HOUSTON--(BUSINESS WIRE)--
Diamond Offshore Drilling, Inc. (NYSE: DO) today reported net
income for the fourth quarter of 2012 of $156 million, or $1.12 per
share on a diluted basis, compared with net income of $188 million, or
$1.36 per share on a diluted basis, in the same period a year earlier.
Revenues in the fourth quarter of 2012 were $751 million, compared with
revenues of $748 million in the prior-year quarter.
During the fourth quarter, the Company reclassified its four
cold-stacked rigs as held for sale and recognized an after-tax
impairment charge of $40.6 million, or $0.29 per share. These units are
the semisubmersible rigs Ocean Epoch, Ocean New Era and Ocean
Whittington and the jack-up rig Ocean Spartan.
The effective tax rate for the quarter was 15.9 percent, compared with
7.4 percent in the fourth quarter of 2011. Lower tax expense in the
prior-year quarter was driven by a reduction of the Company’s liability
for uncertain tax positions. The full-year 2012 effective tax rate was
21.5 percent versus the prior-year effective tax rate of 18.4 percent.
For the full-year 2012, the Company reported net income of $720 million,
or $5.18 per share on a diluted basis, compared with net income of $963
million, or $6.92 per share on a diluted basis, in 2011. Revenues for
the full-year 2012 were $2.987 billion, compared with $3.322 billion in
2011.
“Our results for the fourth quarter and full year reflect our continuing
efforts to manage operating costs across the fleet,” said Larry
Dickerson, President and Chief Executive Officer of Diamond Offshore.
“While there is some cost inflation pressure in our industry, we remain
focused on controlling and reducing expenses.”
The Company announced that the Ocean Patriot was awarded a
three-year contract in the North Sea at a rate of $400,500 per day,
which is expected to generate maximum total revenue of approximately
$439 million. After completing its current contracts in Southeast Asia,
the rig will undergo required North Sea enhancements at a total
estimated cost of approximately $120 million. Following these upgrades
and subsequent mobilization to the North Sea, the rig is expected to
commence work early in the second quarter of 2014.
“The opportunity to upgrade the Ocean Patriot to work for our
customer Shell in the North Sea demonstrates the ongoing strength in
that market,” said Larry Dickerson. “This project is consistent with
Diamond Offshore’s long-term strategy of investing in our fleet at
attractive capital costs.”
Capital expenditures for the six rigs currently under construction
totaled $499 million in full-year 2012, excluding capitalized interest.
To complete these projects, the Company estimates that remaining capital
expenditures, excluding capitalized interest, will be $1.3 billion in
2013 and $1.1 billion in 2014.
CONFERENCE CALL
Diamond Offshore will host a conference call to discuss fourth quarter
results on Tuesday, February 5, 2013 beginning at 9:00 a.m. CST. 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 86787795. An online replay will also be
available on www.diamondoffshore.com
following the call.
ABOUT DIAMOND OFFSHORE
Diamond Offshore provides contract drilling services to the energy
industry and is a leader in deepwater drilling. Diamond Offshore’s fleet
of offshore drilling rigs consists of 30 semisubmersibles, seven
jack-ups and one drillship, in addition to four ultra-deepwater
drillships and two deepwater semisubmersibles currently under
construction. For additional information and access to SEC filings,
please visit the Company’s website at www.diamondoffshore.com.
Diamond Offshore is a 50.4% owned subsidiary of Loews Corporation (NYSE:
L).
FORWARD-LOOKING STATEMENTS
Maximum contract revenue as stated above assumes 100% rig utilization.
Generally, rig utilization rates approach 92-98% during contracted
periods; however, utilization rates can be adversely impacted by
additional downtime due to unscheduled repairs, maintenance and weather.
Additional information on Diamond Offshore Drilling, Inc. (“the
Company”) and access to the Company’s SEC filings is available on the
Internet at www.diamondoffshore.com.
Statements contained in this press release 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 future revenues and backlog, future performance
under contract awards and extensions, future operating costs and
expenses, future operations and dayrates, future financial condition,
market outlook and future market conditions, future rig construction and
upgrades and expected expenditures therefor, and future contracting
opportunities. 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 factors include, among others, general economic and business
conditions, contract cancellations, customer bankruptcy, operating
risks, casualty losses, industry fleet capacity, changes in foreign and
domestic oil and gas exploration and production activity, competition,
changes in foreign, political, social and economic conditions,
regulatory initiatives and compliance with governmental regulations,
customer preferences and various other matters, 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
(Unaudited)
(In thousands, except per share data)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2012
2011
2012
2011
Revenues:
Contract drilling
$
740,623
$
734,283
$
2,936,066
$
3,254,313
Revenues related to reimbursable expenses
9,914
14,074
50,442
68,106
Total revenues
750,537
748,357
2,986,508
3,322,419
Operating expenses:
Contract drilling, excluding depreciation
377,589
406,763
1,537,224
1,548,502
Reimbursable expenses
9,427
13,609
48,778
66,052
Depreciation
92,844
95,089
392,913
398,612
General and administrative
14,837
16,334
64,640
65,310
Impairment of assets
62,437
--
62,437
--
Bad debt recovery
--
(1,300
)
(1,018
)
(6,713
)
Gain on disposition of assets
(1,559
)
(414
)
(80,844
)
(4,758
)
Total operating expenses
555,575
530,081
2,024,130
2,067,005
Operating income
194,962
218,276
962,378
1,255,414
Other income (expense):
Interest income
858
3,103
4,910
6,668
Interest expense
(9,436
)
(12,993
)
(46,216
)
(73,137
)
Foreign currency transaction gain (loss)
(1,118
)
(3,985
)
(1,999
)
(8,588
)
Other, net
(225
)
(854
)
(992
)
(1,086
)
Income before income tax expense
185,041
203,547
918,081
1,179,271
Income tax expense
(29,380
)
(15,057
)
(197,604
)
(216,729
)
Net Income
$
155,661
$
188,490
$
720,477
$
962,542
Income per share:
Basic
$
1.12
$
1.36
$
5.18
$
6.92
Diluted
$
1.12
$
1.36
$
5.18
$
6.92
Weighted average shares outstanding:
Shares of common stock
139,031
139,027
139,029
139,027
Dilutive potential shares of common stock
31
9
19
11
Total weighted average shares outstanding
139,062
139,036
139,048
139,038
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
(Unaudited)
(In thousands)
Three Months Ended
Dec 31,
Sep 30,
Dec 31,
2012
2012
2011
REVENUES
Floaters:
Ultra-Deepwater
$
229,560
$
195,574
$
189,148
Deepwater
145,310
163,816
190,615
Mid-water
326,520
319,491
312,256
Total Floaters
701,390
678,881
692,019
Jack-ups
39,233
35,146
42,264
Total Contract Drilling Revenue
$
740,623
$
714,027
$
734,283
Revenues Related to Reimbursable Expenses
$
9,914
$
15,114
$
14,074
CONTRACT DRILLING EXPENSE
Floaters:
Ultra-Deepwater
$
135,837
$
132,705
$
132,187
Deepwater
67,772
58,029
52,843
Mid-water
143,124
135,935
169,481
Total Floaters
346,733
326,669
354,511
Jack-ups
21,582
24,245
45,597
Other
9,274
6,367
6,655
Total Contract Drilling Expense
$
377,589
$
357,281
$
406,763
Reimbursable Expenses
$
9,427
$
14,563
$
13,609
OPERATING INCOME
Floaters:
Ultra-Deepwater
$
93,723
$
62,869
$
56,961
Deepwater
77,538
105,787
137,772
Mid-water
183,396
183,556
142,775
Total Floaters
354,657
352,212
337,508
Jack-ups
17,651
10,901
(3,333
)
Other
(9,274
)
(6,367
)
(6,655
)
Reimbursable expenses, net
487
551
465
Depreciation
(92,844
)
(99,207
)
(95,089
)
General and administrative expense
(14,837
)
(13,476
)
(16,334
)
Impairment of assets
(62,437
)
--
--
Bad debt recovery
--
--
1,300
Gain on disposition of assets
1,559
208
414
Total Operating Income
$
194,962
$
244,822
$
218,276
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
December 31,
2012
2011
ASSETS
Current assets:
Cash and cash equivalents
$
335,432
$
333,765
Marketable securities
1,150,158
902,414
Accounts receivable, net of allowance for bad debts
499,660
563,934
Prepaid expenses and other current assets
136,099
192,570
Assets held for sale
11,594
--
Total current assets
2,132,943
1,992,683
Drilling and other property and equipment, net of accumulated
depreciation
4,864,972
4,667,469
Other assets
237,371
304,005
Total assets
$
7,235,286
$
6,964,157
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
$
485,546
$
427,291
Long-term debt
1,496,066
1,495,823
Deferred tax liability
490,946
536,815
Other liabilities
186,334
171,165
Stockholders’ equity
4,576,394
4,333,063
Total liabilities and stockholders’ equity
$
7,235,286
$
6,964,157
DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
AVERAGE DAYRATES AND UTILIZATION
(Dayrate in thousands)
Fourth Quarter
Third Quarter
Fourth Quarter
2012
2012
2011
Dayrate
Utilization
Dayrate
Utilization
Dayrate
Utilization
Ultra-Deepwater Floaters
$348
89%
$354
75%
$356
70%
Deepwater Floaters
$372
85%
$373
95%
$422
97%
Mid-Water Floaters
$268
70%
$258
71%
$271
60%
Jack-Ups
$85
71%
$98
56%
$79
36%
Diamond Offshore Drilling, Inc. Darren Daugherty, 281-492-5370 Director,
Investor Relations
Press Release $DO Diamond Offshore Drilling, Inc.
HOUSTON--(BUSINESS WIRE)-- Diamond Offshore Drilling, Inc. (NYSE: DO) today reported net income for the fourth quarter of 2012 of $156 million, or $1.12 per share on a diluted basis, compared with net income of $188 million, or $1.36 per share on a diluted basis, in the same period a year earlier. Revenues in the fourth quarter of 2012 were $751 million, compared with revenues of $748 million in the prior-year quarter.
During the fourth quarter, the Company reclassified its four cold-stacked rigs as held for sale and recognized an after-tax impairment charge of $40.6 million, or $0.29 per share. These units are the semisubmersible rigs Ocean Epoch, Ocean New Era and Ocean Whittington and the jack-up rig Ocean Spartan.
The effective tax rate for the quarter was 15.9 percent, compared with 7.4 percent in the fourth quarter of 2011. Lower tax expense in the prior-year quarter was driven by a reduction of the Company’s liability for uncertain tax positions. The full-year 2012 effective tax rate was 21.5 percent versus the prior-year effective tax rate of 18.4 percent.
For the full-year 2012, the Company reported net income of $720 million, or $5.18 per share on a diluted basis, compared with net income of $963 million, or $6.92 per share on a diluted basis, in 2011. Revenues for the full-year 2012 were $2.987 billion, compared with $3.322 billion in 2011.
“Our results for the fourth quarter and full year reflect our continuing efforts to manage operating costs across the fleet,” said Larry Dickerson, President and Chief Executive Officer of Diamond Offshore. “While there is some cost inflation pressure in our industry, we remain focused on controlling and reducing expenses.”
The Company announced that the Ocean Patriot was awarded a three-year contract in the North Sea at a rate of $400,500 per day, which is expected to generate maximum total revenue of approximately $439 million. After completing its current contracts in Southeast Asia, the rig will undergo required North Sea enhancements at a total estimated cost of approximately $120 million. Following these upgrades and subsequent mobilization to the North Sea, the rig is expected to commence work early in the second quarter of 2014.
“The opportunity to upgrade the Ocean Patriot to work for our customer Shell in the North Sea demonstrates the ongoing strength in that market,” said Larry Dickerson. “This project is consistent with Diamond Offshore’s long-term strategy of investing in our fleet at attractive capital costs.”
Capital expenditures for the six rigs currently under construction totaled $499 million in full-year 2012, excluding capitalized interest. To complete these projects, the Company estimates that remaining capital expenditures, excluding capitalized interest, will be $1.3 billion in 2013 and $1.1 billion in 2014.
CONFERENCE CALL
Diamond Offshore will host a conference call to discuss fourth quarter results on Tuesday, February 5, 2013 beginning at 9:00 a.m. CST. 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 86787795. An online replay will also be available on www.diamondoffshore.com following the call.
ABOUT DIAMOND OFFSHORE
Diamond Offshore provides contract drilling services to the energy industry and is a leader in deepwater drilling. Diamond Offshore’s fleet of offshore drilling rigs consists of 30 semisubmersibles, seven jack-ups and one drillship, in addition to four ultra-deepwater drillships and two deepwater semisubmersibles currently under construction. For additional information and access to SEC filings, please visit the Company’s website at www.diamondoffshore.com. Diamond Offshore is a 50.4% owned subsidiary of Loews Corporation (NYSE: L).
FORWARD-LOOKING STATEMENTS
Maximum contract revenue as stated above assumes 100% rig utilization. Generally, rig utilization rates approach 92-98% during contracted periods; however, utilization rates can be adversely impacted by additional downtime due to unscheduled repairs, maintenance and weather. Additional information on Diamond Offshore Drilling, Inc. (“the Company”) and access to the Company’s SEC filings is available on the Internet at www.diamondoffshore.com.
Statements contained in this press release 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 future revenues and backlog, future performance under contract awards and extensions, future operating costs and expenses, future operations and dayrates, future financial condition, market outlook and future market conditions, future rig construction and upgrades and expected expenditures therefor, and future contracting opportunities. 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 factors include, among others, general economic and business conditions, contract cancellations, customer bankruptcy, operating risks, casualty losses, industry fleet capacity, changes in foreign and domestic oil and gas exploration and production activity, competition, changes in foreign, political, social and economic conditions, regulatory initiatives and compliance with governmental regulations, customer preferences and various other matters, 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.
(Unaudited)
(In thousands, except per share data)
Twelve Months Ended
December 31,
(Unaudited)
(In thousands)
Three Months Ended
$
9,914
$
15,114
$
14,074
Drilling and other property and equipment, net of accumulated depreciation
(Dayrate in thousands)
Diamond Offshore Drilling, Inc.
Darren Daugherty, 281-492-5370
Director, Investor Relations
Source: Diamond Offshore Drilling, Inc.