HERCULES OFFSHORE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended September 30,
2006 2005
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $83,524 $29,662
Adjustments to reconcile net
income to net cash provided by
operating activities
Depreciation and amortization 22,582 9,075
Stock based compensation expense 2,277 -
Deferred income taxes 27,652 -
Amortization of deferred
financing fees 506 714
Provision for bad debts 160 (519)
Loss on early retirement of debt - 2,786
Gain on disposal of assets (30,690) -
Gain on sale of assets (89) -
(Increase) decrease in operating
assets
Increase in accounts receivable (28,552) (15,293)
Increase in insurance claims
receivable (7,913) (193)
Increase in prepaid expenses and
other (23,397) (4,147)
Increase (decrease) in operating
liabilities
Increase in accounts payable 16,420 4,783
Increase in insurance note
payable 9,629 4,175
Increase in other current
liabilities 12,335 6,667
Increase in other liabilities 526 -
Net cash provided by operating
activities 84,970 37,710
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and
equipment (143,282) (115,571)
Deferred drydocking expenditures (8,967) (4,617)
Insurance proceeds received 50,090 -
Proceeds received from sale of
assets, net of commissions 5,989 454
Increase in restricted cash (250) -
Decrease (increase) in deposits (276) 1,999
Net cash used in investing
activities (96,696) (117,735)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings - 185,000
Payment of debt (1,050) (101,000)
Proceeds from issuance of common
stock 54,198 -
Proceeds from exercise of stock
options 340 -
Payment of debt issuance costs (639) (6,008)
(Distributions to) contributions
from members (3,732) 4,329
Net cash provided by financing
activities 49,117 82,321
NET INCREASE IN CASH AND CASH
EQUIVALENTS 37,391 2,296
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 47,575 14,460
CASH AND CASH EQUIVALENTS AT END OF
PERIOD $84,966 $16,756
(CONTINUA)
