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):
August 8, 2003 (August 8, 2003)
___________________
TORCH OFFSHORE, INC.
(Exact Name of Registrant as Specified in its Charter)
000-32855
(Commission File Number)
Delaware 74-2982117
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
401 Whitney Avenue, Suite 400
Gretna, Louisiana 70056-2596
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code:
(504) 367-7030
ITEM 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL
INFORMATION AND EXHIBITS.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
The following exhibits are filed herewith:
Exhibit No. Description
----------- -----------
99.1 Torch Offshore, Inc. Press Release, dated
August 8, 2003.
ITEM 12. RESULT OF OPERATIONS AND FINANCIAL CONDITION.
On August 8, 2003, Torch Offshore, Inc. (the "Company")
issued a press release announcing operating results for the
quarter ended June 30, 2003. A copy of this press release is
furnished as Exhibit 99.1 to this report and incorporated
by reference herein.
The Company has presented its EBITDA for the three- and six-
month period ended June 30, 2003 in the press release, which
is a "non-GAAP" financial measure under Regulation G. The
components of EBITDA are computed by using amounts, which
are determined in accordance with GAAP. As part of our press
release information, we have provided a reconciliation of
EBITDA to net income (loss) attributable to common
stockholders, which is its nearest comparable GAAP financial
measure. However, because EBITDA is not based on any
standardized methodology prescribed by GAAP, it is not
necessarily comparable to similar measures presented by
other companies. The Company included EBITDA in the press
release because it believes that it uses this measure as an
internal benchmark against certain performance objectives
and to provide investors and creditors additional
information in assessing the Company's business in
comparison to industry and other market competitive
standards.
SIGNATURE
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.
TORCH OFFSHORE, INC.
By: /s/ ROBERT E. FULTON
Date: August 8, 2003 ------------------------
Robert E. Fulton
Chief Financial Officer
INDEX TO EXHIBITS
Exhibit No. Description
----------- -----------
99.1 Torch Offshore, Inc. Press Release, dated
August 8, 2003.
EXHIBIT 99.1
NEWS RELEASE
For immediate release to:
Analysts, Financial Community, Media
Contact: Bob Fulton (1)504-367-7030 b.fulton@torchinc.com
Bradley Lowe(1)504-367-7030 b.lowe@torchinc.com
Torch Offshore Announces 2003 Second Quarter Results
New Orleans, Louisiana USA, August 8, 2003
SECOND QUARTER RESULTS
Torch Offshore, Inc. (NASDAQ: TORC) (the "Company")
announced today that revenues for the quarter ended June 30,
2003 were $13.9 million, an increase of 7.5 percent compared
to revenues of $12.9 million for the second quarter of 2002.
Gross profit (revenues less cost of sales) for the second
quarter of 2003 was $1.4 million or 9.9 percent of revenues
compared to the second quarter 2002 gross profit of $2.2
million or 17.1 percent of revenues. Our second quarter 2003
gross profit was adversely impacted by a $0.7 million ($0.4
million after tax effect, or $0.03 per diluted share) charge
to cost of sales resulting from additional costs incurred
relating to the termination of the Midnight Hunter charter.
The second quarter 2003 net loss attributable to
stockholders was $1.2 million, or $0.09 per diluted share,
compared to the net loss attributable to stockholders in the
second quarter of 2002 which was $0.4 million, or $0.03 per
diluted share.
Lyle G. Stockstill, Torch Offshore, Inc. Chairman and Chief
Executive Officer, commented, "The competition in the
shallow water Gulf of Mexico market during the second
quarter of 2003 was extremely intense, resulting in
depressed pricing and a lower gross profit for the Company.
Although the utilization of our fleet remained relatively
stable as compared to traditional second quarter activity,
the pricing structure was simply not there for shallow water
pipelay work."
"As for the future of Torch Offshore, we continue to work
towards our goal of entering the deepwater markets of the
world and providing state of the art vessels and opportunity
to our customers. During the second quarter, we completed
the necessary modifications to the Midnight Wrangler,
including the addition of cranes, and it has gone out and
successfully completed its first job in the past few days.
In addition, the conversion of the Midnight Express, a 520-
foot dynamically positioned (DP-2) offshore construction
vessel equipped with our patented pipelay system, continues
to progress and should be completed in time for the vessel
to enter our active fleet in the first half of 2004."
FIRST HALF RESULTS
For the first half of 2003, revenues increased 4.3 percent
to $30.9 million generating a gross profit of $4.7 million
or 15.1 percent of revenues, compared to year-ago period
revenues of $29.6 million that produced a gross profit of
$6.2 million or 20.9 percent of revenues. Included in cost
of sales in the first six months of 2003 was $1.3 million
($0.9 million after tax effect, or $0.07 per diluted share)
of costs related to the termination of the Midnight Hunter
charter. The net loss attributable to stockholders for the
first six months of 2003 totaled $1.1 million, or $0.09 per
diluted share, compared to the net income attributable to
stockholders in the first six months of 2002 which was $0.1
million, or $0.01 per diluted share.
CONFERENCE CALL
A conference call will be held at 10:00 a.m. Central Time on
Friday, August 8, 2003. To participate by telephone, United
States callers can dial (800) 901-5226 and international
callers can dial (617) 786-4513 ten to fifteen minutes prior
to the starting time. The conference ID for all callers is
88664617. The conference call will also be webcast live on
the Internet through the Investor Relations page on the
Company's web site, www.torchinc.com.
The call will be available for replay beginning at 1:00 p.m.
(Central Time) on August 8, 2003 and ending at midnight
(Central Time) on Thursday, August 14, 2003. For callers in
the United States, the toll-free number for the replay is
(888) 286-8010. For international callers, the number is
(617) 801-6888. The conference ID for all callers for the
replay is 37855044. All individuals listening to the
conference call or the replay are reminded that all
conference call material is copyrighted by Torch Offshore,
Inc. and cannot be recorded or rebroadcast without Torch
Offshore, Inc.'s express written consent.
Established in 1978, Torch Offshore, Inc. is involved in
offshore pipeline installation and subsea construction for
the oil and natural gas industry. Torch Offshore, Inc. is
expanding beyond its established shallow water niche market
in order to serve the industry's worldwide growing needs in
the deep waters.
Any statements made in this news release, other than those
of historical fact, about an action, event or development,
which the Company hopes, expects, believes or anticipates
may or will occur in the future, are forward-looking
statements under the Private Securities Litigation Act of
1995. The forward-looking statements in this news release
include statements about our deepwater operations, the
modification and/or conversion timing and cost of the
Midnight Express and the capabilities of the Company's
vessels. Such statements are subject to various assumptions,
risks and uncertainties, which are specifically described in
the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2002 filed with the Securities and
Exchange Commission, as well as other factors that may not
be within the Company's control, including, specifically,
oil and natural gas commodity prices, weather conditions and
offshore construction activity levels. Although the Company
believes its expectations are based on reasonable
assumptions, it gives no assurance that the Company's
assumptions and projections will prove to be correct. Actual
results may differ materially from those projected.
PR 03-013
# # #
TORCH OFFSHORE, INC.
Statements of Operations (Unaudited)
(in thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
-------------- --------------
2003 2002 2003 2002
------ ------ ------ ------
Revenues $13,876 $12,910 $30,905 $29,635
Cost of revenues:
Cost of sales 12,500 10,707 26,245 23,453
Depreciation and
amortization 1,822 1,861 3,649 3,791
General and
administrative expenses 1,348 1,021 2,703 2,271
------ ------ ------ ------
Total cost of revenues 15,670 13,589 32,597 29,515
------ ------ ------ ------
Operating income (loss) (1,794) (679) (1,692) 120
------ ------ ------ ------
Other income (expense):
Interest expense - (20) - (55)
Interest income - 62 - 164
------ ------ ------ ------
Total other income - 42 1 109
------ ------ ------ ------
Income (loss) before
income taxes (1,794) (637) (1,691) 229
Income tax (expense)
benefit 628 223 592 (80)
------ ------ ------ ------
Net income (loss)
attributable to common
stockholders $(1,166)$ (414) $(1,099) $ 149
====== ====== ====== ======
Net income (loss) per
common share:
Basic $ (0.09)$ (0.03) $ (0.09) $ 0.01
====== ====== ====== ======
Diluted $ (0.09)$ (0.03) $ (0.09) $ 0.01
====== ====== ====== ======
Weighted average common
stock outstanding:
Basic 12,636 12,723 12,636 12,788
====== ====== ====== ======
Diluted 12,653 12,723 12,645 12,788
====== ====== ====== ======
Other data:
EBITDA (A), (B) $ 28 $ 1,182 $ 1,957 $ 3,911
====== ====== ====== ======
(A) The Company calculates EBITDA as earnings before net
interest, income taxes, depreciation and amortization.
Please see Condensed Balance Sheet and Other Information
included in this News Release for a reconciliation of
EBITDA to net income (loss) attributable to common
stockholders. EBITDA is presented here to provide
additional information about our operations. EBITDA is
not a calculation based on generally accepted accounting
principles (GAAP) and should not be considered as an
alternative to net income, as an indicator of our
operating performance or as an alternative to cash flow
as a better measure of liquidity. In addition, our EBITDA
calculation may not be comparable to similarly titled
measures of other companies.
TORCH OFFSHORE, INC.
Condensed Balance Sheet and Other Information (Unaudited)
(in thousands, except per share data)
June 30, December 31,
2003 2002
------------ ------------
Assets
Current assets $ 21,765 $ 31,373
Property, net 111,815 67,561
Other assets 3,185 2,970
------------ ------------
Total assets $136,765 $101,904
============ ============
Liabilities and
Stockholders' Equity
Accounts payable - trade $ 9,156 $ 7,677
Accrued expenses and other 3,815 7,393
Midnight Express
Finance Facility 19,630 -
Current portion of long-
term debt 2,780 14
Receivable line of credit 4,868 4,271
------------ ------------
Total current
liabilities 40,249 19,355
Deferred income taxes 2,044 2,636
Long-term debt, less
current portion 15,680 46
Stockholders' equity 78,792 79,867
------------ ------------
Total liabilities and
stockholders' equity $136,765 $101,904
============ ============
Three Months Six Months
Ended June 30, Ended June 30,
-------------- --------------
2003 2002 2003 2002
----- ----- ----- -----
EBITDA Reconciliation(B):
Net income (loss)
attributable to common
stockholders $(1,166)$ (414) $(1,099)$ 149
Income tax expense
(benefit) (628) (223) (592) 80
Other income - (42) (1) (109)
Depreciation and
amortization 1,822 1,861 3,649 3,791
----- ----- ----- -----
EBITDA $ 28 $1,182 $ 1,957 $3,911
===== ===== ===== =====
(B) We have disclosed EBITDA, a non-GAAP measure
determined as described in item (A) above, because
we use this measure as an internal benchmark against
certain performance objectives and to provide
investors and creditors additional information in
assessing our business in comparison to industry
and other market competitive standards.