Oceaneering Sees Profit Drop
Subsea engineering specialist, Oceaneering, has reported net income of $27.5 million, or $0.28 per share, on revenue of $722 million for the three months ended December 31, 2015.
Adjusted net income was $57.4 million, or $0.58 per share, excluding the $45.9 million pre-tax impact of asset write-downs, provisions for certain reserves, restructuring expenses and foreign currency losses recognized during the quarter.
Compared with the fourth quarter of 2014, Oceaneering’s net income declined some 73 per cent from $102 million, or $0.99 per share. Revenue decreased approximately 21 per cent from $919 million in the corresponding period in 2014.
Furthermore, for the year 2015, Oceaneering reported net income of $231 million, or $2.34 per share, on revenue of $3.1 billion. This compared to 2014 net income of $428 million (46% decline), or $4.00 per share, on revenue of $3.7 billion.
M. Kevin McEvoy, Oceaneering’s CEO, said: “The severe deterioration in oil prices and the resulting slowdown in deepwater activity since last year impacted our fourth quarter and full year results. We have undertaken a series of initiatives to align our operations with current and anticipated declining activity and pricing levels. Unfortunately, these restructuring steps required us to reduce our workforce, incur unusual expenses, and make certain accounting adjustments.
Oceaneering declared a regular quarterly dividend of $0.27 per common share. The dividend is payable March 18, 2016 to shareholders of record at the close of business on February 26, 2016.
“We may, however, revisit our quarterly dividend should market conditions deteriorate to the extent that our projected annual net income would not exceed the current annual dividend,” says McEvoy.
“For 2016, we are expecting lower demand for our services and products, and continued pricing pressure and spending cuts from our customers. Consequently, we are projecting that all of our oilfield business segments will have lower operating income in 2016 than in 2015. With our limited market visibility on how weak 2016 may actually be, we are not prepared to quantify the magnitude or duration of the decline or give annual and quarterly EPS guidance ranges,” the company said in Q4 2015 earnings report.