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The Company continued to reduce its exposure to the towing and supply business, especially in the North Sea, by completing four asset sales for total proceeds of approximately $40 million in the fourth quarter at attractive EBITDA multiples. Since the end of the fourth quarter through the date of this release, the Company has reached definitive agreements for approximately $20 million in additional sales of non-core assets. Our current view of the worldwide OSV market is that prices and utilization in virtually all markets will remain very weak with the anticipated level of newly built vessels to be delivered in 2010 and 2011. In addition, since September 30, 2009 through the date of this release, the Company further reduced its remaining fleet of OSV's from 45 to 37 vessels. Beginning in the first quarter of 2008, several Norwegian ship owning companies initiated legal proceedings against the Norwegian government claiming that the claw-back rules under the newly enacted tonnage tax regime represented a violation of the Norwegian Constitution's ban on retroactive legislation. On February 12, 2010, the Norwegian Supreme Court ruled in favor of the ship owners and came to the conclusion that the transitional rules, where the untaxed profits under the old tonnage tax regime became payable when entering into the new regime were unconstitutional. As a result of the ruling, the Company expects to recognize approximately $44 million in income in the first quarter of 2010, including approximately $4 million of cash savings that would have become due in 2010 and $8 million in cash refunds related to prior year tax payments. Going forward, the $36 million of payments over the next eight years will no longer be required. Liquidity Outlook At December 2009, the Company had $53 million in cash and $734 million in total debt. $53 million of our total debt is classified as due and payable within twelve months compared to $240 million prior to the completion in the fourth quarter of a $400 million high yield bond offering. At December 2009, the Company's cash and credit availability was $63 million. Committed capital expenditures are $38 million. The Company is currently pursuing a number of transactions in order to increase its liquidity to levels sufficient to meet its commitments, including, but not limited to, additional sales of non-core OSV assets. Management of the Company's capital structure and debt reduction remain the Company's highest priorities. Chairman and Chief Executive Officer, Joseph S. Compofelice, commented, " In the fourth quarter, revenues and earnings reflected the soft market conditions in the oilfield in general, especially where we experienced continued weakness in the North Sea. While both CTC Marine and Deep Ocean have made good progress winning work outside the North Sea, I expect to see much more progress in all of our markets in the last three quarters of 2010 and into 2011. We are noticing an increase in tender offers and inquiries since the beginning of the year in most international markets. Based on the current and expected level of subsea completion awards and levels of tendering activity for the Company, we are cautiously optimistic about the future growth and profitability of our subsea businesses." Market Outlook The operating results in the fourth quarter and early into the first quarter 2010 continue to reflect weakness in the North Sea and the Asia Pacific region, but we are encouraged by certain recent developments which we anticipate will be reflected in our results commencing in the second quarter of 2010. We currently have approximately two-thirds of our 2010 expected revenues under contract with promising prospects targeted for the remainder of the year. Our backlog is approximately $600 million of termed out or long-term contracts spread principally across the Subsea Services and Towing and Supply businesses. In the fourth quarter of 2009, approximately 82% of our revenues were generated through our subsea businesses. About Trico Marine Group Trico Marine is an integrated provider of subsea, trenching and marine support vessels and services. Trico Marine recently increased its subsea market presence through its acquisition of DeepOcean, a recognized market leader in the provision of high quality subsea services including, IMR, survey and construction support, subsea intervention and decommissioning, marine trenching and the laying and burying of subsea cable. DeepOcean controls a well equipped fleet of vessels and operates a fleet of modern ROVs and trenching equipment. Trico Marine also continues to provide a broad range of marine support services to the oil and gas industry through use of its diversified fleet of vessels including the transportation of drilling materials, supplies and crews to drilling rigs and other offshore facilities; towing drilling rigs and equipment, and support for the construction, installation, repair and maintenance of offshore facilities. Trico Marine is headquartered in The Woodlands, Texas and has a global presence with operations in the North Sea, West Africa, Mexico, Brazil and Southeast Asia. Trico Marine Group |
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Trico Reports 2009 Fourth Quarter and Year-End Results