) reported fourth-quarter 2012 earnings of 76 cents per share,
beating the Zacks Consensus Estimate by 2 cents. The quarterly
earnings also increased 8.6% from the year-ago profit level of 70
cents. The outperformance was mainly backed by growth in product
and service revenues as demand for offshore equipment climbed.
The company registered total revenue of $188.5 million in the
quarter, up 9.8% from the year-ago level of $171.6 million. The
reported figure, however, was almost at par with the Zacks
Consensus Estimate of $189.0 million.
Operating income expanded almost 13% to $41.6 million from the
year-earlier level of $36.8 million. On the cost front, on an
annualized basis, selling, general and administrative expenses
rose 31.6% to $23.6 million from the year-earlier level of $17.9
million, while its engineering and product development costs
decreased nearly 1%. Notably, depreciation and amortization
expenses increased 12.8% to $6.8 million.
As of Dec 30, 2012, the company had a backlog of $881.0 million,
compared with $716 million in the prior-year period.
Capital expenditures in the quarter were $10.2 million, compared
with $11.1 million in the year-earlier quarter.
For the first quarter of 2013, the offshore drilling equipment
maker expects earnings between 73 cents and 83 cents per diluted
share, excluding any unusual or special charges. Additionally,
based on improving market conditions, Dril-Quip expects its
full-year 2013 adjusted earnings per share expectation to range
The company remains upbeat on the four-year contract with
Brazil's state-run energy giant
Petroleo Brasileiro S.A.
, or Petrobras (
) regarding the supply of subsea wellhead systems as well as
tools for drilling deepwater wells offshore Brazil. The company
is well positioned to take advantage of the project. Thus, the
company through 2013 and beyond is geared for general secular
growth backed by Petrobras' planned newbuild program.
Dril-Quip holds a Zacks Rank #4, which is equivalent to a Sell
rating for a period of 1 to 3 months. However, there are other
stocks in the oil and gas sector -
Range Resources Corporation
NGL Energy Partners LP
) - which hold a Zacks Rank #1 (Strong Buy) and are expected to
DRIL-QUIP INC (DRQ): Free Stock Analysis
NGL ENERGY PART (NGL): Free Stock Analysis
PETROBRAS-ADR C (PBR): Free Stock Analysis
RANGE RESOURCES (RRC): Free Stock Analysis
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