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Dril-Quip, Inc. Announces Results For First Quarter 2016

The following excerpt is from the company's SEC filing.

HOUSTON, April 26, 2016 Dril-Quip, Inc. (NYSE: DRQ) today announced net income of $36.8 million, or $0.97 per diluted share, for the three months ended March 31, 2016, versus net income of $53.7 million, or $1.38 per diluted share, for the first quarter of 2015. The first quarter 2016 results were favorably impacted by an after-tax foreign exchange gain of $5.4 million, or $0.14 per diluted share, as compared to an after-tax foreign exchange gain of $4.8 million, or $0.12 per diluted share, during the first quarter of 2015. In addition, total revenues were $166.6 million during the quarter ended March 31, 2016 c ompared to $226.0 million for the same period in 2015.

The Companys backlog at March 31, 2016 was approximately $522 million, compared to its March 31, 2015 backlog of approximately $1.1 billion and its December 31, 2015 backlog of approximately $685 million.

Blake DeBerry, Dril-Quips President and CEO, stated, Despite the ongoing difficult and challenging market conditions existing in our industry, we are pleased to report that both gross margins and earnings per share results exceeded our expectations for the quarter.

Continued weak and volatile oil prices, leading to declining capital expenditure budgets for our customers, resulted in disappointing booking levels during the period. Unfortunately, uncertainties persist regarding our bookings and our book-and-ship business for the remainder of the year.

Looking forward, we continue to believe that our balance sheet, highlighted by a strong cash position and zero debt, leaves us well-positioned to take advantage of opportunities which may arise, whether in the current climate or when the market rebounds. The Company intends to continue its strategy of investing counter cyclically through the pursuit of attractive acquisition candidates, the repurchase of stock through our stock buy-back program and our research and development efforts to benefit the Company in the long term.

Based upon current market conditions, the Company expects its earnings per diluted share for the second quarter of 2016 to approximate $0.60 to $0.70 and its earnings per diluted share for the full year to approximate $2.45 to $2.65, excluding foreign currency gains/losses or any unusual items.

Dril-Quip is a leading manufacturer of highly engineered offshore drilling and production equipment, which is well suited for use in deepwater, harsh environment and severe service applications.

Statements contained herein relating to future operations and financial results that are forward looking statements, including statements regarding general economic conditions, commodity price levels, future financial results, acquisitions and stock repurchases, are based upon certain assumptions and analyses made by the management of the Company in light of its experience and perception of historical trends, current conditions, expected future developments and other factors. These statements are subject to risks, some of which are beyond the Companys control, including, but not limited to, the volatility of oil and natural gas prices and cyclicality of the oil and gas industry, uncertainties regarding the effects of new governmental regulations, the Companys ability to convert backlog into revenues on a profitable basis, the possibility of cancellations of orders, the Companys international operations, operating risks, and other factors detailed in the Companys public filings with the Securities and Exchange Commission. Investors are cautioned that any such statements are not guarantees of future performance and actual outcomes may vary materially from those indicated.

Comparative Condensed Consolidated Statements of Income

(in thousands, except per share amounts)

(Unaudited)

Three months ended

March 31,

Revenues

166,561

226,002

Cost and expenses:

Cost of sales

93,096

125,138

Selling, general and administrative

13,221

16,958

Engineering and product development

10,901

12,213

117,218

154,309

Operating income

49,343

71,693

Interest income

Interest expense

Income before income taxes

49,821

71,739

Income tax provision

13,052

18,075

Net income

36,769

53,664

Diluted earnings per share

Weighted average sharesdiluted

37,847

38,940

Depreciation and amortization

Capital expenditures

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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Other recent filings from the company include the following:

Quarterly report [Sections 13 or 15(d)] - April 26, 2016
Dril-Quip insider just picked up 136 shares - April 4, 2016

Dril-Quip insider just picked up 469 shares - April 4, 2016