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Noble (NE) Q4 Loss Narrower than Expected; Revenues Beat

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Leading contract drilling company Noble Corporation (NE - Free Report) reported fourth-quarter 2016 loss of 15 cents per share, narrower than the Zacks Consensus Estimate of a loss of 23 cents per share. The quarterly results also compared unfavorably with the year-ago quarter earnings of 52 cents per share.

Total revenue in the quarter declined to $410.2 million from $857.7 million in the comparable quarter last year. The quarterly revenues, however, beat the Zacks Consensus Estimate of $397.91 million. Contract Drilling Services plunged 52.1% year over year and contributed $400.9 million to the total revenue.

Full-year 2016 loss came in at 5 cents per share, narrower than the Zacks Consensus Estimate of a loss of 13 cents. Noble posted earnings of $2.59 per share in 2015.

Total revenue for the full year decreased to $2,302.1 million from $3,352.2 million in 2015. Nonetheless, it surpassed the Zacks Consensus Estimate of $1,943.0 million.

Fourth-Quarter Operating Highlights

Net loss from continuing operations was $1,283.2 million, much wider than the net loss of $102.9 million in the fourth quarter of 2015. Total rig utilization decreased to 62% from the year-earlier level of 83%. The overall average dayrate declined to $238,704 from $367,953 in the year-ago quarter.

The average dayrate for drillships of $474,462 was substantially lower than $672,972 a year ago. Average capacity utilization was 73% compared with 99% in the prior-year period.

The average dayrate for the company's jackups was $124,470 as against $145,283 in the prior-year quarter. Average capacity utilization decreased to 86% from the year-ago level of 82%.

The average dayrate for the company's semi-submersibles was $166,253 compared with $315,459 in the prior-year quarter. Average capacity utilization plummeted to 13% from the year-ago level of 67%.

As of Dec 31, 2016, the company had 52% of available rig operating days committed for 2017, which included 33% floating rig days and 71% jackup rig days. For 2018, an estimated 32% of available rig operating days are committed. This consists of 29% and 36% floating and jackup rig days, respectively.

Backlog

As of Dec 31, 2016, total backlog was approximately $3.3 billion. Of this, about $2.3 billion relates to floating rig fleet and $1 billion pertains to jackup fleet.

Noble Corporation Price, Consensus and EPS Surprise

 

Noble Corporation Price, Consensus and EPS Surprise | Noble Corporation Quote

Financials

At the end of the reported quarter, the company had a cash balance of $725.7 million and long-term debt of $4,040.2 million, with debt-to-capitalization ratio of 38.4% compared with 33.1% in the preceding quarter.

Zacks Rank

Noble Corp. currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the same space include Denbury Resources Inc. , Holly Energy Partners LP and Sunrun Inc. (RUN - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Denbury Resources posted a positive earnings surprise of 100.00% in the last reported quarter. It had an average earnings surprise of 283.33% in the four trailing quarters.

Holly Energy Partners posted a negative earnings surprise of 23.26% in the preceding quarter. It had an average negative earnings surprise of 0.96% in the four trailing quarters.

Sunrun posted a positive earnings surprise of 137.21% in the preceding quarter. It beat estimates in all the four preceding quarters and has an average positive earnings surprise of 134.71% in the four trailing quarters.

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