HOUSTON, Feb. 10, 2020 /PRNewswire/ -- Diamond
Offshore Drilling, Inc. (NYSE: DO) today reported the following
results for the fourth quarter of 2019:
|
Three Months
Ended
|
Thousands of
dollars, except per share data
|
December 31,
2019
|
|
September 30,
2019
|
Total
revenues
|
$
276,376
|
|
$
254,020
|
Operating
loss
|
(48,869)
|
|
(72,834)
|
Adjusted operating
loss
|
(48,869)
|
|
(70,291)
|
Net loss
|
(74,770)
|
|
(95,128)
|
Adjusted net
loss
|
(62,706)
|
|
(92,803)
|
Loss per diluted
share
|
$
(0.54)
|
|
$
(0.69)
|
Adjusted loss per
diluted share
|
$
(0.45)
|
|
$
(0.67)
|
During 2019, the Company secured $620
million of backlog, including over $50 million secured in the fourth quarter related
to a 12-month extension for the Ocean Patriot in the North
Sea. As of January 1, 2020, the
Company's total contracted backlog was $1.6
billion, excluding approximately a $100 million margin commitment from one of the
Company's customers.
CONFERENCE CALL
A conference call to discuss Diamond Offshore's earnings results
has been scheduled for 8:00 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
844-492-6043 or 478-219-0839 for international callers. The
conference ID number is 5959776. 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
innovation, thought leadership and contract drilling services to
solve complex deepwater challenges 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 certain 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, depressed levels 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, litigation and disputes, changes in
tax laws and rates, regulatory initiatives and compliance with
governmental regulations, 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
|
|
Twelve Months
Ended
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Contract
drilling
|
$
258,650
|
|
$
242,315
|
|
$
226,003
|
|
$
934,934
|
|
$
1,059,973
|
Revenues related to
reimbursable expenses
|
17,726
|
|
11,705
|
|
6,519
|
|
45,710
|
|
23,242
|
Total
revenues
|
276,376
|
|
254,020
|
|
232,522
|
|
980,644
|
|
1,083,215
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Contract drilling,
excluding depreciation
|
199,633
|
|
201,568
|
|
160,368
|
|
793,412
|
|
722,834
|
Reimbursable
expenses
|
17,537
|
|
11,423
|
|
6,459
|
|
45,016
|
|
22,917
|
Depreciation
|
91,752
|
|
88,693
|
|
86,255
|
|
355,596
|
|
331,789
|
General and
administrative
|
16,442
|
|
18,830
|
|
15,294
|
|
67,878
|
|
85,351
|
Impairment of
assets
|
-
|
|
-
|
|
-
|
|
-
|
|
27,225
|
Restucturing and
separation costs
|
-
|
|
-
|
|
116
|
|
-
|
|
5,041
|
(Gain) loss on
disposition of assets
|
(119)
|
|
6,340
|
|
1,307
|
|
1,072
|
|
241
|
Total operating
expenses
|
325,245
|
|
326,854
|
|
269,799
|
|
1,262,974
|
|
1,195,398
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
(48,869)
|
|
(72,834)
|
|
(37,277)
|
|
(282,330)
|
|
(112,183)
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
Interest
income
|
718
|
|
1,317
|
|
2,476
|
|
6,382
|
|
8,477
|
Interest expense, net
of amounts capitalized
|
(30,650)
|
|
(31,098)
|
|
(31,044)
|
|
(122,832)
|
|
(123,240)
|
Foreign currency
transaction loss
|
(2,053)
|
|
(77)
|
|
(494)
|
|
(3,936)
|
|
(379)
|
Other,
net
|
182
|
|
82
|
|
36
|
|
702
|
|
700
|
|
|
|
|
|
|
|
|
|
|
Loss before income
tax (expense) benefit
|
(80,672)
|
|
(102,610)
|
|
(66,303)
|
|
(402,014)
|
|
(226,625)
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
(expense)
|
5,902
|
|
7,482
|
|
(12,904)
|
|
44,800
|
|
46,353
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
$
(74,770)
|
|
$
(95,128)
|
|
$
(79,207)
|
|
$
(357,214)
|
|
$
(180,272)
|
|
|
|
|
|
|
|
|
|
|
Loss per
share
|
$
(0.54)
|
|
$
(0.69)
|
|
$
(0.58)
|
|
$
(2.60)
|
|
$
(1.31)
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
Shares of common
stock
|
137,698
|
|
137,694
|
|
137,436
|
|
137,652
|
|
137,399
|
Dilutive potential
shares of common stock
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
weighted-average shares outstanding
|
137,698
|
|
137,694
|
|
137,436
|
|
137,652
|
|
137,399
|
DIAMOND OFFSHORE
DRILLING, INC. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
December 31,
|
|
2019
|
|
2018
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
156,281
|
|
$
154,073
|
Marketable
securities
|
-
|
|
299,849
|
Accounts receivable,
net of allowance for bad debts
|
250,856
|
|
168,620
|
Prepaid expenses and
other current assets
|
68,658
|
|
163,396
|
Asset held for
sale
|
1,000
|
|
-
|
Total current
assets
|
476,795
|
|
785,938
|
|
|
|
|
Drilling and other
property and equipment, net of accumulated
|
|
|
|
depreciation
|
5,152,828
|
5,184,222
|
Other
assets
|
204,421
|
|
65,534
|
Total
assets
|
$
5,834,044
|
|
$
6,035,694
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Other current
liabilities
|
$
302,594
|
|
$
236,846
|
Long-term
debt
|
1,975,741
|
|
1,973,922
|
Deferred tax
liability
|
47,528
|
|
104,380
|
Other
liabilities
|
275,971
|
|
135,893
|
Stockholders'
equity
|
3,232,210
|
|
3,584,653
|
Total liabilities and
stockholders' equity
|
$
5,834,044
|
|
$
6,035,694
|
DIAMOND OFFSHORE
DRILLING, INC. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
Years
Ended
|
|
December
31,
|
|
2019
|
|
2018
|
Operating
activities:
|
|
|
|
Net loss
|
$
(357,214)
|
|
$
(180,272)
|
Adjustments to
reconcile net loss to net cash
|
|
|
|
provided by operating
activities
|
|
|
|
Depreciation
|
355,596
|
|
331,789
|
Loss on impairment of
assets
|
-
|
|
27,225
|
Deferred tax
provision
|
(56,908)
|
|
(75,993)
|
Stock-based
compensation expense
|
6,208
|
|
6,749
|
Contract liabilities,
net
|
27,578
|
|
183
|
Deferred contract
costs, net
|
59,141
|
|
22,765
|
Other
|
15,812
|
|
(7,466)
|
Net changes in
operating working capital
|
(41,124)
|
107,078
|
Net cash provided by
operating activities
|
9,089
|
|
232,058
|
|
|
|
|
Investing
activities:
|
|
|
|
Capital
expenditures
|
(326,090)
|
|
(222,406)
|
Proceeds from
disposition of assets, net of disposal
costs
|
16,217
|
|
70,067
|
Proceeds from
maturities of marketable securities
|
2,300,000
|
|
1,600,000
|
Purchase of
marketable securities
|
(1,996,996)
|
|
(1,895,997)
|
Net cash used in
investing activities
|
(6,869)
|
|
(448,336)
|
|
|
|
|
Financing
activities:
|
|
|
|
Other
|
(12)
|
|
(5,686)
|
Net cash used in
financing activities
|
(12)
|
|
(5,686)
|
|
|
|
|
Net change in cash
and cash equivalents
|
2,208
|
|
(221,964)
|
Cash and cash
equivalents, beginning of period
|
154,073
|
|
376,037
|
Cash and cash
equivalents, end of period
|
$
156,281
|
|
$
154,073
|
DIAMOND OFFSHORE
DRILLING, INC. AND SUBSIDIARIES
|
AVERAGE DAYRATE,
UTILIZATION AND OPERATIONAL EFFICIENCY
|
(Dayrate in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
FLEET
|
|
Fourth
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
2019
|
2019
|
2018
|
|
Average
Dayrate
(1)
|
Utilization
(2)
|
Operational
Efficiency
(3)
|
Average
Dayrate
(1)
|
Utilization
(2)
|
Operational
Efficiency
(3)
|
Average
Dayrate
(1)
|
Utilization
(2)
|
Operational
Efficiency
(3)
|
|
|
|
|
|
|
|
|
|
|
|
$264
|
59%
|
94.7%
|
$253
|
65%
|
96.6%
|
$315
|
46%
|
95.4%
|
(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). Our current fleet
includes two floaters 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,
non-revenue earning equipment downtime.
|
Non-GAAP Financial Measures (Unaudited)
To supplement the Company's unaudited condensed consolidated
financial statements presented on a GAAP basis, this press release
provides investors with adjusted operating loss, adjusted net loss
and adjusted loss per diluted share, which are non-GAAP financial
measures. Management believes that these measures provide
meaningful information about the Company's performance by excluding
certain items that may not be indicative of the Company's ongoing
operating results. This allows investors and others to better
compare the company's financial results across previous and
subsequent accounting periods and to those of peer companies and to
better understand the long-term performance of the Company.
Non-GAAP financial measures should be considered to be a supplement
to, and not as a substitute for, or superior to, financial measures
prepared in accordance with GAAP.
In order to fully assess the financial operating results of the
Company, management believes that the results of operations
adjusted to exclude various items and their related tax effects are
appropriate measures of the continuing and normal operations of the
Company. The amounts excluded from our adjusted results include the
loss on sale of mooring equipment recognized during the third
quarter of 2019 in relation to a new leasing initiative and other
discrete tax items recognized in the fourth quarter of 2019.
However, these measures should be considered in addition to, and
not as a substitute for, or superior to, contract drilling revenue,
contract drilling expense, operating income or loss, cash flows
from operations or other measures of financial performance prepared
in accordance with GAAP.
|
|
Three Months
Ended
|
|
|
December
31,
|
|
September
30,
|
|
|
2019
|
|
2019
|
Reconciliation of
As Reported Operating Loss to Adjusted
Operating Loss:
|
|
|
|
(In
thousands)
|
|
|
|
|
|
As reported
operating loss
|
$
(48,869)
|
|
$
(72,834)
|
|
|
|
|
|
Adjustments:
|
|
|
|
Loss on sale of
mooring equipment
|
-
|
|
2,543
|
|
|
|
|
|
Adjusted operating
loss
|
$
(48,869)
|
|
$
(70,291)
|
|
|
|
|
|
Reconciliation of
As Reported Net Loss to Adjusted Net Loss:
|
|
|
|
(In
thousands)
|
|
|
|
|
|
As reported net
loss
|
$
(74,770)
|
|
$
(95,128)
|
|
|
|
|
|
Adjustments:
|
|
|
|
Loss on sale of
mooring equipment
|
-
|
|
2,543
|
|
|
|
|
|
Tax effect of
adjustments:
|
|
|
|
Loss on sale of
mooring equipment
|
-
|
|
(218)
|
Other discrete
items
|
12,064
|
|
-
|
|
|
|
|
|
Adjusted net
loss
|
$
(62,706)
|
|
$
(92,803)
|
|
|
Three Months
Ended
|
|
|
December
31,
|
|
September
30,
|
|
|
2019
|
|
2019
|
Reconciliation of
As Reported Loss per Diluted Share to
Adjusted Loss per Diluted Share:
|
|
|
|
|
|
As reported loss
per diluted share
|
$
(0.54)
|
|
$
(0.69)
|
|
|
|
|
|
Adjustments:
|
|
|
|
Loss on sale of
mooring equipment
|
-
|
|
0.02
|
|
|
|
|
|
Tax effect of
adjustments:
|
|
|
|
Loss on sale of
mooring equipment
|
-
|
|
-
|
Other discrete
items
|
0.09
|
|
-
|
|
|
|
|
|
Adjusted loss per
diluted share
|
$
(0.45)
|
|
$
(0.67)
|
Contact:
Samir Ali
Vice President, Investor Relations & Corporate Development
(281) 647-4035
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SOURCE Diamond Offshore Drilling, Inc.