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McDermott (MDR) Gains on Stellar Q3 Earnings, Revenues

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Offshore oil and gas-focused engineering and construction firm, McDermott International Inc.MDR reported stellar third-quarter 2015 results. New contracts and improved execution of projects led to the outperformance. Shares of McDermott soared over 14% in the after-hours trading session following the results.

The company reported adjusted earnings of 9 cents per share, which compared favorably with the year-ago quarter loss of 14 cents. The Zacks Consensus Estimate was of a loss of 5 cents for the quarter.

McDermott International Inc. (MDR) - Earnings Surprise | FindTheCompany

McDermott generated revenues of about $806 million in the quarter, which surged from the prior-year quarter level of $414.6 million. The top line also came in significantly above the Zacks Consensus Estimate of $780 million.

Total Expenses

Total costs and expenses increased a massive 83% from that in the year-ago quarter to about $772 million.

Backlog

At the end of the third quarter, McDermott had a backlog of $4,420.6 million, up from $3,979.7 million a year ago. Of the total backlog, 73% is related to offshore operations while the remaining 27% pertains to subsea operations.

Balance Sheet

Capital expenditure for McDermott during the quarter was about $18.1 million.

As of Sep 30, 2015, McDermott had cash and cash equivalents of $631.4 million and long-term debt (including current maturities) of approximately $851.2 million. This represents a debt-to-capitalization ratio of about 35.4%.

Other News

McDermott has been awarded an engineering, procurement, construction and installation (EPCI) contract offshore Qatar by RasGas Company Limited. The company expects work on the project to be completed by the third quarter of 2017.

Zacks Rank and Key Stock Picks

Houston, TX-based McDermott currently carries a Zacks Rank #3 (Hold).

Some better-ranked players from the oilfield machinery and equipment industry are Matrix Service Company MTRX , PowerSecure International, Inc. POWR and Profire Energy, Inc. PFIE . While Matrix sports a Zacks Rank #1 (Strong Buy), both PowerSecure and Profire Energy have a Zacks Rank #2 (Buy).

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MATRIX SERVICE (MTRX): Free Stock Analysis Report

MCDERMOTT INTL (MDR): Free Stock Analysis Report

PROFIRE ENERGY (PFIE): Free Stock Analysis Report

POWERSECURE INT (POWR): 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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