LOEWS CORPORATION HOUSTON, May 1, 2017 /PRNewswire/ -- Diamond Offshore Drilling, Inc. (NYSE: DO) today reported results for the first quarter of 2017.
Three Months Ended
------------------
Thousands
of
dollars,
except
per share
data March 31, 2017 December 31, 2016 Change
---------- -------------- ----------------- ------
Total
revenues $374,226 $391,874 (5)%
Operating
income 50,859 104,145 (51)%
Net income 23,539 116,082 (80)%
Earnings
per
diluted
share $0.17 $0.85 (80)%
"Despite a continually challenging market, Diamond Offshore achieved earnings per share of $0.17 for the first quarter of 2017," said Marc Edwards, President and Chief Executive Officer. "Overall, I am pleased with our first quarter results and our ability to manage costs, while remaining focused on maintaining our operational and technical excellence. The Ocean GreatWhite, Ocean Scepter and the Ocean BlackRhino all commenced term contracts in the first quarter, enhancing our already strong liquidity." Edwards went on to say, "During the first quarter, the Ocean BlackLion successfully drilled and completed one of the deepest and most complex wells on record in the Gulf of Mexico."
Also during the quarter, the Company executed new contracts for the Ocean Monarch in Australia, the first of which is scheduled to commence in late first quarter of 2018. Combined, these contracts add nine months of backlog and will keep the Ocean Monarch contracted through 2018. Additionally, the Company executed a new two-year term contract with Apache for the Ocean Patriot in the North Sea. The rig is scheduled to commence its new program in the second quarter of 2018.
As of March 31, 2017, the Company's total contracted backlog was $3.2 billion, which represents 23 rig years of work.
CONFERENCE CALL
A conference call to discuss Diamond Offshore's earnings results has been scheduled for 7:30 a.m. CDT 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 844-492-6043 or 478-219-0839, for international callers. The conference ID number is 1792549. 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. Additional information and access to the Company's SEC filings are available at www.diamondoffshore.com. Diamond Offshore is owned 53% by Loews Corporation (NYSE: L).
FORWARD-LOOKING STATEMENTS
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. 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, 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
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended,
March 31,
---------
2017 2016
---- ----
Revenues:
Contract drilling $363,557 $443,523
Revenues related to reimbursable expenses 10,669 27,020
------ ------
Total revenues 374,226 470,543
------- -------
Operating expenses:
Contract drilling, excluding depreciation 203,523 212,841
Reimbursable expenses 10,478 26,791
Depreciation 93,229 104,240
General and administrative 17,483 15,398
Gain on disposition of assets (1,346) (296)
------ ----
Total operating expenses 323,367 358,974
------- -------
Operating income 50,859 111,569
Other income (expense):
Interest income 175 173
Interest expense (27,596) (25,516)
Foreign currency transaction gain (loss) 1,087 (3,608)
Other, net (63) 578
--- ---
Income before income tax (expense) benefit 24,462 83,196
Income tax (expense) benefit (923) 4,229
---- -----
Net income $23,539 $87,425
======= =======
Income per share $0.17 $0.64
===== =====
Weighted-average shares outstanding:
Shares of common stock 137,173 137,162
Dilutive potential shares of common stock 77 44
--- ---
Total weighted-average shares outstanding 137,250 137,206
======= =======
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS
(Unaudited)
(In thousands)
Three Months Ended
------------------
March 31, December 31, March 31,
--------- ------------ ---------
2017 2016 2016
---- ---- ----
REVENUES
Floaters:
Ultra-Deepwater $243,465 $231,820 $325,961
Deepwater 67,943 64,678 59,117
Mid-Water 48,285 88,130 47,672
------ ------ ------
Total Floaters 359,693 384,628 432,750
Jack-ups 3,864 18 10,773
Total Contract
Drilling Revenue 363,557 384,646 $443,523
======= ======= ========
Revenues Related to
Reimbursable Expenses $10,669 $7,228 $27,020
======= ====== =======
CONTRACT DRILLING EXPENSE
Floaters:
Ultra-Deepwater $141,873 $119,490 $123,736
Deepwater 33,080 30,481 47,509
Mid-Water 19,267 16,814 23,884
------ ------ ------
Total Floaters 194,220 166,785 195,129
Jack-ups 5,323 3,090 6,055
Other 3,980 4,467 11,657
----- ----- ------
Total Contract
Drilling Expense $203,523 $174,342 $212,841
======== ======== ========
Reimbursable Expenses $10,478 $6,775 $26,791
======= ====== =======
OPERATING INCOME
Floaters:
Ultra-Deepwater $101,592 $112,330 $202,225
Deepwater 34,863 34,197 11,608
Mid-Water 29,018 71,316 23,788
------ ------ ------
Total Floaters 165,473 217,843 237,621
Jack-ups (1,459) (3,072) 4,718
Other (3,980) (4,467) (11,657)
Reimbursable expenses,
net 191 453 229
Depreciation (93,229) (86,031) (104,240)
General and
administrative
expense (17,483) (14,786) (15,398)
Bad debt recovery -- 265 --
Gain (loss) on
disposition of assets 1,346 (6,060) 296
Total Operating Income $50,859 $104,145 $111,569
======= ======== ========
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
March 31, December 31,
2017 2016
---- ----
ASSETS
Current assets:
Cash and cash equivalents $123,316 $156,233
Marketable securities 24 35
Accounts receivable, net of
allowance for bad debts 286,408 247,028
Prepaid expenses and other
current assets 105,355 102,111
Asset held for sale 400 400
Total current assets 515,503 505,807
Drilling and other property and equipment,
net of accumulated depreciation
5,616,367 5,726,935
Other assets 137,073 139,135
------- -------
Total assets $6,268,943 $6,371,877
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term borrowings $ -- $104,200
Other current liabilities 201,583 236,299
Long-term debt 1,981,169 1,980,884
Deferred tax liability 191,594 197,011
Other liabilities 120,602 103,349
Stockholders' equity 3,773,995 3,750,134
--------- ---------
Total liabilities and
stockholders' equity $6,268,943 $6,371,877
========== ==========
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Three months ended
March 31,
---------
2017 2016
---- ----
Operating activities:
Net income $23,539 $87,425
Adjustments to reconcile net income
to net cash
provided by operating activities
Depreciation 93,229 104,240
Deferred tax
provision (5,988) (45,254)
Other 17,367 19,957
Net changes in
operating working
capital (29,471) 74,962
Net cash provided by
operating activities 98,676 241,330
------ -------
Investing activities:
Capital expenditures
(including rig
construction) (29,487) (58,114)
Proceeds from
disposition of
assets, net of
disposal costs 2,097 113,295
Other 11 11
--- ---
Net cash (used in)
provided by
investing activities (27,379) 55,192
------- ------
Financing activities:
Repayment of short-
term borrowings, net (104,200) (286,589)
Other (14) (33)
Net cash used in
financing activities (104,214) (286,622)
-------- --------
Net change in cash
and cash equivalents (32,917) 9,900
Cash and cash
equivalents,
beginning of period 156,233 119,028
------- -------
Cash and cash
equivalents, end of
period $123,316 $128,928
======== ========
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
AVERAGE DAYRATE, UTILIZATION AND OPERATIONAL EFFICIENCY
(Dayrate in thousands)
First Quarter Fourth Quarter First Quarter
2017 2016 2016
---- ---- ----
Average Operational Efficiency Average Operational Efficiency Average Operational Efficiency
Dayrate (1) Utilization (2) (3) Dayrate (1) Utilization (2) (3) Dayrate Utilization (2) (3)
(1)
--- ---
Ultra-Deepwater
Floaters $450 50% 91.1% $456 49% 92.0% $533 61% 98.4%
Deepwater
Floaters $260 48% 96.6% $287 39% 92.1% $334 28% 97.1%
Mid-Water
floaters $268 40% 100.0% $478 35% 99.9% $263 25% 97.7%
Jack-ups $75 29% 99.9% -- -- -- $118 18% 100.0%
Fleet Total 94.3% 93.5% 98.2%
(1) 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.
(2) 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). Our current fleet includes four ultra-
deepwater, three deepwater and three mid-water semisubmersible rigs that are cold stacked.
(3) 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.
Contact:
Samir Ali
Sr. Director, Investor Relations & Corporate Development
(281) 647-4035
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SOURCE Diamond Offshore Drilling, Inc.
