Transocean Profit Slides on Lower Rig Demand

Reuters – Transocean Ltd, owner of the world's largest offshore drilling fleet, said on Wednesday that fourth-quarter profit fell 49 percent from a year ago, hurt by lower rig utilization.

The company's net profit attributable to controlling interest fell to $233 million, or 64 cents per share, from $456 million, or $1.26 per share, a year earlier.

The driller for the oil industry said about $34 million in unfavorable charges affected its profit in the latest quarter, and that its year-ago profit was boosted by $126 million in favorable items.

Revenue rose marginally to $2.332 billion from $2.326 billion in the quarter ended Dec. 31, 2013.

Shares of the company fell nearly 1 percent to $43.01.

Total fleet rig utilization dropped to 75 percent in the latest quarter from 83 percent in the third quarter and from 79 percent a year ago. The company also said its contract backlog was down to $27.2 billion in February from $29.8 billion in October.

Some major oil companies have trimmed their capital budgets in recent months to rein in spiraling exploration and production costs that have irked some investors.

Transocean, which expects 2014 capital expenditures of $2.6 billion, said two ultra-deepwater drillships were in contract to be built for $1.24 billion. They would be delivered in the second quarter of 2017 and the first quarter of 2018.

Source: Reuters