By Melodie Warner
Diamond Offshore Drilling Inc. (DO) second-quarter earnings fell
8% from a year-earlier period that included a gain from selling
rigs while the contract driller's revenue improved.
The company also declared a special 75-cent dividend that will
be paid Sept. 3--along with its regular 12.5 cents quarterly
dividend--to shareholders of record as of Aug. 6.
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 $185.3 million, or $1.33 a
share, down from $201.5 million, or $1.45 a share, a year earlier.
The year-earlier quarter included a per-share gain of 36 cents from
the sale of five jack-up rigs. Revenue jumped 2.7% to $758
million.
Analysts polled by Thomson Reuters had most recently forecast
earnings of $1.24 a share on revenue of $767 million.
Operating margin edged down to 34.7% from 34.8%.
Day rates for ultradeep-water floaters fell 3.4%, while
utilization increased to 92% from 89% a year earlier.
For deep-water floaters, day rates jumped 9.9%, and utilization
rose to 99% from 83%.
Meanwhile, midwater floaters posted a 3.4% rise in day rates,
with utilization weakening to 65% from 66%.
Shares closed Wednesday at $71.50 and were inactive premarket.
The stock is up 5.2% so far this year.
Write to Melodie Warner at melodie.warner@wsj.com
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