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Leading contract drilling company, Noble Corporation (NE - Analyst Report) reported first quarter 2013 earnings of 59 cents per share. With a boost from multi-regional operational improvements, the results surpassed both the Zacks Consensus Estimate of 57 cents and year-ago earnings of 47 cents.

Total revenue in the quarter rose 21.7% to almost $971.0 million from $797.7 million in the comparable quarter last year. However, the top line failed to meet the Zacks Consensus Estimate of $989.0 million. Contract Drilling Services contributed $928.7 million to the total revenue, reflecting a year-over-year increase of 24.4% mainly on improved fleet utilization and higher average dayrates.

First Quarter Operating Highlights

Total operating income shot up almost 60% to $229.8 million from the year-ago level of $143.6 million. Operating income from the Contract Drilling segment rose 60.5% year over year to $225.1 million from $140.3 million.

Total rig utilization improved to 86% from the year-earlier level of 74%. The overall average dayrate surged 4.5% to $174,578 from $167,124 in the year-ago quarter.

The average dayrate for semisubmersible rigs registered about a 9.6% year-over-year fall to $321,037. Average capacity utilization was 84% versus 86% in the year-ago period.

The average dayrate for Drillships rose about 13.1% year-over-year to $315,216. Average capacity utilization was 83% versus 51% in the year-ago period.

The average dayrate for the company's jackups was $105,559 compared with $90,382 in the year-ago quarter. Average capacity utilization increased to 93% from the year-ago level of 79%.

The company has 74% of all rig days committed for this year, including 79% of floating rig days and 76% of jackup rig days. For 2014, 55% of the rig days are booked, comprising 71% of the floater time and 50% of the jackup rig days. Overall total backlog at the end of the first quarter was approximately $14.0 billion versus $14.3 billion as of year-end 2012.

Financials

At the end of the first quarter, the company had a cash balance of $214.5 million and long-term debt of $4,844.2 million, with debt-to-capitalization ratio of 36% (versus 35% at year-end 2012). In the reported quarter, Noble invested $372 million in capital projects.

Our Take

Noble Corporation is a leading offshore drilling contractor and provider of diversified services for the oil and gas industry.
 

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