-revenue of $48.5 million -net income was $12.6 million compared to net income of $6.8 million in the first quarter -This is the seventh consecutive quarter of year-on-year growth in cash resales as oil and gas activity in North America remained strong.
That's the actual form:
Press Release Source: Seitel, Inc.
Seitel Announces 2006 Second Quarter Results Tuesday August 8, 6:13 pm ET Revenue Grows 35 Percent Year-on-Year; Net Income 86 Percent Higher Than First Quarter
HOUSTON, Aug. 8 /PRNewswire-FirstCall/ -- Seitel, Inc. (OTC Bulletin Board: SELA - News), a leading provider of seismic data to the oil and gas industry, today reported revenue of $48.5 million for the second quarter ended June 30, 2006, compared to revenue of $44.7 million in the first quarter of 2006 and $36.0 million in the second quarter of last year. Cash resales reached $27.0 million, compared to $33.6 million for the first quarter of 2006 and $21.0 million in the second quarter of last year, a 28% year-on-year improvement. This is the seventh consecutive quarter of year-on-year growth in cash resales as oil and gas activity in North America remained strong. For the six month period in 2006, cash resales were $60.6 million compared to $45.2 million in the same period for 2005, a 34% year-on-year improvement. ADVERTISEMENT
For the second quarter of 2006, net income was $12.6 million, or $0.08 per fully diluted share, compared to net income of $6.8 million, or $0.04 per fully diluted share, in the first quarter of this year and a loss of $695,000 in the second quarter of 2005. Net income for the first six months of 2006 reached $19.4 million, or $0.12 per fully diluted share, compared to a net loss of $841,000, or $0.01 per share, for the same period of 2005.
"Our growing data library combined with increasing exploration activity have pushed our cash resales to a second quarter record high," commented Rob Monson, chief executive officer. "In addition to the excellent performance of our library across all regions, we made great progress towards our investment plan. New survey activity continued to ramp up and we purchased an attractive 600 square mile block of data from one of our customers in Louisiana. We expect this latest investment vintage will produce results similar to the returns we are realizing with our existing data.
"Our significant increases in operating margins and net income are further testaments to the quality of our data base, as fully amortized, vintage data remain in high demand," stated Monson. "With the continued strength of drilling and exploration in North America, we expect to continue to realize similar success for the remainder of the year."
The company reported operating income of $16.5 million in the 2006 second quarter, compared to operating income of $4.9 million in the 2005 second quarter and $12.0 million in the first quarter of this year. Operating margins improved to 34% during the current quarter, an improvement of 20 percentage points over the second quarter of 2005, and a sequential increase of 7 percentage points. Depreciation and amortization expense for the second quarter of 2006 was $23.0 million compared to $23.7 million for the same period in 2005 and to $23.8 million in the first quarter of this year. The 2006 period reflects lower amortization resulting from the effects of the level of revenue recognized on data with fully amortized costs, which increased to 72% of the total resales from the library as compared to 62% in the first quarter of this year and 52% for the second quarter of 2005.
Selling, general and administrative expenses were $8.9 million for the second quarter of 2006, compared to $9.0 million in the first quarter of this year and $7.3 million in the second quarter of 2005. The above expenses included non-cash compensation of $794,000 in the second quarter of 2006, $406,000 in the same period last year and $604,000 in the first quarter of 2006.
Cash margin, defined as cash revenues other than from data acquisition plus gain on sale of seismic data less cash expenses, is the indicator management believes best measures the level of cash from operations that is available for debt service and capital expenditures, net of underwriting. Cash margin for the second quarter increased to $21.3 million, compared to $15.6 million for the same period last year and $27.6 million for the first quarter of 2006. Cash margin for the 2006 six month period totaled $48.9 million compared to $33.2 million in the first six months of 2005. Our cash balances also continued to grow, closing at $88.3, up $7.8 million from the prior quarter end.
CONFERENCE CALL
Seitel will broadcast live via the Internet its 2006 second quarter results tomorrow, August 9 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time). To listen to the Webcast and gain access to the accompanying slide presentation, log on to the company's Website at http://www.seitel-inc.com/investorrelations.asp and click on the Second Quarter 2006 Earnings Webcast link. The Webcast will be available as a combined audio and visual presentation or as a visual presentation only (by using the "Live Phone Only" button on the Webcast) for those dialing in on the conference call. To dial in for the call and to participate in the question and answer session, dial 866-510-0704, passcode Seitel. The call will also be available for replay for 30 days by dialing 888-286-8010, passcode 50245113. A replay of the Webcast will be available on the investor relations page of the company's Website within 24 hours of the call. The slide presentation will be available immediately after the call on the company's Website at http://www.seitel-inc.com/investorrelations.asp .
ABOUT SEITEL
Seitel, founded in 1982, has grown to become the owner of one of the largest seismic data libraries providing information to the North American oil and gas market. Focused on the U.S. and Canada, the company owns data in all the major exploration and production basins. Seitel continues to grow the data library using its 20 years of experience in performing seismic surveys in North America. Seitel's strengths include expertise in managing and delivering seismic data, as well as an experienced and dynamic sales and marketing team. Seitel's seismic data library includes both onshore and offshore three-dimensional (3D) and two-dimensional (2D) data and offshore multi-component data. The company has ownership in over 37,000 square miles of 3D and approximately 1.1 million linear miles of 2D seismic.
Statements in this release about the future outlook related to Seitel involve known and unknown risks and uncertainties, which may cause Seitel's actual results to differ materially from expected results. While Seitel believes its forecasting assumptions are reasonable, there are factors that are hard to predict and influenced by economic and other conditions that are beyond Seitel's control. Other important factors which could cause actual results to differ materially from those in the forward-looking statements are detailed in Seitel's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K, a copy of which may be obtained from Seitel without charge.
(Tables to follow)
SEITEL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
(Unaudited) June 30, December 31, 2006 2005 ASSETS Cash and cash equivalents $88,328 $78,097 Restricted cash 102 85 Receivables Trade, net 43,668 27,385 Notes and other, net 1,146 509 Net seismic data library 123,778 111,946 Net property and equipment 8,622 9,456 Oil and gas operations held for sale 358 194 Investment in marketable securities 74 54 Prepaid expenses, deferred charges and other 14,008 13,071 Deferred income taxes 5,611 5,874
TOTAL ASSETS $285,695 $246,671
LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Accounts payable and accrued liabilities $38,383 $25,666 Income taxes payable 43 276 Oil and gas operations held for sale 148 40 Debt Senior Notes 185,522 185,272 Notes payable 361 378 Obligations under capital leases 3,065 2,950 Deferred revenue 47,945 43,250 TOTAL LIABILITIES 275,467 257,832
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY Preferred stock, par value $.01 per share; authorized 5,000,000 shares; none issued --- --- Common stock, par value $.01 per share; authorized 400,000,000 shares; issued and outstanding 155,387,831 shares at June 30, 2006 and 153,604,345 shares at December 31, 2005 1,554 1,536 Additional paid-in capital 239,363 241,289 Retained deficit (236,869) (256,227) Deferred compensation - restricted stock --- (2,944) Notes receivable from officers and employees for stock purchases --- (1) Accumulated other comprehensive income 6,180 5,186 TOTAL STOCKHOLDERS' EQUITY (DEFICIT) 10,228 (11,161)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $285,695 $246,671
SEITEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Three Months Ended June 30, 2006 2005
REVENUE $48,542 $35,961
EXPENSES Depreciation and amortization 23,034 23,665 Loss on sale of seismic data 26 --- Cost of sales 55 49 Selling, general and administrative expenses 8,906 7,318 32,021 31,032
INCOME FROM OPERATIONS 16,521 4,929
Interest expense, net (4,989) (6,029) Foreign currency exchange gains (losses) 1,295 (625) Loss on sale of security --- (11)
Income (loss) from continuing operations before income taxes 12,827 (1,736)
Provision (benefit) for income taxes 199 (1,039)
Income (loss) from continuing operations 12,628 (697)
Income (loss) from discontinued operations (9) 2
NET INCOME (LOSS) $12,619 $(695)
Income (loss) per share: Basic: Income (loss) from continuing operations $.08 $--- Income (loss) from discontinued operations --- --- Net income (loss) $.08 $--- Diluted: Income (loss) from continuing operations $.08 $--- Income (loss) from discontinued operations --- --- Net income (loss) $.08 $---
Weighted average number of common and common equivalent shares: Basic 150,857 152,276 Diluted 166,760 152,276
SEITEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Six Months Ended June 30, 2006 2005
REVENUE $93,240 $83,267
EXPENSES Depreciation and amortization 46,812 56,922 Gain on sale of seismic data (231) --- Cost of sales 163 88 Selling, general and administrative expenses 17,936 15,338 64,680 72,348
INCOME FROM OPERATIONS 28,560 10,919
Interest expense, net (9,897) (11,979) Foreign currency exchange gains (losses) 1,134 (817) Loss on sale of security --- (11)
Income (loss) from continuing operations before income taxes 19,797 (1,888)
Provision (benefit) for income taxes 383 (1,028)
Income (loss) from continuing operations 19,414 (860)
Income from discontinued operations 4 19
NET INCOME (LOSS) $19,418 $(841)
Income (loss) per share: Basic: Income (loss) from continuing operations $.13 $(.01) Income from discontinued operations --- --- Net income (loss) $.13 $(.01) Diluted: Income (loss) from continuing operations $.12 $(.01) Income from discontinued operations --- --- Net income (loss) $.12 $(.01)
Weighted average number of common and common equivalent shares: Basic 150,790 152,065 Diluted 165,717 152,065
The following table summarizes the components of our revenue for the three and six months ended June 30, 2006 and 2005 and the three months ended March 31, 2006 (in thousands):
Three Months Six Months Ended Ended June 30, March 31, June 30, 2006 2005 2006 2006 2005
The following table shows the percentage growth in cash resales and total revenue year-on-year for second quarter 2005 to second quarter 2006:
Year-on-Year Cash resales 28% Total revenue 35%
The following table shows cash margin (defined as cash revenues other than from data acquisitions plus gain on sale of seismic data less cash selling, general and administrative expenses and costs of goods sold) and the reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure, operating income, for the three and six months ended June 30, 2006 and 2005 and the three months ended March 31, 2006 (in thousands):
Three Months Six Months Ended Ended June 30, March 31, June 30, 2006 2005 2006 2006 2005 Cash margin $21,302 $15,613 $27,619 $48,921 $33,232
The following table summarizes the cash and non-cash components of our selling, general and administrative ("SG&A") expenses for the three months ended June 30, 2006 and 2005 and the three months ended March 31, 2006 (in thousands):
Three Months Ended June 30, June 30, March 31, 2006 2005 2006 Cash SG&A $8,112 $6,912 $8,426 Non-cash SG&A 794 406 604 Total SG&A $8,906 $7,318 $9,030