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Diamond Offshore Beats on Q4 Earnings, Cancels Dividend

Diamond Offshore Drilling Inc.DO reported fourth-quarter 2015 adjusted earnings of 89 cents per share that comfortably surpassed the Zacks Consensus Estimate of 53 cents. The bottom line also increased from the year-earlier earnings of 72 cents.

Diamond Offshore Drilling Inc. (DO) Street Actual & Estimate EPS - Last 5 Quarters | FindTheCompany

For full-year 2015, the company registered earnings of $3.05 per share, beating the Zacks Consensus Estimate of $2.70. Also, results came above the year-earlier earnings of $2.81.

Total revenue generated in the quarter was $555.6 million, lower than the year-ago figure of $675.3 million. However, the top line came in above the Zacks Consensus Estimate of $517.0 million.

For 2015, total revenue decreased to $2,419.4 million from $2,814.7 million in the prior year. However, total revenue came above the Zacks Consensus Estimate of $2,376.0 million.

Dividend Story

Diamond Offshore announced that it has discontinued its quarterly cash dividend of 12.5 cents per share, which will lead to savings of $69 million on an annual basis.

Operational Performance

In the fourth quarter, revenues from the Contract Drilling segment fell 19.3% year over year to approximately $555.6 million.

Ultra-Deepwater floaters recorded an average dayrate of $531,000 during the quarter, up from $493,000 in the year-earlier quarter. Deepwater floaters realized an average dayrate of $337,000 compared with $431,000 in the year-ago quarter. Mid-water floaters recorded an average dayrate of $249,000, down from $270,000 in the prior-year quarter. Jackup rig dayrates averaged $124,000, up from $96,000 in the fourth quarter of 2014.

Rig utilization for Ultra-Deepwater floaters increased to 70% from 66% in the year-ago quarter. Utilization of Deepwater floaters fell to 42% from 48% a year ago. Mid-water category rig utilization was 24% against 55% in the comparable quarter last year, while jackup rig utilization decreased significantly to 17% from 77%.

Financials

As of Dec 31, 2015, Diamond Offshore had approximately $119.0 million in cash and cash equivalents, while long-term debt totaled $1,994.7 million.

Zacks Rank

Diamond Offshore currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the same space are Cheniere Energy Partners LP. CQP , Braskem S.A. BAK and Enviva Partners, LP EVA . Each of these stocks sports a Zacks Rank #1 (Strong Buy).

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BRASKEM SA (BAK): Free Stock Analysis Report

DIAMOND OFFSHOR (DO): Free Stock Analysis Report

CHENIERE ENERGY (CQP): Free Stock Analysis Report

ENVIVA PARTNERS (EVA): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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