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Patterson-UTI (PTEN) Posts Narrower-than-Expected Q4 Loss
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Patterson-UTI Energy, Inc. (PTEN - Free Report) recently reported adjusted net loss per share of 57 cents in fourth-quarter 2020, narrower than the Zacks Consensus Estimate of 62 cents. This outperformance reflects better-than-expected sales from the pressure pumping segment. Precisely, revenues from the segment came in at $79.5 million, above the Zacks Consensus Estimate of $79 million.
However, the loss was wider than the year-earlier quarter's bottom line of 44 cents due to lower contribution from contract drilling and directional drilling segments.
Revenues of $221 million beat the Zacks Consensus Estimate of $220 million. The top line, however, declined 55.1% from the year-ago quarter.
Segmental Performance
Contract Drilling: Revenues totaled $115.6 million, down 57.3% year over year. Meanwhile, the unit lost $61.5 million in the fourth quarter, wider than the year-ago loss of $19.5 million, plagued by a fall in both the operating days (from 11,291 to 5,720) and the number of rigs operational (from 122 to 62).
Pressure Pumping: Revenues of $79.5 million dropped 50.8% from the year-ago sales of $161.4 million. Moreover, the segment’s operating loss widened to $31.7 million from $26.6 million in the fourth quarter of 2019, attributable to declined industry completion activity levels in Northeast.
Directional Drilling: Revenues summed $16.9 million, down 56.3% year over year. Moreover, the segment’s operating loss narrowed to $5.7 million from $9.3 million loss in the corresponding quarter of 2019 as a result of cost-control measures and market share gains.
Other Operations: Revenues came in at $8.9 million, 58.7% below the year-ago quarter’s $21.5 million. However, the unit incurred a wider quarterly loss of $6.1 million from $3.01 million loss recorded in the year-ago quarter.
Capital Expenditure & Financial Position
During the quarter, Patterson-UTI spent $10.4 million on capital programs (compared with $64 million in the fourth quarter of 2019). As of Dec 31, 2020, the company had $225 million in cash and cash equivalents and $901.5 million as long-term debt.
This Houston, TX-based companydeclared a quarterly dividend of 2 cents a share, payable Mar 18, 2021 to its shareholders of record as of Mar 4, 2021.
Guidance & Outlook
Based on contracts currently in place, Patterson-UTI anticipates its first-quarter 2021 rig count to average 42 rigs under term contracts. Further, as the onshore driller foresees an improvement in drilling activity, it expects 69 rigs, on average, in the first quarter of 2021, 7% of which will be idle but contracted rigs.
Average rig revenue per day is expected to increase to $21,000 in the first quarter while average rig operating costs are estimated to rise to $14,500 per day in the period.
With regard to 2021 capital spending estimates, the company expects to spend nearly $135 million. Of the total, about $85 million is for contract drilling, $30 million will be invested in pressure pumping while the remainder will be spent on other segments and general corporate purposes.
For the current quarter, the company projects its SG&A expense to be around $23 million while its depreciation, depletion, amortization and impairment expense is estimated at $148 million.
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Patterson-UTI (PTEN) Posts Narrower-than-Expected Q4 Loss
Patterson-UTI Energy, Inc. (PTEN - Free Report) recently reported adjusted net loss per share of 57 cents in fourth-quarter 2020, narrower than the Zacks Consensus Estimate of 62 cents. This outperformance reflects better-than-expected sales from the pressure pumping segment. Precisely, revenues from the segment came in at $79.5 million, above the Zacks Consensus Estimate of $79 million.
However, the loss was wider than the year-earlier quarter's bottom line of 44 cents due to lower contribution from contract drilling and directional drilling segments.
Revenues of $221 million beat the Zacks Consensus Estimate of $220 million. The top line, however, declined 55.1% from the year-ago quarter.
Segmental Performance
Contract Drilling: Revenues totaled $115.6 million, down 57.3% year over year. Meanwhile, the unit lost $61.5 million in the fourth quarter, wider than the year-ago loss of $19.5 million, plagued by a fall in both the operating days (from 11,291 to 5,720) and the number of rigs operational (from 122 to 62).
Pressure Pumping: Revenues of $79.5 million dropped 50.8% from the year-ago sales of $161.4 million. Moreover, the segment’s operating loss widened to $31.7 million from $26.6 million in the fourth quarter of 2019, attributable to declined industry completion activity levels in Northeast.
Directional Drilling: Revenues summed $16.9 million, down 56.3% year over year. Moreover, the segment’s operating loss narrowed to $5.7 million from $9.3 million loss in the corresponding quarter of 2019 as a result of cost-control measures and market share gains.
Other Operations: Revenues came in at $8.9 million, 58.7% below the year-ago quarter’s $21.5 million. However, the unit incurred a wider quarterly loss of $6.1 million from $3.01 million loss recorded in the year-ago quarter.
Capital Expenditure & Financial Position
During the quarter, Patterson-UTI spent $10.4 million on capital programs (compared with $64 million in the fourth quarter of 2019). As of Dec 31, 2020, the company had $225 million in cash and cash equivalents and $901.5 million as long-term debt.
This Houston, TX-based companydeclared a quarterly dividend of 2 cents a share, payable Mar 18, 2021 to its shareholders of record as of Mar 4, 2021.
Guidance & Outlook
Based on contracts currently in place, Patterson-UTI anticipates its first-quarter 2021 rig count to average 42 rigs under term contracts. Further, as the onshore driller foresees an improvement in drilling activity, it expects 69 rigs, on average, in the first quarter of 2021, 7% of which will be idle but contracted rigs.
Average rig revenue per day is expected to increase to $21,000 in the first quarter while average rig operating costs are estimated to rise to $14,500 per day in the period.
With regard to 2021 capital spending estimates, the company expects to spend nearly $135 million. Of the total, about $85 million is for contract drilling, $30 million will be invested in pressure pumping while the remainder will be spent on other segments and general corporate purposes.
For the current quarter, the company projects its SG&A expense to be around $23 million while its depreciation, depletion, amortization and impairment expense is estimated at $148 million.
Zacks Rank & Key Picks
Patterson-UTI currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space are DCP Midstream Partners, LP , Plains Group Holdings, L.P. (PAGP - Free Report) and Matador Resources Co. (MTDR - Free Report) , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>