Hercules Offshore Announces Third Quarter 2012 Results

            Hercules Offshore Announces Third Quarter 2012 Results

PR Newswire

HOUSTON, Oct. 25, 2012

HOUSTON, Oct. 25, 2012 /PRNewswire/ --Hercules Offshore, Inc. (Nasdaq: HERO)
today reported a loss from continuing operations of $37.9 million, or $0.24
per diluted share, on revenue of $184.9 million for the third quarter 2012,
compared with a loss from continuing operations of $17.0 million, or $0.12 per
diluted share, on revenue of $163.0 million for the third quarter 2011. As
outlined in the Reconciliation of GAAP to Non-GAAP Financial Measures, third
quarter 2012 results include the following pre-tax items:

  oNon-cash charge of $60.7 million to reflect the impairment of the Hercules
    252 and Hercules 258;
  oGain from the sale of Platform Rig 3 and related entities of $18.4
    million; and
  oGain from the insurance settlement on the Hercules 185 of $27.3 million.

On an after-tax basis, these items approximated $22.1 million, or $0.14 per
diluted share.

John T. Rynd, Chief Executive Officer and President of Hercules Offshore
stated, "Visibility in our Domestic Offshore segment is the best it has been
since the company's formation, driven by solid demand and tight supply of
jackup rigs in the U.S. Gulf of Mexico. We believe this positive momentum will
continue through at least 2013 based on our discussions with customers, many
of whom are seeking longer term commitments than what we have traditionally
seen in the U.S. Gulf of Mexico.

"We continue to rationalize and optimize our global asset base. This includes
the favorable insurance settlement on the Hercules 185, along with the sale of
our non-core platform rig in Mexico and two cold stacked units in the U.S.
during the third quarter. We also sold a third cold stacked rig, the Hercules
252, in early October, which prompted an impairment charge in the third
quarter. Consistent with our fleet optimization efforts, we have elected to
cold stack and impair the book value of the Hercules 258 in Malaysia.

"As we close out 2012, the exceptional visibility in our domestic business, in
addition to having over $270 million of cash on the balance sheet, leaves us
well-positioned to take advantage of attractive growth opportunities and
further enhance our credit profile."

Offshore

Domestic Offshore revenue for the third quarter 2012 increased by 53.2% to
$92.3 million from $60.2 million in the third quarter 2011, as both dayrates
and utilization have risen substantially over the past year driven by strong
fundamentals in the region. Average revenue per rig per day improved by 28.8%
to $63,203 for the third quarter 2012 compared to $49,060 in the third quarter
2011, while utilization increased to 88.2% from 74.2% in the same periods,
respectively. Operating expenses increased to $62.3 million in the third
quarter 2012 from $53.2 million in the respective 2011 period, primarily on
higher labor and repair and maintenance costs. In addition, third quarter 2011
operating expenses were reduced by approximately $2.9 million of gains from
asset sales. Overall, Domestic Offshore generated an operating loss of $16.4
million in the third quarter 2012, which includes an impairment charge of
$25.5 million on the cold stacked rig Hercules 252, as compared to an
operating loss of $12.8 million in the third quarter 2011.

International Offshore revenue declined to $37.1 million in the third quarter
2012 from $49.0 million in the third quarter 2011. Operating days declined to
393 days in the third quarter 2012 from 508 days in the same prior year
period, primarily due to the absence of the Hercules 185 and contract
expiration on the Hercules 258. Average revenue per rig per day of $94,377 in
the third quarter 2012 was slightly lower than $96,388 in the comparable prior
year period. Third quarter 2012 operating expenses include the benefit from
(i) the insurance settlement gain on the Hercules 185 of $27.3 million and
(ii) the gain from the sale of Platform Rig 3 of $18.4 million. International
Offshore recorded operating income of $3.5 million in the third quarter 2012,
which includes an impairment charge of $35.2 million on the cold stacked rig
Hercules 258 and the aforementioned gains, compared to operating income of
$12.9 million in the comparable 2011 period.

Inland

During the third quarter 2012, Inland generated revenue of $7.4 million
compared to revenue of $8.1 million in the third quarter 2011. Average revenue
per rig per day increased by 3.7% to $32,153 during the third quarter 2012,
from $31,008 during the third quarter 2011. Utilization declined to 83.0% in
the third quarter 2012 from 94.9% in the respective prior year period. Third
quarter 2012 operating expenses increased to $6.7 million, from $3.5 million
in the third quarter 2011, largely due to higher workers' compensation expense
and lower gains from asset sales. Prior year period operating expenses include
the benefit of $2.6 million in net gains from asset sales, compared to gains
of $1.3 million during the third quarter 2012. Inland recorded an operating
loss of $2.8 million in the third quarter 2012 compared to operating income of
$0.9 million in the third quarter 2011, including the aforementioned gains.

Liftboats

Domestic Liftboats revenue increasedto $17.4 million in the third quarter
2012 from $16.7 million in the third quarter 2011, as higher average dayrates
were largely offset by fewer operating days. Average revenue per liftboat per
day increased by 19.2% to $8,870 during the third quarter 2012, from $7,443 in
the prior year period. Operating days decreased to 1,958 in the third quarter
2012, compared to 2,246 operating days during the third quarter 2011.
Operating days were negatively impacted by Hurricane Isaac and a reduction in
the number of marketed vessels as a result of an international mobilization, a
casualty loss on the Starfish, and the cold stacking of one vessel. Third
quarter 2012 operating expenses declined to $9.9 million from $11.4 million
during the comparable period of 2011, due to lower workers' compensation and
various expenses related to a reduction in the number of marketed vessels.
Domestic Liftboats recorded operating income of $2.6 million in the third
quarter 2012 compared to operating income of $0.6 million in the third quarter
2011.

International Liftboats generated revenue of $30.8 million in the third
quarter 2012 compared to $28.9 million in the third quarter 2011. Average
revenue per liftboat per day increased by 9.9% to $23,432 in the third quarter
2012 from $21,325 in the same period in 2011. Operating days were relatively
constant at 1,314 during the third quarter 2012, compared to 1,357 days in the
third quarter 2011. Third quarter 2012 operating expenses increased to $20.4
million, from $14.1 million during the third quarter 2011, primarily due to
incremental costs associated with the repair of the Whaleshark and
mobilization of the Kingfish to the Middle East, in addition to higher labor
and repair and maintenance expenses. International Liftboats recorded
operating income of $6.5 million in the third quarter 2012 compared to
operating income of $8.5 million in the prior year period.

Non-GAAP

Certain non-GAAP performance measures and corresponding reconciliations to
GAAP financial measures for the Company have been provided for meaningful
comparisons between current results and prior operating periods. Generally, a
non-GAAP financial measure is a numerical measure of a company's performance,
financial position, or cash flows that excludes or includes amounts that are
not normally excluded or included in the most directly comparable measure
calculated and presented in accordance with generally accepted accounting
principles. In order to fully assess the financial operating results,
management believes that the adjusted loss from continuing operations figures
included in this release are appropriate measures of the continuing and normal
operations of the Company. However, these measures should be considered in
addition to, and not as a substitute for, or superior to, income (loss) from
continuing operations, operating income (loss), cash flows from operations, or
other measures of financial performance prepared in accordance with GAAP. The
non-GAAP measures included in this press release have been reconciled to the
nearest GAAP measure in the table that follows the financial statements.
Please see the attached Reconciliation of GAAP to Non-GAAP Financial Measures
for a complete description of the adjustments made to Operating Loss, Loss
From Continuing Operations and Diluted Loss per Share from Continuing
Operations.

Conference Call Information

Hercules Offshore will conduct a conference call at 10:00 a.m. CDT (11:00 a.m.
EDT) on October 25, 2012, to discuss its third quarter 2012 financial results.
To participate in the call, dial 866-277-1184 (domestic) or 617-597-5360
(international) and reference access code 24477667 approximately 10 minutes
prior to the start of the call. The conference call will also be broadcast
live via the Internet at http://www.herculesoffshore.com.

A replay of the conference call will be available by telephone on October 25,
2012, beginning at 12:00 p.m. CDT (1:00 p.m. EDT), through November 1, 2012.
The phone number for the conference call replay is 888-286-8010 (domestic) or
617-801-6888 (international) with access code 57392118. Additionally, the
recorded conference call will be accessible through our website at
http://www.herculesoffshore.com for 7 days after the conference call.

Additional Information

Headquartered in Houston, Hercules Offshore, Inc. operates a fleet of 39
jackup rigs, 16 barge rigs, 63 liftboats and two submersible rigs. The Company
offers a range of services to oil and gas producers to meet their needs during
drilling, well service, platform inspection, maintenance, and decommissioning
operations in several key shallow water provinces around the world. Hercules
Offshore currently holds 32.1% of share capital in Discovery Offshore S.A., a
pure play, ultra-high specification jackup rig company. For more information,
please visit our website at http://www.herculesoffshore.com.

The news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Such statements are subject to a number of risks,
uncertainties and assumptions, including the factors described in Hercules
Offshore's most recent periodic reports and other documents filed with the
Securities and Exchange Commission, which are available free of charge at the
SEC's website at http://www.sec.gov or the Company's website at
http://www.herculesoffshore.com. Hercules Offshore cautions you that
forward-looking statements are not guarantees of future performance and that
actual results or developments may differ materially from those projected or
implied in these statements.



HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
                                           September 30,      December 31,
                                           2012               2011
                                           (Unaudited)
ASSETS
 Current Assets:
  Cash and Cash Equivalents                $    271,550   $    134,351
  Restricted Cash                          3,994              9,633
  Accounts Receivable, Net                 152,037            153,688
  Prepaids                                 24,675             16,352
  Current Deferred Tax Asset               15,536             15,543
  Assets Held for Sale                     7,840              -
  Other                                    11,322             20,435
                                           486,954            350,002
 Property and Equipment, Net               1,464,165          1,591,791
 Equity Investment                         38,460             34,735
 Other Assets, Net                         39,833             30,176
                                           $   2,029,412    $  2,006,704
LIABILITIES AND STOCKHOLDERS' EQUITY
 Current Liabilities:
  Short-term Debt and Current Portion of   $     66,335  $     22,130
  Long-term Debt
  Accounts Payable                         57,652             49,370
  Accrued Liabilities                      70,143             70,421
  Interest Payable                         36,120             9,899
  Insurance Notes Payable                  18,165             5,218
  Other Current Liabilities                30,467             18,366
                                           278,882            175,404
 Long-term Debt, Net of Current Portion    797,797            818,146
 Deferred Income Taxes                     51,379             83,503
 Other Liabilities                         24,108             21,098
 Commitments and Contingencies
 Stockholders' Equity                      877,246            908,553
                                           $   2,029,412    $  2,006,704



HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
                                  Three Months Ended       Nine Months Ended
                                  September 30,            September 30,
                                  2012       2011          2012       2011
Revenue                           $        $  162,991  $        $ 
                                  184,888                  507,158    492,570
Costs and Expenses:
   Operating Expenses             85,608     111,372       317,934    332,081
   Asset Impairment               60,693     -             108,216    -
   Depreciation and Amortization  40,805     43,895        126,178    128,699
   General and Administrative     15,738     10,757        39,925     40,403
                                  202,844    166,024       592,253    501,183
Operating Loss                    (17,956)   (3,033)       (85,095)   (8,613)
Other Income (Expense):
   Interest Expense               (19,869)   (20,389)      (59,831)   (59,035)
   Loss on Extinguishment of      -          -             (9,156)    -
   Debt
   Other, Net                     676        (1,595)       764        (3,263)
Loss Before Income Taxes          (37,149)   (25,017)      (153,318)  (70,911)
Income Tax Benefit (Provision)    (709)      7,973         22,047     25,921
Loss from Continuing Operations   (37,858)   (17,044)      (131,271)  (44,990)
Income (Loss) from Discontinued   -          52            -          (9,651)
Operations, Net of Taxes
Net Loss                          $         $            $         $  
                                  (37,858)  (16,992)     (131,271)  (54,641)
Basic and Diluted Loss Per
Share:
   Loss from Continuing           $      $         $      $   
   Operations                     (0.24)     (0.12)        (0.86)    (0.35)
   Income (Loss) from             -          -             -          (0.08)
   Discontinued Operations
   Net Loss                       $      $         $      $   
                                  (0.24)     (0.12)        (0.86)    (0.43)
Basic and Diluted Weighted        158,573    137,887       152,098    128,000
Average Shares Outstanding





HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
                                             Nine Months Ended September 30,
                                             2012              2011
Cash Flows from Operating Activities:
 Net Loss                                    $   (131,271)  $   (54,641)
 Adjustments to Reconcile Net Loss to Net
 Cash Provided by
 Operating Activities:
 Depreciation and Amortization               126,178           130,355
 Stock-Based Compensation Expense            5,141             3,898
 Deferred Income Taxes                       (33,120)          (47,458)
 Benefit for Doubtful Accounts Receivable    (8,841)           (12,240)
 Amortization of Deferred Financing Fees     2,450             2,877
 Amortization of Original Issue Discount     3,187             3,305
 Gain on Insurance Settlement                (30,668)          -
 (Gain) Loss on Disposal of Assets, Net      (24,563)          5,495
 Non-Cash Portion of Loss on Extinguishment  2,738             -
 of Debt
 Asset Impairment                            108,216           -
 Other                                       (838)             2,868
 Net Change in Operating Assets and          40,604            23,908
 Liabilities
 Net Cash Provided by Operating Activities   59,213            58,367
Cash Flows from Investing Activities:
 Acquisition of Assets                       (40,000)          (25,000)
 Additions of Property and Equipment         (82,150)          (33,508)
 Deferred Drydocking Expenditures            (9,814)           (12,859)
 Cash Paid for Equity Investment             (4,288)           (34,155)
 Insurance Proceeds Received                 54,139            -
 Proceeds from Sale of Assets, Net           49,854            58,440
 (Increase) Decrease in Restricted Cash      1,621             (2,476)
 Net Cash Used in Investing Activities       (30,638)          (49,558)
Cash Flows from Financing Activities:
 Long-term Debt Borrowings                   500,000           -
 Long-term Debt Repayments                   (452,909)         (18,615)
 Redemption of 3.375% Convertible Senior     (27,606)          -
 Notes
 Common Stock Issuance                       96,696            -
 Payment of Debt Issuance Costs              (7,717)           (2,109)
 Other                                       160               2,523
 Net Cash Provided by (Used in) Financing    108,624           (18,201)
 Activities
Net Increase (Decrease) in Cash and Cash     137,199           (9,392)
Equivalents
Cash and Cash Equivalents at Beginning of    134,351           136,666
Period
Cash and Cash Equivalents at End of Period   $    271,550   $   127,274





HERCULES OFFSHORE, INC. AND SUBSIDIARIES
SELECTED FINANCIAL AND OPERATING DATA
(Dollars in thousands, except per day amounts)
(Unaudited)
                         Three Months Ended         Nine Months Ended
                         September 30,              September 30,
                         2012         2011          2012           2011
Domestic Offshore:
 Number of rigs (as of   34           43            34             43
 end of period)
 Revenue                 $  92,277   $  60,246    $ 264,663     $ 142,688
 Operating expenses      62,343       53,184        177,746        140,390
 Asset impairment        25,502       -             25,502         -
 Depreciation and        18,695       17,977        54,966         49,920
 amortization expense
 General and
 administrative          2,099        1,909         5,936          7,499
 expenses
 Operating income        $ (16,362)   $ (12,824)    $     513  $ (55,121)
 (loss)
International Offshore:
 Number of rigs (as of   8            9             8              9
 end of period)
 Revenue                 $  37,090   $  48,965    $  85,210    $ 196,131
 Operating expenses      (13,816)     29,098        39,061         99,803
 Asset impairment        35,191       -             82,714         -
 Depreciation and        10,360       12,913        35,087         39,469
 amortization expense
 General and
 administrative          1,842        (5,992)       (2,682)        (6,968)
 expenses
 Operating income        $   3,513  $  12,946    $  (68,970)   $  63,827
 (loss)
Inland:
 Number of barges (as    16           17            16             17
 of end of period)
 Revenue                 $   7,363  $   8,124   $  19,907    $  21,251
 Operating expenses      6,749        3,535         20,963         16,693
 Depreciation and        3,217        3,310         9,634          11,338
 amortization expense
 General and
 administrative          231          356           407            869
 expenses
 Operating income        $  (2,834)  $    923  $  (11,097)   $  (7,649)
 (loss)
Domestic Liftboats:
 Number of liftboats     39           41            39             41
 (as of end of period)
 Revenue                 $  17,368   $  16,718    $  44,041    $  44,209
 Operating expenses      9,931        11,419        29,561         31,837
 Depreciation and        4,042        4,136         11,682         11,637
 amortization expense
 General and
 administrative          821          548           1,963          1,579
 expenses
 Operating income        $   2,574  $    615  $     835  $  
 (loss)                                                            (844)
International
Liftboats:
 Number of liftboats     24           24            24             24
 (as of end of period)
 Revenue                 $  30,790   $  28,938    $  93,337    $  88,291
 Operating expenses      20,401       14,136        50,603         43,358
 Depreciation and        3,819        4,905         12,872         14,379
 amortization expense
 General and
 administrative          72           1,374         2,855          4,470
 expenses
 Operating income        $   6,498  $   8,523   $  27,007    $  26,084
Total Company:
 Revenue                 $ 184,888    $ 162,991     $ 507,158     $ 492,570
 Operating expenses      85,608       111,372       317,934        332,081
 Asset impairment        60,693       -             108,216        -
 Depreciation and        40,805       43,895        126,178        128,699
 amortization expense
 General and
 administrative          15,738       10,757        39,925         40,403
 expenses
 Operating loss          (17,956)     (3,033)       (85,095)       (8,613)
  Interest expense   (19,869)     (20,389)      (59,831)       (59,035)
  Loss on            -            -             (9,156)        -
 extinguishment of debt
  Other, net         676          (1,595)       764            (3,263)
 Loss before income      (37,149)     (25,017)      (153,318)      (70,911)
 taxes
  Income tax         (709)        7,973         22,047         25,921
 benefit (provision)
 Loss from continuing    (37,858)     (17,044)      (131,271)      (44,990)
 operations
 Income (loss) from
 discontinued            -            52            -              (9,651)
 operations, net of
 taxes
 Net loss                $ (37,858)   $ (16,992)    $ (131,271)    $ (54,641)





HERCULES OFFSHORE, INC. AND SUBSIDIARIES
SELECTED FINANCIAL AND OPERATING DATA - (Continued)
(Dollars in thousands, except per day amounts)
(Unaudited)
                         Three Months Ended September 30, 2012
                                                                     Average
                                                            Average
                                                                     Operating
                         Operating  Available  Utilization  Revenue
                         Days       Days       (1)                   Expense
                                                            per Day  per
                                                            (2)
                                                                     Day (3)
 Domestic Offshore       1,460      1,656      88.2%        $     $    
                                                            63,203    37,647
 International Offshore  393        602        65.3%        94,377   (22,950)
 Inland                  229        276        83.0%        32,153   24,453
 Domestic Liftboats      1,958      2,944      66.5%        8,870    3,373
 International Liftboats 1,314      1,932      68.0%        23,432   10,560
                         Three Months Ended September 30, 2011
                                                                     Average
                                                            Average
                                                                     Operating
                         Operating  Available  Utilization  Revenue
                         Days       Days       (1)                   Expense
                                                            per Day  per
                                                            (2)
                                                                     Day (3)
 Domestic Offshore       1,228      1,656      74.2%        $     $    
                                                            49,060    32,116
 International Offshore  508        736        69.0%        96,388   39,535
 Inland                  262        276        94.9%        31,008   12,808
 Domestic Liftboats      2,246      3,220      69.8%        7,443    3,546
 International Liftboats 1,357      2,116      64.1%        21,325   6,681
                         Nine Months Ended September 30, 2012
                                                                     Average
                                                            Average
                                                                     Operating
                         Operating  Available  Utilization  Revenue
                         Days       Days       (1)                   Expense
                                                            per Day  per
                                                            (2)
                                                                     Day (3)
 Domestic Offshore       4,414      4,932      89.5%        $     $    
                                                            59,960    36,039
 International Offshore  969        1,876      51.7%        87,936   20,821
 Inland                  633        822        77.0%        31,449   25,502
 Domestic Liftboats      5,193      8,997      57.7%        8,481    3,286
 International Liftboats 3,895      5,594      69.6%        23,963   9,046
                         Nine Months Ended September 30, 2011
                                                                     Average
                                                            Average
                                                                     Operating
                         Operating  Available  Utilization  Revenue
                         Days       Days       (1)                   Expense
                                                            per Day  per
                                                            (2)
                                                                     Day (3)
 Domestic Offshore       3,075      4,099      75.0%        $     $    
                                                            46,403    34,250
 International Offshore  1,654      2,184      75.7%        118,580  45,697
 Inland                  739        819        90.2%        28,756   20,382
 Domestic Liftboats      5,676      9,855      57.6%        7,789    3,231
 International Liftboats 4,022      6,279      64.1%        21,952   6,905

    Utilization is defined as the total number of days our rigs or liftboats,
    as applicable, were under contract, known as operating days, in the period
    as a percentage of the total number of available days in the period. Days
(1) during which our rigs and liftboats were undergoing major refurbishments,
    upgrades or construction, and days during which our rigs and liftboats are
    cold stacked, are not counted as available days. Days during which our
    liftboats are in the shipyard undergoing drydocking or inspection are
    considered available days for the purposes of calculating utilization.
    Average revenue per rig or liftboat per day is defined as revenue earned
(2) by our rigs or liftboats, as applicable, in the period divided by the
    total number of operating days for our rigs or liftboats, as applicable,
    in the period.
    Average operating expense per rig or liftboat per day is defined as
    operating expenses, excluding depreciation and amortization, incurred by
    our rigs or liftboats, as applicable, in the period divided by the total
    number of available days in the period. We use available days to
    calculate average operating expense per rig or liftboat per day rather
(3) than operating days, which are used to calculate average revenue per rig
    or liftboat per day, because we incur operating expenses on our rigs and
    liftboats even when they are not under contract and earning a dayrate. In
    addition, the operating expenses we incur on our rigs and liftboats per
    day when they are not under contract are typically lower than the per day
    expenses we incur when they are under contract.



Hercules Offshore, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands, except per share data)
We report our financial results in accordance with generally accepted
accounting principles (GAAP). However, management believes that certain
non-GAAP performance measures and ratios may provide users of this financial
information additional meaningful comparisons between current results and
results in prior operating periods. Non-GAAP financial measures we may present
from time to time are operating income, income from continuing operations or
diluted earnings per share excluding certain charges or amounts. These
adjusted income amounts are not a measure of financial performance under GAAP.
Accordingly, they should not be considered as a substitute for operating
income, income from continuing operations, net income, earnings per share or
other income data prepared in accordance with GAAP. See the table below for
supplemental financial data and corresponding reconciliations to GAAP
financial measures for the three and nine months ended September 30, 2012.
Non-GAAP financial measures should be viewed in addition to, and not as an
alternative for, the Company's reported results prepared in accordance with
GAAP. The non-GAAP measures included in this press release have been
reconciled to the nearest GAAP measure in the following table:

                               Three Months Ended       Nine Months Ended

                               September 30,            September 30,
                               2012^                   2012^
 Operating Loss:
 GAAP Operating Loss      $                $       
                               (17,956)                 (85,095)
 Adjustment               15,075              (a)  62,598            (b)
 Non-GAAP Operating Loss  $               $       
                               (2,881)                  (22,497)
 Other Expense:
 GAAP Other Expense       $                $       
                               (19,193)                 (68,223)
 Adjustment               -                        9,156             (c)
 Non-GAAP Other           $                $       
Expense                      (19,193)                 (59,067)
 Benefit (Provision) for
Income Taxes:
 GAAP Benefit             $               $        
(Provision) for Income Taxes    (709)                 22,047
 Tax Impact of            7,042                    (12,796)
Adjustment
 Non-GAAP Benefit         $               $        
(Provision) for Income Taxes    6,333                   9,251
 Loss from Continuing
Operations:
 GAAP Loss from           $                $      
Continuing Operations          (37,858)                 (131,271)
 Total Adjustment, Net    22,117                   58,958
of Tax
 Non-GAAP Loss from       $                $       
Continuing Operations          (15,741)                 (72,313)
 Diluted Loss per Share
from Continuing Operations:
 GAAP Diluted Loss per    $               $        
Share from Continuing           (0.24)                  (0.86)
Operations
 Adjustment per Share     0.14                     0.38
 Non-GAAP Diluted Loss    $               $        
per Share from Continuing       (0.10)                  (0.48)
Operations

    This amount represents a non-cash charge of $35.2 million related to the
    impairment of the Hercules 258; a non-cash charge of $25.5 million related
(a) tothe impairment of the Hercules 252; an $18.4 million gain on the sale
    of Platform Rig 3 and a $27.3 million gain on the Hercules 185 insurance
    settlement. On anafter-tax basis, these adjustments approximated $22.1
    million.
    This amount represents a non-cash charge of $47.5 million related to the
    impairment of the Hercules 185 and related unamortized deferred costs; a
    non-cash charge of $35.2 million related to the impairment of the Hercules
(b) 258; a non-cash charge of $25.5 million related to the impairment of the
    Hercules 252; an $18.4 million gain on the sale of Platform Rig 3 and a
    $27.3 million gain on the Hercules 185 insurance settlement. On an
    after-tax basis, these adjustments approximated $53.0 million.
    This amount represents (i) a charge of $6.4 million related to our debt
    refinancing in April 2012; (ii) a non-cash charge of $1.4 million related
(c) to the write-off of unamortized issuance costs in connection with the
    April 2012 termination of our prior term loan and (iii) a $1.3 million
    loss on the retirement of a portion of our 3.375% convertible senior
    notes. On an after-tax basis, these adjustments approximated $6.0 million.

SOURCE Hercules Offshore, Inc.

Website: http://www.herculesoffshore.com
Contact: Son P. Vann, CFA, Vice President Investor Relations and Planning,
Hercules Offshore, Inc., +1-713-350-8508
 
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