Contract drilling services provider
Helmerich & Payne Inc.
(
HP
) reported bright results for the fourth quarter of fiscal 2012
(three months ended September 30, 2012), owing to better drilling
activities and innovative technological applications.
Quarterly earnings per share from continuing operations
(excluding special items) came in at $1.36, beating the Zacks
Consensus Estimate of $1.24. Compared with the year-ago adjusted
profit, the result increased 22.5% from $1.11.
Revenue in the quarter was $829.5 million, higher 18.4% from the
fourth quarter of 2011 and also surpassed our projection of
$817.0 million.
For fiscal year 2012, Helmerich & Payne generated earnings
per share from continuing operations (excluding special items) of
$5.16 (surpassing our projection of $5.03), on revenue of
$3,151.8 million.
Segment Performance
U.S. Land Operations:
During the quarter, operating revenues totaled $695.1 million
(84% of total revenue), up 18.0% year over year. Average rig
revenue per operating day was $28,325, up 6.7%, while average rig
margin per day increased 15.4% to $15,705.
Utilization levels dropped to 85% (from 87% in the fourth quarter
of fiscal 2011). The segment operating income improved
significantly (by 23.2%) from the year-earlier quarter to $236.6
million.
Offshore Operations:
Helmerich & Payne's offshore revenues were up 3.7% year over
year to $53.3 million. Daily average rig revenue increased 14.5%
to $62,018, while average rig margin per day climbed 7.1% to
$23,330. This aided the segment's operating income to rise 1.4%
from the prior-year quarter to $12.0 million. Quarterly rig
utilization was 84%, down from 85% recorded a year ago.
International Land Operations:
International land operations recorded revenues of $77.7 million,
up from $57.2 million in the prior-year quarter. Average daily
rig revenue was $35,732, up 19.1%, while rig margin per day was
$8,210, against $7,690 recorded in the year-ago period. With
better activity, the segment generated operating profit of $7.1
million, compared with $3.5 million in the fourth quarter of
fiscal 2011. Utilization level was 79%, up from 74% in the
corresponding period, last year.
Capital Expenditure & Balance Sheet
During the fiscal year 2012, Helmerich & Payne spent $1,097.7
million on capital programs. As of September 30, 2012, the
company had approximately $96.1 million in cash, while long-term
debt stood at $195.0 million (debt-to-capitalization ratio of
4.8%).
Recommendation
Barbados-based
Nabors Industries Ltd.
(
NBR
) - the leading land-drilling contractor in the world - reported
mixed third-quarter 2012 results, with earnings per share going
ahead of the Zacks Consensus Estimate and revenue missing our
projection.
Helmerich & Payne currently retains a Zacks #3 Rank
(short-term Hold rating). Longer term, we are maintaining our
Neutral recommendation on the stock.
HELMERICH&PAYNE (HP): Free Stock Analysis
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NABORS IND (NBR): Free Stock Analysis Report
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