Northern Offshore Reels in $22.5MM for Second Quarter Net
Northern Offshore, Ltd. reported net income for the three months ended June 30, 2008 of US $22.5 million, or US $0.15 per diluted share, compared to net income of US $16.6 million, or US $0.11 per diluted share for the second quarter of 2007.
Revenues for the second quarter of 2008 were US $72.3 million compared to US $42.5 million for the second quarter of 2007.
For the six month period ended June 30, 2008 net income totaled US $32.0 million or US $0.21 per diluted share. For the same period in the prior year, net income totaled US $41.9 million or US $0.29 per share. Revenues for the first half of 2008 were US$124.9 million compared to US $84.3 million for the same period last year.
Northern Offshore President and CEO, Marion Woolie, commented, "We are pleased with our improved second quarter results. We are starting to realize the benefits of higher market dayrates and are looking forward to the additional growth that the recently announced acquisitions will bring in the near future."
Second Quarter Analysis
Revenues for the three months ended June 30, 2008 increased US$29.8 million compared to the same period of 2007. The increase in revenue for the second quarter of 2008 included the full quarter of operating results from the three jackup rigs acquired from A.P. Moller Maersk A/S (Maersk) in mid June 2007 compared to just 15 days during the same period of 2007.
Additionally, the Energy Searcher experienced higher utilization and dayrates during the 2008 quarter. This revenue growth was partially offset by lower revenue from the Energy Driller, a semisubmersible that completed it upgrades in mid April 2008 and was mobilized to India for a three-year contract, and lower revenue from the Northern Producer, a floating production platform which came off contract in June 2007. The Northern Producer is currently being refurbished for a new life-of-field contract in the U.K. North Sea.
Operating, general and administrative and DD&A expenses for the second quarter of 2008 all showed significant increases compared to the same period of 2007, related primarily to the impact of the three jackup rigs acquired from Maersk in mid June 2007. Similarly, the amortization of drilling contract intangibles increased US $5.5 million and interest expense was up US $4.0 million due to the 2007 rig acquisitions.
Several key items for the second quarter of 2008 are noted below:
- The Energy Driller completed its upgrades in Singapore and subsequent repairs in India following damage caused by Cyclone Nargis while mobilizing to India. As a result of the cyclone, contract commencement was a delayed until July 1, 2008.
- The Energy Exerter completed its contract preparation work in mid May and mobilized to its first drilling location for a subsidiary of Gazprom in early June where it is currently operating in the Pechora Sea, offshore Russia. In addition, the Energy Exerter "Safety Case" was approved by the U.K. Health and Safety Executive. This approval will position the company to operate the rig in the U.K. sector of the North Sea.
- The Energy Searcher completed its contract with P.T. Easco Sepanjang in late June and is currently available for work.
Manages 9 Offshore Rigs
- Northern Offshore Delays Delivery of 2 Jackups Now Being Built in China (Apr 01)
- Northern Offshore Issues Notice to Terminate Contract for Energy Searcher (Jan 13)
- Energy Searcher Signed Up for Nigeria Drill (Dec 09)