Highlights for the third quarter
- Economic Utilization1 of 98%.
- Revenues of $136.7 million.
- Operating income of $28.7 million.
- EBITDA2 of $83.7
million.
- Net loss of $12.8 million and net loss
attributable to shareholders of $16.2 million. The loss per share
was $0.67.
Financial highlights
Third quarter 2016 results
Revenues for the third quarter
2016 were $136.7 million compared to $164.6 million for the second
quarter of 2016. The primary reason for the decrease is the
West Phoenix and the West
Alpha coming to an end of their contracts in August 2016,
partly offset by demobilization revenue for the West Alpha.
Operating income for the third
quarter was $28.7 million, a decrease of $25.3 million compared to
the second quarter of 2016 operating income of $54.0 million. The
decrease in operating income is primarily due to the West Phoenix and West Alpha
concluding contracts.
Net financial items for the third
quarter of 2016 amounted to a charge of $22.4 million. The charge
included $26.6 million in interest expenses and a gain on financial
derivatives of $12.9 million, partly offset by a foreign exchange
loss of $5.6 million related to the NOK1,500 million bond loan. The
second quarter of 2016 incurred a net financial charge of $35.8
million, including interest expenses of $26.8 million, and a loss
on derivatives of $8.5 million.
Income tax expense for the third
quarter was $19.1 million, compared to $1.6 million in the second
quarter of 2016. The increase is mainly attributable to a change
estimate of the deferred tax liabilities recognized on long term
maintenance.
Net loss for the third quarter was
$12.8 million and net loss attributable to shareholders was $16.2
million, resulting in a basic loss per share of $0.67. This is
compared to net income of $16.6 million and a net income
attributable to shareholders of $12.9 million for the second
quarter of 2016.
The Company reports operating
revenues of $452.9 million, operating income of $115.7 million and
a net loss of $2.3 million for the nine months ended
September 30, 2016. This compares to operating revenues of
$597.3 million, operating income of $158.6 million and a net income
of $34.3 million for the nine months ended September 30,
2015.
Balance sheet as at September 30, 2016
As at September 30, 2016,
total assets decreased to $3,038.3 million from $3,119.1 million
compared to the previous quarter.
Total current assets decreased to
$230.4 million from $258.0 million compared to the previous
quarter. The decrease was mainly due to a decrease in accounts
receivables on the completion of the West
Alpha and West Phoenix drilling
contracts.
Total non-current assets decreased
to $2,807.9 million from $2,861.1 million compared to the previous
quarter. The decrease was mainly due to depreciation on drilling
units.
Total current liabilities
decreased to $1,332.6 million from $1,400.1 million compared to the
previous quarter. The decrease is primarily due to repayments of
debt of $53.5 million and also a fall in the mark-to-market
interest rate swap liabilities, which fell by $25.8 million to
$98.7 million.
Total interest bearing debt,
including related party debt and the current portion, decreased to
$2,343.0 million from $2,384.8 million during the quarter.
During the third quarter the Company repaid $41.7 million on the $2
billion credit facility and $11.9 million on the SFL Linus $475
million credit facility.
Total equity decreased to $391.4
million from $402.6 million compared to the previous quarter. The
decrease is primarily due to the net loss for the quarter of $12.8
million.
Cash flow
As at September 30, 2016,
cash and cash equivalents increased to $86.1 million from $80.0
million compared to the previous quarter.
For the nine-month period ending
September 30, 2016, net cash provided by operating activities
was $91.8 million, net cash provided by investing activities
amounted to $2.5 million, and net cash used in financing activities
was $164.7 million. For the nine-month period ending
September 30, 2015, net cash provided by operating activities
was $281.1 million, net cash used in investing activities amounted
to $29.9 million, and net cash used in financing activities was
$210.6 million. The fall in net cash from operating activities
compared to the prior year is due to the fall in operating income
and the increase in outflows of working capital balances.
This information is subject
to the disclosure requirements pursuant to section 5-12 of the
Norwegian Securities Trading Act.