Pride Petroleum Services (PDE) Message Board

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Gold/Mining/Energy : Pride Petroleum Services (PDE)

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From: Dennis Roth	5/9/2007 5:08:27 AM
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Pride International (PDE): First Take: Offshore operating results in line Goldman Sachs Global Investment Research Note Stock rating: Neutral Coverage view: Neutral Price: US$34.06 May 8, 2007 United States News Pride's recurring estimate of $0.60 operating income was $0.57-$0.60. 1Q2007 EPS of $0.58 was in line with consensus and just below our due mostly to lower Latin American Land, E&P Services and Other (-$0.04 EPS impact), offset by lower taxes (+$0.02). 1Q2007 guidance Recurring operating income was 5% below our model. Analysis Offshore drilling operating income was in line with our estimate as higher revenues were offset by higher operating costs. Drivers of variance to our estimates included: (1) 7% lower than expected Latin American Land operating income (-$0.01); (2) lower E&P Services operating income (-$0.01); (3) lower operating income from Other (-$0.02), offset by (4) a lower tax rate (+$0.02). Implications Pride was originally supposed to reported 1Q earnings on May 2nd, but on that date the company rescheduled its release to May 10th. The postponement generated a lot of speculation but Pride did not address the reason for the delay in yesterday's press release. We think this suggests that the reason for the delay was minor. This should be a key topic for the conference call. Pride stated in its earnings release that day rates in the US Gulf of Mexico appear to be stabilizing and there is the potential to experience a modest improvement in dayrates during late 2007 or early 2008. We agree with these comments but believe there is still uncertainty surrounding hurricane season as well as natural gas prices in the near-term.

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