Tidewater Reports Results For The Three Months Ended March 31, 2018

05/14/2018

HOUSTON, May 14, 2018 /PRNewswire/ -- Tidewater Inc. (NYSE:TDW) announced today a net loss for the three months ended March 31, 2018, of $39.2 million, or $1.67 per common share, on revenues of $91.5 million.

As more fully explained in the company's Form 10-Q for the quarter ended March 31, 2018, upon emergence from Chapter 11 bankruptcy on July 31, 2017, the company adopted fresh start accounting in accordance with applicable accounting and reporting regulations, which resulted in the company becoming a new entity for financial reporting purposes on July 31, 2017. References herein to "Successor" relate to the financial position and results of operations of the reorganized company subsequent to July 31, 2017, while references to "Predecessor" relate to the financial position and results of operations of the company through July 31, 2017.

Included in the $39.2 million ($1.67 per common share) net loss for the three months ending March 31, 2018 were the following:

$15.2 million ($0.65 per common share) of foreign exchange losses, $14.8 million of which ($0.63 per common share) is included in Equity in net earnings (losses) of unconsolidated companies and related to our Angola joint venture, Sonatide.
$6.2 million ($0.26 per common share) in non-cash asset impairment charges that resulted from impairment reviews undertaken during the three months ended March 31, 2018.

Consolidated earnings (loss) before interest, taxes, depreciation and amortization (EBITDA) for the three months ended March 31, 2018, which excludes asset impairment charges, but includes $3.0 million of stock-based compensation expense and $15.2 million of foreign exchange losses, was ($9.9) million. (See disclosures related to Non-GAAP measures in other fleet and financial data beginning on page 10 herein.)

Common shares and New Creditor Warrants, each of which is exercisable to acquire one common share at a price of $0.001, and the sum of common shares and New Creditor Warrants outstanding at March 31, 2018 were 23,988,075, 6,021,696 and 30,009,771, respectively.

Tidewater will hold a conference call to discuss results for the three months ended March 31, 2018 on Tuesday, May 15, 2018 at 10:00 a.m. Central Time. Investors and interested parties may listen to the teleconference via telephone by calling 1-888-771-4371 if calling from the U.S. or Canada (1-847-585-4405 if calling from outside the U.S.) and ask for the "Tidewater" call just prior to the scheduled start. A replay of the conference call will be available beginning at 12:00 p.m. Central Time on May 15, 2018, and will continue until 11:59 p.m. Central Time on May 17, 2018. To hear the replay, call 1-888-843-7419 (1-630-652-3042 if calling from outside the U.S.). The conference call ID number is 46923575.

A simultaneous webcast of the conference call will be available online at the Tidewater Inc. website, (www.tdw.com). The online replay will be available until June 15, 2018.

The conference call will contain forward-looking statements in addition to statements of historical fact. The actual achievement of any forecasted results or the unfolding of future economic or business developments in a way anticipated or projected by the company involve numerous risks and uncertainties that may cause the company's actual performance to be materially different from that stated or implied in the forward-looking statements. Such risks and uncertainties include, among other things, risks associated with the general nature of the oilfield service industry and other factors discussed within the "Risk Factors" section of Tidewater's recent Forms 10-Q and 10-K.

Tidewater owns and operates one of the largest fleets of Offshore Support Vessels in the industry, with over 60 years of experience supporting offshore energy exploration and production activities worldwide.

Note: all per-share amounts are stated on a diluted basis.

Financial information is displayed on the next page.

TIDEWATER INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)
(Unaudited)
(In thousands, except share and per share data)
	Successor		Predecessor
	Quarter Ended		Quarter Ended
	March 31, 2018		March 31, 2017
Revenues:
Vessel revenues	$	87,494		156,905
Other operating revenues		3,999		3,844
		91,493		160,749
Costs and expenses:
Vessel operating costs		61,364		80,845
Costs of other operating revenues		2,474		2,689
General and administrative (A)		23,565		41,727
Vessel operating leases		—		8,443
Depreciation and amortization		12,017		37,592
Gain on asset dispositions, net		(1,919)		(6,064)
Asset impairments		6,186		64,857
		103,687		230,089
Operating loss		(12,194)		(69,340)
Other income (expenses):
Foreign exchange gain (loss)		(348)		664
Equity in net earnings (losses) of unconsolidated companies (B)		(15,439)		2,841
Interest income and other, net		(128)		1,588
Interest and other debt costs, net		(7,599)		(21,008)
		(23,514)		(15,915)
Loss before income taxes		(35,708)		(85,255)
Income tax expense		3,321		1,717
Net loss	$	(39,029)		(86,972)
Less: Net income attributable to noncontrolling interests		143		7,883
Net loss attributable to Tidewater Inc.	$	(39,172)		(94,855)
Basic loss per common share	$	(1.67)		(2.01)
Diluted loss per common share	$	(1.67)		(2.01)
Weighted average common shares outstanding (C)		23,424,943		47,080,783
Dilutive effect of stock options and restricted stock		—		—
Adjusted weighted average common shares		23,424,943		47,080,783

Note (A): The company did not incur any restructuring-related professional services costs during the quarter ended March 31, 2018 (Successor). Restructuring-related professional services costs included in general and administrative expenses for the quarter ended March 31, 2017 (Predecessor), were $16.8 million. General and administrative expenses for the quarter ended March 31, 2018 (Successor) and March 31, 2017 (Predecessor) included stock-based compensation of $3 million and $(0.9) million, respectively.

Note (B): Equity in net earnings (losses) of unconsolidated companies for the quarter ended March 31, 2018 (Successor) includes $14.8 million of foreign exchange losses related to our Angola joint venture, Sonatide.

Note (C): Weighted average shares outstanding for the quarter ended March 31, 2018 (Successor) include 108,044 shares issuable upon the exercise of New Creditor Warrants held by U.S. citizens at March 31, 2018 (Successor). Common shares and new creditor warrants and the sum of common shares and New Creditor Warrants outstanding at March 31, 2018 (Successor) were 23,988,075, 6,021,696 and 30,009,771, respectively.

TIDEWATER INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share and par value data)
	Successor
	March 31,		December 31,
ASSETS	2018		2017
Current assets:
Cash and cash equivalents	$	442,472		432,035
Restricted cash		2,847		21,300
Trade and other receivables, net		115,754		114,184
Due from affiliate		207,919		230,315
Marine operating supplies		28,896		28,220
Other current assets		18,181		19,130
Total current assets		816,069		845,184
Investments in, at equity, and advances to unconsolidated companies		13,503		29,216
Net properties and equipment		814,263		837,520
Deferred drydocking and survey costs		11,430		3,208
Other assets		30,783		31,052
Total assets	$	1,686,048		1,746,180

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	45,781		38,497
Accrued expenses		56,408		54,806
Due to affiliate		78,135		99,448
Accrued property and liability losses		2,852		2,585
Current portion of long-term debt		5,215		5,103
Other liabilities		8,826		19,693
Total current liabilities		197,217		220,132
Long-term debt		442,729		443,057
Accrued property and liability losses		2,561		2,471
Other liabilities and deferred credits		58,060		58,576

Commitments and Contingencies

Equity:
Successor Common stock of $0.001 par value, 125,000,000 shares authorized, 23,988,075 and 22,115,916 shares issues and outstanding at March 31, 2018 and December 31, 2017, respectively		24		22
Additional paid-in capital		1,061,983		1,059,120
Retained deficit		(78,438)		(39,266)
Accumulated other comprehensive loss		(446)		(147)
Total stockholders' equity		983,123		1,019,729
Noncontrolling interests		2,358		2,215
Total equity		985,481		1,021,944
Total liabilities and equity	$	1,686,048		1,746,180

TIDEWATER INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited)
(In thousands)
	Successor		Predecessor
	Quarter Ended		Quarter Ended
	March 31, 2018		March 31, 2017
Net loss	$	(39,029)		(86,972)
Other comprehensive income:
Unrealized gains (losses) on available for sale securities, net of tax of $0 and $61		(299)		(94)
Change in loss on derivative contract, net of tax of $0 and $823		—		1,317
Change in supplemental executive retirement plan liability, net of tax of $0 and ($927)		—		(1,721)
Change in pension plan minimum liability, net of tax of $0 and $215		—		399
Change in other benefit plan minimum liability, net of tax of $0 and ($2,046)		—		(3,799)
Total comprehensive loss	$	(39,328)		(90,870)

TIDEWATER INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
	Successor		Predecessor
	Quarter Ended		Quarter Ended
	March 31, 2018		March 31, 2017
Operating activities:
Net loss	$	(39,029)		(86,972)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		11,380		37,592
Amortization of deferred drydocking and survey costs		638		—
Amortization of debt premium and discounts		(443)		—
Provision for deferred income taxes		—		(2,200)
Gain on asset dispositions, net		(1,919)		(6,064)
Asset impairments		6,186		64,857
Changes in investments in, at equity, and advances to unconsolidated companies		15,713		(5,062)
Compensation expense - stock-based		2,956		(888)
Excess tax liability on stock option activity		—		4,927
Changes in assets and liabilities, net:
Trade and other receivables		(1,662)		51,051
Changes in due to/from affiliate, net		1,083		24,961
Marine operating supplies		(677)		(408)
Other current assets		949		(6,458)
Accounts payable		7,284		(18,872)
Accrued expenses		845		9,267
Accrued property and liability losses		267		9
Other current liabilities		(2,695)		(3,860)
Other liabilities and deferred credits		(58)		1,884
Cash paid for deferred drydocking and survey costs		(8,860)		—
Other, net		2,058		6,386
Net cash provided by (used in) operating activities		(5,984)		70,150
Cash flows from investing activities:
Proceeds from sales of assets		9,492		2,464
Additions to properties and equipment		(1,677)		(8,355)
Net cash provided by (used in) investing activities		7,815		(5,891)
Cash flows from financing activities:
Principal payment on long-term debt		(1,471)		(2,732)
Payments to General Unsecured Creditors		(8,377)		—
Other		1		(4,927)
Net cash used in financing activities		(9,847)		(7,659)
Net change in cash, cash equivalents and restricted cash		(8,016)		56,600
Cash, cash equivalents and restricted cash at beginning of period		453,335		649,804
Cash, cash equivalents and restricted cash at end of period	$	445,319		706,404
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest, net of amounts capitalized	$	8,152		8,218
Income taxes	$	6,429		2,167
Supplemental disclosure of non-cash investing activities:
Additions to properties and equipment	$	—		282

TIDEWATER INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(Unaudited)
(In thousands)
							Accumulated
			Additional		Retained		other		Non
	Common		paid-in		(deficit)		comprehensive		controlling
	stock		capital		earnings		loss		interest		Total
Balance at December 31, 2017 (Successor)	$	22		1,059,120		(39,266)		(147)		2,215		1,021,944
Total comprehensive loss		—		—		(39,172)		(299)		143		(39,328)
Stock option expense		—		(98)		—		—		—		(98)
Issuance of common stock		2		—		—		—		—		2
Amortization of restricted stock units		—		2,961		—		—		—		2,961
Balance at March 31, 2018 (Successor)	$	24		1,061,983		(78,438)		(446)		2,358		985,481

Balance at December 31, 2016 (Predecessor)	$	4,707		171,018		1,570,027		(6,446)		8,258		1,747,564
Total comprehensive loss		—		—		(94,855)		(3,898)		7,883		(90,870)
Stock option activity		—		269		—		—		—		269
Cancellation of restricted stock awards		—		—		157		—		—		157
Amortization/cancellation of restricted stock units		5		(6,066)		—		—		—		(6,061)
Balance at March 31, 2017 (Predecessor)	$	4,712		165,221		1,475,329		(10,344)		16,141		1,651,059

The company's vessel revenues and vessel operating costs and the related percentage of total vessel revenues, were as follows:

	Successor				Predecessor
	Quarter Ended				Quarter Ended
	March 31, 2018				March 31, 2017
(In thousands)			%				%
Vessel revenues:
Americas (D)	$	26,081		30%		80,533		51%
Middle East/Asia Pacific		18,388		21%		26,678		17%
Europe/Mediterranean Sea		9,623		11%		10,166		7%
West Africa		33,402		38%		39,528		25%
Total vessel revenues	$	87,494		100%		156,905		100%
Vessel operating costs:
Crew costs	$	34,224		39%		41,829		27%
Repair and maintenance		7,704		9%		17,074		11%
Insurance and loss reserves		(1,071)		(1%)		(1,767)		(1%)
Fuel, lube and supplies		9,012		10%		9,279		6%
Other		11,495		13%		14,430		9%
Total vessel operating costs		61,364		70%		80,845		52%
Vessel operating margin (E)	$	26,130		30%		76,060		48%

Note (D): Included in Americas vessel revenues for the quarter ended March 31, 2017 (Predecessor) is $39.1 million of revenue related to the early cancellation of a long-term vessel charter contract.

Note (E): Vessel operating margin equals vessel revenues less vessel operating costs and excludes general and administrative expenses, vessel operating leases and depreciation and amortization expenses. The following tables reconcile vessel operating margin as presented above to vessel operating profit (loss):

	Successor		Predecessor
	Quarter Ended		Quarter Ended
(In thousands)	March 31, 2018		March 31, 2017
Vessel operating margin	$	26,130		76,060
General and administrative expenses - vessel operations		(16,867)		(19,445)
Vessel operating leases		—		(8,443)
Depreciation and amortization - vessel operations		(11,912)		(36,173)
Vessel operating profit (loss)	$	(2,649)		11,999

The company's other operating profit (loss) consists of the following:

	Successor		Predecessor
	Quarter Ended		Quarter Ended
(In thousands)	March 31, 2018		March 31, 2017
Other operating revenues	$	3,999		3,844
Costs of other marine revenues		(2,474)		(2,689)
General and administrative expenses - other operating activities		(14)		(525)
Depreciation and amortization - other operating activities		(5)		(855)
Other operating profit (loss)	$	1,506		(225)

The company's operating loss and other components of loss before income taxes and its related percentage of total revenues, were as follows:

	Successor				Predecessor
	Quarter Ended				Quarter Ended
	March 31, 2018				March 31, 2017
(In thousands)			%				%
Vessel operating profit (loss):
Americas (F)	$	4,911		5%		30,618		19%
Middle East/Asia Pacific		(2,253)		(2%)		(6,164)		(4%)
Europe/Mediterranean Sea		(3,554)		(4%)		(7,102)		(5%)
West Africa		(1,753)		(2%)		(5,353)		(3%)
		(2,649)		(3%)		11,999		7%
Other operating profit (loss)		1,506		2%		(225)		(<1%)
		(1,143)		(1%)		11,774		7%

Corporate general and administrative expenses (G)		(6,684)		(7%)		(21,757)		(14%)
Corporate depreciation		(100)		(<1%)		(564)		(<1%)
Corporate expenses		(6,784)		(7%)		(22,321)		(14%)

Gain on asset dispositions, net		1,919		2%		6,064		3%
Asset impairments		(6,186)		(7%)		(64,857)		(40%)
Operating loss	$	(12,194)		(13%)		(69,340)		(43%)
Foreign exchange gain (loss)		(348)		(<1%)		664		<1%
Equity in net earnings (losses) of unconsolidated companies		(15,439)		(17%)		2,841		2%
Interest income and other, net		(128)		(<1%)		1,588		1%
Interest and other debt costs		(7,599)		(8%)		(21,008)		(13%)
Loss before income taxes	$	(35,708)		(39%)		(85,255)		(53%)

Note (F): Americas segment vessel operating profit for the quarter ended March 31, 2017 (Predecessor) includes $39.1 million of revenue related to the early cancellation of a long-term vessel charter contract.

Note (G): The company did not incur any restructuring-related professional services costs during the quarter ended March 31, 2018 (Successor). Restructuring-related professional services costs included in general and administrative expenses for the quarter ended March 31, 2017 (Predecessor), were $16.8 million. General and administrative expenses for the quarter ended March 31, 2018 (Successor) and March 31, 2017 (Predecessor) included stock-based compensation of $3 million and $(0.9) million, respectively.

For the following tables for illustrative purposes, the company has combined the Successor and Predecessor results to derive combined results for the three months ended September 30, 2017. The combination was generated by addition of comparable financial statement line items. However, because of various adjustments to the consolidated financial statements in connection with the application of fresh-start reporting, including asset valuation adjustments and liability adjustments, the results of operations for the Successor may not be comparable to those of the Predecessor. The quarters ended June 30, 2017 and March 31, 2017 are Predecessor periods while the quarters ended March 31, 2018 and December 31, 2017 are Successor periods.

TIDEWATER INC.
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) – QUARTERLY DATA
(Unaudited)
(In thousands, except share and per share data)


		Three Months Ended

		March 31,		December 31,		September 30,		June 30,		March 31,
		2018		2017		2017		2017		2017
Revenues:
Vessel revenues	$		87,494		101,313		104,911		112,257		156,905
Other operating revenues			3,999		3,140		5,652		2,849		3,844
			91,493		104,453		110,563		115,106		160,749
Costs and expenses:
Vessel operating costs			61,364		68,201		84,966		83,773		80,845
Costs of other operating revenues			2,474		1,519		3,036		1,585		2,689
General and administrative (H)			23,565		30,373		25,019		33,059		41,727
Vessel operating leases			—		91		1,747		5,542		8,443
Depreciation and amortization			12,017		12,195		19,302		36,287		37,592
Gain on asset dispositions, net			(1,919)		(6,612)		(376)		(3,189)		(6,064)
Asset impairments			6,186		16,777		21,325		163,423		64,857
			103,687		122,544		155,019		320,480		230,089
Operating loss			(12,194)		(18,091)		(44,456)		(205,374)		(69,340)
Other income (expenses):
Foreign exchange gain (loss)			(348)		(349)		(2,082)		(1,157)		664
Equity in net earnings (losses) of unconsolidated companies			(15,439)		825		1,574		4,517		2,841
Interest income and other			(128)		1,898		1,577		1,680		1,588
Reorganization items (H)			—		(2,419)		(1,085,609)		(313,176)		—
Interest and other debt costs			(7,599)		(7,769)		(5,814)		(10,605)		(21,008)
			(23,514)		(7,814)		(1,090,354)		(318,741)		(15,915)
Loss before income taxes			(35,708)		(25,905)		(1,134,810)		(524,115)		(85,255)
Income tax (benefit) expense			3,321		(2,706)		3,216		295		1,717
Net loss	$		(39,029)		(23,199)		(1,138,026)		(524,410)		(86,972)
Less: Net income (loss) attributable to noncontrolling interests			143		374		142		24		7,883
Net loss attributable to Tidewater Inc.	$		(39,172)		(23,573)		(1,138,168)		(524,434)		(94,855)
Basic loss per common share	$		(1.67)		(1.02)		—		—		—
Diluted loss per common share	$		(1.67)		(1.02)		—		—		—
Weighted average common shares outstanding (I)			23,424,943		23,137,909		—		—		—
Dilutive effect of stock options and restricted stock			—		—		—		—		—
Adjusted weighted average common shares			23,424,943		23,137,909		—		—		—

Vessel operating margin	$		26,130		33,112		19,945		28,484		76,060

Note (H): Restructuring-related items:
Restructuring-related professional services costs included in general and administrative expenses	$		—		—		—		6,709		16,805
Restructuring-related professional services costs included in reorganization items			—		2,031		23,494		5,165		—
Restructuring-related sale leaseback vessel redelivery costs included in reorganization items			—		388		1,244		—		—
Total	$		—		2,419		24,738		11,874		16,805

Note (I): Weighted average shares outstanding for the quarters ended March 31, 2018 and December 31, 2017 include 108,044 and 924,125 shares issuable upon the exercise of New Creditor Warrants held by U.S. citizens, respectively, at March 31 2018 and December 31, 2017. Common shares and New Creditor Warrants and the sum of common shares and New Creditor Warrants outstanding at March 31, 2018 were 23,988,075, 6,021,696 and 30,009,771, respectively. Common shares and New Creditor Warrants and the sum of common shares and New Creditor Warrants outstanding at December 31, 2017 were 22,115,916, 7,884,006 and 29,999,922, respectively.

TIDEWATER INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)

		March 31,		December 31,		September 30,		June 30,		March 31,
ASSETS		2018		2017		2017		2017		2017
Current assets:
Cash and cash equivalents	$		442,472		432,035		459,978		683,778		706,404
Restricted Cash			2,847		21,300		—		—		—
Trade and other receivables, net			115,754		114,184		120,271		116,612		123,262
Due from affiliate			207,919		230,315		245,056		252,810		262,652
Marine operating supplies			28,896		28,220		31,083		31,097		30,560
Other current assets			18,181		19,130		14,813		34,619		18,409
Total current assets			816,069		845,184		871,201		1,118,916		1,141,287
Investments in, at equity, and advances to unconsolidated companies			13,503		29,216		25,729		49,216		45,115
Net properties and equipment			814,263		837,520		868,689		2,659,314		2,864,762
Deferred drydocking and survey costs			11,430		3,208		388		—		—
Other assets			30,783		31,052		46,845		92,134		139,535
Total assets	$		1,686,048		1,746,180		1,812,852		3,919,580		4,190,699

News Details

Tidewater Reports Results For The Three Months Ended March 31, 2018