Back to top

Analyst Blog

Offshore drilling giant, Transocean Ltd. (RIG - Analyst Report), reported in-line second-quarter 2013 earnings, favored by better utilization of rigs.

Earnings per share (excluding special items) came in at $1.08, in line with the Zacks Consensus Estimate. The figure came ahead of the year-ago adjusted profit of 89 cents.


Total quarterly revenue of $2,397.0 million surpassed the Zacks Consensus Estimate of $2,383.0 million. Comparing year over year, revenues were up 2.9% mainly attributed to higher average dayrates from high-specification floaters, high-spec jackups and midwater floaters.    

Transocean's high-spec floaters contributed approximately 74.1% to the total revenue, while mid-water floaters and high-spec jackup rigs accounted for 15.9% and 6.6% of the total revenue, respectively. The remaining revenues came from other rig activities, integrated services and others.

Operating Statistics

Transocean posted operating income of $602.0 million during the quarter compared with a loss of $142.0 million in the year-ago period. Total operating and maintenance expenses decreased 33.8% to $1,393.0 million.  

Dayrates & Utilization

Total average dayrates have increased to $382,900 in this quarter as compared to $371,000 in the second quarter of 2012. The increase is favored by higher day rates from high-specification jackups, midwater floaters and high-specification floaters.

Overall fleet utilization was 80%, up from the year-ago utilization rate of 77%.

Capital Expenditure & Balance Sheet

Capital expenditures during the quarter totaled $352.0 million.

As of Jun 30, 2013, Transocean had cash and cash equivalents of $3,357.0 million and long-term debt of $10,460.0 million (representing a debt-to-capitalization ratio of approximately 40.0%).   

Zacks Rating

Transocean currently retains a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S equity market over the next one to three months.

Meanwhile, one can look at oil and pipeline master limited partnerships (MLP) like Delek Logistics Partners LP (DKL - Snapshot Report), Pioneer Southwest Energy Partners LP and Magellan Midstream Partners LP (MMP - Analyst Report) that offer value. All the stocks currently retain a Zacks Rank #2 (Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SIGNET JEWE… SIG 116.37 +7.72%
CHYRONHEGO… CHYR 2.72 +5.84%
US SILICA H… SLCA 70.72 +4.00%
MALLINCKROD… MNK 80.11 +2.32%
RF MICRO DE… RFMD 11.76 +2.31%