By Melodie Warner
Diamond Offshore Drilling Inc.'s (DO) fourth-quarter earnings
fell 17% as lower day rates dampened improved utilization of
ultradeep-water and midwater floaters.
Results topped consensus estimates and the contract driller's
board once again declared a special cash dividend of 75 cents a
share. The board also reiterated its policy of considering the
payment of special cash dividends on a quarterly basis.
Diamond Offshore, which is majority owned by Loews Corp. (L),
had seen declining revenue over the past year as the
offshore-drilling sector struggles with a recovery from 2010's
Deepwater Horizon rig explosion in the Gulf of Mexico. U.S.
authorities in February 2011 resumed the approval of deep-water
drilling programs, which now face heightened scrutiny.
Diamond Offshore reported a profit of $155.7 million, or $1.12 a
share, down from $188.5 million, or $1.36 a share, a year earlier.
Revenue climbed 0.3% to $750.5 million.
Analysts polled by Thomson Reuters had most recently forecast
earnings of $1.10 a share on revenue of $740 million.
Operating margin shrank to 26% from 29.2%.
Day rates for ultradeep-water floaters fell 2.2%, while
utilization increased to 89% from 70% a year earlier.
For deep-water floaters, day rates dropped 12% while utilization
fell to 85% from 97%.
Meanwhile, midwater floaters saw a 1.1% decline in day rates,
with utilization improving to 70% from 60%.
Shares closed Monday at $76.48 and were inactive premarket. The
stock has gained 21% over the past year.
Write to Melodie Warner at melodie.warner@dowjones.com
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