HOUSTON, May 5, 2022
/PRNewswire/ -- Independence Contract Drilling, Inc. (the "Company"
or "ICD") (NYSE: ICD) today reported financial results for the
three months ended March 31,
2022.
First quarter 2022 Highlights
- Net loss, as defined below, of $12.2
million, or $1.08 per
share.
- Adjusted net loss, as defined below, of $11.2 million, or $0.99 per share.
- Adjusted EBITDA, as defined below, of $3.6 million, representing an approximate 146%
sequential improvement from the fourth quarter of 2021.
- Net debt, excluding finance leases and net of deferred
financing costs, of $140.1
million.
- Marketed fleet utilization of 68%.
- Fully burdened margin of $5,754
per day.
In the first quarter of 2022, the Company reported revenues of
$35.0 million, a net loss of
$12.2 million, or $1.08 per share, adjusted net loss (defined
below) of $11.2 million, or
$0.99 per share, and adjusted EBITDA
(defined below) of $3.6
million. These results compare to revenues of
$15.5 million, a net loss of
$16.0 million, or $2.58 per share, adjusted net loss of
$16.4 million, or $2.64 per share, and adjusted EBITDA loss of
$2.0 million in the first quarter of
2021, and revenues of $28.6 million,
a net loss of $31.5 million, or
$3.23 per share, an adjusted net loss
of $13.2 million, or $1.35 per share, and adjusted EBITDA of
$1.5 million in the fourth quarter of
2021.
Chief Executive Officer Anthony
Gallegos commented, "We are pleased that increasing demand,
pricing and margin generating capability for ICD's pad optimal,
super-spec ShaleDriller rigs are reflected in our first quarter
2022 results, in-line with our prior forecasts. More exciting
is that we expect an incremental 30% to 35% sequential improvement
in margin per day during the second quarter of 2022. Based on
our outlook and contract roll-over schedule, we expect continued
meaningful improvements in our rig margin metric as this upcycle
continues to unfold. Leading edge dayrates for pad-optimal 300
series superspec rigs are now $30,000
per day or higher and we believe the very limited supply of this
class of rig will drive further dayrate and margin improvements the
back half of this year and into 2023.
I could not be more excited about ICD's strategic positioning in
this market dynamic. With our focus on short-term, pad-to-pad
contracts, we are poised to quickly convert this rapidly improving
dayrate momentum into our reported results. Right now, we do
not have a single contract extending past mid-October. With
our term loan refinancing now complete, we have resumed our rig
reactivation plans with our 18th rig expected to be
placed into service early in the third quarter and two additional
reactivations planned during the remainder of the year. All
three of these incremental rigs will be 300 series rigs. Rigs
meeting our 300 series specifications are in the shortest supply
and enjoy the highest demand in the industry. These rigs earn the
highest dayrate and margins, and we expect each of these rig
reactivation investments to pay back in less than one year and
yield meaningful investment returns. We believe all of this
sets up ICD very nicely to reach our goal of entering 2023
generating rig margins of $10,000 per
day or more.
We also continue to enhance our customer mix and recently
contracted a rig with one of the very largest independent oil and
gas operators in the Permian basin. On the ESG front, I am
extremely proud that ICD was selected by an existing customer, one
of the largest international E&P companies in the world, to
drill their pilot carbon capture well program in the lower
48. I believe the selection of ICD for this high-profile
operation is further validation of the quality of our equipment,
drilling teams and operations, and reflects the confidence that our
customers have in us to provide the safest and most efficient
contract drilling services in our industry."
Quarterly Operational Results
In the first quarter of 2022, operating days increased
sequentially by 6% compared to the fourth quarter of 2021.
The Company's marketed fleet operated at 68% utilization and
recorded 1,463 revenue days, compared to 929 revenue days in the
first quarter of 2021, and 1,378 revenue days in the fourth quarter
of 2021.
Operating revenues in the first quarter of 2022 totaled
$35.0 million, compared to
$15.5 million in the first quarter of
2021 and $28.6 million in the fourth
quarter of 2021. Revenue per day in the first quarter of 2022
was $21,823, compared to $15,465 in the first quarter of 2021 and
$19,042 in the fourth quarter of
2021. The sequential increase quarter over quarter in revenue
per day was driven by higher dayrates on contract renewals and
reactivated rigs.
Operating costs in the first quarter of 2022 totaled
$27.2 million, compared to
$14.5 million in the first quarter of
2021 and $24.0 million in fourth
quarter of 2021. There were no operating costs during the
first quarter of 2022 or fourth quarter of 2021 associated with the
reactivation of rigs compared to $1.1
million during the first quarter of 2021. Fully
burdened operating costs were $16,069
per day in the first quarter of 2022, compared to $12,663 in the first quarter of 2021 and
$15,504 in the fourth quarter of
2021. Sequential increases in operating costs per day were
driven primarily by higher labor costs associated with increases in
field-level wages.
Excluding the impact from reactivation costs, fully burdened rig
operating margins in the first quarter of 2022 were $5,754 per day, compared to $2,802 per day in the first quarter of 2021 and
$3,538 per day in the fourth quarter
of 2021. The Company currently expects per day operating
margins in the second quarter of 2022 to increase sequentially
between 30% and 35% compared to the first quarter 2022, driven
primarily by favorable dayrate momentum.
Selling, general and administrative expenses in the first
quarter of 2022 were $5.2 million
(including $1.0 million of non-cash
compensation), compared to $3.7
million (including $0.7
million of non-cash compensation) in the first quarter of
2021 and $3.9 million (including
$0.8 million of non-cash
compensation) in the fourth quarter of 2021. The sequential
increase in cash selling, general and administrative expenses was
primarily due to reinstitution of pre-COVID pay levels.
Drilling Operations Update
The Company exited the first quarter with 17 rigs operating,
with our 18th rig scheduled to be reactivated early in the third
quarter of 2022. Overall, the Company's operating rig count
averaged 16.3 rigs during the quarter. The Company's backlog
of drilling contracts with original terms of six months or longer
was $13.1 million as of March 31, 2022. This backlog excludes rigs
operating on short term pad-to-pad drilling contracts. All of
this backlog is expected to be realized during 2022.
Capital Expenditures and Liquidity Update
Cash outlays for capital expenditures in the first quarter of
2022, net of asset sales and recoveries, were $5.7 million. This included $4.5 million associated with prior period
deliveries.
As of March 31, 2022, the Company had cash on hand of
$9.3 million, a revolving line of
credit with availability of $12.0
million, and $157.5 million
principal amount outstanding under its new convertible notes.
During the first quarter of 2022, the Company issued an
aggregate of 1.1 million shares of its common stock through
at-the-market ("ATM") offerings raising $3.6
million of gross proceeds.
Conference Call Details
A conference call for investors will be held today, May 5, 2022, at 11:00 a.m.
Central Time (12:00 p.m. Eastern
Time) to discuss the Company's first quarter 2022
results.
The call can be accessed live over the telephone by dialing
(855) 239-3115 or for international callers, (412) 542-4125.
A replay will be available shortly after the call and can be
accessed by dialing (877) 344-7529 or for international callers,
(412) 317-0088. The passcode for the replay is 9952288.
The replay will be available until May 12,
2022.
Interested parties may also listen to a simultaneous webcast of
the conference call by logging onto the Company's website at
www.icdrilling.com in the Investor Relations section. A
replay of the webcast will also be available for approximately 30
days following the call.
Certain Defined Terms
Pad-Optimal, Super-Spec Rig is defined as an AC powered rig with
minimum 20,000ft racking capacity, 1500HP+ drawworks, 750,000lb
hookload, three high pressure pumps, four engines and
omni-directional walking system. Such rigs also include dual
fuel, hi-line power and drilling optimization software options.
300 Series Rigs are defined as a Pad-Optimal, Super-Spec rig
with the following additional characteristics: 25,000ft+ racking
capacity, hi-torque top drives, and 1,000,000lb hookload
option.
About Independence Contract Drilling, Inc.
Independence Contract Drilling provides land-based contract
drilling services for oil and natural gas producers in the United States. The Company constructs,
owns and operates a fleet of pad-optimal ShaleDriller rigs that are
specifically engineered and designed to accelerate its clients'
production profiles and cash flows from their most technically
demanding and economically impactful oil and gas properties. For
more information, visit www.icdrilling.com.
Forward-Looking Statements
This news release contains certain forward-looking statements
within the meaning of the federal securities laws. Words such as
"anticipated," "estimated," "expected," "planned," "scheduled,"
"targeted," "believes," "intends," "objectives," "projects,"
"strategies" and similar expressions are used to identify such
forward-looking statements. However, the absence of these words
does not mean that a statement is not forward-looking.
Forward-looking statements relating to Independence Contract
Drilling's operations are based on a number of expectations or
assumptions which have been used to develop such information and
statements but which may prove to be incorrect. These statements
are not guarantees of future performance and involve certain risks,
uncertainties and assumptions that are difficult to predict, and
there can be no assurance that actual outcomes and results will not
differ materially from those expected by management of Independence
Contract Drilling. For more information concerning factors that
could cause actual results to differ materially from those conveyed
in the forward-looking statements, please refer to the "Risk
Factors" section of the Company's Annual Report on Form 10-K, filed
with the SEC and the information included in subsequent amendments
and other filings. These forward-looking statements are based on
and include the Company's expectations as of the date hereof.
Independence Contract Drilling does not undertake any obligation to
update or revise such forward-looking statements to reflect events
or circumstances that occur, or which Independence Contract
Drilling becomes aware of, after the date hereof.
INDEPENDENCE
CONTRACT DRILLING, INC.
Unaudited
(in thousands,
except par value and share data)
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
|
|
|
|
|
March 31, 2022
|
|
December 31, 2021
|
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
9,342
|
|
$
|
4,140
|
Accounts receivable,
net of allowance of $0.1 million and zero, respectively
|
|
|
24,231
|
|
|
22,211
|
Inventories
|
|
|
1,301
|
|
|
1,171
|
Prepaid expenses and
other current assets
|
|
|
4,549
|
|
|
4,787
|
Total current assets
|
|
|
39,423
|
|
|
32,309
|
Property, plant and
equipment, net
|
|
|
358,760
|
|
|
362,346
|
Other long-term assets,
net
|
|
|
2,201
|
|
|
2,449
|
Total assets
|
|
$
|
400,384
|
|
$
|
397,104
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Current portion of long-term debt (1)
|
|
$
|
3,902
|
|
$
|
4,464
|
Accounts payable
|
|
|
18,829
|
|
|
15,304
|
Accrued liabilities
|
|
|
10,681
|
|
|
15,617
|
Current portion of merger consideration payable to an
affiliate
|
|
|
—
|
|
|
2,902
|
Total current
liabilities
|
|
|
33,412
|
|
|
38,287
|
Long-term debt (2)
|
|
|
150,663
|
|
|
141,740
|
Deferred income taxes, net
|
|
|
18,613
|
|
|
19,037
|
Other long-term liabilities
|
|
|
1,894
|
|
|
2,811
|
Total liabilities
|
|
|
204,582
|
|
|
201,875
|
Commitments and
contingencies
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
|
|
|
|
Common stock, $0.01 par value, 50,000,000 shares authorized;
13,698,851 and 10,287,931
shares issued, respectively, and 13,617,005 and
10,206,085 shares outstanding, respectively
|
|
|
136
|
|
|
102
|
Additional paid-in capital
|
|
|
545,575
|
|
|
532,826
|
Accumulated deficit
|
|
|
(345,986)
|
|
|
(333,776)
|
Treasury stock, at cost, 81,846 shares and 81,846 shares,
respectively
|
|
|
(3,923)
|
|
|
(3,923)
|
Total stockholders'
equity
|
|
|
195,802
|
|
|
195,229
|
Total liabilities and
stockholders' equity
|
|
$
|
400,384
|
|
$
|
397,104
|
|
|
(1)
|
As of March 31, 2022
and December 31, 2021, current portion of long-term debt includes
$3.9 million and $4.5 million, respectively, of finance lease
obligations.
|
|
|
(2)
|
As of March 31, 2022
and December 31, 2021, long-term debt includes $1.3 million and
$1.3 million, respectively, of long-term finance lease
obligations.
|
INDEPENDENCE
CONTRACT DRILLING, INC.
Unaudited
(in thousands,
except par value and share data)
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
December 31,
|
|
|
2022
|
|
2021
|
|
2021
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
34,991
|
|
$
|
15,542
|
|
$
|
28,561
|
Costs and expenses
|
|
|
|
|
|
|
|
|
|
Operating costs
|
|
|
27,165
|
|
|
14,541
|
|
|
24,047
|
Selling, general and
administrative
|
|
|
5,228
|
|
|
3,686
|
|
|
3,870
|
Depreciation and
amortization
|
|
|
9,751
|
|
|
9,989
|
|
|
9,671
|
Asset impairment
|
|
|
—
|
|
|
43
|
|
|
25
|
Gain on disposition of assets,
net
|
|
|
(516)
|
|
|
(435)
|
|
|
(63)
|
Other expense
|
|
|
—
|
|
|
—
|
|
|
150
|
Total costs and
expenses
|
|
|
41,628
|
|
|
27,824
|
|
|
37,700
|
Operating
loss
|
|
|
(6,637)
|
|
|
(12,282)
|
|
|
(9,139)
|
Interest expense
|
|
|
(4,461)
|
|
|
(3,709)
|
|
|
(3,899)
|
Loss on extinguishment of debt
|
|
|
(1,533)
|
|
|
—
|
|
|
—
|
Loss before income
taxes
|
|
|
(12,631)
|
|
|
(15,991)
|
|
|
(13,038)
|
Income tax (benefit) expense
|
|
|
(421)
|
|
|
34
|
|
|
18,446
|
Net loss
|
|
$
|
(12,210)
|
|
$
|
(16,025)
|
|
$
|
(31,484)
|
|
|
|
|
|
|
|
|
|
|
Loss per
share:
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
$
|
(1.08)
|
|
$
|
(2.58)
|
|
$
|
(3.23)
|
Weighted average number
of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
|
11,303
|
|
|
6,215
|
|
|
9,743
|
INDEPENDENCE
CONTRACT DRILLING, INC.
Unaudited
(in thousands,
except par value and share data)
|
|
|
|
|
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2022
|
|
2021
|
Cash flows from operating
activities
|
|
|
|
|
|
|
Net loss
|
|
$
|
(12,210)
|
|
$
|
(16,025)
|
Adjustments to
reconcile net loss to net cash used in operating
activities
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
9,751
|
|
|
9,989
|
Asset impairment
|
|
|
—
|
|
|
43
|
Stock-based compensation
|
|
|
731
|
|
|
537
|
Gain on disposition of assets, net
|
|
|
(516)
|
|
|
(435)
|
Non-cash interest expense
|
|
|
3,193
|
|
|
—
|
Loss on extinguishment of debt
|
|
|
1,533
|
|
|
—
|
Amortization of deferred financing costs
|
|
|
250
|
|
|
279
|
Deferred income taxes
|
|
|
(421)
|
|
|
34
|
Bad
debt expense
|
|
|
60
|
|
|
—
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(2,079)
|
|
|
(317)
|
Inventories
|
|
|
(130)
|
|
|
(33)
|
Prepaid expenses and other
assets
|
|
|
386
|
|
|
323
|
Accounts payable and accrued
liabilities
|
|
|
(2,209)
|
|
|
(685)
|
Net cash used in
operating activities
|
|
|
(1,661)
|
|
|
(6,290)
|
Cash flows from investing
activities
|
|
|
|
|
|
|
Purchases of property, plant and equipment
|
|
|
(6,279)
|
|
|
(1,742)
|
Proceeds from the sale of assets
|
|
|
589
|
|
|
654
|
Net cash used in
investing activities
|
|
|
(5,690)
|
|
|
(1,088)
|
Cash flows from financing
activities
|
|
|
|
|
|
|
Proceeds from issuance of convertible debt
|
|
|
157,500
|
|
|
—
|
Repayments under Term Loan Facility
|
|
|
(139,076)
|
|
|
—
|
Borrowings under Revolving ABL Credit Facility
|
|
|
1,500
|
|
|
—
|
Repayments under Revolving ABL Credit Facility
|
|
|
(2)
|
|
|
(8)
|
Payment of merger consideration
|
|
|
(2,902)
|
|
|
—
|
Proceeds from issuance of common stock through at-the-market
facility, net of issuance costs
|
|
|
3,360
|
|
|
521
|
Proceeds from issuance of common stock under purchase
agreement
|
|
|
—
|
|
|
874
|
RSUs withheld for taxes
|
|
|
(32)
|
|
|
(11)
|
Convertible debt issuance costs
|
|
|
(6,601)
|
|
|
—
|
Payments for finance lease obligations
|
|
|
(1,194)
|
|
|
(837)
|
Net cash provided by
financing activities
|
|
|
12,553
|
|
|
539
|
Net increase (decrease)
in cash and cash equivalents
|
|
|
5,202
|
|
|
(6,839)
|
Cash and cash
equivalents
|
|
|
|
|
|
|
Beginning of period
|
|
|
4,140
|
|
|
12,279
|
End
of period
|
|
$
|
9,342
|
|
$
|
5,440
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
Supplemental disclosure of cash flow
information
|
|
|
|
|
|
|
Cash paid during the
period for interest
|
|
$
|
4,262
|
|
$
|
3,171
|
Supplemental disclosure of non-cash investing and
financing activities
|
|
|
|
|
|
|
Change in property,
plant and equipment purchases in accounts payable
|
|
$
|
(701)
|
|
$
|
70
|
Additions to property,
plant and equipment through finance leases
|
|
$
|
604
|
|
$
|
376
|
Extinguishment of
finance lease obligations from sale of assets classified as finance
leases
|
|
$
|
(7)
|
|
$
|
—
|
Transfer of assets from
held and used to held for sale
|
|
$
|
—
|
|
$
|
(550)
|
Shares issued for
structuring fee
|
|
$
|
9,163
|
|
$
|
—
|
The following table provides various financial and operational
data for the Company's operations for the three months ended
March 31, 2022 and 2021 and
December 31, 2021. This information contains
non-GAAP financial measures of the Company's operating
performance. The Company believes this non-GAAP information
is useful because it provides a means to evaluate the operating
performance of the Company on an ongoing basis using criteria that
are used by the Company's management. Additionally, it
highlights operating trends and aids analytical comparisons.
However, this information has limitations and should not be used as
an alternative to operating income (loss) or cash flow performance
measures determined in accordance with GAAP, as this information
excludes certain costs that may affect the Company's operating
performance in future periods.
OTHER FINANCIAL
& OPERATING DATA
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
December 31,
|
|
|
2022
|
|
2021
|
|
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of marketed rigs
end of period (1)
|
|
|
24
|
|
|
|
24
|
|
|
|
24
|
|
Rig operating days
(2)
|
|
|
1,463
|
|
|
|
929
|
|
|
|
1,378
|
|
Average number of
operating rigs (3)
|
|
|
16.3
|
|
|
|
10.3
|
|
|
|
15.0
|
|
Rig utilization
(4)
|
|
|
68
|
%
|
|
|
43
|
%
|
|
|
62
|
%
|
Average revenue per
operating day (5)
|
|
$
|
21,823
|
|
|
$
|
15,465
|
|
|
$
|
19,042
|
|
Average cost per
operating day (6)
|
|
$
|
16,069
|
|
|
$
|
12,663
|
|
|
$
|
15,504
|
|
Average rig margin per
operating day
|
|
$
|
5,754
|
|
|
$
|
2,802
|
|
|
$
|
3,538
|
|
|
|
(1)
|
Marketed rigs exclude
idle rigs that will not be reactivated unless market conditions
materially improve.
|
|
|
(2)
|
Rig operating days
represent the number of days the Company's rigs are earning revenue
under a contract during the period, including days that standby
revenue is earned.
|
|
|
(3)
|
Average number of
operating rigs is calculated by dividing the total number of rig
operating days in the period by the total number of calendar days
in the period.
|
|
|
(4)
|
Rig utilization is
calculated as rig operating days divided by the total number of
days the Company's marketed drilling rigs are available during the
applicable period.
|
|
|
(5)
|
Average revenue per
operating day represents total contract drilling revenues earned
during the period divided by rig operating days in the
period. Excluded in calculating average revenue per operating
day are revenues associated with the reimbursement of (i)
out-of-pocket costs paid by customers of $3.1 million, $1.2 million
and $2.3 million during the three months ended
March 31, 2022 and 2021, and December 31, 2021,
respectively.
|
|
|
(6)
|
Average cost per
operating day represents operating costs incurred during the period
divided by rig operating days in the period. The following
costs are excluded in calculating average cost per operating day:
(i) out-of-pocket costs paid by customers of $3.1 million, $1.2
million and $2.3 million during the three months ended March 31,
2022 and 2021, and December 31, 2021, respectively; (ii) overhead
costs expensed due to reduced rig upgrade activity of $0.6 million,
$0.5 million and $0.4 million during the three months ended March
31, 2022 and 2021, and December 31, 2021, respectively; and (iii)
rig reactivation costs, inclusive of new crew training costs, of
zero, $1.1 million and zero during the three months ended March 31,
2022 and 2021, and December 31, 2021, respectively.
|
Non-GAAP Financial Measures
Adjusted net (loss) income, EBITDA and adjusted EBITDA are
supplemental non-GAAP financial measures that are used by
management and external users of the Company's financial
statements, such as industry analysts, investors, lenders and
rating agencies. In addition, adjusted EBITDA is consistent
with how EBITDA is calculated under the Company's credit facility
for purposes of determining the Company's compliance with various
financial covenants. The Company defines "adjusted net (loss)
income" as net (loss) income before: asset impairment, net; gain or
loss on disposition of assets, net; intangible revenue; severance
and merger-related expenses; gain or loss on extinguishment of debt
and other adjustments. The Company defines "EBITDA" as
earnings (or loss) before interest, taxes, depreciation, and
amortization, and the Company defines "adjusted EBITDA" as EBITDA
before stock-based compensation, non-cash asset impairments, gain
or loss on disposition of assets, gain or loss on extinguishment of
debt and other non-recurring items added back to, or subtracted
from, net income for purposes of calculating EBITDA under the
Company's credit facilities. Neither adjusted net (loss)
income, EBITDA or adjusted EBITDA is a measure of net income as
determined by U.S. generally accepted accounting principles
("GAAP").
Management believes adjusted net (loss) income, EBITDA and
adjusted EBITDA are useful because they allow the Company's
stockholders to more effectively evaluate the Company's operating
performance and compliance with various financial covenants under
the Company's credit facility and compare the results of the
Company's operations from period to period and against the
Company's peers without regard to the Company's financing methods
or capital structure or non-recurring, non-cash transactions. The
Company excludes the items listed above from net income (loss) in
calculating adjusted net (loss) income, EBITDA and adjusted EBITDA
because these amounts can vary substantially from company to
company within the Company's industry depending upon accounting
methods and book values of assets, capital structures and the
method by which the assets were acquired. None of adjusted net
(loss) income, EBITDA or adjusted EBITDA should be considered an
alternative to, or more meaningful than, net income (loss), the
most closely comparable financial measure calculated in accordance
with GAAP, or as an indicator of the Company's operating
performance or liquidity. Certain items excluded from adjusted net
(loss) income, EBITDA and adjusted EBITDA are significant
components in understanding and assessing a company's financial
performance, such as a company's return on assets, cost of capital
and tax structure. The Company's presentation of adjusted net
(loss) income, EBITDA and adjusted EBITDA should not be construed
as an inference that the Company's results will be unaffected by
unusual or non-recurring items. The Company's computations of
adjusted net (loss) income, EBITDA and adjusted EBITDA may not be
comparable to other similarly titled measures of other
companies.
Reconciliation of
Net Loss to Adjusted Net Loss:
|
|
|
(Unaudited)
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
December 31,
|
|
|
2022
|
|
2021
|
|
2021
|
|
|
Amount
|
|
Per Share
|
|
Amount
|
|
Per Share
|
|
Amount
|
|
Per Share
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(12,210)
|
|
$
|
(1.08)
|
|
$
|
(16,025)
|
|
$
|
(2.58)
|
|
$
|
(31,484)
|
|
$
|
(3.23)
|
Add back:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset impairment (1)
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|
0.01
|
|
|
25
|
|
|
—
|
Gain on disposition of assets, net (2)
|
|
|
(516)
|
|
|
(0.05)
|
|
|
(435)
|
|
|
(0.07)
|
|
|
(63)
|
|
|
(0.01)
|
Purchase agreement costs (3)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150
|
|
|
0.02
|
Non-cash income tax expense related to IRC Section 382
limitation (4)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,192
|
|
|
1.87
|
Loss on extinguishment of debt (5)
|
|
|
1,533
|
|
|
0.14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
Adjusted net loss
|
|
$
|
(11,193)
|
|
$
|
(0.99)
|
|
$
|
(16,417)
|
|
$
|
(2.64)
|
|
$
|
(13,180)
|
|
$
|
(1.35)
|
Reconciliation of
Net Loss to EBITDA and Adjusted EBITDA:
|
|
|
(Unaudited)
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
December 31,
|
|
|
2022
|
|
2021
|
|
2021
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(12,210)
|
|
$
|
(16,025)
|
|
$
|
(31,484)
|
Add back:
|
|
|
|
|
|
|
|
|
|
Income tax (benefit) expense
|
|
|
(421)
|
|
|
34
|
|
|
18,446
|
Interest expense
|
|
|
4,461
|
|
|
3,709
|
|
|
3,899
|
Depreciation and amortization
|
|
|
9,751
|
|
|
9,989
|
|
|
9,671
|
Asset impairment (1)
|
|
|
—
|
|
|
43
|
|
|
25
|
EBITDA
|
|
|
1,581
|
|
|
(2,250)
|
|
|
557
|
Gain on disposition of assets, net (2)
|
|
|
(516)
|
|
|
(435)
|
|
|
(63)
|
Stock-based and deferred compensation cost
|
|
|
977
|
|
|
673
|
|
|
808
|
Purchase agreement costs (3)
|
|
|
—
|
|
|
—
|
|
|
150
|
Loss on extinguishment of debt (5)
|
|
|
1,533
|
|
|
—
|
|
|
—
|
Adjusted EBITDA
|
|
$
|
3,575
|
|
$
|
(2,012)
|
|
$
|
1,452
|
|
|
(1)
|
In the first quarter of
2021, the Company recorded an asset impairment of $43 thousand
related to the pending sale of one of our field location
facilities.
|
|
|
(2)
|
In the first quarter of
2022 and 2021, and the fourth quarter of 2021, the Company recorded
gains on the disposition of miscellaneous drilling equipment in the
respective quarter.
|
|
|
(3)
|
Purchase agreement
costs were recorded in the fourth quarter of 2021 in connection
with the Company's committed equity line of credit.
|
|
|
(4)
|
During the fourth
quarter of 2021, the Company recorded non-cash income tax expense
related to the inability to utilize net operating loss ("NOL")
deferred tax assets to offset deferred tax losses due to an IRC
Section 382 change in ownership occurring in October 2021 and the
limitations therefrom placed upon the NOLs.
|
|
|
(5)
|
Loss on extinguishment
of debt related to the unamortized deferred financing costs of the
Term Loan in the first quarter of 2022.
|
INVESTOR CONTACTS:
Independence Contract Drilling, Inc.
E-mail inquiries to: Investor.relations@icdrilling.com
Phone inquiries: (281) 598-1211
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SOURCE Independence Contract Drilling, Inc.