Press Release Details
Mitcham Industries Reports Fiscal 2019 Fourth Quarter And Full Year Results
Total revenues for the fourth quarter of fiscal 2019 increased 19% to
The Company reported a net loss of
Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, stock-based compensation, non-cash costs of lease pool equipment sales, non-cash foreign exchange gains and losses and other non-cash tax related items) for the fourth quarter of fiscal 2019 was approximately
"Our Marine Technology Products segment experienced improving activity during the fourth quarter driven by top-line growth. Despite the increased order activity, revenue from both Seamap and Klein was down sequentially due to the delivery delays mentioned earlier. However, we do expect both businesses to continue to grow in fiscal 2020, aided by solid order activity, increasing backlog and the introduction of new technology that we plan to unveil to the market in the very near future.
"We expect our Seamap business to continue to benefit from systems sales to
"On the
"On the financial front, we are pleased to report that Mitcham was cash flow positive in the fourth quarter of fiscal 2019. In addition, our capital structure remains strong, with no debt on our balance sheet and ample liquidity, including cash and cash equivalents of
FISCAL 2019 FOURTH QUARTER RESULTS
Total revenues for the fourth quarter of fiscal 2019 increased compared to last year's fourth quarter to
Equipment leasing revenues for the fourth quarter of fiscal 2019, excluding equipment sales, were
Lease pool depreciation expense in the fourth quarter of fiscal 2019 decreased to
Selling, general and administrative expenses decreased slightly to
As a result of the decision to sell our Australian subsidiary, as of
FISCAL 2019 RESULTS
Total revenues for fiscal 2019 decreased 11% to
CONFERENCE CALL
We have scheduled a conference call for
About
Certain statements and information in this press release concerning results for the quarter ended
For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the
Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.
Contacts: |
Rob Capps, Co-CEO |
Mitcham Industries, Inc. |
|
936-291-2277 |
|
Jack Lascar / Mark Roberson |
|
Dennard Lascar Investor Relations |
|
713-529-6600 |
Tables to Follow
MITCHAM INDUSTRIES, INC. |
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
(in thousands, except per share data) |
|||||
(unaudited) |
|||||
January 31, 2019 |
January 31, 2018 |
||||
ASSETS |
|||||
Current assets: |
|||||
Cash and cash equivalents |
$ |
9,389 |
$ |
9,902 |
|
Restricted cash |
160 |
244 |
|||
Accounts receivable, net of allowance for doubtful accounts of $2,113 and $3,885 at January 31, 2019 and 2018, respectively |
12,082 |
10,494 |
|||
Inventories, net |
10,774 |
10,856 |
|||
Prepaid expenses and other current assets |
1,735 |
1,550 |
|||
Assets held for sale |
2,202 |
— |
|||
Total current assets |
36,342 |
33,046 |
|||
Seismic equipment lease pool and property and equipment, net |
14,155 |
22,900 |
|||
Intangible assets, net |
10,495 |
8,015 |
|||
Goodwill |
2,531 |
2,531 |
|||
Non-current prepaid income taxes |
128 |
1,609 |
|||
Deferred tax asset |
68 |
— |
|||
Long-term receivables, net of allowance for doubtful accounts of $- and $2,282 at January 31, 2019 and 2018, respectively |
712 |
4,652 |
|||
Other assets |
584 |
926 |
|||
Long-term assets held for sale |
286 |
— |
|||
Total assets |
$ |
65,301 |
$ |
73,679 |
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||
Current liabilities: |
|||||
Accounts payable |
$ |
1,534 |
$ |
1,271 |
|
Deferred revenue |
1,040 |
741 |
|||
Accrued expenses and other current liabilities |
3,738 |
5,253 |
|||
Income taxes payable |
224 |
258 |
|||
Liabilities held for sale |
892 |
— |
|||
Total current liabilities |
7,428 |
7,523 |
|||
Other non-current liabilities |
1,195 |
— |
|||
Deferred tax liability |
— |
307 |
|||
Total liabilities |
8,623 |
7,830 |
|||
Shareholders' equity: |
|||||
Preferred stock, at cost, $1.00 par value; 1,000 shares authorized; 830 and 532 shares issued and outstanding at January 31, 2019 and 2018, respectively |
18,330 |
11,544 |
|||
Common stock, $0.01 par value; 20,000 shares authorized; 14,049 and 14,019 shares issued at January 31, 2019 and 2018, respectively |
140 |
140 |
|||
Additional paid-in capital |
123,085 |
122,304 |
|||
Treasury stock, at cost (1,929 shares at January 31, 2019 and January 31, 2018) |
(16,860) |
(16,860) |
|||
Accumulated deficit |
(63,973) |
(42,425) |
|||
Accumulated other comprehensive loss |
(4,044) |
(8,854) |
|||
Total shareholders' equity |
56,678 |
65,849 |
|||
Total liabilities and shareholders' equity |
$ |
65,301 |
$ |
73,679 |
MITCHAM INDUSTRIES, INC. |
|||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||
(in thousands, except per share data) |
|||||||||||
(unaudited) |
|||||||||||
For the Three Months Ended |
For the Twelve Months Ended |
||||||||||
2019 |
2018 |
2019 |
2018 |
||||||||
Revenues: |
|||||||||||
Sale of marine technology products |
$ |
6,851 |
$ |
4,991 |
$ |
25,571 |
$ |
27,420 |
|||
Equipment leasing |
3,934 |
2,061 |
11,427 |
7,826 |
|||||||
Sale of lease pool and other equipment |
1,543 |
3,311 |
5,944 |
13,030 |
|||||||
Total revenues |
12,328 |
10,363 |
42,942 |
48,276 |
|||||||
Cost of sales: |
|||||||||||
Sale of marine technology products |
4,657 |
3,711 |
14,863 |
16,686 |
|||||||
Equipment leasing (including lease pool depreciation) |
3,402 |
3,949 |
13,522 |
17,764 |
|||||||
Equipment sales |
858 |
1,332 |
2,817 |
7,742 |
|||||||
Total cost of sales |
8,917 |
8,992 |
31,202 |
42,192 |
|||||||
Gross profit |
3,411 |
1,371 |
11,740 |
6,084 |
|||||||
Operating expenses: |
|||||||||||
Selling, general and administrative |
4,952 |
5,155 |
20,905 |
19,663 |
|||||||
Research and development |
302 |
865 |
1,159 |
1,502 |
|||||||
Provision for doubtful accounts |
— |
1,013 |
200 |
1,013 |
|||||||
Impairment of intangible assets |
— |
1,466 |
— |
1,466 |
|||||||
Depreciation and amortization |
680 |
526 |
2,496 |
2,148 |
|||||||
Total operating expenses |
5,934 |
9,025 |
24,760 |
25,792 |
|||||||
Operating loss |
(2,523) |
(7,654) |
(13,020) |
(19,708) |
|||||||
Other income (expense): |
|||||||||||
Loss on sale (including $5,355 of net cumulative translation loss) |
(500) |
— |
(5,405) |
— |
|||||||
Reserve against non-current prepaid income taxes |
(1,211) |
— |
(1,211) |
— |
|||||||
Interest income, net |
25 |
24 |
72 |
47 |
|||||||
Other, net |
33 |
(391) |
(24) |
(498) |
|||||||
Total other expense |
(1,653) |
(367) |
(6,568) |
(451) |
|||||||
Loss before income taxes |
(4,176) |
(8,021) |
(19,588) |
(20,159) |
|||||||
Benefit (provision) for income taxes |
21 |
262 |
(252) |
(910) |
|||||||
Net loss |
$ |
(4,155) |
$ |
(7,759) |
$ |
(19,840) |
$ |
(21,069) |
|||
Preferred stock dividends |
(463) |
(275) |
(1,708) |
(905) |
|||||||
Net loss attributable to common shareholders |
$ |
(4,618) |
$ |
(8,034) |
$ |
(21,548) |
$ |
(21,974) |
|||
Net loss per common share: |
|||||||||||
Basic |
$ |
(0.38) |
$ |
(0.66) |
$ |
(1.78) |
$ |
(1.82) |
|||
Diluted |
$ |
(0.38) |
$ |
(0.66) |
$ |
(1.78) |
$ |
(1.82) |
|||
Shares used in computing loss per common share: |
|||||||||||
Basic |
12,119 |
12,087 |
12,105 |
12,084 |
|||||||
Diluted |
12,119 |
12,087 |
12,105 |
12,084 |
MITCHAM INDUSTRIES, INC. |
|||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||
(in thousands) |
|||||
(unaudited) |
|||||
For the Twelve Months |
|||||
2019 |
2018 |
||||
Cash flows from operating activities: |
|||||
Net loss |
$ |
(19,840) |
$ |
(21,069) |
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
|||||
Depreciation and amortization |
11,814 |
16,637 |
|||
Stock-based compensation |
781 |
903 |
|||
Impairment |
— |
1,466 |
|||
Provision for doubtful accounts, net of charge offs |
200 |
1,013 |
|||
Provision for inventory obsolescence |
140 |
815 |
|||
Gross profit from sale of lease pool equipment |
(2,367) |
(4,906) |
|||
Loss on sale of business |
5,405 |
— |
|||
Deferred tax expense |
(376) |
(20) |
|||
Non-current prepaid income taxes |
1,577 |
182 |
|||
Changes in: |
|||||
Trade accounts receivable |
1,292 |
4,405 |
|||
Unbilled revenue |
(340) |
— |
|||
Inventories |
(781) |
685 |
|||
Accounts payable, accrued expenses and other current liabilities |
(722) |
(455) |
|||
Prepaid expenses and other current assets |
(1,382) |
1,002 |
|||
Deferred revenue |
567 |
— |
|||
Foreign exchange losses net of gains |
171 |
61 |
|||
Net assets held for sale |
(1,596) |
— |
|||
Net cash (used in) provided by operating activities |
(5,457) |
719 |
|||
Cash flows from investing activities: |
|||||
Purchases of seismic equipment held for lease |
(1,717) |
(909) |
|||
Acquisition of assets |
(3,000) |
— |
|||
Purchases of property and equipment |
(814) |
(407) |
|||
Sales of used lease pool equipment |
5,663 |
10,313 |
|||
Sale of business, net of cash sold |
(147) |
— |
|||
Net cash (used in) provided by investing activities |
(15) |
8,997 |
|||
Cash flows from financing activities: |
|||||
Net payments on revolving line of credit |
— |
(3,500) |
|||
Payments on term loan and other borrowings |
— |
(2,807) |
|||
Net proceeds from preferred stock offering |
6,853 |
4,174 |
|||
Preferred stock dividends |
(1,708) |
(905) |
|||
Net cash provided by (used in) financing activities |
5,145 |
(3,038) |
|||
Effect of changes in foreign exchange rates on cash, cash equivalents and restricted cash |
(270) |
(43) |
|||
Net increase (decrease) in cash and cash equivalents, including cash classifiedwithin current assets held for sale |
458 |
— |
|||
Less: Net increase (decrease) in cash classified within current assets held for sale |
(458) |
— |
|||
Net (decrease) increase in cash, cash equivalents and restricted cash |
(597) |
6,635 |
|||
Cash, cash equivalents and restricted cash, beginning of period |
10,146 |
3,511 |
|||
Cash, cash equivalents and restricted cash, end of period |
$ |
9,549 |
$ |
10,146 |
MITCHAM INDUSTRIES, INC. |
|||||||||||
Reconciliation of Net Loss and Net Cash Provided by Operating Activities to EBITDA and |
|||||||||||
Adjusted EBITDA |
|||||||||||
(unaudited) |
|||||||||||
For the Three Months Ended |
For the Twelve Months Ended |
||||||||||
2019 |
2018 |
2019 |
2018 |
||||||||
(in thousands) |
(in thousands) |
||||||||||
Reconciliation of Net loss to EBITDA and Adjusted EBITDA |
|||||||||||
Net loss |
$ |
(4,155) |
$ |
(7,759) |
$ |
(19,840) |
$ |
(21,069) |
|||
Interest income, net |
(25) |
(24) |
(72) |
(47) |
|||||||
Depreciation and amortization |
2,630 |
3,418 |
11,814 |
16,637 |
|||||||
(Benefit) provision for income taxes |
(21) |
(262) |
252 |
910 |
|||||||
EBITDA (1) |
(1,571) |
(4,627) |
(7,846) |
(3,569) |
|||||||
Non-cash foreign exchange losses |
2 |
524 |
5,620 |
844 |
|||||||
Stock-based compensation |
206 |
218 |
781 |
903 |
|||||||
Impairment of intangible assets |
— |
1,466 |
— |
1,466 |
|||||||
Reserve against non-current prepaid income taxes |
1,211 |
— |
1,211 |
— |
|||||||
Cost of lease pool sales |
263 |
1,263 |
1,162 |
7,571 |
|||||||
Adjusted EBITDA (1) |
$ |
111 |
$ |
(1,156) |
$ |
928 |
$ |
7,215 |
|||
Reconciliation of Net cash provided by operating activities to EBITDA |
|||||||||||
Net cash (used in) provided by operating activities |
$ |
2,503 |
$ |
(1,455) |
$ |
(5,457) |
$ |
719 |
|||
Stock-based compensation |
(206) |
(218) |
(781) |
(903) |
|||||||
Provision for doubtful accounts |
— |
(1,013) |
(200) |
(1,013) |
|||||||
Provision for inventory obsolescence |
— |
(757) |
(140) |
(815) |
|||||||
Changes in trade accounts, contracts and notes receivable |
(4,605) |
724 |
(1,292) |
(4,405) |
|||||||
Interest paid |
6 |
2 |
8 |
86 |
|||||||
Taxes paid, net of refunds |
208 |
58 |
622 |
494 |
|||||||
Gross profit from sale of lease pool equipment |
519 |
1,826 |
2,367 |
4,906 |
|||||||
Loss on sale of subsidiaries |
(500) |
— |
(5,405) |
— |
|||||||
Changes in inventory |
(523) |
(606) |
781 |
(685) |
|||||||
Changes in accounts payable, accrued expenses and other current liabilities and deferred revenue |
57 |
(789) |
155 |
455 |
|||||||
Impairment of intangible assets |
— |
(1,466) |
— |
(1,466) |
|||||||
Changes in prepaid expenses and other current assets |
224 |
(795) |
1,382 |
(1,002) |
|||||||
Foreign exchange (losses) gains, net |
165 |
(313) |
(171) |
(61) |
|||||||
Reserve against non-current prepaid income taxes |
(1,211) |
— |
(1,211) |
— |
|||||||
Net assets held for sale |
1,596 |
— |
1,596 |
— |
|||||||
Other |
196 |
175 |
(100) |
121 |
|||||||
EBITDA (1) |
$ |
(1,571) |
$ |
(4,627) |
$ |
(7,846) |
$ |
(3,569) |
1. |
EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation and amortization. Adjusted EBITDA excludes non-cash foreign exchange gains and losses, non-cash costs of lease pool equipment sales, stock-based compensation and other non-cash tax related items. We consider EBITDA and Adjusted EBITDA to be important indicators for the performance of our business, but not measures of performance or liquidity calculated in accordance with GAAP. We have included these non-GAAP financial measures because management utilizes this information for assessing our performance and liquidity, and as indicators of our ability to make capital expenditures, service debt and finance working capital requirements and we believe that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us. In particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities. We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or as alternatives to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP. In evaluating our performance as measured by EBITDA, management recognizes and considers the limitations of this measurement. EBITDA and Adjusted EBITDA do not reflect our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures. Accordingly, EBITDA and Adjusted EBITDA are only two of the measurements that management utilizes. Other companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies. |
Mitcham Industries, Inc. |
|||||||||||||||
Segment Operating Results |
|||||||||||||||
(in thousands) |
|||||||||||||||
(unaudited) |
|||||||||||||||
For the Three Months Ended |
For the Twelve Months Ended |
||||||||||||||
2019 |
2018 |
2019 |
2018 |
||||||||||||
Revenues: |
|||||||||||||||
Marine technology products |
$ |
6,743 |
$ |
5,008 |
$ |
25,768 |
$ |
27,573 |
|||||||
Equipment leasing |
5,477 |
5,373 |
17,383 |
20,919 |
|||||||||||
Inter-segment sales |
108 |
(18) |
(209) |
(216) |
|||||||||||
Total revenues |
12,328 |
10,363 |
42,942 |
48,276 |
|||||||||||
Cost of sales: |
|||||||||||||||
Marine technology products |
4,530 |
3,728 |
15,027 |
16,844 |
|||||||||||
Equipment leasing |
4,293 |
5,282 |
16,384 |
25,563 |
|||||||||||
Inter-segment costs |
94 |
(18) |
(209) |
(215) |
|||||||||||
Total cost of sales |
8,917 |
8,992 |
31,202 |
42,192 |
|||||||||||
Gross profit |
3,411 |
1,371 |
11,740 |
6,084 |
|||||||||||
Operating expenses: |
|||||||||||||||
Selling, general and administrative |
4,952 |
5,155 |
20,905 |
19,663 |
|||||||||||
Research and development |
302 |
865 |
1,159 |
1,502 |
|||||||||||
Provision for doubtful accounts |
— |
1,013 |
200 |
1,013 |
|||||||||||
Impairment of intangible assets |
— |
1,466 |
— |
1,466 |
|||||||||||
Depreciation and amortization |
680 |
526 |
2,496 |
2,148 |
|||||||||||
Total operating expenses |
5,934 |
9,025 |
24,760 |
25,792 |
|||||||||||
Operating loss |
$ |
(2,523) |
$ |
(7,654) |
$ |
(13,020) |
$ |
(19,708) |
|||||||
Marine Technology Products Segment: |
|||||||||||||||
Revenues: |
|||||||||||||||
Seamap |
$ |
4,886 |
$ |
2,474 |
$ |
15,989 |
$ |
18,527 |
|||||||
Klein |
1,279 |
1,146 |
7,474 |
4,602 |
|||||||||||
SAP |
902 |
1,669 |
3,264 |
5,667 |
|||||||||||
Intra-segment sales |
(324) |
(281) |
(959) |
(1,223) |
|||||||||||
6,743 |
5,008 |
25,768 |
27,573 |
||||||||||||
Cost of sales: |
|||||||||||||||
Seamap |
3,068 |
1,580 |
8,566 |
10,018 |
|||||||||||
Klein |
1,069 |
1,061 |
4,748 |
3,632 |
|||||||||||
SAP |
717 |
1,355 |
2,686 |
4,513 |
|||||||||||
Intra-segment sales |
(324) |
(268) |
(973) |
(1,319) |
|||||||||||
4,530 |
3,728 |
15,027 |
16,844 |
||||||||||||
Gross profit |
$ |
2,213 |
$ |
1,280 |
$ |
10,741 |
$ |
10,729 |
|||||||
Gross profit margin |
33% |
26% |
42% |
39% |
|||||||||||
Equipment Leasing Segment: |
|||||||||||||||
Revenue: |
|||||||||||||||
Equipment leasing |
$ |
3,934 |
$ |
2,060 |
$ |
11,439 |
$ |
7,826 |
|||||||
Lease pool equipment sales |
781 |
3,089 |
3,529 |
12,478 |
|||||||||||
Other equipment sales |
762 |
224 |
2,415 |
615 |
|||||||||||
5,477 |
5,373 |
17,383 |
20,919 |
||||||||||||
Cost of sales: |
|||||||||||||||
Direct costs-equipment leasing |
1,524 |
1,088 |
4,381 |
3,450 |
|||||||||||
Lease pool depreciation |
1,911 |
2,861 |
9,186 |
14,370 |
|||||||||||
Cost of lease pool equipment sales |
263 |
1,263 |
1,162 |
7,571 |
|||||||||||
Cost of other equipment sales |
595 |
70 |
1,655 |
172 |
|||||||||||
4,293 |
5,282 |
16,384 |
25,563 |
||||||||||||
Gross profit (loss) |
$ |
1,184 |
$ |
91 |
$ |
999 |
$ |
(4,644) |
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