| Unifab International, Inc. | |||
| Ticker: | UFAB | 5007 Port Road | |
| Exchange: | NASDAQ-National Market | New Iberia, LA 70562 | |
| Industry: | Manufacturing (SIC Code 3441) | (318) 367-8291 | |
| Type of Shares: | Common Shares | Filing Date: | 7/18/97 | |
| U.S. Shares: | 2,815,000 | Offer Date: | 9/18/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $14.00 - $16.00 | |
| Primary Shares: | 1,100,000 | Offer Price: | $18.00 | |
| Secondary Shares: | 1,715,000 | Gross Spread: | $1.26 | |
| Offering Amount: | $42,225,000 | Selling: | $0.75 | |
| Expenses: | - | Reallowance: | $0.10 | |
| Shares Out After: | 4,600,000 |
| Manager | Tier | Phone |
| Morgan Keegan & Company, Incorporated | Lead Manager | (901) 529-5357 |
| Stephens Inc. | Co-manager | (501) 377-2130 |
| Issuer's Law Firm: | Jones, Walker,Waechter, Poitevent Carrere & Denegr |
| Bank's Law Firm: | Andrews & Kurth |
| Auditor: | Ernst & Young |
Dollar amounts in U.S. millions except for per share data | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 3/31/97 | 3/31/97 | ||||
| Revenue: | $66.72 | Assets: | $26.16 | ||
| Net Income: | $4.03 | Curr Assets: | |||
| EPS: | $1.15 | Liabilities: | $17.58 | ||
| Prior EPS: | $1.84 | Curr Liabilities: | |||
| Cash Flow/Oper: | $2.33 | Equity: | $8.58 | ||
| Cash Flow/Fin: | Cash: | ||||
| Cash Flow/Inv: | |||||
| Business Description |
| The company is an industry leader in the custom fabrication of decks and modules of drilling and production equipment weighing up to 3,500 tons of offshore oil and gas platforms and has special expertise in the fabrication of decks with complex piping. Decks and modules fabricated by the Company can be installed on fixed and floating platforms regardless of water depth. The Company also fabricates jackets for fixed platforms; pilings and other rolled tubular steel sections; compressor and generator packages; platform living quarters; subsea templates; bridges for connecting offshore platforms; wellhead protectors; and modules for the onshore petrochemical and refining industries. In addition, the Company refurbishes and retrofits existing jackets and decks and performs offshore piping hook-up and platform maintenance services. Structures fabricated by the Company are installed in oil and gas producing waters around the world, primarily the U.S. Gulf of Mexico (the "Gulf of Mexico") and offshore West Africa. The Company, founded in 1980, has been profitable for each of the last five years largely as a result of management's ability to control costs, provide high quality, reliable services, and expand successfully into international markets.The Company believes its strong presence in both overseas markets and the Gulf of Mexico market, coupled with continued strong oil and gas activity in these markets, has enabled it to selectively obtain high margin fabrication work and benefit from increased pricing levels. |
| Competition |
| The offshore platform fabrication industry is highly competitive and influenced by events largely outside of the control of offshore platform fabrication companies. Since 1992, there has been a consolidation in the industry as several marine construction companies have combined with other companies or ceased operations altogether. As a result of this consolidation, there are approximately eight remaining domestic competitors for custom fabrication projects, several of which are substantially larger and have greater resources and capabilities than the Company. These companies compete intensely for available projects, which are generally awarded on a competitive bid basis with customers usually requesting bids on projects one to three months prior to commencement. For international projects, the Company competes with many of the same domestic fabricators, as well as with several foreign fabricators, some of which are substantially larger and have greater financial resources and capabilities than the Company. The Company's marketing staff contacts offshore construction contractors and oil and gas companies to obtain information as to upcoming projects so that the Company will be well positioned to bid for the projects. Although price and the contractor's ability to meet a customer's delivery schedule are the principal factors in determining which qualified fabricator is awarded a contract for a project, customers also consider, among other things, the availability of technically capable personnel and facility space, a fabricator's efficiency, condition of equipment, reputation, safety record and customer relations. The Company believes that the limited availability of experienced supervisory and management personnel, as well as skilled laborers, presents the greatest barrier to entry to new companies trying to enter the fabrication industry. The Company believes that its competitive pricing, expertise in fabricating offshore marine structures and its long-term relationships with international customers will enable it to continue to compete effectively for projects destined for international waters. The Company recognizes, however, that foreign governments often use subsidies and incentives to create jobs where oil and gas production is being developed. The additional transportation costs that will be incurred when exporting structures from the U.S. to foreign locations may hinder the Company's ability to successfully bid for projects against foreign competitors. Because of subsidies, import duties and fees, taxes on foreign operators and lower wage rates in foreign countries along with fluctuations in the value of the U.S. dollar and other factors, the Company may find it increasingly difficult to remain competitive with foreign contractors for projects designed for use in international waters. |
| Business Plan |
| The company's growth and profitability strategy is to capitalize on the positive trends and current opportunities in heavy marine fabrication for the oil and gas industry. Key elements of the company's strategy are to: (I) Pursue Expanding Markets, (ii) Expand Facilities, (iii) Manage Backlod, (iv) Improve Workforce Efficiency and (v) Increase Employee Pool. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to fund capital expenditures for certain new equipment, slips, bulkheads an load out systems and for the upgrade and purchase of yard space, land, buildings and equipment, a payment to McDermott for the surrender of its rights under the Shareholders' Agreement and the Put/Call Agreement, for working capital and for general corporate purposes. |
| Name of Shareholder | % Owned Before | % Owned After |
| McDermott Incoporated | 49.00% | |
| Perry Segura | 12.40% | 9.50% |
| Dailey J. Berard | 11.80% | 9.00% |
| Charles E. Broussard | 11.60% | 8.80% |
| Officer Name | Title | Age |
| Dailey J. Berard | President, Chief Executive Officer and Chairman of the Board | 68 |
| David J. Berard | Vice President -- Domestic Sales | 51 |
| Dennis W. LaFleur | Vice President -- International Sales | 51 |
| Larry L. Clement | Vice President -- Operations | 53 |
| Louis C. Peltier | Vice President -- Power and Equipment | 67 |
| Peter J. Roman | Vice President and Chief Financial Officer | 46 |