Dawson Geophysical Reports Fiscal First Quarter 2014 Results And Commencement Of Quarterly Dividend Policy

Dawson Geophysical Reports Fiscal First Quarter 2014 Results And Commencement
                         Of Quarterly Dividend Policy

PR Newswire

MIDLAND, Texas, Feb. 4, 2014

MIDLAND, Texas, Feb.4, 2014 /PRNewswire/ --Dawson Geophysical Company
(NASDAQ: DWSN) today reported revenues of $68,181,000 for the quarter ended
December 31, 2013, the Company's first quarter of fiscal 2014, as compared to
$76,629,000 for the same quarter of fiscal 2013. The Company reported a net
loss of $2,897,000 for the first quarter of fiscal 2014, or $0.36 per share
attributable to common stock, as compared to net income of $2,928,000, or
$0.36 per share attributable to common stock, in the same quarter of fiscal
2013. EBITDA for the first quarter of fiscal 2014 was $4,860,000 compared to
$14,338,000 for the same quarter of fiscal 2013.

On February 3, 2014, the Company's Board of Directors approved the
commencement of the payment of an $0.08 per share quarterly cash dividend to
shareholders, subject to capital availability and a determination that cash
dividends continue to be in the best interest of the Company. The Board of
Directors has set the first such quarterly dividend to be payable on February
24, 2014 to shareholders of record at the close of business on February 14,
2014 (the "record date"). The declared amount represents an aggregate dividend
of approximately $645,000 based on the number of issued and outstanding shares
of Common Stock as of the declaration date, or approximately $2,580,000 on an
annualized basis. The Board of Directors may from time to time, in conjunction
with management, evaluate supplemental dividend payments depending on the
Company's financial results, capital requirements and overall market
conditions.

Fiscal First Quarter 2014 Highlights

  oCompany returned to full deployment of twelve data acquisition crews in
    mid-November;
  oCrew utilization rates are back at full capacity following extreme weather
    conditions in areas of operations in the United States and Canada, which
    had a significant negative impact on the Company's operations;
  oInterest levels for operations related to microseismic projects continue
    to increase;
  oOrder book has strengthened to a level consistent with commitments carried
    over the past twelve months despite the slowdown in bid activity during
    the summer of 2013 as reported in the Company's year-end earnings release;
  oThe Company took delivery of 9,000 stations of GSX three-channel units
    complete with three-component geophones;
  oThe Company anticipates operating a large channel count multi-component
    crew in the United States for a significant portion of fiscal 2014;
  oThe Company plans to maintain its previously disclosed $35,000,000 capital
    budget for fiscal 2014 with the unspent balance dedicated primarily to
    maintenance capital requirements, including replacement of light vehicles
    and batteries for recording equipment; and
  oBalance sheet strength remains strong with approximately $66,000,000 of
    working capital and approximately $20,000,000 of debt, of which
    approximately $11,000,000 will be paid over the next twelve months.

Revenues for the first quarter of fiscal 2014, historically the Company's most
difficult quarter with shorter daylight hours and the holiday season,
decreased compared to the first fiscal quarter of 2013 primarily as a result
of previously disclosed significantly reduced utilization rates for the first
half of the quarter and severe cold and inclement weather conditions in many
areas of the Company's operations in both the United States and Canada during
the second half of the quarter, which negatively impacted crew productivity.
Utilization rates for the first half of the first quarter of fiscal 2014 were
at or below fifty percent. In addition, the Company's operating expenses for
the first quarter of fiscal 2014 increased relative to revenue primarily as
the result of costs related to the return to full utilization in the United
States and higher than anticipated United States and Canadian project start-up
costs and equipment rental expense.

Stephen Jumper, President, Chief Executive Officer and Chairman of the
Company, said, "Without a doubt, the quarter ended December 31, 2013 had its
challenges. Low utilization rates and severe weather conditions negatively
impacted our results. Activity levels in the Canadian seismic market were
softer than anticipated and costs related to the return to full utilization in
the United States were high. Despite these challenges, we returned to full
deployment of all twelve large data acquisition crews in mid-November. All
twelve crews have been fully deployed since that time and utilization levels
of these crews are now at full capacity. Our outlook for the United States,
our primary area of operation, for fiscal 2014 remains positive with steady
demand and utilization of twelve large crews anticipated."

Demand for the Company's services remains steady. The Company's order book has
strengthened to a level consistent with commitments carried over the past
twelve months despite the slowdown in bid activity during the summer of 2013
as reported in the Company's year-end earnings release and is sufficient to
maintain full utilization until the middle of calendar 2014. While the
Company's clients may cancel, delay or alter the scope of their agreements on
short notice and the Company's operations may be impacted by weather
conditions or land access delays, the Company anticipates demand levels to
support operation of its twelve large crews at full utilization through fiscal
2014.

The Company is currently operating one crew in Canada for the 2013-2014 winter
season with two large channel count multi-component projects under contract.
Demand in Canada was softer than anticipated for the second consecutive
season. In addition, during the 2013-2014 winter season, the Company's
Canadian operations experienced higher than anticipated costs and operational
difficulties primarily related to extreme cold and excessive snowfall in its
current area of operation. The Company's Canadian operations had an overall
negative impact on the Company's first quarter of fiscal 2014 financial
results and is anticipated to have a negative impact on the Company's second
fiscal quarter.

While the Company did not conduct any operations related to microseismic
projects during the December 31, 2013 quarter, the interest level for such
projects continues to increase. The Company anticipates securing contracts to
complete several microseismic projects primarily utilizing the small crew
during the remainder of fiscal 2014 and continues to pursue microseismic
opportunities in both the United States and Canada.

Capital expenditures for the quarter ended December 31, 2013 were $24,188,000.
As previously reported, the Company took delivery of 9,000 stations of GSX
three-channel units complete with three-component geophones. These units
combined with the Company's existing units are deployed on large
multi-component projects in North Dakota and Canada. The Company anticipates
operating a large channel count multi-component crew in the United States for
a significant portion of fiscal 2014. The Company recently completed a
multi-component project in West Texas utilizing leased recording equipment and
Company owned multi-component vibrator energy source units. Interest levels
for multi-component projects in the United States and Canada continue to
increase. The Company anticipates maintaining its previously disclosed
$35,000,000 capital budget for fiscal 2014 with the unspent balance of the
capital budget dedicated primarily to maintenance capital requirements,
including replacement of light vehicles and batteries for recording equipment.

The Company's balance sheet remains strong with approximately $66,000,000 of
working capital and approximately $20,000,000 of debt, of which approximately
$11,000,000 will be paid over the next twelve months. Cash balances decreased
significantly during the first quarter of fiscal 2014 primarily as a result of
capital expenditures during the quarter, working capital requirements and an
increase in accounts receivables. The Company continues to maintain a fully
available $20,000,000 revolving line of credit.

Jumper concluded, "We are pleased that our Board has implemented the payment
of a quarterly dividend in order to reward our loyal shareholders and increase
shareholder value. The Company's cash flow generation provides us with the
ability to return capital to shareholders while maintaining the level of
capital investment necessary to grow our business over the long term. We will
continue to evaluate from time to time supplemental dividend payments
depending on market conditions, financial performance and capital needs in an
effort to increase returns for shareholders."

Conference Call Information

Dawson will host a conference call to review its fiscal first quarter 2014
financial results on February 4, 2014, at 9 a.m. CST. Participants can access
the call at (877)418-5260 (US), 1-866-605-3852 (Canada) or (412)717-9589
(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 Friday, February 7, 2014 by dialing
(877)344-7529 (US/Canada) or (412)317-0088 (International). The passcode is
10039918. The webcast will be recorded and available for replay on Dawson's
website until March 4, 2014.

About Dawson

Dawson Geophysical Company is a leading provider of onshore seismic data
acquisition services in the lower 48 states of the United States and Canada.
Founded in 1952, 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.

Forward-Looking Statements

In accordance with the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995, Dawson Geophysical 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. These risks
include but are not limited to the volatility of oil and natural gas prices,
dependence upon energy industry spending, disruptions in the global economy,
industry competition, delays, reductions or cancellations of service
contracts, high fixed costs of operations, external factors affecting our
crews such as weather interruptions and inability to obtain land access rights
of way, whether we enter into turnkey or term contracts, crew productivity,
limited number of customers, credit risk related to our customers, the
availability of capital resources and operational disruptions. A discussion of
these and other factors, including risks and uncertainties, is set forth in
the Company's Form 10-K for the fiscal year-ended September30, 2013. Dawson
Geophysical Company disclaims any intention or obligation to revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.

Non-GAAP Financial Measures

This press release contains 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 (loss)
income plus interest expense, interest income, income taxes, depreciation and
amortization expense. The Company uses EBITDA as a supplemental financial
measure to assess:

  othe financial performance of its assets without regard to financing
    methods, capital structures, taxes or historical cost basis;
  oits 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
  othe 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 (loss) income, 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, depreciation and amortization. A reconciliation of the Company's EBITDA
to its net (loss) income is presented in the table following the text of this
press release.





DAWSON GEOPHYSICAL COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
                                     Three Months Ended December 31,
                                     2013                    2012
                                     (Unaudited)             (Unaudited)
Operating revenues                   $   68,181,000        $  76,629,000
Operating costs:
 Operating expenses                59,108,000              58,735,000
 General and administrative        4,164,000               3,596,000
 Depreciation                      9,876,000               9,104,000
                                     73,148,000              71,435,000
(Loss) income from operations        (4,967,000)             5,194,000
Other income (expense):
 Interest income                   17,000                  16,000
 Interest expense                  (135,000)               (191,000)
 Other (expense) income           (49,000)                40,000
(Loss) income before income tax      (5,134,000)             5,059,000
Income tax benefit (expense)         2,237,000               (2,131,000)
Net (loss) income                    $   (2,897,000)      $    2,928,000
Basic (loss) income per share        $        (0.36)  $       
attributable to common stock                                 0.36
Diluted (loss) income per share      $        (0.36)  $       
attributable to common stock                                 0.36
Weighted average equivalent common   7,956,215               7,849,525
shares outstanding
Weighted average equivalent common
shares outstanding
 -assuming dilution                7,956,215               7,876,338



DAWSON GEOPHYSICAL COMPANY
CONSOLIDATED BALANCE SHEETS
                                              December 31,       September 30,
                                              2013               2013
                                              (Unaudited)
ASSETS
Current assets:
 Cash and cash equivalents                  $   11,860,000  $ 52,405,000
 Short-term investments                     26,000,000         23,500,000
 Accounts receivable, net of allowance for
doubtful accounts of $250,000 at December 31, 55,647,000         37,488,000
2013 and September 30, 2013
 Prepaid expenses and other assets          4,271,000          737,000
 Current deferred tax asset                 1,592,000          1,664,000
 Total current assets           99,370,000         115,794,000
Property, plant and equipment                 348,603,000        325,464,000
 Less accumulated depreciation              (161,301,000)      (152,231,000)
 Net property, plant and equipment 187,302,000        173,233,000
 Total assets                   $  286,672,000   $289,027,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Accounts payable                           $   11,905,000  $ 15,880,000
 Accrued liabilities:
 Payroll costs and other taxes           3,401,000          1,850,000
 Other                                   3,565,000          6,154,000
 Deferred revenue                           2,985,000          3,438,000
 Current maturities of notes payable and    11,108,000         9,258,000
obligationsunder capital leases
 Total current liabilities      32,964,000         36,580,000
Long-term liabilities:
 Notes payable and obligations under       9,328,000          3,697,000
capital leasesless current maturities
 Deferred tax liability                    33,800,000         35,690,000
 Total long-term liabilities    43,128,000         39,387,000
Commitments and contingencies
Stockholders' equity:
 Preferred stock-par value $1.00 per
share;5,000,000 shares authorized, none      -                  -
outstanding
 Common stock-par value $.33 1/3 per share;
50,000,000 shares authorized, 8,063,208 and
8,056,943 shares issued and outstanding       2,688,000          2,686,000
atDecember 31, 2013 and September 30, 2013,
respectively
 Additional paid-in capital                 95,261,000         94,846,000
 Retained earnings                         112,631,000        115,528,000
 Total stockholders' equity     210,580,000        213,060,000
 Total liabilities and          $  286,672,000   $289,027,000
stockholders' equity



Reconciliation of EBITDA to Net (Loss) Income
                                                        Three Months Ended
                                                        December 31,
                                                        2013         2012
                                                        (in thousands)
Net (loss) income                                      $  (2,897)  $  2,928
Depreciation                                            9,876        9,104
Interest expense (income), net                          118          175
Income tax (benefit) expense                           (2,237)      2,131
EBITDA                                                  $   4,860  $ 14,338
Reconciliation of EBITDA to Net Cash Provided (Used) by
Operating Activities                                    Three Months Ended
                                                        December 31,
                                                        2013         2012
                                                        (in thousands)
Net cash (used) provided by operating activities        $ (21,709)   $  9,014
Changes in working capital and other items              26,973       5,964
Noncash adjustments to income                           (404)        (640)
EBITDA                                                  $   4,860  $ 14,338







SOURCE Dawson Geophysical Company

Website: http://www.dawson3d.com
Contact: Stephen C. Jumper, CEO and President, Christina W. Hagan, Chief
Financial Officer, (800) 332-9766, www.dawson3d.com
 
Press spacebar to pause and continue. Press esc to stop.