Rowan Companies plc’s (RDC) adjusted fourth-quarter 2014 earnings from continuing operations came in at 89 cents per share, which missed the Zacks Consensus Estimate of 90 cents. Earnings, however, increased from the adjusted year-ago profit level of 42 cents.
Total revenue grew 41.4% year over year to $556.2 million in the reported quarter and beat our expectation of $530.0 million. The growth was mainly attributable to higher average dayrates, increased activity from fleet additions and less out-of-service time for jack-up rigs.
Full-year 2014 adjusted earnings of $2.14 per share met the Zacks Consensus Estimate but increased 9.7% from the year-ago adjusted profit level of $1.95 per share.
Total revenue in 2014 improved 15.5% on a year-over-year basis to $1,824.4 million and also beat the Zacks Consensus Estimate of $1,799.0 million.
Dayrates and Utilization
The company’s Gulf of Mexico rigs reported a dayrate of $150,100 ($143,400 in the year-ago quarter), Middle East rigs saw a dayrate of $145,800 ($135,600 a year ago) and North Sea rigs’ dayrate was $306,400 ($284,000 in the year-ago quarter).
The overall dayrate of all offshore rigs was $185,200 ($168,400 in fourth-quarter 2013). Average utilization of the company’s rigs improved to 86% from 83% in the year-earlier quarter.
Financials
As of Dec 31, 2014, the cash balance was $339.2 million and long-term debt (including current maturities) was $2,807.3 million. The debt-to-capitalization ratio was 37.4% compared with 29.1% in the prior quarter.
Ranks
Rowan carries a Zacks Rank #5 (Strong Sell). Better-ranked players from the oil and gas industry include Valero Energy Partners L.P. (VLP), Golar Energy Partners LP (GMLP) and Hallador Energy Company (HNRG). Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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