W&T Offshore, Inc. (WTI) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $24.30 million, or $ 0.17 a share in the quarter, against a net loss of $190.51 million, or $2.49 a share in the last year period. On an adjusted basis, net profit for the quarter stood at $22.78 million, or $0.16 a share compared with a net loss of $72.73 million, or $0.95 a share in the last year period. Revenue during the quarter surged 60.06 percent to $124.39 million from $77.72 million in the previous year period. Gross margin for the quarter expanded 2676 basis points over the previous year period to 62.31 percent.
Operating income for the quarter was $28.20 million, compared with an operating loss of $166.61 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $65.20 million compared with $16.55 million in the prior year period. At the same time, adjusted EBITDA margin improved 3111 basis points in the quarter to 52.41 percent from 21.30 percent in the last year period.
Tracy W. Krohn, W&T Offshore's Chairman and Chief Executive Officer, stated, "Our first quarter 2017 results greatly improved over the same time last year as we benefited from higher commodity prices and lower expenses, allowing us to continue to generate net income and solid free cash flow. Production was up about 6% sequentially and down only 2.5% from a year ago, on very modest drilling activity, with our continuing success at Mahogany whereby we can put successful wells on line quickly increasing production along with our beneficial workover and recompletion program. Additionally, unlike many shale wells, the Gulf of Mexico wells don't typically exhibit as steep of a decline curve and thereby contribute strong production rates well past the initial production phase by comparison."
Operating cash flow improves significantly
W&T Offshore, Inc. has generated cash of $81.18 million from operating activities during the quarter, up 173.26 percent or $51.47 million, when compared with the last year period. The company has spent $23.02 million cash to meet investing activities during the quarter as against cash outgo of $32.58 million in the last year period.
The company has spent $2.30 million cash to carry out financing activities during the quarter as against cash inflow of $288.08 million in the last year period.
Cash and cash equivalents stood at $126.10 million as on Mar. 31, 2017, down 65.98 percent or $244.53 million from $370.62 million on Mar. 31, 2016.
Working capital drops significantly
W&T Offshore, Inc. has witnessed a decline in the working capital over the last year. It stood at $18.27 million as at Mar. 31, 2017, down 71.28 percent or $45.34 million from $63.61 million on Mar. 31, 2016. Current ratio was at 1.09 as on Mar. 31, 2017, down from 1.17 on Mar. 31, 2016.
Days sales outstanding went down to 47 days for the quarter compared with 60 days for the same period last year.
At the same time, days payable outstanding went up to 226 days for the quarter from 222 for the same period last year.
Debt comes down significantly
W&T Offshore, Inc. has recorded a decline in total debt over the last one year. It stood at $1,018.98 million as on Mar. 31, 2017, down 31.38 percent or $465.97 million from $1,484.95 million on Mar. 31, 2016. Total debt was 119.25 percent of total assets as on Mar. 31, 2017, compared with 114.33 percent on Mar. 31, 2016.
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