Key Energy Announces Continued Strong Performance
MIDLAND, Texas--(BUSINESS WIRE)--Jan. 23, 2002--Key Energy Services, Inc. (NYSE: KEG) announced today its EBITDA and net income for the second fiscal quarter ended December 31, 2001. Net income for the quarter was approximately $19.5 million, or $0.19 per fully diluted share, compared to $11.2 million, or $0.11 per fully diluted share, for the year earlier period, representing an increase of 73%. The net income results include a foreign currency transaction loss of approximately $1.8 million of dollar-denominated receivables in Argentina resulting from the recent devaluation of Argentina's currency. The effects of this one-time charge was more than offset by the Company's recognition of an extraordinary after-tax gain of approximately $2.1 million in connection with the Company's early retirement of certain long-term debt.
EBITDA, which is defined to exclude the effects of the Argentina-related charge, for the December 2001 quarter was approximately $61.0 million, compared to approximately $51.5 million for the quarter ended December 31, 2000. EBITDA margins for the December 2001 quarter reached 28.6%, well ahead of the 25.3% realized for the three months ended December 31, 2000 and just slightly below the record 30.6% achieved in the quarter ended September 30, 2001.
In order to facilitate a comparison between Key and its peers, the Company, which has a June 30 fiscal year end, also disclosed its financial results for the twelve months ended December 31, 2001. Total revenues for the period were approximately $940.2 million, EBITDA was approximately $271.1 million and net income after extraordinary items was approximately $91.4 million, or $0.87 per fully diluted share. The Company's free cash flow, defined as EBITDA less cash interest expense less capital expenditures, was approximately $127.8 million for the twelve months ended December 31, 2001.
During the quarter ended December 31, 2001, Key continued to strengthen its balance sheet and reduce its long-term indebtedness. As of December 31, 2001, Key's net long-term funded debt, including cash and excluding capitalized leases, was approximately $371.8 million, or approximately 40.1% of total capitalization.
Francis D. John, Chairman and CEO stated, "We are pleased with our strong operating performance for our second fiscal quarter. As a result of our leading market position and operating efficiencies, we have been able to generate significant cash flow which has enabled us to substantially reduce debt and to strengthen the balance sheet. We have also been able to invest in over 200 rig refurbishments, upgrade our trucking fleet and develop technologies -- all of which will ultimately lead to improved productivity for our customers."
"While the short-term outlook for our industry remains somewhat uncertain, we continue to be optimistic about the long-term industry fundamentals, particularly related to natural gas," Mr. John continued, "As the U.S. economy rebounds, the declining supply of natural gas will serve as a catalyst for higher prices, more intense levels of activity and hopefully, a measured approach to U.S. energy policy. Until that rebound occurs, however, we expect to continue to report positive earnings and cash flow. Our comprehensive service offering, our consolidated market, and our significant well maintenance base of business allow Key to be less volatile during periods of lower commodity prices." |
