New Contracts Drive Diamond Offshore's Profit
Diamond Offshore on Monday reported a better-than-expected quarterly profit after securing more contracts for its deep-water drilling rigs at a higher rate, sending its shares up 13 percent in pre-market trading.
The company was able to secure additional work for its fleet, with new contracts for its deep-water drillers Ocean Apex and Ocean Patriot at rates well above cash flow breakeven, Chief Executive Mark Edwards said in a statement.
Contract drilling revenue rose 5.3 percent to $357.7 million, while total revenue was up 4.8 percent at $366 million.
Consolidation in the offshore drilling industry has helped companies raise prices.
Diamond Offshore, majority owned by Loews Corp, said net income fell to $10.8 million, or 8 cents per share, for the third quarter ended Sept. 30 from $13.9 million, or 10 cents per share, a year earlier.
The company booked $34.4 million in costs related to debt repayment.
Excluding items, it reported a profit of 25 cents per share beating the average analyst estimate of 20 cents per share, according to Thomson Reuters I/B/E/S.
Reporting by Akshara P
