For the nine months ended June 30, 2007, the Company reported net income of $332,851,000 ($3.17 per diluted share) from operating revenues of $1,180,209,000 compared with net income of $195,362,000 ($1.84 per diluted share) from operating revenues of $866,014,000 during the nine months ended June 30, 2006. Included in net income were gains from the sale of portfolio securities and drilling equipment, and gains from insurance settlements of $0.60 per share for the first nine months of fiscal 2007, and $0.11 per share for the first nine months of fiscal 2006.
Operating income in the U.S. land segment increased during the quarter to $114.6 million, from $93.7 million during last year's third quarter, and $109.8 million during this year's second quarter. The sequential increase is largely due to incremental new build rig commencements during the quarter, as well as the Company's ability to sustain high activity levels in the spot market. Average rig activity in the segment increased by 12 rigs to a total of 136 average active rigs during the third quarter, and rig utilization for the quarter was 96%. Although the segment's average revenue per rig day increased sequentially, the increase was more than offset by higher operating costs which resulted in the average margin per rig day decreasing sequentially by $476 per rig day.
The Company's U.S. offshore operations reported segment operating income of $3,013,000 for the third quarter of fiscal 2007, compared with $7,635,000 for the third quarter of fiscal 2006, and $2,198,000 for the second quarter of fiscal 2007. Total activity days in the U.S. offshore platform operations during the quarter were 546, compared with 728 activity days during the same period last year, and 522 days during the second quarter of fiscal 2007. Operating income improved sequentially due to improved activity and higher rig margins.
Segment operating income for the Company's international operations was $30,413,000 during this year's third quarter, compared with $17,685,000 during last year's third quarter and $21,481,000 during this year's second quarter. The sequential increase was primarily due to a substantial improvement in average rig revenue and margin per day. Average rig utilization for the third quarter of 2007 dropped to 90%, from 93% for both the third quarter of fiscal 2006 and the second quarter of fiscal 2007. International rig utilization for the fourth quarter of fiscal 2007 is anticipated to be slightly lower than the third quarter, and segment operating income will be negatively impacted by the reduction in labor contract revenue and operating income resulting from the associated platform rig in Equatorial Guinea recently being cold stacked.
Helmerich & Payne, Inc. also announced today that it had signed two three-year term contracts with an exploration and production company to operate two new FlexRigs®*. The name of the customer and other terms were not disclosed. This brings to 77, the total number of new FlexRig commitments with at least three-year term contracts that have been announced by the Company since March 2005. To date, 64 of the new builds have been completed, with the remaining 13 scheduled for completion by the second quarter of fiscal 2008.
Company President and C.E.O., Hans Helmerich commented, "The Company's improvement in net income reflects results of the Company's strategy of delivering to our customers lower drilling costs by using the newest and best rig technology. In a time period where many of our competitors are recording net reductions in rig activity and income, our U.S. land utilization remains high while delivering additional activity days at strong day rates and margins. We believe exploration and production companies in the U.S. and abroad will continue to search for opportunities to upgrade their operations by contracting higher quality rigs. The announcement of two additional new FlexRig commitments signals the ongoing interest in that approach."
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