FORM 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 30, 2012

 

 

SUPERIOR ENERGY SERVICES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-34037   75-2379388
(State or other jurisdiction)   (Commission File Number)   (IRS Employer Identification No.)
11000 Equity Drive, Suite 300, Houston, Texas   77041
(Address of principal executive offices)   (Zip Code)

(281) 999-0047

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.01 Completion of Acquisition or Disposition of Assets.

On March 30, 2012, Superior Energy Services, Inc. (the “Company”) completed the previously announced sale of 18 liftboats and related assets, constituting all of the assets comprising the Company’s marine segment, to subsidiaries of SEACOR Holdings, Inc. In consideration of the sale of these assets, the Company received cash proceeds of $134 million, plus an amount equal to the working capital conveyed to the buyers.

For reporting purposes, the results of operations of the Company’s marine segment will be included as income from discontinued operations in the Company’s first quarter 2012 results.

Pro forma financial information with respect to the sale is provided in Item 9.01 of this Current Report on Form 8-K.


Item 9.01 Financial Statements and Exhibits.

 

(b) Pro Forma Financial Information.

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

The following unaudited condensed consolidated pro forma financial information is based upon the historical financial statements of Superior Energy Services, Inc. and its consolidated subsidiaries (Superior), adjusted to reflect the disposition of its 18 liftboats and related assets, which constitutes all of the assets comprising the marine segment.

The following unaudited condensed consolidated pro forma financial information of Superior should be read in conjunction with the related notes and with the historical consolidated financial statements of Superior and the related notes included in previous filings with the Securities and Exchange Commission. The unaudited condensed pro forma consolidated balance sheet reflects the disposition of the marine segment as if it occurred on December 31, 2011 while the unaudited condensed pro forma statements of consolidated income give effect to the disposition as if it occurred on January 1, 2009. The pro forma adjustments, described in the related notes, are based on the best available information and certain assumptions that Superior’s management believes are reasonable.

The unaudited condensed consolidated pro forma financial information is presented for illustrative purposes only and does not purport to be indicative of the operating results or financial position that would have occurred if the transaction described above had occurred as presented in such statements. In addition, future results may vary significantly from the results reflected in such statements. For example, this financial information does not reflect any potential earnings or other impacts from the use of the proceeds from the disposition or cost reductions of previously allocated corporate costs and potential subsequent restructuring charges.


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

December 31, 2011

(in thousands)

 

     Superior
Historical
    Marine
Division
Historical
    Pro Forma
Consolidated
 

ASSETS

      

Current assets:

      

Cash and cash equivalents

   $ 80,274      $ 124,148  (a)    $ 204,422   

Accounts receivable, net

     540,602        (13,395 )(b)      527,207   

Prepaid Expenses

     34,037        —          34,037   

Inventory and other current assets

     228,309        —          228,309   
  

 

 

   

 

 

   

 

 

 

Total current assets

     883,222        110,753        993,975   
  

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

     1,507,368        (134,000 )(b)      1,373,368   

Goodwill

     581,379        —          581,379   

Notes receivable

     73,568        —          73,568   

Equity-method investments

     72,472        —          72,472   

Intangible and other long-term assets, net

     930,136        (3,874 )(b)      926,262   
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 4,048,145      $ (27,121   $ 4,021,024   
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

      

Current liabilities:

      

Accounts payable

   $ 178,645      $ 887  (b)    $ 179,532   

Accrued expenses

     197,574        (4,070 )(b)      193,504   

Income taxes payable

     717        40,447  (b)      41,164   

Deferred income taxes

     831        —          831   

Current portion of decommissioning liabilities

     14,956        —          14,956   

Current maturities of long-term debt

     810        (810 )(c)      —     
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     393,533        36,454        429,987   
  

 

 

   

 

 

   

 

 

 

Deferred income taxes

     297,458        (44,606 )(b)      252,852   

Decommissioning liabilities

     108,220        —          108,220   

Long-term debt

     1,685,087        (11,736 )(c)      1,673,351   

Other long-term liabilities

     110,248        —          110,248   

Stockholders' equity:

      

Common stock

     80        —          80   

Additional paid in capital

     447,007        —          447,007   

Accumulated other comprehensive loss, net

     (26,936     —          (26,936

Retained earnings

     1,033,448        (7,233 )(d)      1,026,215   
  

 

 

   

 

 

   

 

 

 

Total stockholders' equity

     1,453,599        (7,233     1,446,366   
  

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders' equity

   $ 4,048,145      $ (27,121   $ 4,021,024   
  

 

 

   

 

 

   

 

 

 

See accompanying notes to unaudited pro forma condensed consolidated financial information.


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended December 31, 2011

(in thousands, except per share data)

 

     Superior
Historical
    Marine
Division
Historical (e)
    Pro Forma
Consolidated
 

Revenues

   $ 2,070,166      $ (91,231   $ 1,978,935   

Cost and expenses:

      

Cost of services (exclusive of items shown separately below)

     1,118,003        (64,788     1,053,215   

Depreciation, depletion, amortization and accretion

     257,313        (10,858     246,455   

General and administrative expenses

     383,567        (6,047     377,520   

Reduction in value of assets

     46,096        (46,096     —     

Gain on sale of businesses

     8,558        (8,558     —     
  

 

 

   

 

 

   

 

 

 

Income from operations

     273,745        28,000        301,745   

Other income (expense):

      

Interest expense, net

     (68,439     850        (67,589

Earnings in equity-method investments, net

     16,394        —          16,394   
  

 

 

   

 

 

   

 

 

 

Income before income taxes

     221,700        28,850        250,550   

Income taxes

     79,146        8,681        87,827   
  

 

 

   

 

 

   

 

 

 

Net income

   $ 142,554      $ 20,169      $ 162,723   
  

 

 

   

 

 

   

 

 

 

Basic earnings per share:

   $ 1.79        $ 2.04   

Diluted earnings per share:

   $ 1.76        $ 2.01   

Weighted average common shares used in computing earnings per share:

      

Basic

     79,654          79,654   

Incremental common shares from stock-based compensation

     1,441          1,441   
  

 

 

     

 

 

 
     81,095          81,095   
  

 

 

     

 

 

 

See accompanying notes to unaudited pro forma condensed consolidated financial information.


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended December 31, 2010

(in thousands, except per share data)

 

     Superior
Historical
    Marine
Division
Historical (e)
    Pro Forma
Consolidated
 

Revenues

   $ 1,681,616      $ (94,247   $ 1,587,369   

Cost and expenses:

      

Cost of services (exclusive of items shown separately below)

     918,713        (66,813     851,900   

Depreciation, depletion, amortization and accretion

     220,835        (10,760     210,075   

General and administrative expenses

     342,881        (9,468     333,413   

Reduction in value of assets

     32,004        (32,004     —     

Gain on sale of businesses

     1,083        (1,083     —     
  

 

 

   

 

 

   

 

 

 

Income from operations

     168,266        23,715        191,981   

Other income (expense):

      

Interest expense, net

     (51,409     888        (50,521

Earnings in equity-method investments, net

     8,245        —          8,245   
  

 

 

   

 

 

   

 

 

 

Income before income taxes

     125,102        24,603        149,705   

Income taxes

     43,285        8,689        51,974   
  

 

 

   

 

 

   

 

 

 

Net income

   $ 81,817      $ 15,914      $ 97,731   
  

 

 

   

 

 

   

 

 

 

Basic earnings per share:

   $ 1.04        $ 1.24   

Diluted earnings per share:

   $ 1.03        $ 1.23   

Weighted average common shares used in computing earnings per share:

      

Basic

     78,758          78,758   

Incremental common shares from stock-based compensation

     976          976   
  

 

 

     

 

 

 
     79,734          79,734   
  

 

 

     

 

 

 

See accompanying notes to unaudited pro forma condensed consolidated financial information.


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended December 31, 2009

(in thousands, except per share data)

 

     Superior
Historical
    Marine
Division
Historical (e)
    Pro Forma
Consolidated
 

Revenues

   $ 1,449,300      $ (103,089   $ 1,346,211   

Cost and expenses:

      

Cost of services (exclusive of items shown separately below)

     824,034        (64,116     759,918   

Depreciation, depletion, amortization and accretion

     207,114        (11,467     195,647   

General and administrative expenses

     259,093        (15,550     243,543   

Reduction in value of assets

     212,527        —          212,527   

Gain on sale of businesses

     2,084        (2,084     —     
  

 

 

   

 

 

   

 

 

 

Loss from operations

     (51,384     (14,040     (65,424

Other income (expense):

      

Interest expense, net

     (49,409     1,204        (48,205

Losses in equity-method investments, net

     (22,600     —          (22,600

Reduction in value of equity-method investments

     (36,486     —          (36,486
  

 

 

   

 

 

   

 

 

 

Loss before income taxes

     (159,879     (12,836     (172,715

Income taxes

     (57,556     (4,826     (62,382
  

 

 

   

 

 

   

 

 

 

Net loss

   $ (102,323   $ (8,010   $ (110,333
  

 

 

   

 

 

   

 

 

 

Basic loss per share:

   $ (1.31     $ (1.41

Diluted loss per share:

   $ (1.31     $ (1.41

Weighted average common shares used in computing loss per share:

      

Basic

     78,171          78,171   

Incremental common shares from stock-based compensation

     —            —     
  

 

 

     

 

 

 
     78,171          78,171   
  

 

 

     

 

 

 

See accompanying notes to unaudited pro forma condensed consolidated financial information.


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

 

(a) To reflect the cash received for the disposition of the marine segment, the payment of the transaction costs and the payment of the U.S. Government guaranteed long-term financing under Title XI of the Merchant Marine Act of 1936, which is administered by the Maritime Administration, for two liftboats.

 

Selling price.

     134,000   

Working capital

     8,494   

Transaction-related costs

     (1,144

Payment of outstandingdebt and breakeage fees

     (17,202
  

 

 

 
     124,148   
  

 

 

 

 

(b) To reflect the disposition of the marine segment specified balance sheet accounts (primarily fixed assets and working capital accounts) as set forth in the asset purchase agreement dated February 22, 2012, the final amount of which will be determined subsequent to closing. The adjustments also reflect the accrual of estimated taxes of $40.4 million, costs of $2.5 million related to severance packages and a loss from early extinguishment of debt.

 

(c) To reflect the payment of $12.5 million related to U.S. Government guaranteed long-term financing under Title XI of the Merchant Marine Act of 1936, which is administered by the Maritime Administration, for two liftboats.

 

(d) To reflect additional estimated losses, net of tax, at the time of sale of approximately $7.2 million from the disposition of the marine segment. This loss does not include the reduction in value of assets that was recorded in the fourth quarter of 2011 of $46.1 million to approximate the fair market value of the marine segment as of December 31, 2011.

 

(e) To reflect the removal of the operating results of the marine segment as if the transaction occurred on January 1, 2009. For the purposes of this unaudited pro forma condensed consolidated financial information, estimated tax rates of 30.1%, 35.3% and 37.6% have been used for the twelve months ended December 31, 2011, 2010 and 2009, respectively. The estimated income tax rates are based on applicable enacted statutory tax rates for the periods referenced above.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

SUPERIOR ENERGY SERVICES, INC.
By:   /s/ Robert S. Taylor
 

Robert S. Taylor

Chief Financial Officer

Dated: April 5, 2012