08/21/09 - Deep Down Announces Second Quarter Results

HOUSTON, TX – August 21, 2009 – Deep Down, Inc. (OTCBB: DPDW) announced today unaudited results for the second quarter ended June 30, 2009.

Revenues for the second quarter of 2009 were $6,200,595, compared to $7,920,196 for the second quarter of 2008, for a 22% decrease. The reduction in revenue over the same prior year period was a result of customers delaying future projects or slowing down many of their offshore and deepwater projects. Net loss for the second quarter ended June 30, 2009, was $1,761,094 as compared to a net loss of $4,865,373 for the same period of 2008.

Gross profit decreased approximately $0.5 million to approximately $1.9 million for the three months ended June 30, 2009, a decrease of approximately 22% compared to the three months ended June 30, 2008. This decrease in gross profit was consistent with the decrease in total revenue. Accordingly, our gross margins remained constant at 30% of revenue for the second quarter of 2009.

“Operations for the past six months have been negatively impacted by the worldwide recession, lower oil prices and delays in many of our major projects,” commented Eugene L. Butler, Chief Financial Officer. “We have also had a slow start on the production of our large floatation order. As a result of this downturn in the industry, our operations in the first half of 2009 were significantly lower than expected and had a negative EBITDA of approximately $1.8 million. The third quarter of 2009 started out sluggish, however, we are finally commencing the production cycle of our large floatation order, we have several ROVs that have started working again, and our offshore service jobs are increasing. Our backlog is currently over $20 million and is expected to continue to increase over the next several quarters. We have also commenced a cost containment program to lower overall costs; particularly, our general and administrative expenses.”

About Deep Down, Inc.

Deep Down, Inc. is an oilfield services company serving the worldwide offshore exploration and production industry. Deep Down’s proven services and technological solutions include distribution system installation support and engineering services, umbilical terminations, loose-tube steel flying leads, distributed and drill riser buoyancy, ROVs and tooling, marine vessel automation, control, and ballast systems. Deep Down supports subsea engineering, installation, commissioning, and maintenance projects through specialized, highly experienced service teams and engineered technological solutions. The company’s primary focus is on more complex deepwater and ultra-deepwater oil production distribution system support services and technologies, used between the platform and the wellhead. Deep Down provides these services through its four subsidiaries. More information about Deep Down is available at www.deepdowncorp.com, by contacting the company at (281) 517-5000, or ir@deepdowninc.com.

© 2008 Deep Down All Rights Reserved

Privacy Policy Disclaimer Site Map

Deep Down Inc. takes the privacy of its users seriously. We are committed to safeguarding the privacy of our users and clients in accordance with worldwide practices for customer privacy and data protection. Deep Down Inc. will not release your personal data to any third parties without your consent or as required by law.

Information collected

We collect personal information from you through the use of inquiry and registration forms and every time you e-mail us your details. We also collect information automatically about your visit to our site. the information obtained in this way, which includes demographic data and browsing patters, is only used in aggregate form. We use your IP address to help diagnose problems with our server, and to administer our web site. We use customer contact information from the registration form to contact the member when necessary and to provide regular information on Deep Down Inc. Users may opt out of receiving mailings.

If you do not wish to receive information about our products or services, or the products or services offered jointly with or on behalf of other organizations, please tic the appropriate box on the registration form. We also use information in aggregate form (so that no individual user is identified):

Use of cookies

We use "cookies" to identify you when you visit DeepDownInc.com, and to build up a demographic profile. A cookie is a small piece of information sent by a web server to a web browser, which enables the server to collect information back from the browser. If you are uncomfortable with cookie technology, you have the option of setting the browser to reject cookies.

Choice/opt-out

You may receive periodic email newsletters from us. These newsletters contain information on new features and facilities of note at the web site. Our site provides users the opportunity to opt-out of receiving communications from us directly.

Internet-based transfers

Given that the Internet is a global environment, using the Internet to collect and process personal data necessarily involves the transmission of data on a international basis. Therefore, by browsing the DeepDownInc.com site and communicating electronically with us, you acknowledge and agree to our processing of personal data in this way. The Privacy Policy Statement does not apply to Third Party Sites.

Changes of these Terms

Deep Down Inc. reserves the right, at its discretion, to make changes to any part of the Site. Due to its policy of updating and improving the site, Deep Down Inc. may wish to change these Terms, (including those relating to your uses of the Content). When terms are changed, we will notify you by e-mail or by publishing details of those changes by including them at the end of these Terms (see "Changes to these Terms"). If you do not agree to be bound by these changes, you should not use the Site any further after they are published at the end of these Terms or after you receive notice of them.


You may not assign, sub-license or otherwise transfer any of your rights under these terms. If any provision of these Terms is found to be invalid by any court having competent jurisdiction, the invalidity of that provision will not affect the validity of the remaining provisions of these Terms, which shall remain in full force and effect. Failure by either party to exercise any right or remedy under these Terms does not constitute a waiver of that right or remedy. Headings in these Terms are for convenience only and will have no legal meaning or affect.

Contacting Deep Down Inc.

If you have any questions about this privacy statement, or the practices of this site, please contact us.

Shareholders

One of our most important responsibilities is to communicate with shareholders in an open and direct manner. Comments are based on current management expectations, and are considered "forward-looking statements," generally preceded by words such as "plans," "expects," "believes," "anticipates," or "intends." We cannot promise future returns. Our statements reflect our best judgment at the time they are issued, and we disclaim any obligation to update or alter forward-looking statements as the result of new information or future events. Deep Down urges investors to review the risks and uncertainties contained within its filings with the Securities and Exchange Commission.

Website

The information contained and accessed on deepdowninc.com (the "Site") is provided for general guidance and is intended to offer the user general information of interest. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, and the inherent hazards of electronic communication, there may be delays, omissions or inaccuracies in information contained in this Site. Accordingly, The information on this Site is provided with the understanding that the authors and publishers are not herein engaged in rendering professional advice or services. As such, it should not be used as a substitute for consultation with professionals. Before making any decision or taking any action, you should consult a Deep Down Inc professional.

While we have made every attempt to ensure that the information contained in this Site has been obtained from reliable sources, Deep Down Inc is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this Site is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will Deep Down Inc, its related partnerships or corporations, or the partners, agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this Site or for any consequential, special or similar damages, even if advised of the possibility of such damages.

Third-part Links

Certain links in this Site connect to other Web Sites maintained by third parties over whom Deep Down Inc has no control. Deep Down Inc makes no representations as to the accuracy or any other aspect of information contained in other Web Sites.

Contacting Deep Down Inc.

If you have any questions about this privacy statement, or the practices of this site, please contact us.