Vantage Drilling International Ltd. Reports Second Quarter 2024 Results

/EIN News/ -- DUBAI, United Arab Emirates, Aug. 13, 2024 (GLOBE NEWSWIRE) -- Vantage Drilling International Ltd. ("Vantage" or the “Company”) reported a net loss attributable to shareholders of approximately $14.2 million or $1.07 per diluted share for the three months ended June 30, 2024, based on weighted average shares outstanding, as compared to a net income attributable to shareholders of approximately $1.5 million or $0.11 per diluted share for the three months ended June 30, 2023.

As of June 30, 2024, Vantage had approximately $50.8 million in cash. This total includes $10.5 million of restricted cash and $12.8 million pre-funded by our Managed Services customers for near-term obligations. In comparison, on December 31, 2023, Vantage had $84.0 million in cash, including $10.8 million of restricted cash and $11.6 million pre-funded by our Managed Services customers.

Ihab Toma, CEO, commented: "The Company continued to perform well operationally and financially during the quarter, even with the Topaz Driller and Platinum Explorer undergoing major upgrades. The Topaz Driller continues to prepare for its upcoming contract while the Platinum Explorer enhances its marketability."

Mr. Toma continued, “EBITDA generation of $4.6 million during the quarter reflects the efficiency of our operations and the dedication of our employees during this transitional period.”

Vantage, a Bermuda exempted company, is an offshore drilling contractor, with a fleet of two ultra-deepwater drillships, and two premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells globally for major, national and independent oil and gas companies. Vantage also markets, operates and provides management services in respect of, third party-owned drilling units. www.vantagedrilling.com.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the Company's reports or filings posted to its website or otherwise made available to its investors or creditors. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements. Vantage disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Non-GAAP Measures

We report our financial results in accordance with generally accepted accounting principles (GAAP) in the United States. However, in our earnings release and during our earnings calls we may reference company information that does not conform to GAAP. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the Company and allows investors to better evaluate the financial results of the Company. However, these measures should not be viewed as an alternative to or substitute for GAAP measures of performance, and these non-GAAP measures may not be consistent with previously published Company reports on Forms 10-K, 10-Q and 8-K. Non-GAAP measures we may reference have been reconciled to the nearest GAAP measure in the tables entitled Reconciliation of GAAP to Non-GAAP Financial Measures below.

Public & Investor Relations Contact:
Rafael Blattner
Chief Financial Officer
Vantage Drilling International Ltd.
+971 4 449 34 28

Vantage Drilling International Ltd.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Revenue
Contract drilling services		$	34,100			$	67,673			$	94,329			$	115,590
Management fees			5,697				5,569				11,223				7,689
Reimbursables and other			10,015				34,598				20,408				61,633
Total revenue			49,812				107,840				125,960				184,912
Operating costs and expenses
Operating costs			39,561				74,383				92,284				140,938
General and administrative			5,225				5,161				12,479				9,992
Depreciation			11,257				11,045				22,492				22,094
(Gain) loss on EDC Sale			—				—				—				3
Total operating costs and expenses			56,043				90,589				127,255				173,027
Income (loss) from operations			(6,231	)			17,251				(1,295	)			11,885
Other (expense) income
Interest income			200				141				494				190
Interest expense and other financing charges			(5,656	)			(5,346	)			(11,000	)			(10,904	)
Other, net			(383	)			(457	)			(978	)			(135	)
Total other expense			(5,839	)			(5,662	)			(11,484	)			(10,849	)
Income (loss) before income taxes			(12,070	)			11,589				(12,779	)			1,036
Income tax provision			2,141				10,584				4,622				2,606
Net income (loss)			(14,211	)			1,005				(17,401	)			(1,570	)
Net income (loss) attributable to non-controlling interests			10				(457	)			(309	)			(746	)
Net income (loss) attributable to shareholders		$	(14,221	)		$	1,462			$	(17,092	)		$	(824	)
EBITDA(1)		$	4,643			$	27,839			$	20,219			$	33,844
Earnings (loss) per share
Basic and Diluted		$	(1.07	)		$	0.11			$	(1.29	)		$	(0.06	)
Weighted average ordinary shares outstanding,
Basic			13,295				13,229				13,266				13,204
Diluted			13,295				13,320				13,266				13,204
(1) EBITDA represents net income (loss) before (i) interest income (expense), (ii) provision for income taxes and (iii) depreciation and amortization expense. EBITDA is not a financial measure under GAAP as defined under the rules of the SEC, and is intended as a supplemental measure of our performance. We believe this measure is commonly used by analysts and investors to analyze and compare companies on the basis of operating performance.

Vantage Drilling International Ltd.
Supplemental Operating Data
(in thousands, except percentages)
(Unaudited)
		Three Months Ended June 30,									Six Months Ended June 30,
		2024				2023					2024					2023
Operating costs and expenses
Jackups		$	4,980			$	3,736				$	16,170				$	7,722
Deepwater			21,547				24,154					46,264					43,118
Managed Rigs			-				17,319					4,570					34,258
Operations support			3,171				2,924					6,167					5,575
Reimbursables			9,863				26,250					19,113					50,265
Total operating costs and expenses		$	39,561			$	74,383				$	92,284				$	140,938
Utilization
Jackups			50.0	%			94.4	%				69.9	%				97.2	%
Deepwater			43.4	%			95.2	%				55.5	%				79.1	%

Vantage Drilling International Ltd.
Condensed Consolidated Balance Sheets
(In thousands, except share and par value information)
(Unaudited)
		June 30, 2024				December 31, 2023
ASSETS
Current assets
Cash and cash equivalents		$	40,290			$	73,206
Restricted cash			2,264				1,828
Trade receivables, net of allowance for credit losses of $5,805 and $5,434, respectively			56,534				74,113
Materials and supplies			52,470				46,704
Prepaid expenses and other current assets			35,501				37,423
Total current assets			187,059				233,274
Property and equipment
Property and equipment			677,304				660,449
Accumulated depreciation			(374,459	)			(352,357	)
Property and equipment, net			302,845				308,092
Operating lease ROU assets			658				1,084
Other assets			42,313				19,283
Total assets		$	532,875			$	561,733
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable		$	60,730			$	62,245
Other current liabilities			38,277				51,946
Total current liabilities			99,007				114,191
Long–term debt, net of discount and financing costs of $8,706 and $9,893 respectively			191,294				190,107
Other long-term liabilities			12,725				10,741
Shareholders' equity
Ordinary shares, $0.001 par value, 50 million shares authorized; 13,295,262 and 13,229,280 shares issued and outstanding, each period			13				13
Additional paid-in capital			634,519				633,963
Accumulated deficit			(405,615	)			(388,523	)
Controlling interest shareholders' equity			228,917				245,453
Noncontrolling interests			932				1,241
Total equity			229,849				246,694
Total liabilities and shareholders' equity		$	532,875			$	561,733

Vantage Drilling International Ltd.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
		Six Months Ended June 30,
		2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(17,401	)		$	(1,570	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation expense			22,492				22,094
Amortization of debt financing costs			1,449				862
Share-based compensation expense			1,069				25
Loss on debt extinguishment			—				703
Deferred income tax expense			420				733
Loss on disposal of assets			81				—
Loss on EDC Sale			—				3
Allowance for credit losses			371				—
Changes in operating assets and liabilities:
Trade receivables, net			17,208				(20,333	)
Materials and supplies			(5,766	)			(3,509	)
Prepaid expenses and other current assets			1,922				(5,379	)
Other assets			(22,340	)			5,269
Accounts payable			(1,515	)			(2,205	)
Other current liabilities and other long-term liabilities			(9,278	)			(7,773	)
Net cash used in operating activities			(11,288	)			(11,080	)
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment			(17,396	)			(2,637	)
Proceeds from disposal of assets			70				—
Net cash used in investing activities			(17,326	)			(2,637	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from 9.50% First Lien Notes			—				194,000
Repayment of long-term debt			—				(180,000	)
Shares repurchased for tax withholdings on settlement of RSUs			(441	)			(246	)
Payments of dividend equivalents			(3,272	)			(5,278	)
Debt issuance costs			(837	)			(5,645	)
Net cash (used in) provided by financing activities			(4,550	)			2,831
Net decrease in unrestricted and restricted cash and cash equivalents			(33,164	)			(10,886	)
Unrestricted and restricted cash and cash equivalents—beginning of period			83,975				93,257
Unrestricted and restricted cash and cash equivalents—end of period		$	50,811			$	82,371

Vantage Drilling International Ltd.
Non-GAAP Measures
(In thousands)
(Unaudited)
		Three Months Ended June 30,								Six Months Ended June 30,
Reconciliation of EBITDA		2024				2023				2024				2023
Net income (loss)		$	(14,211	)		$	1,005			$	(17,401	)		$	(1,570	)
Depreciation			11,257				11,045				22,492				22,094
Interest income			(200	)			(141	)			(494	)			(190	)
Interest expense and other financing costs			5,656				5,346				11,000				10,904
Income tax provision			2,141				10,584				4,622				2,606
EBITDA		$	4,643			$	27,839			$	20,219			$	33,844

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