Hercules Offshore sees deeper loss, lower revenues
U.S. offshore drilling contractor Hercules Offshore has reported a deeper net loss and lower revenues for the third quarter of 2015 compared to those posted same time last year.
The offshore drilling contractor posted on Thursday a net loss of $95.4 million, compared to a net loss of $88.6 million in the corresponding period last year.
Hercules’ revenues for the 3Q 2015 dropped to $73.8 million, compared to revenues of $221.9 million posted in the third quarter of 2014.
According to Hercules, its domestic offshore revenues dropped 78% to $27.5 million from $123.3 million in the third quarter 2014 driven by lower utilization and dayrates on a reduced marketed rig fleet, while international offshore revenues declined to $31.9 million in the third quarter 2015 from $74.2 million in the third quarter 2014.
In addition, Hercules’ liftboats revenues declined to $14.4 million in the third quarter 2015 from $24.3 million in the prior year period as a result of both lower dayrates and operating days.
John T. Rynd, Chief Executive Officer and President of Hercules Offshore, stated: “We continue to face challenging market conditions in both our drilling and liftboat businesses, but I am proud of the work our team has done in keeping our focus on the things we can control.”
According to the drilling contractor, third quarter 2015 results include adjustments of $8.3 million related to pre-petition financing and restructuring activities which are included in general and administrative expenses and $14.3 million related to post-petition reorganization items which are included in other expenses. Combined, these items totaled $22.6 million, during the third quarter 2015.
Third quarter 2014 results included a non-cash impairment charge of $82.5 million related to cold stacking four jack-ups and a $4.7 million net gain on the sale of three jack-ups for a total net adjustment of $77.8 million.
Rynd added: “We have made significant reductions in our cost structure, without compromising safety and the quality of our services, and remain vigilant for additional cost efficiency measures throughout the organization.
“We have also made significant progress on our capital restructuring plan, and are on pace to emerge from Chapter 11 shortly. Moving forward, our restructuring plan will significantly improve our balance sheet by reducing our debt, and adding new liquidity to secure delivery of the Hercules Highlander and fund our operations.”