Transocean Posts Surprise Profit Rise

Reuters

Transocean Ltd, owner of the world's largest offshore drilling fleet, reported on Wednesday a larger-than-expected third-quarter profit due to increased demand for its rigs and higher rates, sending its shares up 2 percent.

Net income for the quarter was $546 million, or $1.50 per share, compared with a loss of $381 million, or $1.06 per share, a year ago, when it took an $878 million charge for its exit from the lower end of the shallow-water jackup rig market.

As the company seeks to reshape its fleet, it also announced the construction of five new jackup rigs for $1.2 billion, with the first due to be delivered in early 2016.

"We are very excited about the potential for these rigs given our expectation for continued customer demand for assets of this capability and the outstanding operating performance of the four new high-specification jackups we have recently placed into service," Chief Executive Steven Newman said in a statement.

Excluding one-time items, Transocean earned $1.37 per share, or 30 cents above the average of analysts' estimates on Thomson Reuters I/B/E/S. Revenue rose 5 percent to $2.56 billion, above an average estimate of $2.49 billion.

Average daily revenue for all its rigs rose 4 percent to above $392,000 in the quarter, while utilization of the fleet overall increased to 83 percent from 80 percent a year ago.

Transocean shares rose 2 percent after hours to $50.00 after closing 1.7 percent higher on Wednesday.

The Switzerland-based company will discuss the quarter in more detail on a conference call with analysts on Thursday.

Copyright 2016 Thomson Reuters. Click for Restrictions.

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