HOUSTON, Oct. 23 /PRNewswire-FirstCall/ -- Universal Compression Holdings,
Inc. (NYSE: UCO), a leading provider of natural gas compression services,
today reported fiscal 2004 second quarter net income of $9.6 million, or
$0.31 per diluted share, before charges in the quarter of $0.4 million on a
pretax basis or $0.01 per diluted share on an after-tax basis, related to
previously announced facility consolidation costs. Including the charges, the
Company had net income of $9.3 million, or $0.30 per diluted share. In the
fiscal 2004 first quarter, net income before charges related to debt
extinguishment and facility consolidation costs was $7.7 million, or $0.25 per
diluted share; including the charges, the Company had a net loss of
$2.0 million, or $0.06 per diluted share in the first quarter. In the fiscal
2003 second quarter, net income was $7.7 million, or $0.25 per diluted share.
Revenues were $175.7 million in the fiscal 2004 second quarter compared to
$152.2 million in the fiscal 2004 first quarter and $154.6 million in the
prior year period. EBITDA, as adjusted (as defined below), was $55.3 million
in the fiscal 2004 second quarter compared to $52.5 million in the fiscal 2004
first quarter and $48.2 million in the fiscal 2003 second quarter.
"Revenues increased 15% over first quarter levels due to higher customer
demand in the United States, Latin America, Canada and Asia Pacific. Our
contract compression, fabrication and aftermarket services segments each
contributed to this strong performance. We expect to continue to benefit from
increasing fleet activity levels and favorable business conditions in the
second half of fiscal 2004," said Stephen A. Snider, Universal's President and
Chief Executive Officer.
"We continue to reactivate idle contract compression units as a key
element of our goal to enhance financial returns, and have made both operating
and capital expenditures in these fleet units to enhance long-term operating
efficiency. Although our domestic contract compression profitability was
negatively impacted by this activity in the second quarter, we expect
profitability to improve in the third quarter. Capital expenditures were
approximately $21 million in the second quarter compared to $17 million in the
first quarter and $33 million in the prior year period," added Michael
Anderson, Universal's Chief Financial Officer.
Guidance
For the three months ending December 31, 2003, the Company expects
revenues to be $165 million to $175 million and earnings per diluted share to
be $0.30 to $0.34. For the twelve months ending March 31, 2004, the Company
expects revenues of $670 million to $700 million and earnings per diluted
share of $1.22 to $1.32, excluding the charges related to debt extinguishment
and facility consolidation costs. Including these charges, the Company
expects earnings per diluted share of $0.90 to $1.00 in fiscal 2004. The
Company expects capital expenditures will be $90 million to $110 million in
fiscal 2004 and that operating cash flow after capital expenditures will be
positive.
Second Quarter Statistics
-- Average fleet horsepower utilized was 2,026,000 in the second quarter
compared to 1,981,000 in the first quarter and 1,884,000 in the prior
year period. Spot utilization was 87% at September 30, 2003 compared
to 85% at June 30, 2003 and 82% at September 30, 2002. Average
utilization was 86% in the second quarter, 84% in the first quarter
and 83% in the prior year period.
-- Domestic contract compression gross margins were 61% in the second
quarter compared to 64% in the first quarter and 63% in the prior year
period. International contract compression gross margins were 77%
compared to 79% in the first quarter and 80% in the prior year period.
-- Total contract compression horsepower was 2,346,000 at
September 30, 2003 compared to 2,367,000 at June 30, 2003 and
2,297,000 at September 30, 2002. International contract compression
horsepower was 410,000 at September 30, 2003 compared to 407,000 at
June 30, 2003 and 363,000 at September 30, 2002.
-- Fabrication revenues were $49.7 million compared to $29.3 million in
the first quarter and $42.1 million in the prior year period;
fabrication gross margins were 11% compared to 1% in the prior quarter
and 11% in the prior year period. Fabrication backlog was $101
million at September 30, 2003 compared to $81 million at June 30, 2003
and $87 million at September 30, 2002.
-- Aftermarket services revenues were $35.6 million compared to
$34.1 million in the first quarter and $30.8 million in the prior year
period. Aftermarket services gross margins were 22% in the second
quarter, 23% in the first quarter and 19% in the prior year period.
Conference Call
Universal will host a conference call today, October 23, 2003 at 10:00 am
Central Time, 11:00 am Eastern Time, to discuss the quarter's results and
other corporate matters. The conference call will be broadcast over the
Internet to provide interested persons the opportunity to listen to it live.
The call will also be archived for approximately 90 days to provide an
opportunity to those unable to listen to the live broadcast. Both the live
broadcast and replay of the archived version are free of charge to the user.
Persons wishing to listen to the conference call live may do so by logging
onto http://www.universalcompression.com (click "Company Overview" in the
"Company Information" section) or
http://www.firstcallevents.com/service/ajwz389466725gf12.html at least
15 minutes prior to the start of the call. A replay of the call will remain
available at the Web sites www.universalcompression.com and
http://www.prnewswire.com for approximately 90 days.
EBITDA, as adjusted, is defined as net income plus income taxes, interest
expense (including debt extinguishment costs), operating lease expense,
depreciation and amortization, foreign currency gains or losses, excluding
non-recurring items (including facility consolidation costs), and
extraordinary gains or losses. Beginning with the quarter ended
September 30, 2002, the Company changed its definition of EBITDA, as adjusted,
to exclude foreign currency gains or losses. All periods prior to
September 30, 2002 have been recalculated from amounts previously disclosed by
the Company to be consistent with this new definition of EBITDA, as adjusted.
Universal Compression, headquartered in Houston, Texas, is a leading
natural gas compression services company, providing a full range of contract
compression, sales, operations, maintenance and fabrication services to the
domestic and international natural gas industry.
Statements about Universal's outlook and all other statements in this
release other than historical facts are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements rely on a number of assumptions concerning future
events and are subject to a number of uncertainties and factors, many of which
are outside Universal's control, which could cause actual results to differ
materially from such statements. While Universal believes that the
assumptions concerning future events are reasonable, it cautions that there
are inherent difficulties in predicting certain important factors that could
impact the future performance or results of its business. Among the important
factors that could cause actual results to differ materially from those
indicated by such forward-looking statements are the demand for Universal's
products and services and worldwide economic and political conditions. These
and other risk factors are discussed in Universal's filings with the
Securities and Exchange Commission, copies of which are available to the
public. Universal expressly disclaims any intention or obligation to revise
or update any forward-looking statements whether as a result of new
information, future events, or otherwise.
UNIVERSAL COMPRESSION HOLDINGS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS
(In thousands, except per share amounts)
Three Months Ended
September 30, June 30, September 30,
2003 2003 2002
Revenues:
Domestic contract compression $ 69,716 $ 69,199 $ 65,122
International contract
compression 20,720 19,684 16,643
Fabrication 49,678 29,260 42,064
Aftermarket services 35,568 34,084 30,753
Total revenues 175,682 152,227 154,582
Costs and expenses:
Domestic contract compression -
direct costs 26,965 24,624 24,020
International contract
compression - direct costs 4,812 4,199 3,376
Fabrication - direct costs 44,113 29,056 37,579
Aftermarket services - direct
costs 27,880 26,149 24,791
Depreciation and amortization 20,915 20,986 14,311
Selling, general and
administrative 17,324 15,926 17,238
Operating lease --- --- 15,485
Interest expense 17,960 19,918 4,792
Debt extinguishment costs --- 14,397 ---
Foreign currency (gain) loss 884 (1,049) 1,139
Other (income) (714) (181) (602)
Facility consolidation costs 417 1,404 ---
Total costs and expenses 160,556 155,429 142,129
Income (loss) before income taxes 15,126 (3,202) 12,453
Income taxes (benefit) 5,823 (1,233) 4,794
Net income (loss) $ 9,303 $ (1,969) $ 7,659
Weighted average common and common
equivalent shares outstanding:
Basic 30,797 30,775 30,661
Diluted 31,108 30,775 30,863
Earnings (loss) per share:
Basic $ 0.30 $ (0.06) $ 0.25
Diluted $ 0.30 $ (0.06) $ 0.25
UNAUDITED SUPPLEMENTAL INFORMATION
(Dollars in thousands)
Three Months Ended
September 30, June 30, September 30,
2003 2003 2002
Revenues:
Domestic contract compression $ 69,716 $ 69,199 $ 65,122
International contract
compression 20,720 19,684 16,643
Fabrication 49,678 29,260 42,064
Aftermarket services 35,568 34,084 30,753
Total $175,682 $152,227 $154,582
Gross Profit:
Domestic contract compression $ 42,751 $ 44,575 $ 41,102
International contract
compression 15,908 15,485 13,267
Fabrication 5,565 204 4,485
Aftermarket services 7,688 7,935 5,962
Total $ 71,912 $ 68,199 $ 64,816
Selling, General and Administrative $ 17,324 $ 15,926 $ 17,238
% of Revenue 10% 10% 11%
EBITDA, as adjusted * $ 55,302 $ 52,454 $ 48,180
% of Revenue 31% 34% 31%
Capital Expenditures $ 20,577 $ 16,743 $ 32,880
Average Utilization 86% 84% 83%
Profit Margin:
Domestic contract compression 61% 64% 63%
International contract compression 77% 79% 80%
Fabrication 11% 1% 11%
Aftermarket services 22% 23% 19%
Total 41% 45% 42%
Reconciliation of GAAP to Non-GAAP
Financial Information:
Net income $ 9,303 $(1,969) $7,659
Income taxes (benefit) 5,823 (1,233) 4,794
Depreciation and amortization 20,915 20,986 14,311
Operating lease --- --- 15,485
Interest expense 17,960 19,918 4,792
Debt extinguishment costs --- 14,397 ---
Foreign currency (gain) loss 884 (1,049) 1,139
Facility consolidation costs 417 1,404 ---
EBITDA, as adjusted * $55,302 $52,454 $48,180
September 30, June 30, September 30,
2003 2003 2002
Debt ** $889,673 $890,179 $231,322
Operating Leases $ --- $ --- $708,500
Stockholders' Equity $762,866 $750,514 $708,073
Total Debt to Capitalization *** 53.8% 54.3% 57.0%
* Beginning with the quarter ended September 30, 2002, the Company
changed its definition of EBITDA, as adjusted, to exclude foreign
currency gains or losses. All periods prior to September 30, 2002
have been recalculated from amounts previously disclosed by the
Company to be consistent with this new definition of EBITDA, as
adjusted.
** Debt includes capital lease obligations.
*** Total Debt includes Debt and Operating Leases.
SOURCE Universal Compression Holdings, Inc.