Tuboscope Inc. Announces 1999 Second Quarter Results
HOUSTON--(BUSINESS WIRE)--Aug. 3, 1999--Tuboscope Inc. (NYSE:TBI)
today announced results of operations for the second quarter ended
June 30, 1999. Revenues for the quarter were $92.7 million, down from
$153.5 million posted in the second quarter of 1998. The decline in
revenue reflected the 33 percent decline in worldwide drilling
activity and led to a net loss of $0.03 per diluted share for the
quarter compared to 1998 second quarter earnings per common share of
$0.31. Gross profit before goodwill amortization of $19.4 million or
20.9% of sales, was down from 30.9% of sales in the second quarter of
1998. Earnings before interest, taxes, depreciation and amortization
fell 67 percent to $11.9 million and operating profit declined 89
percent to $3.2 million.
Although oil prices increased significantly during the quarter,
activity levels as measured by the rig count continued to erode
resulting in lower sales in the quarter. Tubular Services revenue
declined 39 percent, from $62.4 million in the second quarter of 1998
to $37.7 million. Solids Control Products and Services revenue was
down 38 percent from $43.7 million in the second quarter of 1998 to
$26.9 million. Coiled Tubing and Wireline Products sales were $18.4
million in the second quarter of 1999, a 41 percent decline from
second quarter 1998 sales of $31.3 million. Backlog for Coiled Tubing
and Wireline Products was $27.9 million at June 30, 1999, down 29
percent from December 31, 1998 levels. Pipeline and Other Industrial
Services revenue was $9.7 million, down 40 percent from second quarter
1998 sales of $16.2 million.
John F. Lauletta, President and CEO of Tuboscope, commented, "Our
second quarter results reflect the depressed activity levels in our
markets. During the quarter we continued to focus on cash flow and
reducing operating expenses. We are optimistic that worldwide drilling
activity has bottomed out as activity levels in North America have
begun to increase due to gas related drilling. However, the
international markets historically have taken longer to recover."
Mr. Lauletta continued, "Our merger with Newpark Resources is on
schedule and we expect to close the transaction by the end of the
third quarter, subject to regulatory and shareholder approvals."
Tuboscope completed the quarter ended June 30, 1999 with $7.5
million in cash, $239.7 million in debt, and $334.8 million in
shareholders equity. Capital expenditures were $3.4 million in the
quarter.
Tuboscope is the world's leading provider of oilfield tubular
inspection and internal coating services; coiled tubing equipment used
in oilfield production and drilling operations; solids control
services and equipment used in oilfield drilling operations; and
inspection equipment used in steel mill operations. Tuboscope provides
in-line inspection pipeline inspection services, high-pressure
fiberglass tubulars and industrial inspection services worldwide as
well. Tuboscope is headquartered in Houston, Texas and services
markets in 49 countries. The company is traded on the New York Stock
Exchange under the symbol "TBI."
The foregoing contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. The forward-looking statements
are those that do not state historical facts and are inherently
subject to risk and uncertainties. The forward-looking statements
contained herein are based on current expectations and entail various
risks and uncertainties that could cause actual results to differ
materially from those projected in the forward-looking statements.
Such risks and uncertainties include, among others, the cyclical
nature of the oilfield services industry, risks associated with the
Company's significant foreign operations, compliance with
environmental laws, risks associated with growth through acquisitions
and other factors discussed in the Company's Annual Report on Form
10-K for the year ended December 31, 1998 under the caption "Factors
Affecting Future Operating Results".
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