Newpark Resources Reports 2013 Fourth Quarter And Full Year Results

     Newpark Resources Reports 2013 Fourth Quarter And Full Year Results

Reports fourth quarter 2013 net income of $0.14 per diluted share

Increases share repurchase authorization from $50 million to $100 million

PR Newswire

THE WOODLANDS, Texas, Feb. 13, 2014

THE WOODLANDS, Texas, Feb. 13, 2014 /PRNewswire/ --Newpark Resources, Inc.
(NYSE: NR) today announced results for its fourth quarter and year ended
December 31, 2013. Total revenues for the fourth quarter of 2013 were $262.5
million compared to $270.3 million in the fourth quarter of 2012. Net income
for the fourth quarter of 2013 was $13.5 million, or $0.14 per diluted share,
compared to $11.2 million, or $0.12 per diluted share, in the fourth quarter
of 2012.

Fourth quarter 2013 results include a pre-tax gain of $2.7 million ($0.02 per
diluted share) associated with the sale of assets within the U.S.-based
completion services business. In addition, the fourth quarter was negatively
impacted by a tax rate of 40%, primarily driven by operating losses generated
in Brazil during the quarter, for which the recording of a tax benefit is not
permitted. Brazil's fourth quarter results also include $1.0 million ($0.01
per diluted share) of charges for value added tax assessments and
restructuring charges.

For the full year 2013, total revenues were $1.107 billion compared to $1.038
billion in 2012. Net income for 2013 was $65.3 million, or $0.69 per diluted
share, compared to $60.0 million, or $0.62 per diluted share, in 2012.

Paul Howes, Newpark's President and Chief Executive Officer, stated, "We
produced a record year in terms of revenues and cash flow, in spite of
challenges we faced in our drilling fluids segment during the fourth quarter.
Fourth quarter results were negatively impacted primarily by reduced activity
with four key customers across three regions. In the U.S, we also experienced
a slowdown in customer activity in November and December, partly due to
difficult weather conditions, as well as year-end budget constraints by some
customers. Outside of the U.S., Canada experienced the anticipated seasonal
improvement, while the temporary weakness in the EMEA region this quarter was
expected. Brazil's unfavorable sales mix was unexpected in the fourth
quarter, and we are taking steps to manage through a tougher environment
there.

"Moving to the operational highlights, we recently signed a new four year
contract with Cairn Energy valued at approximately $40 million to deliver
drilling fluids products and solids control equipment into India starting in
the second half of 2014. Also, we are pleased with our progress on Evolution,
with fourth quarter revenues reaching a new record of $34 million, bringing
full year Evolution revenues to $120 million. Our Evolution products are
experiencing success both domestically and internationally, and we have
completed several successful wells in the international arena.

"Additionally, our mats segment produced another strong performance, with
rental revenues reaching another quarterly record, benefitting from increased
usage of our mats through all phases of exploration. Rental revenues
increased nearly 50% from a year ago and 5% sequentially. We also completed
an acquisition in the U.K. during the fourth quarter, a significant step in
our strategy to expand our mat rental business in the international market.
This acquisition brings us a base of operations from which to expand into
the European market. As we have stated previously, we desire to diversify
our mats business outside the U.S. market where we see growth opportunities.
This acquisition is also important as it will serve to help fill the capacity
of our new manufacturing facility that is nearing the construction phase.

"In summary, we are pleased to report another record revenue and cash flow
year, while at the same time returning capital to shareholders to enhance
shareholder value," concluded Howes.

ACQUISITIONS AND DIVESTITURES

The Company announced the acquisition of Terrafirma Roadways ("Terrafirma"), a
provider of temporary roadways and worksites based in the United Kingdom. The
acquisition was completed in December 2013 for total cash consideration of
$6.8 million. Prior to the acquisition, Terrafirma had been operating as a
partner to Newpark since 2008 in developing a rental business with Durabase®
composite mats, primarily focused in the utility industry in the U.K.

The Company also announced that the divesture of the U.S.-based completion
services business was completed during the fourth quarter. The completion
services business generated $3.3 million of revenues and $2.6 million of
operating income during the fourth quarter of 2013, including a $2.7 million
gain on the sale of assets.

As previously announced, subsequent to the fourth quarter, Newpark entered
into a definitive agreement to sell its Environmental Services business to
ecoserv, LLC. Under the terms of the agreement, Newpark will receive $100
million in cash, subject to adjustment based on working capital conveyed at
closing.

SHARE REPURCHASE PROGRAM AUTHORIZATION INCREASED TO $100 MILLION

Subject to completion of the Environmental Services divestiture, the Company's
Board of Directors has amended the previously announced $50 million share
repurchase program, doubling the repurchase authorization to $100 million.
Since the program's original authorization in April of 2013, a total of 1.4
million outstanding shares of Newpark common stock have been repurchased to
date, at an average cost of $12.00 per share.

SEGMENT RESULTS

The Fluids Systems segment generated revenues of $212.1 million in the fourth
quarter of 2013 compared to $229.3 million in the fourth quarter of 2012.
Segment operating income was $15.2 million (7.1% operating margin), which
includes the $2.7 million gain from the divestiture of the completion services
business, in the fourth quarter of 2013 compared to $17.7 million (7.7%
operating margin) in the fourth quarter of 2012.

The Mats and Integrated Services segment generated revenues of $34.9 million
in the fourth quarter of 2013 compared to $26.6 million in the fourth quarter
of 2012. Segment operating income was $15.2 million (43.7% operating margin)
in the fourth quarter of 2013 compared to $10.8 million (40.8% operating
margin) in the fourth quarter of 2012.

The Environmental Services segment generated revenues of $15.6 million in the
fourth quarter of 2013 compared to $14.4 million in the fourth quarter of
2012. Segment operating income was $4.3 million (27.5% operating margin) in
the fourth quarter of 2013 compared to $3.4 million (23.9% operating margin)
in the fourth quarter of 2012.

CONFERENCE CALL

Newpark has scheduled a conference call to discuss fourth quarter 2013
results, which will be broadcast live over the Internet, on Friday, February
14, 2014 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time. To participate
in the call, dial 480-629-9835 and ask for the Newpark Resources conference
call at least 10 minutes prior to the start time, or access it live over the
Internet at www.newpark.com. For those who cannot listen to the live call, a
replay will be available through February 28, 2014 and may be accessed by
dialing (303) 590-3030 and using pass code 4663753#. Also, an archive of the
webcast will be available shortly after the call at www.newpark.com for 90
days.

Newpark Resources, Inc. is a worldwide provider of drilling fluids, temporary
worksites and access roads for oilfield and other commercial markets, and
environmental waste treatment solutions. For more information, visit our
website at www.newpark.com.

This news release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act that are based on management's
current expectations, estimates and projections. All statements that address
expectations or projections about the future, including Newpark's strategy for
growth, product development, market position, expected expenditures and
financial results are forward-looking statements. Some of the forward-looking
statements may be identified by words like "expects," "anticipates," "plans,"
"intends," "projects," "indicates," and similar expressions. These statements
are not guarantees of future performance and involve a number of risks,
uncertainties and assumptions. Many factors, including those discussed more
fully elsewhere in this release and in documents filed with the Securities and
Exchange Commission by Newpark, particularly its Annual Report on Form 10-K
for the year ended December 31, 2012, as well as others, could cause results
to differ materially from those stated. These risk factors include, but are
not limited to, our ability to execute our business strategy and make
successful business acquisitions and capital investments, our customers'
activity levels in exploration and drilling, operating hazards inherent in
the oil and natural gas industry, particularly offshore, our international
operations, the availability of raw materials and skilled personnel, our
customer concentration and cyclical nature of our industry, our market
competition, the cost and continued availability of borrowed funds, legal and
regulatory matters, including environmental regulations, inherent limitations
in insurance coverage, potential impairments of long-lived intangible assets,
technological developments in our industry, and the impact of severe weather,
particularly in the U.S. Gulf Coast. Newpark's filings with the Securities
and Exchange Commission can be obtained at no charge at www.sec.gov, as well
as through our website at www.newpark.com.

Contacts: Gregg Piontek, VP & CFO
          Newpark Resources, Inc.
          281-362-6800
          Ken Dennard, Managing Partner
          Karen Roan, SVP
          Dennard ▪ Lascar Associates
          713-529-6600





Newpark Resources, Inc.
Consolidated Statements of Operations
(Unaudited)             Three Months Ended                Twelve Months Ended
                        December   September   December   December   December
                        31,        30,         31,        31,        31,
(In thousands, except   2013       2013        2012       2013       2012
per share data)
Revenues                $       $       $       $        $  
                        262,509   285,708     270,328   1,107,357  1,038,019
Cost of revenues        214,313    230,206     219,817    900,169    846,529
Selling, general and
administrative          25,253     25,433      24,217     99,530     86,352
expenses
Other operating         (3,688)    (232)       43         (4,560)    (759)
income, net
Operating income       26,631     30,301      26,251     112,218    105,897
Foreign currency        736        975         333        1,818      749
exchange loss
Interest expense, net   3,229      2,728       2,403      11,279     9,740
Income from operations  22,666     26,598      23,515     99,121     95,408
before income taxes
Provision for income    9,142      7,838       12,322     33,798     35,376
taxes
Net income             $      $       $      $      $    
                        13,524     18,760    11,193    65,323    60,032
Income per common       $      $       $      $      $    
share -basic:             0.16     0.22    0.13    0.77    0.69
Income per common       $      $       $      $      $    
share -diluted:           0.14     0.20    0.12    0.69    0.62
Calculation of Diluted
EPS:
Net income             $      $       $      $      $    
                        13,524     18,760    11,193    65,323    60,032
Assumed conversion of   1,162      1,374       927        5,098      4,868
Senior Notes
Adjusted net income    $      $       $      $      $    
                        14,686     20,134    12,120    70,421    64,900
Weighted average
number of common        85,669     85,775      84,602     85,095     87,522
shares
outstanding-basic
Add: Dilutive effect
of stock options
andrestricted stock    1,738      1,503       903        1,767      876
awards
 Dilutive
effect of Senior        15,682     15,682      15,682     15,682     15,682
Notes
Diluted weighted
average number of       103,089    102,960     101,187    102,544    104,080
common shares
outstanding
Income per common       $      $       $      $      $    
share - diluted           0.14     0.20    0.12    0.69    0.62





Newpark Resources, Inc.
Operating Segment Results
(Unaudited)                Three Months Ended
                           December 31,      September 30,     December 31,
(In thousands)             2013              2013              2012
Revenues
 Fluids systems           $    212,069  $             $   
                                             233,020           229,329
 Mats and integrated       34,856            35,112            26,612
 services
 Environmental services    15,584            17,576            14,387
 Total revenues            $    262,509  $             $   
                                             285,708           270,328
Operating income (loss)
 Fluids systems           $             $            $    
                           15,158           17,140            17,714
 Mats and integrated       15,228            15,345            10,845
 services
 Environmental services    4,288             4,656             3,444
 Corporate office          (8,043)           (6,840)           (5,752)
 Total operating income   $             $            $    
                           26,631           30,301            26,251
Segment operating margin
 Fluids systems           7.1%              7.4%              7.7%
 Mats and integrated       43.7%             43.7%             40.8%
 services
 Environmental services    27.5%             26.5%             23.9%





Newpark Resources, Inc.
Consolidated Balance Sheets
(Unaudited)
                                            December 31,      December 31,
(In thousands, except share data)           2013              2012
ASSETS
 Cash and cash equivalents                  $             $    
                                            65,840           46,846
 Receivables, net                           280,445           323,439
 Inventories                                189,680           209,734
 Deferred tax asset                         11,874            11,596
 Prepaid expenses and other current assets  11,601            12,441
       Total current assets                 559,440           604,056
 Property, plant and equipment, net        279,342           253,990
 Goodwill                                   94,064            87,388
 Other intangible assets, net              29,244            41,018
 Other assets                               6,327             8,089
       Total assets                         $    968,417  $    994,541
LIABILITIES AND STOCKHOLDERS' EQUITY
 Short-term debt                            $             $     
                                            12,867           2,599
 Accounts payable                           93,001            114,377
 Accrued liabilities                        47,884            42,620
       Total current liabilities            153,752           159,596
 Long-term debt, less current portion       172,786           256,832
 Deferred tax liability                     39,509            46,348
 Other noncurrent liabilities               21,316            18,187
       Total liabilities                    387,363           480,963
 Commitments and contingencies
 Common stock, $0.01 par value,
 200,000,000 shares authorized
       and 98,030,839 and 95,733,677        980               957
       shares issued, respectively
 Paid-in capital                            504,675           484,962
 Accumulated other comprehensive loss       (9,484)           (734)
 Retained earnings                         160,338           95,015
 Treasury stock, at cost; 10,832,845 and    (75,455)          (66,622)
 10,115,951 shares, respectively
       Total stockholders' equity           581,054           513,578
 Total liabilities and stockholders'        $    968,417  $    994,541
 equity





Newpark Resources, Inc.
Consolidated Statements of Cash Flows
(Unaudited)                                            Year Ended December 31,
(In thousands)                                         2013         2012
Cash flows from operating activities:
Net income                                             $ 65,323    $ 60,032
Adjustments to reconcile net income to net cash
provided by operations:
 Impairment charges                                  176          443
 Depreciation and amortization                       44,198       32,821
 Stock-based compensation expense                    9,699        7,103
 Provision for deferred income taxes                 (7,832)      1,358
 Net provision for doubtful accounts                 416          1,709
 (Gain) loss on sale of assets                       (3,178)      724
 Excess tax benefit from stock-based compensation    (2,146)      -
 Change in assets and liabilities:
 Decrease in receivables                          32,172       23,565
 Decrease (increase) in inventories               16,431       (28,758)
 Decrease (increase) in other assets              4,574        (641)
 (Decrease) increase in accounts payable          (17,733)     13,702
 Increase (decrease) in accrued liabilities and   9,803        (1,813)
other
Net cash provided by operating activities              151,903      110,245
Cash flows from investing activities:
 Capital expenditures                                (67,929)     (43,955)
 Proceeds from sale of property, plant and           1,313        863
equipment
 Proceeds from sale of a business                    13,329       -
 Business acquisitions, net of cash acquired         (6,776)      (53,075)
Net cash used in investing activities                  (60,063)     (96,167)
Cash flows from financing activities:
 Borrowings on lines of credit                       254,390      364,426
 Payments on lines of credit                         (328,086)    (296,944)
 Other financing activities                          (25)         (40)
 Proceeds from employee stock plans                  8,328        1,059
 Post-closing payment for business acquisition       -            (11,892)
 Excess tax benefit from stock-based compensation    2,146        -
 Purchase of treasury stock                          (9,281)      (50,756)
Net cash (used in) provided by financing activities    (72,528)     5,853
Effect of exchange rate changes on cash                (318)        1,668
Net increase in cash and cash equivalents              18,994       21,599
Cash and cash equivalents at beginning of year         46,846       25,247
Cash and cash equivalents at end of year               $ 65,840    $ 46,846



SOURCE Newpark Resources, Inc.

Website: http://www.newpark.com
 
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