Real nice quarter, had add 363mm in debt related to the prospector deal but only increased LT Debt by 110mm and ended the quarter with 30mm more in cash.
Earnings (ex 1 timers) was 40mm with EPS of $.47 per share.
I will review each line item and give my option for those interested in PGN.
You can not tell a book by its cover. Might look at the report and see what was extended.
Revenue went up for the quarter by 13mm, not bad given the down cycle in the drilling business.
Data from the company is becoming more solid, that is, without so many one-time things.
Actual to Forecast for Q1 2015
Revenue: 400A vs 398F
Reimb Exp 24A vs 25F
Labor Serv 7A vs 8F
Total Revenue 431A vs 431F
CD cost 225A vs 231F
Reimb Exp 20A vs 21F
Labor Cst 6A vs 6F
DDA 90A vs 87F
SGA 15A vs 14F
Total Cost: 356A vs 359F (Exlds 21 million gains)
Op income 75A vs 72F
Interest Net -27A vs -30F
IBT 48A vs 42F
Taxes 6A vs 7F
EPS $.40A VS .40F
One time gains 21.1 or $.21 to .22 resulting in a reported $.69
A really good quarter given the state of drilling.
I would expect Q2 to be in the $.32 without one-times and any new contracts.
Not much one small extension at reduced rate and some shipyard dates for a new build going to Australia (the Prosser) to start Sept at $203/day for 18 months. I'll look closer later.
Hmm I wonder if the switch in indexes played into the move as the index holders had to sell short and then deliver the longs they have to the shorts, that is short against the box. Protecting the market value at that time. We might see the short share reduce during the next 15 to 30 days.
The company is managing its working rigs for best outcome, I like. The cc will be a requirement if you are interested in NE from the investment side. As expected the downtime was kept at a lower rate and CD cost was less. We will find out more in the morning.
Its a good day!
Some might begin to cover. The big moves will come when oil move above $80 and PGN receives NEW contracts for any of its rigs owned or under construction. If they can put the 3 Prospectors under construction to work, then game on.
Frog, it looks like a $.23 hit for the year but adds some revenue for 2016. NE might have an error in the dates for 2016, but no material impact on the business. Q2 we are somewhere in the high 50s to low 60s depending on cost structures. I can't get excited about any of the drillers for the rest of 2015, but 2016 is looking up. Rigs are being junked and demand is coming close to supply, oil is on the march to mid 70s or 80 early 2016 which will increase demand for rigs. PEMEX is in trouble. Can't pay for needed services, personnel changes and politics.
If anyone ran out of room stuffing cash in there mattress, might think about buying some drillers at these gift prices.
Looking at the worst possible case for PGN for 2016 and it looks difficult at best. The business model for Jackup drillers is based on short term contracts in shallow waters. These units are generally contracted between 6 and 24 months. The day rates are adjusted each time to the current market conditions and well structures.
I am assuming the whole offshore drilling business has collapsed and we are under some sever world natural event as noted by our leader.
PGN will survive 2015 with a profit and good cash flow noting the debt requirement are met.
PGN for 2016 will also survive but wounded with a 2.00 loss and a 150mm positive cash flow.
I have assumed no new and extended contracts with about the same % rates and cost structure.
Debt payments start in 2019.
CB2527 The "collapse" is based on no future business; yet it keeps coming but at a slower pace and less revenue. The "analyst" or "talkers" have forecasts in the above noted ranges. My post was to quantify, put some numbers to the forecast, to see just what the "talkers" are telling the public what this company and others are going to do.
To get to the "talkers" numbers, you have to eliminate all new and extended contracts, which are not going to happen unless we all begin to live on boats.
The drillers are beginning to get inquiries from the operators on available rigs and rates. This is the first step before tenders begin to arrive from the operators. I say we have bottomed out and are beginning to start the long climb back to "normal" .
They should have about 100mm in cash flow for Q2. If the reset of the quarters come in good, they should be out from under the revolver, if not now. We still have a ways to go in this down cycle.
PGN from the FSR added 3 mm in revenue for the 2nd qtr and $.02 to earnings.
The bottom is starting, then comes more rigs at low rates, then rollovers at higher rates followed with rigs shortages.
HERO is going to file for Chp 11 July 8th giving 97% of the company to debt holders and gain some cash for a new build under construction. PCD is being pursued by ESV, SDRL and RIG for Merger no dice. Only the strong will last, it is getting worse.
If the operators don't wise up soon, they will be hard pressed to get oil from offshore rigs. Maybe "pope/oboma" energy is ready for prime time, a prayer-delusional provides the feeling of moving across the roads and flying the blue heavens on Sprint Air. (:
The changes in maintenance and Danny Boy will add about 11mm to the 2nd qtr revenue and $.02 or so to earnings, or maybe .01 with higher interest expense. I am still looking for high 50s for Q2, from ops. Excluding one time charges. I wonder how much NE will get from the scrap yard for the semi being retired or will China others buy them?
This report will add $100 or so to the 2016 firm contract revenue. Slight revenue and EPS decrease, but rigs are working, that is a good sign, yea at less rate.
Firm revenue for 2015 goes from 1415 to 1414mm. Still holding Q2 EPS in the mid .30s or so.