PAGE 1
================================================================================
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 MARCH 31, 1997
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:
281-492-2929
---------------
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
Number of outstanding shares of Common Stock, $1 par value, as of March 31,
1997: 6,740,763.
===============================================================================
<PAGE>
PAGE 2
PART I. FINANCIAL INFORMATION
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
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 to present fairly the financial position as of
March 31, 1997 and September 30, 1996, and the results of its operations for the
three months and six months ended March 31, 1997 and 1996, respectively, and the
statements of cash flows for the six months then ended. 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, 1996 Annual Report to Shareholders.
<PAGE>
PAGE 3
PART I. ITEM I - FINANCIAL STATEMENTS
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
March 31, September 30,
1997 1996
(In thousands)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 13,075 $ 17,565
Accounts receivable 15,404 16,687
Inventories of materials and supplies,
at lower of average cost or market 6,338 5,454
Deferred tax assets 1,510 1,510
Prepaid expenses 1,283 2,954
-------- --------
Total Current Assets 37,610 44,170
-------- --------
SECURITIES HELD FOR INVESTMENT:
Held to maturity, at amortized cost 22,579 22,576
Available-for-sale, at fair value 369 351
-------- --------
22,948 22,927
-------- --------
PROPERTY AND EQUIPMENT:
Drilling vessels, equipment and drill pipe 206,491 191,801
Other 5,044 4,810
-------- --------
211,535 196,611
Less-accumulated depreciation 109,860 105,487
-------- --------
Net Property and Equipment 101,675 91,124
-------- --------
DEFERRED COSTS AND OTHER ASSETS 741 1,088
-------- --------
$162,974 $159,309
======== ========
<FN>
The accompanying notes are an integral part of these consolidated
financial statements.
</FN>
</TABLE>
<PAGE>
PAGE 4
PART I. ITEM I - FINANCIAL STATEMENTS
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
March 31, September 30,
1997 1996
(In thousands)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Estimated current maturities
of long-term notes payable ........ $ 18,021 $ 7,933
Short-term note payable ............. 5,000 --
Accounts payable .................. 3,141 2,615
Accrued liabilities ................. 9,034 7,471
--------- ---------
Total Current Liabilities .. 35,196 18,019
--------- ---------
LONG-TERM NOTES PAYABLE,
net of estimated current maturities . 750 26,540
--------- ---------
DEFERRED CREDITS:
Income taxes ........................ 2,293 2,289
Other ............................... 11,518 6,907
--------- ---------
13,811 9,196
--------- ---------
SHAREHOLDERS' EQUITY:
Preferred stock, no par value;
1,000,000 shares authorized,
none outstanding ............... -- --
Common stock, $1 par value;
10,000,000 share authorized
with 6,740,000 and 6,691,000
shares issued and outstanding
as of March 31, 1997 and ....... 6,691
September 30, 1996, respectively 6,740 55,470
Paid-in capital ..................... 56,036 (139)
Net unrealized holding loss on
available-for-sale securities . (124) 43,532
---------
Retained earnings ................... 50,565
---------
Total Shareholders' Equity ..... 113,217 105,554
--------- ---------
$ 162,974 $ 159,309
<FN> ========= =========
The accompanying notes are an integral part of these consolidated
finanical statements.
</FN>
</TABLE>
<PAGE>
PAGE 5
PART I. ITEM I - FINANCIAL STATEMENTS
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
1997 1996 1997 1996
(In thousands except (In thousands except
per share amounts) per share amounts)
<S> <C> <C> <C> <C>
REVENUES:
Contract drilling $ 20,247 $ 18,878 $ 41,914 $ 36,821
Contract management 558 208 984 403
-------- -------- -------- --------
20,805 19,086 42,898 37,224
-------- -------- -------- --------
COSTS AND EXPENSES:
Contract drilling 11,767 12,901 24,173 25,789
Contract management 211 149 465 295
Depreciation 2,410 2,433 4,712 5,068
General and administrative 1,693 1,294 3,204 2,354
-------- -------- -------- --------
16,081 16,777 32,554 33,506
-------- -------- -------- --------
OPERATING INCOME 4,724 2,309 10,344 3,718
-------- -------- --------- --------
OTHER INCOME (EXPENSE)
Interest expense (199) (619) (731) (1,309)
Interest income 592 591 1,238 1,180
-------- -------- -------- --------
393 (28) 507 (129)
-------- -------- -------- --------
INCOME BEFORE INCOME TAXES 5,117 2,281 10,851 3,589
PROVISION FOR INCOME TAXES 2,003 950 3,818 1,596
-------- -------- -------- --------
NET INCOME $ 3,114 $ 1,331 $ 7,033 $ 1,993
======== ======== ======== ========
EARNINGS PER COMMON SHARE $ .46 $ .20 $ 1.04 $ .30
======== ======== ======== =========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 6,733 6,648 6,720 6,640
======== ======== ======== =========
<FN>
The accompanying notes are an integral part of these consolidated
finanical statements.
</FN>
</TABLE>
<PAGE>
PAGE 6
PART I. ITEM I - FINANCIAL STATEMENTS
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
March 31,
1997 1996
---- ----
<S> <C> <C>
(In thousands)
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income $ 7,033 $ 1,993
-------- --------
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation 4,712 5,068
Amortization of deferred costs 231 306
Changes in assets and liabilities:
Decrease (increase) in accounts receivable 1,283 (2,815)
Increase (decrease) in accounts payable 526 (3,215)
Increase in accrued liabilities 1,563 1,406
Deferred mobilization revenues 6,938 3,000
Other (1,566) 1,069
-------- --------
Total adjustments 13,687 4,819
-------- --------
Net cash provided by operating activities 20,720 6,812
-------- --------
CASH FLOW FROM INVESTING ACTIVITIES:
Capital expenditures (14,597) (1,336)
Investment in RIG-200 (526) (2,264)
-------- --------
Net cash used by investing activities (15,123) (3,600)
-------- --------
CASH FLOW FROM FINANCING ACTIVITIES:
Principal payments on long-term notes payable (15,702) (2,250)
Proceeds from exercises of stock options 615 518
Proceeds (payment) from/on short-term
note payable 5,000 (1,500)
-------- --------
Net cash used by financing activities (10,087) (3,232)
-------- --------
NET DECREASE IN CASH AND CASH EQUIVALENTS (4,490) (20)
CASH AND CASH EQUIVALENTS, at beginning of period 17,565 11,984
-------- --------
CASH AND CASH EQUIVALENTS, at end of period $ 13,075 $ 11,964
======== ========
Supplemental disclosure of cash flow information:
Cash paid during the period for
domestic and foreign income tax $ 2,369 $ 615
======== ========
Cash paid during the period for interest $ 852 $ 1,383
======== ========
<FN>
The accompanying notes are an integral part of these consolidated
financial statements.
</FN>
</TABLE>
<PAGE>
PAGE 7
PART I. ITEM I - FINANCIAL STATEMENTS
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. In January 1997, the Company executed a drilling contract for the
ATWOOD SOUTHERN CROSS which requires substantial refurbishment and
upgrade of the rig. The Company has previously committed to purchase $5
million of long-lead time equipment for such an upgrade and will incur
approximately $20 million of additional costs to complete the
refurbishment and upgrade. Management estimates that this rig will
commence drilling operations in Australia in late fiscal 1997 or early
fiscal 1998.
2. In conjunction with the upgrade of the ATWOOD HUNTER, the bank group
which holds a mortgage lien on the rig has provided a waiver of the
annual capital expenditures limit for fiscal 1997, along with some
other amendments to the loan documents, and the Company has reduced the
outstanding loan amount through a $10 million prepayment, in addition
to the quarterly and excess cash flow payment requirements. Since the
bank group debt matures in March 1998, the total outstanding balance of
$17.3 million has been included in current maturities of long-term
notes payable at March 31, 1997. In addition, the Company has agreed to
guaranty $3 million of the outstanding balance of such bank debt.
3. In December 1996, the Company increased its short-term line-of-credit
from a bank from $10 million to $30 million, secured by the pledge of
all of the Company's United States treasury bonds. At March 31, 1997,
$5 million was borrowed under this facility.
4. On February 4, 1997, the Company filed a Registration Statement on Form
S-3 with the Securities and Exchange Commission with respect to a
public offering by the Company of 1,500,000 shares of common stock.
However, in the opinion of management, the stock price range did not
adequately reflect the value of the Company, and therefore, the public
offering was subsequently withdrawn.
<PAGE>
PAGE 8
PART I. ITEM 2
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
This Form 10-Q includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical facts included in this Form 10-Q regarding the
Company's financial position, business strategy, budgets and plans and
objectives of management for future operations are forward-looking statements.
Although the Company believes that the expectations reflected in such
forward-looking statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Important factors that could cause
actual results to differ materially from the Company's expectations ("Cautionary
Statements") are disclosed in "Liquidity and Capital Resources" and elsewhere in
this Form 10-Q. All subsequent written and oral forward-looking statements
attributable to the Company, or persons acting on its behalf, are expressly
qualified in their entirety by the Cautionary Statements.
RESULTS OF OPERATIONS
Contract revenues increased $1.7 million and $5.7 million, respectively
for the three months and six months periods ended March 31, 1997 compared to the
same periods in fiscal 1996. The increase in revenues is primarily the result of
dayrate increases on several of the Company's mobile rigs. A comparative
analysis of contract revenues is as follows:
<TABLE>
<CAPTION>
CONTRACT REVENUES
---------------------------------------------------------
Three Months Ended Six Months Ended
---------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
March 31, March 31, Variance March 31, March 31, Variance
1997 1996 1997 1996
(In millions)
ATWOOD FALCON $4.1 $ 2.5 $1.6 $ 8.3 $ 5.0 $ 3.3
ATWOOD HUNTER 0.0 2.7 (2.7) 3.5 5.2 (1.7)
ATWOOD EAGLE 4.6 3.7 0.9 9.3 7.6 1.7
RIG-200 1.6 0.7 0.9 2.0 0.7 1.3
SEAHAWK 2.8 2.7 0.1 5.6 5.4 0.2
VICKSBURG 1.2 1.2 0.0 2.5 2.5 0.0
RIG-19 1.9 2.1 (0.2) 2.8 4.0 (1.2)
RICHMOND 2.2 1.5 0.7 4.2 2.8 1.4
GOODWYN 'A' 1.8 1.8 0.0 3.7 3.6 0.1
NORTH RANKIN 'A' 0.6 0.2 0.4 1.0 0.4 0.6
--- --- --- --- --- ---
$20.8 $19.1 $1.7 $42.9 $37.2 $5.7
===== ===== ==== ===== ===== ====
</TABLE>
The increase in revenues for the ATWOOD FALCON was due to an increase
of approximately 60% in the rig's contract dayrate during the quarter ended
September 30, 1996. The ATWOOD HUNTER completed its work in Malaysia in December
1996 and was mobilized to Singapore to undergo a substantial upgrade. The
Singapore portion of the upgrade has been completed, with the rig currently
being mobilized to the United States Gulf of Mexico. No income or expenses
associated with the ATWOOD HUNTER will be recognized while the upgrade and
relocation of the rig is in progress. During fiscal 1996, the ATWOOD EAGLE was
relocated from Australia to Equatorial Guinea with an approximate 25% increase
in contract dayrate. RIG-200 was installed on an offshore platform during
November and December 1996 and commenced drilling operations in January 1997.
Stable contracts for the SEAHAWK, VICKSBURG and GOODWYN 'A' continue to provide
consistency to these operations. The decline in RIG-19 revenues was due to the
rig being relocated to a new platform, which causes a reduction in revenues as
no revenues were recognized during the relocation period. The RICHMOND continues
to experience an increase in dayrate revenues. The increase in NORTH RANKIN 'A'
revenues was due to an increase in labor services provided to the rig.
Contract drilling and management costs decreased $1.1 million and $1.5
million, respectively for the three months and six months periods ended March
31, 1997 compared to the same periods in fiscal 1996. A comparative analysis of
contract drilling and management costs is as follows:
<PAGE>
PAGE 9
<TABLE>
<CAPTION>
CONTRACT DRILLING AND MANAGEMENT COSTS
----------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
---------------------------- -----------------------------
March 31, March 31, Variance March 31, March 31, Variance
1997 1996 1997 1996
(In millions)
<S> <C> <C> <C> <C> <C> <C>
ATWOOD FALCON $1.7 $1.7 $0.0 $3.4 $3.4 $0.0
ATWOOD HUNTER 0.0 1.8 (1.8) 1.9 3.6 (1.7)
ATWOOD EAGLE 2.4 2.5 (0.1) 4.9 5.4 (0.5)
RIG-200 0.6 0.0 0.6 0.6 0.0 0.6
SEAHAWK 1.7 1.7 0.0 3.4 3.3 0.1
VICKSBURG 0.9 0.7 0.2 1.7 1.5 0.2
RIG-19 1.5 1.6 (0.1) 2.3 3.0 (0.7)
RICHMOND 1.3 1.2 0.1 2.6 2.3 0.3
GOODWYN 'A' 1.5 1.4 0.1 3.0 2.8 0.2
NORTH RANKIN 'A' 0.2 0.1 0.1 0.4 0.2 0.2
OTHER 0.2 0.4 (0.2) 0.4 0.6 (0.2)
--- --- ---- --- --- ----
$12.0 $13.1 $(1.1) $24.6 $26.1 $1.5
===== ===== ===== ===== ===== ====
</TABLE>
The decrease in operating costs for the ATWOOD HUNTER is due to the
capitalization of costs associated with the rig during the upgrade and rig
relocation periods. The reduction in operating costs for the ATWOOD EAGLE was
attributed to the rig working in Equatorial Guinea where labor costs are lower
than in Australia. The increase in operating costs associated with RIG- 200 is
attributable to the fact that no operating costs were being incurred on RIG-200
prior to its commencement of drilling operation in Australia in January 1997.
The increases in operating costs for the SEAHAWK, RICHMOND, GOODWYN 'A' and
NORTH RANKIN 'A' were due primarily to increases in payroll related costs. The
relocation of RIG-19 to a new platform during the first quarter of fiscal 1997
accounted for its reduction in costs, as no costs were recognized during the
relocation period.
The current status of the Company's drilling contracts is as follows:
NAME OF RIG LOCATION CONTRACT STATUS AT MAY 14, 1997
ATWOOD Malaysia/ Estimated completion of current contract is November
FALCON Thailand 1997. Upon completion of the current drilling program,
Joint the rig will be mobilized to the Philippines to
commence drilling under a contract for two firm wells,
plus an option (which may be exercised on or before
June 30, 1997) for three years of drilling operations
in up to 3,500 feet of water in the Philippine South
China Sea.
ATWOOD Being Upon completion of mobilization and upgrade (estimated
HUNTER Mobilized July or August 1997) the rig will commence drilling
to the operation, in up to 3,500 feet of water under a three-
United year contract.
States Gulf
of Mexico
ATWOOD Equatorial Under contract until November 1997 with one six-month
EAGLE Guinea option.
SEAHAWK Malaysia Term contract (estimated completion September 1997).
VICKSBURG Australia Under contract until January 1998, subject
to early termination under certain circumstances.
RIG-19 Australia Term contract (estimated drilling work of between 9 and
12 months from January 1997).
RICHMOND United Under contract until May 1998 with one-six month
States option.
Gulf of
Mexico
<PAGE>
PAGE 10
ATWOOD Singapore The rig is currently in a shipyard in Singapore being
SOUTHERN refurbished and upgraded to operate in up to 2,000 feet
CROSS of water for a 175-day contract estimated to commence
in late fiscal 1997 or early fiscal 1998.
RIG-200 Australia Term contract (minimum duration of two years from
January 1997).
GOODWYN 'A'/ Australia Term contracts (estimated completion November 1997).
NORTH
RANKIN 'A'
An analysis of depreciation expense by rig is as follows:
<TABLE>
<CAPTION>
DEPRECIATION EXPENSE
-------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
---------------------------- -------------------------------
March 31, March 31, Variance March 31, March 31, Variance
1997 1996 1997 1996
(In millions)
<S> <C> <C> <C> <C> <C> <C>
ATWOOD FALCON $0.7 $0.7 $0.0 $1.4 $1.4 $0.0
ATWOOD HUNTER 0.0 0.4 (0.4) 0.3 0.8 (0.5)
ATWOOD EAGLE 0.5 0.5 0.0 1.0 1.0 0.0
RIG-200 0.4 0.0 0.4 0.4 0.0 0.4
SEAHAWK 0.6 0.5 0.1 1.1 1.1 0.0
VICKSBURG 0.0 0.0 0.0 0.0 0.0 0.0
RIG-19 0.0 0.1 (0.1) 0.1 0.4 (0.3)
RICHMOND 0.1 0.1 0.0 0.2 0.2 0.0
OTHER 0.1 0.1 0.0 0.2 0.2 0.0
---- ---- ---- ---- ---- ----
$2.4 $2.4 $0.0 $4.7 $5.1 $(0.4)
</TABLE>
The reduction in depreciation expense for the ATWOOD HUNTER was a
result of moving the rig into the shipyard in December 1996 for upgrade. While
undergoing upgrade, no depreciation expense will be recognized on the rig.
Depreciation of RIG-200 commenced with startup of its drilling operations in
January 1997.
The increase in general and administration expenses is primarily
attributable to increase in payroll related costs and professional fees, coupled
with costs incurred with respect to the filing of a Registration Statement on
Form S-3 with the Securities and Exchange Commission which was subsequently
withdrawn. As a result of a reduction in outstanding long-term debt, interest
expense declined. Due to an increase in profitability and a reduction in tax
attributes, provision for income taxes has increased.
LIQUIDITY AND CAPITAL RESOURCES
During the first six months of fiscal 1997, operating cash flow (before
changes in working capital and other assets and liabilities) increased 63% from
$7.4 million for the first six months of fiscal 1996 to $12.0 million. For the
six months ended March 31, 1997, the Company incurred approximately $15 million
of capital expenditures, primarily related to the upgrade of the ATWOOD HUNTER,
and reduced bank debt by approximately $11 million.
The first phase of the ATWOOD HUNTER upgrade has been completed, with
the rig currently being relocated from Southeast Asia to the United States Gulf
of Mexico. Upon arrival of the rig in the United States, the Company estimates
that it will take approximately eight weeks to complete the final upgrade
process, with a total upgrade cost of approximately $45 million, offset in part
by a $10 million mobilization fee of which $5.5 million has already been paid.
The ATWOOD SOUTHERN CROSS is in a Singapore shipyard undergoing an approximate
$25 million refurbishment and upgrade in order to achieve up to 2,000 feet water
depth drilling capability. In addition, if an option is exercised pursuant to a
contract for the ATWOOD FALCON, the Company will be required to upgrade the rig
to drill in up to 3,500 feet of water at an estimated cost of approximately $50
million. The Company is also evaluating the possible upgrade of the VICKSBURG,
which could cost in excess of $30 million.
<PAGE>
PAGE 11
At March 31, 1997, the Company continued to have approximately $22.6
million invested in United States treasury bonds with maturities in the year
2000 and 2001. The Company's portfolio of accounts receivables is comprised of
major international corporate entities with stable payment experience. Thus, the
Company continues to experience no difficulties in receivable collections.
The Company has a $30 million short-term line of credit with a bank
that is secured by a pledge of all the Company's United States treasury bonds.
At March 31, 1997, the Company had borrowed $5 million under this facility and
subsequent to March 31, 1997, the Company has borrowed an additional $10
million. Additional borrowings under this facility may be used to fund equipment
upgrades. In addition, at March 31, 1997, the Company has outstanding bank group
debt totalling $17.3 million, which matures in March 1998.
In February 1997, the Company filed a Registration Statement on Form
S-3 with the Securities and Exchange Commission with respect to a public
offering by the Company of 1,500,000 shares of common stock. However, in the
opinion of management, the stock price range did not adequately reflect the
value of the Company and therefore, the public offering was subsequently
withdrawn. The Company is currently pursuing the establishment of a $100 million
revolving credit facility to repay existing bank debt and to provide funding for
various planned capital expenditure projects. However, there is no assurance
that such debt financing is available on terms acceptable to the Company. The
Company will continue to monitor market conditions and to evaluate external
financing possibilities.
<PAGE>
PAGE 12
ATWOOD OCEANICS, INC. AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
The Company's Annual Meeting of Shareholders was held on February 13,
1997, at which the shareholders voted on the election of six directors (each to
serve a one year term); on a proposed amendment to the Company's Restated
Articles of Incorporation to increase the authorized common stock from
10,000,000 shares to 25,000,000 shares; on the proposed adoption of the Atwood
Oceanics, Inc. 1996 Incentive Equity Plan, and on a shareholder proposal.
1) Of the 5,350,169 shares of common stock present in person or
by proxy, the number of shares voted for or withheld in
connection with the election of each director are as follows:
NAME CAST FOR VOTES WITHHELD
----------------------- ---------- ----------------
Robert W. Burgess 5,005,439 346,020
George S. Dotson 5,003,239 350,420
Walter H. Helmerich III 5,004,929 347,040
Hans Helmerich 5,004,929 347,040
John R. Irwin 5,004,829 347,240
William J. Morrissey 5,005,439 346,020
2) Of the 6,710,413 shares of common stock outstanding on the
record date, the number of shares voted for, against and
abstaining with respect to the proposed amendment to the
Company's Restated Articles of Incorporation to increase the
authorized common stock from 10,000,000 shares to 25,000,000
shares was as follows:
SHARES VOTED FOR SHARES VOTED AGAINST SHARES ABSTAINED FROM
VOTING
----------------- -------------------- ----------------------
4,268,503 1,072,056 9,610
Approval of an amendment to the Company's Articles of Incorporation
requires the affirmative vote of holders of at least two-thirds of the
outstanding shares of record. Since only 63.6% of the shares of record
were voted for this proposal, the amendment was not approved.
3) The number of shares voted for, against and abstaining with
respect to the adoption of the Atwood Oceanics, Inc. 1996
Incentive Equity Plan was as follows:
SHARES VOTED FOR SHARES VOTED AGAINST SHARES ABSTAINED FROM
VOTING
---------------- --------------------- ----------------------
4,733,695 605,660 10,814
4) The number of shares voted for, against and abstaining with
respect to the shareholder proposal was as follows:
SHARES VOTED FOR SHARES VOTED AGAINST SHARES ABSTAINED FROM
VOTING
------------------ --------------------- -----------------------
601,629 4,686,016 62,524
<PAGE>
PAGE 13
Item 5. Other Information
May 13, 1997
TO OUR SHAREHOLDERS AND EMPLOYEES
The significant continuing improvement in fiscal 1997 financial results
compared to fiscal 1996 reflects the impact of increased dayrates realized by
the Company, primarily on the ATWOOD FALCON ("FALCON"), ATWOOD EAGLE ("EAGLE")
and RICHMOND. Even with no income contribution during the quarter from the
ATWOOD HUNTER ("HUNTER"), which is currently undergoing water-depth upgrade, net
income increased $1.8 million (134%) for the second quarter of fiscal 1997
compared to the second quarter of fiscal 1996. The first phase of the HUNTER
upgrade project has been completed in Singapore, and the rig is currently being
dry-transported to the Gulf of Mexico for completion of the water-depth upgrade.
Thereafter, the HUNTER will commence operations under a three-year deeper water
drilling program in the Gulf of Mexico.
The ATWOOD SOUTHERN CROSS ("SOUTHERN CROSS") is also now undergoing
water-depth upgrade in a Singapore shipyard after mobilization from Australia.
The SOUTHERN CROSS will commence operations under a 175-day contract in
Australia following upgrade. Future work for the SOUTHERN CROSS is already being
discussed with interested operators at favorable dayrates.
RIG-200 successfully commenced operations during the quarter and is
currently drilling its sixth well. The EAGLE's current contract has been
extended to November, 1997, and future work is under discussion at attractive
dayrates. The RICHMOND received a commitment to extend its contract to May, 1998
at a significantly higher dayrate. The VICKSBURG is being bid for ongoing and
upgrade opportunities commencing after its current contract commitment. Detailed
engineering relating to upgrade of the unit to extended-reach cantilever mode
has commenced.
World dayrates for semisubmersibles and jack-ups continued their upward
trend during the quarter. As a result, the upside potential for the Company from
contract expirations and upgrade opportunities remains positive.
During the quarter, an enhanced Safety Management System was introduced
throughout the Company's operations. I want to thank the Company's employees for
their many special contributions during the quarter and the Company's
shareholders for their continued support.
<PAGE>
PAGE 14
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Press Release dated March 7, 1997
(b) Reports on Form 8-K
None
<PAGE>
PAGE 15
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.
Date: May 14, 1997 By: s/JAMES M. HOLLAND
--------------------
James M. Holland
Senior Vice President
and Chief Accounting Officer
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PAGE 1
EXHIBIT INDEX
99.1 Press Release dated March 7, 1997
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EXHIBIT 99.1
HOUSTON, TEXAS
7 MARCH 1997
FOR IMMEDIATE RELEASE
ATWOOD OCEANICS, INC., HOUSTON-BASED INTERNATIONAL DRILLING CONTRACTOR,
ANNOUNCED TODAY THAT IT HAS WITHDRAWN ITS PUBLIC OFFERING OF 1.5 MILLION SHARES
OF COMMON STOCK. THE DECISION WAS BASED ON THE COMPANY'S BELIEF THAT THE RECENT
STOCK PRICE RANGE DOES NOT ADEQUATELY REFLECT THE VALUE OF THE COMPANY. THE
COMPANY BELIEVES IT HAS SUFFICIENT LIQUIDITY THROUGH CASH ON HAND, EXPECTED CASH
GENERATION AND BORROWINGS, IF NECESSARY, UNDER A NEW CREDIT FACILITY TO FINANCE
ITS NEAR-TO- INTERMEDIATE TERM CAPITAL REQUIREMENTS. THE COMPANY WILL CONTINUE
TO MONITOR MARKET CONDITIONS AND TO EVALUATE EXTERNAL FINANCING POSSIBILITIES,
AS APPROPRIATE.
CONTACT: JIM HOLLAND
(281) 492-2929
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