SEACOR Holdings Announces Results for the Year and Fourth Quarter Ended December 31, 2019
FORT LAUDERDALE, Fla., Feb. 28, 2020 (GLOBE NEWSWIRE) -- SEACOR Holdings Inc. (NYSE:CKH) (the “Company”) today announced its results for the year and fourth quarter ended December 31, 2019:
Net income attributable to stockholders for the year ended December 31, 2019 was $26.8 million ($1.38 per diluted share) compared with $58.1 million ($3.04 per diluted share) for the year ended December 31, 2018. The prior year benefited from a net gain of $42.6 million ($2.18 per diluted share) related to the sale of the Company's interest in Hawker Pacific Airservices ("Hawker").
Net loss attributable to stockholders for the quarter ended December 31, 2019 was $1.9 million ($0.10 per diluted share) compared with $4.7 million ($0.26 per diluted share) for the quarter ended December 31, 2018. The prior year quarter benefited from $5.5 million ($0.30 per diluted share) of net income related to the accelerated amortization of non-cash deferred gains. Excluding these non-cash gains, loss per diluted share for the quarter ended December 31, 2019 improved by $0.46 compared with the quarter ended December 31, 2018.
“Cash Earnings” for the year ended December 31, 2019, after expensing all charges for maintenance, were $110.6 million compared with $57.8 million for the year ended December 31, 2018 and were $20.1 million for the quarter ended December 31, 2019 compared with $10.6 million for the same quarter last year.
The Company uses the non-GAAP financial measures "Cash Earnings" and OIBDA in this release; a reconciliation to their closest U.S. GAAP measure is included in "Use of non-GAAP Financial Measures" in this release.
Charles Fabrikant, Executive Chairman, commented on the quarter's results as follows:
"Cash earnings almost doubled in 2019 compared with 2018 as several of our businesses had record performance. SEACOR Island Lines had its best year ever, with growth in demand for shipments into the Bahamas and Caribbean. Waterman Logistics was successful in winning several significant U.S. government cargo moves throughout the year. Our Jones Act dry bulk vessels produced good cash and harbor towing had 5% more ship assists over last year. Unfortunately, the inland business battled severe headwinds. The St. Louis harbor was closed for about 40 days this past year bringing activity to a virtual standstill for our terminals and fleets. The trade war with China severely curtailed grain exports. Witt O'Brien's also had less activity than 2018.
In 2019, we expensed approximately $23 million in dry-docking costs and overhauls to maintain our assets. The related out-of-service time cost us approximately $7 million in lost revenue.”
The "Operating Discussion" below is a comparison of results for the quarter ended December 31, 2019 with the prior year quarter ended December 31, 2018.
Operating Discussion
Ocean Transportation & Logistics Services - Operating income and OIBDA were $7.6 million and $17.8 million, in the current year quarter compared with $10.8 million and $21.5 million excluding the accelerated amortization of previously deferred gains of $7.0 million in the prior year quarter, respectively. Operating results were impacted by $9.0 million of regulatory dry-docking costs. $2.3 million more than the prior year quarter. During the quarter Ocean Services docked one U.S.-flag petroleum and chemical carrier and one PCTC.
SEACOR Island Lines activity continued to increase in its core markets and it also experienced a boost in demand due to Hurricane Dorian recovery efforts. Waterman Logistics had increased success this quarter winning bids to move specialized cargo for the U.S. government. The dry bulk carrier fleet benefited from steady cargo volumes and a full quarter of operations with no dry-dockings. In the aggregate, these service lines had a positive incremental contribution of $9.9 million compared with the prior year quarter.
Inland Transportation & Logistics Services - Operating income and OIBDA were $1.4 million and $7.5 million in the current year quarter compared with $8.3 million and $13.8 million in the prior year quarter, respectively. U.S. grain exports through the Center Gulf were down 8% compared with the fourth quarter of 2018, reducing demand for barge freight and negatively impacting activity levels at the terminals and fleets on the Mississippi and Illinois Rivers. The primary culprits were the China trade war, U.S. government farm subsidy programs which were a disincentive to exports, and competition from South America. Operating results for Inland Services also continued to be impacted by higher costs due to the prolonged flooding experienced earlier in the year and resulting high-water conditions.
Witt O’Brien’s - Operating loss and negative OIBDA were $(0.7) million and $(0.5) million, respectively, in the current year quarter compared with operating income and OIBDA of $5.9 million and $6.6 million, respectively, in the prior year quarter. The primary factors impacting the current year quarter's results were a lack of activity responding to seasonal storms, lower activity in the U.S. Virgin Islands and a bad debt charge of $0.8 million.
Capital Commitments - The Company’s capital commitments as of December 31, 2019 were $62.2 million and included four U.S.-flag harbor tugs, the Company's interest in two foreign-flag rail ferries, four inland river dry-cargo barges, two inland river towboats, other equipment and vessel and terminal improvements. Subsequent to December 31, 2019, the Company committed to purchase two inland river dry-cargo barges and other equipment for $2.5 million.
Liquidity and Debt - During the current year quarter, the Company repurchased $1.8 million in principal amount of its 3.0% Convertible Senior Notes for $1.8 million. Subsequent to December 31, 2019, the Company repurchased $2.2 million in principal amount of its 3.0% Convertible Senior Notes for $2.2 million.
As of December 31, 2019, the Company’s balances of cash, cash equivalents, restricted cash, restricted cash equivalents, and marketable securities totaled $86.4 million. As of December 31, 2019, total outstanding debt was $314.5 million and the Company had $225.0 million of borrowing capacity under its credit facilities.
Equity - As of December 31, 2019, the total shares outstanding were 20,176,168.
SEACOR Holdings Inc. (“SEACOR”) is a diversified holding company with interests in domestic and international transportation and logistics and risk management consultancy. SEACOR is publicly traded on the New York Stock Exchange (NYSE) under the symbol CKH.
Certain statements discussed in this release as well as in other reports, materials and oral statements that the Company releases from time to time to the public constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “believe,” “plan,” “target,” “forecast” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements concern management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by management of the Company. These statements are not guarantees of future performance and actual events or results may differ significantly from these statements. Actual events or results are subject to significant known and unknown risks, uncertainties and other important factors, including risks relating to weakening demand for the Company’s services as a result of unplanned customer suspensions, cancellations, rate reductions or non-renewals of vessel charters or failures to finalize commitments to charter vessels, increased government legislation and regulation of the Company’s businesses that could increase the cost of operations, increased competition if the Jones Act is repealed, liability, legal fees and costs in connection with the provision of emergency response services, decreased demand for the Company’s services as a result of declines in the global economy, declines in valuations in the global financial markets and a lack of liquidity in the credit sectors, including, interest rate fluctuations, availability of credit, inflation rates, change in laws, trade barriers, commodity prices and currency exchange fluctuations, activity in foreign countries and changes in foreign political, military and economic conditions, changes in foreign and domestic oil and gas exploration and production activity, safety record requirements related to Ocean Transportation & Logistics Services, decreased demand for Ocean Transportation & Logistics Services due to construction of additional refined petroleum product, natural gas or crude oil pipelines or due to decreased demand for refined petroleum products, crude oil or chemical products or a change in existing methods of delivery, compliance with U.S. and foreign government laws and regulations, including environmental laws and regulations and economic sanctions, the dependence of Ocean Transportation & Logistics Services and Inland Transportation & Logistics Services on several key customers, consolidation of the Company’s customer base, the ongoing need to replace aging vessels, industry fleet capacity, restrictions imposed by the Shipping Acts on the amount of foreign ownership of the Company’s Common Stock, operational risks of Ocean Transportation & Logistics Services and Inland Transportation & Logistics Services, effects of adverse weather conditions and seasonality, the level of grain export volume, the effect of fuel prices on barge towing costs, variability in freight rates for inland river barges, the effect of international economic and political factors on Inland Transportation & Logistics Services’ operations, the ability to realize anticipated benefits from acquisitions and other strategic transactions, adequacy of insurance coverage, the attraction and retention of qualified personnel by the Company, changes in U.S. and international trade policies and various other matters and factors, many of which are beyond the Company’s control as well as those discussed in Item 1A. (Risk Factors) of the Company’s Annual report on Form 10-K and other reports filed by the Company with the Securities and Exchange Commission (“SEC”). It should be understood that it is not possible to predict or identify all such factors. Consequently, the preceding should not be considered to be a complete discussion of all potential risks or uncertainties. Given these factors, investors and analysts should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its filings with the SEC, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (if any). These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995.
For additional information, contact Investor Relations at (954) 627-5278 or visit SEACOR’s website at www.seacorholdings.com.
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands, except share data, unaudited)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2019
2018
2019
2018
Operating Revenues
$
192,761
$
213,838
$
799,966
$
835,750
Costs and Expenses:
Operating
146,265
150,374
583,633
591,848
Administrative and general
27,134
26,718
105,517
102,907
Depreciation and amortization
17,451
17,510
68,571
74,579
190,850
194,602
757,721
769,334
Gains on Asset Dispositions, Net
651
6,014
2,910
19,583
Operating Income
2,562
25,250
45,155
85,999
Other Income (Expense):
Interest income
1,488
2,245
7,471
8,730
Interest expense
(4,401
)
(6,181
)
(19,233
)
(31,683
)
Debt extinguishment losses, net
(171
)
(6,017
)
(2,244
)
(11,626
)
Marketable security gains (losses), net
1,898
(11,128
)
18,394
(12,431
)
Foreign currency gains (losses), net
1,351
(2,280
)
(312
)
(2,264
)
Other, net
(20
)
13
(134
)
54,964
145
(23,348
)
3,942
5,690
Income Before Income Tax Expense (Benefit) and Equity in Losses of 50% or Less Owned Companies
2,707
1,902
49,097
91,689
Income Tax Expense (Benefit)
2,817
(4,519
)
9,829
8,415
Income (Loss) Before Equity in Losses of 50% or Less Owned Companies
(110
)
6,421
39,268
83,274
Equity in Losses of 50% or Less Owned Companies, Net of Tax
(1,802
)
(1,987
)
(5,250
)
(72
)
Net Income (Loss)
(1,912
)
4,434
34,018
83,202
Net Income Attributable to Noncontrolling Interests in Subsidiaries
5
9,120
7,244
25,054
Net Income (Loss) Attributable to SEACOR Holdings Inc.
$
(1,917
)
$
(4,686
)
$
26,774
$
58,148
Basic Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
(0.10
)
$
(0.26
)
$
1.41
$
3.22
Diluted Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
(0.10
)
$
(0.26
)
$
1.38
$
3.04
Weighted Average Common Shares Outstanding:
Basic
19,933,277
18,165,361
18,949,981
18,080,778
Diluted
19,933,277
18,165,361
20,306,332
19,575,689
OIBDA(1)
$
20,013
$
42,760
$
113,726
$
160,578
OIBDA Attributable to SEACOR Holdings Inc.(1)
$
20,013
$
29,822
$
97,727
$
119,753
______________________
Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands, except per share data, unaudited)
Three Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Operating Revenues
$
192,761
$
200,658
$
197,023
$
209,524
$
213,838
Costs and Expenses:
Operating
146,265
147,386
142,871
147,111
150,374
Administrative and general
27,134
24,923
26,714
26,746
26,718
Depreciation and amortization
17,451
16,975
17,009
17,136
17,510
190,850
189,284
186,594
190,993
194,602
Gains on Asset Dispositions, Net
651
1,145
677
437
6,014
Operating Income
2,562
12,519
11,106
18,968
25,250
Other Income (Expense):
Interest income
1,488
2,198
1,885
1,900
2,245
Interest expense
(4,401
)
(4,816
)
(4,903
)
(5,113
)
(6,181
)
Debt extinguishment losses, net
(171
)
(777
)
(503
)
(793
)
(6,017
)
Marketable security gains (losses), net
1,898
144
13,284
3,068
(11,128
)
Foreign currency gains (losses), net
1,351
(1,877
)
(191
)
405
(2,280
)
Other, net
(20
)
505
25
(644
)
13
145
(4,623
)
9,597
(1,177
)
(23,348
)
Income Before Income Tax Expense (Benefit) and Equity in Losses of 50% or Less Owned Companies
2,707
7,896
20,703
17,791
1,902
Income Tax Expense (Benefit)
2,817
1,417
3,390
2,205
(4,519
)
Income (Loss) Before Equity in Losses of 50% or Less Owned Companies
(110
)
6,479
17,313
15,586
6,421
Equity in Losses of 50% or Less Owned Companies, Net of Tax
(1,802
)
(618
)
(312
)
(2,518
)
(1,987
)
Net Income (Loss)
(1,912
)
5,861
17,001
13,068
4,434
Net Income (Loss) attributable to Noncontrolling Interests in Subsidiaries
5
(544
)
2,448
5,335
9,120
Net Income (Loss) attributable to SEACOR Holdings Inc.
$
(1,917
)
$
6,405
$
14,553
$
7,733
$
(4,686
)
Basic Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
(0.10
)
$
0.33
$
0.80
$
0.42
$
(0.26
)
Diluted Earnings (Loss) Per Common Share of SEACOR Holdings Inc.
$
(0.10
)
$
0.32
$
0.76
$
0.41
$
(0.26
)
Weighted Average Common Shares Outstanding:
Basic
19,933
19,322
18,289
18,233
18,165
Diluted
19,933
20,739
19,634
19,571
18,165
Common Shares Outstanding at Period End
20,176
20,179
18,550
18,528
18,330
OIBDA(1)
$
20,013
$
29,494
$
28,115
$
36,104
$
42,760
OIBDA attributable to SEACOR Holdings Inc.(1)
$
20,013
$
28,813
$
21,905
$
26,996
$
29,822
______________________
Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC.
SEGMENT INFORMATION
(in thousands, unaudited)
Three Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Ocean Transportation & Logistics Services
Operating Revenues
$
101,674
$
102,661
$
109,681
$
109,272
$
97,366
Costs and Expenses:
Operating
72,759
66,888
71,230
69,932
64,234
Administrative and general
11,190
9,404
9,423
10,198
10,132
Depreciation and amortization
10,228
10,191
10,230
10,337
10,707
94,177
86,483
90,883
90,467
85,073
Gains on Asset Dispositions, Net
121
804
349
17
5,496
Operating Income
7,618
16,982
19,147
18,822
17,789
Other Income (Expense):
Foreign currency gains (losses), net
52
(104
)
1
(47
)
(17
)
Other, net
6
505
28
(651
)
(15
)
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
(1,238
)
(242
)
700
111
(23
)
Segment Profit(1)
$
6,438
$
17,141
$
19,876
$
18,235
$
17,734
OIBDA(2)
$
17,846
$
27,173
$
29,377
$
29,159
$
28,496
OIBDA(2) attributable to stockholders
$
17,846
$
26,492
$
23,167
$
20,051
$
15,558
Dry-docking expenditures for U.S.-flag petroleum and chemical carriers, dry bulk carriers and PCTC’s (included in operating costs and expenses)
$
8,752
$
4,310
$
1,925
$
1,581
$
6,430
Out-of-service days for dry-dockings of U.S.-flag petroleum and chemical carriers, dry bulk carriers and PCTC’s
76
42
30
15
147
Dry-docking expenditures for all other vessels
$
289
$
1,783
$
1,447
$
1,250
$
269
Inland Transportation & Logistics Services
Operating Revenues
$
68,257
$
72,020
$
61,455
$
65,602
$
77,513
Costs and Expenses:
Operating
57,912
62,775
54,486
54,245
60,801
Administrative and general
3,324
3,327
3,133
3,356
3,381
Depreciation and amortization
6,144
5,694
5,699
5,725
5,490
67,380
71,796
63,318
63,326
69,672
Gains on Asset Dispositions
522
330
330
420
481
Operating Income (Loss)
1,399
554
(1,533
)
2,696
8,322
Other Income (Expense):
Foreign currency gains (losses), net
1,249
(1,729
)
(191
)
459
(2,240
)
Other, net
—
—
—
—
37
Equity in Losses of 50% or Less Owned Companies, Net of Tax
(2,346
)
(1,084
)
(618
)
(2,472
)
(2,571
)
Segment Profit (Loss)(1)
$
302
$
(2,259
)
$
(2,342
)
$
683
$
3,548
OIBDA(2)
$
7,543
$
6,248
$
4,166
$
8,421
$
13,812
SEACOR HOLDINGS INC.
SEGMENT INFORMATION (continued)
(in thousands, unaudited)
Three Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Witt O’Brien’s
Operating Revenues
$
20,742
$
24,345
$
23,753
$
32,943
$
37,702
Costs and Expenses:
Operating
14,266
16,323
15,691
21,772
24,258
Administrative and general
7,008
5,718
6,831
6,402
6,876
Depreciation and amortization
210
210
209
206
660
21,484
22,251
22,731
28,380
31,794
Gains on Asset Dispositions
8
10
—
—
—
Operating Income (Loss)
(734
)
2,104
1,022
4,563
5,908
Other Income (Expense):
Foreign currency losses, net
(1
)
—
—
—
(1
)
Other, net
(457
)
(1
)
(2
)
(3
)
—
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
333
764
(128
)
(67
)
113
Segment Profit (Loss)
$
(859
)
$
2,867
$
892
$
4,493
$
6,020
OIBDA(2)
$
(524
)
$
2,314
$
1,231
$
4,769
$
6,568
Other
Operating Revenues
$
2,099
$
1,635
$
2,142
$
1,805
$
1,290
Costs and Expenses:
Operating
1,335
1,404
1,472
1,253
1,106
Administrative and general
967
846
837
839
551
Depreciation and amortization
499
501
493
489
237
2,801
2,751
2,802
2,581
1,894
Gains (Losses) on Asset Dispositions
—
34
(2
)
—
37
Operating Loss
(702
)
(1,082
)
(662
)
(776
)
(567
)
Other Income (Expense):
Foreign currency losses, net
—
—
—
—
(4
)
Other, net
431
—
—
—
(105
)
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax
1,449
(56
)
(266
)
(90
)
494
Segment Profit (Loss)(1)
$
1,178
$
(1,138
)
$
(928
)
$
(866
)
$
(182
)
Corporate and Eliminations
Operating Revenues
$
(11
)
$
(3
)
$
(8
)
$
(98
)
$
(33
)
Costs and Expenses:
Operating
(7
)
(4
)
(8
)
(91
)
(25
)
Administrative and general
4,645
5,628
6,490
5,951
5,778
Depreciation and amortization
370
379
378
379
416
5,008
6,003
6,860
6,239
6,169
Losses on Asset Dispositions
—
(33
)
—
—
—
Operating Loss
$
(5,019
)
$
(6,039
)
$
(6,868
)
$
(6,337
)
$
(6,202
)
Other Income (Expense):
Foreign currency gains (losses), net
$
51
$
(44
)
$
(1
)
$
(7
)
$
(18
)
Other, net
—
1
(1
)
10
96
______________________
Includes amounts attributable to both SEACOR and noncontrolling interests.
Non-GAAP Financial Measure. See explanation of use of non-GAAP financial measures included elsewhere in this release.
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, unaudited)
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
ASSETS
Current Assets:
Cash and cash equivalents
$
77,222
$
76,815
$
138,757
$
141,152
$
144,221
Restricted cash and restricted cash equivalents
1,222
1,221
1,221
2,992
2,991
Marketable securities
7,936
6,038
39,368
33,384
30,316
Receivables:
Trade, net of allowance for doubtful accounts
194,022
199,013
164,964
174,278
171,828
Other
38,881
43,449
38,297
32,635
38,881
Inventories
5,255
5,224
5,293
4,914
4,530
Prepaid expenses and other
6,971
6,130
5,640
5,809
5,382
Total current assets
331,509
337,890
393,540
395,164
398,149
Property and Equipment:
Historical cost
1,442,382
1,424,907
1,416,084
1,413,488
1,407,329
Accumulated depreciation
(624,024
)
(607,727
)
(593,168
)
(577,136
)
(560,819
)
Net property and equipment
818,358
817,180
822,916
836,352
846,510
Operating Lease Right-of-Use Assets
144,539
153,464
161,518
167,325
—
Investments, at Equity, and Advances to 50% or Less Owned Companies
157,108
154,968
155,645
155,290
156,886
Construction Reserve Funds
—
3,908
3,908
3,908
3,908
Goodwill
32,701
32,668
32,714
32,720
32,708
Intangible Assets, Net
20,996
21,884
22,773
23,662
24,551
Other Assets
7,761
8,284
10,376
7,385
8,312
$
1,512,972
$
1,530,246
$
1,603,390
$
1,621,806
$
1,471,024
LIABILITIES AND EQUITY
Current Liabilities:
Current portion of long-term debt
$
58,854
$
76,426
$
78,301
$
8,308
$
8,497
Current portion of long-term operating lease liabilities
36,011
36,422
36,171
35,540
—
Accounts payable and accrued expenses
57,595
54,921
35,132
50,097
59,607
Other current liabilities
57,501
67,603
64,796
67,456
55,659
Total current liabilities
209,961
235,372
214,400
161,401
123,763
Long-Term Debt
255,612
241,408
234,445
315,303
346,128
Long-Term Operating Lease Liabilities
108,295
116,866
125,182
131,862
—
Deferred Income Taxes
105,661
103,489
99,938
97,758
94,420
Deferred Gains and Other Liabilities
20,929
20,463
20,768
20,688
52,871
Total liabilities
700,458
717,598
694,733
727,012
617,182
Equity:
SEACOR Holdings Inc. stockholders’ equity:
Preferred stock
—
—
—
—
—
Common stock
408
408
392
392
390
Additional paid-in capital
1,661,002
1,659,428
1,600,838
1,598,804
1,596,642
Retained earnings
517,106
519,023
512,618
498,065
474,809
Shares held in treasury, at cost
(1,365,792
)
(1,365,594
)
(1,366,432
)
(1,366,267
)
(1,366,773
)
Accumulated other comprehensive loss, net of tax
(998
)
(1,400
)
(995
)
(903
)
(914
)
811,726
811,865
746,421
730,091
704,154
Noncontrolling interests in subsidiaries
788
783
162,236
164,703
149,688
Total equity
812,514
812,648
908,657
894,794
853,842
$
1,512,972
$
1,530,246
$
1,603,390
$
1,621,806
$
1,471,024
Use of non-GAAP Financial Measures
The information furnished in this release includes non-GAAP financial measures that differ from measures calculated in accordance with U.S. GAAP, including OIBDA and Cash Earnings.
The Company defines OIBDA as operating income (loss) plus depreciation and amortization. The Company includes maintenance and repair costs, including major overhauls and regulatory dry-dockings, and gains or losses (or impairments) on asset dispositions in OIBDA. The Company defines Cash Earnings as OIBDA further adjusted to exclude the amortization of non-cash deferred gains and amounts attributable to its minority partner in SEA-Vista as well as the gain or loss associated with marking-to-market securities held for investment, accrued net cash expense associated with interest on debt obligations, and the Company’s estimate of cash taxes. Other companies may calculate OIBDA and Cash Earnings differently than the Company, which may limit their usefulness as comparative measures. In addition, each of these measures does not necessarily represent funds available for discretionary use and are not measures of the Company’s ability to fund its cash needs. OIBDA and Cash Earnings are each financial metrics used by management (i) as a supplemental internal measure for planning and forecasting overall expectations and for evaluating actual results against such expectations; (ii) as a criteria for annual incentive bonuses paid to Company officers and other shore-based employees; and (iii) to compare to the OIBDA and Cash Earnings of other companies when evaluating potential acquisitions. In addition, the Company believes Cash Earnings is meaningful to investors because it assists in evaluating the Company’s results of operations and net cash generated by business activities across previous and subsequent accounting periods and to better understand the long-term performance of the Company. The Company views OIBDA and Cash Earnings as measures of operating performance not liquidity.
The presentation of these non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.
The following tables reconcile these non-GAAP measures to their most closely comparable U.S. GAAP measures (amounts in thousands, except per share data).
Three Months Ended December 31,
Twelve Months Ended December 31,
2019
2018
2019
2018
U.S. GAAP Measures
Net Income (Loss) Attributable to Stockholders
$
(1,917
)
$
(4,686
)
$
26,774
$
58,148
Diluted Earnings (Loss) Per Common Share(1)
$
(0.10
)
$
(0.26
)
$
1.38
$
3.04
Reconciliation of non-GAAP Financial Measures
Operating Income (U.S. GAAP)
$
2,562
$
25,250
$
45,155
$
85,999
(+) Depreciation and amortization
17,451
17,510
68,571
74,579
OIBDA(2)
20,013
42,760
113,726
160,578
(–) Amortization of deferred gains(3)
(330
)
(9,759
)
(1,322
)
(25,737
)
(–) OIBDA less amortization of deferred gains attributable to noncontrolling interests
—
(8,593
)
(15,999
)
(30,292
)
(–) Cash interest paid, net(4)
(1,459
)
(1,581
)
(4,220
)
(15,408
)
(–) Income tax obligation
(6
)
(1,068
)
(25
)
(18,915
)
(+/–) Marketable security gains (losses), net
1,898
(11,128
)
18,394
(12,431
)
Cash Earnings
20,116
10,631
110,554
57,795
(–) Make-whole premium to redeem the 7.375% notes
—
—
—
(5,601
)
(+) Return from sale of Hawker Pacific Airservices, Limited(5)
—
—
—
51,000
Proxy for cash earned
$
20,116
$
10,631
$
110,554
$
103,194
______________________
Includes diluted earnings (loss) per common share of $0.08 and $(0.48) for the quarter ended December 31, 2019 and 2018, respectively, related to marking-to-market the Company’s marketable security portfolio. Includes diluted earnings (loss) per common share of $0.72 and $(0.50) for the twelve months ended December 31, 2019 and 2018, respectively, related to marking-to-market the Company’s marketable security portfolio.
All references to OIBDA in this release are calculated in the same manner.
For the three and twelve months ended December 31, 2019, amortization of deferred gains is included in gains on asset dispositions. For the three and twelve months ended December 31, 2018, amortization of deferred gains may be included in operating expenses as a reduction to rental expense and/or included in gains on asset dispositions.
Amount is net of interest income, excludes capitalized interest, and is net of our partner’s portion of SEA-Vista net interest expense of $0.6 million for the three months ended December 31, 2018 and $1.2 million and $2.7 million for the twelve months ended December 31, 2019 and 2018, respectively.
Cash profit from the sale of the Company's 34.2% interest in Hawker Pacific Airservices, Limited in April 2018.
