To All:
Some information. I just got Rowan's 9 Month Interim Report last night dated 11/3/97. Here are some excerpts:
The Past:
"The 1997 third quarter net income of $54.3 million, or $.61 per share, was the best quarterly results in the Company's history and compares to net income of $22.7 million, or $.26 per share, for the third quarter of 1996."
"Drilling revenues increased by 50%..."
"...The 167% [operating profit] improvement is a result of increased day rates and improved rig activity levels."
"...The company's land rig activity improved to 44% during the third quarter of 1997 from 39% during the second quarter. [...] Day rates continue to improve with each contract renewal."
"The [Manufacturing] division's external backlog at September 30, 1997 was about $71 million, a $10 million increase during the quarter."
"The overall construction [of Rowan Gorilla V] is on track to deliver the rig on time and within budget."
"With the demand for flying services for the energy industry in the Gulf of Mexico improving, [...] the aviation division implemented an 18% to 20% increase in its Gulf of Mexico flying rates."
The Future:
"The Company anticipates the average day rate for its offshore rigs during the fourth quarter of 1997 will increase by about $3,500."
"The Company anticipates the average day rate for its land rigs during the fourth quarter of 1997 will be about $9000." [up from $8,800 third quarter]
"Our financial goals for 1997 have been increased to $685 million in consolidated revenues and net income approaching $155 million, or $1.73 per share before and extraordinary charge net of income taxes from redemption of debt of $9.8 million. The outlook for 1998 is for revenues to exceed $850 million producing net income approaching $255 million, or $2.50 per share. Improvements are expected in all three divisions." [Drilling, Manufacturing, Aviation]
"The Company has contracts providing an average increase of about 50% in 1998 for the four LeTourneau 116-C jack-ups in the North Sea."
"Rowan Gorilla II has a contract offshore eastern Canada beginning in the second quarter 1998 with a 60% increase in day rate."
"Solid demand and a declining supply will continue to improve rates of the other offshore rigs."
And on, and on...
Another interesting comment:
"When peak rates are achieved, growth in earnings can come only from increasing the asset base. Planned capital expenditures under our current business plan of $750 million from 1996 through the year 2000 should provide this growth."
"Our goal for the year 2000 is for revenues to exceed $1.2 billion and net income to approach $400 million, or about $4.50 per share."
Uh, oh. Time to sell. Or maybe short?
Alan |
