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Gold/Mining/Energy : Key Energy (KEG) -- Ignore unavailable to you. Want to Upgrade?

To: Paul Lee who wrote (229)	10/24/2001 7:18:18 AM
From: Paul Lee	Respond to of 241

Key Energy Announces Record Quarter MIDLAND, Texas--(BUSINESS WIRE)--Oct. 24, 2001--Key Energy Services, Inc. (NYSE: KEG) announced today record EBITDA and net income for the first fiscal quarter ended September 30, 2001. Net income before extraordinary items soared to approximately $29.0 million, or $0.28 per fully diluted share, compared to $7.5 million, or $0.08 per fully diluted share, for the year earlier period, representing a 287% increase. These results represent the tenth consecutive quarterly increase in EBITDA and net income for the company. EBITDA for the September 2001 quarter also reached record levels, rising to approximately $76.2 million, compared to approximately $46.8 million for the quarter ended September 30, 2000. EBITDA margins for the September 2001 quarter reached a record 30.6% versus 24.4% for the year earlier period. During the quarter, Key continued to use its significant cash flow to strengthen its balance sheet and reduce its long-term indebtedness. As of October 24, 2001, Key's net long-term funded debt has decreased to $443.6 million, or approximately 46.2% of total capitalization. This brings the total long-term debt reduction to almost $400 million since March 31, 1999. The strong operating performance during the quarter reflects Key's leading market position, geographic diversification and a balance between natural gas and crude oil markets. Equipment utilization and pricing remained strong during the quarter allowing the Company to achieve its highest gross margin for well service rigs and drilling rigs in its history. However, during the second half of September, particularly after the horrific events of September 11th, the Company began to experience a modest reduction in hours in several of its operating regions. The regions with the highest rate of decline have large concentrations of natural gas production and are generally more expensive to drill. Key experienced a loss of some completion work and large workover jobs in these areas. Oil producing regions were less affected and, today, continue to remain strong. Francis D. John, the Company's Chairman and Chief Executive Officer stated, "It is impossible to comment on the quarterly results without first extending Key's sincere condolences to those who suffered a loss as a result of the senseless terrorist attacks on September 11th. We salute the heroic work that continues today in the recovery, rescue and ongoing military action." Mr. John continued, "Our short-term visibility is clouded, with commodity prices having declined as a result of reduced demand for natural gas and crude oil. However, even at today's lower levels, commodity prices are still higher than long-term historical averages. In fact, we believe that most onshore oil and gas development projects remain economic at today's commodity prices. Nonetheless, if drilling for new oil and gas reserves remains depressed, the country's ability to meet forecasted medium and longer-term energy demand will suffer. Commodity prices will then rebound, sending oilfield service activity even higher. The cycle is, and will be, self-correcting." "We believe the long-term outlook for energy remains strong." Mr. John continued, "Key is well positioned. Our strong balance sheet, excellent liquidity and strong maintenance-based revenue stream should allow us to be opportunistic in a downturn. We constantly evaluate our level of capital spending, operating expenses and staffing needs and are prepared to respond to whatever the market may throw our way