Diamond Offshore Drilling Inc.
) posted second-quarter 2014 earnings of 66 cents per share,
surpassing the Zacks Consensus Estimate of 59 cents. The
performance was primarily attributable to higher dayrates. However,
the reported figure decreased 50.4% from the year-earlier quarter
earnings of $1.33 per share.
Diamond Offshore Drilling Inc - Earnings
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Total revenue in the quarter decreased 8.7% year over year to
$692.2 million and lagged the Zacks Consensus Estimate of $695.0
Diamond Offshore declared a special dividend of 75 cents per share
in the quarter, unchanged from the prior quarter. The company will
also pay its regular quarterly dividend of 12.5 cents per share (50
cents per share annualized). Both dividends are payable on Sep 2,
2014 to shareholders of record on Aug 6.
In the second quarter, revenues from the Contract Drilling segment
fell 12.8% year over year to $649.6 million, mainly due to a 5.4%
decrease in total floaters revenue. These floaters accounted for
93% of the total contract drilling revenue, while jackups
Ultra-Deepwater floaters recorded an average dayrate of $403,000,
up from $342,000 in the year-earlier quarter. Deepwater floaters
realized an average dayrate of $418,000, up from $409,000 in the
year-ago quarter. Mid-water floaters recorded an average dayrate of
$266,000 versus $271,000 in the year-earlier quarter. Jackup rigs'
dayrates averaged $97,000, up from $88,000 in the second quarter of
Rig utilization for Ultra-Deepwater floaters decreased to 51% from
92% in the year-ago quarter. Utilization of Deepwater floaters
decreased to 51% from 99% in the year-ago quarter. Mid-water
category rig utilization was 68%, up from 65% in the comparable
quarter last year while jackup rig utilization was 74%, unchanged
from the prior-year quarter.
As of Jun 30, 2014, Diamond Offshore had approximately $980.8
million in cash and cash equivalents, while long-term debt was
$2,244.3 million. Debt-to-capitalization ratio at the end of the
quarter was 33% (up from about 32.9% in the preceding quarter).
Diamond Offshore currently carries a Zacks Rank #5 (Sell). However,
better-ranked stocks in the oil and gas industry like
Magellan Midstream Partners LP
Exco Resources Inc
), appear promising and are worth consideration. All these stocks
sport a Zacks Rank #1 (Strong Buy).
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