Cal Dive reports second quarter 2010 financial resultsCompany News // August 24, 2010
Cal Dive International in the US has reported a second quarter 2010 net loss of US$7.3 million, or US$.08 per diluted share, excluding a US$3.7 million (US$.04 per diluted share) non-cash year to date tax adjustment.
Including the tax adjustment, the company reported a second quarter net loss of US$11.0 million, or US$.12 per diluted share. This compares to US$28.6 million in net income and US$.30 per diluted share for the same period of 2009.
The net loss is due to decreased vessel utilization and day rates as the result of a decline in demand for the company's services worldwide. Consistent with the first quarter of 2010, the decline in demand was primarily due to a reduction in hurricane repair work in the Gulf of Mexico and in new construction activity.
During the second quarter of 2009, the Company performed several large construction projects that did not reoccur in 2010 involving an LNG project located offshore Boston and two pipelay projects in China and Mexico.
There was also a general decline in activity levels because of reduced customer spending due to the lag effect of decreased offshore drilling in 2009, uncertainty in the economic outlook and commodity prices, and more recently the uncertainty caused by the oil spill in the Gulf of Mexico.
Despite generating a loss before taxes during the second quarter of 2010, the company recorded a tax expense in the second quarter instead of a tax benefit.
The second quarter tax expense reflects the tax adjustment necessary (US$3.7 million or US$.04 per diluted share) to reflect the actual year to date tax benefit at an effective rate of 26 per cent.
Quinn Hébert, Chairman, President and Chief Executive Officer of Cal Dive, said: "While the second quarter results improved from the first quarter, low utilization levels persisted during the first half of the quarter. The good news is that most of our assets are currently working offshore as activity levels have increased significantly since the middle of May with improved weather in the Gulf of Mexico, although at lower day rates compared to 2009."
"While the long-term impact from the oil spill in the Gulf of Mexico on our company is unknown at this time, we are performing work relating to the spill that in the short-term should at least partially offset any impact from reduced customer spending and delay or cancellation of projects as a result of the increased uncertainty in the market and regulatory environment."
"Bidding activity remains high and we have increased our backlog heading into the third quarter, which we expect to be our busiest and most profitable of the year. Internationally, our two saturation diving vessels are currently working while we are actively pursuing work for our construction barge."