Boots & Coots Reports Strong 3Q Results



Boots & Coots has reported net income of $5.4 million, or $0.07 per diluted share for the quarter ended September 30, 2008, compared to $1.3 million, or $0.02 per diluted share for the third quarter of last year and $6.1 million, or $0.08 per diluted share for the second quarter of this year.

Revenues for the third quarter were a record and increased 126% year over year and 8.8% sequentially to $56.5 million, compared to $25.0 million for the 2007 third quarter and $51.9 million for this year's second quarter. EBITDA (earnings before interest, income taxes, depreciation and amortization; see the reconciliation and rationale for this non-GAAP financial measure below), also a record, was $10.2 million, or 18.0% of revenues for the quarter compared to $4.1 million, or 16.4% of revenues for the third quarter of 2007 and $9.3 million, or 17.8% for the second quarter of 2008.

For the nine months ended September 30, 2008, Boots & Coots reported net income of $16.7 million, or $0.21 per diluted share, compared to $2.1 million, or $0.03 per diluted share for 2007. Revenues for the 2008 period were $153.4 million compared to $69.2 million for the prior year’s nine month period. EBITDA was $29.3 million for the nine months ended September 30, 2008 compared to $8.9 million for the 2007 period.

"While we continue to see strong demand for our services both internationally and domestically, we understand the concern over the effects of a downturn in domestic drilling in 2009," stated Jerry Winchester, president and chief executive officer. "We believe that our international operations give us a strategic advantage and provide a buffer relative to the potential negative impact caused by a downturn."

For the nine-month period, approximately 79% of Boots & Coots' revenues were generated internationally.

Business Segment Results

Well Intervention

For the quarter ended September 30, 2008, the Well Intervention segment generated record revenues of $53.9 million compared to $21.5 million third quarter of 2007 and $45.4 million of this year's second quarter. EBITDA for the third quarter was a record $9.9 million compared to $2.7 million for the third quarter of last year and $7.1 million for the second quarter of this year. For the nine months ended September 30, 2008, the Well Intervention segment generated revenues of $137.3 million and EBITDA of $24.1 million, compared to revenues of $60.7 million and EBITDA of $5.7 million for the 2007 nine month period.

The increases in revenues and EBITDA for the three and nine month periods were primarily due to new contracts and project activity in the company’s prevention business, strong international and domestic demand for snubbing/hydraulic workover services and growth in pressure control rental services.

Response

For the quarter ended September 30, 2008, the Response segment generated revenues of $2.6 million compared to $3.4 for the same period last year and $6.5 million for the prior quarter of this year. EBITDA for the quarter was $0.3 million compared to EBITDA of $1.4 million for the third quarter of 2007 and $2.2 million for the 2008 second quarter. For the nine months ended September 30, 2008, the Response segment generated revenues of $16.1 million and EBITDA of $5.1 million, compared to revenues of $8.5 million and EBITDA of $3.1 million for the 2007 nine month period. The improvement in revenues and EBITDA for the nine months was primarily due to increased international activity during the fist half of 2008.
 


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