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UPDATE 1-Ensco profit rises on increased offshore drilling rates
October 23, 2013 / 11:47 PM / 4 years ago

UPDATE 1-Ensco profit rises on increased offshore drilling rates

Oct 23 (Reuters) - Offshore drilling contractor Ensco Plc reported on Wednesday a larger-than-expected rise in quarterly profit as rig rates increased, even as utilization of its most-valuable drillers declined from the year before.

Third-quarter net profit climbed 10 percent to $379 million, or $1.62 per share, from $344 million, or $1.48 per share, a year ago. Revenue rose 13 percent to $1.27 billion.

Leaving out one-time charges and gains, Ensco earned a profit of $1.69 per share, compared with the $1.61 expected by analysts on average, according to Thomson Reuters I/B/E/S.

Nearly two-thirds of Ensco revenue came from floating rigs, which are capable of drilling in deeper waters. Utilization - measuring the number of days those rigs are under contract out of the number of days in total - declined for floating rigs to 79 percent in the quarter from 90 percent a year before.

Ensco’s fleet is of similar size to that of Noble Corp and about a dozen shy of the largest fleet, owned by Transocean Ltd, which now has 80 units. Rival Diamond Offshore Drilling Inc is due to report results on Thursday.

Noble also reported higher-than-expected quarterly profits earlier this month, lifted by improved dayrates and better utilization of its fleet.

Shares of Ensco and Diamond have both declined by 7 percent so far in 2013, whereas Transocean’s are up 10 percent and Noble’s up 9 percent. Shares of the most valuable offshore driller, Seadrill, have gained 25 percent in 2013.

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