Helix Completes Acquisition of Remington and Revises Earnings Guidance; Transferring Listing to New York Stock Exchange
03 7월 2006 - 11:00PM
PR Newswire (US)
HOUSTON, July 3 /PRNewswire-FirstCall/ -- Helix Energy Solutions
Group, Inc. (NASDAQ:HELX) today announced that it has completed its
acquisition of Remington Oil & Gas following approval by
Remington's stockholders last week. As a result of the merger, each
share of Remington common stock has been converted into the right
to receive $27.00 in cash and 0.436 shares of Helix common stock.
Information regarding exchange of share certificates will be sent
to Remington stockholders as soon as practicable. To fund the cash
portion of the merger consideration Helix entered into an $835
million Senior Secured Term B facility which amortizes 1% per year
with a balloon payment due at the end of seven years. Interest
floats at LIBOR plus 200 and the facility is prepayable without
penalty. Helix also terminated its existing $150 million revolver
and entered into a new Senior Secured $300 million five year
revolver. Earnings Guidance As a result of this acquisition and the
continued strength of the Contracting Services businesses we are
increasing our estimated 2006 earnings to a range of $3.20 to $3.70
per diluted share. In addition, we estimate 2007 earnings will be
between $4.00 to $5.50 per diluted share. See attached "Key
Variables" for general range of assumptions embedded in the
earnings estimates. Transfer to New York Stock Exchange Beginning
the morning of Tuesday, July 18th, 2006, Helix will transfer its
listing from the NASDAQ and begin trading on the New York Stock
Exchange under the ticker symbol HLX. Stock Buyback Program The
Company's Board of Directors has authorized the Company to
discretionarily purchase up to $50 million of Helix common stock in
the open market. Owen Kratz, Chairman and Chief Executive Officer,
stated, "We are extremely pleased to have closed the Remington
transaction, which is immediately accretive to earnings and
provides a pipeline of high quality prospects to help fuel future
growth. Due to the acquisition and further strengthening of the
market for our contracting services we are increasing our earnings
guidance for 2006 to a range with a mid-point 23% higher than that
of our original estimate. Also, we are anticipating between 15 -
60% of earnings growth next year. "We should generate over $1.5
billion of operating cash flow from now until the end of 2007,
which will allow us to pursue exciting growth opportunities in the
contracting services segment; enhance reserves and production; and
reduce debt, as well as fund share repurchases. "With respect to
the NYSE transfer this is a move we have contemplated for some
time. With the name change earlier this year and the closing of the
Remington acquisition, a NYSE listed company, the timing is right.
We are greatly appreciative of the support we have received from
NASDAQ; however, we believe that this is the right move at the
right time for our company and shareholders." Further details will
be provided in a presentation and conference call on Tuesday, July
11th at 9:00 am Central Daylight Time. The call will be webcast
live and can be accessed, along with the presentation, at the
Investor Relations page of http://www.helixesg.com/. A replay will
be available from the Audio Archives page. Helix Energy Solutions
is an energy services company that provides innovative solutions to
the oil and gas industry worldwide for marginal field development,
alternative development plans, field life extension and
abandonment, with service lines including diving services, shelf
and deepwater construction, robotics, well operations, well
engineering and subsurface consulting services, platform ownership
and oil and gas production. For more information, go to
http://www.helixesg.com/. Forward-Looking Statements This press
release and attached presentation contain forward-looking
statements that involve risks, uncertainties and assumptions that
could cause our results to differ materially from those expressed
or implied by such forward-looking statements. All statements,
other than statements of historical fact, are statements that could
be deemed "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, including,
without limitation, any projections of revenue, gross margin,
expenses, earnings or losses from operations, or other financial
items; future production volumes, results of exploration,
exploitation, development, acquisition and operations expenditures,
and prospective reserve levels of property or wells; any statements
of the plans, strategies and objectives of management for future
operations; any statement concerning developments, performance or
industry rankings relating to services; any statements regarding
future economic conditions or performance; any statements of
expectation or belief; any statements regarding the anticipated
results (financial or otherwise) of the merger of Remington Oil and
Gas Corporation into a wholly-owned subsidiary of Helix; and any
statements of assumptions underlying any of the foregoing. The
risks, uncertainties and assumptions referred to above include the
performance of contracts by suppliers, customers and partners;
employee management issues; complexities of global political and
economic developments, geologic risks and other risks described
from time to time in our reports filed with the Securities and
Exchange Commission ("SEC"), including the Company's Annual Report
on Form 10-K for the year ending December 31, 2005; and, with
respect to the Remington merger, actual results could differ
materially from Helix's expectations depending on factors such as
the combined company's cost of capital, the ability of the combined
company to identify and implement cost savings, synergies and
efficiencies in the time frame needed to achieve these
expectations, prior contractual commitments of the combined
companies and their ability to terminate these commitments or
amend, renegotiate or settle the same, the combined company's
actual capital needs, the absence of any material incident of
property damage or other hazard that could affect the need to
effect capital expenditures, any unforeseen merger or acquisition
opportunities that could affect capital needs, the costs incurred
in implementing synergies and the factors that generally affect
both Helix's and Remington's respective businesses. Actual actions
that the combined company may take may differ from time to time as
the combined company may deem necessary or advisable in the best
interest of the combined company and its shareholders to attempt to
achieve the successful integration of the companies, the synergies
needed to make the transaction a financial success and to react to
the economy and the combined company's market for its exploration
and production. We assume no obligation and do not intend to update
these forward-looking statements. Key Variables 2006 2007
Contracting Services: Low High Low High Revenues (millions) $900
$1,000 $1,000 $1,100 EBITDA Margins (1) 35 % 40 % 35 % 40%
Production Facilities: Equity in Earnings (millions) $20 $24 $45
$55 Oil & Gas: Oil Price (per bbl) $60.00 $70.00 $55.00 Strip
($72.64) Natural Gas Price (per mcf) $5.00 $7.00 $6.00 Strip
($9.18) Production (BcFe) 57 62.5 90.5 109.5 Corporate: SG&A %
of Revenue 9 % 8 % 10 % 8% Effective Tax Rate 35 % 34 % 35 % 34%
Average Shares Outstanding (millions) 91 90 98 96 CAPEX (millions)
(2) $960 $1,000 $625 $1,000 (1) See GAAP reconciliation at
http://www.helixesg.com/. (2) Does not include Remington
acquisition amount. Helix Energy Solutions Group, Inc.
Reconciliation of Non GAAP Measures Press Release - July 3, 2006
Contracting Services EBITDA Margins: 2006 2007 Low High Low High
(in thousands, except percentages) Income from operations $252,000
$337,000 $272,000 $363,000 Plus: Equity in earnings of investment
4,000 4,000 5,000 5,000 Plus: Depreciation and amortization 63,000
63,000 77,000 77,000 EBITDA $319,000 $404,000 $354,000 $445,000
Revenues $900,000 $1,000,000 $1,000,000 $1,100,000 EBITDA Margin
(EBITDA /Revenues) 35% 40% 35% 40% DATASOURCE: Helix Energy
Solutions Group, Inc. CONTACT: Wade Pursell, Chief Financial
Officer of Helix Energy Solutions Group, Inc., +1-281-618-0400, or
fax, +1-281-618-0505 Web site: http://www.helixesg.com/
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