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SEACOR Holdings Announces Results for Its Third Quarter and Nine Months Ended September 30, 2016

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FORT LAUDERDALE, FL -- (Marketwired) -- 10/27/16 -- SEACOR Holdings Inc. (NYSE: CKH) (the "Company") today announced its results for its third quarter and nine months ended September 30, 2016.

For the quarter ended September 30, 2016, net loss attributable to SEACOR Holdings Inc. was $39.8 million ($2.35 per diluted share). In reflecting on this quarter's results and the outlook for its businesses, Charles Fabrikant, Executive Chairman and Chief Executive Officer commented:

"At the outset, I want to state that it is not our intent to include lengthy quotes in quarterly press releases on a regular basis. In most quarters, our discussion of each segment's results in our press release and Form 10-Q should suffice to update investors. However, given our very poor results and the need once again to recognize impairments to the carrying value of our assets, it seemed that elaboration on operations and outlook for our businesses might be helpful to investors.

Unfortunately, the offshore segment fulfilled the prophecy in my annual letter dated April 15, 2016: "Dismal." There has been little improvement in offshore activity, notwithstanding oil prices having recovered -- for the moment -- to the $50 level. That recovery, not surprisingly, has drawn activity into the shale provinces but not stimulated drilling offshore. Indeed, customers are still conserving capital, deferring maintenance as well as seeking contractual "outs" for rig commitments. Based on our best attempts to gather anecdotal information, it appears that activity in the fourth quarter of 2016 will not pick up. It is likely that additional drilling rigs will be released, or simply held idle, even when oil companies are contractually obligated to keep paying for them. Our response has been to continue to reduce expenses.

Most industry observers expect the first half of 2017 to be brutal. The winter months, even in good times, are usually less active for us due to weather in the North Sea, Russia and the Gulf of Mexico. This December through March is likely to be "the winter of discontent."

Contrary to many industry commentators, I now anticipate that there will be a slight uptick in activity in the second half of 2017 if oil prices remain in a range of $40-50 per barrel based on Brent pricing. As the cost of engaging a rig provides little or no return to the capital asset, the variable expense for development drilling is now largely based on the price of local labor. Wages in some regions have come down substantially in U.S. dollar terms. Wages in dollar terms in Brazil, Mexico and the UK are now cheaper than they have been in quite some time. If the British pound remains at current levels, working in the North Sea should be less than it was in the first half of 2016.

As also noted in my April letter, the number of active vessels in a region should come into balance with base load demand as more vessels are "stacked." Incremental jobs should allow for some modest improvement in rates and utilization for those vessels actively marketed. This appeared to occur in the North Sea during the summer months. Not surprisingly, with winter coming, rates and utilization have declined reflecting the seasonal downturn.

Since my last report in April, we have seen some stability or increase in activity in the Mediterranean, Arabian Gulf and India. There are also some political developments that auger well for the future. The Brazilian legislature has enacted law allowing international oil companies to hold acreage and operate, similar to the law enacted by Mexico in 2015. Although the prevailing view among industry colleagues is that we should not expect a significant increase in activity before 2020, I would be surprised if Brazil did not come to life in the second half of 2018 assuming rates for rigs remain depressed, the Brazilian real remains around 3 to 1 U.S. dollar, and oil prices hover around $50 per barrel. I realize this is an outlying opinion.

I am less optimistic about the possibility for a positive surprise in the second half 2017 in the U.S. Gulf of Mexico. Unfortunately, the U.S. Gulf of Mexico has a huge surplus of vessels, especially those capable of serving deepwater, and is a region that can most easily handle repairs and re-certifying vessels.

We have used the occasion of severe distress to acquire assets at prices which we believe over time will prove very favorable. During the third quarter, we purchased eleven fast support vessels for $10.0 million in a foreclosure proceeding. I expect there will be more transactions such as this, although perhaps not at prices reflective of such a deep discount to replacement cost of the equipment.

Eventually, lenders will lose patience and seek to preserve value in their loans by forcing consolidation. Operating offshore vessels is relatively overhead intensive in relationship to the underlying value of capital assets, and that ratio of overhead and operating support costs to vessel values is even higher today in light of the depressed value of assets. At the moment, there are few cash buyers for boats. There are also few willing sellers so actual transactions are relatively few, except when a lender decides to foreclose. Restructuring is currently the "name of the game."

SEACOR is committed to wait patiently for opportunities to acquire more assets or collaborate with others interested in reducing costs and rationalizing fleets in conjunction with restructuring. Our strong balance sheet and differentiated fleet separate us from others who are struggling with debt and dependent on an upturn in deepwater drilling to provide employment for their assets.

Of course, the very circumstances that enable us to acquire offshore equipment at distressed prices make assessing the value for our own assets very challenging. I stress now as I did in April that we do our best to comply with the rigors of GAAP. However, making educated guesses about the "recoverability" of the carrying value of our assets from projected future income and cash flows is not a "science." When there is sufficient uncertainty about "recoverability," we mark down our assets to "fair value." That too is elusive. It is difficult to find data points for clearing prices when there are few buyers and almost all sellers are being forced. We have mostly delegated the determination of our fair values to brokers or appraisers. They may have the hardest job of all and they, too, have to deal with a moving target.

Turning to our inland river results, sadly, my April forecast of "rainy weather" for the dry-cargo business has also proved correct. Despite a large grain export program, rates and margins during peak fall harvest season never attained sustained high levels. Perfect operating conditions on the river system facilitated handling the large volume. As I pointed out, the large number of barges which had been engaged in moving coal and "frack" sand moved into the covered trades competing for grain cargoes. Inland River Services' third quarter results reflected these pressures. I do not see the supply and demand for covered barges coming into better balance for a couple of years. The likely driver will be some pickup in movements of coal and "frack" sand and retirement of older barges. Our policy is to depreciate our hopper barges over 20 years, although they are capable of working 25-30 years with increased maintenance. Market conditions, the price of scrap steel and interest rates are the important variables in determining whether or not older barges remain in service. I estimate that almost 2,000 covered barges will have attained their 20th anniversary in 2017. If market conditions remain drab and scrap prices remain close to current levels, some of this equipment should bleed out of the system, although the dynamic can also be influenced by operator bias to run barges for the sake of keeping towboats busy.

Given the uncertainty and conflicting opinions about the time frame for recovery in offshore activity, we will do our best to update shareholders if our perception changes."

For the preceding quarter ended June 30, 2016, net loss attributable to SEACOR Holdings Inc. was $55.2 million ($3.26 per diluted share). A comparison of results for the quarter ended September 30, 2016 with the preceding quarter ended June 30, 2016 is included in the "Highlights for the Quarter" discussion below. For the quarter ended September 30, 2015, net income attributable to SEACOR Holdings Inc. was $7.0 million ($0.40 per diluted share).

For the nine months ended September 30, 2016 and 2015, net loss attributable to SEACOR Holdings Inc. was $122.1 million ($7.23 per diluted share) and $11.9 million ($0.68 per diluted share), respectively. Results attributable to SEACOR Holdings Inc. for the nine months ended September 30, 2016 included:

  • low utilization of equipment as a consequence of continuing difficult market conditions for Offshore Marine Services and, to a lesser extent, Inland River Services;
  • a net loss of $34.4 million ($2.04 per diluted share) as a result of a decline in the fair market value of the Company's marketable security position in Dorian LPG Ltd. ("Dorian");
  • a net loss of $32.9 million ($1.95 per diluted share) as a result of Offshore Marine Services' impairment charges primarily associated with its liftboat fleet, its anchor handling towing supply fleet and one specialty vessel;
  • a net loss of $4.2 million ($0.25 per diluted share) as a result of Shipping Services' impairment charges related to a cost method investment in a foreign container shipping company;
  • a net loss of $4.2 million ($0.25 per diluted share) to reserve for one of the Company's notes receivable from a third party following a decline in the underlying collateral value; and
  • a net loss of $3.6 million ($0.22 per diluted share) related to Offshore Marine Services' proportionate share of impairment charges associated with its joint ventured fleet.

Highlights for the Quarter

Offshore Marine Services - Operating loss was $41.1 million compared with $34.5 million in the preceding quarter. As a consequence of continuing difficult market conditions, the Company recognized impairment charges of $29.2 million in the third quarter primarily associated with its anchor handling towing supply fleet and one specialty vessel and $20.9 million in the preceding quarter primarily associated with its liftboat fleet. Operating income before depreciation and amortization ("OIBDA" - see disclosure related to Non-GAAP measures in the segment information tables herein), excluding impairment charges, was $2.4 million on operating revenues of $54.1 million compared with $1.7 million on operating revenues of $57.3 million in the preceding quarter.

Excluding wind farm utility vessels but including cold-stacked vessels (those that are not currently available for active service), utilization of the fleet decreased from 50% to 47% and average rates per day worked decreased by 3% from $10,354 to $10,089. Days available for charter were 2% higher in the third quarter primarily due to the acquisition of eleven vessels during the third quarter. This release includes a table presenting time charter operating data by vessel class.

Operating results in the U.S. Gulf of Mexico, excluding losses on dispositions and impairments, were $0.8 million lower compared with the preceding quarter. Time charter revenues for the U.S. anchor handling towing supply vessels were $3.4 million lower due to weaker market conditions and $1.1 million higher for other vessel classes. On a total fleet basis, including cold-stacked vessels, utilization declined from 17% to 14% and average rates per day worked decreased from $17,109 to $13,810. As of September 30, 2016, the Company had 37 of 45 owned and leased-in vessels cold-stacked in the U.S. Gulf of Mexico compared with 25 of 33 as of June 30, 2016. As of September 30, 2016, the cold-stacked vessels consisted of ten anchor handling towing supply vessels,13 fast support vessels, two supply vessels and twelve liftboats.

Operating results from international regions, excluding losses on asset dispositions and impairments, were $3.1 million higher compared with the preceding quarter primarily due to the incremental contribution of a term charter which commenced in Russia in June 2016. On a total fleet basis, excluding wind farm utility vessels but including cold-stacked vessels, utilization declined from 68% to 67%, and average rates per day worked increased from $9,413 to $9,606. As of September 30, 2016, the Company had six of 96 owned and leased-in vessels cold-stacked in international regions compared with four of 100 as of June 30, 2016. As of September 30, 2016, the cold-stacked vessels consisted of one anchor handling towing supply vessel, three fast support vessels, one mini-supply vessel and one supply vessel.

Foreign currency losses of $1.1 million in the third quarter and $0.8 million in the preceding quarter were primarily due to the weakening of the pound sterling in relation to the euro underlying certain of the Company's debt balances.

Equity in losses of 50% or less owned companies of $3.3 million in the preceding quarter were primarily due to losses of $3.0 million for the Company's proportionate share of impairment charges associated with its joint ventured fleet.

Inland River Services - Operating loss was $1.3 million compared with $1.1 million in the preceding quarter. OIBDA was $5.0 million on operating revenues of $41.1 million compared with $5.2 million on operating revenues of $33.8 million in the preceding quarter.

Operating results, excluding gains (losses) on asset dispositions and impairments, were $3.0 million higher compared with the preceding quarter primarily due to higher activity levels in the dry-cargo barge pools associated with the commencement of the fall harvest and favorable operating conditions, although an oversupply of equipment continues to place downward pressure on freight rates.

Foreign currency gains of $0.4 million in the third quarter and $1.0 million in the preceding quarter were primarily due to the strengthening of the Colombian peso in relation to the U.S. dollar underlying certain of the Company's intercompany lease obligations.

Shipping Services - Operating income was $13.9 million compared with $10.6 million in the preceding quarter. OIBDA was $22.1 million (of which $8.0 million was attributable to noncontrolling interests) on operating revenues of $57.4 million compared with $18.0 million (of which $5.9 million was attributable to noncontrolling interests) on operating revenues of $55.6 million in the preceding quarter.

Operating results were $3.3 million higher in the third quarter compared with the preceding quarter primarily due to a full quarter of operations from one newly built U.S.-flag product tanker placed into service during May 2016.

Other, net of $5.5 million in the third quarter and $0.9 million in the preceding quarter was primarily due to impairment charges related to a cost method investment in a foreign container shipping company.

Illinois Corn Processing - Segment profit was $2.0 million (of which $0.6 million was attributable to noncontrolling interests) on operating revenues of $44.0 million compared with $3.3 million (of which $1.0 million was attributable to noncontrolling interests) on operating revenues of $40.6 million in the preceding quarter. Segment profit was $1.3 million lower primarily due to a decline in industry-wide fuel ethanol margins.

Other - During the preceding quarter, segment loss includes a $6.7 million reserve for one of the Company's notes receivable from a third party following a decline in the underlying collateral value.

Debt Extinguishment Gains - During the third quarter, the Company purchased $41.4 million in principal amount of its 2.5% Convertible Senior Notes for $41.0 million resulting in gains on debt extinguishment of $0.6 million.

Marketable Security Transactions - Unrealized marketable security losses on the Company's investment in 9,177,135 shares of Dorian, a publicly traded company listed on the New York Stock Exchange under the symbol "LPG," were $21.8 million in the first quarter, $21.6 million in the second quarter and $9.6 million in the third quarter. Dorian's closing share price was $11.77, $9.40, $7.05, $6.00 and $6.29 as of December 31, 2015, March 31, 2016, June 30, 2016, September 30, 2016 and October 27, 2016, respectively. The Company's cost basis in Dorian is $13.66 per share.

Capital Commitments - The Company's capital commitments as of September 30, 2016 by year of expected payment were as follows (in thousands):

2016 2017 2018 2019 Total
Offshore Marine Services $ 12,622 $ 38,366 $ 47,374 $ 12,554 $ 110,916
Shipping Services 43,482 26,096 -- -- 69,578
Inland River Services 17,572 27,465 -- -- 45,037
Illinois Corn Processing 1,287 -- -- -- 1,287
$ 74,963 $ 91,927 $ 47,374 $ 12,554 $ 226,818

Offshore Marine Services' capital commitments included nine fast support vessels, four supply vessels and one wind farm utility vessel. These commitments included $15.4 million for one supply vessel that may be assumed by a third party at their option. Shipping Services' capital commitments included two U.S.-flag product tankers, one U.S.-flag chemical and petroleum articulated tug-barge, two U.S.-flag harbor tugs and other equipment and upgrades. Inland River Services' capital commitments included 38 dry-cargo barges, three inland river towboats and other equipment and improvements. Subsequent to September 30, 2016, the Company committed to purchase other equipment for $18.0 million.

Liquidity and Debt - As of September 30, 2016, the Company's balances of cash, cash equivalents, restricted cash, marketable securities and construction reserve funds totaled $715.1 million and its total outstanding debt was $1,041.9 million. In addition, the Company had $51.3 million of borrowing capacity under its subsidiary credit facilities. Subsequent to September 30, 2016, the Company's subsidiaries borrowed $5.0 million under these credit facilities to fund their capital commitments.

SEACOR and its subsidiaries are in the business of owning, operating, investing in and marketing equipment, primarily in the offshore oil and gas, shipping and logistics industries. SEACOR offers customers a diversified suite of services and equipment, including offshore marine, inland river storage and handling, distribution of petroleum, chemical and agricultural commodities, and shipping. SEACOR is dedicated to building innovative, modern, "next generation," efficient marine equipment while providing highly responsive service with the highest safety standards and dedicated professional employees. SEACOR is publicly traded on the New York Stock Exchange (NYSE) under the symbol CKH.

Certain statements discussed in this release as well as in other reports, materials and oral statements that the Company releases from time to time to the public constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, words such as "anticipate," "estimate," "expect," "project," "intend," "believe," "plan," "target," "forecast" and similar expressions are intended to identify forward-looking statements. Such forward-looking statements concern management's expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters. These statements are not guarantees of future performance and actual events or results may differ significantly from these statements. Actual events or results are subject to significant known and unknown risks, uncertainties and other important factors, including decreased demand and loss of revenues as a result of a decline in the price of oil and resulting decrease in capital spending by oil and gas companies, as an oversupply of newly built offshore support vessels, additional safety and certification requirements for drilling activities in the U.S. Gulf of Mexico and delayed approval of applications for such activities, the possibility of U.S. government implemented moratoriums directing operators to cease certain drilling activities in the U.S. Gulf of Mexico and any extension of such moratoriums, weakening demand for the Company's services as a result of unplanned customer suspensions, cancellations, rate reductions or non-renewals of vessel charters or failures to finalize commitments to charter vessels in response to a decline in the price of oil, an oversupply of newly built offshore support vessels, increased government legislation and regulation of the Company's businesses could increase cost of operations, increased competition if the Jones Act is repealed, liability, legal fees and costs in connection with the provision of emergency response services, including the Company's involvement in response to the oil spill as a result of the sinking of the Deepwater Horizon in April 2010, decreased demand for the Company's services as a result of declines in the global economy, declines in valuations in the global financial markets and a lack of liquidity in the credit sectors, including, interest rate fluctuations, availability of credit, inflation rates, change in laws, trade barriers, commodity prices and currency exchange fluctuations, the cyclical nature of the oil and gas industry, activity in foreign countries and changes in foreign political, military and economic conditions, including as a result of the recent vote in the U.K. to leave the European Union, changes in foreign and domestic oil and gas exploration and production activity, safety record requirements related to Offshore Marine Services and Shipping Services, decreased demand for Shipping Services due to construction of additional refined petroleum product, natural gas or crude oil pipelines or due to decreased demand for refined petroleum products, crude oil or chemical products or a change in existing methods of delivery, compliance with U.S. and foreign government laws and regulations, including environmental laws and regulations and economic sanctions, the dependence of Offshore Marine Services, Inland River Services, Shipping Services and Illinois Corn Processing on several customers, consolidation of the Company's customer base, the ongoing need to replace aging vessels, industry fleet capacity, restrictions imposed by the Shipping Acts on the amount of foreign ownership of the Company's Common Stock, operational risks of Offshore Marine Services, Inland River Services and Shipping Services, effects of adverse weather conditions and seasonality, the level of grain export volume, the effect of fuel prices on barge towing costs, variability in freight rates for inland river barges, the effect of international economic and political factors on Inland River Services' operations, the effect of the spread between the input costs of corn and natural gas compared with the price of alcohol and distillers grains on Illinois Corn Processing's operations, adequacy of insurance coverage, the potential for a material weakness in the Company's internal controls over financial reporting and the Company's ability to remediate such potential material weakness, the attraction and retention of qualified personnel by the Company, and various other matters and factors, many of which are beyond the Company's control as well as those discussed in Item 1A (Risk Factors) of the Company's Annual report on Form 10-K and other reports filed by the Company with the SEC. It should be understood that it is not possible to predict or identify all such factors. Consequently, the preceding should not be considered to be a complete discussion of all potential risks or uncertainties. Forward-looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in the Company's expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its filings with the Securities and Exchange Commission, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (if any). These statements constitute the Company's cautionary statements under the Private Securities Litigation Reform Act of 1995.

SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands, except share data, unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2016 2015 2016 2015
Operating Revenues $ 206,983 $ 261,852 $ 617,949 $ 804,105
Costs and Expenses:
Operating 146,796 175,985 448,146 582,876
Administrative and general 32,245 37,892 102,124 115,453
Depreciation and amortization 31,132 31,018 93,482 94,527
210,173 244,895 643,752 792,856
Gains (Losses) on Asset Dispositions and Impairments, Net (29,826 ) 11,264 (47,380 ) 10,804
Operating Income (Loss) (33,016 ) 28,221 (73,183 ) 22,053
Other Income (Expense):
Interest income 5,277 5,065 15,890 14,118
Interest expense (12,504 ) (10,894 ) (37,273 ) (31,797 )
Debt extinguishment gains (losses), net 557 (434 ) 5,395 (29,970 )
Marketable security losses, net (7,865 ) (4,604 ) (56,912 ) (3,476 )
Derivative losses, net (1,174 ) (725 ) (109 ) (2,295 )
Foreign currency losses, net (666 ) (4,057 ) (651 ) (3,614 )
Other, net (5,460 ) 1,773 (12,844 ) 6,162
(21,835 ) (13,876 ) (86,504 ) (50,872 )
Income (Loss) Before Income Tax Expense (Benefit) and Equity in Earnings (Losses) of 50% or Less Owned Companies (54,851 ) 14,345 (159,687 ) (28,819 )
Income Tax Expense (Benefit) (21,147 ) 3,063 (61,737 ) (8,736 )
Income (Loss) Before Equity in Earnings (Losses) of 50% or Less Owned Companies (33,704 ) 11,282 (97,950 ) (20,083 )
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax (322 ) 5,123 (7,533 ) 10,086
Net Income (Loss) (34,026 ) 16,405 (105,483 ) (9,997 )
Net Income attributable to Noncontrolling Interests in Subsidiaries 5,777 9,440 16,665 1,920
Net Income (Loss) attributable to SEACOR Holdings Inc. $ (39,803 ) $ 6,965 $ (122,148 ) $ (11,917 )
Basic Earnings (Loss) Per Common Share of SEACOR Holdings Inc. $ (2.35 ) $ 0.40 $ (7.23 ) $ (0.68 )
Diluted Earnings (Loss) Per Common Share of SEACOR Holdings Inc. $ (2.35 ) $ 0.40 $ (7.23 ) $ (0.68 )
Weighted Average Common Shares Outstanding:
Basic 16,943,647 17,294,927 16,896,751 17,616,035
Diluted 16,943,647 17,561,107 16,896,751 17,616,035
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands, except per share data, unaudited)
Three Months Ended
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Operating Revenues $ 206,983 $ 197,038 $ 213,928 $ 250,631 $ 261,852
Costs and Expenses:
Operating 146,796 143,882 157,468 165,729 175,985
Administrative and general 32,245 34,175 35,704 41,158 37,892
Depreciation and amortization 31,132 31,361 30,989 31,460 31,018
210,173 209,418 224,161 238,347 244,895
Gains (Losses) on Asset Dispositions and Impairments, Net (29,826 ) (17,771 ) 217 (13,212 ) 11,264
Operating Income (Loss) (33,016 ) (30,151 ) (10,016 ) (928 ) 28,221
Other Income (Expense):
Interest income 5,277 5,020 5,593 5,902 5,065
Interest expense (12,504 ) (12,834 ) (11,935 ) (11,500 ) (10,894 )
Debt extinguishment gains (losses), net 557 1,615 3,223 1,473 (434 )
Marketable security gains (losses), net (7,865 ) (23,951 ) (25,096 ) 3,402 (4,604 )
Derivative gains (losses), net (1,174 ) (1,555 ) 2,620 199 (725 )
Foreign currency gains (losses), net (666 ) (22 ) 37 (1,138 ) (4,057 )
Other, net (5,460 ) (7,652 ) 268 611 1,773
(21,835 ) (39,379 ) (25,290 ) (1,051 ) (13,876 )
Income (Loss) Before Income Tax Expense (Benefit) and Equity in Earnings (Losses) of 50% or Less Owned Companies (54,851 ) (69,530 ) (35,306 ) (1,979 ) 14,345
Income Tax Expense (Benefit) (21,147 ) (25,759 ) (14,831 ) (2,626 ) 3,063
Income (Loss) Before Equity in Earnings (Losses) of 50% or Less Owned Companies (33,704 ) (43,771 ) (20,475 ) 647 11,282
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax (322 ) (7,162 ) (49 ) (50,500 ) 5,123
Net Income (Loss) (34,026 ) (50,933 ) (20,524 ) (49,853 ) 16,405
Net Income attributable to Noncontrolling Interests in Subsidiaries 5,777 4,226 6,662 7,012 9,440
Net Income (Loss) attributable to SEACOR Holdings Inc. $ (39,803 ) $ (55,159 ) $ (27,186 ) $ (56,865 ) $ 6,965
Basic Earnings (Loss) Per Common Share of SEACOR Holdings Inc. $ (2.35 ) $ (3.26 ) $ (1.62 ) $ (3.36 ) $ 0.40
Diluted Earnings (Loss) Per Common Share of SEACOR Holdings Inc. $ (2.35 ) $ (3.26 ) $ (1.62 ) $ (3.36 ) $ 0.40
Weighted Average Common Shares of Outstanding:
Basic 16,944 16,929 16,817 16,942 17,295
Diluted 16,944 16,929 16,817 16,942 17,561
Common Shares Outstanding at Period End 17,336 17,321 17,295 17,155 17,354
SEACOR HOLDINGS INC.
SEGMENT INFORMATION
(in thousands, unaudited)
Three Months Ended
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Offshore Marine Services
Operating Revenues $ 54,125 $ 57,271 $ 59,879 $ 83,166 $ 95,531
Costs and Expenses:
Operating 41,159 44,245 48,850 59,223 70,221
Administrative and general 10,588 11,929 12,398 14,118 12,753
Depreciation and amortization 14,213 15,254 14,838 15,419 15,252
65,960 71,428 76,086 88,760 98,226
Losses on Asset Dispositions and Impairments, Net (29,233 ) (20,357 ) (380 ) (13,577 ) (246 )
Operating Loss (41,068 ) (34,514 ) (16,587 ) (19,171 ) (2,941 )
Other Income (Expense):
Derivative gains (losses), net 16 163 2,898 (2,751 ) (10 )
Foreign currency losses, net (1,084 ) (819 ) (1,560 ) (350 ) (1,567 )
Other, net 1 -- 265 373 (9 )
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax 790 (3,315 ) 2,161 1,248 1,708
Segment Loss(1) $ (41,345 ) $ (38,485 ) $ (12,823 ) $ (20,651 ) $ (2,819 )
OIBDA(2) $ (26,855 ) $ (19,260 ) $ (1,749 ) $ (3,752 ) $ 12,311
Drydocking expenditures (included in operating costs and expenses) $ 2,024 $ 1,964 $ 3,703 $ 3,485 $ 1,483
Out-of-service days for drydockings 62 191 131 246 87
Inland River Services
Operating Revenues $ 41,094 $ 33,814 $ 39,614 $ 58,415 $ 54,310
Costs and Expenses:
Operating 31,496 27,446 30,118 38,459 39,487
Administrative and general 3,982 3,777 3,912 4,011 3,907
Depreciation and amortization 6,308 6,254 7,137 7,113 7,268
41,786 37,477 41,167 49,583 50,662
Gains (Losses) on Asset Dispositions and Impairments, Net (597 ) 2,580 605 389 11,510
Operating Income (Loss) (1,289 ) (1,083 ) (948 ) 9,221 15,158
Other Income (Expense):
Derivative gains (losses), net -- -- -- (15 ) 50
Foreign currency gains (losses), net 410 1,018 1,437 (640 ) (2,173 )
Other, net (1 ) (4 ) -- -- --
Equity in Losses of 50% or Less Owned Companies, Net of Tax (171 ) (1,677 ) (2,778 ) (25,092 ) (2,117 )
Segment Profit (Loss)(1) $ (1,051 ) $ (1,746 ) $ (2,289 ) $ (16,526 ) $ 10,918
OIBDA(2) $ 5,019 $ 5,171 $ 6,189 $ 16,334 $ 22,426
SEACOR HOLDINGS INC.
SEGMENT INFORMATION (continued)
(in thousands, unaudited)
Three Months Ended
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Shipping Services
Operating Revenues $ 57,350 $ 55,620 $ 57,055 $ 61,388 $ 58,673
Costs and Expenses:
Operating 28,542 30,269 27,234 28,118 27,666
Administrative and general 6,675 7,337 6,918 7,014 6,236
Depreciation and amortization 8,216 7,415 6,562 6,474 6,476
43,433 45,021 40,714 41,606 40,378
Gains (Losses) on Asset Dispositions 3 6 (6 ) -- --
Operating Income 13,920 10,605 16,335 19,782 18,295
Other Income (Expense):
Foreign currency losses, net (3 ) (6 ) (3 ) (18 ) (9 )
Other, net (5,534 ) (928 ) 1 1 1,836
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax (551 ) (1,591 ) 26 (27,578 ) 5,292
Segment Profit (Loss)(1) $ 7,832 $ 8,080 $ 16,359 $ (7,813 ) $ 25,414
OIBDA(2) $ 22,136 $ 18,020 $ 22,897 $ 26,256 $ 24,771
Drydocking expenditures for U.S.-flag product tankers (included in operating costs and expenses) $ 95 $ 62 $ (73 ) $ 207 $ 66
Out-of-service days for drydockings of U.S.-flag product tankers -- -- -- -- --
Illinois Corn Processing
Operating Revenues $ 44,019 $ 40,576 $ 49,609 $ 38,654 $ 40,282
Costs and Expenses:
Operating 39,879 36,153 46,289 36,747 33,514
Administrative and general 750 912 656 693 543
Depreciation and amortization 1,055 1,064 1,053 964 979
41,684 38,129 47,998 38,404 35,036
Operating Income 2,335 2,447 1,611 250 5,246
Other Income (Expense):
Derivative gains (losses), net (328 ) 856 (187 ) (137 ) (336 )
Segment Profit(1) $ 2,007 $ 3,303 $ 1,424 $ 113 $ 4,910
SEACOR HOLDINGS INC.
SEGMENT INFORMATION (continued)
(in thousands, unaudited)
Three Months Ended
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Other
Operating Revenues $ 11,146 $ 10,261 $ 8,419 $ 9,922 $ 13,779
Costs and Expenses:
Operating 6,618 6,427 5,805 4,166 5,854
Administrative and general 3,833 3,649 4,223 6,231 6,658
Depreciation and amortization 432 448 455 575 152
10,883 10,524 10,483 10,972 12,664
Gains (Losses) on Asset Dispositions 1 -- (2 ) (24 ) --
Operating Income (Loss) 264 (263 ) (2,066 ) (1,074 ) 1,115
Other Income (Expense):
Foreign currency gains (losses), net (25 ) (73 ) (27 ) 21 (64 )
Other, net -- (6,723 ) -- 5 (1 )
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax (390 ) (579 ) 542 922 240
Segment Profit (Loss)(1) $ (151 ) $ (7,638 ) $ (1,551 ) $ (126 ) $ 1,290
Corporate and Eliminations
Operating Revenues $ (751 ) $ (504 ) $ (648 ) $ (914 ) $ (723 )
Costs and Expenses:
Operating (898 ) (658 ) (828 ) (984 ) (757 )
Administrative and general 6,417 6,571 7,597 9,091 7,795
Depreciation and amortization 908 926 944 915 891
6,427 6,839 7,713 9,022 7,929
Operating Loss $ (7,178 ) $ (7,343 ) $ (8,361 ) $ (9,936 ) $ (8,652 )
Other Income (Expense):
Derivative gains (losses), net $ (862 ) $ (2,574 ) $ (91 ) $ 3,102 $ (429 )
Foreign currency gains (losses), net 36 (142 ) 190 (151 ) (244 )
Other, net 74 3 2 232 (53 )
(1) Includes amounts attributable to both SEACOR and noncontrolling interests.
(2) Non-GAAP Financial Measure. The Company, from time to time, discloses and discusses OIBDA, a non-GAAP financial measure, for certain of its operating segments in its public releases and other filings with the Securities and Exchange Commission. The Company defines OIBDA as operating income (loss) for the applicable segment plus depreciation and amortization. The Company's measure of OIBDA may not be comparable to similarly titled measures presented by other companies. Other companies may calculate OIBDA differently than the Company, which may limit its usefulness as a comparative measure. In addition, this measurement does not necessarily represent funds available for discretionary use and is not a measure of the Company's ability to fund its cash needs. OIBDA is a financial metric used by management (i) as a supplemental internal measure for planning and forecasting overall expectations and for evaluating actual results against such expectations; (ii) as a criteria for annual incentive bonuses paid to the Company officers and other shore-based employees; and (iii) to compare to the OIBDA of other companies when evaluating potential acquisitions.
SEACOR HOLDINGS INC.
OFFSHORE MARINE SERVICES
TIME CHARTER OPERATING DATA
(unaudited)
Three Months Ended
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Rates Per Day Worked:
Anchor handling towing supply $ 16,469 $ 20,828 $ 21,719 $ 30,871 $ 29,978
Fast support 7,848 7,636 7,587 8,014 8,853
Mini-supply 5,858 5,592 5,689 5,345 5,858
Standby safety 8,904 9,632 9,564 10,229 10,487
Supply 7,599 7,151 9,010 14,375 14,459
Towing supply 3,750 4,171 7,200 8,872 7,912
Specialty 30,593 18,642 12,403 23,107 25,517
Liftboats 16,822 11,852 15,150 25,191 17,124
Overall Average Rates Per Day Worked (excluding wind farm utility) 10,089 10,354 10,545 13,495 14,029
Wind farm utility 2,260 2,394 2,419 2,506 2,446
Overall Average Rates Per Day Worked 6,834 7,352 7,915 10,299 10,003
Utilization:
Anchor handling towing supply 27 % 33 % 47 % 51 % 59 %
Fast support 62 % 69 % 68 % 58 % 64 %
Mini-supply 56 % 70 % 79 % 97 % 97 %
Standby safety 78 % 77 % 79 % 85 % 84 %
Supply 15 % 6 % 11 % 43 % 41 %
Towing supply 35 % 9 % 45 % 97 % 68 %
Specialty 58 % 81 % 45 % 80 % 88 %
Liftboats 8 % 6 % 5 % 13 % 31 %
Overall Fleet Utilization (excluding wind farm utility) 47 % 50 % 52 % 59 % 63 %
Wind farm utility 86 % 77 % 65 % 65 % 90 %
Overall Fleet Utilization 58 % 57 % 56 % 60 % 70 %
Available Days:
Anchor handling towing supply 1,483 1,365 1,365 1,380 1,380
Fast support 2,389 2,174 2,093 2,173 2,072
Mini-supply 331 364 364 368 368
Standby safety 1,989 2,104 2,184 2,208 2,208
Supply 594 594 633 736 920
Towing supply 184 182 182 184 184
Specialty 276 273 273 276 276
Liftboats 1,380 1,365 1,365 1,380 1,380
Overall Fleet Available Days (excluding wind farm utility) 8,626 8,421 8,459 8,705 8,788
Wind farm utility 3,345 3,276 3,245 3,222 3,262
Overall Fleet Available Days 11,971 11,697 11,704 11,927 12,050
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, unaudited)
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
ASSETS
Current Assets:
Cash and cash equivalents $ 471,180 $ 552,840 $ 496,473 $ 530,009 $ 456,805
Restricted cash 3,364 1,742 -- -- --
Marketable securities 78,717 87,701 110,894 138,200 31,632
Receivables:
Trade, net of allowance for doubtful accounts 148,358 125,987 130,731 159,076 175,968
Other 32,452 34,319 31,440 27,217 39,696
Inventories 16,047 16,798 18,431 24,768 23,274
Prepaid expenses and other 9,500 10,157 9,615 8,627 10,755
Total current assets 759,618 829,544 797,584 887,897 738,130
Property and Equipment:
Historical cost 2,128,010 2,158,826 2,015,205 2,123,201 2,099,483
Accumulated depreciation (1,008,629 ) (997,214 ) (986,048 ) (994,181 ) (967,721 )
1,119,381 1,161,612 1,029,157 1,129,020 1,131,762
Construction in progress 464,660 402,090 484,472 454,605 413,572
Held for sale equipment -- -- 86,332 -- --
Net property and equipment 1,584,041 1,563,702 1,599,961 1,583,625 1,545,334
Investments, at Equity, and Advances to 50% or Less Owned Companies 331,063 325,386 334,370 331,103 490,818
Construction Reserve Funds 161,865 166,888 255,350 255,408 253,470
Goodwill 52,403 52,394 52,376 52,340 65,725
Intangible Assets, Net 23,496 24,116 25,750 26,392 27,179
Other Assets 41,647 39,287 46,496 48,654 46,371
$ 2,954,133 $ 3,001,317 $ 3,111,887 $ 3,185,419 $ 3,167,027
LIABILITIES AND EQUITY
Current Liabilities:
Current portion of long-term debt $ 28,228 $ 24,409 $ 35,688 $ 35,531 $ 35,452
Accounts payable and accrued expenses 70,032 55,971 50,660 71,952 64,997
Other current liabilities 96,324 98,706 107,811 92,677 113,271
Total current liabilities 194,584 179,086 194,159 200,160 213,720
Long-Term Debt 1,013,691 1,014,632 1,018,331 1,034,859 914,220
Exchange Option Liability on Subsidiary Convertible Senior Notes 8,938 8,171 5,747 5,611 --
Deferred Income Taxes 307,353 330,375 374,476 389,988 418,776
Deferred Gains and Other Liabilities 148,085 155,859 153,051 163,862 170,850
Total liabilities 1,672,651 1,688,123 1,745,764 1,794,480 1,717,566
Equity:
SEACOR Holdings Inc. stockholders' equity:
Preferred stock -- -- -- -- --
Common stock 379 379 379 377 377
Additional paid-in capital 1,512,209 1,510,623 1,508,981 1,505,942 1,503,794
Retained earnings 1,004,472 1,044,275 1,099,434 1,126,620 1,183,485
Shares held in treasury, at cost (1,357,331 ) (1,357,876 ) (1,357,809 ) (1,356,499 ) (1,346,371 )
Accumulated other comprehensive loss, net of tax (10,471 ) (10,810 ) (7,764 ) (5,620 ) (5,604 )
1,149,258 1,186,591 1,243,221 1,270,820 1,335,681
Noncontrolling interests in subsidiaries 132,224 126,603 122,902 120,119 113,780
Total equity 1,281,482 1,313,194 1,366,123 1,390,939 1,449,461
$ 2,954,133 $ 3,001,317 $ 3,111,887 $ 3,185,419 $ 3,167,027
SEACOR HOLDINGS INC.
FLEET COUNTS
(unaudited)
Sep. 30, 2016 Jun. 30, 2016 Mar. 31, 2016 Dec. 31, 2015 Sep. 30, 2015
Offshore Marine Services
Anchor handling towing supply 27 27 18 18 18
Fast support 50 39 38 38 38
Mini-supply 5 6 7 7 7
Standby safety 21 23 25 25 25
Supply 23 24 23 24 26
Towing supply 3 3 3 3 3
Specialty 7 7 5 5 5
Liftboats 15 15 15 15 15
Wind farm utility 40 39 39 38 39
191 183 173 173 176
Inland River Services
Dry-cargo barges 1,405 1,393 1,426 1,430 1,431
Liquid tank barges:
10,000 barrel 18 18 18 18 18
30,000 barrel -- -- 27 27 27
Specialty barges(1) 11 11 11 11 11
Towboats:
4,000 hp - 6,600 hp 17 17 17 17 17
3,300 hp - 3,900 hp 1 1 -- -- --
Less than 3,200 hp 4 4 17 17 16
1,456 1,444 1,516 1,520 1,520
Shipping Services
Petroleum Transportation:
Product tankers - U.S.-flag 8 8 7 7 7
Crude oil tanker - U.S.-flag -- -- 1 1 1
Harbor Towing and Bunkering:
Harbor tugs - U.S.-flag 24 24 24 24 24
Harbor tugs - Foreign-flag 4 4 4 4 4
Offshore tug - U.S.-flag 1 1 1 1 1
Ocean liquid tank barges - U.S.-flag 5 5 5 5 5
Liner and Short-sea Transportation:
RORO/deck barges - U.S.-flag 7 7 7 7 7
Short-sea container/RORO - Foreign-flag 7 7 7 7 7
Other:
Dry bulk articulated tug-barge - U.S.-flag 1 1 1 1 1
57 57 57 57 57
(1) Includes non-certificated 10,000 and 30,000 barrel inland river liquid tank barges.
SEACOR HOLDINGS INC.
EXPECTED FLEET DELIVERIES
AS OF SEPTEMBER 30, 2016
(unaudited)
2016 2017 2018 2019
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Total
Offshore Marine Services
Fast support -- 3 2 -- -- -- 1 -- 1 -- 1 -- 1 9
Supply(1) -- 1 -- -- -- 1 -- 1 -- 1 -- -- -- 4
Wind farm utility -- -- 1 -- -- -- -- -- -- -- -- -- -- 1
Shipping Services
Product tankers - U.S.-flag 1 1 -- -- -- -- -- -- -- -- -- -- -- 2
Articulated tug-barge - U.S.-flag -- 1 -- -- -- -- -- -- -- -- -- -- -- 1
Harbor tugs - U.S.-flag 1 -- 1 -- -- -- -- -- -- -- -- -- -- 2
Inland River Services
Dry-cargo barges 38 -- -- -- -- -- -- -- -- -- -- -- -- 38
Towboats:
4,000 hp - 6,600 hp -- 1 -- 1 1 -- -- -- -- -- -- -- -- 3
(1) Includes one vessel that may be assumed by a third party at their option.

For additional information, contact
Molly Hottinger
(954) 627-5278
or visit SEACOR's website at www.seacorholdings.com

Source: SEACOR Holdings Inc.