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Tidewater 3Q profit falls on special charge

NEW ORLEANS (AP) -- Tidewater Inc., which operates an offshore drilling fleet, said on Friday that its third-quarter net income fell 12 percent because of special charges.

The company earned $29.9 million, or 61 cents per share, for the quarter that ended Dec. 31. That was down from $34.1 million, or 67 cents per share, during the same period a year earlier.

The number of outstanding shares was 3 percent lower in the recent quarter, which boosted per-share results

It took a special charge of 7 cents per share in the most recent quarter because accounting issues related to a lump-sum retirement plan payout to its former CEO, who retired earlier in the year. Also, its year-ago quarter was inflated by 16 cents per share because of tax issues. If not for those two items, profit in the most recent quarter would have been higher than a year earlier.

Wall Street was expecting, on average, earnings of 46 cents per share, according to data provider FactSet.

Revenue rose 14 percent to $309.5 million, from $272.1 million a year earlier. Revenue was slightly higher than the $305.5 million, on average, expected by analysts.

Geographically, its adjusted operating profits grew strongly in the Middle East and North Africa, offsetting declines elsewhere. Utilization of that fleet jumped nearly 10 percentage points to 75.1 percent, compared with much smaller shifts in fleet utilization in other parts of the world.

Tidewater "posted what we believe could be a breakout quarter for the company, with clean results far exceeding expectations," wrote Mark Brown, an analyst with Citi Investment Research, in a note to investors. He said the results were driven by solid performance in vessel operating costs and strong revenue from its operations in the Middle East, North Africa and the Americas.

Brown kept a "buy" rating on the stock, with a target price of $62.

Shares slid 92 cents, or 2 percent, to $48.25 in morning trading.