Key Energy Reports Record Profit and EBITDA for First Quarter
EAST BRUNSWICK, N.J.--(BUSINESS WIRE)--Oct. 19, 2000--Key Energy Services, Inc. (NYSE:KEG) today reported a record profit of approximately $8.7 million or $0.09 per fully diluted share for the quarter ended Sept. 30, 2000 compared to a loss of approximately $9.5 million or ($0.11) per fully diluted share for the quarter ended Sept. 30, 1999. EBITDA, defined as earnings before interest, taxes, depreciation and amortization, more than doubled to approximately $46.8 million for the quarter ended Sept. 30, 2000 compared to approximately $21.5 million for the same period last year. Revenues for the quarter ended Sept. 30, 2000 increased 28% to approximately $191.8 million compared to $149.9 million for the quarter ended Sept. 30, 1999. Key has now recorded six consecutive quarters of sequential improvement in EBITDA and EBITDA margins. In the latest quarter, the Company's revenues grew by approximately $21.9 million or 13% compared to the June 2000 quarter while EBITDA increased approximately $12.0 million or 35% compared to the June 2000 quarter. Net income for the three months ended Sept. 30, 2000 included a gain of approximately $1.2 million or $0.01 per fully diluted share from the early retirement of $10.2 million of long term debt.
Gross margins from well servicing activities for the September 2000 quarter increased to 32.8% compared to 24.2% for the September 1999 quarter and 31.1% for the June 2000 quarter. Gross margins from contract drilling activities increased significantly to 21.2% for the September 2000 quarter compared to 13.3% for the September 1999 quarter and 17.7% for the June 2000 quarter. Outstanding lonf term debt, excluding capitalized leases, continued to decline to approximately $537.2 million at Sept. 30, 2000 while net funded debt to capitalization improved to approximately 57.7% at Sept. 30, 2000.
Francis D. John, the Company's chairman and chief executive officer, stated, "Market conditions have continued to improve as we expected. Customer spending has increased substantially since mid-summer and should continue to be strong through the December quarter and into calendar year 2001. The Company has been successful in raising rates for its drilling and well service rigs. As a result of these rate increases and improved efficiencies, the Company reported record EBITDA and EBITDA margins, surpassing those achieved in late calendar 1997."
Further, Mr. John noted, "We have been successful in mobilizing several new drilling rigs and are currently refurbishing more than 40 well service rigs. The majority of our refurbs involve our market leading 500 series rigs which are needed for deep gas completions and workovers." Mr. John continued, "We are pleased that our strong cash flow allows us to invest significantly in refurbishing and upgrading our equipment and also to continue to reduce debt." |
