Tidewater Reports Fourth Quarter and Year End Results For Fiscal 2016 - Tidewater (NYSE:TDW)

NEW ORLEANS, May 25, 2016 /PRNewswire/ -- Tidewater Inc. TDW announced today a fourth quarter net loss for the period ended March 31, 2016, of $81.8 million, or $1.74 per common share, on revenues of $184.2 million. For fiscal year ended March 31, 2016, the company's net loss was $160.2 million, or $3.41 per common share, on revenues of $979.1 million. For the prior fiscal year's fourth quarter ended March 31, 2015, the company's net loss was $9.1 million, or $0.19 per common share, on revenues of $324.8 million. For fiscal year ended March 31, 2015, the company's net loss was $65.2 million, or $1.34 per common share, on revenues of $1,495.5 million. During fiscal years ended March 31, 2016 and 2015, the company generated net cash from operating activities of $253.4 million and $358.7 million, respectively, and used net cash in investing activities of $135.0 million and $231.4 million, respectively.

Included in the net loss for the quarter ended March 31, 2016 were the following:

$55.5 million ($40.7 million after-tax, or $0.87 per share) in non-cash asset impairment charges that resulted from impairment reviews undertaken during the March 2016 quarter.
$8.7 million ($8.7 million after-tax, or $0.18 per share) of foreign exchange losses which is included in Equity in net earnings (losses) of unconsolidated companies and related to our Angola joint venture, Sonatide.

Included in the net loss for the fiscal year ended March 31, 2016 were the following:

$117.3 million ($98.6 million after-tax, or $2.10 per share) in non-cash asset impairment charges that resulted from impairment reviews undertaken throughout fiscal 2016.
$24.1 million ($24.1 million after-tax, or $0.51 per share) of foreign exchange losses which is included in Equity in net earnings (losses) of unconsolidated companies and related to our Angola joint venture, Sonatide.
A $7.6 million ($6.3 million after-tax, or $0.13 per share) restructuring charge related to severance and other termination costs resulting from right-sizing efforts during the September 2015 quarter.

Income tax expense in each of the fiscal 2016 quarters largely reflect tax liabilities in certain jurisdictions that levy taxes on bases other than pre-tax profitability (so called "deemed profit" regimes.)

Included in the net loss for the prior fiscal year's quarter ended March 31, 2015 were the following:

$6.4 million ($5.1 million after-tax, or $0.11 per share) in non-cash asset impairment charges that resulted from stacked vessel and other asset impairment reviews undertaken during the March 2015 quarter.
A $4.1 million ($3.3 million after-tax, or $0.07 per share) restructuring charge related to severance and other termination costs resulting from right-sizing efforts during the March 2015 quarter.
A $23.8 million ($23.8 million after-tax, or $0.51 per share) non-cash adjustment in the March 2015 quarter related to the valuation of deferred tax assets.

Included in the net loss for the prior fiscal year ended March 31, 2015 were the following:

A $283.7 million ($214.9 million after-tax, or $4.42 per share) non-cash goodwill impairment charge resulting from the company's annual goodwill impairment assessment undertaken during the December 2014 quarter.
$14.5 million ($12.0 million after-tax, or $0.25 per share) in non-cash asset impairment charges that resulted from impairment reviews undertaken throughout fiscal 2015.
A $4.1 million ($3.3 million after-tax, or $0.07 per share) restructuring charge related to severance and other termination costs resulting from right-sizing efforts during the March 2015 quarter.
A $23.8 million ($23.8 million after-tax, or $0.49 per share) non-cash adjustment in the March 2015 quarter related to the valuation of deferred tax assets.

Status of Discussions with Lenders and Noteholders/Audit Opinion

At March 31, 2016, the company was in compliance with all financial covenants set forth in its debt facilities and note indentures; however, we are forecasting that, as early as the quarter ending June 30, 2016, the company may no longer be in compliance with the 3.0x minimum interest coverage ratio requirement contained in its Revolving Credit and Term Loan Agreement ("Bank Loan Agreement"), the Troms Offshore Debt and the 2013 Senior Note Agreement (the "2013 Note Agreement"). In the event of a covenant violation, which could occur as early as mid-August 2016 (when we are required to certify that the interest coverage ratio has been met for the first fiscal quarter ending June 30, 2016), the lenders and/or the noteholders could declare the company to be in default of the Bank Loan Agreement, the Troms Offshore Debt or the 2013 Note Agreement, as applicable, and accelerate the indebtedness thereunder, the effect of which would be to likewise cause the company's other Senior Notes, which were issued in 2010 and 2011, to be in default.

Given that we expect that during fiscal 2017 we will not meet the 3.0x minimum interest coverage ratio requirement set forth in the Bank Loan Agreement, the Troms Offshore Debt and the 2013 Note Agreement, which could result in the acceleration of the debt under these agreements and the company's other Senior Notes, we expect the report of the company's independent registered public accounting firm that accompanies our audited consolidated financial statements for the fiscal year ended March 31, 2016 (the "audit opinion") will contain an explanatory paragraph regarding our ability to continue as a going concern. Such going concern explanatory paragraph is required only because our internal forecast indicates that, within fiscal 2017, we may no longer be in compliance with the minimum interest coverage ratio requirement.

In addition, the Bank Loan Agreement and the Troms Offshore Debt require that the company receive an unqualified audit opinion from an independent certified public accountant which shall not be subject to a going concern or similar modification. The failure to receive an audit opinion without any modification, in and of itself, is an event of default under these agreements which would allow the lenders to accelerate the indebtedness thereunder, the effect of which would be to likewise cause all of the company's Senior Notes to be in default. Subsequent to March 31, 2016, the company obtained limited waivers from the necessary lenders which waive the audit opinion requirement (i.e., no modifications) until August 14, 2016.

As a result of the event of default caused by our failure to receive an audit opinion with no modifications from our independent certified public accountants (which has been waived only until August 14, 2016), all of the company's indebtedness (with the stated maturities as summarized in the notes to our consolidated financial statements) has been reclassified as a current liability in the company's consolidated balance sheet at March 31, 2016. The explanatory paragraph in the expected audit opinion discussed above also references the audit opinion-related event of default under various borrowing arrangements as an uncertainty that raises substantial doubt about the company's ability to continue as a going concern.

The company is engaged in discussions with its principal lenders and noteholders to amend and/or waive the company's 3.0x minimum interest coverage ratio covenant in advance of any such potential default occurring, with the goal of finalizing any amendments and/or waivers prior to the possible covenant breach. Any such amendments and/or waivers would require successful negotiations with our bank group and noteholders, and may require the company to make certain concessions under the existing agreements, such as providing collateral to secure the Bank Loan Agreement, the Troms Offshore Debt and the Senior Notes, repaying all or a portion of the indebtedness outstanding under the revolving portion of the Bank Loan Agreement, accepting a reduction in total borrowing capacity under the revolving credit facility, paying a higher rate of interest, paying down a portion of the Troms Offshore Debt and/or Senior Notes, or some combination of the above. In addition, such amendments and/or waivers will need to address the audit opinion requirement of the Bank Loan Agreement and the Troms Offshore Debt (which, again, has been waived only until August 14, 2016). Obtaining the covenant relief will require the company to reach an agreement that satisfies potentially divergent interests of our lenders and noteholders.

The company's consolidated financial statements as of and for the year ended March 31, 2016 have been prepared assuming the company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business for the twelve month period following the date of these consolidated financial statements. However, for the above described reasons, indebtedness with the stated maturities as summarized in the notes to the consolidated financial statements is classified as a current liability at March 31, 2016.

As previously announced, Tidewater will hold a conference call to discuss March quarterly earnings on Thursday, May 26, 2016, at 10:00 a.m. Central time. Investors and interested parties may listen to the teleconference via telephone by calling 1-888-771-4371 if calling from the U.S. or Canada (1-847-585-4405 if calling from outside the U.S.) and ask for the "Tidewater" call just prior to the scheduled start. A replay of the conference call will be available beginning at 12:00 p.m. Central time on May 26, 2016, and will continue until 11:59 p.m. Central time on May 28, 2016. To hear the replay, call 1-888-843-7419 (1-630-652-3042 if calling from outside the U.S.). The conference call ID number is 42611721.

A simultaneous webcast of the conference call will be available online at the Tidewater Inc. website, (http://www.tdw.com). The online replay will be available until June 23, 2016.

The conference call will contain forward-looking statements in addition to statements of historical fact. The actual achievement of any forecasted results or the unfolding of future economic or business developments in a way anticipated or projected by the Company involve numerous risks and uncertainties that may cause the Company's actual performance to be materially different from that stated or implied in the forward-looking statements. Such risks and uncertainties include, among other things, risks associated with the general nature of the oilfield service industry and other factors discussed within the "Risk Factors" section of Tidewater's recent Forms 10-Q and 10-K.

Tidewater is the leading provider of Offshore Service Vessels (OSVs) to the global energy industry.

Note: all per-share amounts are stated on a diluted basis.

Financial information is displayed on the next page.

TIDEWATER INC. CONSOLIDATED STATEMENTS OF EARNINGS (In thousands, except share and per share data)

	Quarter Ended				Year Ended
	March 31,				March 31,
	2016		2015		2016		2015
Revenues:
Vessel revenues	$	180,048		317,770		955,400		1,468,358
Other operating revenues		4,126		6,992		23,662		27,159
		184,174		324,762		979,062		1,495,517
Costs and expenses:
Vessel operating costs		98,146		193,940		561,133		834,368
Costs of other operating revenues		3,187		6,889		18,811		26,505
General and administrative		36,974		45,355		153,811		189,819
Vessel operating leases		8,337		8,075		33,662		28,322
Depreciation and amortization		45,251		45,054		182,309		175,204
Gain on asset dispositions, net		(6,692)		(10,704)		(26,037)		(23,796)
Asset impairments		55,540		6,429		117,311		14,525
Goodwill impairment		—		—		—		283,699
Restructuring charge		—		4,052		7,586		4,052
		240,743		299,090		1,048,586		1,532,698
Operating income (loss)		(56,569)		25,672		(69,524)		(37,181)
Other income (expenses):
Foreign exchange gain (loss)		(1,645)		225		(5,403)		8,678
Equity in net earnings (losses) of unconsolidated companies		(6,511)		1,075		(13,581)		10,179
Interest income and other, net		949		372		2,703		1,927
Interest and other debt costs, net		(14,011)		(12,102)		(53,752)		(50,029)
		(21,218)		(10,430)		(70,033)		(29,245)
Earnings (loss) before income taxes		(77,787)		15,242		(139,557)		(66,426)
Income tax expense (benefit)		3,823		24,134		20,819		(1,077)
Net loss	$	(81,610)		(8,892)		(160,376)		(65,349)
Less: Net income (losses) attributable to noncontrolling interests		177		184		(193)		(159)
Net loss attributable to Tidewater Inc.	$	(81,787)		(9,076)		(160,183)		(65,190)
Basic loss per common share	$	(1.74)		(0.19)		(3.41)		(1.34)
Diluted loss per common share	$	(1.74)		(0.19)		(3.41)		(1.34)
Weighted average common shares outstanding		46,983,430		46,814,976		46,981,102		48,658,840
Dilutive effect of stock options and restricted stock		—		—		—		—
Adjusted weighted average common shares		46,983,430		46,814,976		46,981,102		48,658,840

TIDEWATER INC. CONSOLIDATED BALANCE SHEETS

March 31, 2016 and 2015
(In thousands, except share and par value data)
ASSETS	2016		2015
Current assets:
Cash and cash equivalents	$	678,438		78,568
Trade and other receivables, less allowance for doubtful accounts of $11,450 in 2016 and $37,634 in 2015		228,113		303,096
Due from affiliate		338,595		420,365
Marine operating supplies		33,413		49,005
Other current assets		44,755		17,781
Total current assets		1,323,314		868,815
Investments in, at equity, and advances to unconsolidated companies		37,502		65,844
Properties and equipment:
Vessels and related equipment		4,666,749		4,717,132
Other properties and equipment		92,065		119,879
		4,758,814		4,837,011
Less accumulated depreciation and amortization		1,207,523		1,090,704
Net properties and equipment		3,551,291		3,746,307
Other assets		78,440		75,196
Total assets	$	4,990,547		4,756,162

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	49,130		54,011
Accrued expenses		91,611		146,255
Due to affiliate		187,971		185,657
Accrued property and liability losses		3,321		3,669
Current portion of long-term debt		2,052,270		10,181
Other current liabilities		74,825		82,461
Total current liabilities		2,459,128		482,234
Long-term debt		—		1,524,295
Deferred income taxes		34,841		23,276
Accrued property and liability losses		9,478		10,534
Other liabilities and deferred credits		181,546		235,108

Commitments and Contingencies

Equity:
Common stock of $0.10 par value, 125,000,000 shares authorized, issued 47,067,715 shares at March 31, 2016 and 47,029,359 shares at March 31, 2015		4,707		4,703
Additional paid-in capital		166,604		159,940
Retained earnings		2,135,075		2,330,223
Accumulated other comprehensive loss		(6,866)		(20,378)
Total stockholders' equity		2,299,520		2,474,488
Noncontrolling interests		6,034		6,227
Total equity		2,305,554		2,480,715
Total liabilities and equity	$	4,990,547		4,756,162

TIDEWATER INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (In thousands)

	Quarter Ended				Year Ended
	March 31,				March 31,
	2016		2015		2016		2015
Net loss	$	(81,610)		(8,892)		(160,376)		(65,349)
Other comprehensive income (loss):
Unrealized gains (losses) on available for sale securities, net of tax of ($239), $0, ($239) and $0, respectively		24		64		(443)		143
Amortization of loss on derivative contract, net of tax of $77, $0, $77 and $0, respectively		(395)		368		143		717
Change in supplemental executive retirement plan pension liability, net of tax of $1,264, $0, $1,264 and $0, respectively		2,347		(1,845)		2,347		(1,845)
Change in pension plan minimum liability, net of tax of $1,093, $0, $1,093 and $0, respectively		2,029		(5,739)		2,029		(5,739)
Change in other benefit plan minimum liability, net of tax of $5,081, ($840), $5,081 and ($769), respectively		9,366		(1,560)		9,436		(1,429)
Total comprehensive loss	$	(68,239)		(17,604)		(146,864)		(73,502)

TIDEWATER INC. CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended March 31, 2016, 2015 and 2014
(In thousands)	2016		2015		2014
Operating activities:
Net (loss) earnings	$	(160,376)		(65,349)		140,255
Adjustments to reconcile net (loss) earnings to net cash provided by operating activities:
Depreciation and amortization		182,309		175,204		167,480
Benefit for deferred income taxes		(6,796)		(72,389)		(34,709)
Gain on asset dispositions, net		(26,037)		(23,796)		(21,063)
Asset impairments		117,311		14,525		9,341
Goodwill impairment		—		283,699		56,283
Equity in earnings (losses) of unconsolidated companies, net of dividends		28,704		(1,916)		(15,801)
Compensation expense – stock based		13,219		21,374		19,642
Excess tax (benefit) liability on stock options exercised		1,605		1,784		(299)
Changes in assets and liabilities, net:
Trade and other receivables		71,540		(43,537)		13,485
Changes in due to/from affiliate, net		84,084		108,588		(260,675)
Marine operating supplies		13,672		6,148		5,715
Other current assets		5,976		2,794		(7,600)
Accounts payable		(4,881)		(22,989)		(1,395)
Accrued expenses		(53,143)		(11,435)		34,458
Accrued property and liability losses		(348)		38		(429)
Other current liabilities		(15,578)		118		10,373
Other liabilities and deferred credits		231		4,875		(11,842)
Other, net		1,868		(19,023)		1,398
Net cash provided by operating activities		253,360		358,713		104,617
Cash flows from investing activities:
Proceeds from sales of assets		10,690		8,310		51,330
Proceeds from sale/leaseback of assets		—		123,950		270,575
Additions to properties and equipment		(194,485)		(364,194)		(594,695)
Refunds from cancelled vessel construction contracts		46,119		—		—
Payments for acquisition, net of cash acquired		—		—		(127,737)
Other		2,680		516		(3,158)
Net cash used in investing activities		(134,996)		(231,418)		(403,685)
Cash flows from financing activities:
Debt issuance costs		(996)		(556)		(5,347)
Principal payment on long-term debt		(136,843)		(97,823)		(1,103,054)
Debt borrowings		656,338		138,488		1,465,362
Proceeds from exercise of stock options		—		1,023		6,863
Cash dividends		(35,388)		(48,834)		(49,816)
Excess tax benefit (liability) on stock options exercised		(1,605)		(1,784)		299
Cash contributions from noncontrolling interests, net		—		399		4,551
Repurchases of common stock		—		(99,999)		—
Net cash (used in) provided by financing activities		481,506		(109,086)		318,858
Net change in cash and cash equivalents		599,870		18,209		19,790
Cash and cash equivalents at beginning of year		78,568		60,359		40,569
Cash and cash equivalents at end of year	$	678,438		78,568		60,359
Supplemental disclosure of cash flow information:
Cash paid during the year for:
Interest, net of amounts capitalized	$	50,729		49,390		34,190
Income taxes	$	51,585		74,310		59,266
Supplemental disclosure of noncash investing activities:
Additions to properties and equipment	$	—		2,068		5,751

TIDEWATER INC. CONSOLIDATED STATEMENTS OF EQUITY

Years Ended March 31, 2016, 2015 and 2014 (In thousands)	Common stock		Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Non controlling interest		Total
Balance at March 31, 2013	$	4,949		119,975		2,453,973		(17,141)		—		2,561,756
Total comprehensive income		—		—		140,255		4,916		—		145,171
Stock option activity		20		9,445		—		—		—		9,465
Cash dividends declared ($1.00 per share)		—		—		(49,973)		—		—		(49,973)
Amortization of restricted stock units		10		9,923		—		—		—		9,933
Amortization/cancellation of restricted stock		(6)		3,038		—		—		—		3,032
Noncontrolling interests		—		—		—		—		5,987		5,987
Balance at March 31, 2014	$	4,973		142,381		2,544,255		(12,225)		5,987		2,685,371
Total comprehensive loss		—		—		(65,190)		(8,153)		(159)		(73,502)
Stock option activity		3		(691)		—		—		—		(688)
Cash dividends declared ($1.00 per share)		—		—		(49,127)		—		—		(49,127)
Retirement of common stock		(284)		—		(99,715)		—		—		(99,999)
Amortization of restricted stock units		17		15,270		—		—		—		15,287
Amortization/cancellation of restricted stock		(6)		2,980		—		—		—		2,974
Cash received from noncontrolling interests, net		—		—		—		—		399		399
Balance at March 31, 2015	$	4,703		159,940		2,330,223		(20,378)		6,227		2,480,715
Total comprehensive loss		—		—		(160,183)		13,512		(193)		(146,864)
Stock option activity		—		(278)		—		—		—		(278)
Cash dividends declared ($.75 per share)		—		—		(34,965)		—		—		(34,965)
Amortization of restricted stock units		11		6,463		—		—		—		6,474
Amortization/cancellation of restricted stock		(7)		479		—		—		—		472
Balance at March 31, 2016	$	4,707		166,604		2,135,075		(6,866)		6,034		2,305,554

The company's vessel revenues and vessel operating costs and the related percentage of total vessel revenues for the quarters and the years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015, were as follows:

	Quarter Ended								Year Ended								Quarter
	Quarter Ended								Year Ended								Ended
	March 31,								March 31,								December 31,
(In thousands)	2016		%		2015		%		2016		%		2015		%		2015		%
Vessel revenues:
Americas	$	63,650		35%		117,149		37%		342,995		36%		505,699		35%		75,963		36%
Asia/Pacific		9,791		6%		29,536		9%		89,045		9%		150,820		10%		19,144		9%
Middle East/North Africa		35,685		20%		45,486		14%		168,471		18%		205,787		14%		40,184		19%
Sub-Saharan Africa/ Europe		70,922		39%		125,599		40%		354,889		37%		606,052		41%		77,617		36%
Total vessel revenues	$	180,048		100%		317,770		100%		955,400		100%		1,468,358		100%		212,908		100%
Vessel operating costs:
Crew costs	$	55,549		31%		98,045		31%		303,219		32%		428,131		29%		71,270		33%
Repair and maintenance		14,280		8%		40,307		13%		94,873		10%		173,788		12%		14,811		7%
Insurance and loss reserves		(1,230)		(1%)		7,213		2%		8,585		1%		17,683		1%		1,689		1%
Fuel, lube and supplies		10,366		6%		18,372		6%		61,992		6%		88,272		6%		16,369		8%
Other		19,181		11%		30,003		9%		92,464		10%		126,494		9%		20,955		10%
Total vessel operating costs		98,146		55%		193,940		61%		561,133		59%		834,368		57%		125,094		59%
Vessel operating margin (A)	$	81,902		45%		123,830		39%		394,267		41%		633,990		43%		87,814		41%

Note (A): The following table reconciles vessel operating margin as presented above to operating profit for the quarters and the years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015:

	Quarter Ended				Year Ended				Quarter
	Quarter Ended				Year Ended				Ended
	March 31,				March 31,				December 31,
(In thousands)	2016		2015		2016		2015		2015
Vessel operating margin	$	81,902		123,830		394,267		633,990		87,814
General and administrative expenses - vessel operations		(27,045)		(34,190)		(116,039)		(144,495)		(27,686)
Vessel operating leases		(8,337)		(8,075)		(33,662)		(28,322)		(8,441)
Depreciation and amortization - vessel operations		(42,427)		(42,179)		(170,428)		(167,217)		(42,424)
Vessel operating profit	$	4,093		39,386		74,138		293,956		9,263

The company's other operating loss for the quarters and the years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015, consists of the following:

	Quarter Ended				Year Ended				Quarter
	Quarter Ended				Year Ended				Ended
	March 31,				March 31,				December 31,
(In thousands)	2016		2015		2016		2015		2015
Other operating revenues	$	4,126		6,992		23,662		27,159		5,283
Costs of other marine revenues		(3,187)		(6,889)		(18,811)		(26,505)		(3,778)
General and administrative expenses - other operating activities		(947)		(1,226)		(3,694)		(4,703)		(762)
Depreciation and amortization - other operating activities		(1,436)		(1,351)		(5,721)		(3,973)		(1,369)
Other operating loss	$	(1,444)		(2,474)		(4,564)		(8,022)		(626)

The company's operating earnings (loss) and other components of earnings (loss) before income taxes, and its related percentage of total revenues for the quarters and years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015, were as follows:

	Quarter Ended								Year Ended								Quarter
	Quarter Ended								Year Ended								Ended
	March 31,								March 31,								December 31,
(In thousands)	2016		%		2015		%		2016		%		2015		%		2015		%
Vessel operating profit (loss):
Americas (B)	$	11,026		6%		22,218		7%		52,966		5%		122,988		8%		9,289		4%
Asia/Pacific (B)		(5,809)		(3%)		2,477		1%		(1,687)		(<1%)		11,541		1%		(3,796)		(2%)
Middle East/North Africa		5,825		3%		5,690		1%		27,349		3%		37,258		3%		5,849		3%
Sub-Saharan Africa/Europe		(6,949)		(4%)		9,001		3%		(4,490)		(<1%)		122,169		8%		(2,079)		(1%)
		4,093		2%		39,386		12%		74,138		8%		293,956		20%		9,263		4%
Other operating loss		(1,444)		(1%)		(2,474)		(1%)		(4,564)		(<1%)		(8,022)		(1%)		(626)		(<1%)
		2,649		1%		36,912		11%		69,574		8%		285,934		19%		8,637		4%

Corporate general and administrative expenses		(8,982)		(5%)		(9,939)		(3%)		(34,078)		(3%)		(40,621)		(3%)		(7,150)		(3%)
Corporate depreciation		(1,388)		(1%)		(1,524)		(<1%)		(6,160)		(1%)		(4,014)		(<1%)		(1,629)		(1%)
Corporate expenses		(10,370)		(6%)		(11,463)		(3%)		(40,238)		(4%)		(44,635)		(3%)		(8,779)		(4%)

Gain on asset dispositions, net		6,692		4%		10,704		3%		26,037		3%		23,796		1%		5,883		2%
Asset impairments		(55,540)		(30%)		(6,429)		(2%)		(117,311)		(12%)		(14,525)		(1%)		(15,141)		(6%)
Goodwill impairment		—		—		—		—		—		—		(283,699)		(19%)		—		—
Restructuring charge		—		—		(4,052)		(1%)		(7,586)		(1%)		(4,052)		(<1%)		—		—
Operating income (loss)	$	(56,569)		(31%)		25,672		8%		(69,524)		(7%)		(37,181)		(3%)		(9,400)		(4%)
Foreign exchange gain (loss)		(1,645)		(1%)		225		<1%		(5,403)		(1%)		8,678		1%		(469)		(<1%)
Equity in net earnings (losses) of unconsolidated companies		(6,511)		(4%)		1,075		<1%		(13,581)		(1%)		10,179		1%		(1,710)		(1%)
Interest income and other, net		949		1%		372		<1%		2,703		<1%		1,927		<1%		609		<1%
Interest and other debt costs, net		(14,011)		(7%)		(12,102)		(4%)		(53,752)		(5%)		(50,029)		(3%)		(13,312)		(6%)
Earnings (loss) before income taxes	$	(77,787)		(42%)		15,242		5%		(139,557)		(14%)		(66,426)		(4%)		(24,282)		(11%)

Note (B): Americas fiscal 2016 figure excludes restructuring charges of $3.6 million. Asia/Pacific fiscal 2016 and 2015 amounts exclude restructuring charges of $4.0 million and $3.7 million, respectively.

The company's revenues, day-based vessel utilization percentages and average day rates by vessel class and in total for the quarters and the years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015, were as follows:

	Quarter Ended					Year Ended				Quarter
	Quarter Ended					Year Ended				Ended
	March 31,					March 31,				December 31,
	2016			2015		2016		2015		2015
REVENUE BY VESSEL CLASS (In thousands):
Americas fleet:
Deepwater	$	43,802			85,249		235,522		353,232		49,792
Towing-supply		16,878			27,518		92,768		125,029		22,254
Other		2,970			4,382		14,705		27,438		3,917
Total	$	63,650			117,149		342,995		505,699		75,963
Asia/Pacific fleet:
Deepwater	$	4,318			22,046		60,853		94,538		13,267
Towing-supply		5,473			7,419		28,192		53,281		5,877
Other		—			71		—		3,001		—
Total	$	9,791			29,536		89,045		150,820		19,144
Middle East/North Africa fleet:
Deepwater	$	15,718			20,943		74,563		85,279		17,690
Towing-supply		19,276			23,797		91,174		117,232		21,795
Other		691			746		2,734		3,276		699
Total	$	35,685			45,486		168,471		205,787		40,184
Sub-Saharan Africa/Europe fleet:
Deepwater	$	30,338			64,302		154,620		326,315		30,361
Towing-supply		31,914			45,739		150,404		208,324		35,186
Other		8,670			15,558		49,865		71,413		12,070
Total	$	70,922			125,599		354,889		606,052		77,617
Worldwide fleet:
Deepwater	$	94,176			192,540		525,558		859,364		111,110
Towing-supply		73,541			104,473		362,538		503,866		85,112
Other		12,331			20,757		67,304		105,128		16,686
Total	$	180,048			317,770		955,400		1,468,358		212,908
UTILIZATION:
Americas fleet:
Deepwater		45.6	%		88.3		61.1		89.0		53.6
Towing-supply		43.6			65.7		53.4		68.2		48.9
Other		59.5			50.2		52.6		63.3		60.4
Total		46.5	%		73.2		57.1		76.5		52.7
Asia/Pacific fleet:
Deepwater		17.4	%		66.6		40.5		71.4		40.6
Towing-supply		56.3			63.2		67.6		81.1		62.6
Other		—			7.5		—		77.2		—
Total		38.0	%		62.5		53.6		77.2		51.0
Middle East/North Africa fleet:
Deepwater		61.7	%		81.8		67.7		81.1		65.4
Towing-supply		57.8			68.7		69.0		78.3		66.9
Other		100.0			100.0		97.9		98.0		100.0
Total		60.8	%		73.7		69.8		79.9		67.8
Sub-Saharan Africa/Europe fleet:
Deepwater		55.8	%		76.5		58.0		83.7		50.6
Towing-supply		56.8			71.5		61.4		76.0		58.5
Other		66.8			67.2		70.5		72.5		71.5
Total		59.7	%		71.3		63.4		76.9		60.4
Worldwide fleet:
Deepwater		47.9	%		80.7		58.4		84.1		52.5
Towing-supply		53.7			68.3		62.3		75.2		58.9
Other		65.5			63.4		66.7		71.4		69.1
Total		53.6	%		71.4		61.7		77.3		58.4

	Quarter Ended				Year Ended			Quarter
	Quarter Ended				Year Ended			Ended
	March 31,				March 31,			December 31,
	2016		2015		2016		2015		2015
AVERAGE VESSEL DAY RATES:
Americas fleet:
Deepwater	$	25,795		28,972		26,755	30,986		25,584
Towing-supply		14,701		15,482		16,372	16,590		17,071
Other		6,056		6,777		7,344	8,378		7,050
Total	$	19,077		21,830		20,824	22,768		19,962
Asia/Pacific fleet:
Deepwater	$	21,112		33,443		32,467	37,723		27,345
Towing-supply		6,434		9,362		7,336	12,870		6,379
Other		—		10,609		—	10,652		—
Total	$	9,278		20,252		15,575	21,771		13,611
Middle East/North Africa fleet:
Deepwater	$	18,666		22,558		20,833	23,816		20,995
Towing-supply		11,826		12,526		11,646	13,242		11,430
Other		3,800		4,145		3,784	4,581		3,800
Total	$	13,446		15,121		13,889	15,650		13,699
Sub-Saharan Africa/Europe fleet:
Deepwater	$	17,072		27,239		20,431	29,428		18,355
Towing-supply		14,709		16,600		15,878	16,817		15,565
Other		3,960		5,605		4,962	5,771		4,764
Total	$	11,557		15,916		13,100	16,905		12,037
Worldwide fleet:
Deepwater	$	20,827		27,942		24,081	30,074		22,546
Towing-supply		12,683		14,460		13,522	15,307		13,315
Other		4,309		5,752		5,269	6,316		5,098
Total	$	13,658		17,928		15,558	18,792		14,589

The company's actual vessel count at March 31, 2016 and the average number of vessels by class and geographic distribution for the quarters and the years ended March 31, 2016 and 2015 and for the quarter ended December 31, 2015:


	Actual Vessel										Quarter
	Count at		Quarter Ended				Year Ended				Ended
	March 31,		March 31,				March 31,				December 31,
	2016			2016	2015			2016	2015		2015
Americas fleet:
Deepwater		41		41		37		39		35		40
Towing-supply		27		29		30		30		30		29
Other		9		9		14		10		14		10
Total		77		79		81		79		79		79
Less stacked vessels		28		29		10		18		9		18
Active vessels		49		50		71		61		70		61
Asia/Pacific fleet:
Deepwater		13		13		11		13		10		13
Towing-supply		17		16		14		15		14		16
Other		1		1		1		1		1		1
Total		31		30		26		29		25		30
Less stacked vessels		16		13		—		9		—		12
Active vessels		15		17		26		20		25		18
Middle East/North Africa fleet:
Deepwater		15		15		13		14		12		14
Towing-supply		31		31		31		31		31		31
Other		2		2		2		2		2		2
Total		48		48		46		47		45		47
Less stacked vessels		9		8		1		5		1		5
Active vessels		39		40		45		42		44		42
Sub-Saharan Africa/Europe fleet:
Deepwater		35		35		34		36		36		36
Towing-supply		42		42		43		42		45		42
Other		36		36		46		39		47		38
Total		113		113		123		117		128		116
Less stacked vessels		24		23		8		18		6		22
Active vessels		89		90		115		99		122		94
Active owned or chartered vessels		192		197		257		222		261		215
Stacked vessels		77		73		19		50		16		57
Total owned or chartered vessels		269		270		276		272		277		272
Joint-venture and other		9		9		10		9		11		9
Total		278		279		286		281		288		281

Note (C): Included in total owned or chartered vessels at March 31, 2016 and 2015 and at December 31, 2015, were 77, 21 and 70 vessels, respectively, that were stacked by the company. These vessels were considered to be in service and are included in the calculation of the company's utilization statistics.

The table below summarizes the various commitments to acquire and construct new vessels, by vessel type, as of March 31, 2016:

(In thousands)

Number

Shipyard

Delivery

Total

Amount

Remaining

Invested

Balance

Vessels

Location

Dates

Cost

03/31/16

Deepwater

261-foot PSV

International

6/2016, 7/2016

292-foot PSV

International

9/2016

300-foot PSV

United States

1/2017, 5/2017

310-foot PSV

United States

4/2016

Total Deepwater PSVs

251,420

183,904

67,516

Total commitments

251,420

183,904

67,516

Note (D): Six additional option vessels and a fast supply boat are not included in the table above. The company is entitled to receive a refund of prior shipyard payments totaling approximately $31 million which would offset the remaining balance of vessel commitments.

The table below summarizes by vessel class and vessel type the number of vessels expected to be delivered by quarter along with the expected cash outlay (in thousands) of the various vessel commitments as discussed above:

	Quarter Period Ended
Vessel class and type	06/16		09/16		12/16		03/17		06/17
Deepwater PSVs		2		2		—		1		1
Totals		2		2		—		1		1
(In thousands)
Expected quarterly cash outlay	$	10,449		43,553		2,311		6,313		4,890

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SOURCE Tidewater Inc.

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