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Diamond Offshore Announces Second Quarter 2013 Results

HOUSTON, July 25, 2013 /PRNewswire/ -- Diamond Offshore Drilling, Inc. (NYSE: DO) today reported net income for the second quarter of 2013 of $185 million, or $1.33 per share on a diluted basis, compared with net income of $201 million, or $1.45 per share on a diluted basis, in the same period a year earlier.  Results for the prior-year second quarter included an after-tax gain of approximately $50.5 million, or $0.36 per share, related to the sale of five jack-up rigs. 

Revenues in the second quarter of 2013 were $758 million, compared with revenues of $738 million in the prior-year quarter. 

"Our solid operating results for the quarter reflect our ongoing focus on cost and downtime management," said Larry Dickerson, President and Chief Executive Officer of Diamond Offshore. 

"During the quarter we announced an agreement to build a new harsh environment semisubmersible that will work offshore South Australia for BP beginning in 2016," said Dickerson.  "This represents a unique opportunity to construct a rig whose initial contract should return a substantial portion of our investment.  Additionally, our construction efforts include four ultra-deepwater drillships and two deepwater semis that should meaningfully contribute to earnings beginning next year based on the contracts covering the first three units."

CONFERENCE CALL

A conference call to discuss Diamond Offshore's second-quarter results has been scheduled for 9:00 a.m. CDT today.  A live webcast of the call will be available online on the Company's website, www.diamondoffshore.com.  Those interested in participating in the question and answer session should dial 800-247-9979 or 973-321-1100, for international callers.  The conference ID number is 14337370.  An online replay will also be available on www.diamondoffshore.com following the call.

ABOUT DIAMOND OFFSHORE

Diamond Offshore provides contract drilling services to the energy industry and is a leader in deepwater drilling.  Diamond Offshore's fleet of offshore drilling rigs consists of 30 semisubmersibles, seven jack-ups and one drillship, in addition to four ultra-deepwater drillships and three deepwater semisubmersibles currently under construction.  Information about the Company and access to the Company's SEC filings are available at www.diamondoffshore.comDiamond Offshore is owned 50.4% by Loews Corporation (NYSE: L).

FORWARD-LOOKING STATEMENTS

Statements contained in this press release that are not historical facts are "forward-looking statements" within the meaning of the federal securities laws.  Such statements include, but are not limited to, statements concerning future operating costs and expenses, future operations, future earnings and future return on investment.  Forward-looking statements are inherently uncertain and subject to a variety of assumptions, risks and uncertainties that could cause actual results to differ materially from those anticipated or expected by management of the Company.  A discussion of the important risk factors and other considerations that could materially impact these matters as well as the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission and readers of this press release are urged to review those reports carefully when considering these forward-looking statements.  Copies of these reports are available through the Company's website at www.diamondoffshore.com.  These factors include, among others, general economic and business conditions, contract cancellations, customer bankruptcy, operating risks, casualty losses, industry fleet capacity, changes in foreign and domestic oil and gas exploration and production activity, competition, changes in foreign, political, social and economic conditions, regulatory initiatives and compliance with governmental regulations, customer preferences and various other matters, many of which are beyond the Company's control.  Given these risk factors, investors and analysts should not place undue reliance on forward-looking statements.  Each forward-looking statement speaks only as of the date of this press release.  The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.

 

 

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)







Three Months Ended

Six Months Ended



June 30,

June 30,


2013

2012

2013


2012











Revenues:










   Contract drilling

$

744,898

$

726,261

$

1,444,871


$

1,481,416

   Revenues related to reimbursable expenses


13,120


11,927


42,888



25,414

      Total revenues


758,018


738,188


1,487,759



1,506,830











Operating expenses:










   Contract drilling, excluding depreciation


369,036


405,252


744,130



802,354

   Reimbursable expenses


12,805


11,637


42,094



24,788

   Depreciation


97,143


99,469


193,964



200,862

   General and administrative


16,435


18,741


33,250



36,327

   Bad debt recovery


--


(400)


--



(1,018)

   Gain on disposition of assets


(260)


(53,695)


(2,264)



(79,077)

      Total operating expenses


495,159


481,004


1,011,174



984,236











Operating income


262,859


257,184


476,585



522,594











Other income (expense):










   Interest income


271


1,496


888



3,279

   Interest expense


(7,951)


(12,731)


(16,020)



(28,060)

   Foreign currency transaction gain


448


1,083


607



979

   Other, net


674


(274)


420



(599)











Income before income tax expense


256,301


246,758


462,480



498,193











Income tax expense


(70,967)


(45,297)


(101,157)



(111,563)











Net Income

$

185,334

$

201,461

$

361,323


$

386,630











Income per share:










   Basic

$

1.33

$

1.45

$

2.60


$

2.78

   Diluted

$

1.33

$

1.45

$

2.60


$

2.78











Weighted average shares outstanding:










   Shares of common stock


139,035


139,029


139,034



139,028


   Dilutive potential shares of common stock


37


11


43



11


      Total weighted average shares outstanding


139,072


139,040


139,077



139,039


 

 

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
(Unaudited)
(In thousands)




Three Months Ended



Jun 30,


Mar 31,


Jun 30,



2013


2013


2012








REVENUES







 Floaters:







   Ultra-Deepwater

$

231,101

$

191,357

$

233,071

    Deepwater


184,105


164,420


142,565

    Mid-water


288,860


305,221


310,462

      Total Floaters


704,066


660,998


686,098

  Jack-ups


40,832


38,975


40,163

Total Contract Drilling Revenue

$

744,898

$

699,973

$

726,261








Revenues Related to Reimbursable
Expenses

 

$

13,120

$

29,768

$

11,927








CONTRACT DRILLING EXPENSE







 Floaters:







   Ultra-Deepwater

$

128,147

$

135,776

$

137,087

    Deepwater


60,126


56,436


68,653

    Mid-water


139,252


143,647


160,642

      Total Floaters


327,525


335,859


366,382

  Jack-ups


27,377


29,667


29,240

  Other


14,134


9,568


9,630

Total Contract Drilling Expense

$

369,036

$

375,094

$

405,252








Reimbursable Expenses

$

12,805

$

29,289

$

11,637








OPERATING INCOME







 Floaters:







   Ultra-Deepwater

$

102,954

$

55,581

$

95,984

    Deepwater


123,979


107,984


73,912

    Mid-water


149,608


161,574


149,820

      Total Floaters


376,541


325,139


319,716

  Jack-ups


13,455


9,308


10,923

  Other


(14,134)


(9,568)


(9,630)

  Reimbursable expenses, net


315


479


290

  Depreciation


(97,143)


(96,821)


(99,469)

  General and administrative expense


(16,435)


(16,815)


(18,741)

  Bad debt recovery


--


--


400

  Gain on disposition of assets


260


2,004


53,695

          Total Operating Income

$

262,859

$

213,726

$

257,184











 

 


DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)











June 30,

December 31,





2013


2012



(unaudited)



ASSETS










Current assets:






Cash and cash equivalents

$

369,972

$

335,432








Marketable securities


850,232


1,150,158








Accounts receivable, net of allowance for bad debts


485,878


499,660








Prepaid expenses and other current assets


145,111


136,099








Assets held for sale


11,594


11,594



Total current assets


1,862,787


2,132,943






Drilling and other property and equipment, net of





     accumulated depreciation


5,239,231


4,864,972







Other assets


210,484


237,371



Total assets 

$

7,312,502

$

7,235,286








LIABILITIES AND STOCKHOLDERS' EQUITY










Current liabilities

$

432,584

$

485,546






Long-term debt


1,496,192


1,496,066






Deferred tax liability


511,492


490,946






Other liabilities


186,067


186,334








Stockholders' equity


4,686,167


4,576,394










Total liabilities and stockholders' equity

$

7,312,502

$

7,235,286

















 

 

DIAMOND OFFSHORE DRILLING, INC. AND SUBSIDIARIES
AVERAGE DAYRATES AND UTILIZATION
(Dayrate in thousands)




Second Quarter

First Quarter

Second Quarter



2013

2013

2012



Dayrate

Utilization

Dayrate

Utilization

Dayrate

Utilization

Ultra-Deepwater Floaters

$342

92%

$360

73%

$354

89%

Deepwater Floaters

$409

99%

$389

94%

$372

83%

Mid-Water Floaters

$271

65%

$262

64%

$262

66%

Jack-Ups

$88

74%

$85

71%

$94

49%





















 

 

Contact:
Darren Daugherty
Director, Investor Relations
(281) 492-5370

SOURCE Diamond Offshore Drilling, Inc.