Tidewater Inc. (NYSE:TDW) Q2 2019 Earnings Conference Call - Final Transcript
Aug 13, 2019 • 11:00 am ET
Quintin V. Kneen
will continue to make you aware of these costs as we have in the past three quarters. These amounts will pick up in the third and fourth quarter as professional fees related to the integration increase, as we approach the go-live date.
The cash balance at the end of the year was $383 million, down $15 million from the prior quarter. We mentioned on last quarter's call that we anticipated that the second quarter to be a use of cash due to the timing of drydock payments and other working capital matters. The use was a bit higher than we anticipated and we saw a sharper build in accounts receivable than we were expecting from a few clients. I'm not concerned about the flexibility of any of these amounts, and I anticipate that these will be cleared up in the third and fourth quarters of 2019.
In the first half of 2019, the Company was free cash flow positive in amount of $2 million and we anticipate being in free cash flow positive for the full year. For the second quarter of 2019, the Company was free cash flow negative in the amount of $6.7 million, driven by the build in receivables.
We do include proceeds from vessel disposals in our determined free cash flow. We see these vessels as excess inventory and we are liquidating disposition [Phonetic] over time. For the first half of 2019, we have proceeds of $20.6 million from the disposal of obsolete vessels. The 60 vessels remaining in layup have a combined book value of $126 million, and that amount is included in property and equipment on the balance sheet. Since quarter-end, we have sold three additional vessels for total proceeds of $4.4 million.
And with that, I will turn the call back over to John for his final comments.
John T. Rynd
Thank you, Quentin. We are optimistic that we are investing in the right people, processes and vessels to thrive through this protracted downturn and beyond. This includes responsibly reducing costs, while ensuring that operational performance remained industry leading. Additionally, we will maintain active supply on the basis of its economic viability and will not chase market share at the expense of profitability. This discipline by us and other market participants, will continue to facilitate the needed recovery in day rates that has begun evidencing itself the past two quarters.
While we cannot predict the pace of the recovery, we see reasons for optimism in each of our markets and believe -- we believe that we are in the best position to capitalize on the fundamental improvements.
Adriane, please open the call up for Q&A.