Transocean's Profit Drops, but Results Top Expectations
August 03 2016 - 6:30PM
Dow Jones News
Oil driller Transocean Ltd.'s second-quarter profit dropped
sharply as revenue was nearly halved.
Still, results beat expectations, enabling its beaten-down stock
to gain 2%, to $10.70, in after-hours trading.
On Monday, the Switzerland-based company said it intended to buy
back the master limited partnership it had formed in 2014 to boost
its financial structure, allowing it to shift some of its rigs and
other assets to the partnership and lower taxes, and mollify
friction with billionaire investor Carl Icahn.
Transocean Partners' shares, up 40% this year, edged up in
after-hours trading to $12.35.
One of the world's largest offshore drillers, Transocean has
been pummeled by an oil rut that has upended the sector, pressing
results for most and crushing others.
Transocean, which boasts the world's largest fleet of offshore
drilling rigs, spent billions of dollars to expand its fleet right
before oil prices collapsed.
In the latest period, expenses were $767 million, down 17% from
the previous quarter, while the rig utilization fell to 47%, from
51% in the previous quarter and 75% in the year-ago period.
Contract backlog, meanwhile, fell to $13.7 billion as of the
July fleet status report, from $14.6 billion in April.
Over all, Transocean reported a profit of $77 million, or 21
cents a share, compared with $342 million, or 93 cents a share, a
year earlier. Excluding impairment charges and other items, profit
was 17 cents a share, down from $1.11 a share a year earlier.
Revenue dropped to $943 million from $1.88 billion a year
earlier.
Analysts surveyed by Thomson Reuters had projected Transocean
would break even on an adjusted basis, with revenue falling to
$919.8 million.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
August 03, 2016 18:15 ET (22:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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