SUBSCRIBE TO TMCnet
TMCnet - World's Largest Communications and Technology Community

TMC NEWS

TMCNET eNEWSLETTER SIGNUP

Mitcham Industries Reports Fiscal 2019 First Quarter Results
[June 06, 2018]

Mitcham Industries Reports Fiscal 2019 First Quarter Results


HUNTSVILLE, Texas, June 6, 2018 /PRNewswire/ -- Mitcham Industries, Inc. (NASDAQ: MIND) ("Mitcham" or "the Company") today announced financial results for its fiscal 2019 first quarter ended April 30, 2018.

Total revenues for the first quarter of fiscal 2019 were $7.6 million compared to $18.4 million in the first quarter of fiscal 2018, largely driven by a decline in the sale of lease pool equipment and delays in orders for marine technology products.  The Company had sold $8.8 million of lease pool equipment during the first quarter of fiscal 2018. Revenues from the Marine Technology Products segment fell to $3.6 million in the first quarter, compared to $6.9 million in the same period last year.  While Seamap sales declined mainly due to delays in expected incoming orders, Klein sales increased 61% compared to the same period last year. Equipment Leasing revenues were $2.7 million in the first quarter, flat compared to the same period last year.

The Company reported a net loss attributable to common shareholders of $6.3 million, or $(0.52) per share, in the first quarter of fiscal 2019 compared to a net loss of $2.9 million, or $(0.24) per share, in the first quarter of fiscal 2018. 

Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, stock-based compensation, non-cash costs of lease pool equipment sales and non-cash foreign exchange gains and losses) for the first quarter of fiscal 2019 was a loss of approximately $1.5 million compared to a gain of approximately $9.0 million in the same period last year. Adjusted EBITDA, which is not a measure determined in accordance with United States generally accepted accounting principles ("GAAP"), is defined and reconciled to reported net loss and cash provided by operating activities in the accompanying financial tables.

Rob Capps, Mitcham's Co-Chief Executive Officer, stated, "Despite a lackluster first quarter, our Marine Technology Products segment has recently been experiencing an increase in order activity, a good indicator that the marine markets are finally starting to show some improvement. As we disclosed on May 30th, Mitcham has recently booked orders totaling approximately $6.0 million for Klein's sonar and related products.  In addition, Mitcham's Seamap unit has also received orders totaling approximately $6.1 million for seismic source controllers, RGPS positioning systems and related items.  Seamap has also received orders totaling approximately $1.0 million related to its recently-introduced towed streamer products. These orders combined with an increased level of inquiries from current and potential new customers, should result in a much stronger second-half of fiscal 2019. In addition, Mitcham's capital structure continues to remain strong with no debt on our balance sheet and ample liquidity, including cash and cash equivalents of $8.6 million as of April 30, 2018.

"Eighteen months ago, we embarked on a strategic re-positioning to become a significant provider of technology to broader marine applications. We are very pleased that this endeavor is beginning to pay dividends. The solid streamer and sensor technology that we acquired earlier this year has extensive application in the oceanographic and hydrographic industries and provides clear opportunities to integrate this technology into new markets for us in areas such as anti-submarine warfare and maritime security systems. Furthermore, our previously announced rental partnerships with INOVA and Lanfang Dynamic Technologies provide Mitcham with increased flexibility and a lower cost structure in delivering state-of-the-art technology to our land seismic leasing equipment customers."

FISCAL 2019 FIRST QUARTER RESULTS

Total revenues for the first quarter of fiscal 2019 decreased to $7.6 million driven mainly by a delay in marine technology products sales and a large decrease in lease pool equipment sales compared to last year's fiscal first quarter. Marine technology products sales decreased 46% year-over-year, while equipment leasing revenues, excluding lease pool equipment sales, were flat year-over-year.

Marine technology products sales decreased to $3.7 million in the first quarter of fiscal 2019 compared to $6.9 million in last year's first quarter mainly due to a decline in Seamap sales.  However, through May 31, 2018, Seamap has now received orders for seismic source controllers, positioning systems and related equipment totaling approximately $6.1 million. Furthermore, this segment has recently received orders of approximately $1.0 million for the recently introduced SeaLink streamer product line. Klein sales increased 61% during the first quarter compared to last year's first quarter. The first quarter sales consisted of approximately $1.8 million of Seamap, $1.5 million from Klein (including $36,000 of intra-segment sales) and $0.5 million by SAP.

Equipment leasing revenues for the first quarter of fiscal 2019, excluding lease pool equipment sales, were $2.7 million flat compared to the same period last year.  Lease pool equipment sales were $1.2 million in the first quarter of fiscal 2019, compared to $8.8 million in the first quarter a year ago. 

Lease pool depreciation expense in the first quarter of fiscal 2019 decreased to $2.7 million from $4.2 million in the same period a year ago, due to a combination of lower lease pool purchases and increased lease pool sales over the past year.   

Selling, general and administrative expenses increased to $5.6 million in the first quarter of fiscal 2019 versus $4.8 million in the first quarter of fiscal 2018, due primarily to approximately $400,000 in incremental expenses related to the transfer of the acquired technology and the set-up of related production and repair facilities in Asia.  The lower sales by Seamap in the first quarter of fiscal 2019 also resulted in an increase in unabsorbed overhead costs which affected general and administrative expenses.

CONFERENCE CALL

We have scheduled a conference call for Thursday, June 7 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time) to discuss our fiscal 2019 first quarter results.  To access the call, please dial (412) 902-0030 and ask for the Mitcham Industries call at least 10 minutes prior to the start time.  Investors may also listen to the conference live on the Mitcham Industries corporate website, http://www.mitchamindustries.com, by logging onto the site and clicking "Investor Relations." A telephonic replay of the conference call will be available through June 14, 2018 and may be accessed by calling (201) 612-7415 and using passcode 13680079#. A webcast archive will also be available at http://www.mitchamindustries.com shortly after the call and will be accessible for approximately 90 days.   For more information, please contact Donna Washburn at Dennard Lascar Investor Relations (713) 529-6600 or email dwashburn@dennardlascar.com.

About Mitcham Industries

Mitcham Industries, Inc. provides technology to the oceanographic, hydrographic, defense, seismic and security industries.  Headquartered in Huntsville, Texas, Mitcham has a global presence with operating locations in the United States, Canada, Australia, Singapore, Russia, Hungary, Colombia and the United Kingdom. Mitcham's worldwide Marine Technology Products segment, which includes its Seamap and Klein Marine Systems units, designs, manufactures and sells specialized, high performance, marine sonar and seismic equipment. Through its Equipment Leasing segment, Mitcham believes it is the largest independent provider of exploration equipment to the seismic industry.

Certain statements and information in this press release concerning results for the quarter ended April 30, 2018 may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.  The words "believe," "expect," "anticipate," "plan," "intend," "should," "would," "could" or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature.  These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us.  While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate.  All comments concerning our expectations for future revenues and operating results are based on our forecasts of our existing operations and do not include the potential impact of any future acquisitions.  Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof.  We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.

Tables to Follow

 





MITCHAM INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)



April 30, 2018


January 31, 2018

ASSETS

Current assets:




Cash and cash equivalents

$

8,613



$

9,902


Restricted cash

233



244


Accounts and contracts receivable, net of allowance for doubtful accounts of $3,560 and $3,885 at April 30, 2018 and January 31, 2018, respectively

12,333



10,494


Inventories, net

11,432



10,856


Prepaid expenses and other current assets

2,132



1,550


Total current assets

34,743



33,046


Seismic equipment lease pool and property and equipment, net

21,046



22,900


Intangible assets, net

11,484



8,015


Goodwill

2,531



2,531


Non-current prepaid income taxes

1,603



1,609


Long-term receivables, net of allowance for doubtful accounts of $94 and $2,282 at April 30, 2018 and January 31, 2018, respectively

706



4,652


Other assets

611



926


Total assets

$

72,724



$

73,679


LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:




Accounts payable

$

2,889



$

1,271


Deferred revenue

723



741


Accrued expenses and other current liabilities

4,895



5,253


Income taxes payable

896



258


Total current liabilities

9,403



7,523


Deferred tax liability

105



307


Total liabilities

9,508



7,830


Shareholders' equity:




Preferred stock, $1.00 par value; 1,000 shares authorized; 698 and 532 issued and outstanding at April 30, 2018, and January 31, 2018, respectively

15,312



11,544


Common stock $.01 par value; 20,000 shares authorized; 14,019 shares issued at April 30, 2018 and January 31, 2018

140



140


Additional paid-in capital

122,430



122,304


Treasury stock, at cost (1,929 at April 30, 2018 and January 31, 2018)

(16,860)



(16,860)


Accumulated deficit

(48,715)



(42,425)


Accumulated other comprehensive loss

(9,091)



(8,854)


Total shareholders' equity

63,216



65,849


Total liabilities and shareholders' equity

$

72,724



$

73,679



 

MITCHAM INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)




For the Three Months Ended April 30,



2018


2017

Revenues:





Sale of marine technology products


$

3,566



$

6,888


Equipment leasing


2,697



2,717


Sale of lease pool equipment


1,350



8,828


Total revenues


7,613



18,433


Cost of sales:





Sale of marine technology products


2,086



3,975


Equipment leasing (including lease pool depreciation)


3,582



5,125


Lease pool equipment sales


700



6,139


Total cost of sales


6,368



15,239


Gross profit


1,245



3,194


Operating expenses:





Selling, general and administrative


5,630



4,804


Research and development


370



98


Provision for doubtful accounts


200




Depreciation and amortization


617



581


Total operating expenses


6,817



5,483


Operating loss


(5,572)



(2,289)


Other income (expense):





Interest, net


18



(46)


Other, net


86



(101)


Total other income (expense)


104



(147)


Loss before income taxes


(5,468)



(2,436)


Provision for income taxes


(437)



(229)


Net loss


$

(5,905)



$

(2,665)


Preferred stock dividends


(385)



(194)


Net loss attributable to common shareholders


$

(6,290)



$

(2,859)


Net loss per common share:





Basic


$

(0.52)



$

(0.24)


Diluted


$

(0.52)



$

(0.24)


Shares used in computing loss per common share:





Basic


12,087



12,078


Diluted


12,087



12,078


 

MITCHAM INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)



For the Three Months
Ended April 30,


2018


2017

Cash flows from operating activities:




Net loss

$

(5,905)



$

(2,665)


Adjustments to reconcile net loss to net cash provided by operating activities:




Depreciation and amortization

3,303



4,791


Stock-based compensation

126



224


Provision for doubtful accounts, net of charge offs

(200)




Provision for inventory obsolescence



8


Gross profit from sale of lease pool equipment

(536)



(2,689)


Deferred tax benefit

(202)



(27)


Changes in working capital items:




Trade accounts and contracts receivable

2,418



2,175


Unbilled revenue

(930)




Inventories

(844)



(1,403)


Prepaid expenses and other current assets

(1,520)



549


Income taxes payable

642



149


Accounts payable, accrued expenses and other current liabilities

(47)



48


Deferred revenue

313




Foreign exchange losses net of gains

16



(48)


Net cash (used in) provided by operating activities

(3,366)



1,112


Cash flows from investing activities:




Purchases of seismic equipment held for lease

(190)



(158)


Acquisition of assets

(3,000)




Purchases of property and equipment

(113)



(28)


Sales of used lease pool equipment

1,620



4,496


Net cash (used in) provided by investing activities

(1,683)



4,310


Cash flows from financing activities:




Net payments on revolving line of credit



(3,500)


Payments on term loan and other borrowings



(2,807)


Net proceeds from preferred stock offering

3,812



27


Preferred stock dividends

(385)



(194)


Net cash provided by (used in) financing activities

3,427



(6,474)


Effect of changes in foreign exchange rates on cash, cash equivalents and restricted cash

322



(3)


Net change in cash, cash equivalents and restricted cash

(1,300)



(1,055)


Cash, cash equivalents and restricted cash, beginning of period

10,146



3,511


Cash, cash equivalents and restricted cash, end of period

$

8,846



$

2,456


 

MITCHAM INDUSTRIES, INC.

Reconciliation of Net Loss and Net Cash Provided by Operating Activities to EBITDA and

Adjusted EBITDA

(unaudited)



For the Three Months Ended
April 30,


2018


2017


(in thousands)

Reconciliation of Net loss to EBITDA and Adjusted EBITDA




Net loss

$

(5,905)



$

(2,665)


Interest (income) expense, net

(18)



46


Depreciation and amortization

3,303



4,791


Provision for income taxes

437



229


EBITDA (1)

(2,183)



2,401


Non-cash foreign exchange (gains) losses

(49)



194


Stock-based compensation

126



224


Cost of lease pool sales

627



6,139


Adjusted EBITDA (1)

$

(1,479)



$

8,958


Reconciliation of Net cash provided by operating activities to EBITDA




Net cash (used in) provided by operating activities

$

(3,366)



$

1,112


Stock-based compensation

(126)



(224)


Provision for doubtful accounts

(200)




Provision for inventory obsolescence



(8)


Changes in trade accounts, contracts and notes receivable

(1,488)



(2,175)


Interest paid

1



92


Taxes paid, net of refunds

46



13


Gross profit from sale of lease pool equipment

536



2,689


Changes in inventory

844



1,403


Changes in accounts payable, accrued expenses and other current liabilities and deferred revenue

(266)



(48)


Changes in prepaid expenses and other current assets

1,520



(549)


Foreign exchange (losses) gains

(16)



48


Other

332



48


EBITDA (1)

$

(2,183)



$

2,401




(1)

EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation and amortization. Adjusted EBITDA excludes non-cash foreign exchange gains and losses, non-cash costs of lease pool equipment sales, certain non-recurring contract settlement costs and stock-based compensation. We consider EBITDA and Adjusted EBITDA to be important indicators for the performance of our business, but not measures of performance or liquidity calculated in accordance with accounting principles generally accepted in the United States of America ("GAAP"). We have included these non-GAAP financial measures because management utilizes this information for assessing our performance and liquidity, and as indicators of our ability to make capital expenditures and finance working capital requirements. We believe that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us. In particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities.  We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or as alternatives to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP. In evaluating our performance as measured by EBITDA, management recognizes and considers the limitations of this measurement. EBITDA and Adjusted EBITDA do not reflect our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures. Accordingly, EBITDA and Adjusted EBITDA are only two of the measurements that management utilizes.   Other companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies. 

 

Mitcham Industries, Inc.

Segment Operating Results

(in thousands)

(unaudited)




For the Three Months Ended
April 30,



2018


2017



(in thousands)

Revenues:





Sale of marine technology products


$

3,708



$

6,911


Equipment leasing


4,047



11,545


Inter-segment sales


(142)



(23)


Total revenues


7,613



18,433


Cost of sales:





Marine technology products


2,228



3,998


Equipment leasing


4,282



11,264


Inter-segment costs


(142)



(23)


Total cost of sales


6,368



15,239


Gross profit


1,245



3,194


Operating expenses:





Selling, general and administrative


5,630



4,804


Research and development


370



98


Provision for doubtful accounts


200




Depreciation and amortization


617



581


Total operating expenses


6,817



5,483


Operating loss


$

(5,572)



$

(2,289)


Marine Technology Products Segment:





Revenues:





Seamap


$

1,752



$

4,886


Klein


1,512



938


SAP


480



1,290


Intra-segment sales


(36)



(203)




3,708



6,911


Cost of sales:





Seamap


844



2,561


Klein


1,036



732


SAP


398



1,017


Intra-segment sales


(50)



(312)




2,228



3,998


Gross profit


$

1,480



$

2,913


Gross profit margin


40

%


42

%

Equipment Leasing Segment:





Revenue:



Equipment leasing


$

2,697



$

2,717


Lease pool equipment sales


1,163



8,828


Other equipment sales


187






4,047



11,545


Cost of sales:



Direct costs-equipment leasing


928



944


Lease pool depreciation


2,654



4,181


Cost of lease pool equipment sales


627



6,139


Cost of other equipment sales


73






4,282



11,264


Gross (loss) profit


$

(235)



$

281


Gross (loss) profit margin


(6)

%


2

%

 

Contacts:

Rob Capps, Co-CEO


Mitcham Industries, Inc.


936-291-2277




Jack Lascar / Mark Roberson


Dennard Lascar Investor Relations


713-529-6600

 

Cision View original content:http://www.prnewswire.com/news-releases/mitcham-industries-reports-fiscal-2019-first-quarter-results-300661067.html

SOURCE Mitcham Industries, Inc.


[ Back To TMCnet.com's Homepage ]







Technology Marketing Corporation

35 Nutmeg Drive Suite 340, Trumbull, Connecticut 06611 USA
Ph: 800-243-6002, 203-852-6800
Fx: 203-866-3326

General comments: tmc@tmcnet.com.
Comments about this site: webmaster@tmcnet.com.

STAY CURRENT YOUR WAY

© 2018 Technology Marketing Corporation. All rights reserved | Privacy Policy