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Tidewater Inc. has a market cap of $2.46 billion; its shares were traded at around $47.65 with a P/E ratio of 11.4 and P/S ratio of 2. The dividend yield of Tidewater Inc. stocks is 2.2%. Tidewater Inc. had an annual average earning growth of 15% over the past 10 years. GuruFocus rated Tidewater Inc. the business predictability rank of 1-star.TDW is in the portfolios of Arnold Van Den Berg of Century Management, Third Avenue Management, John Buckingham of Al Frank Asset Management, Inc., Chuck Royce of Royce& Associates, David Dreman of Dreman Value Management, Bruce Kovner of Caxton Associates, Glenn Greenberg of Brave Warrior Capital, Inc., George Soros of Soros Fund Management LLC, Kenneth Fisher of Fisher Asset Management, LLC, Jeremy Grantham of GMO LLC, Steven Cohen of SAC Capital Advisors, First Pacific Advisors of First Pacific Advisors, LLC, Manning & Napier Advisors, Inc.
Highlight of Business Operations: Oil prices gradually recovered and stabilized in the range of $75 to $85 per barrel during the first nine months of calendar year 2010 due to signs of improvement in the global economy and, in part, because OPEC reduced its crude oil production targets by more than 6.0% over the last 21 months in an effort to stabilize crude oil prices. During the most recent OPEC meeting, which was held in mid-October 2010, OPEC officials decided to keep its existing production targets. The company expects that utilization and day rates for its internationally-based vessels will continue to be closely correlated with oil prices, drilling and exploration activity and the resulting demand for the company’s vessels in the various international markets.
Natural gas prices, which in mid-October 2010 were trading in the $3.45 - $3.96 Mcf range, trended higher during calendar year 2010 as compared to calendar year 2009 due to stronger demand for the resource from the industrial sector and higher consumer demand resulting from a colder-than-normal winter in the early part of the year and a hotter-than-normal spring and summer in North America. Although the above positive trend bodes well for activity in the mid and shallow water depths of the U.S. GOM market in the near-term, the rise in production of unconventional gas resources in North America and the commissioning of a number of new large Liquefied Natural Gas (LNG) exporting facilities around the world are contributing to an over-supplied
The company’s consolidated net earnings for the first half of fiscal 2011 decreased 59%, or $83.4 million, as compared to the same period in fiscal 2010, due primarily to an approximate 15% decrease in total revenues and a $24.4 million, or 472%, increase in income taxes as disclosed in Note (3) of Notes to Unaudited Condensed Consolidated Financial Statements. The company recorded $529.6 million in revenues during the first half of fiscal 2011, which is a decrease of approximately $92.5 million over the revenue earned during the same period of fiscal 2010. Also, the first half of fiscal 2010 included a $49.1 million provision for Venezuelan operations and the reversal of $34.3 million income tax liabilities as previously disclosed in previous SEC filings.
Vessel revenues generated by the company’s international segment decreased approximately 14%, or $79.2 million, during the first half of fiscal 2011 as compared to the same period in fiscal 2010, while vessel revenues generated by the U.S. segment increased approximately $3.0 million, or 6%, during the same comparative periods. Other marine revenues decreased approximately $16.4 million, or 96%, during the same comparative periods. International segment vessel operating costs increased approximately 6%, or $17.1 million, while the company’s U.S. segment vessel operating costs decreased approximately 13%, or $3.8 million, in the first half of fiscal 2011 as compared to the same period in fiscal 2010. Costs of other marine revenues decreased approximately $14.9 million, or 96%, during the same comparative periods. A significant portion of the company’s operations are conducted internationally; therefore, the company’s international vessel operations are the primary driver of its revenue and earnings. Revenues generated from international vessel operations as a percentage of the company’s total vessel revenues were 91% during the first half of fiscal 2011 and 92% during the same period in fiscal 2010.
At September 30, 2010, the company had 380 owned or chartered vessels (excluding joint-venture vessels and vessels withdrawn from service) in its fleet with an average age of 16.4 years. The average age of 190 newer vessels that have been acquired or constructed since calendar year 2000 as part of the company’s new build and acquisition program is 4.7 years. The remaining 190 vessels have an average age of 28.1 years. During the first half of fiscal 2011 and 2010, the company’s newer vessels generated $414.3 million and $376.9 million, respectively, of revenue and accounted for 88.6%, or $181.1 million, and 66.1%, or $194.3 million, respectively, of total vessel margin (vessel revenues less vessel operating cost). Vessel operating costs exclude depreciation on the company’s new vessels of $47.0 million and $35.9 million, respectively, during the same comparative periods.
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