UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
|
| |
ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31, 20192020 or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT |
| |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OF 1934 For the transition period from to
Commission file number 1-12289
SEACOR Holdings Inc.
(Exact Name of Registrant as Specified in Its Charter)
|
| | |
Delaware | | 13-3542736 |
(State or Other Jurisdiction of
Incorporation or Organization)
| | (IRS Employer
Identification No.)
|
| |
2200 Eller Drive, P.O. Box 13038, | | |
Fort Lauderdale, Florida | | 33316 |
(Address of Principal Executive Offices) | | (Zip Code) |
(State or Other Jurisdiction of (IRS EmployerIncorporation or Organization) Identification No.)
2200 Eller Drive, P.O. Box 13038,
Fort Lauderdale, Florida 33316
(Address of Principal Executive Offices) (Zip Code)
954-523-2200
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, par value $0.01 per shareCKH New York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý☒ No ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý☒ No ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting Emerging growth |
| | | | | | | | |
Large accelerated filer x
| | Accelerated filer ¨
| | Non-accelerated filer ¨
(Do not check if a smaller
reporting company)
| | Smaller reporting company ¨
| | Emerging growth company ¨
|
(Do not check if a smaller company ☐ company ☐reporting company)
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨☐ No ý☒
The total number of shares of common stock, par value $.01 per share, outstanding as of April 22, 201924, 2020 was 18,529,563.20,333,024. The Registrant has no other class of common stock outstanding.
SEACOR HOLDINGS INC.
Table of Contents
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Part I. | | | |
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Part I. | Item 1. | | |
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| Item 1. | | |
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| Item 2. | | |
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| Item 3. | | |
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| Item 4. | | |
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Part II. | | | |
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| Item 1. | | |
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| Item 1A. | | |
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| Item 2. | | |
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| Item 3. | | |
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| Item 4. | | |
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| Item 5. | | |
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| Item 6. | | |
PART I—I - FINANCIAL INFORMATION
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ITEM 1. | FINANCIAL STATEMENTS |
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share data, unaudited) |
| | | | | | | |
| March 31, 2019 | | December 31, 2018 |
ASSETS | | | |
Current Assets: | | | |
Cash and cash equivalents | $ | 141,152 |
| | $ | 144,221 |
|
Restricted cash and restricted cash equivalents | 2,992 |
| | 2,991 |
|
Marketable securities | 33,384 |
| | 30,316 |
|
Receivables: | | | |
Trade, net of allowance for doubtful accounts of $3,618 and $3,481 in 2019 and 2018, respectively | 174,278 |
| | 171,828 |
|
Other | 32,635 |
| | 38,881 |
|
Inventories | 4,914 |
| | 4,530 |
|
Prepaid expenses and other | 5,809 |
| | 5,382 |
|
Total current assets | 395,164 |
| | 398,149 |
|
Property and Equipment: | | | |
Historical cost | 1,413,488 |
| | 1,407,329 |
|
Accumulated depreciation | (577,136 | ) | | (560,819 | ) |
Net property and equipment | 836,352 |
| | 846,510 |
|
Operating Lease Right-of-Use Assets | 167,325 |
| | — |
|
Investments, at Equity, and Advances to 50% or Less Owned Companies | 155,290 |
| | 156,886 |
|
Construction Reserve Funds | 3,908 |
| | 3,908 |
|
Goodwill | 32,720 |
| | 32,708 |
|
Intangible Assets, Net | 23,662 |
| | 24,551 |
|
Other Assets | 7,385 |
| | 8,312 |
|
| $ | 1,621,806 |
| | $ | 1,471,024 |
|
LIABILITIES AND EQUITY | | | |
Current Liabilities: | | | |
Current portion of long-term debt | $ | 8,308 |
| | $ | 8,497 |
|
Current portion of long-term operating lease liabilities | 35,540 |
| | — |
|
Accounts payable and accrued expenses | 50,097 |
| | 59,607 |
|
Other current liabilities | 67,456 |
| | 55,659 |
|
Total current liabilities | 161,401 |
| | 123,763 |
|
Long-Term Debt | 315,303 |
| | 346,128 |
|
Long-Term Operating Lease Liabilities | 131,862 |
| | — |
|
Deferred Income Taxes | 97,758 |
| | 94,420 |
|
Deferred Gains and Other Liabilities | 20,688 |
| | 52,871 |
|
Total liabilities | 727,012 |
| | 617,182 |
|
Equity: | | | |
SEACOR Holdings Inc. stockholders’ equity: | | | |
Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued nor outstanding | — |
| | — |
|
Common stock, $.01 par value, 60,000,000 shares authorized; 39,185,231 and 39,001,924 shares issued in 2019 and 2018, respectively | 392 |
| | 390 |
|
Additional paid-in capital | 1,598,804 |
| | 1,596,642 |
|
Retained earnings | 498,065 |
| | 474,809 |
|
Shares held in treasury of 20,657,171 and 20,671,627 in 2019 and 2018, respectively, at cost | (1,366,267 | ) | | (1,366,773 | ) |
Accumulated other comprehensive loss, net of tax | (903 | ) | | (914 | ) |
| 730,091 |
| | 704,154 |
|
Noncontrolling interests in subsidiaries | 164,703 |
| | 149,688 |
|
Total equity | 894,794 |
| | 853,842 |
|
| $ | 1,621,806 |
| | $ | 1,471,024 |
|
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data, unaudited)
| | | | | | | | | | | |
| March 31, 2020 | | December 31, 2019 |
ASSETS | | | |
Current Assets: | | | |
Cash and cash equivalents | $ | 76,106 | | | $ | 77,222 | |
Restricted cash and restricted cash equivalents | 1,224 | | | 1,222 | |
Marketable securities | 7,832 | | | 7,936 | |
Receivables: | | | |
Trade, net of allowance for doubtful accounts of $2,898 and $2,871 in 2020 and 2019, respectively | 192,350 | | | 194,022 | |
Other | 67,938 | | | 38,881 | |
Inventories | 4,050 | | | 5,255 | |
Prepaid expenses and other | 5,387 | | | 6,971 | |
| | | |
Total current assets | 354,887 | | | 331,509 | |
Property and Equipment: | | | |
Historical cost | 1,441,509 | | | 1,442,382 | |
Accumulated depreciation | (639,424) | | | (624,024) | |
| | | |
| | | |
Net property and equipment | 802,085 | | | 818,358 | |
Operating Lease Right-of-Use Assets | 136,180 | | | 144,539 | |
Investments, at Equity, and Advances to 50% or Less Owned Companies | 151,568 | | | 157,108 | |
| | | |
Goodwill | 32,586 | | | 32,701 | |
Intangible Assets, Net | 22,952 | | | 20,996 | |
Other Assets | 8,615 | | | 7,761 | |
| | | |
| $ | 1,508,873 | | | $ | 1,512,972 | |
LIABILITIES AND EQUITY | | | |
Current Liabilities: | | | |
Current portion of long-term debt | $ | 44,495 | | | $ | 58,854 | |
Current portion of long-term operating lease liabilities | 35,258 | | | 36,011 | |
| | | |
Accounts payable and accrued expenses | 43,663 | | | 57,595 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
Other current liabilities | 75,225 | | | 57,501 | |
| | | |
Total current liabilities | 198,641 | | | 209,961 | |
Long-Term Debt | 254,272 | | | 255,612 | |
Long-Term Operating Lease Liabilities | 100,789 | | | 108,295 | |
| | | |
Deferred Income Taxes | 123,054 | | | 105,661 | |
Deferred Gains and Other Liabilities | 19,103 | | | 20,929 | |
| | | |
Total liabilities | 695,859 | | | 700,458 | |
Equity: | | | |
SEACOR Holdings Inc. stockholders’ equity: | | | |
Preferred stock, $0.01 par value, 10,000,000 shares authorized; none issued nor outstanding | — | | | — | |
Common stock, $0.01 par value, 60,000,000 shares authorized; 41,005,575 and 40,819,892 shares issued in 2020 and 2019, respectively | 410 | | | 408 | |
Additional paid-in capital | 1,662,938 | | | 1,661,002 | |
Retained earnings | 518,573 | | | 517,106 | |
Shares held in treasury of 20,672,551 and 20,643,724 in 2020 and 2019, respectively, at cost | (1,366,787) | | | (1,365,792) | |
Accumulated other comprehensive loss, net of tax | (2,909) | | | (998) | |
| 812,225 | | | 811,726 | |
Noncontrolling interests in subsidiaries | 789 | | | 788 | |
Total equity | 813,014 | | | 812,514 | |
| $ | 1,508,873 | | | $ | 1,512,972 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
and should be read in conjunction herewith.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except share data, unaudited) |
| | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
Operating Revenues | $ | 209,524 |
| | $ | 184,824 |
|
Costs and Expenses: | | | |
Operating | 147,111 |
| | 131,777 |
|
Administrative and general | 26,746 |
| | 25,795 |
|
Depreciation and amortization | 17,136 |
| | 19,609 |
|
| 190,993 |
| | 177,181 |
|
Gains on Asset Dispositions | 437 |
| | 7,045 |
|
Operating Income | 18,968 |
| | 14,688 |
|
Other Income (Expense): | | | |
Interest income | 1,900 |
| | 1,856 |
|
Interest expense | (5,113 | ) | | (8,563 | ) |
Debt extinguishment losses | (793 | ) | | (42 | ) |
Marketable security gains (losses), net | 3,068 |
| | (3,798 | ) |
Foreign currency gains, net | 405 |
| | 1,690 |
|
Other, net | (644 | ) | | 283 |
|
| (1,177 | ) | | (8,574 | ) |
Income Before Income Tax Expense (Benefit) and Equity in Losses of 50% or Less Owned Companies | 17,791 |
| | 6,114 |
|
Income Tax Expense (Benefit) | 2,205 |
| | (281 | ) |
Income Before Equity in Losses of 50% or Less Owned Companies | 15,586 |
| | 6,395 |
|
Equity in Losses of 50% or Less Owned Companies, Net of Tax | (2,518 | ) | | (837 | ) |
Net Income | 13,068 |
| | 5,558 |
|
Net Income attributable to Noncontrolling Interests in Subsidiaries | 5,335 |
| | 4,917 |
|
Net Income attributable to SEACOR Holdings Inc. | $ | 7,733 |
| | $ | 641 |
|
| | |
Basic Earnings Per Common Share of SEACOR Holdings Inc. | $ | 0.42 |
| | $ | 0.04 |
|
| | |
Diluted Earnings Per Common Share of SEACOR Holdings Inc. | $ | 0.41 |
| | $ | 0.04 |
|
| | | |
Weighted Average Common Shares Outstanding: | | | |
Basic | 18,232,562 |
| | 17,969,970 |
|
Diluted | 19,571,339 |
| | 18,178,518 |
|
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share data, unaudited)
| | | | | | | | | | | | | | | |
| | | | | Three Months Ended March 31, | | |
| | | | | 2020 | | 2019 |
Operating Revenues | | | | | $ | 192,296 | | | $ | 209,524 | |
Costs and Expenses: | | | | | | | |
Operating | | | | | 146,028 | | | 147,111 | |
Administrative and general | | | | | 29,021 | | | 26,746 | |
Depreciation and amortization | | | | | 17,729 | | | 17,136 | |
| | | | | 192,778 | | | 190,993 | |
Gains on Asset Dispositions, Net | | | | | 384 | | | 437 | |
Operating Income (Loss) | | | | | (98) | | | 18,968 | |
Other Income (Expense): | | | | | | | |
Interest income | | | | | 1,601 | | | 1,900 | |
Interest expense | | | | | (4,470) | | | (5,113) | |
Debt extinguishment losses | | | | | (319) | | | (793) | |
Marketable security gains (losses), net | | | | | (104) | | | 3,068 | |
| | | | | | | |
Foreign currency gains (losses), net | | | | | (4,582) | | | 405 | |
Other, net | | | | | 92 | | | (644) | |
| | | | | (7,782) | | | (1,177) | |
Income (Loss) Before Income Tax Expense (Benefit) and Equity in Losses of 50% or Less Owned Companies | | | | | (7,880) | | | 17,791 | |
Income Tax Expense (Benefit) | | | | | (14,142) | | | 2,205 | |
Income Before Equity in Losses of 50% or Less Owned Companies | | | | | 6,262 | | | 15,586 | |
Equity in Losses of 50% or Less Owned Companies, Net of Tax | | | | | (4,793) | | | (2,518) | |
Net Income | | | | | 1,469 | | | 13,068 | |
Net Income Attributable to Noncontrolling Interests in Subsidiaries | | | | | 2 | | | 5,335 | |
Net Income Attributable to SEACOR Holdings Inc. | | | | | $ | 1,467 | | | $ | 7,733 | |
| | | | | | | |
Basic Earnings Per Common Share of SEACOR Holdings Inc. | | | | | $ | 0.07 | | | $ | 0.42 | |
| | | | | | | |
Diluted Earnings Per Common Share of SEACOR Holdings Inc. | | | | | $ | 0.07 | | | $ | 0.41 | |
| | | | | | | |
Weighted Average Common Shares Outstanding: | | | | | | | |
Basic | | | | | 19,950,444 | | | 18,232,562 | |
Diluted | | | | | 19,994,025 | | | 19,571,339 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
and should be read in conjunction herewith.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands, unaudited) |
| | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
Net Income | $ | 13,068 |
| | $ | 5,558 |
|
Other Comprehensive Income: | | | |
Foreign currency translation gains | 79 |
| | 644 |
|
Income tax expense | (68 | ) | | (3 | ) |
| 11 |
| | 641 |
|
Comprehensive Income | 13,079 |
| | 6,199 |
|
Comprehensive Income attributable to Noncontrolling Interests in Subsidiaries | 5,335 |
| | 4,917 |
|
Comprehensive Income attributable to SEACOR Holdings Inc. | $ | 7,744 |
| | $ | 1,282 |
|
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, unaudited)
| | | | | | | | | | | | | | | |
| | | | | Three Months Ended March 31, | | |
| | | | | 2020 | | 2019 |
Net Income | | | | | $ | 1,469 | | | $ | 13,068 | |
Other Comprehensive Income (Loss): | | | | | | | |
Foreign currency translation gains (losses), net | | | | | (996) | | | 79 | |
| | | | | | | |
Derivative losses on cash flow hedges | | | | | (918) | | | — | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | (1,914) | | | 79 | |
Income tax benefit (expense) | | | | | 3 | | | (68) | |
| | | | | (1,911) | | | 11 | |
Comprehensive Income | | | | | (442) | | | 13,079 | |
Comprehensive Income Attributable to Noncontrolling Interests in Subsidiaries | | | | | 2 | | | 5,335 | |
Comprehensive Income Attributable to SEACOR Holdings Inc. | | | | | $ | (444) | | | $ | 7,744 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
and should be read in conjunction herewith.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (in thousands, unaudited) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| SEACOR Holdings Inc. Stockholders’ Equity | | Non- Controlling Interests In Subsidiaries | | Total Equity |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Treasury Stock | | Accumulated Other Comprehensive Loss | |
December 31, 2018 | $ | 390 |
| | $ | 1,596,642 |
| | $ | 474,809 |
| | $ | (1,366,773 | ) | | $ | (914 | ) | | $ | 149,688 |
| | $ | 853,842 |
|
Impact of adoption of accounting principle, net of tax | — |
| | — |
| | 15,523 |
| | — |
| | — |
| | 9,836 |
| | 25,359 |
|
December 31, 2018, As Adjusted | 390 |
| | 1,596,642 |
| | 490,332 |
| | (1,366,773 | ) | | (914 | ) | | 159,524 |
| | 879,201 |
|
Issuance of common stock: | | | | | | | | | | | | | |
Employee Stock Purchase Plan | — |
| | — |
| | — |
| | 857 |
| | — |
| | — |
| | 857 |
|
Exercise of stock options | — |
| | 873 |
| | — |
| | — |
| | — |
| | — |
| | 873 |
|
Director stock awards | — |
| | 33 |
| | — |
| | — |
| | — |
| | — |
| | 33 |
|
Restricted stock | 2 |
| | (2 | ) | | — |
| | — |
| | — |
| | — |
| | — |
|
Purchase of treasury shares | — |
| | — |
| | — |
| | (351 | ) | | — |
| | — |
| | (351 | ) |
Amortization of share awards | — |
| | 1,258 |
| | — |
| | — |
| | — |
| | — |
| | 1,258 |
|
Distributions to noncontrolling interests | — |
| | — |
| | — |
| | — |
| | — |
| | (156 | ) | | (156 | ) |
Net income | — |
| | — |
| | 7,733 |
| | — |
| | — |
| | 5,335 |
| | 13,068 |
|
Other comprehensive income | — |
| | — |
| | — |
| | — |
| | 11 |
| | — |
| | 11 |
|
March 31, 2019 | $ | 392 |
| | $ | 1,598,804 |
| | $ | 498,065 |
| | $ | (1,366,267 | ) | | $ | (903 | ) | | $ | 164,703 |
| | $ | 894,794 |
|
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in thousands, unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| SEACOR Holdings Inc. Stockholders’ Equity | | | | | | | | | | Non- Controlling Interests In Subsidiaries | | Total Equity |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Treasury Stock | | Accumulated Other Comprehensive Loss | | | | |
December 31, 2019 | $ | 408 | | | $ | 1,661,002 | | | $ | 517,106 | | | $ | (1,365,792) | | | $ | (998) | | | $ | 788 | | | $ | 812,514 | |
Issuance of common stock: | | | | | | | | | | | | | |
Employee Stock Purchase Plan | — | | | — | | | — | | | 949 | | | — | | | — | | | 949 | |
Exercise of stock options | — | | | 421 | | | — | | | — | | | — | | | — | | | 421 | |
Director stock awards | — | | | 21 | | | — | | | — | | | — | | | — | | | 21 | |
Restricted stock | 2 | | | (2) | | | — | | | — | | | — | | | — | | | — | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Purchase of treasury shares | — | | | — | | | — | | | (1,944) | | | — | | | — | | | (1,944) | |
Amortization of share awards | — | | | 1,496 | | | — | | | — | | | — | | | — | | | 1,496 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Distributions to noncontrolling interests | — | | | — | | | — | | | — | | | — | | | (1) | | | (1) | |
Net income | — | | | — | | | 1,467 | | | — | | | — | | | 2 | | | 1,469 | |
Other comprehensive loss | — | | | — | | | — | | | — | | | (1,911) | | | — | | | (1,911) | |
March 31, 2020 | $ | 410 | | | $ | 1,662,938 | | | $ | 518,573 | | | $ | (1,366,787) | | | $ | (2,909) | | | $ | 789 | | | $ | 813,014 | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| SEACOR Holdings Inc. Stockholders’ Equity | | Non- Controlling Interests In Subsidiaries | | Total Equity |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Treasury Stock | | Accumulated Other Comprehensive Income (Loss) | |
December 31, 2017 | $ | 387 |
| | $ | 1,573,013 |
| | $ | 419,128 |
| | $ | (1,368,300 | ) | | $ | (545 | ) | | $ | 129,678 |
| | $ | 753,361 |
|
Impact of adoption of accounting principle | — |
| | — |
| | (2,467 | ) | | — |
| | — |
| | — |
| | (2,467 | ) |
December 31, 2017, As Adjusted | 387 |
| | 1,573,013 |
| | 416,661 |
| | (1,368,300 | ) | | (545 | ) | | 129,678 |
| | 750,894 |
|
Issuance of common stock: | | | | | | | | | | | | | |
Employee Stock Purchase Plan | — |
| | — |
| | — |
| | 867 |
| | — |
| | — |
| | 867 |
|
Exercise of stock options | 1 |
| | 2,727 |
| | — |
| | — |
| | — |
| | — |
| | 2,728 |
|
Director stock awards | — |
| | 20 |
| | — |
| | — |
| | — |
| | — |
| | 20 |
|
Restricted stock | 1 |
| | (1 | ) | | — |
| | — |
| | — |
| | — |
| | — |
|
Amortization of share awards | — |
| | 898 |
| | — |
| | — |
| | — |
| | — |
| | 898 |
|
Distributions to noncontrolling interests | — |
| | — |
| | — |
| | — |
| | — |
| | (132 | ) | | (132 | ) |
Net income | — |
| | — |
| | 641 |
| | — |
| | — |
| | 4,917 |
| | 5,558 |
|
Other comprehensive income | — |
| | — |
| | — |
| | — |
| | 641 |
| | — |
| | 641 |
|
March 31, 2018 | $ | 389 |
| | $ | 1,576,657 |
| | $ | 417,302 |
| | $ | (1,367,433 | ) | | $ | 96 |
| | $ | 134,463 |
| | $ | 761,474 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| SEACOR Holdings Inc. Stockholders’ Equity | | | | | | | | | | Non- Controlling Interests In Subsidiaries | | Total Equity |
| Common Stock | | Additional Paid-In Capital | | Retained Earnings | | Treasury Stock | | Accumulated Other Comprehensive Income (Loss) | | | | |
December 31, 2018 | $ | 390 | | | $ | 1,596,642 | | | $ | 474,809 | | | $ | (1,366,773) | | | $ | (914) | | | $ | 149,688 | | | $ | 853,842 | |
Impact of adoption of accounting principle, net of tax | — | | | — | | | 15,523 | | | — | | | — | | | 9,836 | | | 25,359 | |
December 31, 2018, As Adjusted | 390 | | | 1,596,642 | | | 490,332 | | | (1,366,773) | | | (914) | | | 159,524 | | | 879,201 | |
Issuance of common stock: | | | | | | | | | | | | | |
Employee Stock Purchase Plan | — | | | — | | | — | | | 857 | | | — | | | — | | | 857 | |
Exercise of stock options | — | | | 873 | | | — | | | — | | | — | | | — | | | 873 | |
Director stock awards | — | | | 33 | | | — | | | — | | | — | | | — | | | 33 | |
Restricted stock | 2 | | | (2) | | | — | | | — | | | — | | | — | | | — | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Purchase of treasury shares | — | | | — | | | — | | | (351) | | | — | | | — | | | (351) | |
Amortization of share awards | — | | | 1,258 | | | — | | | — | | | — | | | — | | | 1,258 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Distributions to noncontrolling interests | — | | | — | | | — | | | — | | | — | | | (156) | | | (156) | |
Net income | — | | | — | | | 7,733 | | | — | | | — | | | 5,335 | | | 13,068 | |
Other comprehensive income | — | | | — | | | — | | | — | | | 11 | | | — | | | 11 | |
March 31, 2019 | $ | 392 | | | $ | 1,598,804 | | | $ | 498,065 | | | $ | (1,366,267) | | | $ | (903) | | | $ | 164,703 | | | $ | 894,794 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
and should be read in conjunction herewith.
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, unaudited) |
| | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
Net Cash Provided by Operating Activities | $ | 34,660 |
| | $ | 12,907 |
|
Cash Flows from Investing Activities: | | | |
Purchases of property and equipment | (5,649 | ) | | (9,542 | ) |
Proceeds from disposition of property and equipment | 120 |
| | 15,852 |
|
Investments in and advances to 50% or less owned companies | — |
| | (900 | ) |
Return of investments and advances from 50% or less owned companies | — |
| | 4,772 |
|
Payments received on third-party leases and notes receivable, net | 165 |
| | 150 |
|
Withdrawals from construction reserve funds | — |
| | 14,549 |
|
Business acquisitions, net of cash acquired | — |
| | 79 |
|
Net cash provided by (used in) investing activities | (5,364 | ) | | 24,960 |
|
Cash Flows from Financing Activities: | | | |
Payments on long-term debt | (31,396 | ) | | (8,071 | ) |
Payments for long-term debt issue costs | (2,197 | ) | | — |
|
Common stock acquired for treasury | (351 | ) | | — |
|
Proceeds from share award plans | 1,730 |
| | 3,595 |
|
Distributions to noncontrolling interests | (156 | ) | | (132 | ) |
Net cash used in financing activities | (32,370 | ) | | (4,608 | ) |
Effects of Exchange Rate Changes on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 6 |
| | 17 |
|
Net Increase (Decrease) in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (3,068 | ) | | 33,276 |
|
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Beginning of Period | 147,212 |
| | 242,228 |
|
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, End of Period | 144,144 |
| | 275,504 |
|
Restricted Cash and Restricted Cash Equivalents, End of Period | 2,992 |
| | 2,982 |
|
Cash and Cash Equivalents, End of Period | $ | 141,152 |
| | $ | 272,522 |
|
SEACOR HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, unaudited)
| | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2020 | | 2019 |
Net Cash Provided by Operating Activities | $ | 25,002 | | | $ | 34,660 | |
Cash Flows from Investing Activities: | | | |
Purchases of property and equipment | (6,377) | | | (5,649) | |
| | | |
Proceeds from disposition of property and equipment | 114 | | | 120 | |
| | | |
| | | |
| | | |
| | | |
Payments received on third-party leases and notes receivable, net | 15 | | | 165 | |
| | | |
| | | |
Business acquisitions, net of cash acquired | (970) | | | — | |
Net cash used in investing activities | (7,218) | | | (5,364) | |
Cash Flows from Financing Activities: | | | |
Payments on long-term debt | (18,144) | | | (31,396) | |
| | | |
| | | |
Payments for long-term debt issue costs | — | | | (2,197) | |
| | | |
Common stock acquired for treasury | (1,944) | | | (351) | |
Proceeds from share award plans | 1,370 | | | 1,730 | |
| | | |
| | | |
Distributions to noncontrolling interests | (1) | | | (156) | |
Net cash used in financing activities | (18,719) | | | (32,370) | |
Effects of Exchange Rate Changes on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (179) | | | 6 | |
Net Decrease in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (1,114) | | | (3,068) | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Beginning of Period | 78,444 | | | 147,212 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, End of Period | 77,330 | | | 144,144 | |
Restricted Cash and Restricted Cash Equivalents, End of Period | 1,224 | | | 2,992 | |
Cash and Cash Equivalents, End of Period | $ | 76,106 | | | $ | 141,152 | |
The accompanying notes are an integral part of these condensed consolidated financial statements
and should be read in conjunction herewith.
SEACOR HOLDINGS INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES
Unless the context otherwise indicates, any reference in this Quarterly Report on Form 10-Q to the “Company” refers to SEACOR Holdings Inc. and its consolidated subsidiaries and any reference in this Quarterly Report on Form 10-Q to “SEACOR” refers to SEACOR Holdings Inc. without its consolidated subsidiaries. Capitalized terms used and not specifically defined herein have the same meaning given those terms in the Company's Annual report on Form 10-K for the year ended December 31, 2018.2019.
The condensed consolidated financial information for the three months ended March 31, 20192020 and 20182019 has been prepared by the Company and has not been audited by its independent registered certified public accounting firm. The condensed consolidated financial statements include the accounts of SEACOR Holdings Inc. and its consolidated subsidiaries. In the opinion of management, all adjustments (consisting of normal recurring adjustments) have been made to fairly present the Company’s financial position as of March 31, 2019,2020, its results of operations for the three months ended March 31, 20192020 and 2018,2019, its comprehensive income for the three months ended March 31, 20192020 and 2018,2019, its changes in equity for the three months ended March 31, 20192020 and 2018,2019, and its cash flows for the three months ended March 31, 20192020 and 2018.2019. Results of operations for the interim periods presented are not necessarily indicative of operating results for the full year or any future periods.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.2019.
Adoption of New Accounting Standards.On January 1, 2019,2020, the Company adopted Financial Accounting Standards Board (“FASB”) Topic 326, Financial Instruments - Credit Losses (“Topic 326”), which replaces the current incurred loss impairment methodology for financial assets and other assets measured at amortized cost with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information, including forecasted information, to develop credit loss estimates. As part of our assessment of the adequacy of our allowances for credit losses, we considered a number of factors including, but not limited to, customer credit ratings and payment history, bankruptcy filings, published or estimated credit default rates, age of receivables, expected loss rates and collateral exposures. The adoption of Topic 326 using a modified retrospective approach did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.
On January 1, 2019, the Company adopted FASB Topic 842, Leases (“Topic 842”) using a modified prospective approach and implemented internal controls and systems to enable the preparation of financial information upon adoption. The Company elected the available practical expedients permitted under the guidance including the option to not separate lease and nonlease components in calculating the right-of useright-of-use assets and corresponding lease liabilities and to not apply the recognition requirements of Topic 842 to short-term leases (leases that have a duration of twelve months or less at lease inception). Generally, it was not possible for the Company to determine the interest rate implicit in each of its operating leases and therefore used its incremental borrowing rate in calculating operating lease right-of-use assets and lease liabilities. The Company assigned its leases to portfolios based on the remaining term at the time of adoption and applied a single rate to each portfolio of leases as the result was not materially different than using a specific discount rate for each individual lease. The Company included renewal options that were reasonably certain of being exercised in determining the lease term. Upon adoption, the Company recorded operating lease right-of-use assets and lease liabilities of $174.6 million for certain of its equipment, office and land leases (see Note 5). In addition, the Company recognized a cumulative-effect adjustment of $25.4 million, net of tax, to the opening balance of retained earnings primarily for previously deferred gains related to sale leasebacksale-leaseback transactions.
On January 1, 2018, the Company adopted ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory, which eliminates the deferral of the tax effects of intercompany asset sales other than inventory until the transferred assets are sold to a third party or recovered through use. As a result of the adoption of the standard, the deferred tax charges previously recognized from those sales resulted in a decrease in deferred tax assets and a cumulative adjustment to retained earnings of $2.5 million in the consolidated balance sheets and statements of changes in equity as of January 1, 2018.
Revenue Recognition.The Company earns revenues from contracts with customers and from lease contracts.
Revenue from Contracts with Customers. Revenue is recognized when (or as) the Company transfers promised goods or services to its customers in amounts that reflect the consideration to which the Company expects to be entitled to in exchange for those goods or services, which occurs when (or as) the Company satisfies its contractual obligations and transfers control of the promised goods or services to its customers. Costs to obtain or fulfill a contract are expensed as incurred.
Revenue
Ocean Services' revenues from Contractscontracts with Customers. Ocean Servicescustomers primarily earns revenuesarise from voyage charters, contracts of affreightment, tariff based port and infrastructure services, unit freight logistics services, and technical ship management agreements with vessel owners (see Note 12)15). Ocean Services transfers control of the service to the customer and satisfies its performance obligation over the term of the contract, and therefore recognizes revenue over the term of the contract while related costs are expensed as incurred. Voyage charters are contracts to carry cargoes on a single voyage basis for a predetermined price, regardless of time to complete. Contracts of affreightment are contracts for cargoes that are committed on a multi-voyage basis for various periods of time, with minimum and maximum cargo tonnages specified over the period at a fixed or escalating rate per ton. Tariff based port and infrastructure services typically include operating harbor tugs alongside oceangoing vessels to escort them to their berth, assisting with the docking and undocking of these oceangoing vessels and escorting them back out to sea. They are contracted using prevailing port tariff terms on a per-use basis. In the unit freight logistics trade, transportation services typically include transporting shipping containers, rail cars, project cargoes, automobiles and U.S. military vehicles and are generally contracted
on a per unit basis for the specified cargo and destination, typically in accordance with a publicly available tariff rate or based on a negotiated rate when moving larger volumes over an extended period. Managed services include technical ship and crew management agreements whereby Ocean Services provides technical ship and crew management services to third-party customers for a predetermined price over a specified period of time, typically a year or more.
Inland ServicesServices' revenues from contracts with customers primarily earns revenuesarise from contracts of affreightment, terminal operations, fleeting operations and repair and maintenance services (see Note 12)15). Inland Services transfers control of the service to the customer and satisfies its performance obligation over the term of the contract, and therefore recognizes revenue over the term of the contract while related costs are expensed as incurred. Contracts of affreightment are contracts whereby customers are charged an established rate per ton to transport cargo from point-to-point. Terminal operations includes tank farms and dry bulk and container handling facilities that are marketed under contractual rates and terms driven by throughput volume. Fleeting operations includes fleeting services whereby barges are held in fleeting areas for an agreed-upon day rate and shifting services whereby harbor boats are used to pick up and drop off barges to assist in assembling tows and to move barges to and from the dock for loading and unloading at predetermined per-shift fees. Other operations primarily include a machine shop specializing in towboat and barge cleaning, repair and maintenance services that are charged on an hourly or a fixed fee basis depending on the scope and nature of the work.
Witt O’Brien’s revenues from contracts with customers primarily earns revenuesarise from time and material and retainer contracts (see Note 12)15). Witt O’Brien’s transfers control of the service to the customer and satisfies its performance obligation over the term of the contract, and therefore recognizes revenue over the term of the contract while related costs are expensed as incurred. Time and material contracts primarily relate to emergency response, debris management or consulting services that Witt O’Brien’s performs for a predetermined fee. Retainer contracts, which are nearly all with vessel services operators and oil companies, are contracted based on agreed-upon rates.
The Company’s Other business segment includes CLEANCOR Energy Solutions LLC and its subsidiaries (collectively “Cleancor”),Cleancor, which primarily earns revenues from the sale of liquefied natural gas (see Note 12)15). Under these arrangements, control of the goods are transferred to the customer and performance obligations are satisfied at a point in time, and therefore revenue is recognized upon delivery while any related costs are expensed as incurred.
Contract liabilities from contracts with customers arise when the Company has received consideration prior to performance and are included in other current liabilities in the accompanying condensed consolidated balance sheets. The Company’s contract liability activity for the three months ended March 31 was as follows (in thousands):
| | | | | | | | | | | | | |
| 2020 | | 2019 | | |
Balance at beginning of period | $ | 794 | | | $ | 968 | | | |
Previously deferred revenues recognized upon completion of performance obligations during the period | (394) | | | (408) | | | |
Net contract liabilities arising during the period | 7,504 | | | 7,351 | | | |
Balance at end of period | $ | 7,904 | | | $ | 7,911 | | | |
|
| | | |
| 2019 |
Balance at beginning of period | $ | 968 |
|
Contract liabilities arising during the period | 7,351 |
|
Revenue recognized upon completion of performance obligations during the period | (408 | ) |
Balance at end of period | $ | 7,911 |
|
Lease Revenues. The Company’s lease revenues are primarily from time charters, bareboat charters and non-vessel rental arrangements. The Company accounts for these leases as operating leases. The lease terms are included in the charter and rental arrangements, and the determination of whether those arrangements contain a lease generally does not require significant assumptions or judgments. The Company’s lease revenues do not include material amounts of variable payments andagreements that are recognized ratably over the lease term as services are provided, typically on a per day basis.
Under a time charter, the Company provides a vessel to a customer for a set term and is responsible for all operating expenses, typically excluding fuel. The non-lease components included in time charter rates are typically crewing, maintenance and insurance for the vessel over the term of the lease. Under a bareboat charter, the Company provides a vessel to a customer for a set term and the customer assumes responsibility for all operating expenses and risks of operation. Under a non-vessel rental arrangements,agreement, the Company provides non-vessel property or equipment to a customer for a set term and the customer assumes responsibility for all operating expenses and risks of operation. There are no non-lease components for bareboat charters and non-vessel rental arrangements.
Lease revenues are generated from owned equipment as well as equipment that is leased-in from other equipment owners or financial institutions. Lease revenues from equipment that is leased-in are included in sublease income for the Company’s lessee disclosures (see Note 5). The Company’s leases generally do not provide an option for customers to purchase the leased equipment and lessees do not provide residual value guarantees. The Company expects to derive significant benefits from its equipment following the end
Property and Equipment. Equipment, stated at cost, is depreciated using the straight-line method over the estimated useful life of the asset to an estimated salvage value. With respect to each class of asset, the estimated useful life is based upon a newly built asset being placed into service and represents the time period beyond which it is typically not justifiable for the Company to continue to operate the asset in the same or similar manner. From time to time, the Company may acquire older assets
that have already exceeded their useful life as set forth in the Company’s useful life policy, in which case the Company depreciates such assets based on its best estimate of remaining useful life, typically the next survey or certification date.
As of March 31, 2019,2020, the estimated useful life (in years) of each of the Company’s major categories of new equipment was as follows:
|
| | | | |
Petroleum and chemical carriers - U.S.-flag | 25 |
Bulk carriers - U.S.-flag | 25 |
Harbor and offshore tugs | 25 |
Ocean liquid tank barges | 25 |
Short-sea container/RORO(1) vessels | 20 |
Inland river dry-cargo and specialty barges | 20 |
Inland river liquid tank barges | 25 |
Inland river towboats and harbor boats | 25 |
Terminal and fleeting facilities | 20 |
______________________
(1)Roll On/Roll Off.
Equipment maintenance and repair costs including the costs of routine overhauls, dry-dockings and inspections performed on vessels and equipment are charged to operating expense as incurred. Expenditures that extend the useful life or improve the marketing and commercial characteristics of equipment as well as major renewals and improvements to other properties are capitalized.
As of March 31, 2019,2020, the Company’sCompany had construction in progress totaling $9.6of $15.0 million that primarily consisted of the construction of harbor tugs and upgrades to inland river towboats, and the construction of other Inland Services equipment, and is included in historical cost in the accompanying condensed consolidated balance sheets. Certain interest costs incurred during the construction of equipment are capitalized as part of the assets’ carrying values and are amortized over such assets’ estimated useful lives. During the three months ended March 31, 2019, the amount of2020, capitalized interest was not material.
Impairment. In March 2020, the World Health Organization declared the outbreak of a novel coronavirus ("COVID-19") as a pandemic, which continues to spread throughout the United States and the world. The spread of COVID-19 has caused significant volatility in U.S. and international markets and there is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies.
The Company's overall business, results of operations and financial condition have not been materially affected by the COVID-19 outbreak. The COVID-19 pandemic is, however, a dynamic and continuously evolving phenomenon and the ultimate severity of the outbreak is uncertain at this time. If the pandemic worsens, additional restrictions are implemented or current restrictions are imposed for a longer period of time to contain the outbreak, the Company may experience a material adverse effect on its businesses, results of operations and financial condition, which could result in impairments in future periods.
Impairment of Long-Lived Assets. The Company performs an impairment analysis of long-lived assets used in operations, including intangible assets, when indicators of impairment are present. These indicators may include a significant decrease in the market price of a long-lived asset or asset group, a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition, or a current period operating or cash flow loss combined with a history of operating or cash flow losses or a forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group. If the carrying values of the assets are not recoverable, as determined by the estimated undiscounted cash flows, the estimated fair value of the assets or asset groups are compared to their current carrying value and impairment charges are recorded if the carrying value exceeds fair value. The Company performs its testing on an asset or asset group basis. The Company’s estimates of undiscounted cash flows are highly subjective and actual results may vary from the Company’s estimates due to the uncertainty regarding projected financial performance. Generally, fair value is determined using valuation techniques, such as expected discounted cash flows or appraisals, as appropriate. During the three months ended March 31, 20192020 and 2018,2019, the Company did not recognize any impairment charges related to long-lived assets held for use.
Impairment of 50% or Less Owned Companies. Investments in 50% or less owned companies are reviewed periodically to assess whether there is an other-than-temporary decline in the carrying value of the investment. In its evaluation, the Company considers, among other items, recent and expected financial performance and returns, impairments recorded by the investee and the capital structure of the investee. When the Company determines the estimated fair value of an investment is below carrying value and the decline is other-than-temporary, the investment is written down to its estimated fair value. Actual results may vary from the Company’s estimates due to the uncertainty regarding projected financial performance, the severity and expected duration of declines in value and the available liquidity in the capital markets to support the continuing operations of the investee, among other factors. Although the Company believes its assumptions and estimates are reasonable, the investee’s actual performance compared with the estimates could produce different results and lead to additional impairment charges in future periods. During the three months ended March 31, 20192020 and 2018,2019, the Company did not recognize any impairment charges related to its 50% or less owned companies.
Income Taxes. During the three months ended March 31, 2020, the Company’s effective income tax rate of 179.5% was higher than the statutory rate primarily due to a pre-tax loss, a statutory change to the U.S. federal income tax code and losses subject to tonnage tax, partially offset by foreign sourced income not subject to U.S. tax (see Note 7). During the three months ended March 31, 2019, the Company’sCompany's effective income tax rate of 12.4% was lower than the statutory rate primarily due to foreign sourced income not subject to U.S. tax, taxestax not provided on income attributable to noncontrolling interests and income subject to tonnage tax, partially offset by foreign taxes not creditable against U.S. income tax (see Note 6).tax.
Deferred Gains. The Company has sold certain equipment to its 50% or less owned companies, entered into vessel sale-leaseback transactions with finance companies and provided seller financing on sales of its equipment to third parties and its 50% or less owned companies. A portion of the gains realized from these transactions were deferred and recorded in deferred gains and other liabilities in the accompanying condensed consolidated balance sheets. Deferred gain activity related to these transactions for the three months ended March 31 was as follows (in thousands):
| | | 2019 | | 2018 | | 2020 | | 2019 | |
Balance at beginning of period | $ | 43,664 |
| | $ | 72,453 |
| Balance at beginning of period | $ | 12,008 | | | $ | 43,664 | | |
| Impact of adoption of accounting principle(1) | (29,207 | ) | | — |
| Impact of adoption of accounting principle(1) | — | | | (29,207) | | |
Amortization of deferred gains included in operating expenses as a reduction to rental expense | — |
| | (2,557 | ) | |
Amortization of deferred gains included in gains on asset dispositions | (331 | ) | | (518 | ) | |
| Amortization of deferred gains included in gains on asset dispositions, net | | Amortization of deferred gains included in gains on asset dispositions, net | (331) | | | (331) | | |
| Balance at end of period | $ | 14,126 |
| | $ | 69,378 |
| Balance at end of period | $ | 11,677 | | | $ | 14,126 | | |
______________________
(1)On January 1, 2019, the Company adopted Topic 842 and reduced deferred gains associated with sale-leaseback transactions through a beginning period retained earnings adjustment.
| | | | | | | | | | | | | | | | | |
(1) | On January 1, 2019, the Company adopted Topic 842 and reduced deferred gains associated with sale-leaseback transactions through a beginning period retained earnings adjustment. |
Earnings Per Share. Basic earnings per common share of SEACOR is computed based on the weighted average number of common shares issued and outstanding during the relevant periods. Diluted earnings per common share of SEACOR is computed based on the weighted average number of common shares issued and outstanding plus the effect of potentially dilutive securities through the application of the treasury stock and if-converted methods. Dilutive securities for this purpose assumes restricted stock grants have vested, common shares have been issued pursuant to the exercise of outstanding stock options and common shares have been issued pursuant to the conversion of all outstanding convertible notes.
Computations of basic and diluted earnings per common share of SEACOR were as follows (in thousands, except share data):
| | | | | | | | | | | Three Months Ended March 31, | |
| Three Months Ended March 31, | | | Net Income Attributable to SEACOR | | Average O/S Shares | | Per Share |
| Net Income attributable to SEACOR | | Average O/S Shares | | Per Share | |
2019 | | | | | | |
2020 | | 2020 | | | | | | |
Basic Weighted Average Common Shares Outstanding | $ | 7,733 |
| | 18,232,562 |
| | $ | 0.42 |
| Basic Weighted Average Common Shares Outstanding | | $ | 1,467 | | | 19,950,444 | | | $ | 0.07 | |
Effect of Dilutive Securities: | | | | | | Effect of Dilutive Securities: | | | |
Options and Restricted Stock(1) | — |
| | 111,676 |
| | | Options and Restricted Stock(1) | | — | | | 43,581 | | |
Convertible Notes(2) | 318 |
| | 1,227,101 |
| | | Convertible Notes(2) | | — | | | — | | |
Diluted Weighted Average Common Shares Outstanding | $ | 8,051 |
| | 19,571,339 |
| | $ | 0.41 |
| Diluted Weighted Average Common Shares Outstanding | | $ | 1,467 | | | 19,994,025 | | | $ | 0.07 | |
2018 | | | | | | |
2019 | | 2019 | | | | | | |
Basic Weighted Average Common Shares Outstanding | $ | 641 |
| | 17,969,970 |
| | $ | 0.04 |
| Basic Weighted Average Common Shares Outstanding | | $ | 7,733 | | | 18,232,562 | | | $ | 0.42 | |
Effect of Dilutive Securities: | | | | | | Effect of Dilutive Securities: | | | |
Options and Restricted Stock(3) | — |
| | 208,548 |
| | | Options and Restricted Stock(3) | | — | | | 111,676 | | |
Convertible Notes(4) | — |
| | — |
| | | Convertible Notes(4) | | 318 | | | 1,227,101 | | |
Diluted Weighted Average Common Shares Outstanding | $ | 641 |
| | 18,178,518 |
| | $ | 0.04 |
| Diluted Weighted Average Common Shares Outstanding | | $ | 8,051 | | | 19,571,339 | | | $ | 0.41 | |
______________________
| |
(1) | For the three months ended March 31, 2019, diluted earnings per common share of SEACOR excluded 1,012,711 of certain share awards as the effect of their inclusion in the computation would be anti-dilutive. |
| |
(2) | For the three months ended March 31, 2019, diluted earnings per common share of SEACOR excluded 1,302,221 of common shares issuable pursuant to the Company’s 3.0% Convertible Senior Notes and 1,553,780 of common shares pursuant to the Company’s 3.25% Convertible Senior Notes as the effect of their inclusion in the computation would be anti-dilutive. |
| |
(3) | For the three months ended March 31, 2018, diluted earnings per common share of SEACOR excluded 503,459 of certain share awards as the effect of their inclusion in the computation would be anti-dilutive. |
| |
(4) | For the three months ended March 31, 2018, diluted earnings per common share of SEACOR excluded 1,227,101 of common shares issuable pursuant to the Company’s 2.5% Convertible Senior Notes and 2,895,516 of common shares issuable pursuant to the Company’s 3.0% Convertible Senior Notes as the effect of their inclusion in the computation would be anti-dilutive. |
(1)For the three months ended March 31, 2020, diluted earnings per common share of SEACOR excluded 1,576,797 of certain share awards as the effect of their inclusion in the computation would be anti-dilutive.
(2)For the three months ended March 31, 2020, diluted earnings per common share of SEACOR excluded 573,604 of common shares issuable pursuant to the Company’s 3.0% Convertible Senior Notes, 1,227,101 of common shares issuable pursuant to the Company’s 2.5% Convertible Senior Notes and 1,553,780 of common shares issuable pursuant to the Company’s 3.25% Convertible Senior Notes as the effect of their inclusion in the computation would be anti-dilutive.
(3)For the three months ended March 31, 2019, diluted earnings per common share of SEACOR excluded 1,012,711 of certain share awards as the effect of their inclusion in the computation would be anti-dilutive.
(4)For the three months ended March 31, 2019, diluted earnings per common share of SEACOR excluded 1,302,221 of common shares issuable pursuant to the Company’s 3.0% Convertible Senior Notes and 1,553,780 of common shares issuable pursuant to the Company’s 3.25% Convertible Senior Notes as the effect of their inclusion in the computation would be anti-dilutive.
New Accounting Pronouncements. On June 16, 2016, the FASB issued an amendment to the accounting standards, which replaces the current incurred loss impairment methodology for financial assets measured at amortized cost with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable
information, including forecasted information, to develop credit loss estimates. The new standard is effective for interim and annual periods beginning after December 15, 2019. Early adoption is permitted for annual periods beginning after December 15, 2018. The Company has not yet determined what impact, if any, the adoption of the new standard will have on its consolidated financial position, results of operations or cash flows.
On January 26, 2017, the FASB issued an amendment to the accounting standards whichthat simplified wording and removed step two of the goodwill impairment test. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform step two of the goodwill test. The new standard is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2020, with early adoption permitted for interim or annual goodwill impairment tests on testing dates after January 1, 2017. The Company has not yet determined what impact, if any, the adoption of the new standard will have on its consolidated financial position, results of operations or cash flows.
On December 18, 2019, the FASB issued an amendment to the accounting standards that enhances and simplifies various aspects of the income tax accounting guidance including the elimination of certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The guidance will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company has not yet determined what impact, if any, the adoption of the new standard will have on its consolidated financial position, results of operations or cash flows. 2. BUSINESS ACQUISITIONS
Navigate. On February 21, 2020, the Company acquired Helix Media Pte. Ltd., Navigate Response (Asia) Pte. Ltd., Navigate PR Ltd., and Navigate Response Limited (collectively "Navigate"), a global crisis communications network specializing in the international shipping, port and offshore industries, for $3.6 million. The purchase price consisted of $1.0 million, in cash net of cash acquired of $0.8 million, paid at the closing of the acquisition and $1.8 million of contingent consideration that is payable upon Navigate meeting certain specified cash collection and client retention targets for the 24 months following the acquisition date. The Company performed a preliminary fair value analysis and the purchase price was allocated to the acquired assets and liabilities based on their fair value resulting in no goodwill being recorded.
Purchase Price Allocation. The allocation of the purchase price for the Company’s acquisition for the three months ended March 31 was as follows (in thousands):
| | | | | |
| 2020 |
| |
Trade and other receivables | $ | 295 | |
Other current assets | 103 | |
| |
Property and Equipment | 5 | |
| |
Intangible Assets | 3,020 | |
| |
Accounts payable and other accrued liabilities | (31) | |
Other current liabilities(1) | (2,055) | |
| |
| |
Other Liabilities(1) | (367) | |
| |
| |
Purchase price(2) | $ | 970 | |
| |
______________________
(1)Includes contingent consideration.
(2)Purchase price is net of cash acquired totaling $0.8 million.
3. EQUIPMENT ACQUISITIONS AND DISPOSITIONS
During the three months ended March 31, 2019,2020, capital expenditures were $5.6$6.4 million and primarily related to the acquisitionconstruction of real property, upgrades to inland river towboatsharbor tugs and the constructionpurchase of other Inland Servicesmachinery and equipment.
During the three months ended March 31, 2019,2020, the Company sold equipment for net proceeds of $0.1 million and gains of $0.1 million. In addition, the Company recognized previously deferred gains of $0.3 million.
3.4. INVESTMENTS, AT EQUITY, AND ADVANCES TO 50% OR LESS OWNED COMPANIES
KSM. KSM operates four foreign-flag harbor tugs, one foreign-flag ocean liquid tank barge and one foreign-flag specialty vessel in Freeport, Grand Bahama. During the three months ended March 31, 2019, the Company earned $0.3 million for the bareboat charter of two foreign-flag harbor tugs to KSM.
Trailer Bridge. Trailer Bridge is an operator of U.S.-flag deck and RORO barges and provides marine transportation services between Jacksonville, Florida, San Juan, Puerto Rico and Puerto Plata, Dominican Republic. During the three months ended March 31, 2019,2020, the Company earned $0.9revenues of $1.0 million forfrom the time charter of one1 U.S.-flag offshore tug to Trailer Bridge.
KSM. KSM operates 4 foreign-flag harbor tugs, 1 foreign-flag ocean liquid tank barge and 2 foreign-flag specialty vessels in Freeport, Grand Bahama. During the three months ended March 31, 2020, the Company earned revenues of $0.4 million from the bareboat charter of 2 foreign-flag harbor tugs to KSM.
Bunge-SCF Grain. Bunge-SCF Grain operates terminal grain elevators in Illinois. During the three months ended March 31, 2020, the Company earned revenues of $0.2 million from the lease of a terminal facility to Bunge-SCF Grain.
SCF Bunge Marine. SCF Bunge Marine provides towing services on the U.S. Inland Waterways, primarily the Mississippi River, Illinois River, Tennessee River and Ohio River. During the three months ended March 31, 2019,2020, the Company earned $1.6revenues of $2.0 million forfrom the time charter of seven8 inland river towboats to SCF Bunge Marine.
Bunge-SCF Grain. Bunge-SCF GrainOther Inland Services. The Company’s other Inland Services 50% or less owned company operates terminal grain elevators in Illinois.a fabrication facility. During the three months ended March 31, 2019,2020, the Company earned $0.2and its partner each received a cash dividend of $0.1 million for the lease of a terminal facility to Bunge-SCF Grain.from this 50% or less owned company.
4.5. LONG-TERM DEBT
SEACOR’s Board of Directors previously approved a securities repurchase plan that authorizes the Company to acquire SEACOR common stock, par value $0.01 per share (“Common Stock”), 3.25% Convertible Senior Notes, 3.0% Convertible Senior Notes, 2.5% Convertible Senior Notes and 2.5%3.25% Convertible Senior Notes (collectively the “Securities”) through open market purchases, privately negotiated transactions or otherwise, depending on market conditions. As of March 31, 2019,2020, the Company’s remaining repurchase authority for the Securities was $43.5$113.1 million.
3.0% Convertible Senior Notes. During the three months ended March 31, 2019,2020, the Company purchased $24.0$15.6 million in principal amount of its 3.0% Convertible Senior Notes for $23.2total consideration of $15.4 million resulting in debt extinguishment losses of $0.8$0.3 million included in the accompanying condensed consolidated statements of income. The outstanding principal amount of these notes was $83.3$34.5 million as of March 31, 2019.2020.
SEACOR Revolving Credit Facility.On March 19, 2019, the Company entered into a $125.0 million credit agreement with a syndicate of lenders that matures March 19, 2024 (the “SEACOR Revolving Credit Facility”) that matures March 19, 2024 and is secured by a pledge over all of the Company’sSEACOR’s assets and certain of its subsidiariessubsidiaries’ assets, subject to certain exceptions. The SEACOR Revolving Credit Facility includes revolving loans up to $125.0 million, as such amount may increase or decrease in accordance with the terms of the Credit Agreement. The loans will bear interest at either (i) a Base Rate plus a margin ranging from 0.75% to 2.00% depending on the Company’s maximum net funded debt ratio, as determined in accordance with the SEACOR Revolving Credit Facility, or (ii) interest periods of one, two, three or six months at an annual rate equal to London Interbank Offered Rate (“LIBOR”) for the corresponding deposits of U.S. dollars, plus a margin ranging from 1.75% to 3.00% based on the Company’s maximum net funded debt ratio, as determined in accordance with the SEACOR Revolving Credit Facility. A fee of 0.5% is payable on the unused commitment quarterly. The Company incurred $2.2 million of issuance costs related to the SEACOR Revolving Credit Facility.
The SEACOR Revolving Credit Facility contains various financial and restrictive covenants including fixed charge coverage, a net funded debt ratio, a collateral coverage ratio and restrictions limiting the Company’s ability to pay dividends or make certain investments, as well as other customary covenants, representations and warranties, and events of default as defined in the agreement. As of March 31, 2019,2020, the Company had no outstanding borrowings or issued letters$125.0 million of credit under the SEACOR Revolving Credit Facility and the remaining availabilityborrowing capacity under this facility was $125.0 million.facility.
SEA-Vista 2019 Credit Facility.During the three months ended March 31, 2019,2020, SEA-Vista repaid $6.0made scheduled repayments of $2.5 million on the Revolving Loan and made scheduled payments of $0.8 million on theits Term A-1 Loan and $1.3 million on the Term A-2 Loan. As of March 31, 2019,2020, SEA-Vista had $100.0 million of remaining borrowing capacity under the Revolving Loan.this facility.
Other. During the three months ended March 31, 2019,2020, the Company made scheduled payments on other long-term debt of $0.2 million.
Letters of Credit. As of March 31, 2019,2020, the Company had outstanding letters of credit totaling $3.0$1.2 million with various expiration dates through 2027.
Guarantees. The Company has guaranteed the payments of amounts owed under certain sale-leaseback transactions, equipment financing and multi-employer pension obligations on behalf of SEACOR Marine. As of March 31, 2019,2020, these guarantees on behalf of SEACOR Marine totaled $36.6$18.5 million and decline as payments are made on the outstanding obligations. The Company earns a fee of 0.5% per annum on these guarantees. ForDuring the three months ended March 31, 2019,2020, the fees earned by the Company for these guarantees were not material.
5.6. OPERATING LEASES
Lessee.As of March 31, 2019,2020, the Company leases in twoleased-in 2 U.S.-flag petroleum and chemical carriers, five4 U.S.-flag harbor tugs, four4 U.S.-flag PCTCs, 50 inland river dry-cargo barges, four4 inland river towboats, six6 inland river harbor boats and certain facilities and other equipment. The leases generally contain purchase and renewal options or rights of first refusal with respect to the sale or lease of the equipment. As of March 31, 2019,2020, the remaining lease terms of the U.S.-flag petroleum and chemical carriers, which are subject to subleases, have remaining durations from 42 to 89of 30 and 77 months. The lease terms of the other vessels, facilities and equipment range in duration from 121 to 204192 months.
As of March 31, 2019, future minimum payments for operating leases for the remainder of 2019 and the years ended December 31 were as follows (in thousands):
|
| | | |
Remainder of 2019 | $ | 32,030 |
|
2020 | 40,792 |
|
2021 | 36,623 |
|
2022 | 26,780 |
|
2023 | 14,835 |
|
Years subsequent to 2023 | 40,382 |
|
| 191,442 |
|
Interest component | (24,040 | ) |
| 167,402 |
|
Current portion of long-term operating lease liabilities | (35,540 | ) |
Long-term operating lease liabilities | $ | 131,862 |
|
For the three months ended March 31, 2019, the components of lease expense were as follows (in thousands):
| | | 2019 | | 2020 | | 2019 |
Operating lease expense | $ | 10,554 |
| Operating lease expense | $ | 10,872 | | | $ | 10,554 | |
Short-term lease expense (lease duration of twelve months or less at lease commencement) | 6,720 |
| Short-term lease expense (lease duration of twelve months or less at lease commencement) | 5,596 | | | 6,720 | |
Sublease income | (8,225 | ) | Sublease income | (8,641) | | | (8,225) | |
| $ | 9,049 |
| | $ | 7,827 | | | $ | 9,049 | |
For the three months ended March 31, 2020, other information related to operating leases was as follows (in thousands except weighted average data):
|
| | | |
| 2019 |
Operating cash outflows from operating leases | $ | 10,482 |
|
Right-of-use assets obtained in exchange for operating lease liabilities | $ | 175,897 |
|
Weighted average remaining lease term, in years | 5.7 |
|
Weighted average discount rate | 4.8 | % |
Lessor. As of March 31, 2019, lessor arrangements with remaining terms in excess of one year included the bareboat charter of three U.S.-flag petroleum and chemical carriers and two U.S.-flag harbor tugs, the time charter of four U.S.-flag petroleum and chemical carriers, four U.S.-flag PCTCs, seven inland river towboats and one U.S.-flag offshore tug, and other non-vessel rental arrangements of certain property and equipment. As of March 31, 2019, future minimum lease revenues from these arrangements for the remainder of 2019 and in the years ended December 31 were as follows (in thousands):
|
| | | | | | | | | | | |
| Total Minimum Lease Revenues | | Leased-in Obligations(1) | | Net Minimum Lease Income |
Remainder of 2019 | $ | 110,773 |
| | $ | (23,944 | ) | | $ | 86,829 |
|
2020 | 137,257 |
| | (31,595 | ) | | 105,662 |
|
2021 | 104,792 |
| | (29,590 | ) | | 75,202 |
|
2022 | 54,374 |
| | (22,812 | ) | | 31,562 |
|
2023 | 34,674 |
| | (11,315 | ) | | 23,359 |
|
Years subsequent to 2023 | 87,375 |
| | (29,884 | ) | | 57,491 |
|
____________________
| | | | | | | |
(1)Operating cash outflows from operating leases | The total payments to be made under existing non-cancelable leases | | $ | 10,772 | |
Right-of-use assets obtained in exchange for the property and equipment subject to these future minimumoperating lease revenues.liabilities | | | $ | 872 | |
Weighted average remaining lease term, in years | | | 5.1 |
Weighted average discount rate | | | 4.9 | % |
| | | |
| | | |
As of March 31, 2019, the major classes of owned property and equipment earning lease revenues were as follows (in thousands):
|
| | | | | | | | | | |
| Historical Cost | | Accumulated Depreciation | | Net Book Value |
2019 | | | | | |
Ocean Services: | | | | | |
Petroleum and chemical carriers - U.S.-flag | $ | 472,462 |
| | $ | (187,296 | ) | | 285,166 |
|
Harbor and offshore tugs - U.S.-flag | 21,440 |
| | (2,173 | ) | | 19,267 |
|
| 493,902 |
| | (189,469 | ) | | 304,433 |
|
Inland Services: | | | | |
|
|
Towboats | 36,236 |
| | (2,435 | ) | | 33,801 |
|
| 530,138 |
| | (191,904 | ) | | 338,234 |
|
6.7. INCOME TAXES
The following table reconciles the difference between the statutory federal income tax rate forand the Company and theCompany's effective income tax rate on continuing operations for the three months ended March 31, 2019:
|
| | | | |
Statutory rate | 21.0 | % |
Income subject to tonnage tax | (2.712.1 | )% |
Non-deductible expenses | 1.0 | % |
Noncontrolling interestsU.S. federal income tax statutory changes | (6.3161.7 | )% |
Non-deductible expenses | (1.9) | % |
| |
Foreign earnings not subject to U.S. income tax | (5.8(13.7) | )% |
Foreign taxes not creditable against U.S. income tax | 3.85.8 | % |
| |
Subpart F income | 0.7(2.7) | % |
State taxes | 0.7(0.7) | % |
Share award plans | 12.4(2.1) | % |
| |
| 179.5 | % |
On March 27, 2020, the U.S. Congress passed and the President signed the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") into law to address the economic fallout of the 2020 coronavirus pandemic. One provision of the CARES Act increases the tax deduction for net operating losses from 80% to 100% for 2018 through 2020, allows net operating losses generated in 2018 through 2020 to be carried back up to five years and increases the deductible interest expense limit from 30% to 50% of taxable EBITDA. As a result of these statutory changes, during the three months ended March 31, 2020, the Company determined it will be able to carry its 2019 net operating losses back to tax years when the statutory tax rate was 35% resulting in an income tax benefit of $12.7 million, which is included in income tax expense (benefit) in the accompanying condensed consolidated statements of income. As of March 31, 2020, $37.4 million of income tax receivables is included in other receivables in the accompanying condensed consolidated balance sheets.
8. DERIVATIVE INSTRUMENTS AND HEDGING STRATEGIES
One of the Company’s 50% or less owned companies has subsidiaries with interest rate swap agreements designated as cash flow hedges, with an aggregate amortizing notional value of $48.0 million that mature in March 2028. These interest rate swaps call for the subsidiaries to pay a fixed rate of 1.74% on the aggregate amortizing notional value and receive a variable interest rate based on LIBOR. By entering into these interest rate swap agreements, the Company's 50% or less owned companies converted the variable LIBOR component of certain of its outstanding borrowings to a fixed interest rate. During the three months ended March 31, 2020, the Company recognized losses on the fair value of these contracts of $0.9 million which is included as a component of other comprehensive income (loss).
9. FAIR VALUE MEASUREMENTS
The fair value of an asset or liability is the price that would be received to sell an asset or transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company utilizes a fair value hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value and defines three levels of inputs that may be used to measure fair value. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs derived from observable market data. Level 3 inputs are unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.
As of March 31, 2019,2020, the Company’s financial assets and liabilities that are measured at fair value on a recurring basis were as follows (in thousands):
|
| | | | | | | | | | | |
| Level 1 | | Level 2 | | Level 3 |
ASSETS | | | | | |
Cash, cash equivalents, restricted cash and restricted cash equivalents | $ | 144,144 |
| | $ | — |
| | $ | — |
|
Marketable securities(1) | 33,384 |
| | — |
| | — |
|
Construction reserve funds | 3,908 |
| | — |
| | — |
|
______________________
| | | | | | | | | | | | | | | | | |
(1) | Level 1 | | Level 2 | | Level 3 |
ASSETS | | | | | |
Cash, cash equivalents, restricted cash and restricted cash equivalents | $ | 77,330 | | | $ | — | | | $ | — | |
Marketable security gains (losses), net include unrealized gains of $3.1 million and unrealized losses of $3.8 million for the three months ended March 31, 2019 and 2018, respectively, related to marketable security positions held by the Company as of March 31, 2019.securities(1) | 7,832 | | | — | | | — | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
______________________
(1)Marketable security gains (losses), net include unrealized losses of $0.1 million for the three months ended March 31, 2020 related to marketable security positions held by the Company as of March 31, 2020.
As of March 31, 2019,2020, the estimated fair values of the Company’s other financial assets and liabilities were as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| | | Estimated Fair Value | | | | |
| Carrying Amount | | Level 1 | | Level 2 | | Level 3 |
ASSETS | | | | | | | |
Notes receivable from third parties (included in other receivables and other assets) | $ | 1,127 | | | $ | — | | | $ | 1,127 | | | $ | — | |
Investments, at cost, in 50% or less owned companies (included in other assets) | 4,201 | | | see below | | | | |
LIABILITIES | | | | | | | |
Long-term debt, including current portion(1) | $ | 298,767 | | | $ | — | | | $ | 279,349 | | | $ | — | |
|
| | | | | | | | | | | | | | | |
| | | Estimated Fair Value |
| Carrying Amount | | Level 1 | | Level 2 | | Level 3 |
ASSETS | | | | | | | |
Notes receivable from third parties (included in other receivables and other assets) | $ | 2,027 |
| | $ | — |
| | $ | 2,020 |
| | $ | — |
|
Investments, at cost, in 50% or less owned companies (included in other assets) | 4,300 |
| | see below | | | | |
LIABILITIES | | | | | | | |
Long-term debt, including current portion(1) | $ | 323,611 |
| | $ | — |
| | $ | 335,144 |
| | $ | — |
|
____________________________________________(1)The estimated fair value includes the embedded conversion options on the Company’s 3.0% Convertible Senior Notes, 2.5% Convertible Senior Notes and 3.25% Convertible Senior Notes.
| |
(1) | The estimated fair value includes the embedded conversion options on the Company’s 3.0% Convertible Senior Notes and 3.25% Convertible Senior Notes. |
The fair value of the Company’s long-term debt and notes receivable from third parties was estimated based upon quoted market prices or by using discounted cash flow analyses based on estimated current rates for similar types of arrangements. It was not practicable to estimate the fair value of certain of the Company’s investments, at cost, in 50% or less owned companies because of the lack of quoted market prices and the inability to estimate fair value without incurring excessive costs. Considerable judgment was required in developing certain of the estimates of fair value
including the consideration of the recent COVID-19 pandemic that has caused significant volatility in U.S. and international markets, and accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
8.
10. EQUITY TRANSACTIONS
SEACOR’s Board of Directors previously approved a securities repurchase plan that authorizes the Company to acquire its Securities through open market purchases, privately negotiated transactions or otherwise, depending on market conditions (see Note 5).
During the three months ended March 31, 2020, the Company acquired 41,600 shares of Common Stock for treasury for an aggregate purchase price of $1.4 million. As of March 31, 2020, the Company’s repurchase authority for the Securities was $113.1 million.
During the three months ended March 31, 2020, the Company acquired 17,144 shares of Common Stock for treasury for an aggregate purchase price of $0.5 million from its employees to cover their tax withholding obligations related to the vesting of equity awards. These shares were purchased in accordance with the terms of the Company’s Share Incentive Plans and not pursuant to the repurchase authorizations for its Securities granted by SEACOR’s Board of Directors.
11. NONCONTROLLING INTERESTS IN SUBSIDIARIES
Noncontrolling interests in the Company’s consolidated subsidiaries were as follows (in thousands):
|
| | | | | | | | | | | | |
| Noncontrolling Interests | | March 31, 2019 | | December 31, 2018 |
Ocean Services: | | | | | | | |
SEA-Vista | 49% | | $ | 163,828 |
| | $ | 148,665 |
|
Inland Services: | | | | | | | |
Other | 3.0 | % | – | 51.8% | | 870 |
| | 862 |
|
Other | 5.0% | | 5 |
| | 161 |
|
| | | | | $ | 164,703 |
| | $ | 149,688 |
|
SEA-Vista.SEA-Vista owns and operates the Company’s fleet of U.S.-flag petroleum and chemical carriers used in the U.S. coastwise trade of crude oil, petroleum and specialty chemical products. As of March 31,On August 2, 2019, the net assets ofCompany acquired the Remaining SEA-Vista were $334.3 million.Interest. During the three months ended March 31, 2019, the net income of SEA-Vista was $10.9 million, of which $5.3 million was attributable to noncontrolling interests.
12. MULTI-EMPLOYER AND DEFINED BENEFIT PENSION PLANS
During the three months ended March 31, 2018, the net income of SEA-Vista was $10.0 million, of which $4.9 million was attributable to noncontrolling interests.
9. MULTI-EMPLOYER AND DEFINED BENEFIT PENSION PLANS
AMOPP. During the three months ended March 31, 2019,2020, the Company received notification from the AMOPP that the Company’s withdrawal liability as of September 30, 20182019, the latest period for which an actuarial valuation is available, would have been $28.1 million based on an actuarial valuation performed as of that date.$25.5 million. That liability may change in future years based on various factors, primarily employee census. As of March 31, 2019,2020, the Company has no intention to withdraw from the AMOPP and no deficit amounts have been invoiced. Depending upon the results of the future actuarial valuations, and the ten-year rehabilitation plan, it is possible that the AMOPP will experience further funding deficits, requiring the Company to recognize additional payroll related operating expenses in the periods invoices are received or contribution levels are increased.
10.13. SHARE BASED COMPENSATION
During the three months ended March 31, 2019,2020, transactions in connection with the Company’s share based compensation plans were as follows:
|
| | | | |
Director stock awards granted | 625500 |
|
Employee Stock Purchase Plan (“ESPP”) shares issued | 22,57729,917 |
|
Restricted stock awards granted | 149,950167,650 |
|
| |
Stock Option Activities: | |
Outstanding as of December 31, 20182019 | 1,467,3911,454,074 |
|
Granted | 38,48540,258 |
|
Exercised | (32,732(17,533) | ) |
| |
Expired | (3,025) | |
Outstanding as of March 31, 20192020 | 1,473,1441,473,774 |
|
Shares available for future grants and ESPP purchases as of March 31, 20192020 | 672,581304,114 |
|
14. COMMITMENTS AND CONTINGENCIES
As of March 31, 2019,2020, the Company's capital commitments by year of expected payment were as follows (in thousands):
| | | Remainder of 2019 | | 2020 | | Total | | Remainder of 2020 | | 2021 | | 2022 | | | Total |
Ocean Services | $ | 1,378 |
| | $ | 8,388 |
| | $ | 9,766 |
| Ocean Services | $ | 20,864 | | | $ | 30,993 | | | $ | 2,636 | | | | $ | 54,493 | |
Inland Services | 17,875 |
| | 1,039 |
| | 18,914 |
| Inland Services | 6,318 | | | — | | | — | | | | 6,318 | |
Other | 176 |
| | — |
| | 176 |
| Other | 226 | | | — | | | — | | | | 226 | |
| $ | 19,429 |
| | $ | 9,427 |
| | $ | 28,856 |
| | $ | 27,408 | | | $ | 30,993 | | | $ | 2,636 | | | | $ | 61,037 | |
Ocean Services' capital commitments included 4 U.S.-flag harbor tugs and an interest in two2 foreign-flag rail ferries. Inland Services’ capital commitments included two6 inland river dry-cargo barges, 2 inland river towboats, other equipment, and vessel and terminal improvements. Subsequent to March 31, 2019,2020, the Company committed to purchase additionalother property and equipment for $1.5$1.1 million.
During 2012, the Company sold National Response Corporation (“NRC”), NRC Environmental Services Inc., SEACOR Response Ltd., and certain other subsidiaries to J.F. Lehman & Company, a private equity firm (the “SES Business Transaction”).
On December 15, 2010, O’Brien’s Response Management L.L.C. (“ORM”) and NRC were named as defendants in one of the several “master complaints” filed in the overall multi-district litigation relating to the Deepwater Horizon oil spill response and clean-up in the Gulf of Mexico (the the “DWH Response)Response”), which is currently pending in the U.S. District Court for the Eastern District of Louisiana (the “MDL”). The “B3” master complaint naming ORM and NRC asserted various claims on behalf of a putative class against multiple defendants concerning the clean-up activities generally and the use of dispersants specifically. Both prior to and following the filing of the aforementioned “B3” master complaint, individual civil actions naming the Company, ORM, and/or NRC alleging B3“B3” exposure-based injuries and/or damages were consolidated with the MDL and stayed pursuant to court order. On February 16, 2016, all but eleven11 “B3” claims against ORM and NRC were dismissed with prejudice (the “B3 Dismissal Order”). On August 2, 2016, the Court granted an omnibus motion for summary judgment as it concerns ORM and NRC in its entirety, dismissing the remaining eleven11 plaintiffs’ claims against ORM and NRC with prejudice (the “Remaining Eleven Plaintiffs’ Dismissal Order”). The deadline to appeal both of these orders has expired. At present, there is only oneThe last remaining claim. On April 8, 2013, the Company, ORM, and NRC were named as defendants in William and Dianna Fitzgerald v. BP Exploration et al., No. 2:13-CV-00650 (E.D. La.) (the “Fitzgerald Action”), which is a suit by a husband and wife whose son allegedly participated in the clean-up effort and became ill as a result of his exposure to oil and dispersants. While the decedent in the Fitzgerald Action’s claims against ORM and NRC were dismissed by virtue of the Remaining Eleven Plaintiffs’ Dismissal Order, the claim as against the Company remains stayed. The Company is unable to estimatein connection with the potential exposure, if any, resulting from this matter, to“B3” master complaint was dismissed with prejudice, by an order of the extent it remains viable, but believes it is without merit and does not expect that it will have a material effectCourt granted on its consolidated financial position, results of operations or cash flows.July 25, 2019.
On February 18, 2011, Triton Asset Leasing GmbH, Transocean Holdings LLC, Transocean Offshore Deepwater Drilling Inc., and Transocean Deepwater Inc. (collectively “Transocean”) named ORM and NRC as third-party defendants in a Rule 14(c) Third-Party Complaint in Transocean’s own Limitation of Liability Act action, which is part of the overall MDL, tendering to ORM and NRC the claims in the “B3” master complaint that have already been asserted against ORM and NRC. Various contribution and indemnity cross-claims and counterclaims involving ORM and NRC were subsequently filed. The Company believes that the potential exposure, if any, resulting therefrom has been reduced as a result of the various developments in the MDL, including the B3 Dismissal Order and Remaining Eleven Plaintiffs’ Dismissal Order, and does not expect that these matters will have a material effect on its consolidated financial position, results of operations or cash flows.
Separately, on March 2, 2012, the Court announced that BP Exploration and Production Inc. (“BPXP”) and BP America Production Company (“BP America,” and with BPXP, “BP”) and the Plaintiffs had reached an agreement on the terms of two proposed class action settlements that willwould resolve, among other things, Plaintiffs’ economic loss and property damage claims and clean-up related claims against BP. The Company, ORM, and NRC had no involvement in negotiating or agreeing to the terms of either settlement, nor are they parties or signatories thereto. The BP settlement pertaining to personal injury claims (the “Medical Settlement”) purported to resolve the “B3” claims asserted against BP and also established a right for class members to pursue individual claims against BP (but not ORM or NRC) for “later-manifested physical conditions,” defined in the Medical Settlement to be physical conditions that were “first diagnosed” after April 16, 2012 and which are claimed to have resulted from exposure during the DWH Response. TheThis back-end litigation-option (“BELO”) provision of the Medical Settlement has specifically-delineated procedures and limitations, should any “B3” class member seek to invoke their BELO right. For example, there are limitations on the claims and defenses that can be asserted, as well as on the issues, elements, and proofs that may be litigated at any trial and the potential recovery for any Plaintiff. Notwithstanding that the Company, ORM, and NRC are listed on the Medical Settlement’s release as to claims asserted by Plaintiffs, the Medical Settlement still permits BP to seek indemnity from any party, to the extent BP has a valid indemnity right. The Medical Settlement was approved by the Court on January 11, 2013 and made effective on February 12, 2014.
As of mid-April 2019,2020, BP has tendered approximately 2,2502,385 claims pursued pursuant to the Medical Settlement’s BELO provision for indemnity to ORM and approximately 210230 of such claims to NRC. Recently, approximately 750 of the claims that were tendered by BP to ORM and approximately 65 of the claims tendered to NRC have been dismissed with prejudice. ORM and NRC have rejected all of BP’s indemnity demands relating to the Medical Settlement’s BELO provision and on February 14, 2019 commenced a legal action against BPXP and BP America with respect to same. That action, captionedO’Brien’s Response Management, L.L.C. et al. v. BP Exploration & Production Inc. et al., Case No. 2:19-CV-01418-CJB-JCW (E.D. La.) (the “Declaratory Judgment Action”), seeks declaratory relief that neither ORM andnor NRC owehave any indemnity obligation to BP no indemnity with respect to the exposure-based claims expressly contemplated by the Medical Settlement’s BELO provision, nor any contribution, in light of BP’s own actions and conduct over the past nineten years (including its complete failure to even seek indemnity) and the resultant prejudice to ORM and NRC; that any indemnity or contribution rights BP may have once had with respect to these personal injury and exposure claims were extinguished once the Medical Settlement was approved by the MDL Court in 2013; and that the immunity already afforded to ORMORM’s and NRC via the B3 Dismissal OrderNRC’s contractual and the Remaining Eleven Plaintiffs’ Dismissal Order operatescommon law rights operate to bar any indemnity or contribution claims against them by BP. BP’s responsive pleadingBP subsequently proceeded to the Complaint in the Declaratory Judgment Action is due on May 7, 2019.
The Court has also ordered the parties to participate in early mediation per BP’s request. Mediation is schedule for June 21, 2019 and the parties are in the process of exchanging information in advance of those proceedings.
BP has also similarly recently tenderedbegin tendering personal injury claims to ORM and NRC that are being pursued by Plaintiffsplaintiffs who opted out of the Medical Settlement and who are thus proceeding with their “B3” claims in their ordinary course (as opposed to pursuant to the Medical Settlement’s BELO provision). ORM and NRC also rejected these demands, and amended its Declaratory Judgment Action on December 11, 2019 to cover BP’s indemnity demands for these opt out claims as well.
On October 16, 2019, BP asserted 4 amended counterclaims against ORM and NRC, as well as 2 claims against ORM’s insurer (Navigators). Those amended counterclaims are breach of contract against ORM for allegedly failing to indemnify BP or name BP as an additional insured on the Navigators policy, declaratory judgment that NRC must allegedly indemnify BP under certain circumstances, and unjust enrichment against ORM and NRC. ORM and NRC successfully moved to dismiss the unjust enrichment counterclaim. The parties also filed simultaneous motions for judgment on the pleadings on February 14, 2020, and oppositions to the motions on March 16, 2020. The Court has not yet ordered whether a hearing on those motions will occur or whether the motions can be decided without a hearing.
Generally, speaking, the Company, ORM, and NRC believe that BP’s indemnity demands with respect to any “B3” claims, including those involving Medical Settlement class members invoking BELO rights and those involving Medical Settlement opt-out Plaintiffs, are untimely and improper, and intend to vigorously defend their interests. Moreover, ORM has contractual indemnity coverage for the above-referenced claims through its separate agreements with sub-contractors that worked for ORM during the DWH Response and have preserved theirhas attempted to preserve its rights in that regard while the Declaratory Judgment Action is pending. Overall, however, the Company believes that both of BP’s settlements have reduced the potential exposure in connection with the various cases relating to the DWH Response. The Company is unable to estimate the potential exposure, if any, resulting from these claims, but does not expect that they will have a material effect on its consolidated financial position, results of operations or cash flows.
In the ordinary course of the Company’s business, it may agree to indemnify its counterparty to an agreement. If the indemnified party makes a successful claim for indemnification, the Company would be required to reimburse that party in accordance with the terms of the indemnification agreement. Indemnification agreements generally, but not always, are subject to threshold amounts, specified claim periods and other restrictions and limitations.
In connection with the SES Business Transaction, the Company remains contingently liable for work performed in connection with the DWH Response. Pursuant to the agreement governing the sale, the Company’s potential liability to the purchaser may not exceed the consideration received by the Company for the SES Business Transaction. The Company is currently indemnified under contractual agreements with BP for the potential “B3” liabilities relating to the DWH Response; this indemnification is unrelated to, and thus not impacted by, the indemnification BP has demanded and discussed above.
In the ordinary course of its business, the Company becomes involved in various other litigation matters including, among other things, claims by third parties for alleged property damages and personal injuries. Management has used estimates in determining the Company’s potential exposure to these matters and has recorded reserves in its financial statements related thereto where appropriate. It is possible that a change in the Company’s estimates of that exposure could occur, but the Company does not expect such changes in estimated costs would have a material effect on the Company’s consolidated financial position, results of operations or cash flows.
12.15. SEGMENT INFORMATION
Accounting standards require public business enterprises to report information about each of their operating business segments that exceed certain quantitative thresholds or meet certain other reporting requirements. Operating business segments have been defined as components of an enterprise about which separate financial information is available and is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company’s basis of measurement of segment profit or loss is as previously defined in the Company’s Annual report on Form
10-K for the year ended December 31, 2018.2019. Accounting standards also require companies to disaggregate revenues from contracts with customers into categories to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The following tables summarize the operating results, capital expenditures, assets and disaggregated revenues of the Company’s reportable segments.
|
| | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2019 | | | | | | | | | | | |
Operating Revenues: | | | | | | | | | | | |
External customers | 109,272 |
| | 65,602 |
| | 32,845 |
| | 1,805 |
| | — |
| | 209,524 |
|
Intersegment | — |
| | — |
| | 98 |
| | — |
| | (98 | ) | | — |
|
| 109,272 |
| | 65,602 |
| | 32,943 |
| | 1,805 |
| | (98 | ) | | 209,524 |
|
Costs and Expenses: | | | | | | | | | | | |
Operating | 69,932 |
| | 54,245 |
| | 21,772 |
| | 1,253 |
| | (91 | ) | | 147,111 |
|
Administrative and general | 10,198 |
| | 3,356 |
| | 6,402 |
| | 839 |
| | 5,951 |
| | 26,746 |
|
Depreciation and amortization | 10,337 |
| | 5,725 |
| | 206 |
| | 489 |
| | 379 |
| | 17,136 |
|
| 90,467 |
| | 63,326 |
| | 28,380 |
| | 2,581 |
| | 6,239 |
| | 190,993 |
|
Gains on Asset Dispositions | 17 |
| | 420 |
| | — |
| | — |
| | — |
| | 437 |
|
Operating Income (Loss) | 18,822 |
| | 2,696 |
| | 4,563 |
| | (776 | ) | | (6,337 | ) | | 18,968 |
|
Other Income (Expense): | | | | | | | | | | | |
Foreign currency gains (losses), net | (47 | ) | | 459 |
| | — |
| | — |
| | (7 | ) | | 405 |
|
Other, net | (651 | ) | | — |
| | (3 | ) | | — |
| | 10 |
| | (644 | ) |
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax | 111 |
| | (2,472 | ) | | (67 | ) | | (90 | ) | | — |
| | (2,518 | ) |
Segment Profit (Loss) | 18,235 |
| | 683 |
| | 4,493 |
| | (866 | ) | | | | |
Other Income (Expense) not included in Segment Profit (Loss) | | | | | | | | | | (938 | ) |
Less Equity Losses included in Segment Profit (Loss) | | | | | | | | | | | 2,518 |
|
Income Before Taxes and Equity Losses | | | | | | | | | | 17,791 |
|
| | | | | | | | | | | |
Capital Expenditures | 247 |
| | 5,237 |
| | 20 |
| | 145 |
| | — |
| | 5,649 |
|
| | | | | | | | | | | |
As of March 31, 2019 | | | | | | | | | | | |
Property and Equipment: | | | | | | | | | | |
|
|
Historical cost | 930,464 |
| | 444,609 |
| | 1,246 |
| | 7,037 |
| | 30,132 |
| | 1,413,488 |
|
Accumulated depreciation | (352,005 | ) | | (200,516 | ) | | (1,053 | ) | | (979 | ) | | (22,583 | ) | | (577,136 | ) |
Net property and equipment | 578,459 |
| | 244,093 |
| | 193 |
| | 6,058 |
| | 7,549 |
| | 836,352 |
|
Operating Lease Right-of-Use Assets | 125,640 |
| | 36,534 |
| | 987 |
| | — |
| | 4,164 |
| | 167,325 |
|
Investments, at Equity, and Advances to 50% or Less Owned Companies | 74,127 |
| | 56,238 |
| | 419 |
| | 24,506 |
| | — |
| | 155,290 |
|
Inventories | 2,042 |
| | 2,183 |
| | 366 |
| | 323 |
| | — |
| | 4,914 |
|
Goodwill | 1,852 |
| | 2,362 |
| | 28,506 |
| | — |
| | — |
| | 32,720 |
|
Intangible Assets | 8,633 |
| | 8,618 |
| | 6,411 |
| | — |
| | — |
| | 23,662 |
|
Other current and long-term assets, excluding cash and near cash assets(1) | 53,070 |
| | 62,832 |
| | 91,591 |
| | 2,383 |
| | 10,231 |
| | 220,107 |
|
Segment Assets | 843,823 |
| | 412,860 |
| | 128,473 |
| | 33,270 |
| | | | |
Cash and near cash assets(1) | | | | | | | | | | | 181,436 |
|
Total Assets | | | | | | | | | | | 1,621,806 |
|
______________________
| | | | | | | | | | |
(1) | Cash and near cash assets includes cash, cash equivalents, restricted cash, restricted cash equivalents, marketable securities and construction reserve funds. |
|
| | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2019 | | | | | | | | | | | |
Revenues from Contracts with Customers: | | | | | | | | | | |
|
|
Voyage charters | 9,314 |
| | — |
| | — |
| | — |
| | — |
| | 9,314 |
|
Contracts of affreightment | 3,730 |
| | 48,984 |
| | — |
| | — |
| | — |
| | 52,714 |
|
Tariff | 20,996 |
| | — |
| | — |
| | — |
| | — |
| | 20,996 |
|
Unit freight | 16,012 |
| | — |
| | — |
| | — |
| | — |
| | 16,012 |
|
Terminal operations | — |
| | 5,480 |
| | — |
| | — |
| | — |
| | 5,480 |
|
Fleeting operations | — |
| | 4,070 |
| | — |
| | — |
| | — |
| | 4,070 |
|
Logistics Services | — |
| | 3,538 |
| | — |
| | — |
| | — |
| | 3,538 |
|
Time and material contracts | — |
| | — |
| | 29,946 |
| | — |
| | — |
| | 29,946 |
|
Retainer contracts | — |
| | — |
| | 2,405 |
| | — |
| | — |
| | 2,405 |
|
Product sales(1) | — |
| | — |
| | — |
| | 1,310 |
| | — |
| | 1,310 |
|
Other | 934 |
| | 902 |
| | 592 |
| | 255 |
| | (98 | ) | | 2,585 |
|
Lease Revenues: | | | | | | | | | | |
|
|
Time charter, bareboat charter and rental income | 58,286 |
| | 2,628 |
| | — |
| | 240 |
| | — |
| | 61,154 |
|
| 109,272 |
|
| 65,602 |
| | 32,943 |
| | 1,805 |
| | (98 | ) | | 209,524 |
|
______________________ | | | | | | | | | |
(1) | Costs of goods sold related to product sales was $1.1 million. |
|
| | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2018 | | | | | | | | | | | |
Operating Revenues: | | | | | | | | | | | |
External customers | 102,384 |
| | 55,921 |
| | 26,403 |
| | 116 |
| | — |
| | 184,824 |
|
Intersegment | — |
| | — |
| | 29 |
| | — |
| | (29 | ) | | — |
|
| 102,384 |
| | 55,921 |
| | 26,432 |
| | 116 |
| | (29 | ) | | 184,824 |
|
Costs and Expenses: | | | | | | | | | | | |
Operating | 65,333 |
| | 48,181 |
| | 18,306 |
| | — |
| | (43 | ) | | 131,777 |
|
Administrative and general | 10,549 |
| | 3,312 |
| | 5,367 |
| | 186 |
| | 6,381 |
| | 25,795 |
|
Depreciation and amortization | 12,645 |
| | 6,234 |
| | 301 |
| | — |
| | 429 |
| | 19,609 |
|
| 88,527 |
| | 57,727 |
| | 23,974 |
| | 186 |
| | 6,767 |
| | 177,181 |
|
Gains on Asset Dispositions | 1,883 |
| | 5,162 |
| | — |
| | — |
| | — |
| | 7,045 |
|
Operating Income (Loss) | 15,740 |
| | 3,356 |
| | 2,458 |
| | (70 | ) | | (6,796 | ) | | 14,688 |
|
Other Income (Expense): | | | | | | | | | | | |
Foreign currency gains (losses), net | (51 | ) | | 1,703 |
| | 2 |
| | — |
| | 36 |
| | 1,690 |
|
Other, net | 283 |
| | — |
| | — |
| | — |
| | — |
| | 283 |
|
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax | 315 |
| | (2,454 | ) | | 135 |
| | 1,167 |
| | — |
| | (837 | ) |
Segment Profit | 16,287 |
| | 2,605 |
| | 2,595 |
| | 1,097 |
| | | | |
Other Income (Expense) not included in Segment Profit | | | | | | | | | | (10,547 | ) |
Less Equity Losses included in Segment Profit | | | | | | | | | | | 837 |
|
Income Before Taxes and Equity Losses | | | | | | | | | | 6,114 |
|
| | | | | | | | | | | |
Capital Expenditures | 7,516 |
| | 1,899 |
| | — |
| | — |
| | 127 |
| | 9,542 |
|
| | | | | | | | | | | |
As of March 31, 2018 | | | | | | | | | | | |
Property and Equipment: | | | | | | | | | | |
|
|
Historical cost | 901,747 |
| | 437,411 |
| | 1,227 |
| | — |
| | 30,132 |
| | 1,370,517 |
|
Accumulated depreciation | (309,371 | ) | | (179,152 | ) | | (961 | ) | | — |
| | (20,934 | ) | | (510,418 | ) |
Net property and equipment | 592,376 |
| | 258,259 |
|
| 266 |
|
| — |
|
| 9,198 |
| | 860,099 |
|
Investments, at Equity, and Advances to 50% or Less Owned Companies | 53,620 |
| | 64,744 |
| | 734 |
| | 51,207 |
| | — |
| | 170,305 |
|
Inventories | 1,732 |
| | 2,039 |
| | 50 |
| | — |
| | — |
| | 3,821 |
|
Goodwill | 1,852 |
| | 2,449 |
| | 28,506 |
| | — |
| | — |
| | 32,807 |
|
Intangible Assets | 9,961 |
| | 10,112 |
| | 7,999 |
| | — |
| | — |
| | 28,072 |
|
Other current and long-term assets, excluding cash and near cash assets(1) | 57,593 |
| | 54,531 |
| | 43,563 |
| | 1,770 |
| | 8,655 |
| | 166,112 |
|
Segment Assets | 717,134 |
| | 392,134 |
| | 81,118 |
| | 52,977 |
| | | | |
Cash and near cash assets(1) | | | | | | | | | | | 351,257 |
|
Total Assets | | | | | | | | | | | 1,612,473 |
|
______________________
| | | | | | |
(1) | Cash and near cash assets includes cash, cash equivalents, restricted cash, restricted cash equivalents, marketable securities and construction reserve funds. | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2020 | | | | | | | | | | | |
Operating Revenues: | | | | | | | | | | | |
External customers | 106,115 | | | 61,311 | | | 22,471 | | | 2,399 | | | — | | | 192,296 | |
Intersegment | — | | | — | | | 35 | | | — | | | (35) | | | — | |
| 106,115 | | | 61,311 | | | 22,506 | | | 2,399 | | | (35) | | | 192,296 | |
Costs and Expenses: | | | | | | | | | | | |
Operating | 77,604 | | | 50,919 | | | 15,691 | | | 1,847 | | | (33) | | | 146,028 | |
Administrative and general | 10,744 | | | 3,488 | | | 7,679 | | | 1,124 | | | 5,986 | | | 29,021 | |
Depreciation and amortization | 10,282 | | | 6,212 | | | 259 | | | 619 | | | 357 | | | 17,729 | |
| 98,630 | | | 60,619 | | | 23,629 | | | 3,590 | | | 6,310 | | | 192,778 | |
Gains on Asset Dispositions, Net | 9 | | | 315 | | | — | | | 60 | | | — | | | 384 | |
Operating Income (Loss) | 7,494 | | | 1,007 | | | (1,123) | | | (1,131) | | | (6,345) | | | (98) | |
Other Income (Expense): | | | | | | | | | | | |
| | | | | | | | | | | |
Foreign currency gains (losses), net | (78) | | | (4,478) | | | 12 | | | — | | | (38) | | | (4,582) | |
Other, net | 22 | | | — | | | 70 | | | — | | | — | | | 92 | |
Equity in Losses of 50% or Less Owned Companies, Net of Tax | (1,357) | | | (3,376) | | | (8) | | | (52) | | | — | | | (4,793) | |
Segment Profit (Loss) | 6,081 | | | (6,847) | | | (1,049) | | | (1,183) | | | | | |
Other Income (Expense) not included in Segment Loss | | | | | | | | | | | (3,292) | |
Less Equity Losses included in Segment Loss | | | | | | | | | | | 4,793 | |
Loss Before Taxes and Equity Losses | | | | | | | | | | | (7,880) | |
| | | | | | | | | | | |
Capital Expenditures | 3,177 | | | 2,196 | | | — | | | 839 | | | 165 | | | 6,377 | |
| | | | | | | | | | | |
As of March 31, 2020 | | | | | | | | | | | |
Property and Equipment: | | | | | | | | | | | |
Historical cost | 935,400 | | | 463,291 | | | 1,142 | | | 10,547 | | | 31,129 | | | 1,441,509 | |
Accumulated depreciation | (390,481) | | | (220,798) | | | (1,024) | | | (3,032) | | | (24,089) | | | (639,424) | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
Net property and equipment | 544,919 | | | 242,493 | | | 118 | | | 7,515 | | | 7,040 | | | 802,085 | |
Operating Lease Right-of-Use Assets | 103,725 | | | 29,564 | | | 2,626 | | | — | | | 265 | | | 136,180 | |
Investments, at Equity, and Advances to 50% or Less Owned Companies | 75,357 | | | 52,443 | | | 987 | | | 22,781 | | | — | | | 151,568 | |
Inventories | 1,605 | | | 1,988 | | | 211 | | | 246 | | | — | | | 4,050 | |
Goodwill | 1,852 | | | 2,228 | | | 28,506 | | | — | | | — | | | 32,586 | |
Intangible Assets | 7,305 | | | 7,123 | | | 8,524 | | | — | | | — | | | 22,952 | |
Other current and long-term assets, excluding cash and near cash assets(1) | 62,775 | | | 55,794 | | | 110,415 | | | 5,043 | | | 40,263 | | | 274,290 | |
Segment Assets | 797,538 | | | 391,633 | | | 151,387 | | | 35,585 | | | | | |
Cash and near cash assets(1) | | | | | | | | | | | 85,162 | |
| | | | | | | | | | | |
Total Assets | | | | | | | | | | | 1,508,873 | |
______________________
(1)Cash and near cash assets includes cash, cash equivalents, restricted cash, restricted cash equivalents and marketable securities.
| | | | | | | | | | | | | | | Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 | |
For the three months ended March 31, 2018 | | | | | | | | | | | | |
For the three months ended March 31, 2020 | | For the three months ended March 31, 2020 | | | | | | | | | | | |
Revenues from Contracts with Customers: | | | | | | | | | | | | Revenues from Contracts with Customers: | |
Voyage charters | 16,501 |
| | — |
| | — |
| | — |
| | — |
| | 16,501 |
| Voyage charters | 16,037 | | | — | | | — | | | — | | | — | | | 16,037 | |
Contracts of affreightment | 5,006 |
| | 40,290 |
| | — |
| | — |
| | — |
| | 45,296 |
| Contracts of affreightment | 4,496 | | | 43,703 | | | — | | | — | | | — | | | 48,199 | |
Tariff | 18,001 |
| | — |
| | — |
| | — |
| | — |
| | 18,001 |
| Tariff | 22,571 | | | — | | | — | | | — | | | — | | | 22,571 | |
Unit freight | 13,384 |
| | — |
| | — |
| | — |
| | — |
| | 13,384 |
| Unit freight | 16,448 | | | — | | | — | | | — | | | — | | | 16,448 | |
Terminal operations | — |
| | 5,746 |
| | — |
| | — |
| | — |
| | 5,746 |
| Terminal operations | — | | | 5,724 | | | — | | | — | | | — | | | 5,724 | |
Fleeting operations | — |
| | 4,211 |
| | — |
| | — |
| | — |
| | 4,211 |
| Fleeting operations | — | | | 4,354 | | | — | | | — | | | — | | | 4,354 | |
Logistics Services | — |
| | 2,815 |
| | — |
| | — |
| | — |
| | 2,815 |
| Logistics Services | — | | | 3,287 | | | — | | | — | | | — | | | 3,287 | |
Time and material contracts | — |
| | — |
| | 23,625 |
| | — |
| | — |
| | 23,625 |
| Time and material contracts | — | | | — | | | 19,206 | | | — | | | — | | | 19,206 | |
Retainer contracts | — |
| | — |
| | 2,383 |
| | — |
| | — |
| | 2,383 |
| Retainer contracts | — | | | — | | | 2,554 | | | — | | | — | | | 2,554 | |
Product sales(1) | | Product sales(1) | — | | | — | | | — | | | 1,657 | | | — | | | 1,657 | |
Other | 852 |
| | 960 |
| | 424 |
| | 116 |
| | (29 | ) | | 2,323 |
| Other | 950 | | | 1,257 | | | 746 | | | 640 | | | (35) | | | 3,558 | |
Lease Revenues: | | | | | | | | | | |
|
| Lease Revenues: | |
Time charter, bareboat charter and rental income | 48,640 |
| | 1,899 |
| | — |
| | — |
| | — |
| | 50,539 |
| Time charter, bareboat charter and rental income | 45,613 | | | 2,986 | | | — | | | 102 | | | — | | | 48,701 | |
| 102,384 |
| | 55,921 |
| | 26,432 |
| | 116 |
| | (29 | ) | | 184,824 |
| | 106,115 | | | 61,311 | | | 22,506 | | | 2,399 | | | (35) | | | 192,296 | |
______________________
(1)Cost of goods sold related to product sales was $1.4 million.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2019 | | | | | | | | | | | |
Operating Revenues: | | | | | | | | | | | |
External customers | 109,272 | | | 65,602 | | | 32,845 | | | 1,805 | | | — | | | 209,524 | |
Intersegment | — | | | — | | | 98 | | | — | | | (98) | | | — | |
| 109,272 | | | 65,602 | | | 32,943 | | | 1,805 | | | (98) | | | 209,524 | |
Costs and Expenses: | | | | | | | | | | | |
Operating | 69,932 | | | 54,245 | | | 21,772 | | | 1,253 | | | (91) | | | 147,111 | |
Administrative and general | 10,198 | | | 3,356 | | | 6,402 | | | 839 | | | 5,951 | | | 26,746 | |
Depreciation and amortization | 10,337 | | | 5,725 | | | 206 | | | 489 | | | 379 | | | 17,136 | |
| 90,467 | | | 63,326 | | | 28,380 | | | 2,581 | | | 6,239 | | | 190,993 | |
Gains on Asset Dispositions | 17 | | | 420 | | | — | | | — | | | — | | | 437 | |
Operating Income (Loss) | 18,822 | | | 2,696 | | | 4,563 | | | (776) | | | (6,337) | | | 18,968 | |
Other Income (Expense): | | | | | | | | | | | |
| | | | | | | | | | | |
Foreign currency gains (losses), net | (47) | | | 459 | | | — | | | — | | | (7) | | | 405 | |
Other, net | (651) | | | — | | | (3) | | | — | | | 10 | | | (644) | |
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax | 111 | | | (2,472) | | | (67) | | | (90) | | | — | | | (2,518) | |
Segment Profit (Loss) | 18,235 | | | 683 | | | 4,493 | | | (866) | | | | | |
Other Income (Expense) not included in Segment Profit | | | | | | | | | | | (938) | |
Less Equity Losses included in Segment Profit | | | | | | | | | | | 2,518 | |
Income Before Taxes and Equity Losses | | | | | | | | | | | 17,791 | |
| | | | | | | | | | | |
Capital Expenditures | 247 | | | 5,237 | | | 20 | | | 145 | | | — | | | 5,649 | |
| | | | | | | | | | | |
As of March 31, 2019 | | | | | | | | | | | |
Property and Equipment: | | | | | | | | | | | |
Historical cost | 930,464 | | | 444,609 | | | 1,246 | | | 7,037 | | | 30,132 | | | 1,413,488 | |
Accumulated depreciation | (352,005) | | | (200,516) | | | (1,053) | | | (979) | | | (22,583) | | | (577,136) | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
Net property and equipment | 578,459 | | | 244,093 | | | 193 | | | 6,058 | | | 7,549 | | | 836,352 | |
Operating Lease Right-of-Use Assets | 125,640 | | | 36,534 | | | 987 | | | — | | | 4,164 | | | 167,325 | |
Investments, at Equity, and Advances to 50% or Less Owned Companies | 74,127 | | | 56,238 | | | 419 | | | 24,506 | | | — | | | 155,290 | |
Inventories | 2,042 | | | 2,183 | | | 366 | | | 323 | | | — | | | 4,914 | |
Goodwill | 1,852 | | | 2,362 | | | 28,506 | | | — | | | — | | | 32,720 | |
Intangible Assets | 8,633 | | | 8,618 | | | 6,411 | | | — | | | — | | | 23,662 | |
Other current and long-term assets, excluding cash and near cash assets(1) | 53,070 | | | 62,832 | | | 91,591 | | | 2,383 | | | 10,231 | | | 220,107 | |
Segment Assets | 843,823 | | | 412,860 | | | 128,473 | | | 33,270 | | | | | |
Cash and near cash assets(1) | | | | | | | | | | | 181,436 | |
| | | | | | | | | | | |
Total Assets | | | | | | | | | | | 1,621,806 | |
______________________
(1)Cash and near cash assets includes cash, cash equivalents, restricted cash, restricted cash equivalents, marketable securities and construction reserve funds.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ocean Services $’000 | | Inland Services $’000 | | Witt O’Brien’s $’000 | | Other $’000 | | Corporate and Eliminations $’000 | | Total $’000 |
For the three months ended March 31, 2019 | | | | | | | | | | | |
Revenues from Contracts with Customers: | | | | | | | | | | | |
Voyage charters | 9,314 | | | — | | | — | | | — | | | — | | | 9,314 | |
Contracts of affreightment | 3,730 | | | 48,984 | | | — | | | — | | | — | | | 52,714 | |
Tariff | 20,996 | | | — | | | — | | | — | | | — | | | 20,996 | |
Unit freight | 16,012 | | | — | | | — | | | — | | | — | | | 16,012 | |
Terminal operations | — | | | 5,480 | | | — | | | — | | | — | | | 5,480 | |
Fleeting operations | — | | | 4,070 | | | — | | | — | | | — | | | 4,070 | |
Logistics Services | — | | | 3,538 | | | — | | | — | | | — | | | 3,538 | |
Time and material contracts | — | | | — | | | 29,946 | | | — | | | — | | | 29,946 | |
Retainer contracts | — | | | — | | | 2,405 | | | — | | | — | | | 2,405 | |
Product sales(1) | — | | | — | | | — | | | 1,310 | | | — | | | 1,310 | |
Other | 934 | | | 902 | | | 592 | | | 255 | | | (98) | | | 2,585 | |
Lease Revenues: | | | | | | | | | | | |
Time charter, bareboat charter and rental income | 58,286 | | | 2,628 | | | — | | | 240 | | | — | | | 61,154 | |
| 109,272 | | | 65,602 | | | 32,943 | | | 1,805 | | | (98) | | | 209,524 | |
______________________
(1)Cost of goods sold related to product sales was $1.1 million.
| |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Form 10-Q includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Certain statements discussed in this Form 10-Q as well as in other reports, materials and oral statements that the Company releases from time to time constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “believe,” “plan,” “target,” “forecast” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements concern management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by management of the Company. These statements are not guarantees of future performance and actual events or results may differ significantly from these statements. Actual events or results are subject to significant known and unknown risks, uncertainties and other important factors, including risks relating to the COVID-19 pandemic, volatility the pandemic has caused in the capital markets and the effects it has had and could continue to have on the global economy, weakening demand for the Company’s services as a result of unplanned customer suspensions, cancellations, rate reductions or non-renewals of vessel charters or failures to finalize commitments to charter vessels, increased government legislation and regulation of the Company’s businesses that could increase the cost of operations, increased competition if the Jones Act is repealed, liability, legal fees and costs in connection with the provision of emergency response services, decreased demand for the Company’s services as a result of declines in the global economy, declines in valuations in the global financial markets and a lack of liquidity in the credit sectors, including, interest rate fluctuations, availability of credit, inflation rates, change in laws, trade barriers, commodity prices and currency exchange fluctuations, the cyclical nature of the oil and gas industry, activity in foreign countries and changes in foreign political, military and economic conditions, changes in foreign and domestic oil and gas exploration and production activity, safety record requirements related to Ocean Services, decreased demand for Ocean Services due to construction of additional refined petroleum product, natural gas or crude oil pipelines or due to decreased demand for refined petroleum products, crude oil or chemical products or a change in existing methods of delivery, compliance with U.S. and foreign government laws and regulations, including environmental laws and regulations and economic sanctions, the dependence of Ocean Services and Inland Services on several key customers, consolidation of the Company’s customer base, the ongoing need to replace aging vessels, industry fleet capacity, restrictions imposed by the Shipping Acts on the amount of foreign ownership of the Company’s Common Stock, operational risks of Ocean Services and Inland Services, effects of adverse weather conditions and seasonality, the level of grain export volume, the effect of fuel prices on barge towing costs, variability in freight rates for inland river barges, the effect of international economic and political factors on Inland Services’ operations, the ability to realize anticipated benefits from acquisitions and other strategic transactions, adequacy of insurance coverage, the attraction and retention of qualified personnel by the Company, changes in U.S. and international trade policies and various other matters and factors, many of which are beyond the Company’s control as well as those discussed in Item 1A (Risk Factors) of the Company’s Annual report on Form 10-K and other reports filed by the Company with the Securities and Exchange Commission (“SEC”). It should be understood that it is not possible to predict or identify all such factors. Consequently, the preceding should not be considered to be a complete discussion of all potential risks or uncertainties. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its filings with the SEC, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (if any). These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995.
Overview
The Company’s operations are divided into three main business segments – Ocean Transportation & Logistics Services (“Ocean Services”), Inland Transportation & Logistics Services (“Inland Services”) and Witt O’Brien’s. The Company also has activities that are referred to and described under Other that primarily includes CLEANCOR Energy Solutions LLC and its subsidiaries (collectively “Cleancor”), lending and leasing activities and noncontrolling investments in various other businesses.
Recent Developments
OnIn March 19, 2019,2020, the World Health Organization declared the outbreak of a novel coronavirus ("COVID-19") as a pandemic, which continues to spread throughout the United States and the world. The spread of COVID-19 has caused significant volatility in U.S. and international markets and there is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies.
The outbreak of COVID-19 has caused many governments to implement stay-at-home orders, quarantines and place significant restrictions on travel. Many of these governments have also implemented work restrictions that prohibit or limit non-essential businesses from conducting normal operations, which has required employees to work remotely if possible or be terminated or furloughed. The health and safety of the Company's employees and customers is and will continue to be its highest priority throughout the pandemic. The Company has implemented protective measures relating to its workforce including, but not limited to, health monitoring, personal protective equipment, and enhanced cleaning and sanitizing procedures among other measures recommended by various federal, state and local governments.
Through the first quarter, the Company's overall business, results of operations and financial condition have not been materially affected by the COVID-19 outbreak. In early April, two of the Company's subsidiaries began to be adversely affected as a result of reduced demand but there is too much uncertainty to know if the reduction in demand will be short lived or become more prolonged. The Company has implemented various temporary cost containment measures, including returning leased-in equipment to their owners, idling certain owned equipment, eliminating overtime and deferring planned repair and maintenance projects. The remainder of the Company's businesses have not been materially adversely affected. Witt O'Brien's, the Company's crisis and emergency management consulting business has experienced increased demand as a result of the COVID-19 pandemic, winning new customers and projects to assist both public and private sector clients in their recovery and resiliency efforts.
The Company continues to maintain a strong balance sheet and expects to meet all of its near-term maturities and capital commitments. As of March 31, 2020, the Company's cash, cash equivalents, restricted cash, restricted cash equivalents and marketable securities totaled $85.2 million, and the Company entered into a revolving credit agreement with a syndicate of lenders providing for borrowings ofhas the ability to borrow up to $125.0$225.0 million under undrawn credit facilities. The Company also expects to benefit from time-to-time (the “SEACOR Revolving Credit Facility”). The SEACOR Revolving Credit Facility contains customary financial and negative covenants, is secured by a pledge over allcertain provisions of the Company’sCoronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), most notably from being able to carryback net operating losses for up to five years resulting in income tax refunds of approximately $32 million once the refund requests are processed. The Company is continuing to monitor the impacts of the pandemic on its subsidiaries assets, subjectbusinesses, operations and financial condition, and in the future may consider implementing mitigation strategies to certain exceptions,protect its long-term sustainability.
The COVID-19 pandemic is, however, a dynamic and matures March 19, 2024.continuously evolving phenomenon and the ultimate severity of the outbreak is uncertain at this time. If the pandemic worsens, additional restrictions are implemented or current restrictions are imposed for a longer period of time to contain the outbreak, the Company may experience a material adverse effect on its businesses, results of operations and financial condition. For additional information See Part II Item 1A “Risk Factors.”
Consolidated Results of Operations
The sections below provide an analysis of the Company’s operations by business segment for the three months (“Current Year Quarter”) ended March 31, 20192020 compared with the three months (“Prior Year Quarter”) ended March 31, 2018.2019. See “Item 1. Financial Statements—Note 12.15. Segment Information” included in Part I of this Quarterly Report on Form 10-Q for consolidating segment tables for each period presented. Capitalized terms used and not specifically defined herein have the meaning given to those terms used in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.
2019.
Ocean Transportation & Logistics Services |
| | | | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
United States | 90,315 |
| | 83 |
| | 83,049 |
| | 81 |
|
Foreign | 18,957 |
| | 17 |
| | 19,335 |
| | 19 |
|
| 109,272 |
| | 100 |
| | 102,384 |
| | 100 |
|
Costs and Expenses: | | | | | | | |
Operating: | | | | | | | |
Personnel | 23,182 |
| | 21 |
| | 23,300 |
| | 23 |
|
Repairs and maintenance | 6,267 |
| | 6 |
| | 5,352 |
| | 5 |
|
Dry-docking | 2,831 |
| | 3 |
| | 2,166 |
| | 2 |
|
Insurance and loss reserves | 2,228 |
| | 2 |
| | 1,992 |
| | 2 |
|
Fuel, lubes and supplies | 7,789 |
| | 7 |
| | 8,512 |
| | 8 |
|
Leased-in equipment | 12,086 |
| | 11 |
| | 11,079 |
| | 11 |
|
Other | 15,549 |
| | 14 |
| | 12,932 |
| | 13 |
|
| 69,932 |
| | 64 |
| | 65,333 |
| | 64 |
|
Administrative and general | 10,198 |
| | 9 |
| | 10,549 |
| | 10 |
|
Depreciation and amortization | 10,337 |
| | 10 |
| | 12,645 |
| | 13 |
|
| 90,467 |
| | 83 |
| | 88,527 |
| | 87 |
|
Gains on Asset Dispositions | 17 |
| | — |
| | 1,883 |
| | 2 |
|
Operating Income | 18,822 |
| | 17 |
| | 15,740 |
| | 15 |
|
Other Income (Expense): | | | | | | | |
Foreign currency losses, net | (47 | ) | | — |
| | (51 | ) | | — |
|
Other, net | (651 | ) | | — |
| | 283 |
| | — |
|
Equity in Earnings of 50% or Less Owned Companies, Net of Tax | 111 |
| | — |
| | 315 |
| | 1 |
|
Segment Profit(1) | 18,235 |
| | 17 |
| | 16,287 |
| | 16 |
|
22
______________________ | |
(1) | Includes amounts attributable to both SEACOR and noncontrolling interests. See “Item 1. Financial Statements—Note 8. Noncontrolling Interests in Subsidiaries” included in Part I of this Quarterly Report on Form 10-Q. |
Ocean Transportation & Logistics Services
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Three Months Ended March 31, | | | | | | | | |
| | | | | | | | | | | 2020 | | | | | 2019 | | | |
| | | | | | | | | | | $’000 | | % | | | $’000 | | % | |
Operating Revenues: | | | | | | | | | | | | | | | | | | | |
United States | | | | | | | | | | | 86,886 | | | 82 | | | | 90,315 | | | 83 | | |
Foreign | | | | | | | | | | | 19,229 | | | 18 | | | | 18,957 | | | 17 | | |
| | | | | | | | | | | 106,115 | | | 100 | | | | 109,272 | | | 100 | | |
Costs and Expenses: | | | | | | | | | | | | | | | | | | | |
Operating: | | | | | | | | | | | | | | | | | | | |
Personnel | | | | | | | | | | | 23,296 | | | 22 | | | | 23,182 | | | 21 | | |
Repairs and maintenance | | | | | | | | | | | 6,702 | | | 6 | | | | 6,267 | | | 6 | | |
Dry-docking | | | | | | | | | | | 9,520 | | | 9 | | | | 2,831 | | | 3 | | |
Insurance and loss reserves | | | | | | | | | | | 1,650 | | | 2 | | | | 2,228 | | | 2 | | |
Fuel, lubes and supplies | | | | | | | | | | | 9,571 | | | 9 | | | | 7,789 | | | 7 | | |
Leased-in equipment | | | | | | | | | | | 11,585 | | | 11 | | | | 12,086 | | | 11 | | |
Other | | | | | | | | | | | 15,280 | | | 14 | | | | 15,549 | | | 14 | | |
| | | | | | | | | | | 77,604 | | | 73 | | | | 69,932 | | | 64 | | |
Administrative and general | | | | | | | | | | | 10,744 | | | 10 | | | | 10,198 | | | 9 | | |
Depreciation and amortization | | | | | | | | | | | 10,282 | | | 10 | | | | 10,337 | | | 10 | | |
| | | | | | | | | | | 98,630 | | | 93 | | | | 90,467 | | | 83 | | |
Gains on Asset Dispositions | | | | | | | | | | | 9 | | | — | | | | 17 | | | — | | |
Operating Income | | | | | | | | | | | 7,494 | | | 7 | | | | 18,822 | | | 17 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Foreign currency losses, net | | | | | | | | | | | (78) | | | — | | | | (47) | | | — | | |
Other, net | | | | | | | | | | | 22 | | | — | | | | (651) | | | — | | |
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax | | | | | | | | | | | (1,357) | | | (1) | | | | 111 | | | — | | |
Segment Profit(1) | | | | | | | | | | | 6,081 | | | 6 | | | | 18,235 | | | 17 | | |
______________________
(1)Includes amounts attributable to both SEACOR and noncontrolling interests. See “Item 1. Financial Statements—Note 11. Noncontrolling Interests in Subsidiaries” included in Part I of this Quarterly Report on Form 10-Q.
Operating Revenues by Service Line. The table below sets forth, for the periods indicated, operating revenues by service line.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Three Months Ended March 31, | | | | | | |
| | | | | | | | | 2020 | | | | 2019 | | |
| | | | | | | | | $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | | | | | | | |
Petroleum and chemical: | | | | | | | | | | | | | | | |
Time charter | | | | | | | | | 15,926 | | | 15 | | | 30,256 | | | 28 | |
Bareboat charter | | | | | | | | | 10,150 | | | 9 | | | 7,411 | | | 7 | |
| | | | | | | | | | | | | | | |
Voyage charter | | | | | | | | | 2,590 | | | 2 | | | — | | | — | |
Dry bulk: | | | | | | | | | | | | | | | |
Contracts of affreightment | | | | | | | | | 4,496 | | | 4 | | | 3,730 | | | 3 | |
Voyage charter | | | | | | | | | 4,032 | | | 4 | | | 2,113 | | | 2 | |
Port & Infrastructure Services: | | | | | | | | | | | | | | | |
Tariff | | | | | | | | | 22,571 | | | 21 | | | 20,996 | | | 19 | |
Time charter | | | | | | | | | 1,785 | | | 2 | | | 1,299 | | | 1 | |
Bareboat charter | | | | | | | | | 1,633 | | | 2 | | | 1,782 | | | 2 | |
Logistics Services: | | | | | | | | | | | | | | | |
Time charter(1) | | | | | | | | | 16,119 | | | 15 | | | 17,538 | | | 16 | |
Voyage charter | | | | | | | | | 9,415 | | | 9 | | | 7,201 | | | 7 | |
Unit freight | | | | | | | | | 16,448 | | | 16 | | | 16,012 | | | 15 | |
Managed Services | | | | | | | | | 950 | | | 1 | | | 934 | | | — | |
| | | | | | | | | 106,115 | | | 100 | | | 109,272 | | | 100 | |
|
| | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Petroleum and chemical: | | | | | | | |
Time charter | 30,256 |
| | 28 | | 25,511 |
| | 25 |
Bareboat charter | 7,411 |
| | 7 | | 9,050 |
| | 9 |
Voyage charter | — |
| | — | | 5,106 |
| | 5 |
Dry bulk: | | | | | | | |
Contracts of affreightment | 3,730 |
| | 3 | | 5,006 |
| | 5 |
Voyage charter | 2,113 |
| | 2 | | 2,579 |
| | 2 |
Port & Infrastructure Services: | | | | | | | |
Tariff | 20,996 |
| | 19 | | 18,001 |
| | 18 |
Time charter | 1,299 |
| | 1 | | 1,351 |
| | 1 |
Bareboat charter | 1,782 |
| | 2 | | 1,822 |
| | 2 |
Logistics Services: | | | | | | | |
Time charter(1) | 17,538 |
| | 16 | | 10,906 |
| | 11 |
Voyage charter | 7,201 |
| | 7 | | 8,816 |
| | 8 |
Unit freight | 16,012 |
| | 15 | | 13,384 |
| | 13 |
Managed services | 934 |
| | — | | 852 |
| | 1 |
| 109,272 |
| | 100 | | 102,384 |
| | 100 |
______________________________________________ | |
(1) | (1)Includes MSP revenues of $3.1 million and $5.0 million for the three months ended March 31, 2019 and 2018, respectively. |
Operating Revenues. Operating revenues were $6.9of $3.9 million higher inand $3.1 million for the three months ended March 31, 2020 and 2019, respectively.
Current Year Quarter compared with the Prior Year Quarter.Quarter
Operating Revenues. Operating revenues were $3.2 million lower.
Operating revenues from bulk transportation services were $3.7$6.3 million lower in the Current Year Quarter compared with the Prior Year Quarter.
lower. Operating revenues from petroleum and chemical transportation services were $2.0 million lower primarily due to the return of one previously leased-in U.S.-flag petroleum and chemical carrier in the Current Year Quarter and the sale of another U.S.-flag petroleum and chemical carrier in the Prior Year Quarter. These decreases were partially offset by an increase in the time charter rate for one U.S.-flag petroleum and chemical carrier in the Current Year Quarter and a change in contract status from voyage charter to time charter in the fourth quarter of 2018 for another U.S.-flag petroleum and chemical carrier.
Operating revenues from dry bulk transportation were $1.7$9.0 million lower primarily due to out-of-service time for repairsa regulatory dry-docking, a change in contract status from time charter to bareboat charter in December 2019 for one U.S.-flag petroleum and chemical carrier and the commencement and extension of two time charters at rates lower than the previous charter for two other U.S.-flag petroleum and chemical carriers. These decreases were partially offset by one additional operating day in the Current Year Quarter. Operating revenues from dry-bulk transportation were $2.7 million higher primarily due to out-of-service time for mobilization following the regulatory dry-docking of one U.S.-flag bulk carrier.carrier in the Prior Year Quarter.
Operating revenues from port and infrastructure services were $2.9$1.9 million higher primarily due to an increase in harbor towing tariff revenues primarily due to higher port traffic.activities.
Operating revenues from logistics services were $7.6$1.2 million higher primarily due to an increase inhigher military and commercial cargo activity and an increase in unit freight shipping demand.for PCTCs.
Operating Expenses.Expenses. Operating expenses were $4.6$7.7 million higher primarily due to regulatory dry-docking costs for one U.S.-flag petroleum and chemical carrier and five U.S.-flag harbor tugs, partially offset by lower dry-docking costs for PCTCs and lower overall operating costs for another U.S.-flag petroleum and chemical carrier following a change in contract status from time charter to bareboat charter during December 2019.
Administrative and General. Administrative and general expenses were $0.5 million higher primarily due to higher facility and information technology costs, partially offset by lower compensation costs.
Operating Income. Operating income as a percentage of operating revenues was 7% in the Current Year Quarter compared with 17% in the Prior Year QuarterQuarter. The decrease was primarily due to the regulatory dry-docking of one PCTC and one short-sea container/RORO vessel, higher voyage costs for PCTCs and higher leased-in equipment costs for harbor tugs associated with the increased revenues. These increases werelower operating revenues partially offset by lower operating expenses from a change in contract status, lower operating revenues from the returncommencement and extension of one leased-intwo time charters at lower rates, and higher dry-docking costs for certain U.S.-flag petroleum and chemical carriercarriers and U.S.-flag harbor tugs.
Equity in the Current Year Quarter, the saleEarnings (Losses) of one U.S.-flag petroleum and chemical carrier50% or Less Owned Companies, Net of Tax. The Company recognized equity in the Prior Year Quarter and lower dry-docking activity for U.S.-flag bulk carriers.
Administrative and General. Administrative and general expenses were $0.4losses of 50% or less owned companies, net of tax, of $1.4 million lower in the Current Year Quarter compared with equity in earnings of 50% or less owned companies, net of tax, of $0.1 million in the Prior Year Quarter primarily due to lower legal and professional fees.
Depreciation and Amortization. Depreciation and amortization expenses were $2.3 million lowerearnings from Trailer Bridge associated with decreased demand in the Current Year Quarter compared withPuerto Rico liner trade and losses from the Prior Year Quarter primarily due to the U.S.-flag bulk carriers being fully depreciated during 2018.
Gains on Asset Dispositions. During the Prior Year Quarter, the Company sold one U.S.-flag petroleum and chemical carrier, one U.S.-flag harbor tug and other equipment for net proceeds of $5.0 million and gains of $1.9 million.
Operating Income. Excluding gains on asset dispositions, operating income as a percentage of operating revenues was 17% in the Current Year Quarter compared with 13% in the Prior Year Quarter. The improvement was primarily due toCompany’s rail ferry joint ventures, partially offset by an increase in the time charter rate for one U.S.-flag petroleum and chemical carrier in the Current Year Quarter and higher revenues for PCTCs, partially offset by higher regulatory dry-docking costs.earnings from KSM.
Fleet Count
The composition of Ocean Services’ fleet as of March 31 was as follows:
| | | | | | | | | | | | | | | | | | | | | | | |
| Owned | | Leased-in | | Joint Ventured | | Total |
2020 | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Petroleum and chemical carriers - U.S.-flag | 7 | | | 2 | | | — | | | 9 | |
Bulk carriers - U.S.-flag | 2 | | | — | | | — | | | 2 | |
Port & Infrastructure Services: | | | | | | | |
Harbor tugs - U.S.-flag | 20 | | | 5 | | | — | | | 25 | |
Harbor tugs - Foreign-flag | 6 | | | — | | | 2 | | | 8 | |
Offshore tugs - U.S.-flag | 1 | | | — | | | — | | | 1 | |
Ocean liquid tank barges - U.S.-flag | 5 | | | — | | | — | | | 5 | |
Ocean liquid tank barges - Foreign-flag | — | | | — | | | 1 | | | 1 | |
Specialty vessels - Foreign-flag(1) | — | | | — | | | 2 | | | 2 | |
Logistics Services: | | | | | | | |
PCTC(2) - U.S.-flag | — | | | 4 | | | — | | | 4 | |
Short-sea container/RORO(3) vessels - Foreign-flag | 8 | | | — | | | — | | | 8 | |
RORO(3) & deck barges - U.S.-flag | — | | | — | | | 7 | | | 7 | |
Rail ferries - Foreign-flag | — | | | — | | | 2 | | | 2 | |
| 49 | | | 11 | | | 14 | | | 74 | |
2019 | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Petroleum and chemical carriers - U.S.-flag | 7 | | | 2 | | | — | | | 9 | |
Bulk carriers - U.S.-flag | 2 | | | — | | | — | | | 2 | |
Port & Infrastructure Services: | | | | | | | |
Harbor tugs - U.S.-flag | 19 | | | 5 | | | — | | | 24 | |
Harbor tugs - Foreign-flag | 6 | | | — | | | 2 | | | 8 | |
Offshore tugs - U.S.-flag | 1 | | | — | | | — | | | 1 | |
Ocean liquid tank barges - U.S.-flag | 5 | | | — | | | — | | | 5 | |
Ocean liquid tank barges - Foreign-flag | — | | | — | | | 1 | | | 1 | |
Specialty vessels - Foreign-flag(4) | — | | | — | | | 1 | | | 1 | |
Logistics Services: | | | | | | | |
PCTC(2) - U.S.-flag | — | | | 4 | | | — | | | 4 | |
Short-sea container/RORO(3) vessels - Foreign-flag | 9 | | | — | | | — | | | 9 | |
RORO(3) & deck barges - U.S.-flag | — | | | — | | | 7 | | | 7 | |
Rail ferries - Foreign-flag | — | | | — | | | 2 | | | 2 | |
| 49 | | | 11 | | | 13 | | | 73 | |
|
| | | | | | | | | | | |
| Owned | | Leased-in | | Joint Ventured | | Total |
2019 | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Petroleum and chemical carriers - U.S.-flag | 7 |
| | 2 |
| | — |
| | 9 |
|
Bulk carriers - U.S.-flag | 2 |
| | — |
| | — |
| | 2 |
|
Port & Infrastructure Services: | | | | | | |
|
Harbor tugs - U.S.-flag | 19 |
| | 5 |
| | — |
| | 24 |
|
Harbor tugs - Foreign-flag | 6 |
| | — |
| | 2 |
| | 8 |
|
Offshore tugs - U.S.-flag | 1 |
| | — |
| | — |
| | 1 |
|
Ocean liquid tank barges - U.S.-flag | 5 |
| | — |
| | — |
| | 5 |
|
Ocean liquid tank barges - Foreign-flag | — |
| | — |
| | 1 |
| | 1 |
|
Specialty vessel - Foreign-flag(1) | — |
| | — |
| | 1 |
| | 1 |
|
Logistics Services: | | | | | | |
|
PCTC(2) - U.S.-flag | — |
| | 4 |
| | — |
| | 4 |
|
Short-sea container/RORO(3) vessels - Foreign-flag | 9 |
| | — |
| | — |
| | 9 |
|
RORO(3) & deck barges - U.S.-flag | — |
| | — |
| | 7 |
| | 7 |
|
Rail ferries - Foreign-flag | — |
| | — |
| | 2 |
| | 2 |
|
| 49 |
| | 11 |
| | 13 |
| | 73 |
|
2018 | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Petroleum and chemical carriers - U.S.-flag | 7 |
| | 3 |
| | — |
| | 10 |
|
Bulk carriers - U.S.-flag | 2 |
| | — |
| | — |
| | 2 |
|
Port & Infrastructure Services: | | | | | | |
|
Harbor tugs - U.S.-flag | 15 |
| | 8 |
| | — |
| | 23 |
|
Harbor tugs - Foreign-flag | 6 |
| | — |
| | 2 |
| | 8 |
|
Offshore tugs - U.S.-flag | 1 |
| | — |
| | — |
| | 1 |
|
Ocean liquid tank barges - U.S.-flag | 5 |
| | — |
| | — |
| | 5 |
|
Ocean liquid tank barges - Foreign-flag | — |
| | — |
| | 1 |
| | 1 |
|
Logistics Services: | | | | | | |
|
PCTC(2) - U.S.-flag | — |
| | 4 |
| | — |
| | 4 |
|
Short-sea container/RORO(3) vessels - Foreign-flag | 9 |
| | — |
| | — |
| | 9 |
|
RORO(3) & deck barges - U.S.-flag | — |
| | — |
| | 7 |
| | 7 |
|
Rail ferries - Foreign-flag | — |
| | — |
| | 2 |
| | 2 |
|
| 45 |
| | 15 |
| | 12 |
| | 72 |
|
____________________________________________(1)One line handling and one crew transport vessel.
| |
(2) | Pure Car/Truck Carrier. |
(2)Pure Car/Truck Carrier.
(3)Roll On/Roll Off.
(4)One line handling vessel.
Inland Transportation & Logistics Services |
| | | | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
United States | 63,612 |
| | 97 |
| | 53,738 |
| | 96 |
|
Foreign | 1,990 |
| | 3 |
| | 2,183 |
| | 4 |
|
| 65,602 |
| | 100 |
| | 55,921 |
| | 100 |
|
Costs and Expenses: | | | | | | | |
Operating: | | | | | | | |
Barge logistics | 33,585 |
| | 51 |
| | 34,128 |
| | 61 |
|
Personnel | 4,571 |
| | 7 |
| | 4,616 |
| | 8 |
|
Repairs and maintenance | 1,214 |
| | 2 |
| | 1,540 |
| | 3 |
|
Insurance and loss reserves | 1,016 |
| | 2 |
| | 645 |
| | 1 |
|
Fuel, lubes and supplies | 1,811 |
| | 3 |
| | 1,880 |
| | 4 |
|
Leased-in equipment | 3,611 |
| | 6 |
| | 1,870 |
| | 3 |
|
Other | 4,218 |
| | 6 |
| | 3,388 |
| | 6 |
|
Net barge pool earnings attributable to third parties | 4,219 |
| | 6 |
| | 114 |
| | — |
|
| 54,245 |
| | 83 |
| | 48,181 |
| | 86 |
|
Administrative and general | 3,356 |
| | 5 |
| | 3,312 |
| | 6 |
|
Depreciation and amortization | 5,725 |
| | 9 |
| | 6,234 |
| | 11 |
|
| 63,326 |
| | 97 |
| | 57,727 |
| | 103 |
|
Gains on Asset Dispositions | 420 |
| | 1 |
| | 5,162 |
| | 9 |
|
Operating Income | 2,696 |
| | 4 |
| | 3,356 |
| | 6 |
|
Other Income: | | | | | | | |
Foreign currency gains, net | 459 |
| | 1 |
| | 1,703 |
| | 3 |
|
Equity in Losses of 50% or Less Owned Companies, Net of Tax | (2,472 | ) | | (4 | ) | | (2,454 | ) | | (4 | ) |
Segment Profit(1) | 683 |
| | 1 |
| | 2,605 |
| | 5 |
|
25
______________________ | |
(1) | Includes amounts attributable to both SEACOR and noncontrolling interests. See “Item 1. Financial Statements—Note 8. Noncontrolling Interests in Subsidiaries” included in Part I of this Quarterly Report on Form 10-Q. |
Inland Transportation & Logistics Services
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Three Months Ended March 31, | | | | | | | | |
| | | | | | | | | | | 2020 | | | | | 2019 | | | |
| | | | | | | | | | | $’000 | | % | | | $’000 | | % | |
Operating Revenues: | | | | | | | | | | | | | | | | | | | |
United States | | | | | | | | | | | 59,797 | | | 98 | | | | 63,612 | | | 97 | | |
Foreign | | | | | | | | | | | 1,514 | | | 2 | | | | 1,990 | | | 3 | | |
| | | | | | | | | | | 61,311 | | | 100 | | | | 65,602 | | | 100 | | |
Costs and Expenses: | | | | | | | | | | | | | | | | | | | |
Operating: | | | | | | | | | | | | | | | | | | | |
Barge logistics | | | | | | | | | | | 32,799 | | | 53 | | | | 33,585 | | | 51 | | |
Personnel | | | | | | | | | | | 5,405 | | | 9 | | | | 4,571 | | | 7 | | |
Repairs and maintenance | | | | | | | | | | | 1,711 | | | 3 | | | | 1,214 | | | 2 | | |
Insurance and loss reserves | | | | | | | | | | | 722 | | | 1 | | | | 1,016 | | | 2 | | |
Fuel, lubes and supplies | | | | | | | | | | | 1,535 | | | 2 | | | | 1,811 | | | 3 | | |
Leased-in equipment | | | | | | | | | | | 3,081 | | | 5 | | | | 3,611 | | | 6 | | |
Other | | | | | | | | | | | 3,493 | | | 6 | | | | 4,218 | | | 6 | | |
Net barge pool earnings attributable to third parties | | | | | | | | | | | 2,173 | | | 4 | | | | 4,219 | | | 6 | | |
| | | | | | | | | | | 50,919 | | | 83 | | | | 54,245 | | | 83 | | |
Administrative and general | | | | | | | | | | | 3,488 | | | 6 | | | | 3,356 | | | 5 | | |
Depreciation and amortization | | | | | | | | | | | 6,212 | | | 10 | | | | 5,725 | | | 9 | | |
| | | | | | | | | | | 60,619 | | | 99 | | | | 63,326 | | | 97 | | |
Gains on Asset Dispositions, Net | | | | | | | | | | | 315 | | | 1 | | | | 420 | | | 1 | | |
Operating Income | | | | | | | | | | | 1,007 | | | 2 | | | | 2,696 | | | 4 | | |
Other Income: | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Foreign currency gains (losses), net | | | | | | | | | | | (4,478) | | | (7) | | | | 459 | | | 1 | | |
| | | | | | | | | | | | | | | | | | | |
Equity in Losses of 50% or Less Owned Companies, Net of Tax | | | | | | | | | | | (3,376) | | | (6) | | | | (2,472) | | | (4) | | |
Segment Profit (Loss)(1) | | | | | | | | | | | (6,847) | | | (11) | | | | 683 | | | 1 | | |
______________________
(1)Includes amounts attributable to both SEACOR and noncontrolling interests.
Operating Revenues by Service Line. The table below sets forth, for the periods indicated, operating revenues by service line.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Three Months Ended March 31, | | | | | | |
| | | | | | | | | 2020 | | | | 2019 | | |
| | | | | | | | | $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | | | | | | | |
Dry-cargo barge pools(1) | | | | | | | | | 42,189 | | | 69 | | | 46,993 | | | 72 | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
International liquid tank barge operations | | | | | | | | | 1,514 | | | 3 | | | 1,991 | | | 3 | |
Boat, specialty barge and other operations | | | | | | | | | 2,074 | | | 3 | | | 1,636 | | | 2 | |
Port & Infrastructure Services: | | | | | | | | | | | | | | | |
Terminal operations | | | | | | | | | 6,058 | | | 10 | | | 5,807 | | | 9 | |
Fleeting operations | | | | | | | | | 5,041 | | | 8 | | | 4,736 | | | 7 | |
Machine shop and shipyard | | | | | | | | | 673 | | | 1 | | | 427 | | | 1 | |
Logistics Services | | | | | | | | | 3,287 | | | 5 | | | 3,538 | | | 5 | |
Managed Services | | | | | | | | | 475 | | | 1 | | | 474 | | | 1 | |
| | | | | | | | | 61,311 | | | 100 | | | 65,602 | | | 100 | |
|
| | | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
Bulk Transportation Services: | | | | | | | |
Dry-cargo barge pools(1) | 46,993 |
| | 72 | | 38,107 |
| | 68 |
|
Charter-out of dry-cargo barges | — |
| | — | | 5 |
| | — |
|
International liquid tank barge operations | 1,991 |
| | 3 | | 2,183 |
| | 4 |
|
Boat, specialty barge and other operations | 1,636 |
| | 2 | | 891 |
| | 2 |
|
Port & Infrastructure Services: | | | | | | | |
Terminal operations | 5,807 |
| | 9 | | 6,164 |
| | 11 |
|
Fleeting operations | 4,736 |
| | 7 | | 4,853 |
| | 9 |
|
Machine shop and shipyard | 427 |
| | 1 | | 432 |
| | — |
|
Logistics services | 3,538 |
| | 5 | | 2,815 |
| | 5 |
|
Managed services | 474 |
| | 1 | | 471 |
| | 1 |
|
| 65,602 |
| | 100 | | 55,921 |
| | 100 |
|
____________________________________________ | |
(1) | Operating revenues for the three months ended March 31, 2019 and 2018 includes $20.2 million and $15.4 million, respectively, attributable to third-party barge owners participating in dry-cargo barge pools managed by the Company. |
Operating Revenues. (1)Operating revenues were $9.7for the three months ended March 31, 2020 and 2019, includes $17.0 million higherand $20.2 million, respectively, attributable to third-party barge owners participating in dry-cargo barge pools managed by the Company.
Current Year Quarter compared with the Prior Year Quarter.Quarter
Operating Revenues. Operating revenues were $4.3 million lower.
Operating revenues from bulk transportation services were $9.4$4.8 million higher in the Current Year Quarter compared with the Prior Year Quarter.lower. Operating revenues from the dry-cargo barge pools were $8.9$4.8 million higherlower resulting from a 4% decline in U.S. grain exports from the Center Gulf reducing demand for barge freight and driving down rates. The primary causes for the decline in demand were the continuing trade war with China, U.S. farm subsidy programs which were a disincentive to exports and competition from South America as a result of a stronger U.S. dollar. Operating revenues from international liquid tank barge operations were $0.4 million lower primarily due to higher freight ratestwo towboats being out of service for scheduled maintenance and more demurrage and storage revenues as a consequence of difficult operating conditions on the U.S. inland waterways resulting from ice and high water. In addition, the dry-cargo barge pools increased the number of barges chartered out to third parties that were used to move frac sand.lower volumes transported. Operating revenues from boat, specialty barge and other operations were $0.7$0.4 million higher primarily due to placing an additional towboat into service during the adoptionfourth quarter of the new lease accounting standard.2019.
Operating revenues from port and infrastructure services were $0.5$0.8 million lower in the Current Year Quarter compared with the Prior Year Quarter.higher. Operating revenues from terminal operations and fleeting operations were $0.4$0.3 million lowerand $0.3 million higher, respectively, primarily due to improved operating conditions compared with the expiration of a long-term liquid terminal contract during theprior year, which were impacted by high water and flooding. Operating revenues from machine and shipyard services were $0.2 million higher primarily due to an increase in repairs for third quarter of 2018.parties.
Operating revenues from logistics services were $0.7$0.3 million higher in the Current Year Quarter compared with the Prior Year Quarterlower primarily due to an increasea decrease in container movements.movements.
Operating Expenses.Expenses. Operating expenses were $6.1$3.3 million higher in the Current Year Quarter compared with the Prior Year Quarter.lower. Barge logistics expenses were $0.5$0.8 million lower primarily due to lower towing and switching costs as a consequenceresult of poor operating conditions onhigh water and flooding in the U.S. Inland Waterways. RepairsPrior Year Quarter partially offset by higher towing costs in the Current Year Quarter. Personnel costs were $0.8 million higher primarily due to crewing costs associated with the additional towboat placed in service for logistics services during the fourth quarter of 2019 and higher terminal throughput. Repair and maintenance costs were $0.5 million higher primarily due to equipment repairs at the terminal operations. Insurance and loss reserves were $0.3 million lower primarily due to fewer unscheduled repairs in the Current Year Quarter. Insuranceinsurance claims. Fuel, lubes and loss reservessupplies were $0.4$0.3 million higherlower primarily due to higher insurance claims deductibles accrued in the Current Year Quarter.reduced materials consumed for third party repair work and lower fuel expense. Leased-in equipment expense was $1.7$0.5 million higherlower primarily due to a decrease in outside barge freight and the adoptionreturn of a time chartered-in towboat in the new lease accounting standard.fourth quarter of 2019. Other operating expenses were $0.8$0.7 million higherlower primarily due to increaseddecreased container movements.
Depreciation and Amortization. Depreciation and amortization expenses were $0.5 million lowerhigher primarily due to placing a newly built towboat into service in the fourth quarter of 2019.
Gains on Asset Dispositions. During the Current Year Quarter compared withand during the Prior Year Quarter as a result of certain liquid terminal assets being fully depreciated during 2018.
Gains on Asset Dispositions. During the Current Year Quarter, the Company recognized previously deferred gains of $0.3 million. During the Prior Year Quarter, the Company sold 32 dry-cargo barges, two specialty barges and other equipment for net proceeds of $10.8 million and gains of $4.6 million, all of which were recognized currently. In addition, the Company recognized previously deferred gains of $0.5 million.
Operating Income. Excluding the impact of gains on asset dispositions, operating income as a percentage of operating revenues was 3%1% in the Current Year Quarter compared with operating loss as a percentage of operating revenues of 3% in the Prior Year Quarter. The improvementdecline was primarily due to higherlower earnings from the dry-cargo barge pools.
Foreign currency gains (losses), net. During the Current Year Quarter and Prior Year Quarter, foreignForeign currency gains (losses), net in all periods were primarily due to a strengtheningmovements in the exchange rate of the Colombian peso in relation to the U.S. dollar underlying certain of the Company’s intercompany lease obligations.
Equity in Losses of 50% or Less Owned Companies, Net of Tax. Equity in losses of 50% or less owned companies, net of tax, were $0.9 million lower. Equity in losses for SCF Bunge Marine were $0.6 million higher primarily due to unscheduled towboat repair costs and placing a newly built towboat in service during the fourth quarter of 2019. Equity in losses for Bunge-SCF Grain were $0.4 million lower primarily due to higher grain volumes handled at its facilities. Equity in losses for SCFCo Holdings LLC were $0.5 million higher primarily due to a reduction in volumes due to lower water levels and less market demand.
Fleet Count
The composition of Inland Services’ fleet as of March 31 was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Owned | | Leased-in | | Joint Ventured | | Pooled | | Total | | |
2020 | | | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | | | |
Dry-cargo barges | 591 | | | 50 | | | 258 | | | 473 | | | 1,372 | | | |
Liquid tank barges | 20 | | | — | | | — | | | — | | | 20 | | | |
Specialty barges | 5 | | | — | | | — | | | — | | | 5 | | | |
Towboats: | | | | | | | | | | | |
4,000 hp - 6,600 hp | 4 | | | 4 | | | 11 | | | — | | | 19 | | | |
3,300 hp - 3,900 hp | 1 | | | — | | | 2 | | | — | | | 3 | | | |
Less than 3,300 hp | 2 | | | — | | | — | | | — | | | 2 | | | |
Port & Infrastructure Services: | | | | | | | | | | | |
Harbor boats: | | | | | | | | | | | |
1,100 hp - 2,000 hp | 12 | | | 6 | | | — | | | — | | | 18 | | | |
Less than 1,100 hp | 6 | | | — | | | — | | | — | | | 6 | | | |
Logistics Services: | | | | | | | | | | | |
Dry-cargo barges | 20 | | | — | | | — | | | 15 | | | 35 | | | |
Towboats: | | | | | | | | | | | |
Less than 3,300 hp | 1 | | | — | | | — | | | — | | | 1 | | | |
| 662 | | | 60 | | | 271 | | | 488 | | | 1,481 | | | |
2019 | | | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | | | |
Dry-cargo barges | 586 | | | 48 | | | 258 | | | 482 | | | 1,374 | | | |
Liquid tank barges | 20 | | | — | | | — | | | — | | | 20 | | | |
Specialty barges | 5 | | | — | | | — | | | — | | | 5 | | | |
Towboats: | | | | | | | | | | | |
4,000 hp - 6,600 hp | 3 | | | 4 | | | 11 | | | — | | | 18 | | | |
3,300 hp - 3,900 hp | 1 | | | — | | | 2 | | | — | | | 3 | | | |
Less than 3,300 hp | 2 | | | — | | | — | | | — | | | 2 | | | |
Port & Infrastructure Services: | | | | | | | | | | | |
Harbor boats: | | | | | | | | | | | |
1,100 hp - 2,000 hp | 12 | | | 6 | | | — | | | — | | | 18 | | | |
Less than 1,100 hp | 6 | | | — | | | — | | | — | | | 6 | | | |
Logistics Services: | | | | | | | | | | | |
Dry-cargo barges | 25 | | | 2 | | | — | | | 6 | | | 33 | | | |
| 660 | | | 60 | | | 271 | | | 488 | | | 1,479 | | | |
|
| | | | | | | | | | | | | | |
| Owned | | Leased-in | | Joint Ventured | | Pooled | | Total |
2019 | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | |
Dry-cargo barges | 586 |
| | 48 |
| | 258 |
| | 482 |
| | 1,374 |
|
Liquid tank barges | 20 |
| | — |
| | — |
| | — |
| | 20 |
|
Specialty barges | 5 |
| | — |
| | — |
| | — |
| | 5 |
|
Towboats: | | | | | | | | | |
4,000 hp - 6,600 hp | 3 |
| | 4 |
| | 11 |
| | — |
| | 18 |
|
3,300 hp - 3,900 hp | 1 |
| | — |
| | 2 |
| | — |
| | 3 |
|
Less than 3,200 hp | 2 |
| | — |
| | — |
| | — |
| | 2 |
|
Port & Infrastructure Services: | | | | | | | | | |
Harbor boats: | | | | | | | | | |
1,100 hp - 2,000 hp | 12 |
| | 6 |
| | — |
| | — |
| | 18 |
|
Less than 1,100 hp | 6 |
| | — |
| | — |
| | — |
| | 6 |
|
Logistics Services: | | | | | | | | | |
Dry-cargo barges | 25 |
| | 2 |
| | — |
| | 6 |
| | 33 |
|
| 660 |
| | 60 |
| | 271 |
| | 488 |
| | 1,479 |
|
2018 | | | | | | | | | |
Bulk Transportation Services: | | | | | | | | | |
Dry-cargo barges | 584 |
| | 48 |
| | 258 |
| | 488 |
| | 1,378 |
|
Liquid tank barges | 20 |
| | — |
| | — |
| | — |
| | 20 |
|
Specialty barges | 5 |
| | — |
| | — |
| | — |
| | 5 |
|
Towboats: | | | | | | | | | |
4,000 hp - 6,600 hp | 3 |
| | 4 |
| | 11 |
| | — |
| | 18 |
|
3,300 hp - 3,900 hp | 1 |
| | — |
| | 2 |
| | — |
| | 3 |
|
Less than 3,200 hp | 2 |
| | — |
| | — |
| | — |
| | 2 |
|
Port & Infrastructure Services: | | | | | | | | | |
Harbor boats: | | | | | | | | | |
1,100 hp - 2,000 hp | 11 |
| | 6 |
| | — |
| | — |
| | 17 |
|
Less than 1,100 hp | 7 |
| | — |
| | — |
| | — |
| | 7 |
|
Logistics Services: | | | | | | | | | |
Dry-cargo barges | 27 |
| | 2 |
| | — |
| | 1 |
| | 30 |
|
| 660 |
| | 60 |
| | 271 |
| | 489 |
| | 1,480 |
|
Witt O'Brien's | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Three Months Ended March 31, | | | | | | |
| | | | | | | | | 2020 | | | | 2019 | | |
| | | | | | | | | $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | | | | | | | | | |
United States | | | | | | | | | 21,074 | | | 94 | | | 32,640 | | | 99 | |
Foreign | | | | | | | | | 1,432 | | | 6 | | | 303 | | | 1 | |
| | | | | | | | | 22,506 | | | 100 | | | 32,943 | | | 100 | |
Costs and Expenses: | | | | | | | | | | | | | | | |
Operating | | | | | | | | | 15,691 | | | 70 | | | 21,772 | | | 66 | |
Administrative and general | | | | | | | | | 7,679 | | | 34 | | | 6,402 | | | 19 | |
Depreciation and amortization | | | | | | | | | 259 | | | 1 | | | 206 | | | 1 | |
| | | | | | | | | 23,629 | | | 105 | | | 28,380 | | | 86 | |
| | | | | | | | | | | | | | | |
Operating Income (Loss) | | | | | | | | | (1,123) | | | (5) | | | 4,563 | | | 14 | |
Other Income: | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Foreign currency gains, net | | | | | | | | | 12 | | | — | | | — | | | — | |
Other, net | | | | | | | | | 70 | | | — | | | (3) | | | — | |
Equity in Losses of 50% or Less Owned Companies, Net of Tax | | | | | | | | | (8) | | | — | | | (67) | | | — | |
Segment Profit (Loss) | | | | | | | | | (1,049) | | | (5) | | | 4,493 | | | 14 | |
Current Year Quarter compared with Prior Year Quarter Witt O'Brien's
|
| | | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
United States | 32,640 |
| | 99 |
| | 26,091 |
| | 99 |
Foreign | 303 |
| | 1 |
| | 341 |
| | 1 |
| 32,943 |
| | 100 |
| | 26,432 |
| | 100 |
Costs and Expenses: | | | | | | | |
Operating | 21,772 |
| | 66 |
| | 18,306 |
| | 69 |
Administrative and general | 6,402 |
| | 19 |
| | 5,367 |
| | 21 |
Depreciation and amortization | 206 |
| | 1 |
| | 301 |
| | 1 |
| 28,380 |
| | 86 |
| | 23,974 |
| | 91 |
Operating Income | 4,563 |
| | 14 |
| | 2,458 |
| | 9 |
Other Income: | | | | | | | |
Foreign currency gains, net | — |
| | — |
| | 2 |
| | — |
Other, net | (3 | ) | | — |
| | — |
| | — |
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax | (67 | ) | | — |
| | 135 |
| | 1 |
Segment Profit | 4,493 |
| | 14 |
| | 2,595 |
| | 10 |
Operating Revenues. Operating revenues were $6.5$10.4 million lower primarily due to the successful completion of major task orders related to long-term recovery programs in the U.S. Virgin Islands and the conclusion of disaster response work for multiple city and county governments.
Operating Expenses. Operating expenses were $6.1 million lower primarily due to the completion of major recovery program task orders.
Administrative and General. Administrative and general expenses were $1.3 million higher primarily due to an accrual of $1.4 million following a change in the application of the gross receipts tax in the U.S. Virgin Islands primarily relating to work completed in 2019 and 2018.
Operating Income (Loss). Operating loss as a percentage of operating revenues was 5% in the Current Year Quarter compared with the Prior Year Quarter primarily due to activity related to ongoing recovery projects in the U.S. Virgin Islands following the hurricanes of 2017.
Operating Expenses. Operating expenses were $3.5 million higher in the Current Year Quarter compared with the Prior Year Quarter primarily due to ongoing activities in the U.S. Virgin Islands consistent with increased operating revenues.
Administrative and General. Administrative and general expenses were $1.0 million higher in the Current Year Quarter compared with the Prior Year Quarter primarily due to increased personnel costs associated with ongoing recovery projects in the U.S. Virgin Islands following the hurricanes of 2017.
Operating Income. Operating income as a percentage of operating revenues wasof 14% in the Current Year Quarter compared with 9% in the Prior Year Quarter primarily due to activities inreduced operating revenues and the U.S. Virgin Islands following the hurricanes of 2017.gross receipts tax accrual discussed above.
Other
|
| | | | | | | | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | |
United States | 1,801 |
| | 100 |
| | — |
| | — |
|
Foreign | 4 |
| | — |
| | 116 |
| | 100 |
|
| 1,805 |
| | 100 |
| | 116 |
| | 100 |
|
Costs and Expenses: | | | | | | | |
Operating | 1,253 |
| | 69 |
| | — |
| | — |
|
Administrative and general | 839 |
| | 47 |
| | 186 |
| | 160 |
|
Depreciation and amortization | 489 |
| | 27 |
| | — |
| | — |
|
| 2,581 |
| | 143 |
| | 186 |
| | 160 |
|
Operating Loss | (776 | ) | | (43 | ) | | (70 | ) | | (60 | ) |
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax(2) | (90 | ) | | (5 | ) | | 1,167 |
| | n/m |
|
Segment Profit (Loss)(1)(2) | (866 | ) | | (48 | ) | | 1,097 |
| | n/m |
|
_____________________
| |
(1) | Includes amounts attributable to both SEACOR and noncontrolling interests. See “Item 1. Financial Statements—Note 8. Noncontrolling Interests in Subsidiaries” included in Part I of this Quarterly Report on Form 10-Q. |
| |
(2) | The balance as a percentage of operating revenues is not meaningful (“n/m”). |
Operating Activities. Operating activities in the Current Year Quarter primarily consists of the business activities of Cleancor, which the Company acquired on June 1, 2018.
Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax. Equity in losses of 50% or less owned companies, net of tax, were lower due to improved operating results in the Company's Brazilian joint venture.
Other
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Three Months Ended March 31, | | | | | | |
| | | | | | | | | 2020 | | | | 2019 | | |
| | | | | | | | | $’000 | | % | | $’000 | | % |
Operating Revenues: | | | | | | | | | | | | | | | |
United States | | | | | | | | | 2,399 | | | 100 | | | 1,801 | | | 100 | |
Foreign | | | | | | | | | — | | | — | | | 4 | | | — | |
| | | | | | | | | 2,399 | | | 100 | | | 1,805 | | | 100 | |
Costs and Expenses: | | | | | | | | | | | | | | | |
Operating | | | | | | | | | 1,847 | | | 77 | | | 1,253 | | | 69 | |
Administrative and general | | | | | | | | | 1,124 | | | 47 | | | 839 | | | 47 | |
Depreciation and amortization | | | | | | | | | 619 | | | 26 | | | 489 | | | 27 | |
| | | | | | | | | 3,590 | | | 150 | | | 2,581 | | | 143 | |
Gains on Asset Dispositions | | | | | | | | | 60 | | | 3 | | | — | | | — | |
Operating Loss | | | | | | | | | (1,131) | | | (47) | | | (776) | | | (43) | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Equity in Losses of 50% or Less Owned Companies, Net of Tax | | | | | | | | | (52) | | | (2) | | | (90) | | | (5) | |
Segment Loss(1) | | | | | | | | | (1,183) | | | (49) | | | (866) | | | (48) | |
_____________________
(1)Includes amounts attributable to both SEACOR and noncontrolling interests.
Operating Activities. The operating activities of Other primarily consists of the business activities of Cleancor.
Current Year Quarter compared with Prior Year Quarter
Operating Revenues. Operating revenues were $0.6 million higher primarily due to an increase in fuel sales as a consequence of a pipeline interruption project and supplying fuel for an onshore oil and gas exploration project.
Operating Expenses. Operating expenses were $0.6 million higher primarily due to an increase in the cost of sales associated with the increase in fuel sales, and an increase in technical management and equipment rentals associated with the projects discussed above.
Administrative and General. Administrative and general expenses were $0.3 million higher primarily due to higher compensation costs associated with the expansion of the Company's sales force and higher business development expenses.
Depreciation and Amortization. Depreciation and amortization expenses were $0.1 million higher as a result of placing additional equipment into service.
Equity in Losses of 50% or Less Owned Companies, Net of Tax. The Company’s 50% or less owned companies primarily consist of general aviation services businesses in Asia including Hawker Pacific prior to its sale in 2018, and an agricultural commodity trading and logistics business.
Corporate and Eliminations
| | | | | | | | | | | | | | | |
| | | | | Three Months Ended March 31, | | |
| | | | | 2020 | | 2019 |
| | | | | $’000 | | $’000 |
Corporate Expenses | | | | | (6,368) | | | (6,351) | |
Eliminations | | | | | 23 | | | 14 | |
Operating Loss | | | | | (6,345) | | | (6,337) | |
Other Income (Expense): | | | | | | | |
| | | | | | | |
Foreign currency losses, net | | | | | (38) | | | (7) | |
Other, net | | | | | — | | | 10 | |
| | | | | | | |
Corporate and Eliminations |
| | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | $’000 |
Corporate Expenses | (6,351 | ) | | (6,827 | ) |
Eliminations | 14 |
| | 31 |
|
Operating Loss | (6,337 | ) | | (6,796 | ) |
Other Income (Expense): | | | |
Foreign currency gains (losses), net | (7 | ) | | 36 |
|
Other, net | 10 |
| | — |
|
Other Income (Expense) not included in Segment Profit (Loss) | | | | | | | | | | | | | | | |
| | | | | Three Months Ended March 31, | | |
| | | | | 2020 | | 2019 |
| | | | | $’000 | | $’000 |
Interest income | | | | | 1,601 | | | 1,900 | |
Interest expense | | | | | (4,470) | | | (5,113) | |
Debt extinguishment losses | | | | | (319) | | | (793) | |
Marketable security gains (losses), net | | | | | (104) | | | 3,068 | |
| | | | | (3,292) | | | (938) | |
Interest income. Interest income in the Current Year Quarter was lower compared with the Prior Year Quarter primarily due to lower invested cash balances and lower interest rates, partially offset by higher interest income from loans and advances to 50% or less owned companies. Other Income (Expense) not included in Segment Profit (Loss) |
| | | | | |
| Three Months Ended March 31, |
| 2019 | | 2018 |
| $’000 | | $’000 |
Interest income | 1,900 |
| | 1,856 |
|
Interest expense | (5,113 | ) | | (8,563 | ) |
Debt extinguishment losses, net | (793 | ) | | (42 | ) |
Marketable security gains (losses), net | 3,068 |
| | (3,798 | ) |
| (938 | ) | | (10,547 | ) |
Interest expense. Interest expense in the Current Year Quarter was lower compared with the Prior Year Quarter primarily due to the redemption of the 7.375% Senior Notes in October 2018, purchases of the 3.0% Convertible Senior Notes, and a reduction
of the outstanding balances under the SEA-Vista Credit Facility, partially offset by an increase in interest expense from commitment fees and issue cost amortization on the 3.25% Convertible Senior Notes issued in May 2018.SEACOR Revolving Credit Facility entered into on March 19, 2019.
Debt extinguishment losses.Debt extinguishment losses net. Duringin the Current Year Quarter resulted from the Company purchasedpurchase of $15.6 million in principal amount of the Company’s 3.0% Convertible Senior Notes for $15.4 million. Debt extinguishment losses in the Prior Year Quarter resulted from the purchase of $24.0 million in principal amount of itsthe Company’s 3.0% Convertible Senior Notes for $23.2 million resulting in debt extinguishment losses of $0.8 million.
Marketable security gains (losses), net. The Company’s most significant marketable security position is its ownership of 5.2 million shares in Dorian LPG Ltd. (“Dorian”), a publicly traded company listed on the New York Stock Exchange under the symbol “LPG.” Marketable security gains (losses), net in all periods are primarily related to unrealized gains or losses onmarking-to-market a security portfolio primarily consisting of investments in energy, marine, transportation and other related businesses. In the Company’s investmentPrior Year Quarter, the most significant position was in Dorian.Dorian LPG Ltd, which the Company sold during 2019.
Income Taxes
During the three months ended March 31, 2019,2020, the Company’s effective income tax rate of 12.4%179.5% was higher than the statutory rate primarily due to foreign sourceda pre-tax loss, a benefit from a statutory change the U.S. federal income not subject to U.S. tax taxes not provided on income attributable to noncontrolling interestscode and income subject to tonnage tax, partially offset by foreign taxessourced income not creditable againstsubject to U.S. income tax.
Liquidity and Capital Resources
General
The Company’s ongoing liquidity requirements arise primarily from working capital needs, capital commitments and its obligations to repay debt. The Company may use its liquidity to fund acquisitions, repurchase shares of SEACOR common stock, par value $0.01 per share (“Common Stock”),Stock for treasury, repurchase its outstanding notes or make other investments. Sources of liquidity are cash balances, marketable securities, construction reserve funds, cash flows from operations and availability under the SEACOR Revolving Credit Facility.Company's revolving credit facilities. From time to time, the Company may secure additional liquidity through asset sales or the issuance of debt, shares of Common Stock or common stock of its subsidiaries, preferred stock or a combination thereof.
As of March 31, 2019,2020, the Company's capital commitments by year of expected payment were as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Remainder of 2020 | | 2021 | | 2022 | | | | Total |
Ocean Services | $ | 20,864 | | | $ | 30,993 | | | $ | 2,636 | | | | | $ | 54,493 | |
Inland Services | 6,318 | | | — | | | — | | | | | 6,318 | |
Other | 226 | | | — | | | — | | | | | 226 | |
| $ | 27,408 | | | $ | 30,993 | | | $ | 2,636 | | | | | $ | 61,037 | |
|
| | | | | | | | | | | |
| Remainder of 2019 | | 2020 | | Total |
Ocean Services | $ | 1,378 |
| | $ | 8,388 |
| | $ | 9,766 |
|
Inland Services | 17,875 |
| | 1,039 |
| | 18,914 |
|
Other | 176 |
| | — |
| | 176 |
|
| $ | 19,429 |
| | $ | 9,427 |
| | $ | 28,856 |
|
Subsequent to March 31, 2019,2020, the CompanyCompany committed to purchase additional equipment for $1.5$1.1 million.
As of March 31, 2019,2020, the Company had outstanding debt of $323.6$298.8 million, net of discounts and issuance costs, and letters of credit totaling $3.0$1.2 million with various expiration dates through 2027. In addition, as of March 31, 2019,2020, the Company guaranteed payments on behalf of SEACOR Marine totaling $36.6$18.5 million, under certain sale-leaseback transactions, equipment financing and multi-employer pension obligations. These guarantees continue to be contingent obligations of the
Company because the beneficiary of the guarantees did not release the Company from its obligations in connection with the Spin-offspin-off of SEACOR Marine and decline as payments are made by SEACOR Marine on the underlying obligations. The Company earns a fee from SEACOR Marine of 0.5% per annum on the amount of the obligations under these guarantees.
As of March 31, 2019,2020, the holders of the Company’s 3.0% Convertible Senior Notes ($83.334.5 million outstanding), 2.5% Convertible Senior Notes ($64.5 million outstanding) and 3.25% Convertible Senior Notes ($117.8 million outstanding) may require the Company to repurchase the notes on November 19, 2020, December 19, 2022 and May 15, 2025, respectively. The Company’s long-term debt maturities, assuming the holders of the aforementioned convertible senior notes require the Company to repurchase the notes on those dates, are as follows (in thousands):
| | Remainder of 2019 | $ | 6,300 |
| |
2020 | 157,958 |
| |
Remainder of 2020 | | Remainder of 2020 | $ | 42,659 | |
2021 | 500 |
| 2021 | 10,857 | |
2022 | 64,958 |
| 2022 | 74,988 | |
2023 | 368 |
| 2023 | 10,368 | |
Years subsequent to 2023 | 123,780 |
| |
2024 | | 2024 | 60,244 | |
Years subsequent to 2024 | | Years subsequent to 2024 | 123,536 | |
| $ | 353,864 |
| | $ | 322,652 | |
SEACOR’s Board of Directors previously approved a securities repurchase plan that authorizes the Company to acquire its Common Stock, 3.25% Convertible Senior Notes, 3.0% Convertible Senior Notes, 2.5% Convertible Senior Notes and 2.5%3.25% Convertible Senior Notes, (collectively the “Securities”) through open market purchases, privately negotiated transactions or otherwise, depending on market conditions. As of March 31, 2019,2020, the Company’s remaining repurchase authority for the Securities was $43.5$113.1 million.
As of March 31, 2019,2020, the Company held balances of cash, cash equivalents, restricted cash, restricted cash equivalents and marketable securities and construction reserve funds totaling $181.4$85.2 million. As of March 31, 2019, construction reserve funds of $3.9 million were classified as non-current assets in the accompanying condensed consolidated balance sheets as the Company has the intent and ability to use the funds to acquire qualifying equipment. Additionally, the Company had $125.0$225.0 million available under the SEACOR Revolving Credit Facility and $100.0 million available under a subsidiaryits revolving credit facility.facilities.
Summary of Cash Flows | |
| | | | | | | Three Months Ended March 31, | |
| Three Months Ended March 31, | | 2020 | | 2019 |
| 2019 | | 2018 | | $’000 | | $’000 |
| $’000 | | $’000 | |
Cash Flows provided by Operating Activities | 34,660 |
| | 12,907 |
| Cash Flows provided by Operating Activities | 25,002 | | | 34,660 | |
Cash Flows provided by (used in) Investing Activities | (5,364 | ) | | 24,960 |
| |
| Cash Flows used in Investing Activities | | Cash Flows used in Investing Activities | (7,218) | | | (5,364) | |
| Cash Flows used in Financing Activities | (32,370 | ) | | (4,608 | ) | Cash Flows used in Financing Activities | (18,719) | | | (32,370) | |
| Effects of Exchange Rate Changes on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 6 |
| | 17 |
| Effects of Exchange Rate Changes on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (179) | | | 6 | |
Increase (Decrease) in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (3,068 | ) | | 33,276 |
| |
| Net Decrease in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | | Net Decrease in Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (1,114) | | | (3,068) | |
Operating Activities
Cash flows provided by operating activities increaseddecreased by $21.8$9.7 million in the Current Year Quarter compared with the Prior Year Quarter. The components of cash flows provided by (used in) operating activities during the Current Year Quarter and Prior Year Quarter were as follows:
| | | | | | | Three Months Ended March 31, | |
| Three Months Ended March 31, | | 2020 | | 2019 |
| 2019 | | 2018 | | $’000 | | $’000 |
Operating income before depreciation, amortization and gains on asset dispositions, net | | Operating income before depreciation, amortization and gains on asset dispositions, net | 17,247 | | | 35,667 | |
| $’000 | | $’000 | |
Operating income before depreciation, amortization and gains on asset dispositions | 35,667 |
| | 27,252 |
| |
Changes in operating assets and liabilities, excluding operating leases, before interest and income taxes | (1,752 | ) | | (13,522 | ) | Changes in operating assets and liabilities, excluding operating leases, before interest and income taxes | 5,741 | | | (1,752) | |
| Dividends received from 50% or less owned companies | | Dividends received from 50% or less owned companies | 100 | | | — | |
Interest paid, excluding capitalized interest(1) | (1,646 | ) | | (1,416 | ) | Interest paid, excluding capitalized interest(1) | (1,459) | | | (1,646) | |
Income taxes paid, net | (454 | ) | | (194 | ) | Income taxes paid, net | (89) | | | (454) | |
Other | 2,845 |
| | 787 |
| Other | 3,462 | | | 2,845 | |
Total cash flows provided by operating activities | 34,660 |
| | 12,907 |
| Total cash flows provided by operating activities | 25,002 | | | 34,660 | |
|
_____________________
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(1) | During the Current Year Quarter and Prior Year Quarter, capitalized interest paid and included in purchases of property and equipment was not material and $0.2 million, respectively. |
(1)During the Current Year Quarter and Prior Year Quarter, interest paid and capitalized in property and equipment was immaterial.
Operating income before depreciation, amortization and gains on asset dispositions, net was $8.4$18.4 million higherlower in the Current Year Quarter compared with the Prior Year Quarter. See “Consolidated Results of Operations” included above for a discussion of the results of each of the Company’s business segments.
Investing Activities
During the Current Year Quarter, net cash used in investing activities was $7.2 million primarily as follows:
•Capital expenditures were $6.4 million related primarily to the construction of harbor tugs and the purchase of machinery and equipment.
•The Company acquired Helix Media Pte. Ltd., Naviate Response (Asia) Pte. Ltd., Navigate PR Ltd. and Navigate Response Limited (collectively "Navigate") for a purchase price of $1.0 million, net of cash acquired of $0.8 million paid at the closing of the acquisition and $1.8 million of contingent consideration that is payable upon Navigate meeting certain specified cash collection and client retention targets for the 24 months following the acquisition date.
During the Prior Year Quarter, net cash used in investing activities was $5.4 million primarily as follows:
•Capital expenditures were $5.6 million related to the acquisition of real property, upgrades to inland river towboats and the construction of other Inland Services equipment.
•The Company received net payments on third-party leases and notes receivables of $0.2 million.
During the Prior Year Quarter, net cash provided by investing activities was $25.0 million primarily as follows:
Capital expenditures were $9.5 million. Equipment deliveries included one U.S.-flag harbor tug and two foreign-flag short-sea container/RORO vessels.
The Company sold one U.S.-flag petroleum and chemical carrier, one U.S.-flag harbor tug, 32 inland river dry-cargo barges, two inland river specialty barges and other equipment for net proceeds of $15.9 million.
The Company made advances of $0.9 million to its 50% or less owned company VA&E.
The Company received $4.8 million from its 50% or less owned companies, including $4.4 million from VA&E.
Financing Activities
During the Current Year Quarter, net cash used in financing activities was $18.7 million. The Company:
•purchased $15.6 million in principal amount of its 3.0% Convertible Senior Notes for total consideration of $15.4 million;
•made scheduled repayments of $2.5 million under the SEA-Vista 2019 Credit Facility;
•made other scheduled payments on long-term debt of $0.2 million;
•acquired 41,600 shares of Common Stock for treasury for an aggregate purchase price of $1.4 million;
•acquired 17,144 shares of Common Stock for treasury for an aggregate purchase price of $0.5 million from its employees to cover their tax withholding obligations related to the vesting of equity awards. These shares were purchased in accordance with the terms of the Company’s Share Incentive Plans and not pursuant to the repurchase authorizations for its Securities granted by SEACOR’s Board of Directors; and
•received $1.4 million from share award plans.
During the Prior Year Quarter, net cash used in financing activities was $32.4 million. The Company:
•purchased $24.0 million in principal amount of its 3.0% Convertible Senior Notes for $23.2 million;
•incurred issuance costs of $2.2 million related to the SEACOR Revolving Credit Facility;
•repaid $8.0 million under the SEA-Vista 2015 Credit Facility;
•made other scheduled payments on long-term debt of $0.2 million;
•made distributions to noncontrolling interests of $0.2 million;
•acquired 8,121 shares of Common Stock for treasury for an aggregate purchase price of $0.4 million from its employees to cover their tax withholding obligations related to the vesting of equity awards. These shares were purchased in accordance with the terms of the Company’s Share Incentive Plans and not pursuant to the repurchase authorizations for its Securities granted by SEACOR’s Board of Directors; and
•received $1.7 million from share award plans.
During the Prior Year Quarter, net cash used in financing activities was $4.6 million. The Company:
repaid $2.2 million under the SEA-Vista Credit Facility;
repaid $5.7 million under the ISH Credit Facility;
made other scheduled payments on long-term debt of $0.2 million; and
received $3.6 million from share award plans.
Short and Long-Term Liquidity Requirements
The Company anticipates it will continue to generate positive cash flows from operations and that these cash flows will be adequate to meet the Company’s working capital requirements. In supportsupport of the Company’s capital expenditure program and debt service requirements, the Company believes that a combination of cash balances on hand, cash generated from operating activities, funding available under the SEACOR Revolving Credit FacilityCompany's revolving credit facilities and existing subsidiary financing arrangements as well as access to the credit and capital markets will provide sufficient liquidity to meet its obligations. The Company continually evaluates possible acquisitions and dispositions of certain businesses and assets. The Company’s sources of liquidity may be impacted by the general condition of the markets in which it operates and the broader economy as a whole, which may limit its access to the credit and capital markets on acceptable terms. To date, the COVID-19 pandemic has not had a material impact on the Company's liquidity. Management will continue to closely monitor the Company’s liquidity and the credit and capital markets.markets generally and more specifically as it relates to the COVID-19 pandemic.
Off-Balance Sheet Arrangements
For a discussion of the Company's off-balance sheet arrangements, refer to “Liquidity and Capital Resources” contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2018.2019. There has been no material change in the Company’s off-balance sheet arrangements during the Current Year Quarter. In addition,As of March 31, 2020, the Company has issued lettersguaranteed payments on behalf of credit or guaranteed the payments of amounts owedSEACOR Marine totaling $18.5 million, under certain sale-leaseback transactions, equipment financing and multi-employer pension obligations on behalf of SEACOR Marine. As of March 31, 2019,obligations. These guarantees on behalf of SEACOR Marine totaled $36.6 million and will decline as payments are made on the outstandingunderlying obligations.
Contractual Obligations and Commercial Commitments
For a discussion of the Company's contractual obligations and commercial commitments, refer to “Liquidity and Capital Resources” contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2018.2019. There has been no material change in the Company’s contractual obligations and commercial commitments during the Current Year Quarter.
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ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
For a discussion of the Company’s exposure to market risk, refer to Item 7A. “Quantitative and Qualitative Disclosures About Market Risk” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.2019. There has been no material change in the Company’s exposure to market risk during the Current Year Quarter.
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ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
With the participation of the Company’s principal executive officer and principal financial officer, management evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of March 31, 2019.2020. Based on their evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2019.2020.
The Company’s disclosure controls and procedures have been designed to ensure that information required to be disclosed by the Company in the reports it files or furnishes under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, to allow timely decisions regarding required disclosures. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those internal control systems determined to be effective can provide only a level of reasonable assurance with respect to financial statement preparation and presentation.
Changes in Internal Control Over Financial Reporting
Except for the addition of certain controls in connection with the adoption of Financial Accounting Standard Board Topic 842, Leases, thereThere were no other changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15 and 15d-15 under the Exchange Act) that occurred during the three months ended March 31, 20192020 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II—II - OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS
For a description of developments with respect to pending legal proceedings described in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2018,2019, see Note 11.14. “Commitments and Contingencies” included in Part I. Item 1. “Financial Statements” elsewhere in this Quarterly Report on Form 10-Q.
ITEM 1A.RISK FACTORS
For a discussion of the Company’s risk factors, refer to Item 1A. “Risk Factors” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.2019. There have been no material changes in the Company’s risk factors during the Current Year Quarter.
The COVID-19 outbreak has and will likely continue to negatively affect the global economy and could have a material adverse effect on the Company's businesses, results of operations and financial condition. The Company's operations are susceptible to global events that could have an adverse effect on its businesses, results operations and financial condition, such as the novel COVID-19 virus (“coronavirus”) pandemic. As of the date of this report, the coronavirus has spread throughout most of the world and has caused many governments to implement stay-at-home orders, quarantines and significant restrictions on travel. Many of these governments have also implemented work restrictions that prohibit many employees from going to their customary work locations and which require these employees to work remotely if possible or not at all if working remotely is not possible.
Although the coronavirus pandemic has not to date had a material effect on the Company's businesses, it is a dynamic and continuously evolving phenomenon and the ultimate severity of the outbreak is uncertain at this time. If the pandemic worsens or additional restrictions are implemented to contain the outbreak, the Company may experience a material and adverse effect on its business, results of operations and financial condition.
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ITEM 2. | ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
| |
(c) | This table provides information with respect to purchases by the Company of shares of its Common Stock during the Current Year Quarter: |
|
| | | | | | | | | | | | | |
Period | Total Number Of Shares Purchased(1) | | Average Price Paid Per Share | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | Maximum Value of Securities that may Yet be Purchased under the Plans or Programs(1) |
January 1 – 31, 2019 | — |
| | $ | — |
| | — |
| | $ | 66,739,371 |
|
February 1 – 28, 2019 | — |
| | $ | — |
| | — |
| | $ | 66,739,371 |
|
March 1 – 31, 2019 | — |
| | $ | — |
| | — |
| | $ | 43,543,621 |
|
(c) This table provides information with respect to purchases by the Company of shares of its Common Stock during the Current Year Quarter: | | | | | | | | | | | | | | | | | | | | | | | |
Period | Total Number Of Shares Purchased(1) | | Average Price Paid Per Share | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | Maximum Value of Securities that may Yet be Purchased under the Plans or Programs(1) |
Jan 1 – 31, 2020 | — | | | $ | — | | | — | | | $ | 127,689,657 | |
February 1 –29, 2020 | — | | | $ | — | | | — | | | $ | 127,689,657 | |
March 1 – 31, 2020 | 41,600 | | | $ | 33.21 | | | 41,600 | | | $ | 113,107,086 | |
______________________
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(1) | SEACOR’s Board of Directors previously approved a securities repurchase plan that authorizes the Company to acquire its Common Stock, 3.0% Convertible Senior Notes, 3.25% Convertible Senior Notes and 2.5% Convertible Senior Notes (collectively the “Securities”) through open market purchases, privately negotiated transactions or otherwise, depending on market conditions. During the Current Year Quarter, the Company repurchased$24.0 million in principal amount of its 3.0% Convertible Senior Notes for $23.2 million thereby reducing repurchase authority under the plan. |
(1)SEACOR’s Board of Directors previously approved a securities repurchase plan that authorizes the Company to acquire its Common Stock, 3.0% Convertible Senior Notes, 3.25% Convertible Senior Note and 2.5% Convertible Senior Notes (collectively the “Securities”) through open market purchases, privately negotiated transactions or otherwise, depending on market conditions. During the Current Year Quarter, the Company purchased $15.6 million in principal amount of its 3.0% Convertible Senior Notes for $15.4 million thereby reducing repurchase authority under the plan. | |
ITEM 3. | DEFAULT UPON SENIOR SECURITIES |
ITEM 3. DEFAULT UPON SENIOR SECURITIES
None.
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ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
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10.1*31.1* | | | |
10.2* | | |
10.3* | | |
31.1* | | |
31.2* | | | |
32.1* | | | |
32.2* | | | |
101.INS**101 | | XBRL Instance DocumentThe following financial statements from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, formatted in Inline XBRL: (i) Consolidated Statements of Cash Flows, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Balance Sheets, and (v) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags. |
101.SCH**104 | | The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, formatted in Inline XBRL Taxonomy Extension Schema |
101.CAL** | | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF** | | XBRL Taxonomy Extension Definition Linkbase |
101.LAB** | | XBRL Taxonomy Extension Label Linkbase |
101.PRE** | | XBRL Taxonomy Extension Presentation Linkbase(included as Exhibit 101). |
______________________
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| | | | |
* | Filed herewith. |
** | Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability. |
SIGNATURES
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 thereunto duly authorized.
| | | | | | | | | | | | | | |
| | | | SEACOR Holdings Inc. (Registrant) |
| | | | |
DATE: | April 28, 2020 | By: | | SEACOR Holdings Inc. (Registrant) |
| | | | |
DATE: | April 24, 2019 | By: | | /S/ CHARLES FABRIKANT |
| | | | Charles Fabrikant, Executive Chairman of the Board and Chief Executive Officer (Principal Executive Officer) |
| | | | |
DATE: | April 24, 201928, 2020 | By: | | /S/ BRUCE WEINS |
| | | | Bruce Weins, Senior Vice President and Chief Financial Officer (Principal Financial Officer) |