tdw20200806_8k.htm
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): November 5, 2020

TIDEWATER INC.
(Exact name of Registrant as Specified in Its Charter)

Delaware
1-6311
72-0487776
(State or Other Jurisdiction
of Incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
 
6002 Rogerdale Road, Suite 600
Houston, Texas
 
77072
(Address of Principal Executive Offices)
 
(Zip Code)
 
Registrant’s Telephone Number, Including Area Code: (713) 470-5300
 
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
 
Trading
Symbol(s)
 
Name of each exchange on which registered
Common stock, $0.001 par value per share
 
TDW
 
New York Stock Exchange
Series A Warrants to purchase shares of common stock
 
TDW.WS.A
 
New York Stock Exchange
Series B Warrants to purchase shares of common stock
 
TDW.WS.B
 
New York Stock Exchange
Warrants to purchase shares of common stock
 
TDW.WS
 
NYSE American
Preferred stock purchase rights
 
N/A
 
New York Stock Exchange
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
 
Emerging growth company 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 
 

 
Item 2.02.  Results of Operations and Financial Condition.
 
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Tidewater Inc. (the “Company”) notes that certain statements set forth in this Current Report on Form 8-K provide contain certain forward-looking statements which reflect our current view with respect to future events and future financial performance. Forward-looking statements are all statements other than statements of historical fact. All such forward-looking statements are subject to risks and uncertainties, many of which are beyond the control of the Company, and our future results of operations could differ materially from our historical results or current expectations reflected by such forward-looking statements. These risks and uncertainties include, without limitation: the risks related to fluctuations in worldwide energy demand and oil and natural gas prices, and continuing depressed levels of oil and natural gas prices without a clear indication of if, or when, prices will recover to a level to support renewed offshore exploration activities; fleet additions by competitors and industry overcapacity; our limited capital resources available to replenish our asset base as needed, including through acquisitions or vessel construction, and to fund our capital expenditure needs; uncertainty of global financial market conditions and potential constraints in accessing capital or credit if and when needed with favorable terms, if at all; changes in decisions and capital spending by customers in the energy industry and the industry expectations for offshore exploration, field development and production; consolidation of our customer base; loss of a major customer; changing customer demands for vessel specifications, which may make some of our older vessels technologically obsolete for certain customer projects or in certain markets; rapid technological changes; delays and other problems associated with vessel maintenance; the continued availability of qualified personnel and our ability to attract and retain them; the operating risks normally incident to our lines of business, including the potential impact of liquidated counterparties; our ability to comply with covenants in our indentures and other debt instruments; acts of terrorism and piracy; the impact of regional or global public health crises or pandemics; the impact of potential information technology, cybersecurity or data security breaches; integration of acquired businesses and entry into new lines of business; disagreements with our joint venture partners; natural disasters or significant weather conditions; unsettled political conditions, war, civil unrest and governmental actions, such as expropriation or enforcement of customs or other laws that are not well developed or consistently enforced; the risks associated with our international operations, including local content, local currency or similar requirements especially in higher political risk countries where we operate; interest rate and foreign currency fluctuations; labor changes proposed by international conventions; increased regulatory burdens and oversight; changes in laws governing the taxation of foreign source income; retention of skilled workers; enforcement of laws related to the environment, labor and foreign corrupt practices; the potential liability for remedial actions or assessments under existing or future environmental regulations or litigation; the effects of asserted and unasserted claims and the extent of available insurance coverage; and the resolution of pending legal proceedings.
 
On November 5, 2020, the Company issued an earnings release announcing its financial results for the quarter ended September 30, 2020.  The press release is furnished as Exhibit 99.1 to this Current Report and is incorporated herein by reference as if fully set forth under this item.
 
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (“Exchange Act”) or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing made by us under the Exchange Act or Securities Act of 1933, as amended, regardless of any general incorporation language in any such filing, except as shall be expressly set forth by specific reference in such filing.
 
1

 
Item 9.01. Financial Statements and Exhibits.
 
(d)
Exhibits
 
The following exhibit is furnished with this Form 8-K:
 
Exhibit
Number
 
Description
99.1
 
 
 
 
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)
 
2

 
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.
 
 
 
TIDEWATER INC
 
 
 
 
Date: November 5, 2020
 
By:
/s/ Samuel R. Rubio
 
 
 
Samuel R. Rubio
 
 
 
Vice President, Chief Accounting Officer and Controller
 
 
3
ex_197787.htm

Exhibit 99.1

 

Press Release

   
TIDEWATER INC. ● 6002 Rogerdale Road, Suite 600 ● Houston, TX 77072 ● Telephone (713) 470-5300 ● Fax (888) 909-0946

  

 

Tidewater Reports Results for the Three and Nine Months Ended September 30, 2020

 

 

HOUSTON, November 5, 2020 — Tidewater Inc. (NYSE:TDW) announced today revenue for the three and nine months ended September 30, 2020, of $86.5 million and $305.2 million, respectively compared with $119.8 million and $367.8 million, respectively, for the three and nine months ended September 30, 2019. Tidewater also reported net losses for the three and nine months ended September 30, 2020, of $37.9 million ($0.94 per share) and $167.0 million ($4.15 per share), respectively, compared with $44.2 million ($1.15 per share) and $81.9 million ($2.17 per share), respectively, for the three and nine months ended September 30, 2019. Included in the net losses for the three and nine months ended September 30, 2020 were impairment charges related to assets held for sale, affiliate credit losses, affiliate guaranteed obligation, inventory obsolescence and general and administrative severance expenses totaling $2.6 million and $124.4 million, respectively. Excluding these costs, we would have reported a net loss for the three months ended September 30, 2020 of $35.3 million ($0.87 per common share) and a net loss for the nine months ended September 30, 2020 of $42.6 million ($1.06 per common share). Included in the net losses for the three and nine months ended September 30, 2019 were general and administrative expenses for severance and similar expenses related to integrating Tidewater and GulfMark operations of $6.3 million and $10.5 million, respectively. Excluding these costs, net losses for the three and nine months ended September 30, 2019 were $37.9 million (or $0.98 per common share) and $71.4 million (or $1.89 per common share), respectively.

 

Quintin Kneen, Tidewater’s President and Chief Executive Officer, commented, "Tidewater generated $30.0 million of free cash flow in the third-quarter, its best quarterly performance since its restructuring in 2017.  That cash was used to repurchase $27.7 million of our outstanding bonds at 95% of par, and we completed the quarter with $33.7 million of net debt. We recently launched a tender for another $50.0 million of the bonds at 100.5% of par, and we simultaneously launched a consent to relax the financial covenants in 2021.

 

“We are executing on the plan we laid out on the first quarter call after reassessing our business outlook as a result of the pandemic.  As of the third quarter we were positive cash flow from operations and free cash flow positive for the nine-month period.  We are dedicated to remaining free cash flow positive for the year, and we are repositioning our shore base operations and our fleet so our business can remain free cash flow positive under the currently depressed market conditions.

 

“Our quarterly cash generation performance is both important and noteworthy, but the operational impact of the pandemic and overall lower market demand have been both severe and challenging. The Tidewater team has dedicated to our objectives of capital expenditure management, working capital management, and the restructure of our business to accommodate the lower level of demand around the world for our vessels.

 

“Domestic and international travel restrictions have started to ease in some regions, and as a result we have been able to improve the frequency of crew changes and allow our mariners to return home safely to their families and to more easily return to work. The situation remains far from solved, however, and we continue to urge global government coordination to support open travel for seafarers as designated key workers. For 2020, we continue to see the additional costs associated with managing the travel inefficiencies to be approximately $20.0 million, and this is in addition to the decreased level of profitability from lower overall demand.

 

“Another key element to our strategy is high-grading our fleet through strategic acquisitions and disposals. We disposed of 22 vessels in the third quarter for $10.6 million and early in the fourth quarter we made an acquisition of 11 modern crew boats for $5.3 million.

 

“I continue to be humbled by the commitment and resilience of the dedicated women and men across the company during these arduous times. These individuals are who enabled the company to so readily adapt and to progress as much as it has towards achieving its goals in today’s challenging environment.”

 

 

 

 

In addition to the number of outstanding shares, as of September 30, 2020, the company also has the following in the money warrants.

 

Common shares outstanding

    40,460,982  

New Creditor Warrants (strike price $0.001 per common share)

    761,395  

GulfMark Creditor Warrants (strike price $0.01 per common share)

    930,027  

Total

    42,152,404  

 

Tidewater will hold a conference call to discuss results for the three and nine months ended September 30, 2020 on Friday, November 6, at 8:00 a.m. Central Time.  Investors and interested parties may listen to the earnings conference call via telephone by calling +1-888-771-4371 if calling from the U.S. or Canada (+1-847-585-4405 if calling from outside the U.S.) and asking for the “Tidewater” call just prior to the scheduled start time.  A live webcast of the call will also be available in the Investor Relations section of Tidewater’s website at investor.tdw.com

 

A replay of the conference call will be available beginning at 10:30 a.m. Central Time on November 6, 2020 and will continue until 11:59 p.m. Central Time on December 6, 2020. To access the replay, visit the Investor Relations section of Tidewater’s website at investor.tdw.com

 

The conference call will contain forward-looking statements in addition to statements of historical fact.  The actual achievement of any forecasted results or the unfolding of future economic or business developments in a way anticipated or projected by the company involves numerous risks and uncertainties that may cause the company’s actual performance to be materially different from that stated or implied in the forward-looking statements.  Such risks and uncertainties include, among other things, risks associated with the general nature of the oilfield service industry and other factors discussed within the “Risk Factors” section of Tidewater’s most recent Forms 10-Q and 10-K.

 

Tidewater owns and operates the largest fleet of Offshore Support Vessels in the industry, with over 60 years of experience supporting offshore energy exploration and production activities worldwide.

 

Note: all per-share amounts are stated on a diluted basis.

 

Financial information is displayed beginning on the next page.

 

2

 

TIDEWATER INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data) 

 

   

Three Months Ended

   

Nine Months Ended

 
   

September 30, 2020

   

September 30, 2019

   

September 30, 2020

   

September 30, 2019

 

Revenues:

                               

Vessel revenues

  $ 85,395     $ 117,173     $ 298,344     $ 360,476  

Other operating revenues

    1,072       2,592       6,835       7,296  

Total revenues

    86,467       119,765       305,179       367,772  

Costs and expenses:

                               

Vessel operating costs

    61,784       80,619       205,383       243,261  

Costs of other operating revenue

    219       534       3,063       1,884  

General and administrative

    17,438       30,474       56,455       81,310  

Depreciation and amortization

    30,777       25,735       86,028       73,705  

Long-lived asset impairments

    1,945       5,224       67,634       5,224  

Affiliate credit loss impairment expense

                53,581        

Affiliate guarantee obligation

                2,000        

(Gain) loss on asset dispositions, net

    (520 )     (270 )     (7,511 )     (1,047 )
      111,643       142,316       466,633       404,337  

Operating loss

    (25,176 )     (22,551 )     (161,454 )     (36,565 )

Other income (expense):

                               

Foreign exchange gain (loss)

    (1,153 )     173       (2,365 )     (324 )

Equity in net losses of unconsolidated companies

          (468 )           (435 )

Dividend income from unconsolidated company

                17,150        

Interest income and other, net

    272       1,579       1,084       5,908  

Interest and other debt costs, net

    (6,071 )     (7,468 )     (18,172 )     (22,786 )
      (6,952 )     (6,184 )     (2,303 )     (17,637 )

Loss before income taxes

    (32,128 )     (28,735 )     (163,757 )     (54,202 )

Income tax (benefit) expense

    5,953       15,071       3,512       26,443  

Net loss

  $ (38,081 )   $ (43,806 )   $ (167,269 )   $ (80,645 )

Net income (loss) attributable to noncontrolling interests

    (154 )     394       (274 )     1,245  

Net loss attributable to Tidewater Inc.

  $ (37,927 )   $ (44,200 )   $ (166,995 )   $ (81,890 )
Basic loss per common share   $ (0.94 )   $ (1.15 )   $ (4.15 )   $ (2.17 )
Diluted loss per common share   $ (0.94 )   $ (1.15 )   $ (4.15 )   $ (2.17 )

Weighted average common shares outstanding

    40,405       38,537       40,271       37,767  

Adjusted weighted average common shares

    40,405       38,537       40,271       37,767  

 

3

 

TIDEWATER INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and par value data)

 

   

September 30,

   

December 31,

 

ASSETS

 

2020

   

2019

 
                 

Current assets:

               

Cash and cash equivalents

  $ 192,243     $ 218,290  

Restricted cash

    26,401       5,755  

Trade and other receivables, less allowance for credit losses of $651 as of September 30, 2020 and less allowance for doubtful accounts of $70 as of December 31, 2019.

    100,583       110,180  

Due from affiliate, less allowance for credit losses of $72,696 as of September 30, 2020 and less due from affiliate allowance of $20,083 as of December 31, 2019

    65,692       125,972  

Marine operating supplies

    17,808       21,856  

Assets held for sale

    19,163       39,287  

Prepaid expenses and other current assets

    18,925       15,956  

Total current assets

    440,815       537,296  

Net properties and equipment

    820,876       938,961  

Deferred drydocking and survey costs

    63,975       66,936  

Other assets

    25,108       36,335  

Total assets

  $ 1,350,774     $ 1,579,528  
                 

LIABILITIES AND EQUITY

               

Current liabilities:

               

Accounts payable

  $ 12,953     $ 27,501  

Accrued costs and expenses

    55,811       74,000  

Due to affiliates

    53,355       50,186  

Current portion of long-term debt

    9,576       9,890  

Other current liabilities

    31,599       24,100  

Total current liabilities

    163,294       185,677  

Long-term debt

    246,179       279,044  

Other liabilities and deferred credits

    87,724       98,397  
                 
                 

Equity:

               

Common stock

    40       40  

Additional paid-in-capital

    1,370,778       1,367,521  

Accumulated deficit

    (519,684 )     (352,526 )

Accumulated other comprehensive income (loss)

    1,106       (236 )

Total stockholder's equity

    852,240       1,014,799  

Noncontrolling interests

    1,337       1,611  

Total equity

    853,577       1,016,410  

Total liabilities and equity

  $ 1,350,774     $ 1,579,528  

 

4

 

TIDEWATER INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

 

   

Three Months Ended

   

Nine Months Ended

 
   

September 30, 2020

   

September 30, 2019

   

September 30, 2020

   

September 30, 2019

 

Net loss

  $ (38,081 )   $ (43,806 )   $ (167,269 )   $ (80,645 )

Other comprehensive income:

                               

Change in pension plan and supplemental pension plan liability, net of tax of $0.2 million and $0.4 million, respectively

    525             1,342        

Total comprehensive loss

  $ (37,556 )   $ (43,806 )   $ (165,927 )   $ (80,645 )

 

5

 

TIDEWATER INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

 

   

Nine Months

   

Nine Months

 
   

Ended

   

Ended

 
   

September 30, 2020

   

September 30, 2019

 

Operating activities:

               

Net loss

  $ (167,269 )   $ (80,645 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

               

Depreciation

    53,614       57,629  

Amortization of deferred drydocking and survey costs

    32,414       16,076  

Amortization of debt premiums and discounts

    2,418       (1,562 )

Provision (benefit) for deferred income taxes

    107       759  

Gain on asset dispositions, net

    (7,511 )     (1,047 )

Affiliate credit loss impairment expense

    53,581        

Affiliate guarantee obligation

    2,000        

Long-lived asset impairments

    67,634       5,224  

Changes in investments in unconsolidated companies

          435  

Compensation expense - stock based

    3,959       16,599  

Changes in operating assets and liabilities, net:

               

Trade and other receivables

    9,434       (11,796 )

Changes in due to/from affiliate, net

    9,852       14,898  

Accounts payable

    (14,548 )     (8,267 )

Accrued costs and expenses

    (18,189 )     (10,574 )

Cash paid for deferred drydocking and survey costs

    (29,499 )     (43,701 )

Other, net

    3,809       9,268  

Net cash used in operating activities

    1,806       (36,704 )

Cash flows from investing activities:

               

Proceeds from sales of assets

    31,498       25,092  

Additions to property and equipment

    (4,682 )     (13,931 )

Net cash provided by investing activities

    26,816       11,161  

Cash flows from financing activities:

               

Principal payments on long-term debt

    (33,520 )     (6,458 )

Taxes on share-based awards

    (702 )     (3,112 )

Other

          1  

Net cash used in financing activities

    (34,222 )     (9,569 )

Net change in cash, cash equivalents and restricted cash

    (5,600 )     (35,112 )

Cash, cash equivalents and restricted cash at beginning of period

    227,608       397,744  

Cash, cash equivalents and restricted cash at end of period (A)

  $ 222,008     $ 362,632  

Supplemental disclosure of cash flow information:

               

Cash paid during the period for:

               

Interest, net of amounts capitalized

  $ 16,169     $ 24,482  

Income taxes

  $ 9,940     $ 10,386  

 

Note (A):  Cash, cash equivalents and restricted cash at September 30, 2020 includes $3.4 million in long-term restricted cash.

 

6

 

TIDEWATER INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In thousands)

 

   

Three Months Ended

 
                           

Accumulated

                 
           

Additional

           

other

   

Non

         
   

Common

   

paid-in

   

Accumulated

   

comprehensive

   

controlling

         
   

stock

   

capital

   

deficit

   

income (loss)

   

interest

   

Total

 

Balance at June 30,2020

  $ 40       1,369,645       (481,757 )     581       1,491       890,000  

Total comprehensive loss

                (37,927 )     525       (154 )     (37,556 )

Amortization, net of taxes, on share-based awards

          1,133                         1,133  

Balance at September 30, 2020

  $ 40       1,370,778       (519,684 )     1,106       1,337       853,577  
                                                 
                                                 

Balance at June 30, 2019

  $ 38       1,359,842       (248,473 )     2,194       1,938       1,115,539  

Total comprehensive loss

                (44,200 )           394       (43,806 )

Issuance of common stock from exercise of warrants

    1       (1 )                        

Amortization/cancellation of restricted stock units

          6,031                         6,031  

Balance at September 30, 2019

  $ 39       1,365,872       (292,673 )     2,194       2,332       1,077,764  

 

   

Nine Months Ended

 
                           

Accumulated

                 
           

Additional

           

other

   

Non

         
   

Common

   

paid-in

   

Accumulated

   

comprehensive

   

controlling

         
   

stock

   

capital

   

deficit

   

income (loss)

   

interest

   

Total

 

Balance at December 31, 2019

  $ 40       1,367,521       (352,526 )     (236 )     1,611       1,016,410  

Total comprehensive loss

                (166,995 )     1,342       (274 )     (165,927 )

Adoption of credit loss accounting standard

                (163 )                 (163 )

Amortization, net of taxes, on share-based awards

          3,257                         3,257  

Balance at September 30, 2020

  $ 40       1,370,778       (519,684 )     1,106       1,337       853,577  
                                                 
                                                 

Balance at December 31, 2018

  $ 37       1,352,388       (210,783 )     2,194       1,087       1,144,923  

Total comprehensive loss

                (81,890 )           1,245       (80,645 )

Issuance of common stock from exercise of warrants

    2                               2  

Amortization/cancellation of restricted stock units

          13,484                         13,484  

Balance at September 30, 2019

  $ 39       1,365,872       (292,673 )     2,194       2,332       1,077,764  

 

7

 

The company’s vessel revenues and vessel operating costs and the related percentage of total vessel revenues, were as follows:

 

   

Three Months Ended

   

Nine Months Ended

 
   

September 30, 2020

   

September 30, 2019

   

September 30, 2020

   

September 30, 2019

 

(In thousands)

          %             %             %             %  

Vessel revenues:

                                                               

Americas

  $ 28,705       34 %   $ 33,147       28 %   $ 94,608       32 %   $ 103,624       29 %

Middle East/Asia Pacific

    23,280       27 %     22,765       19 %     72,091       24 %     63,670       18 %

Europe/Mediterranean

    17,716       21 %     30,946       26 %     67,827       23 %     94,531       26 %

West Africa

    15,694       18 %     30,315       26 %     63,818       21 %     98,651       27 %

Total vessel revenues

  $ 85,395       100 %   $ 117,173       100 %   $ 298,344       100 %   $ 360,476       100 %

Vessel operating costs:

                                                               

Crew costs

  $ 36,686       43 %   $ 46,193       39 %   $ 119,864       40 %   $ 141,528       39 %

Repair and maintenance

    5,932       7 %     11,967       10 %     23,186       8 %     32,579       9 %

Insurance

    1,953       2 %     2,027       2 %     5,748       2 %     4,955       1 %

Fuel, lube and supplies

    6,757       8 %     8,781       7 %     22,892       8 %     26,577       7 %

Other

    10,456       12 %     11,651       10 %     33,693       11 %     37,622       10 %

Total vessel operating costs

    61,784       72 %     80,619       69 %     205,383       69 %     243,261       67 %

Vessel operating margin (A)

  $ 23,611       28 %   $ 36,554       31 %   $ 92,961       31 %   $ 117,215       33 %

 

Note (A): Vessel operating margin equals revenues less vessel operating costs and excludes general and administrative expenses and depreciation and amortization.

 

The company’s operating loss and other components of loss before income taxes and its related percentage of total revenues, were as follows:

 

   

Three Months Ended

   

Nine Months Ended

 
   

September 30, 2020

   

September 30, 2019

   

September 30, 2020

   

September 30, 2019

 

(In thousands)

          %           %           %           %

Vessel operating profit (loss):

                                                               

Americas

  $ 107       0 %   $ (168 )     (0 )%   $ 3,448       1 %   $ 1,702       0 %

Middle East/Asia Pacific

    (2,222 )     (3 )%     (809 )     (1 )%     (2,479 )     (1 )%     (4,098 )     (1 )%

Europe/Mediterranean

    (3,883 )     (4 )%     (276 )     (0 )%     (4,086 )     (1 )%     (768 )     (0 )%

West Africa

    (10,168 )     (12 )%     678       1 %     (19,015 )     (6 )%     11,891       3 %

Other operating profit

    853       1 %     2,052       2 %     3,772       1 %     5,381       1 %
      (15,313 )     (18 )%     1,477       1 %     (18,360 )     (6 )%     14,108       4 %
                                                                 

Corporate expenses (A)

    (8,438 )     (10 )%     (19,074 )     (16 )%     (27,390 )     (9 )%     (46,496 )     (13 )%

Gain (loss) on asset dispositions, net

    520       1 %     270       0 %     7,511       2 %     1,047       1 %

Affiliate credit loss impairment expense

          0 %           0 %     (53,581 )     (18 )%           0 %

Affiliate guarantee obligation

          0 %           0 %     (2,000 )     (1 )%           0 %

Long-lived asset impairments

    (1,945 )     (2 )%     (5,224 )     (4 )%     (67,634 )     (22 )%     (5,224 )     (1 )%

Operating loss

  $ (25,176 )     (29 )%   $ (22,551 )     (19 )%   $ (161,454 )     (53 )%   $ (36,565 )     (9 )%

 

Note (A):  General and administrative expenses for the three and nine months ended September 30, 2020 include stock-based compensation of $1.3 million and $4.0 million, respectively.  General and administrative expenses for the three and nine months ended September 30, 2019 includes stock-based compensation of $7.4 million and $16.6 million, respectively. In addition, general and administrative costs for the three months and nine ended September 30, 2020 include $0.6 million and $1.2 million, respectively, of severance and similar costs related to integrating Tidewater and GulfMark operations.  General and administrative expenses for the three and nine months ended September 30, 2019 include $6.3  million and $10.5 million, respectively, of severance and other costs related to integrating Tidewater and GulfMark operations.

 

8

 

TIDEWATER INC.

CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) – QUARTERLY DATA

(Unaudited)

(In thousands, except per share data) 

 

   

Three Months Ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 
   

2020

   

2020

   

2020

   

2019

   

2019

 

Revenues:

                                       

Vessel revenues

  $ 85,395     $ 100,975     $ 111,974     $ 116,539     $ 117,173  

Other operating revenues

    1,072       1,369       4,394       2,237       2,592  

Total revenues

    86,467       102,344       116,368       118,776       119,765  

Costs and expenses:

                                       

Vessel operating costs

    61,784       64,774       78,825       85,935       80,619  

Costs of other operating revenue

    219       171       2,673       916       534  

General and administrative (A)

    17,438       17,597       21,420       22,406       30,474  

Depreciation and amortization

    30,777       28,144       27,107       28,226       25,735  

(Gain) loss on asset dispositions, net

    1,945       (1,660 )     (5,331 )     (1,217 )     (270 )

Affiliate credit loss impairment expense

          53,581                    

Affiliate guarantee obligation

          2,000                    

Asset impairments and other

    (520 )     55,482       10,207       32,549       5,224  

Total operating costs and expenses

    111,643       220,089       134,901       168,815       142,316  

Operating loss

    (25,176 )     (117,745 )     (18,533 )     (50,039 )     (22,551 )

Other income (expense):

                                       

Foreign exchange gain (loss)

    (1,153 )     (2,076 )     864       (945 )     173  

Equity in net (losses) earnings of unconsolidated companies

                      (2,717 )     (468 )

Dividend income from unconsolidated company

          17,150                    

Interest income and other, net

    272       696       116       690       1,579  

Interest and other debt costs, net

    (6,071 )     (5,959 )     (6,142 )     (6,282 )     (7,468 )

Total other expense

    (6,952 )     9,811       (5,162 )     (9,254 )     (6,184 )

Loss before income taxes

    (32,128 )     (107,934 )     (23,695 )     (59,293 )     (28,735 )

Income tax (benefit) expense

    5,953       2,730       (5,171 )     1,281       15,071  

Net loss

  $ (38,081 )   $ (110,664 )   $ (18,524 )   $ (60,574 )   $ (43,806 )

Net income (loss) attributable to noncontrolling interests

    (154 )     (41 )     (79 )     (721 )     394  

Net loss attributable to Tidewater Inc.

  $ (37,927 )   $ (110,623 )   $ (18,445 )   $ (59,853 )   $ (44,200 )
Basic loss per common share   $ (0.94 )   $ (2.74 )   $ (0.46 )   $ (1.52 )   $ (1.15 )
Diluted loss per common share   $ (0.94 )   $ (2.74 )   $ (0.46 )   $ (1.52 )   $ (1.15 )

Weighted average common shares outstanding

    40,405       40,306       40,101       39,504       38,537  

Dilutive effect of stock options and restricted stock

                             

Adjusted weighted average common shares

    40,405       40,306       40,101       39,504       38,537  

Vessel operating margin

  $ 23,611     $ 36,201     $ 33,149     $ 30,604     $ 36,554  
                                         
                                         

Note (A) Integration related costs related to the business combination with GulfMark

    641       446       129       2,123       6,293  

 

9

 

TIDEWATER INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands) 

 

   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 

ASSETS

 

2020

   

2020

   

2020

   

2019

   

2019

 
                                         

Current assets:

                                       

Cash and cash equivalents

  $ 192,243       203,119       187,802       218,290       359,332  

Restricted cash

    26,401       19,880       12,461       5,755       3,300  

Trade and other receivables, net

    100,583       115,008       119,455       110,180       123,133  

Due from affiliate, less allowances

    65,692       65,766       128,204       125,972       124,757  

Marine operating supplies

    17,808       20,580       21,944       21,856       21,303  

Assets held for sale

    19,163       29,064       26,142       39,287        

Prepaid expenses and other current assets

    18,925       20,350       22,185       15,956       13,116  

Total current assets

    440,815       473,767       518,193       537,296       644,941  

Net properties and equipment

    820,876       839,912       922,979       938,961       1,022,786  

Deferred drydocking and survey costs

    63,975       74,585       81,981       66,936       49,025  

Other assets

    25,108       27,411       29,971       36,335       37,269  

Total assets

  $ 1,350,774       1,415,675       1,553,124       1,579,528       1,754,021  
                                         

LIABILITIES AND EQUITY

                                       

Current liabilities:

                                       

Accounts payable

  $ 12,953       17,111       30,711       27,501       23,672  

Accrued costs and expenses

    55,811       60,993       72,854       74,000       54,792  

Due to affiliates

    53,355       48,803       50,013       50,186       41,676  

Current portion of long-term debt

    9,576       9,437       9,104       9,890       9,689  

Other current liabilities

    31,599       25,815       26,953       24,100       30,024  

Total current liabilities

    163,294       162,159       189,635       185,677       159,853  

Long-term debt

    246,179       273,215       273,015       279,044       419,905  

Other liabilities and deferred credits

    87,724       90,301       91,578       98,397       96,499  
                                         
                                         

Equity:

                                       

Common stock

    40       40       40       40       39  

Additional paid-in-capital

    1,370,778       1,369,645       1,368,325       1,367,521       1,365,872  

Accumulated deficit

    (519,684 )     (481,757 )     (371,134 )     (352,526 )     (292,673 )

Accumulated other comprehensive income (loss)

    1,106       581       133       (236 )     2,194  

Total stockholder's equity

    852,240       888,509       997,364       1,014,799       1,075,432  

Noncontrolling interests

    1,337       1,491       1,532       1,611       2,332  

Total equity

    853,577       890,000       998,896       1,016,410       1,077,764  

Total liabilities and equity

  $ 1,350,774       1,415,675       1,553,124       1,579,528       1,754,021  
                                         

Supplemental information

                                       

Due from related parties, net of due to related parties:

                                       

Sonatide (Angola)

  $ 12,337       16,963       64,184       57,771       64,660  

DTDW (Nigeria)

                14,007       18,015       18,421  

Total

  $ 12,337       16,963       78,191       75,786       83,081  

 

10

 

TIDEWATER INC.

UNAUDITED OTHER FLEET AND FINANCIAL DATA

(In thousands)

 

   

Three Months Ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 
   

2020

   

2020

   

2020

   

2019

   

2019

 

VESSEL REVENUE BY VESSEL CLASS

                                       
                                         

Americas fleet:

                                       

Deepwater

  $ 22,836       27,858       22,882       22,883       24,575  

Towing-supply

    4,119       4,455       7,243       8,639       7,831  

Other

    1,750       1,731       1,734       1,811       741  

Total

    28,705       34,044       31,859       33,333       33,147  

Middle East/Asia Pacific fleet:

                                       

Deepwater

  $ 13,819       14,195       14,326       16,015       14,960  

Towing-supply

    9,461       9,788       10,502       10,636       7,805  

Total

    23,280       23,983       24,828       26,651       22,765  

Europe/Mediterranean fleet:

                                       

Deepwater

  $ 17,578       20,476       29,163       28,652       30,608  

Towing-supply

    (13 )           179       528       338  

Other

    151       144       149              

Total

    17,716       20,620       29,491       29,180       30,946  

West Africa fleet:

                                       

Deepwater

  $ 4,905       8,748       12,102       14,066       14,923  

Towing-supply

    7,711       11,029       10,521       9,981       11,598  

Other

    3,078       2,552       3,173       3,328       3,794  

Total

  $ 15,694       22,329       25,796       27,375       30,315  

Worldwide fleet:

                                       

Deepwater

  $ 59,137       71,277       78,473       81,616       85,066  

Towing-supply

    21,278       25,271       28,445       29,784       27,572  

Other

    4,980       4,427       5,056       5,139       4,535  

Total

    85,395       100,975       111,974       116,539       117,173  

 

11

 

TIDEWATER INC.

UNAUDITED OTHER FLEET AND FINANCIAL DATA

 

   

Three Months Ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 
   

2020

   

2020

   

2020

   

2019

   

2019

 

AVERAGE NUMBER OF VESSELS:

                                       
                                         

Americas fleet:

                                       

Deepwater

    32       32       32       31       32  

Towing-supply

    12       15       17       17       17  

Other

    3       3       3       4       5  

Total

    47       50       52       52       54  

Stacked vessels

    (17 )     (17 )     (17 )     (15 )     (17 )

Active vessels

    30       33       35       37       37  

Middle East/Asia Pacific fleet:

                                       

Deepwater

    22       26       27       27       26  

Towing-supply

    23       26       28       28       26  

Total

    45       52       55       55       52  

Stacked vessels

    (4 )     (9 )     (10 )     (10 )     (11 )

Active vessels

    41       43       45       44       41  

Europe/Mediterranean fleet:

                                       

Deepwater

    32       36       39       42       42  

Towing-supply

          1       2       3       3  

Total

    32       37       41       45       45  

Stacked vessels

    (17 )     (17 )     (11 )     (15 )     (13 )

Active vessels

    15       20       30       30       32  

West Africa fleet:

                                       

Deepwater

    25       26       26       27       29  

Towing-supply

    17       18       19       19       20  

Other

    16       19       20       21       21  

Total

    58       63       65       67       70  

Stacked vessels

    (31 )     (21 )     (21 )     (22 )     (22 )

Active vessels

    27       42       44       45       48  

Worldwide fleet:

                                       

Deepwater

    111      <