At March 31, 2003, the Company's consolidated balance sheet reflected $2.03 billion in shareholders' equity, $214.2 million in cash and marketable securities, and $654.6 million in total debt.
James C. Day, Chairman and Chief Executive Officer, said, "As anticipated, activity in the Gulf continues to remain weak. Further, there are no leading market indicators that would suggest a near-term turnaround in the U.S. Gulf."
Offshore contract drilling services revenues from deepwater drilling units (capable of drilling in 4,000 feet and greater) accounted for approximately 36 percent of the Company's total offshore contract drilling services revenues for the first quarter of both 2003 and 2002. The Company currently operates five deepwater semisubmersibles in the Gulf of Mexico and one deepwater semisubmersible and three deepwater drillships offshore Brazil. Offshore contract drilling services revenues from international sources accounted for approximately 74 percent and 67 percent of the Company's total offshore contract drilling services revenues for the first quarter of 2003 and 2002, respectively. Results for the first quarter of 2003 were adversely impacted by weaker market conditions in certain international markets, primarily the North Sea and West Africa. The average dayrate for the Company's international rigs was $56,444 in the first quarter of 2003 compared to $62,820 in the first quarter of 2002. Likewise, utilization on these rigs decreased from 93 percent in the first quarter of 2002 to 90 percent in the first quarter of 2003. Utilization and average dayrates on our deepwater assets in the U.S. Gulf of Mexico were also lower in the recent quarter as compared to the first quarter of 2002. Utilization on these units decreased from 91 percent in the first quarter of 2002 to 86 percent in the first quarter of 2003, and the average dayrate decreased 10 percent to $113,845 in the first quarter of 2003. The average dayrate on the Company's domestic jackup rigs was $27,031 in the first quarter of 2003, or five percent lower than the same quarter of last year. Utilization on these units increased to 79 percent in the first quarter of 2003 as compared to 74 percent in the first quarter of 2002. However, the Company had 51 percent fewer available days for domestic jackup rigs during the first quarter of 2003 as compared to the same quarter of last year following the mobilization of six premium jackup units out of this region to Mexico under long-term contracts since September 2002.
Day said, "The industry should experience improvement in the U.S. Gulf of Mexico activity levels in the fourth quarter, while key international markets will improve throughout the year. OPEC's affirmation of a $25.00 per barrel target price will obviously assist in calming the markets."
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