Rowan swings to profit in 4Q
Rowan Companies, a global provider of contract drilling services, on Friday posted net income of $124.4 million for the 4Q 2015, compared to $326.9 million loss in the prior-year quarter.
For the prior-year quarter, the company reported a net loss of $326.9 million, which included a non-cash asset impairment charge of $438.4 million (after tax), relating to the company’s twelve oldest jack-up rigs.
Excluding the impact of this non-cash asset impairment charge, net income was $111.5 million, in the fourth quarter of 2014.
The current quarter includes a gain on the sale of the Rowan Louisiana of $6.3 million (after tax), and a $1.0 million loss on extinguishment of debt (after tax).
Excluding the impact of these items, net income as adjusted was $119.1 million, in the fourth quarter of 2015.
Rowan’s revenues were $535.8 million in the fourth quarter of 2015, a decrease of 4% from the prior-year quarter that amounted to $556.2 million, as a significant increase in jack-up idle time more than offset increased contributions from the company’s four newbuild ultra-deepwater drillships.
Additionally, Rowan announced a recently executed contract with EOG in Trinidad for the 2009-built jack-up rig Ralph Coffman.
The rig will mobilize from the US Gulf of Mexico and is estimated to start operations in the third quarter of this year for five wells with an estimated duration of one year at a rate of $135,000/ day, inclusive of amortized lump sum fees.
Tom Burke, President and Chief Executive Officer, commented, “While Rowan finished 2015 with exceptional operational performance and the best safety related performance, highest EBITDA and EBITDA margins in the Company’s recent history, we are mindful of the extremely challenging market environment that lies ahead.”
Burke added: “As we continue to navigate through this down cycle we will continue to focus on revenue efficiency and reducing our cost structure to further enhance our competitive position.”
Offshore Energy Today Staff