Release Details

THE WOODLANDS, Texas, April 26, 2012 /PRNewswire/ -- Newpark Resources, Inc. (NYSE: NR) today announced results for its first quarter ended March 31, 2012.  Total revenues for the first quarter of 2012 were $262.3 million compared to $263.5 million for the fourth quarter 2011 and $202.7 million for the first quarter of 2011.  Net income for the first quarter of 2012 was $15.6 million, or $0.16 per diluted share, compared to $21.9 million, or $0.22 per diluted share, for the fourth quarter of 2011, and $15.9 million, or $0.16 per diluted share, for the first quarter of 2011.

Paul Howes, Newpark's President and Chief Executive Officer, stated, "We are pleased that revenue remained strong in the first quarter, however, we were disappointed by the profitability within our U.S. operations of the Fluids Systems and Engineering segment.  North American drilling fluids revenues increased 30% from the first quarter of 2011, however, were down 2% sequentially due to deterioration in our mid-continent completion services and equipment rental business, reduced activity in certain dry gas regions in the U.S. and an early Spring break-up in Canada.  Our Evolution® drilling fluid system continues its solid performance, generating revenues of $23 million in the first quarter.  International drilling fluids revenues were flat sequentially but increased 22% from the first quarter of 2011, primarily reflecting our strategic entry into the Asia Pacific market in April of 2011. Our Mats and Integrated Services and our Environmental Services segments' revenue grew 32% and 46%, respectively, from the first quarter of 2011, and also grew on a sequential basis.

"While drilling fluid revenues were strong, we did experience operating margin declines in the U.S., resulting from increased raw material costs, particularly barite, as we were unable to pass these cost increases along to our customers in a timely manner.  In addition, due to the tightness in barite supply, we temporarily reduced our third party barite sales during the first quarter, further deteriorating operating margins.  The period was also negatively impacted by a reduction in dry gas activity in certain regions of the U.S., weakness in our completions services and equipment rental business, and continued support costs associated with our ERP system implementation.  We are taking actions to address these margin-related issues and remain focused on improving our profitability as we continue to build the foundation for solid revenue growth," concluded Howes.

Segment Results

The Fluids Systems and Engineering segment generated revenues of $218.5 million in the first quarter of 2012 compared to $221.1 million in the fourth quarter of 2011 and $170.5 million in the first quarter of 2011.  Segment operating income was $14.0 million (6.4% operating margin) in the first quarter of 2012, compared to $25.0 million in the fourth quarter of 2011 (11.3% operating margin) and $19.2 million (11.3% operating margin) in the first quarter of 2011. 

The Mats and Integrated Services segment generated revenues of $30.5 million in the first quarter of 2012 compared to $29.4 million in the fourth quarter of 2011 and $23.1 million in the first quarter of 2011.  Segment operating income was $14.3 million (47.0% operating margin) in the first quarter of 2012, compared to $11.7 million in the fourth quarter of 2011 (39.7% operating margin) and $11.8 million (51.1% operating margin) in the first quarter of 2011. 

The Environmental Services segment generated revenues of $13.3 million in the first quarter of 2012 compared to $13.0 million in the fourth quarter of 2011 and $9.1 million in the first quarter of 2011.  Segment operating income was $3.6 million (26.9% operating margin) in the first quarter of 2012, compared to $2.4 million in the fourth quarter of 2011 (18.1% operating margin) and $1.6 million (17.8 % operating margin) in the first quarter of 2011.

SHARE REPURCHASE PROGRAM

During the first quarter of 2012, the Company announced the approval of a $50 million share repurchase program.  Following this announcement, the Company established a trading plan under Rule 10b5-1 of the Securities Exchange Act of 1934 and repurchased $15 million of outstanding shares of Newpark common stock at an average cost of $8.06 per share, reducing common shares outstanding by approximately 1.9 million shares.

CONFERENCE CALL

Newpark has scheduled a conference call to discuss first quarter 2012 results, which will be broadcast live over the Internet, on Friday, April 27, 2012 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time.  To participate in the call, dial 480-629-9835 and ask for the Newpark Resources conference call at least 10 minutes prior to the start time, or access it live over the Internet at www.newpark.com.  For those who cannot listen to the live call, a replay will be available through May 4, 2012 and may be accessed by dialing (303) 590-3030 and using pass code 4528279#.  Also, an archive of the webcast will be available shortly after the call at www.newpark.com for 90 days.

Newpark Resources, Inc. is a worldwide provider of drilling fluids, temporary worksites and access roads for oilfield and other commercial markets, and environmental waste treatment solutions.  For more information, visit our website at www.newpark.com.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act that are based on management's current expectations, estimates and projections. All statements that address expectations or projections about the future, including Newpark's strategy for growth, product development, market position, expected expenditures and financial results are forward-looking statements. Some of the forward-looking statements may be identified by words like "expects," "anticipates," "plans," "intends," "projects," "indicates," and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Newpark, particularly its Annual Report on Form 10-K for the year ended December 31, 2011, as well as others, could cause results to differ materially from those stated. These risk factors include, but are not limited to, the availability of raw materials and skilled personnel, the impact of restrictions on offshore drilling activity in the Gulf of Mexico, our customer concentration and cyclical nature of our industry, our market competition, the cost and continued availability of borrowed funds, our international operations, legal and regulatory matters, including environmental regulations, inherent limitations in insurance coverage, potential impairments of long-lived intangible assets, technological developments in our industry, the impact of severe weather, particularly in the U.S. Gulf Coast, and our ability to execute our business strategy and make successful capital investments and business acquisitions.  Newpark's filings with the Securities and Exchange Commission can be obtained at no charge at www.sec.gov, as well as through our website at www.newpark.com.

SOURCE Newpark Resources, Inc.