HOUSTON--(BUSINESS WIRE)--Diamond Offshore Drilling, Inc. (NYSE: DO) today reported net income for the first quarter of 2013 of $176 million, or $1.27 per share on a diluted basis, compared with net income of $185 million, or $1.33 per share on a diluted basis, in the same period a year earlier. Revenues in the first quarter of 2013 were $730 million, compared with revenues of $769 million in the prior-year quarter. Results for the prior-year quarter included the sale of the jack-up rig Ocean Columbia, which yielded an after-tax gain of approximately $16 million, or $0.12 per share.
“We are pleased with the first-quarter results, which reflect our ongoing success at containing operating expenses,” said Larry Dickerson, President and Chief Executive Officer of Diamond Offshore.
“We have recently signed a new commitment for the Ocean Saratoga in Nicaragua at a rate of $320,000 per day, which we believe highlights the continuing demand for our mid-water semisubmersibles,” said Dickerson. “Along with our previously announced contract for the Ocean Nomad in Latvia, this commitment demonstrates how new markets can generate additional demand for this segment of our fleet.”
“Additionally, we are proud that Diamond Offshore was recently recognized by EnergyPoint Research in its 2012 customer satisfaction survey as No. 1 in two important categories: Deepwater Drilling and Latin America & Mexico.”
CONFERENCE CALL
A conference call to discuss Diamond Offshore’s first-quarter results has been scheduled for 9:00 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 800-247-9979 or 973-321-1100, for international callers. The conference ID number is 32776586. 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
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 operating costs and expenses and future operations. 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.
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DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES |
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CONSOLIDATED STATEMENTS OF OPERATIONS |
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| (Unaudited) | |||||||||||
| (In thousands, except per share data) | |||||||||||
| Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2013 | 2012 | ||||||||||
| Revenues: | |||||||||||
| Contract drilling | $ | 699,973 | $ | 755,155 | |||||||
| Revenues related to reimbursable expenses | 29,768 | 13,487 | |||||||||
| Total revenues | 729,741 | 768,642 | |||||||||
| Operating expenses: | |||||||||||
| Contract drilling, excluding depreciation | 375,094 | 397,102 | |||||||||
| Reimbursable expenses | 29,289 | 13,151 | |||||||||
| Depreciation | 96,821 | 101,393 | |||||||||
| General and administrative | 16,815 | 17,586 | |||||||||
| Bad debt recovery | -- | (618 | ) | ||||||||
| Gain on disposition of assets | (2,004 | ) | (25,382 | ) | |||||||
| Total operating expenses | 516,015 | 503,232 | |||||||||
| Operating income | 213,726 | 265,410 | |||||||||
| Other income (expense): | |||||||||||
| Interest income | 617 | 1,783 | |||||||||
| Interest expense | (8,069 | ) | (15,329 | ) | |||||||
| Foreign currency transaction gain (loss) | 159 | (104 | ) | ||||||||
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Other, net |
(254 | ) | (325 | ) | |||||||
| Income before income tax expense | 206,179 | 251,435 | |||||||||
| Income tax expense | (30,190 | ) | (66,266 | ) | |||||||
| Net income | $ | 175,989 | $ | 185,169 | |||||||
| Earnings per share: | |||||||||||
| Basic | $ | 1.27 | $ | 1.33 | |||||||
| Diluted | $ | 1.27 | $ | 1.33 | |||||||
| Weighted average shares outstanding: | |||||||||||
| Shares of common stock | 139,032 | 139,028 | |||||||||
| Dilutive potential shares of common stock | 49 | 12 | |||||||||
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Total weighted average shares outstanding |
139,081 | 139,040 | |||||||||
| DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES | ||||||||||||||||
| RESULTS OF OPERATIONS | ||||||||||||||||
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(Unaudited) |
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(In thousands) |
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Three Months Ended | |||||||||||||||
| Mar 31, | Dec 31, | Mar 31, | ||||||||||||||
| 2013 | 2012 | 2012 | ||||||||||||||
| REVENUES | ||||||||||||||||
| Floaters: | ||||||||||||||||
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Ultra-Deepwater |
$ | 191,357 | $ | 229,560 | $ | 244,589 | ||||||||||
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Deepwater |
164,420 | 145,310 | 146,003 | |||||||||||||
| Mid-water | 305,221 | 326,520 | 318,595 | |||||||||||||
| Total Floaters | 660,998 | 701,390 | 709,187 | |||||||||||||
| Jack-ups | 38,975 | 39,233 | 45,968 | |||||||||||||
| Total Contract Drilling Revenue | $ | 699,973 | $ | 740,623 | $ | 755,155 | ||||||||||
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Revenues Related to Reimbursable Expenses |
$ |
29,768 |
$ |
9,914 |
$ |
13,487 |
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| CONTRACT DRILLING EXPENSE | ||||||||||||||||
| Floaters: | ||||||||||||||||
| Ultra-Deepwater | $ | 135,776 | $ | 135,837 | $ | 139,961 | ||||||||||
| Deepwater | 56,436 | 67,772 | 58,594 | |||||||||||||
| Mid-water | 143,647 | 143,124 | 162,779 | |||||||||||||
| Total Floaters | 335,859 | 346,733 | 361,334 | |||||||||||||
| Jack-ups | 29,667 | 21,582 | 31,443 | |||||||||||||
| Other | 9,568 | 9,274 | 4,325 | |||||||||||||
| Total Contract Drilling Expense | $ | 375,094 | $ | 377,589 | $ | 397,102 | ||||||||||
| Reimbursable Expenses | $ | 29,289 | $ | 9,427 | $ | 13,151 | ||||||||||
| OPERATING INCOME | ||||||||||||||||
| Floaters: | ||||||||||||||||
| Ultra-Deepwater | $ | 55,581 | $ | 93,723 | $ | 104,628 | ||||||||||
| Deepwater | 107,984 | 77,538 | 87,409 | |||||||||||||
| Mid-water | 161,574 | 183,396 | 155,816 | |||||||||||||
| Total Floaters | 325,139 | 354,657 | 347,853 | |||||||||||||
| Jack-ups | 9,308 | 17,651 | 14,525 | |||||||||||||
| Other | (9,568 | ) | (9,274 | ) | (4,325 | ) | ||||||||||
| Reimbursable expenses, net | 479 | 487 | 336 | |||||||||||||
| Depreciation | (96,821 | ) | (92,844 | ) | (101,393 | ) | ||||||||||
| General and administrative expense | (16,815 | ) | (14,837 | ) | (17,586 | ) | ||||||||||
| Impairment of assets | -- | (62,437 | ) | -- | ||||||||||||
| Bad debt recovery | -- | -- | 618 | |||||||||||||
| Gain on disposition of assets | 2,004 | 1,559 | 25,382 | |||||||||||||
| Total Operating Income | $ | 213,726 | $ | 194,962 | $ | 265,410 | ||||||||||
| DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES | |||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
| (In thousands) | |||||||||
| March 31, | December 31, | ||||||||
| 2013 | 2012 | ||||||||
| (unaudited) | |||||||||
| ASSETS | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 308,109 | $ | 335,432 | |||||
| Marketable securities | 1,150,168 | 1,150,158 | |||||||
| Accounts receivable, net of allowance for bad debts | 485,900 | 499,660 | |||||||
| Prepaid expenses and other current assets | 117,804 | 136,099 | |||||||
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Assets held for sale |
11,594 | 11,594 | |||||||
| Total current assets | 2,073,575 | 2,132,943 | |||||||
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Drilling and other property and equipment, net of accumulated depreciation |
4,967,242 | 4,864,972 | |||||||
| Other assets | 226,042 | 237,371 | |||||||
| Total assets | $ | 7,266,859 |
$ |
7,235,286 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
| Current liabilities | $ | 458,132 | $ | 485,546 | |||||
| Long-term debt | 1,496,128 | 1,496,066 | |||||||
| Deferred tax liability | 500,292 | 490,946 | |||||||
| Other liabilities | 182,855 | 186,334 | |||||||
| Stockholders’ equity | 4,629,452 | 4,576,394 | |||||||
| Total liabilities and stockholders’ equity | $ | 7,266,859 | $ | 7,235,286 | |||||
| DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES | ||||||||||||||||||||
| AVERAGE DAYRATES AND UTILIZATION | ||||||||||||||||||||
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(Dayrate in thousands) |
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| First Quarter | Fourth Quarter | First Quarter | ||||||||||||||||||
| 2013 | 2012 | 2012 | ||||||||||||||||||
| Dayrate | Utilization | Dayrate | Utilization | Dayrate | Utilization | |||||||||||||||
| Ultra-Deepwater Floaters | $360 | 73% | $348 | 89% | $364 | 85% | ||||||||||||||
| Deepwater Floaters | $389 | 94% | $372 | 85% | $359 | 88% | ||||||||||||||
| Mid-Water Floaters | $262 | 64% | $268 | 70% | $266 | 65% | ||||||||||||||
| Jack-Ups | $85 | 71% | $85 | 71% | $87 | 44% | ||||||||||||||