Net income for fiscal 2006 was $15,855,000 compared to $10,016,000 in fiscal 2005, an increase of 58%. Earnings per share for fiscal 2006 were $2.11 compared to $1.50 in fiscal 2005. Reflected in the fiscal 2006 per share data is a full year of the 1,800,000 additional shares of stock issued by the Company in a public offering completed in March, 2005. Cash flow provided by operating activities increased 109 percent from $12,300,000 to $25,743,000 in fiscal 2006. The Company's EBITDA for fiscal 2006 was $38,551,000 compared to $22,766,000 in fiscal 2005, an increase of 69 percent.
Capital expenditures of $40,377,000 in fiscal 2006 were used, in part, to complete the fielding of an additional data acquisition crew equipped with a 5000 channel Aram ARIES recording system in June of 2006, to expand channel count on existing crews, to purchase additional energy source units, and to replace an I/O System II recording system on an existing crew with a 5000 channel Aram ARIES recording system in September of 2006. The purchase of the second Aram ARIES was originally planned as a fiscal 2007 budget item.
The Company's Board of Directors had approved an initial fiscal 2007 capital budget of $20,000,000, of which, $4,900,000 was used as part of the purchase of the second Aram ARIES recording system and captured as an increase to the fiscal 2006 capital budget due to earlier than anticipated delivery and deployment of the system. The balance of the capital budget will be used to add to the Company's energy source fleet, make technical improvements in various phases of the Company's operations, and meet maintenance capital requirements. These expenditures will allow the Company to maintain its competitive position as it responds to client desire for higher resolution subsurface images.
Fourth Quarter Results
For the fourth quarter 2006, Dawson Geophysical reported record revenues of $51,491,000 compared to $37,089,000 for the comparable 2005 period, an increase of 39 percent. Revenue growth in the fourth quarter was primarily due to price improvements for the Company's services, expanded capabilities of existing crews, and the operation of the twelfth crew. Recorded in the fourth quarter revenues are unusually high third party charges primarily related to the use of helicopter support services, specialized survey technologies, and dynamite energy sources all of which are utilized in areas with limited access. The increase in these charges was driven by the Company's continued geographic expansion in response to exploration activities in the Appalachian Basin, the Rocky Mountains, the Fayetteville Shale in Arkansas, and the Arkoma Basin. The Company is reimbursed for these expenses by its clients.
Net income for the fourth quarter of fiscal 2006 was $4,963,000 compared to $2,732,000 in the comparable 2005 period, an increase of 82 percent. Earnings per share were $0.66 for the fourth quarter of fiscal 2006 compared to $0.37 per share in the fourth quarter of 2005. EBITDA increased 80 percent in the fourth quarter from $6,765,000 in fiscal 2005 to $12,145,000 in fiscal 2006.
Stephen Jumper, President and CEO of Dawson Geophysical Company said, "Fiscal 2006, our 25th year as a public company, was a record year in terms of revenue, net income, and EBITDA. The same can be said on a quarterly basis for the fourth quarter of fiscal 2006. Our financial performance has been fueled by our growth in recent years in both crew count and channel count."
Mr. Jumper, continued, "Since early 2005, we have expanded from nine data acquisition crews to twelve crews at the end of fiscal 2006, from approximately 38,000 recording channels to in excess of 70,000 recording channels, and from 803 employees to 1,023 employees. The Company's expansion is in response to continued demand for the geophysical services we provide as a result of increased exploration efforts by oil and gas companies."
Fourth Quarter and Year-end Highlights
During the first quarter of fiscal 2007 the Company provisionally fielded an additional data acquisition crew with the redeployment of an existing I/O System II recording system and intends to deploy this crew from time to time as opportunities arise. With the addition of the newest crew, Dawson currently operates thirteen crews across the lower 48 states. Of the thirteen crews two are equipped with Aram ARIES recording systems, six with I/O System II RSR recording systems, four with I/O System II cable based recording systems, and one with the Q-Land recording system under an agreement with WesternGeco. Eleven of the thirteen crews are currently utilizing vibrator energy source units.
Mr. Jumper concluded, "Demand for our services continues at record levels as a result of continued exploration and development activities by our client base despite recent changes in oil and natural gas prices. Our current order book remains strong and reflects commitments sufficient to maintain operations at full capacity well into calendar 2007. In response to this continued demand, we provisionally fielded an additional data acquisition crew, our thirteenth crew, with the redeployment of an existing I/O System II in the first quarter of fiscal 2007. We look forward to 2007 with great enthusiasm as our employees continue to deliver value for our clients and shareholders."
Dawson Geophysical Company is the leading provider of U.S. onshore seismic data acquisition services as measured by the number of active data acquisition crews. Founded in 1952, Dawson acquires and processes 2-D, 3-D, and multi-component seismic data solely for its clients, ranging from major oil and gas companies to independent oil and gas operators as well as providers of multi-client data libraries.
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