We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Helmerich & Payne (HP) Q3 Loss Lower Than Expected, Sales Top
Read MoreHide Full Article
Contract drilling services provider Helmerich & Payne Inc. (HP - Free Report) reported net operating loss per share for the third quarter of fiscal 2017 – excluding special items – of 18 cents, narrower than the Zacks Consensus Estimate of a loss of 31 cents. The better-than-expected results can be attributed to higher drilling activities, especially in the North American markets. Increased rig margins and operating income from the offshore and international markets also provided an impetus to the results. The bottom line also compares favorably with the year-ago adjusted loss of 47 cents
Revenues of $498.5 million were up 36% from the fiscal third quarter of 2016 and surpassed the Zacks Consensus Estimate of $440 million.
Helmerich & Payne, Inc. Price, Consensus and EPS Surprise
U.S. Land: During the quarter, operating revenues totaled $405.5 million (81% of total revenue), up 42.3% year over year. The average rig revenue per operating day was $21,986, 38% below the year-ago period and average rig margin per day was down 64% to $7,730. Utilization levels increased to 52% (from 24% in the fiscal third quarter of 2016). The segment recorded an operating loss of $8 million. In the year-ago quarter, income from the unit was $25.8 million.
Offshore:Helmerich & Payne’s offshore revenues were up 10.5% year over year to $33.7 million. Daily average rig revenue rose 39.4% to $35,644 and average rig margin per day jumped 70.5% to $11,503. These positive factors led to the segment operating income of $6.4million, up 209% from the prior-year recorded figure of $2.1 million. However, rig utilization declined to 75% from the year-ago level of 78%.
International Land: Helmerich & Payne’s International Land operations recorded revenues of $55.1 million, up from $48 million in the prior-year quarter. Average daily rig revenue was $32,708, down 5.7% from the corresponding period last year, while rig margin per day was $13,063, higher than the $8,537 earned a year ago. Rig utilization was up to 47% compared with 37% in the prior-year quarter. The segment reported an operating income of $4.9 million, as against the loss of $5 million in the year-ago quarter.
Balance Sheet
As of Jun 30, 2017, the company had approximately $572.8 million in cash, while long-term debt was $492.6 million (debt-to-capitalization ratio of 10.4%).
Updated Guidance
The estimated capex budget for 2017 ha been increased to $400 million from $350 million to take into account the upgradation of more than expected rigs. The projected general and administrative expenses has been increased to $150 million primarily due to the acquisition of MOTIVE Drilling Technologies, Inc. and to support a much higher active rig count than originally anticipated.
Zacks Rank and Key Picks
Helmerich & Payne is a major land and offshore drilling contractor in the western hemisphere with the youngest but the most efficient drilling fleet. The company specializes in shallow to deep drilling in oil and gas-producing U.S. basins. The company currently carries a Zacks Rank #3 (Hold).
Braskem reported an average positive earnings surprise of 107.79% in the trailing four quarters.
Petrobras delivered an average positive earnings surprise of 59.58% in the last four quarters.
SeaDrill reported an average positive earnings surprise of 97.13% in the last four quarters.
More Stock News: Tech Opportunity Worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential. See these stocks now>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Helmerich & Payne (HP) Q3 Loss Lower Than Expected, Sales Top
Contract drilling services provider Helmerich & Payne Inc. (HP - Free Report) reported net operating loss per share for the third quarter of fiscal 2017 – excluding special items – of 18 cents, narrower than the Zacks Consensus Estimate of a loss of 31 cents. The better-than-expected results can be attributed to higher drilling activities, especially in the North American markets. Increased rig margins and operating income from the offshore and international markets also provided an impetus to the results. The bottom line also compares favorably with the year-ago adjusted loss of 47 cents
Revenues of $498.5 million were up 36% from the fiscal third quarter of 2016 and surpassed the Zacks Consensus Estimate of $440 million.
Helmerich & Payne, Inc. Price, Consensus and EPS Surprise
Helmerich & Payne, Inc. Price, Consensus and EPS Surprise | Helmerich & Payne, Inc. Quote
Segment Performance
U.S. Land: During the quarter, operating revenues totaled $405.5 million (81% of total revenue), up 42.3% year over year. The average rig revenue per operating day was $21,986, 38% below the year-ago period and average rig margin per day was down 64% to $7,730. Utilization levels increased to 52% (from 24% in the fiscal third quarter of 2016). The segment recorded an operating loss of $8 million. In the year-ago quarter, income from the unit was $25.8 million.
Offshore:Helmerich & Payne’s offshore revenues were up 10.5% year over year to $33.7 million. Daily average rig revenue rose 39.4% to $35,644 and average rig margin per day jumped 70.5% to $11,503. These positive factors led to the segment operating income of $6.4million, up 209% from the prior-year recorded figure of $2.1 million. However, rig utilization declined to 75% from the year-ago level of 78%.
International Land: Helmerich & Payne’s International Land operations recorded revenues of $55.1 million, up from $48 million in the prior-year quarter. Average daily rig revenue was $32,708, down 5.7% from the corresponding period last year, while rig margin per day was $13,063, higher than the $8,537 earned a year ago. Rig utilization was up to 47% compared with 37% in the prior-year quarter. The segment reported an operating income of $4.9 million, as against the loss of $5 million in the year-ago quarter.
Balance Sheet
As of Jun 30, 2017, the company had approximately $572.8 million in cash, while long-term debt was $492.6 million (debt-to-capitalization ratio of 10.4%).
Updated Guidance
The estimated capex budget for 2017 ha been increased to $400 million from $350 million to take into account the upgradation of more than expected rigs. The projected general and administrative expenses has been increased to $150 million primarily due to the acquisition of MOTIVE Drilling Technologies, Inc. and to support a much higher active rig count than originally anticipated.
Zacks Rank and Key Picks
Helmerich & Payne is a major land and offshore drilling contractor in the western hemisphere with the youngest but the most efficient drilling fleet. The company specializes in shallow to deep drilling in oil and gas-producing U.S. basins. The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked players from the broader energy space include Braskem S.A. (BAK - Free Report) , Petróleo Brasileiro S.A. or Petrobras (PBR - Free Report) and SeaDrill Limited (SDRL - Free Report) . While Braskem and Petrobras sport a Zacks Rank #1 (Strong Buy), SeaDrill carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Braskem reported an average positive earnings surprise of 107.79% in the trailing four quarters.
Petrobras delivered an average positive earnings surprise of 59.58% in the last four quarters.
SeaDrill reported an average positive earnings surprise of 97.13% in the last four quarters.
More Stock News: Tech Opportunity Worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential. See these stocks now>>