Transocean Ltd.'s first-quarter profit soared as the offshore-oil driller benefitted from a year-earlier comparison that included significant impairment and discontinued-operations losses, but results still missed analysts' expectations.
The world's biggest deep-water driller was the owner of the Deepwater Horizon, the rig that exploded and sank in the Gulf of Mexico in 2010, killing 11 people and setting off the worst offshore oil spill in U.S. history.
Last month, Transocean said it had started cutting positions and closing facilities tied to its onshore business, continuing the company's efforts to focus on the higher end of the offshore drilling market. On Wednesday, the company said early analyses showed the initial phase of cost reductions should lead to annualized savings of about $300 million.
The company is under pressure from activist investor Carl Icahn, who is the company's largest shareholder and has urged it to declare a $4-a-share dividend, saying he believes its shares are undervalued.
Transocean reported a profit of $321 million, or 88 cents a share, up from $10 million, or three cents a share, a year earlier. The latest period included 15 cents a share related to an adjustment in contingencies associated with the Macondo Well incident and 10 cents a share in tax benefits. The year-earlier quarter included impairment losses of 38 cents a share and losses associated with discontinued operations of 39 cents a share.
Excluding special items, adjusted earnings rose to 93 cents a share from 75 cents a share a year earlier.
Revenue climbed 4% to $2.2 billion.
Analysts polled by Thomson Reuters had predicted a profit of $1 a share on revenue of $2.36 billion.
Operating and maintenance expenses grew 11%.
Average daily revenue was up 0.9% from a year earlier and fell 5.4% from the prior quarter. Its fleet utilization rate was 80%, versus 74% in the prior year.
Copyright (c) 2012 Dow Jones & Company, Inc.
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