Where did you read "Stilley says"?
looks like a major down turn, rigs are on short term contracts. PEMEX limping along. I would expect new contracts at 40% less from PEMEX.
So far the impact on Q1 is 1m less in revenue.
I will guarantee oil will turnaround by end of year. Keep it for histarical reasons.
Dividend will be cut if oil stays at this level for the next year. How much, depends on contracts. NE is good mostly through 2016.
This is the time that history will repeat. Go back in time and watch what happens when demand equals supply, oil starts moving up to a price the operators need to start drilling short and long term, but this time we have a lot less old rigs in service. "Oh, the next rig will be available, in 2025"... CVX CEO is looking for a 40% increase in oil/gas by 2040 or so.
Na, they are going to pay off some current debt and move it out to later years They need to pay off (down) the revolver credit line, prepare for the 900mm due over the next 3 years and lock in some low rates for long term debt. The banks jumped at the idea of getting 4-6% verses -1.0% in Germany. You know "cash is king" in stressed businesses, and the drillers are being stressed (but not for long).
I wonder if hwhinny kwong was one of BO staff, he just has no clue what is going on.
Simple, you have offers at lower prices and sellers willing to sell at the lower price.
When oil start to firm and operators start contracting for new projects, then these stocks will move.
Cutting the dividend will happen if oil continues to stay under 60 into 2016.
Not much, 2k up and down, one shift off 6 months with same rate and time.
Q1 no change in revenue, ytd down 14mm.
This is like watching ice form on Lake Superior.
NE rigs are still turning and working, two Warm Stacked, and one cold stacked.
Hot air expands and dissipates into nothing as does your valueless statements.
If you can prove your value of 0 please do so for all us so can support your value statement.
NE has three choices. 1. pay the dividend (that is what they said they will do), 2. cut the dividend and buyback shares. 3. cut the dividend and pay down debt.
I would expect NE to do 1 and 3 over the next 6 months, then add 2 in the 3 or 4 quarter when the markets begin to return to 100 oil.
Ok lets rack up the "likes" lets see if we can get "10" by Monday.
They did buy back 13mm shares so far, just wished to wait to see what the markets are going to do. The do have cash and lines of credit up to 1B. The also paid off 700m in debt and 1.8B in capx last year. So they are doing what they said they would.
CS likes NE and called NE the top performer in the offshore market.
MLP is dead
Dividend to keep in place for 2015 pending of market conditions.
Share buybacks on hold for now
Goal is to keep 1B liquidity through the downturn.
Company focus: Execution, no new builds, buys or management contracts.
Speculators looking for rig management will not get an appointment with NE.
Shipyards most likely will get stuck with the spec rig.
In this cycle downturn NE is well positioned for it and the upturn when it starts.
If operator needs reduction in day rate, NE look for term extension (no loss of backlog $).
1. Conserve cash
2. Reduce operating costs across the company
3. Assume the worst in new contracts and stay out of the USA markets
4. Get financing for the line of credit that is going to be "put" to PGN from PROS.
5. No spec buying or anything else unless it has contracts and favorable financing. .
One comment... "i don't understand why your company is being hit so hard, you have bought back more debt than any other company at a discount doing exactly what you said you would do."
Look for a 20 to 25% in reduction in revenue for 2015. If PEMEX does not contract the WS rigs, they will look elsewhere.
Most of the work PGN does is development and workover which will continue even as exploration is reduced significantly.
I can't tell how long oil will be down here in the 50, but it will go back to 100 or more as that is what most of the govts have assumed oil would stay at.
Not much of a "normal" business operation, so it is difficult to see what is ahead.
It is fantastic that after all said and done, they did earn $.90 on revenue of 495mm
I will look more at the results, adjustments and scraps to see what revenue we might see and thus what eps. I think the Imp Charges are all related to the tax rate of 50% forecast just after the split from NE.
All in all, nice job in a bad business down turn.
If you were to eliminate the "analyst" that has eps of $(1.34) for 1216 what would the EPS be? I would say in the $.50 range or higher.
Deleted three rigs being retired, moved the Romano for one year contract to replace the Thompson. The Colbert had a rate adjustment extending contract for 2 to 4 months.
Not much other than these two entries.