e10vq
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2011
GULFMARK OFFSHORE, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
001-33607
(Commission file number)
76-0526032
(I.R.S. Employer Identification No.)
|
|
|
10111 Richmond Avenue, Suite 340, Houston, Texas
|
|
77042 |
(Address of principal executive offices)
|
|
(Zip Code) |
(713) 963-9522
(Registrants telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports) and (2) has been
subject to such filing requirements for the past 90 days.
YES þ NO o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files).
YES þ NO o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See definition of large
accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act. (Check One):
|
|
|
|
|
|
|
Large accelerated
filer þ
|
|
Accelerated filer o
|
|
Non-accelerated filer o
|
|
Smaller reporting company o |
|
|
|
|
(Do not check if a smaller reporting company) |
|
|
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of
the Exchange Act).
YES o NO þ
Number of shares of Class A Common Stock, $0.01 par value, outstanding as of July 21, 2011:
26,539,660
(Exhibit Index Located on Page 26)
GulfMark Offshore, Inc.
Index
2
PART 1. FINANCIAL INFORMATION
|
|
|
ITEM 1. |
|
FINANCIAL STATEMENTS |
GULFMARK OFFSHORE, INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2011 |
|
|
2010 |
|
|
|
(In thousands, except par value amount) |
|
ASSETS
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
113,943 |
|
|
$ |
97,195 |
|
Trade accounts receivable, net of allowance for doubtful accounts of $97 and $283, respectively |
|
|
82,913 |
|
|
|
66,714 |
|
Other accounts receivable |
|
|
12,510 |
|
|
|
10,326 |
|
Prepaid expenses and other |
|
|
18,251 |
|
|
|
16,645 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
227,617 |
|
|
|
190,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vessels, equipment, and other fixed assets at cost, net of accumulated depreciation of $318,403 and $282,395, respectively |
|
|
1,187,292 |
|
|
|
1,191,280 |
|
Construction in progress |
|
|
3,869 |
|
|
|
2,920 |
|
Goodwill |
|
|
34,495 |
|
|
|
31,987 |
|
Intangibles, net of accumulated amortization of $8,650 and $7,208, respectively |
|
|
25,949 |
|
|
|
27,390 |
|
Deferred costs and other assets |
|
|
25,885 |
|
|
|
19,993 |
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,505,107 |
|
|
$ |
1,464,450 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS EQUITY
|
Current liabilities: |
|
|
|
|
|
|
|
|
Current portion of long-term debt |
|
$ |
33,333 |
|
|
$ |
33,333 |
|
Accounts payable |
|
|
21,146 |
|
|
|
15,130 |
|
Income and other taxes payable |
|
|
5,019 |
|
|
|
4,066 |
|
Accrued personnel costs |
|
|
22,387 |
|
|
|
23,417 |
|
Accrued interest expense |
|
|
5,769 |
|
|
|
5,757 |
|
Other accrued liabilities |
|
|
8,225 |
|
|
|
7,676 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
95,879 |
|
|
|
89,379 |
|
|
|
|
|
|
|
|
Long-term debt |
|
|
286,463 |
|
|
|
293,095 |
|
Long-term income taxes: |
|
|
|
|
|
|
|
|
Deferred tax liabilities |
|
|
101,556 |
|
|
|
102,509 |
|
Other income taxes payable |
|
|
17,233 |
|
|
|
19,400 |
|
Cash flow hedge |
|
|
5,552 |
|
|
|
6,807 |
|
Other liabilities |
|
|
11,269 |
|
|
|
7,303 |
|
Stockholders equity: |
|
|
|
|
|
|
|
|
Preferred stock, no par value; 2,000 authorized; no shares issued |
|
|
|
|
|
|
|
|
Class A Common Stock, $0.01 par value; 60,000 shares authorized; 26,540 and 26,269 shares issued and 26,513 and 26,013 outstanding,
respectively; Class B Common Stock $0.01 per value; 60,000 shares authorized; no shares issued |
|
|
261 |
|
|
|
259 |
|
Additional paid-in capital |
|
|
374,978 |
|
|
|
370,218 |
|
Retained earnings |
|
|
548,592 |
|
|
|
536,468 |
|
Accumulated other comprehensive income |
|
|
64,488 |
|
|
|
39,137 |
|
Treasury stock, at cost |
|
|
(9,006 |
) |
|
|
(7,228 |
) |
Deferred compensation expense |
|
|
7,842 |
|
|
|
7,103 |
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
987,155 |
|
|
|
945,957 |
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
$ |
1,505,107 |
|
|
$ |
1,464,450 |
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
GULFMARK OFFSHORE, INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
|
|
(In thousands except per share amounts) |
|
Revenue |
|
$ |
96,911 |
|
|
$ |
92,782 |
|
|
$ |
178,200 |
|
|
$ |
177,433 |
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct operating expenses |
|
|
46,908 |
|
|
|
42,658 |
|
|
|
91,225 |
|
|
|
85,727 |
|
Drydock expense |
|
|
3,683 |
|
|
|
6,159 |
|
|
|
10,207 |
|
|
|
13,123 |
|
General and administrative expenses |
|
|
10,910 |
|
|
|
11,456 |
|
|
|
22,333 |
|
|
|
23,187 |
|
Depreciation and amortization |
|
|
14,982 |
|
|
|
13,977 |
|
|
|
29,658 |
|
|
|
27,952 |
|
Loss on sale of assets |
|
|
|
|
|
|
106 |
|
|
|
10 |
|
|
|
106 |
|
Impairment charge |
|
|
|
|
|
|
97,665 |
|
|
|
|
|
|
|
97,665 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
|
76,483 |
|
|
|
172,021 |
|
|
|
153,433 |
|
|
|
247,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
20,428 |
|
|
|
(79,239 |
) |
|
|
24,767 |
|
|
|
(70,327 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(5,630 |
) |
|
|
(5,062 |
) |
|
|
(11,357 |
) |
|
|
(10,051 |
) |
Interest income |
|
|
119 |
|
|
|
37 |
|
|
|
184 |
|
|
|
142 |
|
Foreign currency gain (loss) and other |
|
|
73 |
|
|
|
(1,020 |
) |
|
|
17 |
|
|
|
761 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other expense |
|
|
(5,438 |
) |
|
|
(6,045 |
) |
|
|
(11,156 |
) |
|
|
(9,148 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes |
|
|
14,990 |
|
|
|
(85,284 |
) |
|
|
13,611 |
|
|
|
(79,475 |
) |
Income tax (provision) benefit |
|
|
(1,699 |
) |
|
|
(5,447 |
) |
|
|
(1,487 |
) |
|
|
10,287 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
13,291 |
|
|
$ |
(90,731 |
) |
|
$ |
12,124 |
|
|
$ |
(69,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.51 |
|
|
$ |
(3.55 |
) |
|
$ |
0.47 |
|
|
$ |
(2.72 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
$ |
0.51 |
|
|
$ |
(3.55 |
) |
|
$ |
0.46 |
|
|
$ |
(2.72 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
25,829 |
|
|
|
25,546 |
|
|
|
25,754 |
|
|
|
25,470 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
25,949 |
|
|
|
25,546 |
|
|
|
25,885 |
|
|
|
25,470 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
GULFMARK OFFSHORE, INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
For the Six Months Ended June 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred |
|
|
|
|
|
|
|
|
|
|
Additional |
|
|
|
|
|
|
Accumulated Other |
|
|
|
|
|
|
|
|
|
|
Compen- |
|
|
Total |
|
|
|
Common |
|
|
Paid-In |
|
|
Retained |
|
|
Comprehensive |
|
|
|
|
|
|
|
|
|
|
sation |
|
|
Stockholders |
|
|
|
Stock |
|
|
Capital |
|
|
Earnings |
|
|
Income/(Loss) |
|
|
Treasury Stock |
|
|
Expense |
|
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Value |
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
Balance at December 31, 2010 |
|
$ |
259 |
|
|
$ |
370,218 |
|
|
$ |
536,468 |
|
|
$ |
39,137 |
|
|
|
(256 |
) |
|
$ |
(7,228 |
) |
|
$ |
7,103 |
|
|
$ |
945,957 |
|
Net income |
|
|
|
|
|
|
|
|
|
|
12,124 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,124 |
|
Issuance of common stock |
|
|
1 |
|
|
|
3,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,239 |
|
Exercise of stock options |
|
|
1 |
|
|
|
1,469 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,470 |
|
Deferred compensation plan |
|
|
|
|
|
|
53 |
|
|
|
|
|
|
|
|
|
|
|
(39 |
) |
|
|
(1,778 |
) |
|
|
739 |
|
|
|
(986 |
) |
Unrealized gain on cash flow hedge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
668 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
668 |
|
Translation adjustment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,683 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,683 |
|
|
|
|
Balance at June 30, 2011 |
|
$ |
261 |
|
|
$ |
374,978 |
|
|
$ |
548,592 |
|
|
$ |
64,488 |
|
|
|
(295 |
) |
|
$ |
(9,006 |
) |
|
$ |
7,842 |
|
|
$ |
987,155 |
|
|
|
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
GULFMARK OFFSHORE, INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
2011 |
|
|
2010 |
|
|
|
(In thousands) |
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
12,124 |
|
|
$ |
(69,188 |
) |
Adjustments to reconcile net income (loss) from operations
to net cash provided by operations: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
29,658 |
|
|
|
27,952 |
|
Loss on sale of assets |
|
|
10 |
|
|
|
106 |
|
Impairment charge |
|
|
|
|
|
|
97,665 |
|
Stock based compensation |
|
|
2,908 |
|
|
|
2,864 |
|
Deferred financing costs |
|
|
834 |
|
|
|
799 |
|
Provision for doubtful accounts receivable, net of write-offs |
|
|
(192 |
) |
|
|
939 |
|
Deferred income tax benefit |
|
|
(1,053 |
) |
|
|
(2,861 |
) |
Foreign currency transaction (gain) loss |
|
|
(314 |
) |
|
|
675 |
|
Change in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(16,623 |
) |
|
|
(3,725 |
) |
Prepaids and other |
|
|
(1,866 |
) |
|
|
(4,541 |
) |
Accounts payable |
|
|
5,665 |
|
|
|
(807 |
) |
Other accrued liabilities and other |
|
|
(6,109 |
) |
|
|
(10,495 |
) |
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
25,042 |
|
|
|
39,383 |
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Purchases of vessels, equipment and other fixed assets |
|
|
(4,934 |
) |
|
|
(63,179 |
) |
Proceeds from disposition of vessels and equipment |
|
|
|
|
|
|
890 |
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(4,934 |
) |
|
|
(62,289 |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds from borrowings |
|
|
10,000 |
|
|
|
|
|
Repayments of debt |
|
|
(16,666 |
) |
|
|
(16,667 |
) |
Debt refinancing cost |
|
|
|
|
|
|
(2,000 |
) |
Proceeds from exercise of stock options |
|
|
911 |
|
|
|
1,069 |
|
Proceeds from issuance of stock |
|
|
338 |
|
|
|
369 |
|
|
|
|
|
|
|
|
Net cash used in financing activities |
|
|
(5,417 |
) |
|
|
(17,229 |
) |
Effect of exchange rate changes on cash |
|
|
2,057 |
|
|
|
(2,150 |
) |
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents |
|
|
16,748 |
|
|
|
(42,285 |
) |
Cash and cash equivalents at beginning of the period |
|
|
97,195 |
|
|
|
92,079 |
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of the period |
|
$ |
113,943 |
|
|
$ |
49,794 |
|
|
|
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
Interest paid, net of interest capitalized |
|
$ |
9,693 |
|
|
$ |
9,069 |
|
|
|
|
|
|
|
|
Income taxes paid, net |
|
$ |
3,320 |
|
|
$ |
3,166 |
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6
GULFMARK OFFSHORE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(1) GENERAL INFORMATION
The condensed consolidated financial statements of GulfMark Offshore, Inc. and its
subsidiaries included herein have been prepared by us without audit, pursuant to the
rules and regulations of the Securities and Exchange Commission, or SEC. Unless otherwise
indicated, references to we, us, our and the Company refer collectively to GulfMark
Offshore, Inc. and its subsidiaries and predecessors. Certain information relating to our
organization and footnote disclosures normally included in financial statements prepared in
accordance with U.S. generally accepted accounting principles, or U.S. GAAP, has been condensed or
omitted in this Form 10-Q pursuant to such rules and regulations. However, we believe that the
disclosures herein are adequate to make the information presented not misleading. The consolidated
balance sheet as of December 31, 2010, has been derived from the audited financial statements at
that date but does not include all of the information and footnotes required by U.S. GAAP for
complete financial statements. It is recommended that these financial statements be read in
conjunction with our consolidated financial statements and notes thereto included in our
Form 10-K for the year ended December 31, 2010.
In the opinion of management, all adjustments, which include reclassification and normal
recurring adjustments necessary to present fairly the unaudited condensed consolidated financial
statements for the periods indicated have been made. All significant intercompany accounts have
been eliminated. Certain reclassifications of previously reported information may be made to
conform with current year presentation.
We provide offshore marine support and transportation services primarily to companies involved
in the offshore exploration and production of oil and natural gas. Our vessels transport materials,
supplies and personnel to offshore facilities, as well as move and position drilling structures.
The majority of our operations are conducted in the North Sea, offshore Southeast Asia and the
Americas. We also operate our vessels in other regions to meet our customers requirements.
Earnings Per Share
Basic Earnings Per Share, or EPS, is computed by dividing net income (loss) by the weighted
average number of shares of Class A Common Stock outstanding during the period. Diluted EPS is
computed using the treasury stock method for Class A Common Stock equivalents. The reconciliation
between basic and diluted earnings per share from income or loss attributable to Class A Common
Stock stockholders, including allocation to participating securities, is as follows:
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
(In thousands) |
|
(In thousands) |
|
|
|
|
|
Income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to common stockholders |
|
$ |
13,291 |
|
|
$ |
(90,731 |
) |
|
$ |
12,124 |
|
|
$ |
(69,188 |
) |
Undistributed income allocated to participating securities |
|
|
(121 |
) |
|
|
|
|
|
|
(141 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
13,170 |
|
|
|
(90,731 |
) |
|
|
11,983 |
|
|
|
(69,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Undistributed income allocated to participating securities |
|
|
121 |
|
|
|
|
|
|
|
141 |
|
|
|
|
|
Undistributed income reallocated to participating securities |
|
|
(120 |
) |
|
|
|
|
|
|
(140 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
$ |
13,171 |
|
|
$ |
(90,731 |
) |
|
$ |
11,984 |
|
|
$ |
(69,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding |
|
|
25,829 |
|
|
|
25,546 |
|
|
|
25,754 |
|
|
|
25,470 |
|
Dilutive effect of stock options and restricted stock awards |
|
|
120 |
|
|
|
|
|
|
|
131 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
25,949 |
|
|
|
25,546 |
|
|
|
25,885 |
|
|
|
25,470 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.51 |
|
|
$ |
(3.55 |
) |
|
$ |
0.47 |
|
|
$ |
(2.72 |
) |
Diluted |
|
$ |
0.51 |
|
|
$ |
(3.55 |
) |
|
$ |
0.46 |
|
|
$ |
(2.72 |
) |
(2) COMPREHENSIVE INCOME (LOSS)
The components of comprehensive income (loss), net of related tax for the three and six month
periods ending June 30, 2011 and 2010 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
|
|
(In thousands) |
|
|
(In thousands) |
|
|
|
|
|
|
Net income (loss) |
|
$ |
13,291 |
|
|
$ |
(90,731 |
) |
|
$ |
12,124 |
|
|
$ |
(69,188 |
) |
Comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) on cash flow hedge |
|
|
161 |
|
|
|
(464 |
) |
|
|
668 |
|
|
|
(1,018 |
) |
Foreign currency translation |
|
|
6,596 |
|
|
|
(23,811 |
) |
|
|
24,683 |
|
|
|
(49,294 |
) |
|
|
|
|
|
Total comprehensive income (loss) |
|
$ |
20,048 |
|
|
$ |
(115,006 |
) |
|
$ |
37,475 |
|
|
$ |
(119,500 |
) |
|
|
|
|
|
Our accumulated other comprehensive income (loss) item relates primarily to our
cumulative foreign currency translation adjustments and adjustments related to the cash flow
hedges.
8
(3) IMPAIRMENT CHARGE
Goodwill
Our goodwill consists of $34.5 million related to acquisitions in the North Sea region. The
determination of impairment of all long-lived assets, goodwill, and intangibles is conducted when
indicators of impairment are present and at least annually for goodwill. Impairment testing for
goodwill is performed on a reporting unit basis.
On July 1, 2008, we acquired a 100% ownership interest in a company that operated a large U.S.
Gulf of Mexico vessel fleet for $554.7 million, which included $97.7 million of goodwill. We
included this acquisition in our Americas segment. In the second quarter of 2010, we assessed our
Americas region goodwill for impairment. In our assessment, we evaluated the impact on the
segments fair value of events in the U.S. Gulf of Mexico, which included the April 20, 2010
explosion and fire on a deepwater drilling rig, the resulting oil spill and the U.S. Department of
Interior moratorium on deepwater drilling. We determined, based on our evaluations and testing as
prescribed under U.S. GAAP, that an impairment of our Americas region goodwill existed. As a
result, we recorded a $97.7 million impairment charge as of June 30, 2010, reflecting all of our
Americas region goodwill. The non-cash charge did not impact our liquidity or debt covenant
compliance.
(4) VESSEL ACQUISITIONS AND DISPOSITIONS
As of July 21, 2011, we have one vessel that is being held for sale that is not included in
our fleet numbers and have no vessels under construction.
Interest is capitalized in connection with the construction of vessels. We did not capitalize
any interest during the three or six month periods ended June 30, 2011. During the three and six
month periods ended June 30, 2010, $0.7 million and $1.3 million of interest, respectively, was
capitalized.
(5) INCOME TAXES
Our estimated annual effective tax rate, adjusted for unusual tax items, is applied
to interim periods pretax income (loss). Except for a portion of the current years foreign
earnings, which have been remitted to the U.S., we consider earnings of our foreign subsidiaries to
be permanently reinvested, and as such, we have not provided for any U.S. federal or state income
taxes on these permanently reinvested earnings.
(6) COMMITMENTS AND CONTINGENCIES
We have contingent liabilities and future claims for which we have made estimates of the
amount of the eventual cost to liquidate these liabilities or claims. These liabilities and claims
may involve threatened or actual litigation where damages have not been specifically quantified but
we have made an assessment of our exposure and recorded a provision in our accounts for the
expected loss. Other claims or liabilities, including those related to taxes in foreign
jurisdictions, may be estimated based on our experience in these matters and, where appropriate,
the advice of outside counsel or other outside experts. Upon the ultimate resolution of the
uncertainties surrounding our estimates of contingent liabilities and future claims, our future
reported financial results will be impacted by the difference, if any, between our estimates and
the actual amounts paid to settle the liabilities. In addition to estimates related to litigation
and
9
tax liabilities, other examples of liabilities requiring estimates of future exposure include
contingencies arising out of acquisitions and divestitures. Our contingent liabilities are based on
the most recent information available to us regarding the nature of the exposure. Such exposures
change from period to period based upon updated relevant facts and circumstances, which can cause
our estimates to change. In the recent past, our estimates for contingent liabilities have been
sufficient to cover the actual amount of our exposure. We do not believe that the outcome of these
matters will have a material adverse effect on our business, financial condition, or results of
operations.
(7) DERIVATIVE FINANCIAL INSTRUMENTS
Derivative instruments are accounted for at fair value. The accounting for changes in the fair
value of a derivative depends on the intended use and designation of the derivative instrument. For
a derivative instrument designated as a fair value hedge, the gain or loss on the derivative is
recognized in earnings in the period of change in fair value together with the offsetting gain or
loss on the hedged item. For a derivative instrument designated as a cash flow hedge, the effective
portion of the derivatives gain or loss is initially reported as a component of Other
Comprehensive Income (OCI) and is subsequently recognized in earnings when the hedged exposure
affects earnings. The ineffective portion of the gain or loss is recognized in current period
results of operations. Gains and losses from changes in fair values of derivatives that are not
designated as hedges for accounting purposes are recognized in current period results of
operations.
Using derivative instruments means assuming counterparty credit risk. Counterparty credit risk
relates to the loss we could incur if a counterparty were to default on a derivative contract. We
deal with investment grade counterparties and monitor the overall credit risk and exposure to
individual counterparties. We do not anticipate nonperformance by any counterparties. The amount of
counterparty credit exposure is the unrealized gains, if any, on such derivative contracts. We do
not require, nor do we post, collateral or security on such contracts.
Hedging Strategy
We are exposed to certain risks relating to our ongoing business operations. As a result, we
enter into derivative transactions to manage certain of these exposures that arise in the normal
course of business. The primary risks managed by using derivative instruments are foreign currency
exchange rate and interest rate risks. Fluctuations in these rates and prices can affect our
operating results and financial condition. We manage the exposure to these market risks through
operating and financing activities and through the use of derivative financial instruments. We do
not enter into derivative financial instruments for trading or speculative purposes.
We periodically enter into foreign currency forward contracts which are designated as fair
value hedges and are highly effective, as the terms of the forward contracts are the same as the
purchase commitments under the related contract. Any gains or losses resulting from changes in fair
value are recognized in income with an offsetting adjustment to income for changes in the fair
value of the hedged item such that there is no net impact in the consolidated statements of
operations. As of June 30, 2011, we had no open foreign currency forward contracts.
We entered into an interest rate swap with the objective of reducing our exposure to interest
rate risk for $100.0 million of our $200.0 million Facility Agreement variable-rate
10
debt. At June 30, 2011, our interest rate derivative instrument has an outstanding notional amount
of $100.0 million and is designated as a cash flow hedge. The terms of this swap, including reset
dates and floating rate indices, match those of our underlying variable-rate debt and no
ineffectiveness has been recorded.
Early Hedge Settlement
During December 2009, we cash settled certain interest rate swap contracts prior to their
scheduled settlement dates. As a result of these transactions, we paid $6.4 million in cash, which
represented the fair value of these contracts at the date of settlement. Unrecognized losses of
$1.0 million are recorded as of June 30, 2011 in accumulated OCI related to these interest rate
swap contracts. This balance will be amortized into interest expense through December 31, 2012
based on forecasted payments as of the settlement date.
The following table quantifies the fair values, on a gross basis, of all our derivative
contracts and identifies the balance sheet location as of June 30, 2011 and December 31, 2010
(dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Derivatives |
|
|
Liability Derivatives |
|
|
|
June 30, 2011 |
|
|
December 31,2010 |
|
|
June 30, 2011 |
|
|
December 31, 2010 |
|
|
|
Balance |
|
|
|
|
|
|
Balance |
|
|
|
|
|
|
Balance |
|
|
|
|
|
|
Balance |
|
|
|
|
Derivatives designed as |
|
Sheet |
|
|
Fair |
|
|
Sheet |
|
|
Fair |
|
|
Sheet |
|
|
Fair |
|
|
Sheet |
|
|
Fair |
|
hedging instruments |
|
Location |
|
|
Value |
|
|
Location |
|
|
Value |
|
|
Location |
|
|
Value |
|
|
Location |
|
|
Value |
|
|
|
|
|
|
|
|
|
|
Interest rate swaps |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow hedges |
|
$ |
5,552 |
|
|
Cash flow hedges |
|
$ |
6,807 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
$ |
5,552 |
|
|
|
|
|
|
$ |
6,807 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following tables quantify the amount of gain or loss recognized during the three and six
months ended June 30, and identify the consolidated statement of operations location:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Location of Gain or (Loss) |
|
Amount of Gain or (Loss) |
|
|
Amount of Gain or (Loss) |
|
Reclassified from |
|
Reclassified from |
Derivatives in cash flow |
|
Recognized in OCI on |
|
Accumulated OCI into |
|
Accumulated OCI into |
hedging relationships |
|
Derivative |
|
Income |
|
Income |
|
|
Six Months Ended June 30, |
|
|
|
|
|
Six Months Ended June 30, |
|
|
2011 |
|
2010 |
|
|
|
|
|
2011 |
|
2010 |
|
|
(in thousands) |
|
|
|
|
|
(in thousands) |
Interest rate contracts |
|
$ |
(676 |
) |
|
$ |
(3,202 |
) |
|
Interest expense |
|
$ |
(1,540 |
) |
|
$ |
(1,317 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
|
|
|
Three Months Ended June 30, |
|
|
2011 |
|
2010 |
|
|
|
|
|
2011 |
|
2010 |
|
|
(in thousands) |
|
|
|
|
|
(in thousands) |
Interest rate contracts |
|
$ |
(578 |
) |
|
$ |
(1,552 |
) |
|
Interest expense |
|
|
$(787 |
) |
|
|
$(657 |
) |
11
(8) FAIR VALUE MEASUREMENTS
Each asset and liability required to be carried at fair value is classified under one of the
following criteria:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs that are not corroborated by market data.
We have a fixed-for-floating interest rate swap agreement that has the effect of fixing the
LIBOR interest rate component on $100.0 million of the outstanding balance on our $200.0 million
Facility Agreement. The fixed rate component of the swap is set at 4.145% and the swap matures with
the Facility Agreement on December 31, 2012. The interest rate swap is accounted for as a cash flow
hedge. The consolidated balance sheet discloses the cash flow hedge in the liability section,
reflecting the fair value of the interest rate swap which was $5.6 million at June 30, 2011. For
the three and six month periods ended June 30, 2011, $0.4 and $0.8 million related to this interest
rate swap was reclassified from other comprehensive income to interest expense, respectively. We
expect to reclassify $3.4 million of deferred losses related to this interest rate swap and the
previously settled interest rate swap to interest expense during the next 12 months. We recognize
the fair value of our derivative swaps as a Level 2 valuation. We determined the fair value of our
interest rate swap based on the contractual fixed rate in the swap agreement and the forward curve
of three month LIBOR supplied by the bank as of June 30, 2011.
The following table presents information about our assets (liabilities) measured at fair value
on a recurring basis as of June 30, 2011, and indicates the fair value hierarchy we utilized to
determine such fair value (in millions).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
Cash Flow Hedges |
|
$ |
|
|
|
$ |
5.6 |
|
|
$ |
|
|
|
$ |
5.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents information about our assets (liabilities) measured at fair
value on a recurring basis as of December 31, 2010, and indicates the fair value hierarchy we
utilized to determine such fair value (in millions).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
Cash Flow Hedges |
|
$ |
|
|
|
$ |
6.8 |
|
|
$ |
|
|
|
$ |
6.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(9) NEW ACCOUNTING PRONOUNCEMENTS
In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards
Update (ASU) No. 2011-04, Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair
Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS, (ASU 2011-04). ASU 2011-04
changes the wording used to describe many of the requirements in U.S. GAAP for measuring fair value
and for disclosing information about fair value measurements to ensure consistency between U.S.
GAAP and International Financial Reporting Standards (IFRS). ASU 2011-04 also expands the
disclosures for fair value measurements that are estimated using significant unobservable (Level 3)
inputs. This new guidance is to be applied prospectively. ASU 2011-04 will be effective for interim
and annual
12
periods beginning after Dec. 15, 2011, with early adoption permitted. We believe that the adoption
of this standard will not materially expand our consolidated financial statement footnote
disclosures.
In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (ASC Topic 220):
Presentation of Comprehensive Income, (ASU 2011-05) which amends current comprehensive income
guidance. This ASU eliminates the option to present the components of other comprehensive income
as part of the statement of shareholders equity. Instead, we must report comprehensive income in
either a single continuous statement of comprehensive income which contains two sections, net
income and other comprehensive income, or in two separate but consecutive statements. ASU 2011-05
will be effective for interim and annual periods beginning after Dec. 15, 2011, with early adoption
permitted. The adoption of ASU 2011-05 will not have a material impact on our consolidated
financial statements.
(10) OPERATING SEGMENT INFORMATION
We operate three segments: the North Sea, Southeast Asia and the Americas, each of which is
considered a reportable segment under FASB ASC 280, Segment Reporting. Our management evaluates
segment performance primarily based on operating income. Cash and debt are managed centrally.
Because the regions do not manage those items, the gains and losses on foreign currency
remeasurements associated with these items are excluded from operating income. Our management
considers segment operating income to be a good indicator of each segments operating performance
from its continuing operations, as it represents the results of the ownership interest in
operations without regard to financing methods or capital structures. Each operating segments
operating income (loss) is summarized in the following table, and detailed discussions below.
13
Operating Income (Loss) by Operating Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North |
|
|
Southeast |
|
|
|
|
|
|
|
|
|
|
|
|
Sea |
|
|
Asia |
|
|
Americas |
|
|
Other |
|
|
Total |
|
|
|
(In thousands) |
|
|
|
Quarter Ended June 30, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
43,836 |
|
|
$ |
15,678 |
|
|
$ |
37,397 |
|
|
$ |
|
|
|
$ |
96,911 |
|
Direct operating expenses |
|
|
20,727 |
|
|
|
2,887 |
|
|
|
23,294 |
|
|
|
|
|
|
|
46,908 |
|
Drydock expense |
|
|
2,371 |
|
|
|
1,755 |
|
|
|
(443 |
) |
|
|
|
|
|
|
3,683 |
|
General and administrative expenses |
|
|
2,689 |
|
|
|
761 |
|
|
|
1,930 |
|
|
|
5,530 |
|
|
|
10,910 |
|
Depreciation and amortization expense |
|
|
4,970 |
|
|
|
2,431 |
|
|
|
7,132 |
|
|
|
449 |
|
|
|
14,982 |
|
|
|
|
Operating income (loss) |
|
$ |
13,079 |
|
|
$ |
7,844 |
|
|
$ |
5,484 |
|
|
$ |
(5,979 |
) |
|
$ |
20,428 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended June 30, 2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
37,217 |
|
|
$ |
16,841 |
|
|
$ |
38,724 |
|
|
$ |
|
|
|
$ |
92,782 |
|
Direct operating expenses |
|
|
19,299 |
|
|
|
2,385 |
|
|
|
20,974 |
|
|
|
|
|
|
|
42,658 |
|
Drydock expense |
|
|
1,489 |
|
|
|
1,637 |
|
|
|
3,033 |
|
|
|
|
|
|
|
6,159 |
|
General and administrative expenses |
|
|
2,700 |
|
|
|
763 |
|
|
|
2,361 |
|
|
|
5,632 |
|
|
|
11,456 |
|
Depreciation and amortization expense |
|
|
4,624 |
|
|
|
2,036 |
|
|
|
7,084 |
|
|
|
233 |
|
|
|
13,977 |
|
(Gain) loss on sale of assets |
|
|
|
|
|
|
|
|
|
|
109 |
|
|
|
(3 |
) |
|
|
106 |
|
Impairment charge |
|
|
|
|
|
|
|
|
|
|
97,665 |
|
|
|
|
|
|
|
97,665 |
|
|
|
|
Operating income (loss) |
|
$ |
9,105 |
|
|
$ |
10,020 |
|
|
$ |
(92,502 |
) |
|
$ |
(5,862 |
) |
|
$ |
(79,239 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North |
|
|
Southeast |
|
|
|
|
|
|
|
|
|
|
|
|
Sea |
|
|
Asia |
|
|
Americas |
|
|
Other |
|
|
Total |
|
|
|
(In thousands) |
|
|
|
Six Months Ended June 30, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
79,235 |
|
|
$ |
31,213 |
|
|
$ |
67,752 |
|
|
$ |
|
|
|
$ |
178,200 |
|
Direct operating expenses |
|
|
41,441 |
|
|
|
5,749 |
|
|
|
44,035 |
|
|
|
|
|
|
|
91,225 |
|
Drydock expense |
|
|
5,441 |
|
|
|
1,940 |
|
|
|
2,826 |
|
|
|
|
|
|
|
10,207 |
|
General and administrative expenses |
|
|
5,923 |
|
|
|
1,435 |
|
|
|
4,199 |
|
|
|
10,776 |
|
|
|
22,333 |
|
Depreciation and amortization expense |
|
|
9,757 |
|
|
|
4,882 |
|
|
|
14,238 |
|
|
|
781 |
|
|
|
29,658 |
|
Loss on sale of assets |
|
|
|
|
|
|
|
|
|
|
10 |
|
|
|
|
|
|
|
10 |
|
|
|
|
Operating income (loss) |
|
$ |
16,673 |
|
|
$ |
17,207 |
|
|
$ |
2,444 |
|
|
$ |
(11,557 |
) |
|
$ |
24,767 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
72,492 |
|
|
$ |
32,668 |
|
|
$ |
72,273 |
|
|
$ |
|
|
|
$ |
177,433 |
|
Direct operating expenses |
|
|
39,465 |
|
|
|
4,710 |
|
|
|
41,552 |
|
|
|
|
|
|
|
85,727 |
|
Drydock expense |
|
|
3,519 |
|
|
|
3,583 |
|
|
|
6,021 |
|
|
|
|
|
|
|
13,123 |
|
General and administrative expenses |
|
|
5,521 |
|
|
|
1,362 |
|
|
|
4,547 |
|
|
|
11,757 |
|
|
|
23,187 |
|
Depreciation and amortization expense |
|
|
9,284 |
|
|
|
4,001 |
|
|
|
14,212 |
|
|
|
455 |
|
|
|
27,952 |
|
(Gain) loss on sale of assets |
|
|
|
|
|
|
|
|
|
|
109 |
|
|
|
(3 |
) |
|
|
106 |
|
Impairment charge |
|
|
|
|
|
|
|
|
|
|
97,665 |
|
|
|
|
|
|
|
97,665 |
|
|
|
|
Operating income (loss) |
|
$ |
14,703 |
|
|
$ |
19,012 |
|
|
$ |
(91,833 |
) |
|
$ |
(12,209 |
) |
|
$ |
(70,327 |
) |
|
|
|
14
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
We provide marine support and transportation services to companies involved in the offshore
exploration and production of oil and natural gas. Our vessels transport drilling materials,
supplies and personnel to offshore facilities, as well as move and position drilling structures. A
substantial portion of our operations are international. Our fleet has grown in both size and
capability, from an original 11 vessels in 1990 to our present number of 89 active vessels, through
strategic acquisitions and the new construction of technologically advanced vessels, partially
offset by dispositions of certain older, less profitable vessels. At July 21, 2011, our active
fleet includes 74 owned vessels and 15 managed vessels.
Our results of operations are affected primarily by day rates, fleet utilization and the
number and type of vessels in our fleet. Utilization and day rates, in turn, are influenced
principally by the demand for vessel services from the exploration and production sectors of the
oil and natural gas industry. The supply of vessels to meet this fluctuating demand is related
directly to the perception of future activity in both the drilling and production phases of the oil
and natural gas industry as well as the availability of capital to build new vessels to meet the
changing market requirements. From time to time, we bareboat charter vessels with revenue and
operating expenses reported in the same income and expense categories as our owned vessels. The
chartered vessels, however, incur bareboat charter fees instead of depreciation expense. Bareboat
charter fees are generally higher than the depreciation expense on owned vessels of similar age and
specification. The operating income realized from these vessels is therefore adversely affected by
the higher costs associated with the bareboat charter fees. These vessels are included in
calculating fleet day rates and utilization in the applicable periods.
We also provide management services to other vessel owners for a fee. We do not include
charter revenue and vessel expenses of these vessels in our operating results; however, management
fees are included in operating revenue. These vessels are excluded for purposes of calculating
fleet rates per day worked and utilization in the applicable periods.
The operations of our fleet may be subject to seasonal factors. Operations in the North Sea
are often at their highest levels from April to August, and at their lowest levels from November to
February. Operations in our other areas, although involving some seasonal factors, tend to remain
more consistent throughout the year.
Our operating costs are primarily a function of fleet configuration. The most significant
direct operating cost is wages paid to vessel crews, followed by maintenance and repairs and
insurance. Generally, fluctuations in vessel utilization have little effect on direct operating
costs in the short term and, as a result, direct operating costs as a percentage of revenue may
vary substantially due to changes in day rates and utilization.
In addition to direct operating costs, we incur fixed charges related to (i) the depreciation
of our fleet, (ii) costs for routine drydock inspections, (iii) modifications designed to ensure
compliance with applicable regulations, and (iv) maintaining certifications for our vessels with
various international classification societies. The number of drydockings and other repairs
undertaken in a given period generally determines our maintenance and repair expenses. The demands
of the market, the expiration of existing contracts, the start of new contracts, seasonal factors
and customer preferences influence the timing of drydocks. During the first six months of 2011, we
completed 319 drydock days, compared to 337 drydock days completed in the same period last year.
15
Critical Accounting Policies
There have been no changes to the critical accounting policies used in our reporting of
results of operations and financial position. For a discussion of our critical accounting policies
see Managements Discussion and Analysis of Financial Condition and Results of Operations in our
Form 10-K for the year ended December 31, 2010.
Goodwill
Our goodwill consists of $34.5 million related to acquisitions in the North Sea region. The
determination of impairment of all long-lived assets, goodwill, and intangibles is conducted when
indicators of impairment are present and at least annually for goodwill. Impairment testing for
goodwill is performed on a reporting unit basis.
On July 1, 2008, we acquired a 100% ownership interest in a company that operated a large U.S.
Gulf of Mexico vessel fleet for $554.7 million, which included $97.7 million of goodwill. We
included this acquisition in our Americas segment. In the second quarter of 2010, we assessed our
Americas region goodwill for impairment. In our assessment, we evaluated the impact on the
segments fair value of events in the U.S. Gulf of Mexico, which includes the April 20, 2010
explosion and fire on a deepwater drilling rig, the resulting oil spill and the U.S. Department of
Interior moratorium on deepwater drilling. We determined, based on our evaluations and testing as
prescribed under U.S. GAAP, that an impairment of our Americas region goodwill existed. As a
result, we recorded a $97.7 million impairment charge as of June 30, 2010, reflecting all of our
Americas region goodwill. The non-cash charge did not impact our liquidity or debt covenant
compliance.
Results of Operations
The table below sets forth, by region, the average day rates and utilization for our vessels
and the average number of vessels owned or chartered during the periods indicated. This fleet
generates substantially all of our revenues and operating profit. We use the information that
follows to evaluate the performance of our business.
16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
|
|
|
Revenues by Region (000s) (a): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North Sea Based Fleet (c) |
|
$ |
43,836 |
|
|
$ |
37,217 |
|
|
$ |
79,235 |
|
|
$ |
72,492 |
|
Southeast Asia Based Fleet |
|
|
15,678 |
|
|
|
16,841 |
|
|
|
31,213 |
|
|
|
32,668 |
|
Americas Based Fleet |
|
|
37,397 |
|
|
|
38,724 |
|
|
|
67,752 |
|
|
|
72,273 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rates Per Day Worked (a) (b): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North Sea Based Fleet (c) |
|
$ |
20,014 |
|
|
$ |
16,478 |
|
|
$ |
18,951 |
|
|
$ |
16,621 |
|
Southeast Asia Based Fleet |
|
|
15,228 |
|
|
|
16,817 |
|
|
|
15,238 |
|
|
|
17,387 |
|
Americas Based Fleet |
|
|
14,217 |
|
|
|
13,486 |
|
|
|
14,207 |
|
|
|
13,428 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Overall Utilization (a) (b): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North Sea Based Fleet |
|
|
94.1 |
% |
|
|
95.1 |
% |
|
|
90.6 |
% |
|
|
94.5 |
% |
Southeast Asia Based Fleet |
|
|
83.0 |
% |
|
|
92.8 |
% |
|
|
83.1 |
% |
|
|
88.0 |
% |
Americas Based Fleet |
|
|
84.3 |
% |
|
|
91.7 |
% |
|
|
77.4 |
% |
|
|
85.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Owned/Chartered Vessels (a) (d): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North Sea Based Fleet (c) |
|
|
25.0 |
|
|
|
25.2 |
|
|
|
25.0 |
|
|
|
24.8 |
|
Southeast Asia Based Fleet |
|
|
14.0 |
|
|
|
12.1 |
|
|
|
14.0 |
|
|
|
12.1 |
|
Americas Based Fleet |
|
|
35.0 |
|
|
|
35.3 |
|
|
|
35.0 |
|
|
|
35.7 |
|
|
|
|
|
|
Total |
|
|
74.0 |
|
|
|
72.6 |
|
|
|
74.0 |
|
|
|
72.6 |
|
|
|
|
|
|
|
|
|
(a) |
|
Includes all owned or bareboat chartered vessels. |
|
(b) |
|
Rate per day worked is defined as total charter revenues divided by number of days worked.
Utilization rate is defined as the total days worked divided by total days of availability in
the period. |
|
(c) |
|
Revenues for vessels in the North Sea based fleet are primarily earned in Pound Sterling
(GBP), Norwegian Kroner (NOK) and Euros, and have been converted to U.S. Dollars (US$) at the
average exchange rate for the period. The average equivalent exchange rate per one US$ for
the periods indicated is as shown in Managements Discussion and Analysis of Financial
Condition and Results of Operations Currency Fluctuations and Inflation on page 21. |
|
(d) |
|
Average number of vessels is calculated based on the aggregate number of vessel days
available during each period divided by the number of calendar days in such period. Includes
owned and bareboat vessels only, and is adjusted for vessel additions and dispositions
occurring during each period. |
Comparison of the Three Months Ended June 30, 2011 with the Three Months Ended June 30, 2010
For the quarter ended June 30, 2011, net income was $13.3 million, or $0.51 per diluted share
on revenues of $96.9 million. For the same 2010 period, we had a net loss of $90.7 million, or
$3.55 per diluted share on revenues of $92.8 million. Included in the loss was a $97.7 million, or
$3.82 per diluted share, goodwill impairment charge.
Our revenues for the quarter ended June 30, 2011 increased $4.1 million or 4.5% compared to
the second quarter of 2010. The increase in revenue was due mainly to a combination of currency
effects and an increase in average day rates from $15,101 in the second quarter of 2010 to $16,508
in the current year quarter, which contributed an $8.2 million increase for the quarter. Increased
capacity during the quarter contributed an additional $0.4 million. The increase was partially
offset by a decrease in utilization rates during the current quarter compared
17
to the second quarter of 2010. Overall utilization decreased from 93.0% in the prior year
quarter to 87.4% in the current year quarter and negatively impacted revenue by $4.5 million.
Operating income for the period was $20.4 million compared to $18.4 million, excluding the
impairment charge, for the prior year quarter. The increase is due primarily to the increase in
revenue, offset by higher direct operating cost. General and administrative cost was also lower
than the 2010 quarter, due mainly to lower professional fees and bad debt expense.
North Sea
Revenues in the North Sea region increased by $6.6 million, or 18%, to $43.8 million in the
second quarter of 2011 compared to the same period of 2010. Approximately $7.1 million of the
increase was a result of a combination of currency effects and an increase in day rates. Day rates
increased from $16,478 in the prior year quarter to $20,014 in the second quarter of 2011.
Utilization rates decreased slightly from 95.1% in the second quarter of 2010 to 94.1% in the
current year quarter, however the mix of days worked associated with vessels with higher day rates
resulted in a $0.3 million increase in revenue. The overall revenue increase was partially offset
by decreased capacity as a result of the sale of a vessel during 2010, which negatively impacted
revenue by $0.8 million. Operating income increased by $4.0 million compared to the prior year
quarter due to the increase in revenue offset partially by increased direct operating expenses and
higher depreciation expense due mainly to foreign currency effects. Drydock expense also increased
by $1.4 million as we experienced 12 more drydock days. General and administrative expense in the
second quarter of 2011 was unchanged from the prior year quarter.
Southeast Asia
Revenues for our Southeast Asia based fleet decreased from the prior year quarter by $1.2
million, or 7%, to $15.7 million. The decrease was primarily attributable to a decrease in day
rates from $16,817 in the prior year quarter to $15,228 in the current quarter, which reduced
revenue by $1.8 million. Utilization for the second quarter of 2011 decreased from 92.8% to 83.0%
in the current quarter reducing revenue by $0.8 million. Capacity increased revenue by $1.5 million
as a result of the addition of two new vessels during the second and third quarters of 2010.
Operating income for Southeast Asia was $7.8 million in the second quarter of 2011 compared to
$10.0 million in the prior year quarter. The decrease is due mainly to the decrease in revenue
coupled with an increase in direct operating expense and higher depreciation expense due to the
addition of the two new vessels. General and administrative expense remained unchanged from the
prior year quarter.
Americas
Revenues in the Americas region decreased by $1.3 million, or 3%, to $37.4 million in the
second quarter of 2011 compared to the same prior year quarter. Utilization decreased from 91.7%
in the second quarter of 2010 to 84.3% in the current year quarter which decreased revenue by $4.0
million. The utilization decrease is a direct result of tightened regulations in the U.S. Gulf of
Mexico. In addition, reduced capacity negatively impacted revenue by $0.3 million as a result of
the sale of a vessel during the second quarter of 2010. The combination of day rates and currency
effects positively impacted revenue by $3.0 million as average day rates increased from $13,486 in
the second quarter of 2010 to $14,217 in the current year quarter. Operating income was $5.5
million in the second quarter of 2011 compared to an operating loss of $92.5 million in the prior
year quarter. The 2010 operating loss included a $97.7 million charge related to the impairment of
goodwill. Absent this charge, the region generated operating
18
income of $5.2 million. The increase in operating income is due mainly to a $3.5 million decrease
in drydock costs offset by a $2.3 million increase in direct operating costs coupled with the
decrease in revenues of $1.3 million. General and administrative expense was lower than the prior
year quarter due mainly to the reduction in bad debt expense.
Other
Other expenses in the second quarter of 2011 decreased by $0.6 million compared to the prior
year quarter, resulting primarily from the $1.1 million positive effect of foreign currency offset
by higher interest expense due to lower capitalized interest.
Income Taxes
Our effective tax rate for the second quarter of 2011 was 8.4% excluding unusual items. This
compares to a 4.7% effective tax rate in the second quarter of 2010, excluding unusual items. The
change in the effective tax rate from the prior year was primarily attributable to inclusion of the
U.S. tax impact for remitting a portion of our 2011 foreign earnings.
Comparison of the Six Months Ended June 30, 2011 with the Six Months Ended June 30, 2010
For the six months ended June 30, 2011 net income was $12.1 million, or $0.46 per diluted
share on revenues of $178.2 million. During the same period in 2010, we had a net loss of $69.2
million or $2.72 per diluted share, on revenues of $177.4 million. The 2010 net loss included a
$97.7 million goodwill impairment charge.
Revenue increased $0.8 million period over period due to higher dayrates, positive currency
effects, and increased capacity as we benefited from the effect of the prior year vessel
deliveries, offset by lower average utilization rates.
Operating income for the six-month period ended June 30, 2011 was $24.8 million compared to
$27.3 million in 2010, absent the goodwill impairment charge. The decrease is primarily due to
increased direct operating expenses and depreciation expense due primarily to the increase in
vessels partially offset by lower drydock expense and slightly higher revenues in 2011. General
and administrative expense was also lower than the 2010 period due primarily to lower professional
fees.
North Sea
North Sea revenue increased by $6.7 million, or 9%, in the first six months of 2011 compared
to 2010. The effect of the weakening U.S. Dollar increased revenue by $4.5 million, coupled with
an increase in average day rates from $16,621 in 2010 to $18,951 in 2011, which contributed $5.3
million to the increase in revenue. This was partially offset by a decrease in average utilization
rates from 94.5% in 2010 to 90.6% in 2011, and a reduction in capacity, which together decreased
revenue by $3.1 million. Operating income increased by $2.0 million resulting primarily from
increased revenue, offset by higher direct operating cost and depreciation expense. Drydock
expense also increased by $1.9 million from the 2010 period due to an increase in drydock days.
General and administrative expense was higher than the 2010 period due mainly to an increase in
professional fees.
19
Southeast Asia
Revenue for our Southeast Asia based fleet decreased by $1.5 million, or 5%, from $32.7
million in the first six months of 2010 to $31.2 million in the same 2011 period. The decrease was
primarily attributable to a decrease in average day rates, offset by an increase in capacity. Day
rates decreased from $17,387 in 2010 to $15,238 in 2011, which decreased revenue by $5.3 million.
The increase in fleet size as a result of two vessel deliveries in 2010 contributed $2.9 million to
revenue. Utilization rates decreased from 88.0% in 2010 to 83.1% in the current year, however the
mix of days worked associated with higher day rate vessels resulted in a $1.0 million increase in
revenue. Operating income decreased from $19.0 million in 2010 to $17.2 million this year. The
decrease resulted mainly from the lower revenues coupled with higher direct operating and
depreciation expense due to the additional vessels, offset by lower drydock costs, as a result of
lower drydock days. General and administrative expense had no significant change from the 2010
period.
Americas
Our Americas region revenue decreased $4.5 million, or 6%, from $72.3 million in 2010 to $67.8
million in 2011. Utilization decreased from 85.7% to 77.4% resulting in a $9.0 million decrease in
revenues. The lower utilization was a direct result of tightened regulations in the U.S. Gulf of
Mexico. Capacity contributed $1.4 million to the decrease in revenue as a result of one vessel
sale during 2010. An increase in day rates from $13,428 in 2010 to $14,207 in 2011, coupled with
the foreign currency impact, increased revenue by $5.9 million. Operating income was $2.4 million
during the first six months of 2011 compared to $5.8 million in 2010, absent the impairment charge.
The decrease is due primarily to the decrease in revenue coupled with higher direct operating
cost. Drydock costs decreased $3.2 million as a result of significantly lower drydock costs per
day. General and administrative expense also decreased by $0.3 million due primarily to the
decrease in bad debt expense.
Other
In the six months ended June 30, 2011, other expenses totaled $11.2 million, an increase of
$2.0 million from 2010. The increase was due primarily to higher interest expense due to lower
capitalized interest, partially offset by a decrease in foreign currency gains of $0.7 million.
Income Taxes
Our effective tax rate for the first half of 2011 was 8.3% excluding unusual items. This
compares to a 0.3% effective tax rate for the first six months of 2010, excluding unusual items.
The change in the effective tax rate from the prior year was primarily attributable to inclusion of
the U.S. tax impact for remitting a portion of our 2011 foreign earnings.
Liquidity, Capital Resources and Financial Condition
Our ongoing liquidity requirements are generally associated with our need to service debt,
fund working capital, maintain our fleet, finance the construction of new vessels and acquire or
improve equipment or vessels. We plan to continue to be active in the acquisition of additional
vessels through both the resale market and new construction. Bank financing, equity capital and
internally generated funds have historically provided funding for these activities. Internally
generated funds are directly related to fleet activity and vessel day rates, which are generally
dependent upon the demand for our vessels which is ultimately determined by the
20
supply and demand
for offshore drilling for crude oil and natural gas.
We completed our most recent vessel construction program in 2010 and have no new vessel
construction commitments for 2011 or any future years. Interest expense at current rates under our
existing debt arrangements, assuming no additional borrowings, is expected to approximate $23.0
million for 2011. Minimum repayments under our existing debt arrangements will be $33.3 million for
2011. These amounts are anticipated to be paid from a combination of cash on hand and cash from
operations.
In addition, we are required to make expenditures for the certification and maintenance of our
vessels. We expect our drydocking expenditures to be $16.7 million in 2011.
Net working capital at June 30, 2011, was $131.7 million, including $113.9 million in cash.
Net cash provided by operating activities was $20.0 million for the three months ended June 30,
2011. For the quarter ended June 30, 2011, net cash used in investing activities was $3.4 million,
and net cash used in financing activities was $8.2 million.
At June 30, 2011, we had approximately $113.9 million of cash on hand and $10.0 million drawn
under our $175.0 million Revolving Loan Facility, $150.0 million borrowed under our Facility
Agreement, and $160.0 million outstanding under our Senior Notes.
As of June 30, 2011, substantially all of our cash and cash equivalents were held by our
foreign subsidiaries. It is our current intention to permanently reinvest all of our earnings
generated outside the U.S. prior to December 31, 2010 that through that date had not been remitted
(unremitted earnings), and as such we have not provided for U.S. income tax expense on these
unremitted earnings. If any portion of these unremitted earnings were ever foreseen to not be
permanently reinvested outside the U.S., U.S. income tax expense would be required to be recognized
and that expense could be material.
We anticipate that cash on hand and future cash flow from operations for 2011 will be adequate
to repay our debts due and payable during such period, to complete scheduled drydockings, to make
normal recurring capital additions and improvements and to meet operating and working capital
requirements. This expectation, however, is dependent upon the success of our operations.
Currency Fluctuations and Inflation
A majority of our operations are international; therefore we are exposed to currency
fluctuations and exchange rate risks. In areas where currency risks are potentially high, we
normally accept only a small percentage of charter hire in local currency, with the remainder paid
in U.S. Dollars. Operating costs are substantially denominated in the same currency as charter hire
in order to reduce the risk of currency fluctuations. Charters for vessels in our North Sea fleet
are primarily denominated in Pounds Sterling (GBP), with a portion denominated in Norwegian Kroner
(NOK) or Euros. The North Sea fleet generated 45.2% of our total consolidated revenue and $13.1
million in operating income for the three months ended June 30, 2011, and 44.5% of our total
consolidated revenue and $16.7 million in operating income for the six months ended June 30, 2011.
In the second quarter of 2011, the exchange rates of GBP, NOK and Euros against the U.S. Dollar
averaged as follows:
21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
|
|
1 US$= |
|
|
1 US$= |
|
GBP |
|
|
0.613 |
|
|
|
0.670 |
|
|
|
0.618 |
|
|
|
0.655 |
|
NOK |
|
|
5.437 |
|
|
|
6.217 |
|
|
|
5.577 |
|
|
|
6.034 |
|
Euro |
|
|
0.695 |
|
|
|
0.748 |
|
|
|
0.712 |
|
|
|
0.753 |
|
Our outstanding debt is denominated in U.S. Dollars, but a substantial portion of our
revenue is generated in currencies other than the U.S. Dollar. We have evaluated these conditions
and have determined that it is not in our best interest to use any financial instruments to hedge
this exposure under present conditions. Our strategy is in part based on a number of factors
including the following:
|
|
|
the cost of using hedging instruments in relation to the risks of currency fluctuations; |
|
|
|
|
the propensity for adjustments in these foreign currency denominated vessel day rates
over time to compensate for changes in the purchasing power of these currencies as measured
in U.S. Dollars; |
|
|
|
|
the level of U.S. Dollar-denominated borrowings available to us; and |
|
|
|
|
the conditions in our U.S. Dollar-generating regional markets. |
One or more of these factors may change and, in response, we may begin to use financial
instruments to hedge risks of currency fluctuations. We will from time to time hedge known
liabilities denominated in foreign currencies to reduce the effects of exchange rate fluctuations
on our financial results, such as a fair value hedge associated with the construction of vessels.
In this regard, in 2007, we entered into forward currency contracts to specifically hedge the
foreign currency exposure related to firm contractual commitments in the form of future vessel
payments. As a result, by design, there was exact offset between the gain or loss exposure in the
related underlying contractual commitment. These contracts expired in early 2010 and there are no
outstanding contracts at June 30, 2011. See Part I, Items 1 and 2 Business and Properties New
Vessel Construction, Acquisition and Divestiture Program, and Drydocking Obligations of our Form
10-K for the year ended December 31, 2010 for more details. We do not use foreign currency forward
contracts for trading or speculative purposes.
Reflected in the accompanying consolidated balance sheet at June 30, 2011, is $64.5 million in
accumulated other comprehensive income primarily relating to the change in exchange rates at June
30, 2011 in comparison with the exchange rates when we invested capital in these markets.
Accumulated other comprehensive income related to the changes in foreign currency exchange rates
was $67.2 million at June 30, 2011. Also included in accumulated other comprehensive income was a
loss of $2.7 million related to our cash flow hedges. Changes in the other comprehensive income
are non-cash items that are primarily attributable to investments in vessels and U.S. Dollar based
capitalization between our parent company and our foreign subsidiaries. The current year activity
reflects the changes in the U.S. Dollar compared to the functional currencies of our major
operating subsidiaries, particularly in the U.K. and Norway.
To date, general inflationary trends have not had a material effect on our operating revenues
or expenses.
22
Off-Balance Sheet Arrangements
We have evaluated our off-balance sheet arrangements, and have concluded that we do not have
any material relationships with unconsolidated entities or financial partnerships that have been
established for the purpose of facilitating off-balance sheet arrangements (as that term is defined
in Item 303(a)(4)(ii) of Regulation S-K). Based on this evaluation, we believe that no disclosures
relating to off-balance sheet arrangements are required.
Forward-Looking Statements
This Form 10-Q contains certain forward-looking statements and other statements that are not
historical facts concerning, among other things, market conditions, the demand for marine and
transportation support services and future capital expenditures. These statements are subject to
certain risks, uncertainties and assumptions, including, without limitation:
|
|
|
operational risk, |
|
|
|
|
catastrophic or adverse sea or weather conditions, |
|
|
|
|
dependence on the oil and natural gas industry, |
|
|
|
|
volatility in oil and natural gas prices, |
|
|
|
|
delay or cost overruns on construction projects or insolvency of the shipbuilders, |
|
|
|
|
lack of shipyard or equipment availability, |
|
|
|
|
ongoing capital expenditure requirements, |
|
|
|
|
uncertainties surrounding environmental and government regulation, |
|
|
|
|
uncertainties surrounding deep water permitting and exploration and development
activities, |
|
|
|
|
risks relating to compliance with the Jones Act, |
|
|
|
|
risks relating to leverage, |
|
|
|
|
risks of foreign operations, |
|
|
|
|
risk of war, sabotage, piracy or terrorism, |
|
|
|
|
assumptions concerning competition, |
|
|
|
|
risks of currency fluctuations, and |
|
|
|
|
other matters. |
These statements are based on certain assumptions and analyses made by us in light of our
experience and perception of historical trends, current conditions, expected future developments
and other factors we believe are appropriate under the circumstances. Such statements are subject
to risks and uncertainties, including the risk factors discussed above and those discussed in our
Form 10-K for the year ended December 31, 2010, filed with the SEC, general economic and business
conditions, the business opportunities that may be presented to and pursued by us, changes in law
or regulations and other factors, many of which are beyond our control.
We cannot assure you that we have accurately identified and properly weighed all of the
factors which affect market conditions and demand for our vessels, that the information upon which
we have relied is accurate or complete, that our analysis of the market and demand for our vessels
is correct, or that the strategy based on that analysis will be successful.
23
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Sensitivity
Our financial instruments that are potentially sensitive to changes in interest rates include
our 7.75% Senior Notes. As of June 30, 2011, the fair value of these notes, based on quoted market
prices, was approximately $162.7 million compared to a carrying amount of $159.8 million.
Exchange Rate Sensitivity
We operate in a number of international areas and are involved in transactions denominated in
currencies other than U.S. Dollars, which exposes us to foreign currency exchange risk. At various
times we may utilize forward exchange contracts, local currency borrowings and the payment
structure of customer contracts to selectively hedge exposure to exchange rate fluctuations in
connection with monetary assets, liabilities and cash flows denominated in certain foreign
currency. We do not hold or issue forward exchange contracts or other derivative financial
instruments for speculative purposes.
Other information required under Item 3 has been incorporated into Managements Discussion and
Analysis of Financial Condition and Results of Operations and is incorporated herein.
ITEM 4. CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures.
Based on their evaluation of our disclosure controls and procedures as of the end of the
period covered by this report, our Chief Executive Officer and Chief Financial Officer have
concluded that the disclosure controls and procedures are effective for the period covered by the
report ensuring that the information required to be disclosed by us in the reports that we file or
submit under the Securities Exchange Act is recorded, processed, summarized and reported within the
time periods specified in the SECs rules and forms.
(b) Evaluation of internal controls and procedures.
As of December 31, 2010, our management determined that our internal controls over financial
reporting were effective. Our assessment of the effectiveness of our internal controls over
financial reporting as of December 31, 2010, has been audited by UHY LLP, an independent public
accounting firm, as stated in our Form 10-K for the year ended December 31, 2010 filed with the
SEC.
There were no changes in our internal controls over financial reporting that occurred during
the period covered by this report that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
24
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS
Exhibits
See Exhibit Index for list of Exhibits filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
|
|
|
GulfMark Offshore, Inc.
(Registrant)
|
|
|
By: |
/s/ Quintin V. Kneen
|
|
|
|
Quintin V. Kneen |
|
|
|
Executive Vice President and Chief Financial Officer |
|
|
Date: July 22, 2011
25
INDEX TO EXHIBITS
|
|
|
|
|
|
|
|
|
Filed Herewith or |
|
|
|
|
Incorporated by Reference |
|
|
|
|
from the |
Exhibits |
|
Description |
|
Following Documents |
|
|
|
|
|
3.1
|
|
Certificate of Incorporation, as amended
|
|
Exhibit 3.1 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
3.2
|
|
Bylaws, as amended
|
|
Exhibit 3.2 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
4.1
|
|
Description of GulfMark Offshore, Inc.
Common Stock
|
|
Exhibit 4.1 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
4.2
|
|
Form of U.S. Citizen Stock Certificates
|
|
Exhibit 4.2 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
4.3
|
|
Form of Non-U.S. Citizen Stock Certificates
|
|
Exhibit 4.3 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
4.4
|
|
Indenture, dated as of July 21, 2004,
between GulfMark Offshore, Inc., as the
Company, and U.S. Bank National
Association, as Trustee, including a form
of the Companys 7.75% Senior Notes due
2014
|
|
Exhibit 4.4 to our
quarterly report on Form
10-Q for the quarter
ended September 30, 2004 |
|
|
|
|
|
4.5
|
|
First Supplemental Indenture, dated as of
February 24, 2010, between GulfMark
Offshore, Inc. (f/k/a New GulfMark
Offshore, Inc.), as the Company and U.S.
Bank Association, as Trustee, for the
Companys 7.75% Senior Notes due 2014
|
|
Exhibit 10.1 to our
current report on Form
8-K filed on February
24, 2010 |
|
|
|
|
|
4.6
|
|
Form of Debt Securities Indenture
(Including Form of Note for Debt
Securities)
|
|
Exhibit 4.7 to our
Post-Effective Amendment
No. 2/A to our
Registration Statement
on Form S-3 filed on May
14, 2010. |
|
|
|
|
|
4.7
|
|
See Exhibit No. 3.1 for provisions of the
Certificate of Incorporation and Exhibit
3.2 for provisions of the Bylaws defining
the rights of the holders of Common Stock
|
|
Exhibits 3.1 and 3.2 to
our current report on
Form 8-K filed on
February 24, 2010 |
|
|
|
|
|
31.1
|
|
Section 302 Certification for B.A. Streeter
|
|
Filed herewith |
|
|
|
|
|
31.2
|
|
Section 302 Certification for Q.V. Kneen
|
|
Filed herewith |
|
|
|
|
|
32.1
|
|
Section 906 Certification furnished for
B.A. Streeter
|
|
Filed herewith |
|
|
|
|
|
32.2
|
|
Section 906 Certification furnished for
Q.V. Kneen
|
|
Filed herewith |
26
|
|
|
|
|
|
|
|
|
Filed Herewith or |
|
|
|
|
Incorporated by Reference |
|
|
|
|
from the |
Exhibits |
|
Description |
|
Following Documents |
101
|
|
The following materials from GulfMark
Offshore, Inc.s Quarterly Report on Form
10-Q for the quarter ended June 30, 2011,
formatted in XBRL (Extensible Business
Reporting Language): (i) Unaudited
Condensed Consolidated Balance Sheets,
(ii) Unaudited Condensed Consolidated
Statements of Operations, (iii) Unaudited
Condensed Consolidated Statements of
Stockholders Equity, (iv) Unaudited
Condensed Consolidated Statements of Cash
Flows and (v) Notes to Unaudited
Consolidated Condensed Financial
Statements, tagged as blocks of text.
|
|
Filed herewith |
27