Newpark Resources Inc (NR)

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Newpark Resources Reports 2008 Fourth Quarter and Full Year Results





THE WOODLANDS, Texas, Feb. 19 /PRNewswire-FirstCall/ -- Newpark Resources, Inc. (NYSE:NR) today announced results for its fourth quarter and year ended December 31, 2008. Total revenues were $226.9 million for the fourth quarter of 2008 compared to $173.0 million for the fourth quarter of 2007. The Company reported income from continuing operations of $7.2 million, or $0.08 per diluted share for the fourth quarter of 2008, compared to $6.8 million, or $0.07 per diluted share, in the fourth quarter of 2007. Net income was $6.7 million, or $0.08 per diluted share for the quarter, compared to $6.7 million, or $0.07 per diluted share, in the fourth quarter of 2007. Operating results in the fourth quarter of 2008 included $4.6 million in pre-tax charges ($3.0 million after-tax) related to the termination of the sale of the U.S. Environmental Services business and the anticipated resolution of a lawsuit with the Company's former Chief Executive Officer. Operating results in the fourth quarter of 2007 included a $4.0 million pre-tax charge ($2.9 million after-tax) related to the repayment and termination of the Company's previous credit facilities. As set forth in the attached Non-GAAP Earnings Reconciliation, excluding these charges from both the fourth quarter 2008 and 2007 periods, fourth quarter 2008 income from continuing operations was $10.2 million, or $0.12 per diluted share, compared to fourth quarter 2007 income from continuing operations of $9.7 million, or $0.11 per diluted share.

For the full year 2008, total revenues were $858.4 million, compared to $671.2 million in 2007. Net income was $38.5 million, or $0.43 per diluted share in 2008 compared to $26.7 million, or $0.29 per diluted share in 2007. Operating results in 2008 included $8.1 million in pre-tax charges, as described above, compared to $6.4 million in certain pre-tax charges in 2007. As set forth in the attached Non-GAAP Earnings Reconciliation, excluding these charges in both 2008 and 2007, income from continuing operations was $44.7 million, or $0.50 per diluted share in 2008, compared to income from continuing operations of $36.1 million, or $0.40 per diluted share in 2007.

As previously reported, Newpark had entered into an agreement in April 2008 to sell its U.S. Environmental Services business to CCS, Inc. ("CCS"). In October 2008, the Federal Trade Commission ("FTC") filed suit seeking a Temporary Restraining Order and Preliminary Injunction to prevent the completion of the sale to CCS. In November 2008, we reached a mutual agreement with CCS to terminate the sale agreement. Following the termination of this agreement, the U.S. Environmental Services business, which had been reported within discontinued operations, is now reported in continuing operations as a third reportable segment of the Company. Prior period results included in this release reflect the reclassification of the U.S. Environmental Services business as continuing operations.

Paul Howes, President and Chief Executive Officer of Newpark, stated, "Fourth quarter revenue results in our core drilling fluids and engineering segment were strong, up 40% year over year. While domestic drilling activity slowed towards the end of the quarter, our international opportunities have been steadily growing. Highlights in our international fluids segment during the quarter include our signing a major contract with Petroleo Brasileiro S.A. to provide drilling fluids and related services for both onshore and offshore locations beginning in 2009. Additionally, we have recently won contract awards from other major operators in that market.

"While the decline in E&P spending is expected to negatively impact our operating results in 2009, as compared to the results achieved during 2008, we began taking actions during the fourth quarter to reduce headcount and operating costs, in an effort to meet the lower activity levels," concluded Howes.