TESCO Corporation Reports Fourth Quarter 2016 Results
Revenue grows 16% to $35.3 million showing first sequential quarterly increase in 10 quarters
Reported U.S. GAAP diluted EPS was a loss of $(0.43) on a net loss of $20.1 million and adjusted EPS was a loss of $(0.28) on an adjusted net loss of $13.3 million, excluding $0.15 in special charges
Adjusted EBITDA loss was $4.4 million for the fourth quarter, compared to a loss of $9.1 million for the third quarter
Cash increases to $91.5 million at December 31, 2016 as operating cash flow improves to $3.5 million and free cash flow improves to $2.1 million
HOUSTON, February 28, 2017 -- TESCO Corporation ("TESCO" or the "Company") (NASDAQ: TESO) today reported fourth quarter 2016 financial and operating results.
Fourth Quarter Operating Results
Fernando Assing, TESCO's Chief Executive Officer, commented, "We are encouraged by our improved sequential financial performance as activity levels respond to higher commodity prices and rig count. However, we remain cautious as we recognize that 2017 will still present challenges in international and offshore markets as well as increasing cost escalation risks and limited pricing power in North America."
TESCO reported revenue of $35.3 million for the fourth quarter ended December 31, 2016, up from $30.4 million, or 16% in the third quarter of 2016, and down from $52.2 million, or 32% for the fourth quarter of 2015. The sequential increase in revenue was primarily from higher aftermarket part sales and increased activity in both U.S. land and offshore tubular services markets.
TESCO reported a U.S. GAAP net loss of $20.1 million, or $(0.43) per diluted share, for the fourth quarter ended December 31, 2016. Adjusted net loss for the quarter was $13.3 million, or $(0.28) per share, excluding special items, consisting primarily of several charges related to receivables and restructuring costs. This compares to a U.S. GAAP net loss of $22.1 million, or $(0.48) per diluted share in the third quarter of 2016, and a U.S. GAAP net loss of $78.1 million, or $(2.00) per diluted share, for the fourth quarter of 2015. Adjusted net loss in the third quarter of 2016 was $17.3 million, or $(0.37) per diluted share, and in the fourth quarter of 2015 was $13.4 million, or $(0.33) per diluted share.
Adjusted EBITDA loss was $4.4 million for the fourth quarter compared to adjusted EBITDA loss of $9.1 million in the third quarter of 2016, an improvement of 52%. Fourth quarter 2016 U.S. GAAP operating loss was $18.9 million and adjusted operating loss was $13.1 million, which excludes the impact of $5.8 million of pre-tax charges. This compares to the third quarter 2016 U.S. GAAP operating loss of $21.9 million and adjusted operating loss of $17.4 million, which excluded $4.5 million of pre-tax charges.
Cash and cash equivalents as of December 31, 2016 increased from the third quarter by $1.4 million to $91.5 million primarily due to $3.5 million of positive operating cash flow.
Adjusted free cash flow was $2.5 million before approximately $0.4 million of restructuring payments, compared to negative adjusted free flow of $5.7 million in the prior quarter. The sequential increase was primarily caused by lower operating losses, inventory reductions, higher collections and tax refunds.
The following information was filed by Tesco Corp (TESO) on Tuesday, February 28, 2017 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.