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 12, 2004 (August 12, 2004)
___________________
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 12, 2004.
ITEM 12. RESULT OF OPERATIONS AND FINANCIAL CONDITION.
On August 12, 2004, Torch Offshore, Inc. (the "Company")
issued a press release announcing operating results for the
quarter ended June 30, 2004. 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, as adjusted, for the
three- and six-month periods ended June 30, 2004 in the
press release, which is a "non-GAAP" financial measure under
Regulation G. The components of EBIDTA, as adjusted, 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, as
adjusted, to net income/loss, which is its nearest
comparable GAAP financial measure. However, because EBITDA,
as adjusted, 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, as adjusted, 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 12, 2004 -------------------------
Robert E. Fulton
Chief Financial Officer
INDEX TO EXHIBITS
Exhibit No. Description
----------- -----------
99.1 Torch Offshore, Inc. Press Release, dated
August 12, 2004.
EXHIBIT 99.1
NEWS RELEASE
For immediate release to:
Analysts, Financial Community, Media
Contact: Bob Fulton (1) 504-367-7030
Bradley Lowe (1) 504-367-7030
Torch Offshore Announces 2004 Second Quarter Earnings
New Orleans, Louisiana USA, August 12, 2004
SECOND QUARTER RESULTS
Torch Offshore, Inc. (NASDAQ: TORC) (the "Company")
announced today that revenues for the quarter ended June 30,
2004 were $19.0 million, an increase of 37.1 percent
compared to revenues of $13.9 million for the second quarter
of 2003. Gross profit (revenues less cost of sales) for the
second quarter of 2004 was $1.7 million or 9.1 percent of
revenues compared to the second quarter 2003 gross profit of
$1.4 million or 9.9 percent of revenues. The second quarter
2004 net loss was $2.4 million, or $0.19 per diluted share,
compared to the net loss in the second quarter of 2003,
which was $1.2 million, or $0.09 per diluted share. Included
in the second quarter 2004 net loss is an impairment charge
of $0.6 million, or $0.05 per diluted share, related to the
scrapping of the Midnight Runner.
Lyle G. Stockstill, Torch Offshore, Inc. Chairman and Chief
Executive Officer, commented, "We had a relatively strong
increase in revenues in the second quarter of 2004 as
compared to the year-ago period. However, our gross profit
margin remained low despite an increase in average revenue
per revenue day because of increased vessel operating costs.
Looking forward to the third quarter of 2004, there are some
good potential opportunities for the Company, including the
arrival of the Midnight Brave in Africa for the Marathon
Alba project, which is expected to commence in August 2004."
Stockstill continued, "As for the Midnight Express, the
vessel is expected to arrive in Mobile, Alabama in the third
week of August depending on weather conditions. It should
remain in port there for approximately 30 days as final
installations and vessel rig-up takes place. We continue to
remain positive about the potential this vessel will bring
to the Company in the near term. Also, we continue to remain
in discussions with various potential customers for pipelay
work for the vessel in the fourth quarter of 2004 and the
first half of 2005."
FIRST HALF RESULTS
For the first half of 2004, revenues decreased 0.1 percent
to $30.9 million generating a gross profit of $0.3 million
or 1.0 percent of revenues, compared to year-ago period
revenues of $30.9 million that produced a gross profit of
$4.7 million or 15.1 percent of revenues. The net loss for
the first six months of 2004 totaled $7.6 million, or $0.60
per diluted share, compared to the net loss in the first six
months of 2003, which was $1.1 million, or $0.09 per diluted
share. Included in the net loss for the first six months of
2004 is an impairment charge of $0.6 million, or $0.05 per
diluted share, related to the scrapping of the Midnight
Runner.
CONFERENCE CALL
A conference call will be held at 10:00 a.m. Central Time on
Thursday, August 12, 2004. To participate by telephone,
United States callers can dial (800) 295-4740 and
international callers can dial (617) 614-3925 ten to fifteen
minutes prior to the starting time. The conference ID for
all callers is 16632446. 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 Thursday, August 12, 2004 and ending at
midnight (Central Time) on Wednesday, August 18, 2004. 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 11400851. 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 the timing of the arrival and
completion of the Midnight Express and the potential
workload for the vessel in the future. 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,
2003 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 04-018
# # #
TORCH OFFSHORE, INC.
Statements of Operations (Unaudited)
(in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
2004 2003 2004 2003
---- ---- ---- ----
Revenues $19,020 $13,876 $30,862 $30,905
Cost of revenues:
Cost of sales 17,295 12,500 30,539 26,245
Depreciation and
amortization 2,640 1,822 4,749 3,649
General and
administrative
expenses 1,441 1,348 3,056 2,703
Other operating
expense - - 160 -
------ ------ ------ ------
Total cost of
revenues 21,376 15,670 38,504 32,597
------ ------ ------ ------
Operating loss (2,356) (1,794) (7,642) (1,692)
------ ------ ------ ------
Other income:
Interest income - - - 1
------ ------ ------ ------
Total other income - - - 1
------ ------ ------ ------
Loss before income
taxes (2,356) (1,794) (7,642) (1,691)
Income tax benefit - 628 - 592
------ ------ ------ ------
Net loss $(2,356) $(1,166) $(7,642) $(1,099)
====== ====== ====== ======
Net loss per common
share:
Basic $ (0.19) $ (0.09) $ (0.60) $ (0.09)
====== ====== ====== ======
Diluted $ (0.19) $ (0.09) $ (0.60) $ (0.09)
====== ====== ====== ======
Weighted average common
stock outstanding:
Basic 12,640 12,636 12,639 12,636
====== ====== ====== ======
Diluted 12,640 12,636 12,639 12,636
====== ====== ====== ======
Other data:
EBITDA (A),(B) $ 284 $ 28 $(2,893) $ 1,957
====== ====== ====== ======
(A) The Company calculates EBITDA as earnings before net
interest, income taxes, depreciation and amortization and
certain other vessel charges. Please see Consolidated
Balance Sheet and Other Information included in this News
Release for a reconciliation of EBITDA to net loss. 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/loss, 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,
2004 2003
-------- ---------
Assets
Current assets $ 23,133 $ 24,081
Property, net 166,314 143,266
Other assets 4,254 2,559
-------- --------
Total assets $193,701 $169,906
======== ========
Liabilities and
Stockholders' Equity
Accounts payable - trade $ 17,019 $ 15,148
Accrued expenses and other 12,487 7,707
Midnight Express Finance Facility 69,870 45,639
Current portion of long-term debt 3,922 3,396
Receivable line of credit 8,912 7,227
-------- --------
Total current liabilities 112,210 79,117
Long-term debt, less
current portion 18,341 20,057
Stockholders' equity 63,150 70,732
-------- --------
Total liabilities and
stockholders' equity $193,701 $169,906
======== ========
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
2004 2003 2004 2003
---- ---- ---- ----
EBITDA Reconciliation(B):
Net loss $(2,356) $(1,166) $(7,642) $(1,099)
Income tax benefit - (628) - (592)
Other income - - - (1)
Depreciation and
amortization 2,640 1,822 4,749 3,649
------ ------ ------ ------
EBITDA $ 284 $ 28 $(2,893) $ 1,957
====== ====== ====== ======
(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.