SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: Janaury 28, 1997
READING & BATES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-5587 73-0642271
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
901 Threadneedle, Suite 200, Houston, TX 77079
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (281) 496-5000
Item 7. Financial Statements and Exhibits
(c) Exhibits
Exhibit 99 - Press Release dated January 27, 1997 - Reading
& Bates announces 4th Quarter and Yearend 1996
earnings release.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf of the
undersigned thereunto duly authorized.
READING & BATES CORPORATION
By /s/T. W. Nagle
------------------------
T. W. Nagle
Executive Vice President,
Finance and Administration
(Principal Financial and
Accounting Officer)
Dated: January 28, 1997
EXHIBIT 99
RB Reports Improved Fourth Quarter and Year End 1996 Results
For additional information, please contact: Mr. Charles R. Ofner
(713) 496-5000
January 27, 1997, Houston, Texas ........ Reading & Bates
Corporation (RB-NYSE) reported net income of $77.9 million ($1.15 net
income per share after preferred stock dividends of $3.6 million) for the
year ended December 31, 1996, compared with net income of $21.8 million
($.28 net income per share after preferred stock dividends of $4.9
million) for the year ended December 31, 1995. Operating income for the
year ended December 31, 1996 was $107.4 million on revenues of $290.2
million, compared to operating income for the year ended December 31,
1995 of $38.2 million on revenues of $212.8 million. The $69.2 million
improvement to operating income is predominantly attributable to
increased revenues; revenues for the company increased primarily due to
improved dayrates as well as fleet additions which occurred in 1995 and
in 1996. Average utilization for the year ended December 31, 1996 was
92% compared to 86% for the year ended December 31, 1995.
For the fourth quarter of 1996, the Company reported net income of
$26.0 million ($.36 net income per share) compared to net income of
$10.7 million ($.15 net income per share after preferred stock dividends
of $1.2 million) for the fourth quarter of 1995. Operating income for
the fourth quarter of 1996 was $38.3 million on revenues of $90.9 million
compared to operating income for the fourth quarter of 1995 of $13.6
million on revenues of $59.8 million. Again, this increase primarily
results from improved revenues from increased dayrates and fleet
additions. Utilization for the quarter ended December 31, 1996 was 92%
compared to 87% for the quarter ended December 31, 1995.
Paul B. Loyd, Jr. the Company's Chairman, President and CEO, said,
"1996 reflected a decisive improvement in results for Reading & Bates.
We are very pleased to report strong profits for the fourth quarter and
for the year. Several factors contributed to our success this year: a
robust market which saw significant increases in dayrates, a competitive
fleet made stronger by prudent capital investments during the year and a
solid financial structure with substantial operating leverage. Perhaps a
more pertinent exercise at this juncture, however, is to examine the
factors needed for continued success in this industry. Namely, the
capability to meet worldwide demand for high specification and deepwater
drilling services, the ability to reinvest responsibly the cash flows
generated in today's environment and the ability to maintain or improve
operating margins. We believe that Reading & Bates will continue to meet
these criteria for continued success. Specifically, Reading & Bates'
proven ability to develop key investment alternatives in its core high
specification drilling business, as well as its involvement in floating
production, field development, TOPS (which is RB's field development
joint venture), the Allegheny venture and other similar vehicles,
provides excellent reinvestment opportunities. Thus, we view our role as
a leader in an exciting and expanding market, and we look forward to
continued success measured both in terms of providing value to our
shareholders and providing an excellent product to the market."
Reading & Bates is a New York Stock Exchange listed company, engaging
in offshore drilling services throughout the world. Its wholly owned
subsidiary, Reading & Bates Development Co., provides technical,
construction and project management services, and floating production
systems to the upstream offshore oil and gas industry worldwide.
(financial highlights to follow)
READING & BATES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands except per share amounts)
THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
- -----------------------------------------------------------------------------
1996 1995 1996 1995
- -----------------------------------------------------------------------------
OPERATING REVENUES $ 90,920 $ 59,777 $ 290,223 $ 212,795
- -----------------------------------------------------------------------------
COSTS AND EXPENSES:
Operating expenses 35,871 33,422 126,708 127,070
Depreciation 9,592 7,770 33,584 30,369
General and administrative 7,184 5,018 22,579 17,139
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Total costs and expenses 52,647 46,210 182,871 174,578
- -----------------------------------------------------------------------------
OPERATING INCOME 38,273 13,567 107,352 38,217
- -----------------------------------------------------------------------------
OTHER INCOME (EXPENSE):
Interest expense, net of
capitalized interest (4,995) (3,606) (14,781) (15,303)
Interest income 651 429 2,185 1,832
Other, net (408) (1,054) (2,272) (2,008)
- -----------------------------------------------------------------------------
Total other income (expense) (4,752) (4,231) (14,868) (15,479)
- -----------------------------------------------------------------------------
INCOME BEFORE INCOME TAX EXPENSE,
MINORITY INTEREST AND
EXTRAORDINARY GAIN 33,521 9,336 92,484 22,738
INCOME TAX EXPENSE 4,515 1,285 7,884 2,824
MINORITY INTEREST (3,042) (822) (6,684) (1,522)
- -----------------------------------------------------------------------------
INCOME BEFORE EXTRAORDINARY GAIN 25,964 7,229 77,916 18,392
EXTRAORDINARY GAIN - 3,430 - 3,430
- -----------------------------------------------------------------------------
NET INCOME 25,964 10,659 77,916 21,822
DIVIDENDS ON PREFERRED STOCK - 1,213 3,631 4,855
- -----------------------------------------------------------------------------
NET INCOME APPLICABLE
TO COMMON STOCKHOLDERS $ 25,964 $ 9,446 $ 74,285 $ 16,967
=============================================================================
PRIMARY NET INCOME PER COMMON SHARE:
INCOME BEFORE
EXTRAORDINARY GAIN $ .36 $ .10 $ 1.15 $ .22
EXTRAORDINARY GAIN - .05 - .06
- -----------------------------------------------------------------------------
NET INCOME $ .36 $ .15 $ 1.15 $ .28
=============================================================================
FULLY DILUTED NET INCOME
PER COMMON SHARE $ - $ - $ 1.10 $ -
=============================================================================
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING:
PRIMARY 71,493 61,280 64,620 60,208
FULLY DILUTED - - 71,027 -
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(more)
READING & BATES CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands)
- --------------------------------------------------------------------------
12/31/96 12/31/95
- --------------------------------------------------------------------------
ASSETS:
Cash and cash equivalents $ 59,089 $ 36,171
Other current assets 81,001 59,617
Net property and equipment 657,629 505,605
Other assets 10,471 4,387
- --------------------------------------------------------------------------
TOTAL ASSETS $ 808,190 $ 605,780
==========================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities $ 55,132 $ 54,490
Long-term obligations 207,578 95,040
Other noncurrent liabilities 52,726 54,695
Minority interest 46,147 44,504
Stockholders' equity 446,607 357,051
- --------------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 808,190 $ 605,780
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