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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Sunny Jim who wrote (30736)	10/15/1998 2:28:00 PM
From: RGinPG	Respond to of 95453

GLM missed earnings estimates by 10% (est = $0.30 per share vs actual $0.27 per share) That's after a 40% drop in earnings estimates over the last 4 mths. I knew there was a reason I didn't like this company. osxstocks.com infoseek.com Global Marine's earnings fall as oil slump bites 02:57 p.m Oct 14, 1998 Eastern By Andrew Kelly HOUSTON (Reuters) - Global Marine Inc., one of the world's biggest operators of offshore drilling rigs, reported a 40 percent drop in third-quarter earnings on Wednesday as the global slump in oil prices hit its bottom line. Net income fell to $47.2 million, or 27 cents per diluted share, from $78.4 million, or 44 cents, in the year-earlier quarter. Earnings per share were a penny below the Wall Street consensus, and the stock fell 44 cents to $9.69 in midafternoon trading on the New York Stock Exchange. Global's contract drilling operations posted higher profits as average daily rental rates for Global Marine's fleet of 31 rigs rose to $72,100 from $59,300, even though the fleet's utilization rate slipped to 93 percent from 99 percent. However, the company's ''turnkey'' drilling business, which generated $50 million in profits last year, showed a $20 million loss, dragging down overall earnings for the latest quarter. In the contract market, drillers agree to provide a rig and crew at an agreed daily rate to an oil and gas exploration company, which retains overall responsibility for the well. In the turnkey market, generally perceived as riskier, drillers assume responsibility for the drilling program and agree to complete it at a pre-arranged all-in price. The turnkey market is mainly concentrated in the shallow waters of the Gulf of Mexico, an area that has experienced some of the biggest drops in drilling activity and daily rates since the long decline in crude oil prices began late last year. Global Marine had 13 third-party rigs under contract for turnkey work in the third quarter, but five remained idle amid slack demand from exploration firms. Chief Executive Bob Rose said the turnkey problems would persist into the first quarter when current contracts expired, but added that the unit would probably win more business in the fourth quarter than in the third, when it drilled only 12 wells. PaineWebber analyst Terry Darling said Global Marine had slipped up this time but had previously shown it could create value in the turnkey market where most others found problems. ''If you look at Global Marine's track record on a longer-term basis, they are an exception to that rule,'' he said. Rose was cautious in his comments about the prospects for a broader market recovery but did allude to ''positive signs'' such as a rise in customer inquiries about possible turnkey projects. ''That tends to bode well for activity levels improving....We have put a couple of rigs back to work that had been idle. That also gives me some encouragement that perhaps we're seeing an improvement in the market,'' he told a conference call. Rose said he was ''very optimistic'' about deepwater markets, which currently generate half of the company's operating income. Despite lower oil and gas prices, exploration companies have generally maintained efforts to find and develop new deepwater reserves, which are among the most lucrative in the world.