Vantage Drilling CO - FORM 8-K - EX-99.1 - PRESS RELEASE DATED MARCH 16, 2011. - March 16, 2011

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Vantage Drilling Company Reports Fourth Quarter 2010 Results

HOUSTON, TX--(MARKET WIRE)-March 16, 2011 -- Vantage Drilling Company ("Vantage") (AMEX: VTG-U) (AMEX:VTG) (AMEX: VTG-WS) reports a net loss of ($13.0) million or ($0.05) per diluted share for the three months ended December 31, 2010 as compared to net loss of ($4.3) million or ($0.02) per diluted share for the three months ended December 31, 2009 .

Net loss for the fiscal year ended December 31, 2010 was ($19.8) million or ($0.08) per share, excluding $3.8 million ($.01 per share) of charges associated with the acquisition of the Platinum Explorer and $24.0 million ($.09 per share) of charges associated with refinancing of debt in July 2011. Including the acquisition charges and refinancing charges, the Company reported a net loss of ($47.6) million or ($0.19) per diluted share for the three year ended December 31, 2010 as compared to a net income of $8.8 million or $0.07 per share for the year ended December 31, 2009.

Paul Bragg, Chairman and Chief Executive Officer, commented, "During 2010, we completed construction and deployment of the final unit of our initial five-rig owned fleet. All of the units were delivered on time and within budget and each was contracted prior to completion. Since the start up of initial rig operations almost 26 months ago, we have experienced operational excellence across the fleet, providing safe and efficient drilling services to our customers. Today, Vantage rigs are employed on some of the industry's most challenging projects."

On July 30, 2010, Vantage acquired the 55% interest in Mandarin Drilling Corporation ("Mandarin"), from F3 Capital for $139.7 million. The sole asset of Mandarin was the ultra-deepwater drillship Platinum Explorer which was then still under construction. F3 Capital was wholly owned by Hsin-Chi Su, one of the Company's directors and a significant shareholder of the Company.

In connection with the acquisition of Mandarin, Vantage issued $1.0 billion of 11.5% Senior Secured First Lien Notes due 2015. The notes have a maturity of five years from the date of issuance and are fully and unconditionally guaranteed by Vantage and certain of its subsidiaries. In addition to using the proceeds to fund the Mandarin acquisition, Vantage also retired certain of its outstanding credit facilities and its 13.5% Senior Secured Notes.

The construction of the Platinum Explorer was completed and the Company took delivery of the drillship on November 15, 2010. The Platinum Explorer mobilized to India and commenced its five year drilling contract with Oil & Natural Gas Company on December 29, 2010.

 

 

 

 

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with four Baker Marine Pacific Class 375 ultra-premium jackup drilling rigs operating, and an ultra deepwater drillship, the Platinum Explorer. Vantage is also providing management services for four other ultra-deepwater drillships.

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.

 

 

 

Contact:

Public & Investor Relations Contact:

Paul A. Bragg

Chairman & Chief Executive Officer

Vantage Drilling Company

(281) 404-4700

 

 

Vantage Drilling Company

Consolidated Statement of Operations

(In thousands, except per share amounts)

(Unaudited)

Three Months Ended December 31,

2010

2009

Revenues

Contract drilling services

$

45,881

$

22,982

Management fees

4,717

3,701

Reimbursables

34,294

11,875

Total revenues

84,892

38,558

Operating  costs and expenses

Operating costs, excluding impairment and termination costs

63,441

30,678

General and administrative

6,016

4,550

Depreciation

8,773

4,295

Total operating expenses

78,230

39,523

Income (loss) from operations

6,662

(965)

Other income (expense)

Interest income

166

10

Interest expense

(14,219)

(4,174)

Other income

(58)

293

Total other income (expense)

(14,111)

(3,871)

Income before income taxes

(7,449)

(4,836)

Income tax provision (benefit)

5,516

(562)

Net income (loss)

$

(12,965)

$

(4,274)

 

Earnings per share

Basic

$

(0.05)

$

(0.02)

Diluted

$

(0.05)

$

(0.02)

 

 

Vantage Drilling Company

Consolidated Statement of Operations

(In thousands, except per share amounts)

Year Ended December 31,

2010

2009

2008

Revenues

Contract drilling services

$

178,514

$

69,919

$

-

Management fees

18,107

18,830

825

Reimbursables

81,782

22,744

88

Total revenues

278,403

111,493

913

Operating  costs and expenses

Operating costs, excluding impairment and termination costs

176,387

66,228

5,365

General and administrative

21,719

15,690

9,334

Depreciation

33,384

11,218

101

Impairment and termination costs

-

-

38,286

Total operating expenses

231,490

93,136

53,086

Income (loss) from operations

46,913

18,357

(52,173)

Other income (expense)

Interest income

562

23

4,095

Interest expense

(49,827)

(8,178)

(56)

Loss on debt extinguishment

(24,006)

-

-

Loss on acquisition of subsidiary

(3,780)

-

-

Other income

1,510

609

86

Total other income (expense)

(75,541)

(7,546)

4,125

Income (loss) before income taxes

(28,628)

10,811

(48,048)

Income tax provision (benefit)

18,951

1,972

(670)

Net income (loss)

$

(47,579)

$

8,839

$

(47,378)

 

Earnings (loss) per share

Basic

$

(0.19)

$

0.07

$

(0.78)

Diluted

$

(0.19)

$

0.07

$

(0.78)

 

Vantage Drilling Company

Consolidated Balance Sheet

(In thousands, except par value information)

December 31,

2010

2009

ASSETS

Current assets

Cash and cash equivalents

$

120,443

$

15,992

Restricted cash

29,004

28,863

Trade receivables

50,190

17,536

Inventory

19,760

10,789

Prepaid expenses and other current assets

11,472

8,040

Total current assets

230,869

81,220

Property and Equipment

Property and equipment

1,762,844

899,541

Accumulated depreciation

(44,712)

(11,329)

Property and equipment, net

1,718,132

888,212

Other Assets

Investment in joint venture

-

120,306

Other assets

54,193

29,441

Total other assets

54,193

149,747

Total assets

$

2,003,194

$

1,119,179

 

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

Accounts payable

$

32,332

$

15,931

Accrued liabilities

75,159

14,285

Short-term debt

8,574

17,827

Current maturities of long-term debt

-

16,000

Total current liabilities

116,065

64,043

Long-term debt, net of discount of $63,654 and $4,021

1,103,480

378,078

Other long-term liabilities

13,498

-

Commitments and contingencies

-

-

Shareholders' equity

Preferred shares, $0.001 par value, 10,000 shares authorized; none issued or outstanding

-

-

Ordinary shares, $0.001 par value, 400,000 shares authorized; 289,713 and 187,277 shares issued and outstanding

290

187

Additional paid-in capital

854,557

714,486

Accumulated deficit

(84,696)

(37,117)

Accumulated other comprehensive loss

-

(498)

Total shareholders' equity

770,151

677,058

Total liabilities and shareholders' equity

$

2,003,194

$

1,119,179

 

 

Vantage Drilling Company

Consolidated Statement of Cash Flows

(In thousands)

Year Ended December 31,

2010

2009

2008

CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss)

$

(47,579)

$

8,839

$

(47,378)

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation expense

33,384

11,218

101

Amortization of debt financing costs

5,389

1,486

513

Non-cash loss on debt extinguishment

12,280

-

-

Non-cash loss on acquisition of subsidiary

3,780

-

-

Share-based compensation expense

6,141

5,030

2,420

Accretion of long-term debt

5,495

1,638

-

Amortization of debt discount

5,592

29

-

Deferred income tax expense (benefit)

1,492

746

(2,059)

Write-off of asset value, net

-

-

28,286

Changes in operating assets and liabilities:

Restricted cash

(142)

(27,163)

(1,700)

Trade receivables

(40,791)

(14,350)

(3,277)

Inventory

(8,971)

(10,789)

-

Prepaid expenses and other current assets

(3,433)

(5,963)

(1,618)

Other assets

(11,945)

(406)

-

Accounts payable

16,402

12,104

3,765

Accrued liabilities

27,744

(14,792)

9,935

Short-term debt

10,899

4,942

1,240

Net cash provided by (used in) operating activities

15,737

(27,431)

(9,772)

CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of assets

(79,777)

-

(213,397)

Additions to property and equipment

(565,759)

(313,631)

(166,833)

Investment in joint venture

-

(157,404)

-

Deferred acquisition costs

-

-

-

Restricted cash held in trust account

-

-

273,109

Net cash used in investing activities

(645,536)

(471,035)

(107,121)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issuance of senior secured notes, net of original issue discount of $36,390

963,610

-

-

Proceeds from borrowings under credit agreements

-

141,821

139,000

Proceeds from the issuance of senior secured notes, net of discount of $4,021

-

130,950

-

Repayment of long-term debt

(293,129)

(19,360)

-

Proceeds from issuance of ordinary shares in public offerings, net

101,889

80,291

-

Proceeds from issuance of ordinary shares in private placement, net

-

24,953

-

Proceeds from warrant exercise in connection with joint venture

-

150,000

-

Proceeds from short-term notes payable-shareholders

-

4,000

-

Repayment of short-term debt

(6,152)

(2,354)

-

Debt issuance costs

(31,968)

(12,400)

(8,533)

Advances from OGIL stockholders

-

-

3,300

Repayments of advances from OGIL stockholders

-

-

(3,300)

Repayment of deferred underwriters fee

-

-

(8,280)

Proceeds from notes payable - shareholders

-

-

10,000

Net cash provided by financing activities

734,250

497,901

132,187

Net increase (decrease) in cash and cash equivalents

104,451

(565)

15,294

Cash and cash equivalents-beginning of period

15,992

16,557

1,263

Cash and cash equivalents-end of period

$

120,443

$

15,992

$

16,557

 

Vantage Drilling CO Reports

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