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Source: Vantage Drilling International

Vantage Drilling International Reports Fourth Quarter and Full-Year 2019 Results

HOUSTON, March 05, 2020 (GLOBE NEWSWIRE) -- Vantage Drilling International ("Vantage" or the “Company”) reported a net loss attributable to controlling interest of approximately $61.4 million or $8.22 per diluted share for the three months ended December 31, 2019, based on the weighted average shares outstanding after the conversion of our convertible notes, as compared to a net loss attributable to controlling interest of $52.2 million or $10.44 per diluted share for the three months ended December 31, 2018.

For the year ended December 31, 2019, Vantage reported net income attributable to controlling interest of approximately $455.7 million or $80.27 per diluted share, as compared to a net loss attributable to controlling interest of $141.5 million or $28.29 per diluted share for the year ended December 31, 2018.

As of December 31, 2019, Vantage had approximately $242.9 million in cash, including $11.0 million of restricted cash, compared to $239.4 million in cash, including$14.4 million of restricted cash at December 31, 2018. The Company generated $535.6 million in cash from operations, including cash collected in the Petrobras settlement in 2019 compared to $12.8 million generated in 2018. During the three months ended December 31, 2019, the Company made a special cash distribution of $525.0 million to shareholders.

Ihab Toma, CEO, commented, “I am pleased to report that we were able to return value to our shareholders through the issuance of a special cash distribution of approximately $525.0 million during the quarter and with the conversion of our convertible debt to equity in the fourth quarter, we enhanced our industry leading balance sheet while retaining significant debt coverage. Separately, I am pleased to report that we continue to achieve operational excellence, recording approximately 100% revenue efficiency for the quarter. Our continued focus on increased efficiency and maintaining an optimized cost structure position us to benefit from the improved conditions in the jack-up market and the improving conditions in the drillship space.”

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with a fleet of three ultra-deepwater drillships and five premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells globally for major, national and independent oil and natural gas companies. Vantage also provides construction supervision services and preservation management services for, and will operate and manage, drilling units owned by others.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the company's filings with the Securities and Exchange Commission. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements. Vantage disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Public & Investor Relations Contact:

     Thomas J. Cimino
     Chief Financial Officer
     Vantage Drilling International
     (281) 404-4700



Vantage Drilling International
Consolidated Statement of Operations
(In thousands, except per share data)
(Unaudited)
 
 Three Months Ended December 31,  Year Ended December 31,
  2019   2018   2019   2018 
Revenue       
Contract drilling services$42,996  $37,753  $144,571  $203,565 
Contract termination revenue —   —   594,029   — 
Reimbursables and other 6,270   5,314   22,248   22,182 
Total revenue 49,266   43,067   760,848   225,747 
Operating costs and expenses       
Operating costs 42,355   42,099   156,893   171,041 
General and administrative 42,534   6,609   128,548   29,544 
Depreciation 18,329   17,230   73,820   70,447 
Total operating costs and expenses 103,218   65,938   359,261   271,032 
Income (loss) from operations (53,952)  (22,871)  401,587   (45,285)
Other income (expense)       
Interest income 2,754   924   116,368   1,898 
Interest expense and other financing charges (9,860)  (20,657)  (46,575)  (78,779)
Loss on debt extinguishment —   (1,271)  —   (1,271)
Other, net (5)  (474)  216   (1,505)
Total other expense (7,111)  (21,478)  70,009   (79,657)
Income (loss) before income taxes (61,063)  (44,349)  471,596   (124,942)
Income tax provision (731)  7,828   15,121   16,526 
Net income (loss) (60,332)  (52,177)  456,475   (141,468)
Net income attributable to noncontrolling interests 1,053   —   741   — 
Net income (loss) attributable to shareholders$(61,385) $(52,177) $455,734  $(141,468)
Earnings (loss) per share, Basic and Diluted$(8.22) $(10.44) $80.27  $(28.29)
Weighted average successor ordinary shares outstanding, Basic and Diluted 7,470   5,000   5,677   5,000 
        
Vantage Drilling International
Supplemental Operating Data
(Unaudited, in thousands, except percentages)
 Three Months Ended December 31,  Year Ended December 31,
  2019   2018   2019   2018 
Operating costs and expenses       
Jackups$15,685  $16,396  $62,448  $65,492 
Deepwater 19,775   20,217   70,184   79,655 
Operations support 4,064   2,274   13,538   12,888 
Reimbursables 2,831   3,212   10,723   13,006 
 $42,355  $42,099  $156,893  $171,041 
        
Utilization       
Jackups 99.1%   96.6%   97.4%   92.2% 
Deepwater 61.1%   35.0%   46.1%   54.5% 



Vantage Drilling International
Consolidated Balance Sheet
(In thousands, except share and par value information)
(Unaudited)
    
 December 31,
2019		 December 31,
2018
    
ASSETS   
Current assets   
Cash and cash equivalents$231,947  $224,967 
Restricted cash 2,511   10,362 
Trade receivables 46,504   28,431 
Inventory 48,368   45,195 
Prepaid expenses and other current assets 16,507   17,278 
Total current assets 345,837   326,233 
Property and equipment   
Property and equipment 1,002,968   996,139 
Accumulated depreciation (281,842)  (208,836)
Property and equipment, net 721,126   787,303 
Operating lease ROU assets 6,706   — 
Other assets 17,068   16,026 
Total assets$1,090,737  $1,129,562 
    
LIABILITIES AND SHAREHOLDERS' EQUITY   
Current liabilities   
Accounts payable$49,599  $44,372 
Other current liabilities 26,936   17,983 
Total current liabilities 76,535   62,355 
Long–term debt, net of discount and financing costs of $6,421 and $12.914 343,579   1,109,011 
Other long-term liabilities 17,532   22,889 
Commitments and contingencies   
Shareholders' equity   
Ordinary shares, $0.001 par value, 50 million shares authorized; 13,115,026 and 5,000,053 shares issued and outstanding, respectively 13   5 
Additional paid-in capital 634,770   373,972 
Accumulated earnings (deficit) 17,064   (438,670)
Controlling interest shareholders' equity 651,847   (64,693)
Noncontrolling interests 1,244   — 
Total equity 653,091   (64,693)
Total liabilities and shareholders’ equity$1,090,737  $1,129,562 


Vantage Drilling International
Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
    
 Year Ended December 31,
  2019   2018 
CASH FLOWS FROM OPERATING ACTIVITIES   
Net income (loss)$456,475  $(141,468)
Adjustments to reconcile net income (loss) to net cash provided by operating activities   
Depreciation expense 73,820   70,447 
Amortization of debt financing costs 1,627   556 
Amortization of debt discount 5,354   49,417 
Amortization of contract value 1,643   6,311 
PIK interest on the Convertible Notes 7,132   7,648 
Share-based compensation expense 957   7,165 
Non-cash loss on debt extinguishment —   975 
Deferred income tax (benefit) expense (51)  1,742 
(Gain) loss on disposal of assets 155   (1,301)
Changes in operating assets and liabilities:   
Trade receivables (18,073)  16,948 
Inventory (3,174)  1,911 
Prepaid expenses and other current assets 771   (6,121)
Other assets 4,265   2,339 
Accounts payable 5,227   4,706 
Other current liabilities and other long-term liabilities (489)  (8,481)
Net cash provided by operating activities 535,639   12,794 
CASH FLOWS FROM INVESTING ACTIVITIES   
Additions to property and equipment (7,798)  (14,316)
Cash paid for Soehanah acquisition —   (85,000)
Net proceeds from sale of Vantage 260 —   4,703 
Net cash used in investing activities (7,798)  (94,613)
CASH FLOWS FROM FINANCING ACTIVITIES   
Repayment of long-term debt —   (216,265)
Proceeds from issuance of 9.25% First Lien Notes —   350,000 
Contributions from holders of noncontrolling interests 1,197   — 
Distributions to shareholders (524,994)  — 
Debt issuance costs (487)  (7,688)
Debt prepayment costs —   (296)
Net cash (used in) provided by financing activities (524,284)  125,751 
Net increase in unrestricted and restricted cash and cash equivalents 3,557   43,932 
Unrestricted and restricted cash and cash equivalents—beginning of period 239,387   195,455 
Unrestricted and restricted cash and cash equivalents—end of period$242,944  $239,387 

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