Dril-Quip Revenues Increase 12% in Q4 2007



Dril-Quip, Inc. announced net income of $32.2 million, or $0.78 per diluted share for the three months ended December 31, 2007, versus net income of $24.9 million, or $0.61 per diluted share for the fourth quarter of 2006. Total revenues increased approximately 12% to $132.8 million for the quarter ended December 31, 2007 from $118.3 million for the same period in 2006 as the Company continued to experience strong worldwide demand for its products and services. Operating income increased to $36.1 million in the fourth quarter of 2007 from $33.8 million in the fourth quarter of 2006.

In the fourth quarter of 2007 the Company benefited from a foreign development tax incentive which resulted in a reduction in income taxes of approximately $4.7 million, or $0.11 per diluted share. As a result, the Company's effective tax rate for the fourth quarter of 2007 was 15.8% as compared to 29.5% for the fourth quarter of 2006.

For the twelve months ended December 31, 2007, net income was $107.9 million, or $2.63 per diluted share, compared with net income of $86.9 million, or $2.15 per diluted share, for the same period in 2006. Revenues for the twelve months ended December 31, 2007 were $495.6 million, up approximately 12% when compared to revenues of $442.7 million for the same period last year. Operating income increased to $138.4 million for the twelve months ended December 31, 2007 from $122.4 million during the same period of 2006.

The Company's effective tax rate for the twelve months ended December 31, 2007 was 26.2% as compared to 30.7% for the twelve months ended December 31, 2006. This reduction occurred primarily as a result of the foreign development tax incentive mentioned above. The Company anticipates that its effective tax rate for the year ended December 31, 2008 will be approximately 29%.

In addition, the Company announced that its backlog at December 31, 2007 was approximately $429 million, compared to its December 31, 2006 backlog of approximately $336 million. The Company expects its earnings per share for the quarter ending March 31, 2008 to approximate $0.62 to $0.72 per share, excluding any unusual or special charges.


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