MIDLAND, Texas, March 2, 2017 /PRNewswire/ -- Dawson Geophysical
Company (NASDAQ: DWSN) (the "Company") today reported preliminary
financial results for its fourth quarter and full year ended
December 31, 2016.
For the quarter ended December 31, 2016, the Company
reported revenues of $30,067,000 as
compared to $55,130,000 for the
quarter ended December 31, 2015. For the fourth quarter 2016,
the Company reported a net loss of $7,187,000, or $0.33 loss per share attributable to common
stock, as compared to a net loss of $4,940,000, or $0.23 loss per share attributable to common
stock, for the quarter ended December 31, 2015. The Company
reported EBITDA of $313,000 for the
quarter ended December 31, 2016 compared to $3,945,000 for the quarter ended
December 31, 2015.
For the year ended December 31, 2016, the Company reported
revenues of $133,330,000 as compared
to $234,685,000 (or $248,295,000 on a pro forma basis) for the year
ended December 31, 2015. For the full year 2016, the Company
reported a net loss of $39,792,000,
or $1.84 loss per share attributable
to common stock, as compared to a net loss of $26,279,000 (or $30,256,000 on a pro forma basis), or
$1.27 loss per share (or $1.40 on a pro forma basis) attributable to
common stock, for the year ended December 31, 2015. The
Company reported negative EBITDA of $2,045,000 for the year ended December 31,
2016 compared to EBITDA of $7,488,000
for the year ended December 31, 2015. The Company's balance
sheet remains strong with $54,874,000
of cash and short term investments, $60,730,000 of working capital and $2,357,000 of debt and capital lease obligations
at December 31, 2016.
Stephen C. Jumper, President and
CEO, said, "Demand for seismic data acquisition services in
North America and worldwide
continues to be soft in response to low and uncertain oil prices
and reduced client expenditures. During the quarter ended
December 31, 2016, oil prices
averaged approximately $49 per
barrel, an increase from the September 30,
2016 quarter average of approximately $45 per barrel. While encouraging, it remains to
be determined if the recent strengthening in oil prices can be
sustained, and the price increases have yet to result in a
meaningful increase in demand for our services. As we experienced
uncertainty in oil and natural gas prices during our first three
quarters of 2016, our client base continues to take a cautious
approach to their capital spending. Based on currently available
information, seismic service demand levels and the winter season in
Canada, we believe we will
continue to operate four to six crews in the United States and Canada through the first quarter of 2017.
Visibility beyond the first quarter of 2017 remains unclear. In
response to these factors, we will continue our on-going effort to
control costs and maintain a strong balance sheet, our experienced
personnel and our position as a leading onshore seismic data
acquisition company in North
America."
Capital expenditures for the year ended December 31, 2016 were $9,793,000, primarily composed of replacement
recording channels lost in the spring 2015 and 2016 floods in
southeast Texas and Oklahoma. These expenditures were funded in
part by insurance proceeds received related to those losses. The
Company's capital budget for 2016 was at maintenance levels below
the $10 million approved by our board
of directors.
Mr. Jumper concluded, "2016 was a difficult year for our
Company. That said, the price of oil has materially increased from
the decade low reached in February 2016. Although we have not
seen a meaningful increase in proposals as previously discussed,
this positive development is very encouraging. The oil market
appears to be slowly working through a rebalancing phase. We
believe oil and gas companies will gradually start to put capital
back to work, and seismic surveys should play an important role in
helping these companies maximize their production economics. Our
continuing commitment to maintain a strong balance sheet while
operating the largest fleet of state-of-the-art land-based seismic
equipment with the most experienced personnel in the industry
uniquely positions Dawson Geophysical to successfully respond to
the market as conditions improve."
On February 11, 2015, legacy Dawson Geophysical Company and
legacy TGC Industries, Inc. consummated their previously
announced strategic business combination. The merger transaction
was accounted for as a reverse acquisition with legacy Dawson
Geophysical being deemed the accounting acquirer with the results
of legacy TGC Industries, Inc. being reflected in the
Company's reported consolidated financial results only for periods
from and after February 11, 2015. The merged companies adopted
a calendar fiscal year ending December 31. Due to the
foregoing, comparative financial results that include periods prior
to February 11, 2015 are not comparable to financial results
that include periods from and after February 11, 2015. As a
result, the Company is including selected unaudited pro-forma
financial information showing, on a pro forma basis, the effect of
the business combination as if it had occurred on January 1,
2015 (together with the assumptions related thereto), at the end of
this press release. Additional information regarding the business
combination and its impact on the Company's financial position will
be set forth in the Company's Form 10-K for the year ended
December 31, 2016, which will be filed with the Securities and
Exchange Commission on or about March 15, 2017, and in the
Company's Form 10-K for the year ended December 31, 2015, which was filed with the
Securities and Exchange Commission on March 16, 2016.
Conference Call Information
Dawson Geophysical Company will host a conference call to review
its year end and fourth quarter 2016 financial results on
March 2, 2017 at 9 a.m. Central / 10:00 a.m. Eastern. Participants can access the
call at 1-888-455-2265 (US) and 1-719-457-2639
(Toll/International). To access the live audio webcast or the
subsequent archived recording, visit the Dawson website at
www.dawson3d.com. Callers can access the telephone replay through
April 2, 2017 by dialing
1-844-512-2921 (Toll-Free) and 1-412-317-6671 (Toll/International).
The passcode is 5138505. The webcast will be recorded and available
for replay on Dawson's website until April 2, 2017.
About Dawson
Dawson Geophysical Company is a leading provider of North America onshore seismic data acquisition
services with operations throughout the continental United States and Canada. Dawson acquires and processes 2-D, 3-D
and multi-component seismic data solely for its clients, ranging
from major oil and gas companies to independent oil and gas
operators, as well as providers of multi-client data libraries.
Non-GAAP Financial Measures
In an effort to provide investors with additional information
regarding the Company's preliminary and unaudited results as
determined by GAAP, the Company has included in this press release
information about the Company's EBITDA, a non-GAAP financial
measure as defined by Regulation G promulgated by the U.S.
Securities and Exchange Commission. The Company defines EBITDA as
net income (loss) plus interest expense, interest income, income
taxes, and depreciation and amortization expense. The Company uses
EBITDA as a supplemental financial measure to assess:
- the financial performance of its assets without regard to
financing methods, capital structures, taxes or historical cost
basis;
- its liquidity and operating performance over time in relation
to other companies that own similar assets and that the Company
believes calculate EBITDA in a similar manner; and
- the ability of the Company's assets to generate cash sufficient
for the Company to pay potential interest costs.
The Company also understands that such data are used by
investors to assess the Company's performance. However, the
term EBITDA is not defined under generally accepted accounting
principles, and EBITDA is not a measure of operating income,
operating performance or liquidity presented in accordance with
generally accepted accounting principles. When assessing the
Company's operating performance or liquidity, investors and others
should not consider this data in isolation or as a substitute for
net income (loss), cash flow from operating activities or other
cash flow data calculated in accordance with generally accepted
accounting principles. In addition, the Company's EBITDA may not be
comparable to EBITDA or similar titled measures utilized by other
companies since such other companies may not calculate EBITDA in
the same manner as the Company. Further, the results presented by
EBITDA cannot be achieved without incurring the costs that the
measure excludes: interest, taxes, and depreciation and
amortization. A reconciliation of the Company's EBITDA to its net
loss is presented in the table following the text of this press
release.
Forward-Looking Statements
In accordance with the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995, the Company cautions that
statements in this press release which are forward-looking and
which provide other than historical information involve risks and
uncertainties that may materially affect the Company's actual
results of operations. Such forward looking statements are based on
the beliefs of management as well as assumptions made by and
information currently available to management. Actual results could
differ materially from those contemplated by the forward looking
statements as a result of certain factors. These risks include, but
are not limited to, dependence upon energy industry spending; the
volatility of oil and natural gas prices; changes in economic
conditions; the potential for contract delays; reductions or
cancellations of service contracts; limited number of customers;
credit risk related to our customers; reduced utilization; high
fixed costs of operations and high capital requirements;
operational disruptions; industry competition; external factors
affecting the Company's crews such as weather interruptions and
inability to obtain land access rights of way; whether the Company
enters into turnkey or day rate contracts; crew productivity; the
availability of capital resources; and disruptions in the global
economy. A discussion of these and other factors, including risks
and uncertainties, is set forth in the Company's Annual Report on
Form 10-K that was filed with the Securities and Exchange
Commission on March 16, 2016. The Company disclaims any
intention or obligation to revise any forward-looking statements,
whether as a result of new information, future events or
otherwise.
DAWSON GEOPHYSICAL
COMPANY
|
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
30,067,000
|
|
$
|
55,130,000
|
|
$
|
133,330,000
|
|
$
|
234,685,000
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
27,458,000
|
|
|
47,181,000
|
|
|
121,661,000
|
|
|
205,566,000
|
General
and administrative
|
|
3,575,000
|
|
|
4,587,000
|
|
|
16,822,000
|
|
|
22,729,000
|
Depreciation and amortization
|
|
10,316,000
|
|
|
11,503,000
|
|
|
44,283,000
|
|
|
47,072,000
|
|
|
41,349,000
|
|
|
63,271,000
|
|
|
182,766,000
|
|
|
275,367,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(11,282,000)
|
|
|
(8,141,000)
|
|
|
(49,436,000)
|
|
|
(40,682,000)
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
121,000
|
|
|
75,000
|
|
|
347,000
|
|
|
159,000
|
Interest
expense
|
|
(21,000)
|
|
|
(117,000)
|
|
|
(260,000)
|
|
|
(609,000)
|
Other
income
|
|
1,279,000
|
|
|
583,000
|
|
|
3,108,000
|
|
|
1,098,000
|
Loss before income
tax
|
|
(9,903,000)
|
|
|
(7,600,000)
|
|
|
(46,241,000)
|
|
|
(40,034,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
|
2,716,000
|
|
|
2,660,000
|
|
|
6,449,000
|
|
|
13,755,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
$
|
(7,187,000)
|
|
$
|
(4,940,000)
|
|
$
|
(39,792,000)
|
|
$
|
(26,279,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
(loss) income:
|
|
|
|
|
|
|
|
|
|
|
|
Net
unrealized (loss) income on foreign exchange rate translation,
net
|
$
|
(194,000)
|
|
$
|
(516,000)
|
|
$
|
228,000
|
|
$
|
(1,480,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss
|
$
|
(7,381,000)
|
|
$
|
(5,456,000)
|
|
$
|
(39,564,000)
|
|
$
|
(27,759,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic loss per
share attributable to common stock
|
$
|
(0.33)
|
|
$
|
(0.23)
|
|
$
|
(1.84)
|
|
$
|
(1.27)
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share attributable to common stock
|
$
|
(0.33)
|
|
$
|
(0.23)
|
|
$
|
(1.84)
|
|
$
|
(1.27)
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
equivalent common shares outstanding
|
|
21,636,869
|
|
|
21,590,943
|
|
|
21,611,562
|
|
|
20,688,185
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
equivalent common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
-
assuming dilution
|
|
21,636,869
|
|
|
21,590,943
|
|
|
21,611,562
|
|
|
20,688,185
|
DAWSON GEOPHYSICAL
COMPANY
|
CONSOLIDATED BALANCE
SHEETS
|
|
December
31,
|
|
December
31,
|
ASSETS
|
2016
|
|
2015
|
|
(unaudited)
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and
cash equivalents
|
$
|
14,624,000
|
|
$
|
37,009,000
|
Short-term investments
|
|
40,250,000
|
|
|
21,000,000
|
Accounts receivable, net of
allowance for doubtful accounts of $250,000 at December 31, 2016 and 2015
|
|
16,031,000
|
|
|
35,700,000
|
Prepaid
expenses and other assets
|
|
4,822,000
|
|
|
6,150,000
|
|
|
|
|
|
|
Total current assets
|
|
75,727,000
|
|
|
99,859,000
|
|
|
|
|
|
|
Property and
equipment
|
|
324,950,000
|
|
|
345,619,000
|
Less
accumulated depreciation
|
|
(214,033,000)
|
|
|
(198,052,000)
|
|
|
|
|
|
|
Net property and equipment
|
|
110,917,000
|
|
|
147,567,000
|
|
|
|
|
|
|
Intangibles
|
|
487,000
|
|
|
361,000
|
|
|
|
|
|
|
Long-term deferred
tax liabilities, net
|
|
535,000
|
|
|
-
|
|
|
|
|
|
|
Total assets
|
$
|
187,666,000
|
|
$
|
247,787,000
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
$
|
5,617,000
|
|
$
|
8,401,000
|
Accrued
liabilities:
|
|
|
|
|
|
Payroll costs and
other taxes
|
|
885,000
|
|
|
1,074,000
|
Other
|
|
2,983,000
|
|
|
4,604,000
|
Deferred
revenue
|
|
3,155,000
|
|
|
6,146,000
|
Current
maturities of notes payable and obligations under capital
leases
|
|
2,357,000
|
|
|
8,585,000
|
|
|
|
|
|
|
Total current liabilities
|
|
14,997,000
|
|
|
28,810,000
|
|
|
|
|
|
|
Long-term
liabilities:
|
|
|
|
|
|
Notes payable and obligations under capital leases less current
maturities
|
|
-
|
|
|
2,106,000
|
Deferred tax liabilities, net
|
|
146,000
|
|
|
5,319,000
|
Other accrued liabilities
|
|
1,639,000
|
|
|
1,834,000
|
|
|
|
|
|
|
Total long-term liabilities
|
|
1,785,000
|
|
|
9,259,000
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
Preferred stock-par value $1.00 per share; 4,000,000 shares
authorized, none
outstanding
|
|
-
|
|
|
-
|
|
|
|
|
|
|
Common
stock-par value $0.01 per share; 35,000,000 shares authorized,
21,704,851 and 21,629,310 shares issued, and 21,656,406 and
21,580,865 shares outstanding at December 31, 2016 and 2015,
respectively
|
|
217,000
|
|
|
216,000
|
Additional paid-in capital
|
|
142,998,000
|
|
|
142,269,000
|
Retained
earnings
|
|
29,265,000
|
|
|
69,057,000
|
Treasury
stock, at cost; 48,445 shares at December 31, 2016 and
2015
|
|
-
|
|
|
-
|
Accumulated other comprehensive loss, net
|
|
(1,596,000)
|
|
|
(1,824,000)
|
|
|
|
|
|
|
Total stockholders' equity
|
|
170,884,000
|
|
|
209,718,000
|
|
|
|
|
|
|
Total liabilities and stockholders' equity
|
$
|
187,666,000
|
|
$
|
247,787,000
|
Reconciliation of
EBITDA to Net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
2015
|
|
|
2016
|
2015
|
|
|
(in
thousands)
|
|
|
(in
thousands)
|
Net loss
|
$
|
(7,187)
|
|
$
|
(4,940)
|
|
$
|
(39,792)
|
|
$
|
(26,279)
|
Depreciation and
amortization
|
|
10,316
|
|
|
11,503
|
|
|
44,283
|
|
|
47,072
|
Interest (income)
expense, net
|
|
(100)
|
|
|
42
|
|
|
(87)
|
|
|
450
|
Income tax
benefit
|
|
(2,716)
|
|
|
(2,660)
|
|
|
(6,449)
|
|
|
(13,755)
|
EBITDA
|
$
|
313
|
|
$
|
3,945
|
|
$
|
(2,045)
|
|
$
|
7,488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
EBITDA to Net Cash (Used in) Provided by Operating
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
2015
|
|
|
2016
|
2015
|
|
|
(in
thousands)
|
|
|
(in
thousands)
|
Net cash (used in)
provided by operating activities
|
$
|
(5,684)
|
|
$
|
2,734
|
|
$
|
8,742
|
|
$
|
20,612
|
Changes in working
capital and other items
|
|
6,205
|
|
|
1,573
|
|
|
(9,908)
|
|
|
(11,968)
|
Noncash adjustments
to net loss
|
|
(208)
|
|
|
(362)
|
|
|
(879)
|
|
|
(1,156)
|
EBITDA
|
$
|
313
|
|
$
|
3,945
|
|
$
|
(2,045)
|
|
$
|
7,488
|
Pro Forma Information
The following unaudited pro forma condensed financial
information for the twelve months ended December 31, 2015
gives effect to the Merger as if it had occurred on January l,
2015. The unaudited pro forma condensed financial information has
been included for comparative purposes only and is not necessarily
indicative of the results that might have occurred had the
transactions taken place on the dates indicated and is not intended
to be a projection of future results. The unaudited pro forma
financial information reflects certain adjustments related to the
acquisition, such as (1) to record certain incremental
expenses resulting from purchase accounting adjustments, such as
reduced depreciation expense in connection with the fair value
adjustments to property and equipment; and (2) to record the
related tax effects. Shares used in the calculations of earnings
per share in the table below were 21,537,480 for the year ended
December 31, 2015.
Pro Forma
Table
|
|
|
|
|
Year
Ended
|
|
|
December
31,
|
|
|
2015
|
Pro forma total
revenues
|
|
$
248,295,000
|
Pro forma net
loss
|
|
$
(30,256,000)
|
Pro forma net loss
per share:
|
|
|
Basic
|
|
$
(1.40)
|
Diluted
|
|
$
(1.40)
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dawson-geophysical-reports-fourth-quarter-and-full-year-2016-results-300416499.html
SOURCE Dawson Geophysical Company