Key Energy Provides Operations and Restatement Update
Monday June 19, 8:10 pm ET
HOUSTON, June 19 /PRNewswire-FirstCall/ -- Key Energy Services, Inc. (OTC Bulletin Board: KEGS - News) today provided an operational and financial update, including its May 2006 rig and trucking hours, and unaudited selected financial data for the month ended April 30, 2006. The Company also provided an update on the status of its restatement process.
OPERATIONS UPDATE
Activity levels remain strong as weekly rig hours, excluding the Memorial Day holiday weekend, continue to average over 53,000 hours. Earlier this month, Key placed in service its first wireline unit in its new Texas-based electric wireline operation. The Company has ordered 10 units and anticipates delivery of at least one unit per month until the order is complete.
Commenting on operating activity, Dick Alario, Chairman and CEO, stated, "Our customers continue to request upgraded equipment and highly-trained, efficient crews. To meet these needs, we elected to proceed with our second half pricing initiative which was announced last month. These increases will be phased in during the third quarter and will allow us to continue to invest in our fleet and our people, and to deliver better returns to our shareholders."
OPERATING DATA
For the month ending
May 31, 2006 April 30, 2006 May 31, 2005
Working Days 22 19 21
Rig Hours 234,752 211,394 218,774
Trucking Hours 213,786 185,123 214,373
The Company calculates working days as total weekdays for the month
less any company holidays that occur that month. For the month of
June 2006, there are 22 working days.
RESTATEMENT UPDATE
The Company continues to target a filing of the 2003 Form 10-K by the end of June. However, the timing of the filing depends on the time required to complete the audit of the financial statements.
SELECTED FINANCIAL DATA
The following selected financial information for the Company is for the month ended April 30, 2006. This unaudited information has been prepared by management in accordance with generally accepted accounting principles and has not been reviewed or audited by the Company's independent accountants. The table does not contain all the financial statement line captions and notes that would be presented in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2006 or Annual Report on Form 10-K for the year ended December 31, 2006.
Month Ended
April 30, 2006
Select Statement of Operations Data: (In thousands - Unaudited)
Revenue:
Well servicing $90,678
Pressure pumping 17,059
Fishing and rental services 7,439
TOTAL REVENUE $115,176
Costs and Expenses:
Well servicing $56,983
Pressure pumping 9,582
Fishing and rental services 4,562
General and administrative 13,753
Interest (A) 3,582
April 30, 2006
Select Balance Sheet Data: (In thousands - Unaudited)
Current Assets:
Cash and cash equivalents (B), © $123,481
Accounts receivable, net of allowance
for doubtful accounts 219,650
Inventory 16,958
Prepaid expenses and other current assets 28,417
TOTAL CURRENT ASSETS $388,506
Current Liabilities:
Accounts payable $71,166
Other accrued liabilities 89,324
Accrued interest 5,847
Current portion of long-term debt and
capital lease obligations 12,748
TOTAL CURRENT LIABILITIES $179,085
Long-term debt, less current portion (D) $395,000
Capital lease obligations, less
current portion 17,006
Non-current accrued expenses 33,994
NOTES
(A) Interest expense includes amortization of deferred debt issue costs,
discount and premium of approximately $169,000 for the month ended
April 30, 2006.
(B) Cash and short term investments at June 15, 2006 totaled
approximately $108 million. The cash balance reflects a $24 million
income tax payment made on June 15, 2006.
© Capital expenditures were approximately $19 million for the month
ended April 30, 2006.
(D) There were no outstanding borrowings under the Company's revolving
credit facility at June 15, 2006.
The information herein represents the results for only one month and the information herein is not necessarily indicative of the results that may be reported for the fiscal year ended December 31, 2006. The information herein is select financial data and does not represent a complete set of financial statements, which would include additional financial data and notes to financial statements. Until the restatement of the Company's prior year financial statements is completed, the unaudited information herein may differ from its restated financial statements. It is possible that the process of restating the prior year financial statements could require additional changes to the Company's financial statements for 2006 that individually or in the aggregate could be material to the Company's financial position, results of operations or liquidity.
Key Energy Services, Inc. is the world's largest rig-based well service company. The Company provides oilfield services including well servicing, contract drilling, pressure pumping, fishing and rental tools and other oilfield services. The Company has operations in all major onshore oil and gas producing regions of the continental United States and internationally in Argentina.
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