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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): January 13, 2000
ROWAN COMPANIES, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 1-5491 75-0759420
(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
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2800 POST OAK BOULEVARD, SUITE 5450, HOUSTON, TEXAS 77056-6196
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 621-7800
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ITEM 5. OTHER EVENTS
Press Releases. The information set forth in the press releases of the
registrant dated January 13, 2000, January 31, 2000 and February 7, 2000, which
are filed as exhibits hereto, is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits:
Exhibit No. Description
- ----------- -----------
99.1 Press release, dated January 13, 2000.
99.2 Press release, dated January 31, 2000.
99.3 Press release, dated February 7, 2000.
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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 by the
undersigned thereunto duly authorized.
ROWAN COMPANIES, INC.
(Registrant)
By: /s/ E. E. THIELE
---------------------------------
E. E. Thiele
Principal Financial Officer
Date: February 14, 2000
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INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
99.1 Press release, dated January 13, 2000.
99.2 Press release, dated January 31, 2000.
99.3 Press release, dated February 7, 2000.
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EXHIBIT 99.1
ROWAN REPORTS IMPROVED FINANCIAL RESULTS
HOUSTON, Jan 13, 2000 /PRNewswire via COMTEX/ -- Net income amounted to $2.4
million, or $.03 per share, in the fourth quarter of 1999 compared to $0.6
million, or $.01 per share, in the third quarter of 1999. Net income was $4.8
million, or $.06 per share, in the fourth quarter of 1998. For the year ended
December 31, 1999, the Company incurred a net loss of $9.7 million, or $.12 per
share, compared to net income of $124.5 million, or $1.43 per share, in 1998.
The improvement in results between the third and fourth quarters of 1999 was
largely due to the contribution of the drilling division. Results for the fourth
quarter were negatively impacted by mobilization expense of approximately $3.9
million, or about $.03 per share, to relocate Gorilla V and the Rowan-Halifax
from the North Sea to eastern Canada and the Gulf of Mexico, respectively.
Additionally, the Gorilla V contract dispute with Amoco (UK) Exploration Company
reduced quarterly revenues and pre-tax income by approximately $16 million.
C. R. Palmer, Chairman and Chief Executive Officer, commented, "What a
difference a year makes. At this time last year, our offshore rig utilization
was 36% and our average day rate was $67,900 and declining. Currently, our rig
utilization is 91% and our average day rate is $41,200 and increasing.
Fortunately, Rowan's stock price clearly reflects the improving business outlook
- -- near $21.00 per share today, up from less than $11.00 a year ago.
"Demand for energy is increasing and energy prices have stabilized -- at least
for the moment. The fundamentals are in place for continued improvement in
financial performance.
"We believe we are in the right places, with the right equipment and personnel.
Go RDC!"
Rowan Companies, Inc. (NYSE: RDC) is a major provider of international and
domestic offshore contract drilling and aviation services. The Company also
operates a mini-steel mill, a manufacturing facility that produces heavy
equipment for the mining, timber and transportation industries, and a marine
division that has designed and built over one-third of all mobile offshore
jack-up drilling rigs, including all 21 operated by the Company. The Company's
stock is traded on the New York Stock Exchange and the Pacific Stock Exchange.
Common Stock trading symbol: RDC.
Contact: William C. Provine, Vice-President - Investor Relations, 713-960-7575.
Website: www.rowancompanies.com.
This report contains forward looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
statements as to the expectations, beliefs and future expected financial
performance of the Company that are based on current expectations and are
subject to certain risks, trends and uncertainties that could cause actual
results to differ materially from those projected by the Company. Among the
factors that could cause actual results to differ materially include oil and
natural gas prices, the level of offshore expenditures by energy companies, the
general economy, including inflation, weather conditions in the Company's
principal operating areas and environmental and other laws and regulations.
Other relevant factors have been disclosed in the Company's filings with the
U.S. Securities and Exchange Commission.
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ROWAN COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
Unaudited (In Thousands)
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<CAPTION>
DECEMBER 31
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ASSETS 1999 1998
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Cash and short-term investments .......................................... $ 87,055 $ 148,834
Accounts receivable....................................................... 93,083 81,097
Inventories............................................................... 120,456 113,916
Other current assets...................................................... 24,481 21,805
------- ----------
Total current assets............................................... 325,075 365,652
Property, plant and equipment - net....................................... 1,025,739 877,197
Other assets.............................................................. 5,253 6,259
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TOTAL.............................................................. $1,356,067 $1,249,108
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current maturities of long-term debt...................................... $ 129,123 $ 12,756
Other current liabilities................................................. 73,160 66,837
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Total current liabilities.......................................... 202,283 79,593
Long-term debt............................................................ 296,677 310,250
Other liabilities......................................................... 133,383 129,269
Stockholders' equity...................................................... 723,724 729,996
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TOTAL.............................................................. $1,356,067 $1,249,108
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CONSOLIDATED STATEMENT OF OPERATIONS
Unaudited (In Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE TWELVE MONTHS
ENDED DECEMBER 31 ENDED DECEMBER 31
---------------------- --------------------
1999 1998 1999 1998
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<S> <C> <C> <C> <C>
REVENUES:
Drilling services................................... $ 71,269 $ 72,472 $260,939 $431,664
Manufacturing sales and services.................... 25,892 39,482 95,545 158,913
Aviation services................................... 24,256 22,772 104,078 115,773
-------- -------- -------- -------
TOTAL.......................................... 121,417 134,726 460,562 706,350
-------- -------- -------- -------
COSTS AND EXPENSES:
Drilling services................................... 53,558 57,388 214,230 219,628
Manufacturing sales and services.................... 22,060 32,411 88,431 134,542
Aviation services................................... 22,841 23,379 94,413 101,899
Depreciation and amortization....................... 13,843 12,856 54,699 49,703
General and administrative.......................... 4,338 4,721 18,399 18,366
-------- -------- -------- --------
TOTAL.......................................... 116,640 130,755 470,172 524,138
-------- -------- -------- --------
INCOME (LOSS) FROM OPERATIONS....................... 4,777 3,971 (9,610) 182,212
-------- -------- -------- --------
OTHER INCOME (EXPENSE):
Interest expense.................................... (6,698) (4,747) (22,755) (17,500)
Less interest capitalized........................... 3,684 4,582 11,238 16,264
Gain on disposals of property, plant 2,059 1,482 5,125
and equipment.................................. 458
Interest income..................................... 1,018 2,026 4,583 7,205
Other - net 50 119 526 395
-------- -------- -------- --------
OTHER INCOME (EXPENSE) - NET................... (1,488) 4,039 (4,926) 11,489
-------- -------- -------- --------
INCOME (LOSS) BEFORE INCOME TAXES:.................. 3,289 8,010 (14,536) 193,701
Provision (credit) for income taxes............ 932 3,193 (4,870) 69,241
-------- -------- -------- --------
NET INCOME (LOSS)................................... $ 2,357 $ 4,817 $ (9,666) $124,460
======== ======== ======== ========
EARNINGS (LOS) PER COMMON SHARE:
Basic............................................... $ .03 $ .06 $ (.12) $ 1.45
======== ======== ======== ========
Diluted............................................. $ .03 $ .06 $ (.12) $ 1.43
======== ======== ======== ========
DILUTED SHARES...................................... 84,764 84,617 84,455 87,289
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ROWAN COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited (In Thousands)
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<CAPTION>
FOR THE TWELVE MONTHS
ENDED DECEMBER 31
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1999 1998
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<S> <C> <C>
CASH PROVIDED BY (USED IN):
Operations:
Net income (loss)................................................ $ (9,666) $124,460
Adjustments to reconcile net income (loss) to net cash
provided by operations:
Depreciation and amortization............................... 54,699 49,703
Deferred income taxes....................................... (4,419) 49,781
Other - net................................................. 4,427 235
Net changes in current assets and liabilities.................... (7,791) 23,252
Net changes in other noncurrent assets and liabilities........... 656 262
-------- --------
Net cash provided by operations...................................... 37,906 247,693
-------- --------
Investing activities:
Property, plant and equipment additions.......................... (204,698) (247,747)
Proceeds from disposals of property, plant and equipment......... 3,160 8,090
Proceeds from disposition of investment in 49% owned
company..................................................... -- 19,550
Net cash used in investing activities................................ (201,529) (220,107)
-------- --------
Financing activities:
Proceeds from borrowings......................................... 115,550 103,012
Repayments of borrowings......................................... (12,756) (36,156)
Payments to acquire treasury stock............................... (2,258) (55,638)
Other - net...................................................... 1,308 1,698
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Net cash provided by financing activities............................ 101,844 12,916
-------- --------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS.......................... (61,779) 40,502
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD............................ 148,832 108,332
-------- --------
CASH AND CASH EQUIVALENTS, END OF PERIOD.................................. $ 87,055 $148,834
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EXHIBIT 99.2
ROWAN COMPANIES, INC. COMPLETES PURCHASE OF THE ELLIS WILLIAMS
COMPANY, INC.
HOUSTON, Jan 31, 2000 -- Rowan Companies, Inc. (NYSE: RDC) announced today that
LeTourneau, Inc., a wholly owned subsidiary, has completed the purchase of The
Ellis Williams Company, Inc. and EWCO, Inc. dba Traitex Machine Co., which
design and manufacture mud pumps ranging in capacity from 350 to 2200 HP.
The purchase price was approximately $9 million, $6 million in cash and the
balance in promissory notes due over a three-year period. Rowan expects the new
company, LeTourneau Ellis Williams Company, Inc., will generate first year
revenues in the range of $9 to $12 million, and that operations for the first
quarter of 2000 will be profitable.
C. R. Palmer, Chairman and CEO commented, "We view the acquisition of The Ellis
Williams Company as a 'bolt-on' addition to our manufacturing division. We
believe the acquisition will increase the profitability of LeTourneau, broaden
the customer base, and expand the product line.
"We anticipate utilizing LeTourneau's manufacturing facility in Longview, Texas
to add capacity and decrease delivery times for certain lines of EWCO pumps. In
addition, we expect to consolidate the Ellis Williams operations, presently
conducted at two Houston area locations, in a larger Houston area plant with
increased capacity. Our goal is to increase pump deliveries by a factor of three
by the year 2003.
"We are particularly pleased that the founder, Ellis Williams, Jr., has agreed
to remain as a design consultant, and Michael R. Williams, formerly President of
The Ellis Williams Company, has agreed to remain in the new LeTourneau
subsidiary as Senior Vice President and General Manager. Each will contribute to
improving the existing pump line and will provide guidance and direction in the
development of additional pump designs."
Rowan Companies, Inc. is a major provider of international and domestic offshore
contract drilling and aviation services. The Company also operates a mini-steel
mill, a manufacturing facility that produces heavy equipment for the mining,
timber and transportation industries, and a marine division that has designed
and built over one-third of all mobile offshore jack-up drilling rigs, including
all 21 operated by the Company. The Company's stock is traded on the New York
Stock Exchange and the Pacific Stock Exchange. Common Stock trading symbol: RDC.
Contact: William C. Provine, Vice-President - Investor Relations, 713-960-7575.
Website: www.rowancompanies.com
This report contains forward looking statements within the meaning of the
Private Securities Litigation Reform Act OF 1995, including, without limitation,
statements as to the expectations, beliefs and future expected financial
performance of the Company that are based on current expectations and are
subject to certain risks, trends and uncertainties that could cause actual
results to differ materially from those projected by the Company. Among the
factors that could cause actual
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results to differ materially include oil and natural gas prices, the level of
offshore expenditures by energy companies, the general economy, including
inflation, weather conditions in the Company's principal operating areas and
environmental and other laws and regulations. Other relevant factors have been
disclosed in the Company's filings with the U.S. Securities and Exchange
Commission.
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EXHIBIT 99.3
ROWAN COMPANIES, INC. ANNOUNCES RELOCATION OF TWO RIGS
HOUSTON, Feb 7, 2000 /PRNewswire via COMTEX/ -- Rowan Companies, Inc. (NYSE:
RDC) announced that the jack-ups, "Arch Rowan" and "Gorilla IV", will be
relocated from the North Sea to the Gulf of Mexico.
C. R. Palmer, Chairman and Chief Executive Officer, commented, "Once again the
mobility of our drilling assets permits us to depart a declining market for
greener pastures. We continue to be optimistic, longer term, for the North Sea
drilling market, particularly for our Super Gorilla designs, but for the moment
we must accept the reality of the marketplace and move on."
Rowan Companies, Inc. is a major provider of international and domestic offshore
contract drilling and aviation services. The Company also operates a mini-steel
mill, a manufacturing facility that produces heavy equipment for the mining,
timber and transportation industries, and a marine division that has designed
and built over one-third of all mobile offshore jack-up drilling rigs, including
all 21 operated by the Company. The Company's stock is traded on the New York
Stock Exchange and the Pacific Stock Exchange.
Common Stock trading symbol: RDC.
Contact: William C. Provine, Vice-President - Investor Relations, 713-960-7575.
Website: www.rowancompanies.com
This report contains forward looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
statements as to the expectations, beliefs and future expected financial
performance of the Company that are based on current expectations and are
subject to certain risks, trends and uncertainties that could cause actual
results to differ materially from those projected by the Company. Among the
factors that could cause actual results to differ materially include oil and
natural gas prices, the level of offshore expenditures by energy companies, the
general economy, including inflation, weather conditions in the Company's
principal operating areas and environmental and other laws and regulations.
Other relevant factors have been disclosed in the Company's filings with the U.
S. Securities and Exchange Commission.
