Vantage Drilling International Reports First Quarter Results for 2016


HOUSTON, TX--(Marketwired - May 13, 2016) - Vantage Drilling International ("Vantage" or the "Company") reported a net loss of $471.0 million for the period from January 1, 2016 to February 10, 2016 for the Predecessor Company and a net loss of $29.0 million for the Successor for the period, including February 10, 2016, through March 31, 2016. Upon emergence from Chapter 11 bankruptcy on February 10, 2016, Vantage adopted fresh-start accounting, which resulted in the Company becoming a new entity for financial reporting purposes. References to "Successor" relate to the financial position and results of operations of the reorganized Vantage as of and subsequent to February 10, 2016. References to "Predecessor" refer to the financial position of Vantage as of and prior to February 10, 2016 and the results of operations prior to February 10, 2016. As a result of the application of fresh-start accounting and the effects of the implementation of our Plan of Reorganization, the financial statements on or after February 10, 2016 are not comparable with the financial statements prior to that date.

The Predecessor's operating results for the period from January 1, 2016 to February 10, 2016, include approximately $452.9 million of Reorganization Items. The Successor's operating results for the period from February 10, 2016 through March 31, 2016 include Reorganization Items of approximately $154,000.

For the three month period ended March 31, 2015, the Predecessor reported net income of approximately $22.6 million.

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with an owned fleet of three ultra-deepwater drillships; the Platinum Explorer, the Titanium Explorer and the Tungsten Explorer, as well as four Baker Marine Pacific Class 375 ultra-premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells. Vantage also provides construction supervision services for, and will operate and manage, drilling units owned by others. Through its fleet of seven owned drilling units, Vantage is a provider of offshore contract drilling services globally to major, national and large independent oil and natural gas companies.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the company's filings with the Securities and Exchange Commission. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements.

   
   
Vantage Drilling International  
Consolidated Statement of Operations  
(Unaudited, in thousands)  
   
  Successor     Predecessor  
  Period from February 10, 2016 to March 31, 2016     Period from January 1, 2016 to February 10, 2016     Three Months Ended March 31, 2015  
Revenue                      
  Contract drilling services $ 24,059     $ 20,891       207,981  
  Management fees   959       752       1,881  
  Reimbursables   4,768       1,897       10,659  
    Total revenue   29,786       23,540       220,521  
Operating costs and expenses                      
  Operating costs   27,439       25,213       95,350  
  General and administrative   9,168       2,558       5,990  
  Depreciation   12,076       10,696       31,623  
    Total operating costs and expenses   48,683       38,467       132,963  
Income (loss) from operations   (18,897 )     (14,927 )     87,558  
Other income (expense)                      
  Interest income   6       3       12  
  Interest expense and other financing charges   (10,650 )     (1,728 )     (46,119 )
  Gain on debt extinguishment   --       --       10,825  
  Other, net   1,834       (69 )     (151 )
  Reorganization items   (154 )     (452,923 )     --  
    Total other income (expense)   (8,964 )     (454,717 )     (35,433 )
Income (loss) before income taxes   (27,861 )     (469,644 )     52,125  
Income tax provision   1,167       2,371       29,289  
Net income (loss)   (29,028 )     (472,015 )     22,836  
Net income (loss) attributable to noncontrolling interests   --       (969 )     190  
Net income (loss) attributable to VDI $ (29,028 )   $ (471,046 )   $ 22,646  
                       
                       
Vantage Drilling International  
Supplemental Operating Data  
(Unaudited, in thousands, except percentages)  
   
  Successor     Predecessor  
  Period from February 10, 2016 to March 31, 2016     Period from January 1, 2016 to February 10, 2016     Three Months Ended March 31, 2015  
Operating costs and expenses                      
Jackups $ 8,278     $ 5,975     $ 24,263  
Deepwater   13,146       15,550       56,093  
Operations support   2,215       2,219       8,722  
Reimbursables   3,800       1,469       6,272  
  $ 27,439     $ 25,213     $ 95,350  
                       
Utilization                      
Jackups   60.0 %     53.6 %     96.1 %
Deepwater   33.3 %     33.3 %     93.5 %
                       
Vantage Drilling International  
Consolidated Balance Sheet  
(In thousands, except par value information)  
(Unaudited)  
             
    Successor     Predecessor  
    March 31,
2016
    December 31,
2015
 
ASSETS                
Current assets                
  Cash and cash equivalents   $ 249,201     $ 203,420  
  Restricted cash     1,000       -  
  Trade receivables     51,668       70,722  
  Inventory     44,463       64,495  
  Prepaid expenses and other current assets     20,167       22,106  
    Total current assets     366,499       360,743  
Property and equipment                
  Property and equipment     898,586       3,481,006  
  Accumulated depreciation     (11,997 )     (532,619 )
    Property and equipment, net     886,589       2,948,387  
Other assets     9,872       23,050  
Total assets   $ 1,262,960     $ 3,332,180  
                 
LIABILITIES AND SHAREHOLDER'S EQUITY                
Current liabilities                
  Accounts payable   $ 41,256     $ 49,437  
  Accrued liabilities     38,757       21,702  
  Current maturities of long-term debt     1,430       --  
  VDC note payable     --       61,477  
    Total current liabilities     81,443       132,616  
Long-term debt, net of discount of $140,073 and $0     825,040       --  
Other long-term liabilities     11,528       33,097  
Liabilities subject to compromise     --       2,694,456  
Commitments and contingencies                
Shareholder's equity                
  Predecessor ordinary shares, $0.001 par value, 50 million shares authorized; one thousand shares issued and outstanding     --       --  
  Predecessor additional paid-in capital     --       595,119  
  Successor ordinary shares, $0.001 par value, 50 million shares authorized; 5,000 shares issued and outstanding     5       --  
  Successor additional paid-in capital     373,972       --  
  Accumulated deficit     (29,028 )     (138,363 )
    Total VDI shareholder's equity     344,949       456,756  
Noncontrolling interests     --       15,255  
  Total equity     344,949       472,011  
Total liabilities and equity   $ 1,262,960     $ 3,332,180  
                 
Vantage Drilling International  
Consolidated Statement of Cash Flows  
(Unaudited, in thousands)  
                   
    Successor     Predecessor  
    Period from February 10, 2016 to March 31, 2016     Period from January 1, 2016 to February 10, 2016     Three Months Ended March 31, 2015  
CASH FLOWS FROM OPERATING ACTIVITIES                        
Net income (loss)   $ (29,028 )   $ (472,015 )   $ 22,836  
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                        
  Depreciation expense     12,076       10,696       31,623  
  Amortization of debt financing costs     76       --       2,127  
  Amortization of debt discount     6,847       --       602  
  Reorganization items     --       430,210       --  
  Non-cash gain on debt extinguishment     --       --       (10,816 )
  Deferred income tax benefit     (606 )     --       (525 )
  Loss on disposal of assets     144       --       19  
Changes in operating assets and liabilities:                        
  Restricted cash     --       (1,000 )     --  
  Trade receivables     22,629       (3,575 )     (9,162 )
  Inventory     (221 )     223       (2,305 )
  Prepaid expenses and other current assets     (4,954 )     6,893       6,101  
  Other assets     368       941       2,650  
  Accounts payable     6,708       (14,890 )     (41,651 )
  Accrued liabilities and other long-term liabilities     (5,801 )     21,152       41,696  
    Net cash provided by (used in) operating activities     8,238       (21,365 )     43,195  
CASH FLOWS FROM INVESTING ACTIVITIES                        
  Additions to property and equipment     (7,674 )     116       (5,894 )
    Net cash provided by (used in) investing activities     (7,674 )     116       (5,894 )
CASH FLOWS FROM FINANCING ACTIVITIES                        
  Repayment of long-term debt     (358 )     (7,000 )     (40,854 )
  Proceeds from issuance of 10% Second Lien Notes     --       76,125       --  
  Debt issuance costs     (51 )     (2,250 )     --  
    Net cash provided by (used in) financing activities     (409 )     66,875       (40,854 )
    Net increase (decrease) in cash and cash equivalents     155       45,626       (3,553 )
  Cash and cash equivalents--beginning of period     249,046       203,420       75,801  
  Cash and cash equivalents--end of period   $ 249,201     $ 249,046     $ 72,248  
                         
Company ProfileVantage Drilling International