,173



    10,419



    3,230



    6,775



    11,413



    92,059


    Adjusted EBITDA


    $

    65,707



    $

    47,861



    $

    13,917



    $

    2,766



    $

    18,709



    $

    (56,863)



    $

    92,097



















    Revenue


    $

    210,558



    $

    325,493



    $

    117,781



    $

    107,209



    $

    202,843





    $

    963,884


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


    7

    %


    (25)

    %


    (123)

    %


    (105)

    %


    %




    (40)

    %

    EBITDA Margin


    30

    %


    (3)

    %


    3

    %


    %


    6

    %




    %

    Adjusted EBITDA Margin


    31

    %


    15

    %


    12

    %


    3

    %


    9

    %




    10

    %






















    For the Six Months Ended June 30, 2019





    Remotely
    Operated
    Vehicles


    Subsea
    Products


    Subsea
    Projects


    Asset
    Integrity


    Advanced
    Tech.


    Unallocated
    Expenses
    and other


    Total





    ($ in thousands)

    Operating Income (Loss) as reported in accordance with GAAP


    $

    10,106



    $

    6,937



    $

    2,979



    $

    (2,015)



    $

    16,840



    $

    (66,196)



    $

    (31,349)


    Adjustments for the effects of:















    Depreciation and amortization


    54,861



    25,357



    15,432



    3,204



    1,595



    2,341



    102,790



    Other pre-tax












    (113)



    (113)



    EBITDA


    64,967



    32,294



    18,411



    1,189



    18,435



    (63,968)



    71,328


    Adjustments for the effects of:















    Foreign currency (gains) losses












    (673)



    (673)




    Total of adjustments












    (673)



    (673)


    Adjusted EBITDA


    $

    64,967



    $

    32,294



    $

    18,411



    $

    1,189



    $

    18,435



    $

    (64,641)



    $

    70,655



















    Revenue


    $

    220,709



    $

    267,754



    $

    164,832



    $

    121,845



    $

    214,527





    $

    989,667


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


    5

    %


    3

    %


    2

    %


    (2)

    %


    8

    %




    (3)

    %

    EBITDA Margin


    29

    %


    12

    %


    11

    %


    1

    %


    9

    %




    7

    %

    Adjusted EBITDA Margin


    29

    %


    12

    %


    11

    %


    1

    %


    9

    %




    7

    %

     

    Cision View original content:http://www.prnewswire.com/news-releases/oceaneering-reports-second-quarter-2020-results-301102562.html

    SOURCE Oceaneering International, Inc.

    Categories: Press Releases
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