SEACOR Holdings Announces Results for the Third Quarter Ended September 30, 2019
October 28, 2019 - 7:18 PM EDT
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SEACOR Holdings Announces Results for the Third Quarter Ended September 30, 2019
FORT LAUDERDALE, Fla., Oct. 28, 2019 (GLOBE NEWSWIRE) -- SEACOR Holdings Inc. (NYSE:CKH) (the “Company”) today announced its results for the quarter ended September 30, 2019:
Net income attributable to stockholders was $6.4 million ($0.32 per diluted share) compared with $17.1 million ($0.88 per diluted share) for the quarter ended September 30, 2018. The prior year quarter included $5.5 million ($0.26 per diluted share) related to the amortization of previously deferred gains and net mark-to-market gains on marketable securities.
“Cash Earnings” were $27.7 million compared with $30.0 million for the same quarter last year. In the current quarter, "cash earnings" included $4.5 million for August and September's results from the acquisition of our partner's 49% ownership in SEA-Vista.
Operating income attributable to stockholders, was $12.9 million compared with $23.2 million for the quarter ended September 30, 2018. The prior year quarter benefited from the amortization of previously deferred gains of $5.3 million.
The Company uses the non-GAAP financial measures "Cash Earnings" and OIBDA in this release; a reconciliation to their closest U.S. GAAP measure is included in "Use of non-GAAP Financial Measures" in this release.
Charles Fabrikant, Executive Chairman, commented on the quarter's results as follows:
"The quarter’s disappointing results were primarily due to the extremely difficult conditions in the inland transportation and logistics services segment and a more typical level of demand for our emergency response services.
The third calendar quarter usually produces improved results in the inland sector compared with the second quarter, but this quarter the inland river system continued to suffer from the carryover effects of extreme flooding earlier in the year. Our inland group experienced curtailed demand for fleeting and terminal services, and the barge pool incurred higher costs. The U.S. trade dispute with China and competition from cheaper grain in South America were additional challenges. These challenges continue today. Corn export demand continues to be dismal with shipments approximately 60% and export sales approximately 45% below last year. Export sales are also lagging. Brazil, whose share of the soybean export market increased after the commencement of the trade dispute, continues to compete aggressively.
Witt-O’Brien’s higher activity level in the third quarter of last year reflected a multitude of early stage response and recovery task orders following the hurricanes of 2017. Witt O’Brien’s continues to support the long-term recovery efforts of public sector clients such as the U.S. Virgin Islands as well as expand into the private sector.
The overall operating results for the ocean sector in the current quarter were positive and in general compare favorably with the prior year, despite incurring a dry-docking this quarter and an accounting benefit in the prior year from the amortization of previously deferred gains. The operating discussion below provides more details."
Fabrikant continued, "The highlight of the quarter was the acquisition of our partner’s interest in Sea-Vista, strengthening our position in the Jones Act market and also adding substantial revenue backlog. As of September 30th, the contracted backlog in SEA-Vista was $237.7 million through 2026. (The acquisition also should reduce complexity in our financial statements, no doubt an added plus. We encourage you to review the tables provided in the release which include a reconciliation of cash earnings.)"
Operating Discussion
Ocean Transportation & Logistics Services - Operating income and OIBDA attributable to stockholders were $17.4 million and $26.5 million, in the current year quarter compared with $19.5 million and $27.6 million in the prior year quarter, respectively. Operating income and OIBDA attributable to stockholders in the prior year quarter benefited from the amortization of previously deferred gains of $4.5 million.
The operating results from harbor towing activities and SEACOR Island Lines improved meaningfully with a combined incremental contribution of $5.3 million and $5.1 million in operating income and OIBDA, respectively, as a consequence of increases in ship docking requirements in various ports and increased unit freight activity into the Bahamas. These increases were partially offset by lost revenue associated with 42 days of planned out-of-service time required for dry-docking one SEA-Vista vessel and the corresponding dry-docking expense. This quarter's results also reflected a reduction in the time charter rate for another SEA-Vista vessel in exchange for a multiyear extension of its charter. Operating results for the Company's military and commercial cargo activities, marketed under the Waterman brand, were also modestly lower in the current quarter.
Inland Transportation & Logistics Services - Operating income and OIBDA were $0.6 million and $6.2 million in the current year quarter compared with $4.3 million and $10.5 million in the prior year quarter, respectively. As previously detailed, the flooding throughout the inland waterways system and weak demand negatively impacted this year’s Inland’s results. Margins on freight operations suffered as weak freight rates were exacerbated by usually extended cycle times for trips and higher towing costs.
Witt O’Brien’s - Operating income and OIBDA were $2.1 million and $2.3 million in the current year quarter compared with $6.1 million and $6.6 million in the prior year quarter, respectively. As previously noted, the prior year had benefited from the initial activity surge that followed the late season hurricanes in 2017.
Capital Commitments - The Company’s capital commitments as of September 30, 2019 were $21.3 million and included the Company's interest in two foreign-flag rail ferries, two inland river towboats, other equipment and vessel and terminal improvements. Subsequent to September 30, 2019, the Company committed to purchase additional equipment for $0.3 million.
Liquidity and Debt - During the current year quarter, the Company repurchased $18.2 million in principal amount of its 3.0% Convertible Senior Notes for $18.1 million resulting in debt extinguishment losses of $0.8 million.
As of September 30, 2019, the Company’s balances of cash, cash equivalents, restricted cash, restricted cash equivalents, marketable securities and construction reserve funds totaled $88.0 million. As of September 30, 2019, the Company had exited its position in Dorian LPG Ltd. Total outstanding debt was $317.8 million, including $25.0 million of outstanding borrowings under the Company's revolving credit facilities, which has subsequently been repaid. As of September 30, 2019, the Company had $200.0 million of borrowing capacity under its credit facilities.
Equity - For the quarter ended September 30, 2019, basic and diluted weighted average shares outstanding were 19,322,423 and 20,738,919, respectively. As of September 30, 2019, the total shares outstanding were 20,179,218.
SEACOR Holdings Inc. (“SEACOR”) is a diversified holding company with interests in domestic and international transportation and logistics and risk management consultancy. 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. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by management of the Company. 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 risks relating to 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, increased government legislation and regulation of the Company’s businesses that could increase the 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, 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, activity in foreign countries and changes in foreign political, military and economic conditions, changes in foreign and domestic oil and gas exploration and production activity, safety record requirements related to Ocean Transportation & Logistics Services, decreased demand for Ocean Transportation & Logistics 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 Ocean Transportation & Logistics Services and Inland Transportation & Logistics Services on several key 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 Ocean Transportation & Logistics Services and Inland Transportation & Logistics 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 Transportation & Logistics Services’ operations, the ability to realize anticipated benefits from acquisitions and other strategic transactions, adequacy of insurance coverage, the attraction and retention of qualified personnel by the Company, changes in U.S. and international trade policies 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 Securities and Exchange Commission (“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. Given these factors, investors and analysts should not place undue reliance on forward-looking statements. 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 SEC, 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.
For additional information, contact Investor Relations at (954) 627-5278 or visit SEACOR’s website at www.seacorholdings.com.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except share data, unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2019
2018
2019
2018
Operating Revenues
$
200,658
$
220,257
$
607,205
$
621,912
Costs and Expenses:
Operating
147,386
147,529
437,368
441,474
Administrative and general
24,923
26,083
78,383
76,189
Depreciation and amortization
16,975
18,616
51,120
57,069
189,284
192,228
566,871
574,732
Gains on Asset Dispositions, Net
1,145
6,018
2,259
13,569
Operating Income
12,519
34,047
42,593
60,749
Other Income (Expense):
Interest income
2,198
2,450
5,983
6,485
Interest expense
(4,816
)
(8,335
)
(14,832
)
(25,502
)
Debt extinguishment losses, net
(777
)
(160
)
(2,073
)
(5,609
)
Marketable security gains (losses), net
144
1,713
16,496
(1,303
)
Foreign currency gains (losses), net
(1,877
)
(328
)
(1,663
)
16
Other, net
505
357
(114
)
54,951
(4,623
)
(4,303
)
3,797
29,038
Income Before Income Tax Expense and Equity in Earnings (Losses) of 50% or Less Owned Companies
7,896
29,744
46,390
89,787
Income Tax Expense
1,417
3,362
7,012
12,934
Income Before Equity in Earnings (Losses) of 50% or Less Owned Companies
6,479
26,382
39,378
76,853
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
(618
)
821
(3,448
)
1,915
Net Income
5,861
27,203
35,930
78,768
Net Income (Loss) Attributable to Noncontrolling Interests in Subsidiaries
(544
)
10,136
7,239
15,934
Net Income Attributable to SEACOR Holdings Inc.
$
6,405
$
17,067
$
28,691
$
62,834
Basic Earnings Per Common Share of SEACOR Holdings Inc.
$
0.33
$
0.94
$
1.54
$
3.48
Diluted Earnings Per Common Share of SEACOR Holdings Inc.
$
0.32
$
0.88
$
1.48
$
3.21
Weighted Average Common Shares Outstanding:
Basic
19,322,423
18,108,388
18,618,613
18,052,274
Diluted
20,738,919
21,192,554
19,984,302
22,508,622
OIBDA(1)
$
29,494
$
52,663
$
93,713
$
117,818
OIBDA Attributable to SEACOR Holdings Inc.(1)
$
28,813
$
38,630
$
77,714
$
96,120
______________________ 1. Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (in thousands, except per share data, unaudited)
Three Months Ended
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Operating Revenues
$
200,658
$
197,023
$
209,524
$
213,838
$
220,257
Costs and Expenses:
Operating
147,386
142,871
147,111
150,374
147,529
Administrative and general
24,923
26,714
26,746
26,718
26,083
Depreciation and amortization
16,975
17,009
17,136
17,510
18,616
189,284
186,594
190,993
194,602
192,228
Gains on Asset Dispositions, Net
1,145
677
437
6,014
6,018
Operating Income
12,519
11,106
18,968
25,250
34,047
Other Income (Expense):
Interest income
2,198
1,885
1,900
2,245
2,450
Interest expense
(4,816
)
(4,903
)
(5,113
)
(6,181
)
(8,335
)
Debt extinguishment losses, net
(777
)
(503
)
(793
)
(6,017
)
(160
)
Marketable security gains (losses), net
144
13,284
3,068
(11,128
)
1,713
Foreign currency gains (losses), net
(1,877
)
(191
)
405
(2,280
)
(328
)
Other, net
505
25
(644
)
13
357
(4,623
)
9,597
(1,177
)
(23,348
)
(4,303
)
Income Before Income Tax Expense (Benefit) and Equity in Earnings (Losses) of 50% or Less Owned Companies
7,896
20,703
17,791
1,902
29,744
Income Tax Expense (Benefit)
1,417
3,390
2,205
(4,519
)
3,362
Income Before Equity in Earnings (Losses) of 50% or Less Owned Companies
6,479
17,313
15,586
6,421
26,382
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
(618
)
(312
)
(2,518
)
(1,987
)
821
Net Income
5,861
17,001
13,068
4,434
27,203
Net Income (Loss) attributable to Noncontrolling Interests in Subsidiaries
(544
)
2,448
5,335
9,120
10,136
Net Income (Loss) attributable to SEACOR Holdings Inc.
$
6,405
$
14,553
$
7,733
$
(4,686
)
$
17,067
Basic Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
0.33
$
0.80
$
0.42
$
(0.26
)
$
0.94
Diluted Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
0.32
$
0.76
$
0.41
$
(0.26
)
$
0.88
Weighted Average Common Shares Outstanding:
Basic
19,322
18,289
18,233
18,165
18,108
Diluted
20,739
19,634
19,571
18,165
21,193
Common Shares Outstanding at Period End
20,179
18,550
18,528
18,330
18,243
OIBDA(1)
$
29,494
$
28,115
$
36,104
$
42,760
$
52,663
OIBDA attributable to SEACOR Holdings Inc.(1)
$
28,813
$
21,905
$
26,996
$
29,822
$
38,630
______________________ 1. Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC. SEGMENT INFORMATION (in thousands, unaudited)
Three Months Ended
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Ocean Transportation & Logistics Services
Operating Revenues
$
102,661
$
109,681
$
109,272
$
97,366
$
109,939
Costs and Expenses:
Operating
66,888
71,230
69,932
64,234
64,683
Administrative and general
9,404
9,423
10,198
10,132
9,170
Depreciation and amortization
10,191
10,230
10,337
10,707
11,298
86,483
90,883
90,467
85,073
85,151
Gains on Asset Dispositions, Net
804
349
17
5,496
5,505
Operating Income
16,982
19,147
18,822
17,789
30,293
Other Income (Expense):
Foreign currency gains (losses), net
(104
)
1
(47
)
(17
)
(24
)
Other, net
505
28
(651
)
(15
)
(96
)
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
(242
)
700
111
(23
)
2,073
Segment Profit(1)
$
17,141
$
19,876
$
18,235
$
17,734
$
32,246
OIBDA(2)
$
27,173
$
29,377
$
29,159
$
28,496
$
41,591
OIBDA(2) attributable to stockholders
$
26,492
$
23,167
$
20,051
$
15,558
$
27,558
Dry-docking expenditures for U.S.-flag petroleum and chemical carriers, dry bulk carriers and PCTC’s (included in operating costs and expenses)
$
4,310
$
1,925
$
1,581
$
6,430
$
399
Out-of-service days for dry-dockings of U.S.-flag petroleum and chemical carriers, dry bulk carriers and PCTC’s
42
30
15
147
—
Dry-docking expenditures for all other vessels
$
1,783
$
1,447
$
1,250
$
269
$
1,489
Inland Transportation & Logistics Services
Operating Revenues
$
72,020
$
61,455
$
65,602
$
77,513
$
78,845
Costs and Expenses:
Operating
62,775
54,486
54,245
60,801
65,667
Administrative and general
3,327
3,133
3,356
3,381
3,230
Depreciation and amortization
5,694
5,699
5,725
5,490
6,197
71,796
63,318
63,326
69,672
75,094
Gains on Asset Dispositions
330
330
420
481
513
Operating Income (Loss)
554
(1,533
)
2,696
8,322
4,264
Other Income (Expense):
Foreign currency gains (losses), net
(1,729
)
(191
)
459
(2,240
)
(282
)
Other, net
—
—
—
37
—
Equity in Losses of 50% or Less Owned Companies, Net of Tax
(1,084
)
(618
)
(2,472
)
(2,571
)
(1,245
)
Segment Profit (Loss)(1)
$
(2,259
)
$
(2,342
)
$
683
$
3,548
$
2,737
OIBDA(2)
$
6,248
$
4,166
$
8,421
$
13,812
$
10,461
SEACOR HOLDINGS INC. SEGMENT INFORMATION (continued) (in thousands, unaudited)
Three Months Ended
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Witt O’Brien’s
Operating Revenues
$
24,345
$
23,753
$
32,943
$
37,702
$
30,267
Costs and Expenses:
Operating
16,323
15,691
21,772
24,258
16,240
Administrative and general
5,718
6,831
6,402
6,876
7,389
Depreciation and amortization
210
209
206
660
492
22,251
22,731
28,380
31,794
24,121
Gains on Asset Dispositions and Impairments
10
—
—
—
—
Operating Income
2,104
1,022
4,563
5,908
6,146
Other Income (Expense):
Foreign currency losses, net
—
—
—
(1
)
(12
)
Other, net
(1
)
(2
)
(3
)
—
—
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
764
(128
)
(67
)
113
(13
)
Segment Profit
$
2,867
$
892
$
4,493
$
6,020
$
6,121
OIBDA(2)
$
2,314
$
1,231
$
4,769
$
6,568
$
6,638
Other
Operating Revenues
$
1,635
$
2,142
$
1,805
$
1,290
$
1,214
Costs and Expenses:
Operating
1,404
1,472
1,253
1,106
957
Administrative and general
846
837
839
551
606
Depreciation and amortization
501
493
489
237
202
2,751
2,802
2,581
1,894
1765
Gains (Losses) on Asset Dispositions
34
(2
)
—
37
—
Operating Loss
(1,082
)
(662
)
(776
)
(567
)
(551
)
Other Income (Expense):
Foreign currency losses, net
—
—
—
(4
)
—
Other, net
—
—
—
(105
)
452
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
(56
)
(266
)
(90
)
494
6
Segment Loss(1)
$
(1,138
)
$
(928
)
$
(866
)
$
(182
)
$
(93
)
Corporate and Eliminations
Operating Revenues
$
(3
)
$
(8
)
$
(98
)
$
(33
)
$
(8
)
Costs and Expenses:
Operating
(4
)
(8
)
(91
)
(25
)
(18
)
Administrative and general
5,628
6,490
5,951
5,778
5,688
Depreciation and amortization
379
378
379
416
427
6,003
6,860
6,239
6,169
6,097
Losses on Asset Dispositions
(33
)
—
—
—
—
Operating Loss
$
(6,039
)
$
(6,868
)
$
(6,337
)
$
(6,202
)
$
(6,105
)
Other Income (Expense):
Foreign currency losses, net
$
(44
)
$
(1
)
$
(7
)
$
(18
)
$
(10
)
Other, net
1
(1
)
10
96
1
______________________
Includes amounts attributable to both SEACOR and noncontrolling interests.
Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, unaudited)
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
ASSETS
Current Assets:
Cash and cash equivalents
$
76,815
$
138,757
$
141,152
$
144,221
$
324,564
Restricted cash and restricted cash equivalents
1,221
1,221
2,992
2,991
2,990
Marketable securities
6,038
39,368
33,384
30,316
41,445
Receivables:
Trade, net of allowance for doubtful accounts
199,013
164,964
174,278
171,828
151,217
Other
43,449
38,297
32,635
38,881
45,197
Inventories
5,224
5,293
4,914
4,530
5,139
Prepaid expenses and other
6,130
5,640
5,809
5,382
6,087
Total current assets
337,890
393,540
395,164
398,149
576,639
Property and Equipment:
Historical cost
1,424,907
1,416,084
1,413,488
1,407,329
1,403,886
Accumulated depreciation
(607,727
)
(593,168
)
(577,136
)
(560,819
)
(545,179
)
Net property and equipment
817,180
822,916
836,352
846,510
858,707
Operating Lease Right-of-Use Assets
153,464
161,518
167,325
—
—
Investments, at Equity, and Advances to 50% or Less Owned Companies
154,968
155,645
155,290
156,886
149,184
Construction Reserve Funds
3,908
3,908
3,908
3,908
5,908
Goodwill
32,668
32,714
32,720
32,708
32,767
Intangible Assets, Net
21,884
22,773
23,662
24,551
25,724
Other Assets
8,284
10,376
7,385
8,312
8,938
$
1,530,246
$
1,603,390
$
1,621,806
$
1,471,024
$
1,657,867
LIABILITIES AND EQUITY
Current Liabilities:
Current portion of long-term debt
$
76,426
$
78,301
$
8,308
$
8,497
$
155,737
Current portion of long-term operating lease liabilities
36,422
36,171
35,540
—
—
Accounts payable and accrued expenses
54,921
35,132
50,097
59,607
56,533
Other current liabilities
67,603
64,796
67,456
55,659
66,179
Total current liabilities
235,372
214,400
161,401
123,763
278,449
Long-Term Debt
241,408
234,445
315,303
346,128
372,657
Long-Term Operating Lease Liabilities
116,866
125,182
131,862
—
—
Deferred Income Taxes
103,489
99,938
97,758
94,420
99,565
Deferred Gains and Other Liabilities
20,463
20,768
20,688
52,871
60,502
Total liabilities
717,598
694,733
727,012
617,182
811,173
Equity:
SEACOR Holdings Inc. stockholders’ equity:
Preferred stock
—
—
—
—
—
Common stock
408
392
392
390
389
Additional paid-in capital
1,659,428
1,600,838
1,598,804
1,596,642
1,593,430
Retained earnings
519,023
512,618
498,065
474,809
479,495
Shares held in treasury, at cost
(1,365,594
)
(1,366,432
)
(1,366,267
)
(1,366,773
)
(1,366,773
)
Accumulated other comprehensive loss, net of tax
(1400
)
(995
)
(903
)
(914
)
(444
)
811,865
746,421
730,091
704,154
706,097
Noncontrolling interests in subsidiaries
783
162,236
164,703
149,688
140,597
Total equity
812,648
908,657
894,794
853,842
846,694
$
1,530,246
$
1,603,390
$
1,621,806
$
1,471,024
$
1,657,867
Use of non-GAAP Financial Measures
The information furnished in this release includes non-GAAP financial measures that differ from measures calculated in accordance with U.S. GAAP, including OIBDA and Cash Earnings.
The Company defines OIBDA as operating income (loss) plus depreciation and amortization. The Company includes maintenance and repair costs, including major overhauls and regulatory dry-dockings, and gains or losses (or impairments) on asset dispositions in OIBDA. The Company defines Cash Earnings as OIBDA further adjusted to exclude the amortization of non-cash deferred gains and amounts attributable to its minority partner in SEA-Vista as well as the gain or loss associated with marking-to-market securities held for investment, accrued net cash expense associated with interest on debt obligations, and the Company’s estimate of cash taxes. Other companies may calculate OIBDA and Cash Earnings differently than the Company, which may limit their usefulness as comparative measures. In addition, each of these measures does not necessarily represent funds available for discretionary use and are not measures of the Company’s ability to fund its cash needs. OIBDA and Cash Earnings are each financial metrics 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 Company officers and other shore-based employees; and (iii) to compare to the OIBDA and Cash Earnings of other companies when evaluating potential acquisitions. In addition, the Company believes Cash Earnings is meaningful to investors because it assists in evaluating the Company’s results of operations and net cash generated by business activities across previous and subsequent accounting periods and to better understand the long-term performance of the Company. The Company views OIBDA and Cash Earnings as measures of operating performance not liquidity.
The presentation of these non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.
The following tables reconcile these non-GAAP measures to their most closely comparable U.S. GAAP measures (amounts in thousands, except per share data).
Three Months Ended September 30,
Nine Months Ended September 30,
2019
2018
2019
2018
U.S. GAAP Measures
Net Income Attributable to Stockholders
$
6,405
$
17,067
$
28,691
$
62,834
Diluted Earnings Per Common Share(1)
$
0.32
$
0.88
$
1.48
$
3.21
Reconciliation of non-GAAP Financial Measures
Operating Income (U.S. GAAP)
$
12,519
$
34,047
$
42,593
$
60,749
(+) Depreciation and amortization
16,975
18,616
51,120
57,069
OIBDA(2)
29,494
52,663
93,713
117,818
(–) Amortization of deferred gains(3)
(330
)
(11,293
)
(991
)
(19,031
)
(–) OIBDA less amortization of deferred gains attributable to noncontrolling interests
(681
)
(9,687
)
(15,999
)
(21,698
)
(–) Cash interest expense, net(4)
(900
)
(3,301
)
(2,675
)
(11,029
)
(–) Income tax obligation
(6
)
(52
)
(19
)
(17,847
)
(+/–) Marketable security gains (losses), net
144
1,713
16,496
(1,303
)
Cash Earnings
$
27,721
$
30,043
$
90,525
$
46,910
______________________
Includes diluted earnings per common share of $0.01 and $0.06 for the quarter ended September 30, 2019 and 2018, respectively, related to marking-to-market the Company’s marketable security portfolio. Includes diluted earnings per common share of $0.65 and diluted loss per common share of $0.05 for the six months ended September 30, 2019 and 2018, respectively, related to marking-to-market the Company’s marketable security portfolio.
All references to OIBDA in this release are calculated in the same manner.
For the three and nine months ended September 30, 2019, amortization of deferred gains is included in gains on asset dispositions. For the three and nine months ended September 30, 2018, amortization of deferred gains may be included in operating expenses as a reduction to rental expense and/or included in gains on asset dispositions.
Amount is net of interest income, excludes capitalized interest, and is net of our partner’s portion of SEA-Vista interest expense of $0.2 million and $0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $1.2 million and $2.1 million for the nine months ended September 30, 2019 and 2018, respectively.
