Vantage Drilling International Reports Fourth Quarter and Full-Year 2017 Results

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| Source: Vantage Drilling International

HOUSTON, March 28, 2018 (GLOBE NEWSWIRE) -- Vantage Drilling International ("Vantage" or the “Company”) reported a net loss of approximately $36.6 million or $7.33 per share for the three months ended December 31, 2017 as compared to a net loss of $41.1 million or $8.23 per share for the three months ended December 31, 2016.

For the year ended December 31, 2017, Vantage reported a net loss of approximately $149.8 million or $29.96 per share. For the period from February 10, 2016 to December 31, 2016, Vantage reported a net loss of approximately $147.4 million or $29.48 per share and the Predecessor for the period January 1, 2016 to February 10, 2016 reported a net loss of approximately $471.0 million.

Vantage’s operating results for the fourth quarter reflected rig uptime of 98% and revenue efficiency of 99%.

As of December 31, 2017, Vantage had approximately $195.5 million of available cash. Uses of cash during the quarter included, among other things, debt service costs and the re-activation of the Platinum Explorer.  

Ihab Toma, CEO, commented, “I am pleased to report that with the commencement of the Platinum Explorer three year contract for ONGC, in India, during the fourth quarter, we successfully reactivated three of our four previously stacked units during a difficult year for the offshore drilling industry and now have six of our seven premium assets working.”

Upon emergence from the Company’s Chapter 11 restructuring on February 10, 2016, Vantage adopted fresh-start accounting, which resulted in the Company becoming a new entity for financial reporting purposes.  References to “Successor” relate to the financial position and results of operations of the reorganized Vantage as of and subsequent to February 10, 2016. References to “Predecessor” refer to the financial position of Vantage as of and prior to February 10, 2016 and the results of operations prior to February 10, 2016. As a result of the application of fresh-start accounting and the effects of the implementation of our Plan of Reorganization, the financial statements on or after February 10, 2016 are not comparable with the financial statements prior to that date.

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with a fleet of three ultra-deepwater drillships and four premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells globally for major, national and independent oil and natural gas companies. Vantage also provides construction supervision services and preservation management services for, and will operate and manage, drilling units owned by others.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the company's filings with the Securities and Exchange Commission. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements.  Vantage disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Public & Investor Relations Contact:

Thomas J. Cimino
Chief Financial Officer
Vantage Drilling International
(281) 404-4700

Vantage Drilling International
Consolidated Statement of Operations
(In thousands, except per share data)
(Unaudited)
  Successor  Predecessor 
  Three Months Ended
December 31,
 Year Ended
December 31, 2017
 Period from
February 10, 2016
to December 31,
2016
  Period from
January 1, 2016 to
February 10, 2016
 
   2017   2016      
Revenue            
Contract drilling services $52,881  $34,655  $190,553  $134,370   $20,891  
Management fees  307   410   1,456   4,074    752  
Reimbursables  6,650   5,344   20,837   20,204    1,897  
Total revenue  59,838   40,409   212,846   158,648    23,540  
Operating costs and expenses            
Operating costs  42,638   29,635   161,668   123,022    25,213  
General and administrative  11,719   8,931   41,648   36,922    2,558  
Depreciation  18,394   18,486   73,925   67,920    10,696  
Total operating costs and expenses  72,751   57,052   277,241   227,864    38,467  
Loss from operations  (12,913)  (16,643)  (64,395)  (69,216)   (14,927) 
Other income (expense)            
Interest income  221   (8)  808   18    3  
Interest expense and other financing charges (contractual interest of 
$23,219 for the period from January 1, 2016 to February 10, 2016)
  (19,261)  (18,879)  (76,441)  (67,023)   (1,728) 
Other, net  428   145   2,501   1,132    (69) 
Reorganization items     (774)     (1,380)   (452,919) 
Bargain purchase gain        1,910         
Total other expense  (18,612)  (19,516)  (71,222)  (67,253)   (454,713) 
Loss before income taxes  (31,525)  (36,159)  (135,617)  (136,469)   (469,640) 
Income tax provision  5,101   4,970   14,168   10,948    2,371  
Net loss  (36,626)  (41,129)  (149,785)  (147,417)   (472,011) 
Net loss attributable to noncontrolling interests               (969) 
Net loss attributable to VDI $(36,626) $(41,129) $(149,785) $(147,417)  $(471,042) 
Net loss per share, basic and diluted $(7.33) $(8.23) $(29.96) $(29.48)  N/A 
Weighted average successor ordinary shares outstanding, basic and diluted  5,000   5,000   5,000   5,000   N/A 
   
     
Vantage Drilling International    
Supplemental Operating Data    
(Unaudited, in thousands, except percentages)    
  Successor  Predecessor 
  Three Months Ended
December 31,
 Year Ended
December 31,
2017
 Period from
February 10,
2016 to
December 31,
2016
  Period from
January 1,
2016 to
February 10,
2016
 
   2017   2016      
Operating costs and expenses            
Jackups $19,623  $10,014  $72,283  $39,569   $5,975  
Deepwater  16,104   13,270   64,823   57,833    15,550  
Operations support  2,893   2,403   12,334   9,859    2,219  
Reimbursables  4,018   3,948   12,228   15,761    1,469  
  $42,638  $29,635  $161,668  $123,022   $25,213  
             
Utilization            
Jackups  99.5%  39.5%  82.0%  42.3%   53.6% 
Deepwater  45.4%  33.3%  36.2%  33.3%   33.3% 
 

 

 
Vantage Drilling International
Consolidated Balance Sheet
(In thousands, except share and par value information)
(Unaudited)
    
 December 31,
2017
 December 31,
2016
    
ASSETS   
Current assets   
Cash and cash equivalents$  195,455  $  231,727 
Trade receivables   45,379     20,850 
Inventory   43,955     45,206 
Prepaid expenses and other current assets   13,207     12,423 
Total current assets   297,996     310,206 
Property and equipment   
Property and equipment   904,584     902,241 
Accumulated depreciation   (141,393)    (67,713)
Property and equipment, net   763,191     834,528 
Other assets   21,935     15,694 
Total assets$  1,083,122  $  1,160,428 
    
LIABILITIES AND SHAREHOLDERS' EQUITY   
Current liabilities   
Accounts payable$  39,666  $  35,283 
Accrued liabilities   25,117     18,448 
Current maturities of long-term debt   4,430     1,430 
Total current liabilities   69,213     55,161 
Long–term debt, net of discount and financing costs of $56,174 and $105,568   919,939     867,372 
Other long-term liabilities   17,195     11,335 
Commitments and contingencies   
Shareholders' equity   
Ordinary shares, $0.001 par value, 50 million shares authorized; 5,000,053 shares issued and outstanding   5     5 
Additional paid-in capital   373,972     373,972 
Accumulated deficit    (297,202)    (147,417)
Total shareholders' equity   76,775     226,560 
Total liabilities and shareholders’ equity$  1,083,122  $  1,160,428 
    

 

 
Vantage Drilling International
Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
       
 Successor  Predecessor
 Year Ended
December 31, 2017
 Period from
February 10,
2016 to
December 31,
2016
  Period from
January 1, 2016 to
February 10, 2016
CASH FLOWS FROM OPERATING ACTIVITIES      
Net income (loss)$  (149,785) $  (147,417)  $  (472,011)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:      
Depreciation expense   73,925     67,920      10,696 
Amortization of debt financing costs   468     427      — 
Amortization of debt discount   48,925     43,208      — 
Amortization of contract value   4,686     —      — 
PIK interest on the Convertible Notes   7,604     6,712      — 
Reorganization items   —     —      430,210 
Share-based compensation expense   3,997     402      — 
Gain on bargain purchase   (1,910)    —      — 
Deferred income tax benefit   (1,964)    (3,368)     — 
Loss on disposal of assets   335     652      — 
Changes in operating assets and liabilities:      
Restricted cash   —     1,000      (1,000)
Trade receivables   (24,529)    53,447      (3,575)
Inventory   1,251     (964)     223 
Prepaid expenses and other current assets   1,267     2,790      6,893 
Other assets   2,638     (3,409)     941 
Accounts payable   4,383     736      (14,890)
Accrued liabilities and other long-term liabilities   8,836     (26,010)     21,148 
Net cash provided by (used in) operating activities   (19,873)    (3,874)     (21,365)
CASH FLOWS FROM INVESTING ACTIVITIES      
Additions to property and equipment   (2,224)    (11,964)     116 
Cash paid for Vantage 260 acquisition   (13,000)    —      — 
Cash received for Vantage 260 sale   255     —      — 
Net cash provided by (used in) investing activities   (14,969)    (11,964)     116 
CASH FLOWS FROM FINANCING ACTIVITIES      
Repayment of long-term debt   (1,430)    (1,430)     (7,000)
Proceeds from issuance of 10% Second Lien Notes   —     —      75,000 
Debt issuance costs   —     (51)     (1,125)
Net cash provided by (used in) financing activities   (1,430)    (1,481)     66,875 
Net increase (decrease) in cash and cash equivalents   (36,272)    (17,319)     45,626 
Cash and cash equivalents—beginning of period   231,727     249,046      203,420 
Cash and cash equivalents—end of period$  195,455  $  231,727   $  249,046