CONSOLIDATED SUBSIDIARY OVERVIEW
HOUSTON, Nov. 2, 2015 /PRNewswire/ -- Diamond Offshore Drilling, Inc. (NYSE: DO) today reported net income of $136 million, or $0.99 per share, in the third quarter of 2015, compared to $53 million, or $0.38 per share, in the third quarter of 2014. Revenues in the third quarter of 2015 were $610 million, compared to revenues of $738 million in the third quarter of 2014.
"I am pleased with our solid third quarter results, which demonstrate Diamond Offshore's ability to execute on managing our costs and controlling downtime," said Marc Edwards, President and Chief Executive Officer. "During the quarter, our three newbuild drillships delivered operational efficiency of 99.3 percent, which directly benefits our topline and improves project economics for our clients."
Diamond Offshore also confirmed the Ocean Guardian was awarded a contract for a one-year term in the UK North Sea beginning in March of 2016 at a rate of $220,000 per day.
The Company announced that it reached agreement with Petrobras for contracts on the semisubmersible rig Ocean Alliance and the drillship Ocean Clipper to be ended as of October 30, 2015, ahead of their original end dates, in return for an additional 875 days of contract term on the semisubmersible rig Ocean Courage. The additional term will be at a rate of $380,000 per day, representing revenue backlog of $333 million, and will extend the contract into mid-2020. After export from Brazil, the Ocean Alliance will be cold-stacked and the Ocean Clipper will be retired and scrapped. The terminated portions of the contracts represent a loss to revenue backlog of approximately $91 million.
Diamond Offshore also announced that it has declared a regular quarterly dividend of $0.125 per share, payable on December 1, 2015 to shareholders of record as of November 13, 2015.
A conference call to discuss Diamond Offshore's earnings results has been scheduled for 7:30 a.m. CST today. A live webcast of the call will be available online on the Company's website, www.diamondoffshore.com. Those interested in participating in the question and answer session should dial 800-247-9979 or 973-321-1100, for international callers. The conference ID number is 60130700. An online replay will also be available on www.diamondoffshore.com following the call.
ABOUT DIAMOND OFFSHORE
Diamond Offshore is a leader in offshore drilling, providing contract drilling services to the energy industry around the globe with a total fleet of 33 offshore drilling rigs, including one rig under construction. Diamond Offshore's fleet consists of 23 semisubmersibles, one of which is under construction, four dynamically positioned drillships, and six jack-ups. Additional information about the Company and access to the Company's SEC filings are available at www.diamondoffshore.com. Diamond Offshore is owned 53% by Loews Corporation (NYSE: L).
Contract revenue as stated above assumes 100% rig utilization. Rig utilization rates vary depending on a variety of circumstances, many of which are beyond the Company's control. Rig utilization rates generally approach 92-98% during contracted periods; however, utilization rates can be adversely impacted by additional downtime due to various operating factors, including, but not limited to, weather conditions and unscheduled repairs and maintenance. Additional information on the Company and access to the Company's SEC filings is available at www.diamondoffshore.com.
Statements contained in this press release or made during the above conference call that are not historical facts are "forward-looking statements" within the meaning of the federal securities laws. Such statements include, but are not limited to, statements concerning drilling rig deliveries, operations and timing; contract effectiveness, effective dates and estimated duration; plans regarding retirement and scrapping of drilling rigs; future impairments; future dividends; expectations of future backlog, revenue, operating costs and performance; future liquidity, financial condition, market conditions, commodity prices and strategic opportunities; revenue expected to result from backlog; future credit ratings; future dayrates, future status, start and end dates and future contracts and availability; future contract opportunities and termination rights; contract noncompliance by customers and other third parties; utilization, surveys, downtime and other aspects of the Company's drilling rigs; statements concerning customer discussions and outcomes thereof and the impact of these and related events on the Company's operations and revenues; rigs being upgraded or to be upgraded and rigs under construction; and other statements that are not of historical fact. Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by management of the Company. A discussion of the important risk factors and other considerations that could materially impact these matters as well as the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission, and readers of this press release are urged to review those reports carefully when considering these forward-looking statements. Copies of these reports are available through the Company's website at www.diamondoffshore.com. These risk factors include, among others, risks associated with worldwide demand for drilling services, level of activity in the oil and gas industry, renewing or replacing expired or terminated contracts, contract cancellations and terminations, maintenance and realization of backlog, competition and industry fleet capacity, impairments and retirements, declaration of dividends, operating risks, changes in tax laws and rates, regulatory initiatives and compliance with governmental regulations, construction of new builds, casualty losses, and various other factors, many of which are beyond the Company's control. Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended
Nine Months Ended
Revenues related to reimbursable expenses
Contract drilling, excluding depreciation
General and administrative
Impairment of assets
Restructuring and separation costs
Loss (gain) on disposition of assets
Total operating expenses
Other income (expense):
Foreign currency transaction gain (loss)
Income (loss) before income tax expense
Income tax expense
Net Income (loss)
Income (loss) per share
Weighted average shares outstanding:
Shares of common stock
Dilutive potential shares of common stock
Total weighted average shares outstanding
RESULTS OF OPERATIONS
Total Contract Drilling Revenue
Revenues Related to Reimbursable Expenses
CONTRACT DRILLING EXPENSE
Total Contract Drilling Expense
OPERATING (LOSS) INCOME
Reimbursable expenses, net
General and administrative expense
Gain (loss) on disposition of assets
Impairment of assets
Restructuring and separation costs
Total Operating Income
CONDENSED CONSOLIDATED BALANCE SHEETS
Cash and cash equivalents
Accounts receivable, net of allowance for bad debts
Prepaid expenses and other current assets
Assets held for sale
Drilling and other property and equipment, net of
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt
Other current liabilities
Deferred tax liability
Total liabilities and stockholders' equity
AVERAGE DAYRATES AND UTILIZATION
(Dayrate in thousands)
Average dayrate is defined as contract drilling revenue for all of the specified rigs in our fleet per revenue earning day. A revenue earning day is
defined as a 24-hour period during which a rig earns a dayrate after commencement of operations and excludes mobilization, demobilization and
contract preparation days.
Utilization is calculated as the ratio of total revenue-earning days divided by the total calendar days in the period for all specified rigs in our fleet (including cold-stacked rigs, but excluding rigs under construction). As of September 30, 2015, our cold-stacked rigs included one ultra-deepwater semisubmersible, one deepwater semisubmersible, four mid-water semisubmersibles and five jack-up rigs.
Operational efficiency is calculated as the ratio of total revenue-earning days divided by the sum of total revenue-earning days plus the number of days (or portions thereof) associated with unanticipated equipment downtime.
Average dayrate reported in prior period has been revised to conform to current presentation.
Contact: Darren DaughertyDirector, Investor Relations(281) 492-5370
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SOURCE Diamond Offshore Drilling, Inc.