UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| x | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
for the quarterly period ended June 30, 2004
| ¨ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Commission File Number: 0-28316
Trico Marine Services, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 72-1252405 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
| 250 North American Court Houma, Louisiana |
70363 | |
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (985) 851-3833
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2.) Yes x No ¨
The number of shares of the Registrant’s common stock, $0.01 par value per share, outstanding at July 31, 2004 was 36,965,537.
TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
as of June 30, 2004 and December 31, 2003
(Unaudited)
(Dollars in thousands, except share and per share amounts)
| June 30, 2004 |
December 31, 2003 |
|||||||
| Restated | ||||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 22,569 | $ | 25,892 | ||||
| Restricted cash |
1,346 | 1,708 | ||||||
| Accounts receivable, net |
28,481 | 30,451 | ||||||
| Prepaid expenses and other current assets |
2,466 | 1,501 | ||||||
| Assets held for sale |
10,282 | — | ||||||
| Total current assets |
65,144 | 59,552 | ||||||
| Property and equipment, at cost: |
||||||||
| Land and buildings |
3,762 | 6,402 | ||||||
| Marine vessels |
614,604 | 661,729 | ||||||
| Construction-in-progress |
586 | 170 | ||||||
| Transportation and other |
5,190 | 4,628 | ||||||
| 624,142 | 672,929 | |||||||
| Less accumulated depreciation and amortization |
185,403 | 185,910 | ||||||
| Net property and equipment |
438,739 | 487,019 | ||||||
| Restricted cash - noncurrent |
6,642 | — | ||||||
| Other assets |
31,959 | 38,620 | ||||||
| Total assets |
$ | 542,484 | $ | 585,191 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Current maturities of debt |
$ | 368,613 | $ | 66,266 | ||||
| Accounts payable |
5,619 | 6,190 | ||||||
| Accrued expenses |
6,345 | 6,352 | ||||||
| Accrued insurance reserve |
4,003 | 4,497 | ||||||
| Accrued interest |
14,643 | 3,656 | ||||||
| Income taxes payable |
301 | 331 | ||||||
| Total current liabilities |
399,524 | 87,292 | ||||||
| Long-term debt, net of discounts |
31,571 | 313,900 | ||||||
| Deferred income taxes |
36,270 | 39,772 | ||||||
| Other liabilities |
2,139 | 2,196 | ||||||
| Total liabilities |
469,504 | 443,160 | ||||||
| Commitments and contingencies |
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| Stockholders’ equity: |
||||||||
| Preferred stock, $.01 par value, 5,000,000 shares authorized and no shares issued at June 30, 2004 and December 31, 2003 |
— | — | ||||||
| Common stock, $.01 par value, 55,000,000 shares authorized, 37,037,569 and 36,982,569 shares issued and 36,965,537 and 36,910,537 shares outstanding at June 30, 2004 and December 31, 2003 |
370 | 370 | ||||||
| Additional paid-in capital |
338,071 | 338,007 | ||||||
| Accumulated deficit |
(276,025 | ) | (214,845 | ) | ||||
| Unearned compensation |
(153 | ) | (127 | ) | ||||
| Cumulative foreign currency translation adjustment |
10,718 | 18,627 | ||||||
| Treasury stock, at par value, 72,032 shares at June 30, 2004 and December 31, 2003 |
(1 | ) | (1 | ) | ||||
| Total stockholders’ equity |
72,980 | 142,031 | ||||||
| Total liabilities and stockholders’ equity |
$ | 542,484 | $ | 585,191 | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
1
TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
(Dollars in thousands, except share and per share amounts)
| Three months ended June 30, |
Six months ended June 30, |
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| 2004 |
2003 |
2004 |
2003 |
|||||||||||||
| Revenues: |
||||||||||||||||
| Charter hire |
$ | 25,709 | $ | 34,462 | $ | 49,213 | $ | 63,420 | ||||||||
| Other vessel income |
37 | 30 | 102 | 83 | ||||||||||||
| Total revenues |
25,746 | 34,492 | 49,315 | 63,503 | ||||||||||||
| Operating expenses: |
||||||||||||||||
| Direct vessel operating expenses and other |
19,429 | 21,251 | 37,541 | 41,780 | ||||||||||||
| General and administrative |
4,122 | 3,924 | 7,677 | 7,729 | ||||||||||||
| Restructuring costs |
1,698 | — | 1,698 | — | ||||||||||||
| Amortization of marine inspection costs |
3,133 | 2,615 | 6,013 | 4,972 | ||||||||||||
| Depreciation and amortization expense |
8,387 | 8,652 | 16,674 | 17,176 | ||||||||||||
| Impairment of goodwill |
— | 28,640 | — | 28,640 | ||||||||||||
| Impairment of long-lived assets |
8,584 | — | 8,584 | — | ||||||||||||
| Loss on assets held for sale |
8,674 | 5,225 | 8,674 | 5,225 | ||||||||||||
| Loss (gain) on sales of assets |
2 | (1 | ) | 11 | (484 | ) | ||||||||||
| Total operating expenses |
54,029 | 70,306 | 86,872 | 105,038 | ||||||||||||
| Operating loss |
(28,283 | ) | (35,814 | ) | (37,557 | ) | (41,535 | ) | ||||||||
| Interest expense |
(10,492 | ) | (7,726 | ) | (17,928 | ) | (15,584 | ) | ||||||||
| Amortization of deferred financing costs |
(7,460 | ) | (244 | ) | (7,700 | ) | (471 | ) | ||||||||
| Loss on early retirement of debt |
— | — | (618 | ) | — | |||||||||||
| Other income (loss), net |
135 | 573 | 634 | (235 | ) | |||||||||||
| Loss before income taxes |
(46,100 | ) | (43,211 | ) | (63,169 | ) | (57,825 | ) | ||||||||
| Income tax benefit |
(1,374 | ) | (1,222 | ) | (1,989 | ) | (2,365 | ) | ||||||||
| Net loss |
$ | (44,726 | ) | $ | (41,989 | ) | $ | (61,180 | ) | $ | (55,460 | ) | ||||
| Basic loss per common share: |
||||||||||||||||
| Net loss |
$ | (1.21 | ) | $ | (1.16 | ) | $ | (1.66 | ) | $ | (1.53 | ) | ||||
| Average common shares outstanding |
36,862,735 | 36,272,335 | 36,856,773 | 36,272,335 | ||||||||||||
| Diluted loss per common share: |
||||||||||||||||
| Net loss |
$ | (1.21 | ) | $ | (1.16 | ) | $ | (1.66 | ) | $ | (1.53 | ) | ||||
| Average common shares outstanding |
36,862,735 | 36,272,335 | 36,856,773 | 36,272,335 | ||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
2
TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(Dollars in thousands)
| Six months ended June 30, |
||||||||
| 2004 |
2003 |
|||||||
| Net loss |
$ | (61,180 | ) | $ | (55,460 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
| Depreciation and amortization |
33,288 | 22,685 | ||||||
| Deferred marine inspection costs |
(7,291 | ) | (8,345 | ) | ||||
| Deferred income taxes |
(1,956 | ) | (2,365 | ) | ||||
| Loss on early retirement of debt |
618 | — | ||||||
| Loss (gain) on sales of assets |
11 | (484 | ) | |||||
| Loss on assets held for sale |
8,674 | 5,225 | ||||||
| Impairment of goodwill |
— | 28,640 | ||||||
| Impairment of long-lived assets |
8,584 | — | ||||||
| Provision for doubtful accounts |
505 | 60 | ||||||
| Amortization of unearned compensation |
38 | — | ||||||
| Change in operating assets and liabilities: |
||||||||
| Accounts receivable |
810 | (78 | ) | |||||
| Prepaid expenses and other current assets |
(997 | ) | (1,400 | ) | ||||
| Accounts payable and accrued expenses |
10,225 | (593 | ) | |||||
| Other, net |
(1,143 | ) | (495 | ) | ||||
| Net cash used in operating activities |
(9,814 | ) | (12,610 | ) | ||||
| Cash flows from investing activities: |
||||||||
| Purchases of property and equipment |
(4,874 | ) | (13,559 | ) | ||||
| Proceeds from sales of assets |
110 | 627 | ||||||
| (Increase) decrease in restricted cash |
(6,308 | ) | 319 | |||||
| Other |
(283 | ) | 1,109 | |||||
| Net cash used in investing activities |
(11,355 | ) | (11,504 | ) | ||||
| Cash flows from financing activities: |
||||||||
| Proceeds from issuance of long-term debt |
55,365 | |||||||