Hurricanes Trim Hercules Offshore Revenue by $8.7MM
Hercules Offshore reported that its third quarter 2008 financial results were adversely impacted by the recent hurricane activity in the U.S. Gulf of Mexico. The Company experienced extensive downtime across all of its domestic segments as a result of the four named storms that entered the U.S. Gulf of Mexico during the third quarter. Overall, these storms resulted in an approximate $8.7 million reduction in expected revenue.
As a result of these disruptions, the Company also incurred significant incremental operating costs in the amount of approximately $2.2 million for the third quarter and expects to incur approximately $10.0 million in the fourth quarter of 2008, largely related to repairs on the Hercules 78 and Hercules 201, which are expected to last approximately 30 days. The Company does not expect that the repairs to the damaged rigs will exceed the $10.0 million insurance deductible that applies for each named windstorm in the U.S. Gulf of Mexico.
Overall, as a result of these factors, our third quarter 2008 fully-diluted earnings per share from continuing operations are expected to range between $0.36 and $0.38.
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