Patterson-UTI Energy, Inc.
), one of the largest onshore contract drillers in the U.S.,
reported better-than-expected second quarter 2012 results. The
outperformance was driven by robust drilling operations.
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Earnings per share (excluding gain on sale of assets) came in at 49
cents, ahead of the Zacks Consensus Estimate of 44 cents. Revenues
of $681.1 million were also above our projection of $664.0 million.
Comparing year over year, Patterson-UTI's adjusted earnings per
share decreased by 5.8% (from 52 cents to 49 cents), though revenue
was up 13.5%. The profit decline from the prior-year results
reflects difficult market conditions.
Rig Count Statistics
The number of operational rigs during the quarter averaged 224 (all
located in the U.S.) compared with 202 average rigs operational in
the second quarter of 2011 and 237 rigs in the first quarter of
Revenue totaled $460.2 million (67.6% of the total), up
approximately 19.1% year over year. Average revenue per operating
day was $22,570, up 7.5% year over year, while average direct costs
per operating day increased 12.5% year over year to $13,370.
Additionally, the average number of rigs operating jumped from 202
in the year-ago quarter to 224, driving the segment operating
profit to $90.5 million from $85.1 million in the year-ago quarter.
Revenue of $206.2 million was up 3.0% year over year. However, with
market conditions remaining challenging, the segment's operating
profit of $36.8 million decreased from $50.3 million in the
Oil & Natural Gas:
Revenue stood at $14.7 million, up 9.2% from the year-ago quarter.
Operating income of $7.2 million was slightly up from $7.1 million
earned in the prior-year quarter.
Capital Expenditure & Balance Sheet
During the quarter, Patterson-UTI spent approximately $248.7
million on capital programs (as against $245.1 million in the
second quarter of 2011), of which approximately 73.1% was allocated
toward the Contract Drilling segment. As of June 30, 2012, the
company had $75.3 million in cash and $600.0 million in long-term
The company repurchased more than 3% of its outstanding shares
(approximately 4.7 million shares) for $70 million during the
Patterson-UTI Energy, Inc. is one of the largest onshore contract
drillers in the U.S. with approximately 330 land-based rigs that
operate primarily in the oil and natural gas producing regions of
North America. The company was incepted following a merger between
Patterson Energy, Inc. and UTI Energy Corporation.
Patterson-UTI, the second-largest North American land drilling
Nabors Industries Ltd
), currently carries a Zacks #3 Rank, which implies a short-term
Hold rating on the stock.