MITCHAM INDUSTRIES INC (MIND) SEC Filing 10-Q Quarterly report for the period ending Wednesday, October 31, 2018
Rob Capps, Co-CEO
Mitcham Industries, Inc.
Jack Lascar / Mark Roberson
Dennard Lascar Associates Investor Relations
The following information was filed by MITCHAM INDUSTRIES INC on Thursday, December 6, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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- 18489021_128Financial - EarningsThe margin improvement in the comparable fiscal 2019 periods is due to a combination of higher revenue and favorable product mix.
- 18489021_188Revenue - ProductNet cash provided by financing activities in the first nine months of fiscal 2019 consisted of approximately $6.1 from sales of preferred stock, offset by $1.2 million of preferred stock dividend payments, as compared to approximately $3.5 million of net payments under the Credit Agreement, $2.8 million of payments pursuant to the Seamap Credit Facility and $630,000 of preferred stock dividend payments, offset by $1.8 million of proceeds from sales of preferred stock during the first nine months of fiscal 2018.
- 18489021_22Financial - Cash FlowEBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or as alternatives to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP.
- 18489021_26Other - OtherOther companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies.
- 18489021_77Revenue - ProductKlein?s revenue increased 79% in the first nine months of fiscal 2019 as compared to the same period of fiscal 2018, and we remain optimistic that revenue from our sonar products will return to historical and anticipated levels based on our current inventory of project pursuits, pending orders and independent projections of increased world-wide demand for sonar products.
- 18489021_45Other - OtherThis decline has been caused, we believe, by a number of factors including the following: A reduction in demand for seismic services brought about by reduced oil and gas exploration activities, which was in turn caused by lower prices for oil and gas and by excess inventories of those commodities.
- 18489021_164Financial - Cash FlowOur principal sources of liquidity and capital in recent periods have been cash flows provided by operating activities, proceeds from the sale of lease pool equipment and net proceeds from the issuance of preferred stock.
- 18489021_20Other - OtherWe believe that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us.
- 18489021_14Other - OtherManagement monitors EBITDA and Adjusted EBITDA, both as defined in the following table, as key indicators of our overall performance and liquidity.
- 18489021_197Financial - DividendBased on the Preferred Stock outstanding at October 31, 2018, annual dividend requirements are approximately $1.8 million.
- 18489021_167Other - OtherWe believe that our liquidity needs for the next 12 months will be met from cash on hand, cash provided by operating activities and net proceeds from the issuance of preferred stock.
- 18489021_129Other - OtherAs discussed above, we believe demand for our sonar products is increasing and expect continued improvement in these operations.
- 18489021_145Financial - ExpenseIncluded in these amounts are costs associated with the start-up of the Sealink product line of approximately $569,000 and $1.4 million for the three and nine months ended October 31, 2018, respectively, plus certain one-time restructuring related expenses and incremental costs related to a software upgrade project.
- 18489021_106Revenue - ProductThe increase in the three-month period is due to higher marine technology product revenue, an increase in equipment leasing revenue and higher lease pool and other equipment sales between the periods.
- 18489021_21Other - OtherIn particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities and that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations.
- 18489021_87Other - OtherHowever, competition for such projects is generally intense and there is no assurance that we will have the opportunity to provide equipment for such projects.
- 18489021_74Other - OtherWhile Seamap is not solely dependent on activity related to oil and gas exploration activity, a recovery in marine exploration activity in the petroleum industry could have a materially beneficial effect on our results of operations.
- 18489021_17Revenue - GeographyAdjusted EBITDA excludes non-cash foreign exchange gains and losses, non-cash costs of lease pool equipment sales and stock-based compensation.
- 18489021_189Financial - Shares / EquityIn fiscal 2017 we established an at-the-market ("ATM") offering program whereby we may sell up to 500,000 shares of 9.00% Series A Cumulative Preferred Stock (the "Preferred Stock"), par value $1.00 per share, from time to time.
- 18489021_56Other - OtherWe expect our Equipment Leasing segment to remain an important component of our business; however, we believe capital can in some cases be more efficiently deployed in other areas.
- 18489021_148Financial - ExpenseThe increase in depreciation and amortization expense primarily reflects asset additions associated with the start-up of the Sealink product line.
- 18489021_76Revenue - ProductRevenue from the sale of Klein products in fiscal 2018 and 2017 was significantly below our expectations due primarily, we believe, to (i) an industry wide decline in the purchase of sonar products, (ii) delays in the introduction of new products in fiscal 2017, (iii) competitive pressures, and (iv) delays in project awards by domestic and foreign governmental agencies as result of budget constraints and complex contracting processes.
- 18489021_146Other - OtherDepreciation and amortization includes depreciation of equipment, furniture and fixtures and the amortization of intangible assets.
- 18489021_193Financial - Shares / EquityAs of October 31, 2018 there are 196,094 shares of Preferred Stock available to be issued pursuant to the ATM offering program.
- 18489021_183Other - OtherFrom time to time we may seek to sell certain equipment from our lease pool.
- 18489021_157Other - OtherItems of this nature are considered non-cash in our calculation of Adjusted EBITDA and resulted in a net loss of approximately $336,000 and a net gain of approximately $41,000 in the nine months ended October 31, 2018 and 2017, respectively.
- 18489021_90Other - OtherWe believe this is due in large part to an excess of equipment in the marine seismic market.
- 18489021_194Financial - Shares / EquityIn February 2018 we sold 152,290 shares to Mitsubishi Heavy Industries Ltd. ("MHI") in a privately negotiated transaction in connection with the Hydroscience Acquisition with net proceeds of approximately $3.5 million.
- 18489021_70Financial - ExpenseDue to the required expansion of our existing facilities necessary to support the manufacture and repair of the streamer products, the towed streamer products have not made a significant contribution in the first nine months of fiscal 2019 and the costs associated with these products have exceeded the revenue they have generated to date.
- 18489021_91Financial - ExpenseAs marine contractors have sought to reduce costs by retiring older vessels an excess of used equipment has become available, thereby reducing the demand for rental equipment.
- 18489021_171Other - OtherThe increase in working capital resulted primarily from changes in accounts receivable balances during the first nine months of fiscal 2019.
- 18489021_44Revenue - ProductSince fiscal 2017 we have seen a significant decline in revenues from leasing activity.
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- Form Type: Quarterly
- Number of times amended: 0
- Accession Number: 0001628280-18-014892
- Submitted to the SEC: Thursday, December 6, 2018 5:12:14 PM EST
- Accepted by the SEC: Thursday, December 6, 2018
- Period ending: October 2018
- Industry: Equipment Rental And Leasing
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MITCHAM INDUSTRIES INC
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