HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
REVENUES
Contract drilling services $47,965 $42,567 $111,672 $69,564
Marine services 51,079 33,730 97,836 62,866
99,044 76,297 209,508 132,430
COSTS AND EXPENSES
Operating expenses for contract
drilling services, excluding
depreciation and amortization 21,234 13,822 42,180 24,929
Operating expenses for marine
services, excluding
depreciation and amortization 23,162 12,438 43,743 23,267
Depreciation and amortization 12,209 7,551 23,939 13,485
General and administrative,
excluding depreciation and
amortization 9,335 6,601 18,498 13,187
65,940 40,412 128,360 74,868
OPERATING INCOME 33,104 35,885 81,148 57,562
OTHER INCOME (EXPENSE)
Interest expense (1,379) (2,163) (3,469) (4,249)
Gain on disposal of assets -- -- -- 29,580
Loss on early retirement of debt (870) -- (870) --
Other, net 1,246 1,520 2,521 1,823
INCOME BEFORE INCOME TAXES 32,101 35,242 79,330 84,716
INCOME TAX PROVISION (8,635) (12,309) (22,473)(30,871)
NET INCOME $23,466 $22,933 $56,857 $53,845
EARNINGS PER SHARE:
Basic $0.73 $0.73 $1.77 $1.75
Diluted $0.72 $0.71 $1.74 $1.70
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic 32,099 31,480 32,037 30,826
Diluted 32,813 32,367 32,642 31,666
HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended June 30,
2007 2006
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $56,857 $53,845
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 23,939 13,485
Stock-based compensation expense 2,881 1,461
Deferred income taxes 5,031 17,379
Amortization of deferred financing fees 293 327
Excess tax benefit from stock-based
arrangements (1,731) --
Loss on early retirement of debt 870 --
Gain on disposal of assets (296) (29,580)
(Increase) decrease in operating assets -
Accounts receivable 14,146 (20,773)
Insurance claims receivable (5,853) (8,892)
Prepaid expenses and other 2,482 1,437
Increase (decrease) in operating
liabilities -
Accounts payable 1,703 7,876
Insurance note payable (6,058) (2,401)
Other current liabilities (7,898) 8,230
Other liabilities (284) 625
Net cash provided by operating
activities 86,082 43,019
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in marketable securities (61,500) --
Proceeds from sale of marketable securities 37,600 --
Purchase of property and equipment (38,133) (118,936)
Deferred drydocking expenditures (9,864) (6,534)
Insurance proceeds received -- 50,090
Proceeds from sale of assets, net of
commissions 610 --
Net cash used in investing
activities (71,287) (75,380)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of debt (37,700) (700)
Proceeds from issuance of common stock -- 54,199
Proceeds from exercise of stock options 1,510 221
Excess tax benefit from stock-based
arrangements 1,731 --
Payment of debt issuance costs (441) (632)
Distributions to members -- (3,732)
Other (46) --
Net cash provided by (used in)
financing activities (34,946) 49,356
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (20,151) 16,995
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 72,772 47,575
CASH AND CASH EQUIVALENTS AT END OF PERIOD $52,621 $64,570
(CONTINUA)
