THE WOODLANDS, Texas, July 29 /PRNewswire-FirstCall/ -- Newpark Resources, Inc. (NYSE: NR) today announced results for its second quarter ended June 30, 2010. Total revenues were $181.4 million for the second quarter of 2010 compared to $160.8 million for the first quarter of 2010 and $109.6 million for the second quarter of 2009. Net income for the second quarter of 2010 was $10.8 million, or $0.12 per diluted share, compared to net income for the first quarter of 2010 of $7.8 million, or $0.09 per diluted share, and a net loss for the second quarter of 2009 of $8.8 million, or a loss of $0.10 per share.

Paul Howes, President and Chief Executive Officer of Newpark, stated, "We continue to be pleased with the ongoing sequential improvement in all of our operating segments. Our domestic revenues rose 21% from the first quarter of 2010. This was driven by a 13% increase in U.S. drilling activity, along with our expansion in the Northeast U.S. region and continued growth in the Haynesville shale, due in part to the success of our new high performance water-based fluids. In addition, waste disposals and product sales associated with the Deepwater Horizon oil spill contributed $2.7 million of revenue to the second quarter. Our international revenues increased as our Mediterranean region rebounded nicely from the first quarter. Also, on a sequential basis, operating income improved by $6.2 million, or 45%, on a $20.6 million increase in revenues, reflecting a strong incremental margin of 30%."

Segment Results

The Fluids Systems and Engineering segment generated revenues of $150.5 million in the second quarter of 2010 compared to $136.3 million in the first quarter of 2010 and $89.6 million in the second quarter of 2009. Segment operating income was $15.2 million in the second quarter of 2010 compared to $12.4 million in the first quarter of 2010 and an operating loss of $1.7 million in the second quarter of 2009. North American revenues increased 10% from the first quarter of 2010, which included an 18% improvement in the U.S., partially offset by the seasonal decline in Canada. Meanwhile, international revenues increased 11% from the first quarter of 2010, driven by a rebound in activity in North Africa and Europe. Compared to the second quarter of 2009, North American revenues increased 93%, while international revenues increased 26%.

The Mats and Integrated Services segment generated revenues of $17.0 million in the second quarter of 2010 compared to $13.6 million in the first quarter of 2010 and $8.6 million in the second quarter of 2009. Segment operating income was $5.0 million in the second quarter of 2010 compared to operating income of $2.7 million in the first quarter of 2010 and an operating loss of $4.8 million in the second quarter of 2009. Revenues were up 25% from the first quarter of 2010, driven by a $3.5 million increase in rental activity in the Northeast U.S. region. Compared to the second quarter of 2009, segment revenues were up 97%.

The Environmental Services segment generated revenues of $13.8 million in the second quarter of 2010 compared to $10.9 million in the first quarter of 2010 and $11.3 million in the second quarter of 2009. Segment operating income was $4.2 million in the second quarter of 2010, compared to operating income of $2.7 million in the first quarter of 2010 and $1.4 million in the second quarter of 2009. The second quarter of 2010 includes $2.0 million of revenue from waste disposals associated with the Deepwater Horizon oil spill.

CONFERENCE CALL

Newpark has scheduled a conference call to discuss the second quarter 2010 results, which will be broadcast live over the Internet, on Friday, July 30, 2010 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time. To participate in the call, dial 480-629-9692 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 August 6, 2010 and may be accessed by dialing (303) 590-3030 and using pass code 4313117#. 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, 2009, as well as others, could cause results to differ materially from those stated. These risk factors include, but are not limited to, our customer concentration and cyclical nature of our industry, the availability of raw materials and skilled personnel, 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 restrictions on offshore drilling activity in the Gulf of Mexico. 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.

    Contacts:       James E. Braun, CFO
                    Newpark Resources, Inc.
                    281-362-6800

                    Ken Dennard, Managing Partner
                    Dennard Rupp Gray & Easterly, LLC
                    ksdennard@drg-e.com
                    713-529-6600

    Newpark Resources, Inc.
    Consolidated Statements of Operations


    (Unaudited)                                 Three Months Ended
                                                ------------------
                                              June     March     June
    (In thousands, except per share            30,       31,      30,
     data)                                    2010      2010     2009
    -------------------------------           ----      ----     ----


        Revenues                            $181,352  $160,798  $109,599

        Cost of revenues                     145,299   133,518   103,906
        Selling, general and administrative
         expenses                             16,360    14,413    15,652
        Other income, net                       (203)     (842)      (37)
                                                ----      ----       ---

        Operating income (loss)               19,896    13,709    (9,922)

        Foreign currency exchange gain        (1,213)     (611)     (590)
        Interest expense                       2,228     2,148     1,600
                                               -----     -----     -----

        Income (loss) from operations
         before income taxes                  18,881    12,172   (10,932)
        Provision for income taxes             8,041     4,390    (2,145)
                                               -----     -----    ------

        Net income (loss)                    $10,840    $7,782   $(8,787)
                                             =======    ======   =======


    Basic weighted average common
     shares outstanding                       88,818    88,654    88,514
    Diluted weighted average common
     shares outstanding                       89,392    88,867    88,514

    Income (loss) per common share -
     basic                                     $0.12     $0.09    $(0.10)
    Income (loss) per common share -
     diluted                                   $0.12     $0.09    $(0.10)

    Newpark Resources, Inc.
    Operating Segment Results

    (Unaudited)                          Three Months Ended
    -----------                          ------------------
                                June 30,      March 31,        June 30,
    (In thousands)                2010          2010             2009
    --------------             ---------     ----------       ---------

    Revenues
      Fluids systems and
       engineering               $150,534       $136,310         $89,642
      Mats and integrated
       services                    16,981         13,620           8,638
      Environmental services       13,837         10,868          11,319
                                   ------         ------          ------
        Total revenues           $181,352       $160,798        $109,599
                                 ========       ========        ========

    Operating income (loss)
      Fluids systems and
       engineering                $15,164        $12,414         $(1,722) (2)
      Mats and integrated
       services                     5,036          2,714  (1)     (4,774) (2)
      Environmental services        4,224          2,679           1,385  (2)
      Corporate office             (4,528)        (4,098)         (4,811) (2)
                                   ------         ------          ------
        Total operating income
         (loss)                   $19,896        $13,709         $(9,922)
                                  =======        =======         =======

    Segment operating margin
      Fluids systems and
       engineering                   10.1%           9.1%          (1.9%)
      Mats and integrated
       services                      29.7%          19.9%         (55.3%)
      Environmental services         30.5%          24.7%           12.2%

    (1)  Includes $0.9 million of other income related to proceeds from
    insurance claims associated with Hurricane Ike in 2008.

    (2) Includes a total of $4.8 million of charges for employee
    termination and related costs associated with North American
    workforce reductions, the non-renewal of barge leases and asset
    write-downs, including $1.0 million in fluids systems and
    engineering, $2.6 million in mats and integrated services, $1.0
    million in environmental services, and $0.2 million in
    corporate office.

    Newpark Resources, Inc.
    Consolidated Balance Sheets

    (Unaudited)
    ------------------------------------------------------------------
                                                 June 30, December 31,
    (In thousands, except share data)              2010       2009
    ---------------------------------              ----       ----

    ASSETS
      Cash and cash equivalents                   $12,213    $11,534
      Receivables, net                            172,475    122,386
      Inventories                                 116,470    115,495
      Deferred tax asset                           35,315      7,457
      Prepaid expenses and other current assets    12,060     11,740
                                                   ------     ------
        Total current assets                      348,533    268,612

      Property, plant and equipment, net          215,336    224,625
      Goodwill                                     60,873     62,276
      Other intangible assets, net                 14,350     16,037
      Other assets                                  4,366     13,564
                                                    -----     ------
        Total assets                             $643,458   $585,114
                                                 ========   ========

    LIABILITIES AND STOCKHOLDERS' EQUITY
      Foreign bank lines of credit                 $5,286     $6,901
      Current maturities of long-term debt         10,192     10,319
      Accounts payable                             76,183     62,992
      Accrued liabilities                          31,397     25,290
                                                   ------     ------
        Total current liabilities                 123,058    105,502

      Long-term debt, less current portion        104,588    105,810
      Deferred tax liability                       30,378      2,083
      Other noncurrent liabilities                  4,224      3,697
                                                    -----      -----
        Total liabilities                         262,248    217,092

      Common stock, $0.01 par value, 200,000,000
       shares authorized
        92,599,210 and 91,672,871 shares issued,
         respectively                                 926        917
      Paid-in capital                             463,366    460,544
      Accumulated other comprehensive income          307      8,635
      Retained deficit                            (68,038)   (86,660)
      Treasury stock, at cost; 2,717,363 and
       2,727,765 shares, respectively             (15,351)   (15,414)
                                                  -------    -------
        Total stockholders' equity                381,210    368,022
                                                  -------    -------
      Total liabilities and stockholders' equity $643,458   $585,114
                                                 ========   ========

    Newpark Resources, Inc.
    Consolidated Statements of Cash Flows

    (Unaudited)                                  Six Months Ended June 30, 
    -----------                                  -------------------------
                                        
    (In thousands)                                  2010             2009
    --------------                                  ----             ----
    Cash flows from operating
     activities:
    Net income (loss)                              $18,622         $(20,791)
    Adjustments to reconcile net income (loss) to
     net cash provided by operations:
       Non-cash impairment charges                     150              941
       Depreciation and amortization                13,298           14,093
       Stock-based compensation expense              1,930            1,190
       Provision for deferred income
        taxes                                        9,402           (6,256)
       Provision for doubtful accounts                 542            1,533
       Gain on sale of assets                         (189)            (265)
       Change in assets and liabilities:
          (Increase) decrease in
           receivables                             (54,167)         111,652
          (Increase) decrease in inventories        (4,132)          12,658
          (Increase) decrease in other
           assets                                     (558)             427
          Increase (decrease) in accounts
           payable                                  15,742          (45,083)
          Increase (decrease) in accrued
           liabilities and other                     7,162          (12,592)
                                                     -----          -------
    Net cash provided by operating
     activities                                      7,802           57,507

    Cash flows from investing
     activities:
       Capital expenditures                         (5,995)         (14,139)
       Proceeds from sale of property,
        plant and equipment                          1,318              734
                                                     -----              ---
    Net cash used in investing
     activities                                     (4,677)         (13,405)

    Cash flows from financing
     activities:
       Borrowings on lines of credit                99,027           84,934
       Payments on lines of credit                (100,782)        (128,701)
       Principal payments on notes
        payable and long-term debt                    (305)            (195)
       Proceeds from employee stock plans              902              104
       Purchase of treasury stock                     (153)            (212)
                                                      ----             ----
    Net cash used in financing
     activities                                     (1,311)         (44,070)

    Effect of exchange rate changes on
     cash                                           (1,135)          (1,573)
                                                    ------           ------

    Net increase in cash and cash
     equivalents                                       679           (1,541)
    Cash and cash equivalents at
     beginning of period                            11,534            8,252
                                                    ------            -----

    Cash and cash equivalents at end
     of period                                     $12,213           $6,711
                                                   =======           ======

SOURCE Newpark Resources, Inc.