Boots & Coots International Well Control, Inc. announced revenues of $54.7 million for the first quarter ended March 31, 2009, compared to revenues of $45.0 million for the same period last year. Net income for the quarter was $1.9 million, or $0.03 per diluted share, compared to $5.1 million, or $0.07 per diluted share for the first quarter of 2008. EBITDA (earnings before interest, income taxes, depreciation and amortization; see the reconciliation and rationale for this non-GAAP financial measure below) was $6.7 million for the quarter compared to $9.9 million for the first quarter of 2008.
"Internationally, growth in our prevention business remains strong, as does the growth in our rental tools business domestically, despite a falling North America rig count. This growth is the result of focusing on the right markets and delivering a value-added product." said Jerry Winchester, president and chief executive officer. "We did encounter challenges during the quarter such as the loss of a tender in Egypt. Competition for long term projects is a major component of our international business, and our expanded business development effort has already generated a number of replacement projects for which we are tendering. The company further invested in future revenue growth through expansion of our business development staff and other organizational structure costs."
"We also elected to suspend operations in Venezuela during the first quarter of 2009 until our customers there resume payments, forcing us to absorb the costs of maintaining our infrastructure. Boots and Coots has enjoyed a steady working history in Venezuela for the last 20 years and it has always been a mutually beneficial relationship," Mr. Winchester continued. "The national oil companies in Venezuela have a strong work ethic and we hope to continue to be their service provider for the next 20 years. However, until we start receiving payments on work already performed we will limit our financial exposure."
Business Segment Results
For the quarter ended March 31, 2009, the Pressure Control segment generated revenues of $27.0 million and EBITDA of $3.0 million, compared to revenues of $14.4 million and EBITDA of $4.4 million for the first quarter of 2008. Revenues were up primarily due to an international Safeguard project, which is expected to be completed in the second quarter of 2009. EBITDA margins were negatively impacted by higher third-party costs associated with the project and lower Response activity.
For the quarter ended March 31, 2009, the Well Intervention segment generated revenues of $20.5 million and EBITDA of $1.0 million, compared to revenues of $27.2 million and EBITDA of $5.1 million for the first quarter of 2008. The primary driver for the lower results was that the first quarter of 2008 included a major project in Bangladesh that was completed in the first quarter of last year. Additional items that negatively impacted results were the previously discussed tender in Egypt, a slowdown in North America regions of the Mid-Continent and Rocky Mountains that were partially offset by improved results in the Gulf of Mexico and Northeast regions. Also impacting the first quarter of this year was reduced business in the Middle East and Southern Asia.
For the quarter ended March 31, 2009, the Equipment Services segment generated revenues of $7.2 million and EBITDA of $2.8 million, compared to revenues of $3.4 million and EBITDA of $0.5 million for the first quarter of 2008. The increases in revenues and EBITDA were due to increased demand for the company's equipment rental services both internationally and in domestic operations.
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