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Oil States Announces Fourth Quarter Earnings

Stocks in this article: OIS

Oil States International, Inc. is a diversified oilfield services company and is a leading integrated provider of remote site accommodations with prominent market positions in the Canadian oil sands and the Australian mining regions. Oil States is also a leading manufacturer of products for deepwater production facilities and subsea pipelines as well as a provider of completion-related rental tools, oil country tubular goods distribution and land drilling services to the oil and gas industry. Oil States is publicly traded on the New York Stock Exchange under the symbol OIS.

For more information on the Company, please visit Oil States International's website at http://www.oilstatesintl.com .

The Oil States International, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6058

The foregoing contains forward-looking statements within the meaning of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently subject to risks and uncertainties. The forward-looking statements included therein are based on then current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Such risks and uncertainties include, among other things, risks associated with the general nature of the oilfield service industry and other factors discussed in the "Business" and "Risk Factors" sections of the Form 10-K for the year ended December 31, 2011 filed by Oil States with the SEC on February 17, 2012 and the "Risk Factors" section of the form 10-Q for the three months ended September 30, 2012 filed by Oil States with the SEC on November 2, 2012.

 
Oil States International, Inc.
Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited, unless otherwise noted)
         
  Three Months Ended December 31, Twelve Months Ended December 31,
  2012 2011 2012 2011
         (audited) 
 Revenues  $1,142,336 $995,801 $4,413,088 $3,479,180
 Costs and expenses:         
 Cost of sales and services   863,975  742,236  3,292,969  2,599,267
 Selling, general and administrative expenses   55,750  50,532  203,651  182,434
 Depreciation and amortization expense   65,775  50,828  230,098  188,147
 Other operating expense /(income)   888  (915)  2,590  1,809
 Operating income   155,948  153,120  683,780  507,523
         
 Interest expense   (17,305)  (17,966)  (68,922)  (57,506)
 Interest income   604  278  1,583  1,700
 Equity in earnings (loss) of unconsolidated affiliates   (427)  (11)  243  (163)
 Other income   1,681  1,998  10,211  3,515
 Income before income taxes   140,501  137,419  626,895  455,069
 Income tax expense   (41,710)  (42,890)  (177,047)  (131,647)
 Net income   98,791  94,529  449,848  323,422
 Less: Net income attributable to noncontrolling interest   272  247  1,239  969
 Net income attributable to Oil States International, Inc.  $98,519 $94,282 $448,609 $322,453
         
 Net income per share         
 Basic  $1.80 $1.84 $8.47 $6.30
 Diluted  $1.78 $1.72 $8.10 $5.86
         
 Weighted average number of common shares outstanding         
 Basic   54,794  51,222  52,959  51,163
 Diluted   55,362  54,946  55,384  55,007
 
 
OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES
 
CONSOLIDATED BALANCE SHEETS
(in thousands)
 
   December 31, 
   2012   2011 
ASSETS
Current assets:    
Cash and cash equivalents  $ 253,172  $ 71,721
Accounts receivable, net  832,785  732,240
Inventories, net  701,496  653,698
Prepaid expenses and other current assets   38,639   32,000
Total current assets  1,826,092  1,489,659
     
Property, plant and equipment, net  1,852,126  1,557,088
Goodwill, net  520,818  467,450
Other intangible assets, net  146,103  127,602
Other noncurrent assets   94,823   61,842
Total assets  $ 4,439,962  $ 3,703,641
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:    
Accounts payable  $ 279,933  $ 252,209
Accrued liabilities  107,906  96,748
Income taxes  29,588  10,395
Current portion of long-term debt and capitalized leases   30,480  34,435
Deferred revenue  66,311  75,497
Other current liabilities   4,314   5,665
Total current liabilities  518,532  474,949
     
Long-term debt and capitalized leases (1)  1,279,805  1,142,505
Deferred income taxes  129,235  97,377
Other noncurrent liabilities   46,590   25,538
Total liabilities  1,974,162  1,740,369
     
Stockholders' equity:    
Oil States International, Inc. stockholders' equity:    
Common stock, $.01 par value, 200,000,000 shares authorized, 58,488,299 shares and 54,803,539 shares issued, respectively, and 54,695,473 shares and 51,288,750 shares outstanding, respectively   585 548
Additional paid-in capital  586,070  545,730
Retained earnings  1,899,195  1,450,586
Accumulated other comprehensive income  107,097  74,371
Common stock held in treasury at cost, 3,792,826 and 3,514,789 shares, respectively (128,542) (109,079)
Total Oil States International, Inc. stockholders' equity   2,464,405   1,962,156
Noncontrolling interest   1,395   1,116
Total stockholders' equity   2,465,800   1,963,272
Total liabilities and stockholders' equity  $ 4,439,962  $ 3,703,641

(1) As of December 31, 2012, the Company had approximately $973 million available under its credit facilities.  

 
OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 
  Year Ended December 31,
   2012   2011 
Cash flows from operating activities:    
Net income $ 449,848 $ 323,422
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization  230,098  188,147
Deferred income tax provision  17,370  27,075
Excess tax benefits from share-based payment arrangements  (8,164)  (8,583)
Non-cash compensation charge  18,904  14,565
Gains on disposals of assets  (8,600)  (3,614)
Accretion of debt discount  4,106  7,786
Amortization of deferred financing costs  7,301  6,497
Other, net  1,535  960
Changes in operating assets and liabilities, net of effect from acquired businesses:    
Accounts receivable  (83,379)  (260,186)
Inventories  (34,182)  (154,290)
Accounts payable and accrued liabilities  30,697  47,610
Taxes payable  17,960  24,789
Other current assets and liabilities, net  (6,011)  1,735
Net cash flows provided by operating activities  637,483  215,913
  Cash flows from investing activities:    
Capital expenditures, including capitalized interest  (487,937)  (487,482)
Acquisitions of businesses, net of cash acquired  (80,449)  (2,412)
Proceeds from disposition of property, plant and equipment  14,653  5,949
Deposits held in escrow related to acquisitions of businesses  (20,000)  --
Other, net  (3,244)  (5,010)
Net cash flows used in investing activities  (576,977)  (488,955)
  Cash flows from financing activities:    
Revolving credit repayments, net  (64,251)  (316,736)
6 1/2 % senior notes issued  --  600,000
Payment of principal on 2 3/8% Notes conversion  (174,990)  (10)
5 1/8 % senior notes issued  400,000  --
Term loan repayments  (30,047)  (14,972)
Debt and capital lease repayments  (4,569)  (2,529)
Issuance of common stock from share based payment arrangements  13,628  14,154
Purchase of treasury stock  (15,245)  (12,632)
Excess tax benefits from share based payment arrangements  8,164  8,583
Payment of financing costs  (7,914)  (13,464)
Tax withholdings related to net share settlements of restricted stock  (4,218)  (2,702)
Other, net  --  (1,804)
Net cash flows provided by financing activities  120,558  257,888
  Effect of exchange rate changes on cash    680    (9,332)
Net increase (decrease) in cash and cash equivalents from continuing operations continuing operations  181,744  (24,486)
Net cash used in discontinued operations – operating activities  (293)  (143)
Cash and cash equivalents, beginning of year  71,721  96,350
     
Cash and cash equivalents, end of year $ 253,172 $ 71,721
     
 
Oil States International, Inc.
Segment Data
(in thousands)
(unaudited)
         
  Three Months Ended December 31, Twelve Months Ended December 31,
  2012 2011 2012 2011
         
 Revenues         
 Completion services  $131,233 $140,535 $522,618 $487,941
 Drilling services   41,177  46,250  191,034  165,903
 Well site services   172,410  186,785  713,652  653,844
 Accommodations   277,369  236,876  1,113,470  864,701
 Offshore products   237,259  186,111  804,067  585,818
 Tubular services   455,298  386,029  1,781,899  1,374,817
 Total revenues  $1,142,336 $995,801 $4,413,088 $3,479,180
         
 EBITDA (A)         
 Completion services  $43,679 $49,659 $176,755 $162,537
 Drilling services (1)   12,194  8,944  57,839  40,686
 Well site services   55,873  58,603  234,594  203,223
 Accommodations (2)   119,476  102,516  505,894  361,156
 Offshore products   40,428  37,505  149,377  107,376
 Tubular services (3)   18,977  17,271  78,948  67,283
 Corporate and eliminations   (12,049)  (10,207)  (45,720)  (40,985)
 Total EBITDA  $222,705 $205,688 $923,093 $698,053
         
 Operating income / (loss)         
 Completion services  $29,634 $38,416 $124,620 $120,849
 Drilling services   6,400  3,816  32,160  20,394
 Well site services   36,034  42,232  156,780  141,243
 Accommodations (2)   77,265  70,525  364,629  248,977
 Offshore products   36,935  34,292  134,051  94,666
 Tubular services (3)   18,052  16,486  75,042  64,422
 Corporate and eliminations   (12,338)  (10,415)  (46,722)  (41,785)
 Total operating income  $155,948 $153,120 $683,780 $507,523

(1) The EBITDA of our drilling business for the twelve months ended December 31, 2012 includes a pre-tax gain of $2.5 million related to insurance proceeds received during the second quarter for the land drilling rig that was lost in a fire.     

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