The company also announced that it expects earnings for First Quarter of 2006 to be between $0.29 and $0.31. During the recently completed quarter, the company completed a historically high six dry-dockings plus two partial dockings, expensing approximately $3 million and using approximately 130 days to complete the dockings. In addition, to meet the requirements of previously announced and developing contracts, vessels were out of service for mobilization covering nearly 60 days with only partial reimbursement for the costs incurred in moving vessels to the new locations. Administrative costs during the first quarter were also higher than the historical run rate primarily due to a number of non-recurring expenses.
Bruce Streeter, President and Chief Operating Officer of the Company, commented: "Our plan was and is to maximize the non-revenue days during the first half of the year allowing us to benefit from day rates as they escalate. Market conditions, primarily in the North Sea spot market, were weaker at the outset of the year than during 2005 and where possible, we moved our non-revenue days into that period. Recently however, we have seen some of the strongest rate periods ever experienced, and as we approach the end of April, some short-term rates have been above historical highs. As a result, we expect to recover the first quarter effects of dry-docks and mobilization as we anticipate improved results in each of the succeeding quarters.
"Overall, the demand for vessel services in international operating areas continues to be strong with significant improvements in term rates in key areas both by location and type of vessels. Short-term rates are expected to remain at or above historical peak rates for sometime, and, to the extent possible, we intend to take advantage of the near-term benefit as well as increasing coverage and earnings power from contracts into the future."
Most Popular Articles
From the Career Center
Jobs that may interest you