SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
________________
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTERLY PERIOD ENDED DECEMBER 31, 1994
COMMISSION FILE NUMBER 0-6352
ATWOOD OCEANICS, INC.
(Exact name of registrant as specified in its charter)
TEXAS 74-1611874
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
15835 Park Ten Place Drive 77084
Houston, Texas (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code:
713-492-2929
_______________
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 15 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months and (2) has been subject to such filings
requirements for the past 90 days. Yes X No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of December 31, 1994: 6,582,613 shares of Common Stock $1 par
value
PAGE 2
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
The condensed financial statements herein have been prepared by the
Company without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted,
although the Company believes that the disclosures are adequate to make the
information not misleading. The financial statements reflect all adjustments
which are, in the opinion of management, necessary for a fair statement of the
results for the quarters ended December 31, 1994 and 1993. All adjustments
were of a normal recurring nature. It is suggested these condensed financial
statements be read in conjunction with the financial statements and the notes
thereto included in the Company's September 30, 1994 Annual Report to
Shareholders.
PAGE 3
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I - ITEM I - FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
(Unaudited)
December 31, September 30,
1994 1994
(In thousands)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 18,656 $ 16,119
Accounts receivable 14,093 13,915
Current maturities of long-term notes
receivable 400 400
Inventories of materials and supplies, at
lower of average cost or market 4,219 4,194
Prepaid expenses and other 3,409 3,844
Total Current Assets 40,777 38,472
AVAILABLE FOR SALE SECURITIES 24,921 24,928
LONG-TERM NOTE RECEIVABLE, net of current
maturities 5,884 5,985
PROPERTY AND EQUIPMENT, at cost:
Drilling vessels, equipment and drill pipe 188,625 187,525
Other 4,793 4,479
193,418 192,004
Less - accumulated depreciation 112,624 109,159
Net Property and Equipment 80,794 82,845
DEFERRED COSTS AND OTHER ASSETS 1,322 1,230
$ 153,698 $ 153,460
</TABLE>
PAGE 4
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. ITEM I - FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
<TABLE>
(Unaudited)
December 31, September 30,
1994 1994
(In thousands)
<CAPTION>
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of notes payable by
partnership $ 3,000 $ 3,000
Accounts payable 3,597 3,728
Accrued liabilities 6,733 6,573
Total Current Liabilities 13,330 13,301
LONG-TERM NOTES PAYABLE BY PARTNERSHIP,
net of current maturities 50,210 50,294
DEFERRED CREDITS 2,282 2,289
MINORITY INTEREST IN PARTNERSHIPS 174 1,617
SHAREHOLDERS' EQUITY:
Preferred stock, no par value;
1,000,000 shares authorized, none
outstanding --- ---
Common stock, $1 par value;
10,000,000 shares authorized with
6,582,000 shares issued and
outstanding 6,582 6,582
Paid-in capital 54,273 54,273
Retained earnings 26,847 25,104
Total Shareholders' Equity 87,702 85,959
$ 153,698 $ 153,460
</TABLE>
PAGE 5
<TABLE>
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. ITEM I - FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Three Months Ended
December 31,
(In thousands, except per
share amounts)
1994 1993
<S> <C> <C>
REVENUES:
Drilling revenues $ 17,856 $ 15,373
management fee income 450 485
Dividends and interest 679 615
Gain on sale of Indian joint venture --- 201
18,985 16,674
COSTS AND EXPENSES:
Drilling costs 12,530 10,849
Depreciation 3,542 3,357
General and administrative 1,057 985
Interest 831 680
17,960 15,871
INCOME BEFORE MINORITY INTEREST AND
INCOME TAXES 1,025 803
MINORITY INTEREST IN LOSS OF PARTNERSHIPS 908 1,080
INCOME BEFORE INCOME TAXES 1,933 1,883
PROVISION FOR INCOME TAXES 190 283
NET INCOME $ 1,743 $ 1,600
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING 6,582 6,582
INCOME PER COMMON SHARE $ .26 $ .24
</TABLE>
PAGE 6
<TABLE>
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. ITEM I - FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF CASH FLOW
<CAPTION>
Three Months Ended
December 31,
1994 1993
(In thousands)
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income $ 1,743 $ 1,600
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation 3,542 3,357
Amortization of deferred items 103 62
Minority interest in net loss of
partnerships (908) (1,080)
Changes in assets and liabilities:
Increase in accounts receivable (178) (416)
Increase in accounts payable and accrued
liabilities 29 1,868
Other 315 (564)
Total adjustments 2,903 3,227
Net cash provided by operating
activities 4,646 4,827
CASH FLOW FROM INVESTING ACTIVITIES:
Capital expenditures (1,205) (1,989)
Proceeds from sale of equity in Indian joint
venture --- 1,300
Investment in joint venture (155) ---
Payments received on note receivable 101 101
Net cash used by investing activities (1,259) (588)
CASH FLOW FROM FINANCING ACTIVITIES:
Principal payment on long-term notes
payable (750) (750)
Net payments to limited partner (100) ---
Net cash used by financing activities (850) (750)
NET INCREASE IN CASH AND CASH EQUIVALENTS 2,537 3,489
CASH AND CASH EQUIVALENTS, at beginning of period 16,119 10,087
CASH AND CASH EQUIVALENTS, at end of period $ 18,656 $ 13,576
</TABLE>
PAGE 7
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Excluding the SOUTHERN CROSS, which has not been placed in service, thus
far in fiscal 1995, the Company has maintained 100 percent utilizations of its
equipment. In fact, since October 1993, the Company has incurred only eleven
idle equipment days, a 99.7 percent equipment utilization rate. However,
since the EAGLE, FALCON, RICHMOND and HUNTER have current contracts which
could expire in the second, third and fourth quarters of fiscal 1995,
respectively, there is no guarantee that the Company can maintain its current
level of equipment utilization for the remainder of fiscal 1995. The key to
the Company's return to profitability in 1994 and its level of profitability
thus far in fiscal 1995 has been high equipment utilization.
Total revenues increased $2.3 million (14 percent) and $1.4 million (8
percent) in the first quarter of fiscal year 1995 compared to the first and
fourth quarters of fiscal year 1994. The revenue increase in the first
quarter of fiscal 1995 from the first quarter of fiscal year 1994 is primarily
due to a $2.5 million (16 percent) increase in drilling revenues. A
comparative analysis of drilling revenues is as follows:
<TABLE>
QUARTERS ENDED
<CAPTION>
December 31, September 30, December 31,
1994 1994 1993
(In thousands)
<S> <C> <C> <C>
SEAHAWK $ 2,674 $ 2,690 $ 2,763
HUNTER 2,578 2,665 2,407
EAGLE 3,871 3,763 1,774
FALCON 2,771 2,551 3,546
VICKSBURG 1,164 1,167 1,027
RIG-19 1,901 1,649 1,683
RICHMOND 1,500 1,283 1,462
GOODWYN 'A' 1,159 --- ---
OTHER 238 295 711
$17,856 $16,063 $15,373
</TABLE>
Since its commencement of operation in February 1993, the SEAHAWK has
been a significant contributor to the Company's return to profitability. The
HUNTER has experienced 100 percent utilization since April 1993. During
December 1993, the EAGLE was mobilized from Malaysia to the "Zone of
Cooperation" (an area jointly governed by Indonesia and Australia) and since
being relocated has experienced 100 percent utilization. The downtime
incurred in relocating the EAGLE accounts for drilling revenues for the first
quarter of fiscal year 1995 being significantly higher than the first quarter
of fiscal year 1994. The reduction in drilling revenues for the FALCON in the
first quarter of fiscal year 1995 compared to the first quarter of fiscal 1994
is due to the rig operating in Korea where dayrate levels are lower compared<PAGE>
PAGE 8
to Australia due to lower operating costs. In September 1994, RIG-19 was
relocated to a new platform and received an increase in dayrate revenue which
accounts for its increase in drilling revenues. The RICHMOND has worked
continuously since March 1993. In October 1994, the Australian operator-owned
GOODWYN 'A' platform rig commenced drilling operations. Since July 1989, the
Company, on a management fee basis, directed the design, construction and
offshore commissioning of the GOODWYN 'A' drilling facilities. The Company
now has responsibility for the operations and maintenance of these facilities
and is compensated on a dayrate basis. The Company's current contract status
for its drilling operations is as follows:
NAME OF RIG LOCATION CONTRACT STATUS
SEAHAWK Malaysia Term contract (estimated completion 1997).
HUNTER Malaysia Drilling the 28th of 30 firm wells (with
eight option wells).
EAGLE Australia/Indonesia Drilling the third of possible seven
"Zone of option wells (if no additional option
Cooperation" wells are drilled, contract could be
complete before the end of March 1995).
FALCON Korea Preparing to be relocated to China to
commence a short drilling program which
could be completed by the end of June
1995.
VICKSBURG Australia Under contract until February 1996 (with
two one year options).
RIG-19 Australia Term contract (estimated completion 1997).
RICHMOND United States Short term contract which could be
completed by the end of June 1995.
GOODWYN 'A' Australia Term contract (estimated completion 1997).
For the three months ended December 31, 1994 compared to the three
months ended December 31, 1993, drilling costs increased $1.6 million or 15
percent. An analysis of drilling costs by rigs is as follows:
QUARTERS ENDED
December 31, September 30, December 31,
1994 1994 1993
(In thousands)
SEAHAWK $ 1,544 $ 1,584 $ 1,538
HUNTER 1,930 1,754 1,691
EAGLE 3,008 3,029 1,539
FALCON 1,747 1,293 2,819
VICKSBURG 721 664 201
RIG-19 1,183 806 1,151
RICHMOND 941 964 882
GOODWYN 'A' 896 --- ---
OTHER 560 1,132 1,028
$ 12,530 $ 11,226 $ 10,849
PAGE 9
The EAGLE's relocation from Malaysia to the "Zone of Cooperation" where
operating costs are higher due to increased labor costs accounts for the
significant increase in drilling costs in the fourth quarter of fiscal year
1994 and the first quarter of fiscal year 1995 compared to the first quarter
of fiscal year 1994. On the other hand, the relocation of the FALCON out of
Australia accounts for its significant reduction in drilling costs. During
the first quarter of fiscal 1994, the VICKSBURG was credited with
approximately $500,000 in personnel tax refunds which accounts for its reduced
drilling costs during that period. Drilling costs for RIG-19 was lower during
the quarter ended September 30, 1994 due to the rig being relocated to a new
platform. As previously stated, drilling operations commenced on the GOODWYN
'A' platform rig in October 1994 whereby the Company has labor responsibility
and is being compensated on a dayrate revenue basis.
LIQUIDITY AND CAPITAL RESOURCES
Fabrication work has commenced on RIG-200 (the state-of-the-art modular
platform rig jointly owned by the Company and Helmerich & Payne, Inc.). At
December 31, 1994, the Company had only invested approximately $500,000 in the
RIG-200 project; however, based upon the current construction schedule, the
Company will invest an additional $12 million in this project during 1995.
The SOUTHERN CROSS remains idle in Australia as the Company pursues future
contract opportunities. Before the unit can be placed into service, an
additional capital investment, which could be as high as $30 million, will be
required. In addition to pursing a contract opportunity for the SOUTHERN
CROSS, the Company is also pursuing other expansion
opportunities. The Company currently plans to fund the RIG-200 investment
from internally generated funds; however, should the Company receive a
contract for the SOUTHERN CROSS or receive a commitment on another expansion
opportunity, funding of these additional investment opportunities will
probably require the use of a short-term borrowing facility.
During the quarter, the Company's working capital increased
approximately $2.3 million. The Company continues to experience no
difficulties in collecting its accounts receivables. If the Company can
continue to maintain its high level of equipment utilization, cash flow from
operations should continue to remain at approximately $4 million per quarter
for the remainder of fiscal 1995. However, if equipment utilization declines,
cash flow will likewise decline. The Company will continue its emphasis on
maintaining a high level of equipment utilization.
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART I. ITEM 2
TO OUR SHAREHOLDERS AND EMPLOYEES:
The results for the first quarter of fiscal 1995 reflect the Company's
best quarterly performance since the last quarter of fiscal year 1983.
Excluding the SOUTHERN CROSS, which has not been placed in service, the
Company has maintained 100 percent utilization of its equipment since December
1993. Earnings, including investment income, before depreciation, interest
and taxes, but after adjustment for minority interest, were $4.1 million for
PAGE 10
the first quarter of fiscal year 1995 compared to $3.8 million for the first
quarter of fiscal year 1994. Compared to the first quarter of fiscal 1994,
operating cash flow for the first quarter of fiscal 1995 increased from $3.9
million to $4.4 million.
The key to the Company maintaining its current level of profitability
remains high equipment utilization. The FALCON will complete its current
contract in Korea in February 1995 and then be relocated to China to commence
a short-term drilling program which should keep the rig committed into the
third quarter of fiscal 1995. If option wells are not drilled, the EAGLE
could complete its current drilling program before the end of March 1995. The
RICHMOND and HUNTER could complete their current contract commitments in the
third and fourth quarters of fiscal 1995, respectively. The VICKSBURG has a
contract commitment into 1996, and RIG-19 and the SEAHAWK are committed into
1997. The Company continues to aggressively pursue ongoing employment
opportunities for the three semisubmersibles and the RICHMOND. Maintaining
high equipment utilization will continue to be a challenge; however, through
fiscal 1994 and thus far through fiscal 1995, the Company has successfully
faced this challenge with a 99.7 percent equipment utilization rate.
We are pleased to announce that in late October 1994, drilling
operations commenced on the Australian operator-owned GOODWYN 'A' platform
rig. Since July 1989, the Company, on a management fee basis, has directed
the design, equipment procurement, fabrication, transport and offshore
commissioning of the GOODWYN 'A' drilling facilities. The operation and
maintenance phase of this project will provide additional enhancements to
financial performance. Fabrication work has commenced on RIG-200 (the state-
of-the-art modular platform rig jointly owned by the Company and Helmerich &
Payne, Inc.), with operation in Australia currently scheduled to commence in
late 1996. We are continuing our efforts in pursuing additional new
opportunities which could further enhance our future operating results.
The offshore drilling and service industry continues to change and
remains very competitive. We are committed to achieving higher standards of
excellence in safety and operational performance and to better understand our
clients' present and future service needs. Our goal is to provide superior
services and value to our clients. As we strive for continuation of
profitability and growth, we appreciate the support and commitment of our
employees and shareholders.
s/ John R. Irwin
JOHN R. IRWIN
PRESIDENT
PAGE 11
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART II. OTHER INFORMATION
During the quarter ended December 31, 1994, the Company has not filed
any Form 8-K's.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ATWOOD OCEANICS, INC.
(Registrant)
Date: 2/14/94 s/ James M. Holland
JAMES M. HOLLAND
Senior Vice President
and Chief Accounting Officer
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000008411
<NAME> ATWOOD OCEANICS, INC.
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> QTR-1 QTR-1
<FISCAL-YEAR-END> SEP-30-1995 SEP-30-1994
<PERIOD-START> OCT-01-1994 OCT-01-1993
<PERIOD-END> DEC-31-1994 DEC-31-1993
<CASH> 18,656 13,576
<SECURITIES> 24,921 24,949
<RECEIVABLES> 20,377 17,872
<ALLOWANCES> 0 0
<INVENTORY> 4,219 3,971
<CURRENT-ASSETS> 40,777 31,226
<PP&E> 193,418 188,476
<DEPRECIATION> 112,624 99,668
<TOTAL-ASSETS> 153,698 152,299
<CURRENT-LIABILITIES> 13,330 13,768
<BONDS> 50,210 54,845
<COMMON> 6,582 6,582
0 0
0 0
<OTHER-SE> 54,273 54,273
<TOTAL-LIABILITY-AND-EQUITY> 153,698 152,299
<SALES> 18,306 15,858
<TOTAL-REVENUES> 18,985 16,674
<CGS> 13,587 11,834
<TOTAL-COSTS> 13,587 11,834
<OTHER-EXPENSES> 3,542 3,357
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 831 680
<INCOME-PRETAX> 1,933 1,883
<INCOME-TAX> 190 283
<INCOME-CONTINUING> 1,743 1,600
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,743 1,600
<EPS-PRIMARY> .26 .24
<EPS-DILUTED> .26 .24
</TABLE>
