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

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

Source:Vantage Drilling International