Oceaneering International, Inc. Q2 2008 Earnings Call

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2008-07-31 19:55:25.0

Tags: Oceaneering International Inc.

Question-and-Answer Session

[Operator Instructions]. Your first question is from the line of Jim Crandell [Lehman Brothers].

James Crandell - Lehman Brothers

Good morning every one.

T. Jay Collins - President and Chief Executive Officer

Good morning, Jim.

Marvin J. Migura - Senior Vice President and Chief Financial Officer

Good morning, Jim.

James Crandell - Lehman Brothers

Jay, there has been delays in subsea tree orders. But it seems that the delay is in umbilical order. They are much greater. Can you... I have a two fold question. One; can you give us some specifics in terms of projects that went into your forecast early in the year where you expected umbilical orders that looked to be delayed? And then give your thoughts on, why they are being delayed in each case?

T. Jay Collins - President and Chief Executive Officer

Jim we continue to try to understand the time interval between tree orders and umbilical orders, and I'm not sure that we fully understand that. I think that the tree order fairly is placed... we think earlier in the process, the umbilical order tends to be more in part of the installation process.

And I guess one think that we have learnt is that the umbilical will connect all the piece of Sebsea back together. So as long as there is any design changes an issues going on about the architecture of the subsea field or who... what vessel will do the installation, people really don't want to order the umbilical.

So that seems to be continuing to delay the umbilical orders longer in the stock than we would have imagined.

James Crandell - Lehman Brothers

Of every project that was on the drawing board that was being planned at the beginning of the year as far as you know was still... is still out there?

T. Jay Collins - President and Chief Executive Officer

Right we do not see cancellations on our list. So the projects are still there and as I... measuring volume up our year outlook is the highest total that we've seen in the last... really ever. So we see more activity like the Quest forecast we see more activity looking out of year but we just don't have the orders yet.

James Crandell - Lehman Brothers

So you just sales people on conversation with the customers, Jay, are they coming up with any reasons for the delays? I know that you decided to meet not to longer ago there was some debate about whether to go with steel with on plastic and there seems to be some other issues as well. Can you maybe expand on that?

 

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