W&T Offshore, Inc (WTI) swung to a net profit for the quarter ended Dec. 31, 2016. The company has made a net profit of $16.48 million, or $ 0.12 a share in the quarter, against a net loss of $51.61 million, or $0.68 a share in the last year period. On an adjusted basis, net profit for the quarter stood at $7.72 million, or $0.06 a share compared with a net loss of $30.52 million, or $0.40 a share in the last year period.
Revenue during the quarter grew 10.71 percent to $115.21 million from $104.06 million in the previous year period. Gross margin for the quarter expanded 1639 basis points over the previous year period to 64.78 percent. Operating margin for the quarter period stood at positive 18.50 percent as compared to a negative 58.44 percent for the previous year period.
Operating income for the quarter was $21.32 million, compared with an operating loss of $60.82 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $69.62 million compared with $41.10 million in the prior year period. At the same time, adjusted EBITDA margin improved 2093 basis points in the quarter to 60.42 percent from 39.49 percent in the last year period.
Tracy W. Krohn, W&T Offshore's chairman and chief executive officer, stated, "With higher commodity prices and significantly lower expenses, we achieved much improved operating margins and positive earnings in the fourth quarter. We are pleased to have met the challenges of 2016 and have exited the year on solid footing and with lower debt. Even with a greatly reduced capital expenditure plan, we limited the decline in production and kept proved reserves relatively flat on a SEC basis but had 102% reserve replacement rate on a year-end NYMEX basis. Although the value of our proved reserves declined based on backward looking SEC pricing, the value would have grown substantially based on NYMEX forward pricing as of the end of 2016.
Operating cash flow drops significantly
W&T Offshore, Inc has generated cash of $14.18 million from operating activities during the year, down 89.36 percent or $119.05 million, when compared with the last year.
The company has spent $82.40 million cash to meet investing activities during the year as against cash inflow of $86.08 million in the last year.
Cash flow from financing activities was $53.04 million for the year as against cash outgo of $157.56 million in the last year period.
Cash and cash equivalents stood at $70.24 million as on Dec. 31, 2016, down 17.77 percent or $15.18 million from $85.41 million on Dec. 31, 2015.
Working capital remains negative
Working capital of W&T Offshore, Inc was negative $11.29 million on Dec. 31, 2016 compared with negative $58.18 million on Dec. 31, 2015. Current ratio was at 0.94 as on Dec. 31, 2016, up from 0.74 on Dec. 31, 2015.
Debt comes down
W&T Offshore, Inc has recorded a decline in total debt over the last one year. It stood at $1,020.73 million as on Dec. 31, 2016, down 14.72 percent or $176.13 million from $1,196.86 million on Dec. 31, 2015. Short-term debt stood at $8.27 million as on Dec. 31, 2016. Total debt was 123.02 percent of total assets as on Dec. 31, 2016, compared with 99.08 percent on Dec. 31, 2015.
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