Boots & Coots Announces Record Results for 2003

Boots & Coots International Well Control, Inc. (Amex: WEL) reported that revenues for fiscal 2003 were up 155 percent to $35.9 million, compared to revenues of $14.1 million for 2002. For the fourth quarter, revenues increased by 237 percent to $8.9 million, compared with revenues of $2.6 million for the same period of 2002.

The company's income from continuing operations was $6.6 million for 2003 compared to a loss of $2.5 million for 2002. Net income was $7.1 million compared to a net loss of $9.2 million in the prior year. Included in 2003 net income is a non-cash, non-recurring charge of $1.4 million related to the settlement of certain liabilities. Included in 2002 net income is a non-cash non-recurring credit of $1.1 million related to a favorable bankruptcy settlement related to its former subsidiary International Tool and Supply Company. Net income attributable to common shareholders for 2003 was $5.9 million, or $0.26 per diluted share, compared to a net loss in 2002 of $12.3 million, or a $1.14 loss per fully diluted share. For the fourth quarter, net income from continuing operations was $1.0 million compared to a net loss of $1.6 million for the fourth quarter of 2002. Net income attributable to common shareholders was $1.0 million, or $0.04 per fully diluted share in the fourth quarter of 2003, compared to a net loss in the prior period of $2.3 million, or a $0.21 loss per fully diluted share.

Earnings before interest, taxes, depreciation and amortization (EBITDA) increased by $11.6 million to $11.2 million in 2003. For the fourth quarter, EBITDA was $1.9 million compared to a deficit of $0.5 million in the fourth quarter of 2002.

"Revenues were strong in both of the company's business segments," stated Jerry Winchester, President and Chief Executive Officer. "Response revenues were, of course, principally driven by our work in Iraq. Our prevention segment was a very strong performer for the year due to the continuing success of our SafeGuard and WELLSURE(R) programs. We believe that with the successful implementation of the 2004 business plan our prevention revenues will be sufficient to sustain our current operations." Earlier this month, the company announced that, pending the transition to the new contract for the Restore Iraqi Oil (RIO) program, the company has temporarily demobilized its personnel in the region. Currently, it is unclear when the company will re- mobilize its personnel, although the company remains positioned to continue its previous work and respond immediately whenever an emergency arises in Iraq.

"Last year was a year of great progress," stated Kirk Krist, Chairman of the Board. "We paid down or converted to common equity most of our senior debt and preferred stock, we restructured our remaining senior and subordinated debt into long-term debt and we strengthened the leadership of our board. We are now able to direct our energies into the growth of the business."

Operational highlights include:

  • Prevention revenues were $3.6 million and $16.1 million for the fourth quarter and year, respectively. In 2003, the company secured two major SafeGuard contracts worth approximately $3 million over the next two years. In 2003, the company introduced WELLSURE(R) into Canada and secured 17 new contracts. Since the beginning of 2004, Boots & Coots has secured one new SafeGuard contract located in India.
  • Response revenues were $5.4 million and $19.8 million for the fourth quarter and year, respectively.
  • Revenues earned from Iraq related work were $5.0 million for the fourth quarter and $22.6 million for the year, which includes a first quarter equipment sale of $6.6 million.
  • At December 31, 2003 the company reported working capital of $9.5 million and long-term debt of $12.4 million.
  • Shareholders' equity improved $14.4 million during the year to $0.4 million from a deficit of $14.0 million at December 31, 2002.
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