Boston, MA 05/12/2014 (wallstreetpr) – Offshore drilling contractor Transocean LTD (NYSE:RIG) announced strong financial results for the first quarter driven by higher revenues as well as increased rate of efficiency despite a fall in fleet utilization level. This translated into the company delivering adjusted earnings per share way above the market expectations triggering fresh interest in the stock.
1Q Results
Transocean LTD (NYSE:RIG) earned a profit of $456 million, 42% higher than $321 million and earnings per share surged 40% to $1.25 from $0.88 in the year-ago quarter. On an adjusted basis, after excluding charges and gains, net profit from continuing operations jumped 52% to $520 million or $1.43 a share from $342 million or 94 cents a share in the year-ago quarter. Wall Street analysts, on average, expected earnings of $1.02 a share. This is 42% more than the Street predictions.
Transocean LTD (NYSE:RIG)’s total revenues rose 7% to $2.34 billion from $2.18 billion in the previous year quarter. Analysts’ predictions was $2.27 billion, which has come again well ahead of the Street’s estimations.
Revenue from contract drilling witnessed 7% growth at $2.29 billion fueled by increased fleet revenue efficiency rate of 95.7% compared to 88% in the year earlier quarter. Its efficient rate on ultra-deepwater also increased to 96.4% from 90.0% in the previous year quarter. However, the company witnessed a slight fall in the fleet utilization level to 78% from 80% in the prior year first quarter.
Cost Control
The strong quarterly bottom line was also due to the management’s cost control. Its costs and expenses witnessed a 5.8% drop to $1.60 billion from $1.7 billion and that its operating and maintenance expenses slipped 6.4% to $1.27 billion from $1.35 billion in the year-ago quarter. The company attributed the positive results due to lower maintenance and shipyard costs besides its cost cutting program.
Transocean LTD (NYSE:RIG) said that it has secured an additional $470 million worth of contracts after the backlog fleet status report of $26.1 billion that existed as on April 17.
