Maersk Drilling navigates low visibility in the market

Offshore staff

HOUSTON – Maersk Drilling delivered a profit of $218 million in the second quarter of 2015. The result was positively impacted by continued strong operational performance, fleet growth, general cost savings and a $29-million payment related to the divestment of the Venezuelan activities in 2014. The result was negatively impacted by three rigs being idle.

“We are very pleased with the result given the adverse market conditions. Our focus on operational performance and cost savings continue to pay off and it enhanced our strong foundation for our future competitiveness. Meanwhile, we continue to improve our safety performance,” says Claus V. Hemmingsen, CEO in Maersk Drilling and member of the executive board in the Maersk Group.

At the end of 2Q 2015, Maersk Drilling’s forward contract coverage was 83% for the rest of 2015, 61% for 2016, and 32% in 2017. The total revenue backlog by the end of 2Q 2015 amounted to $5.3 billion. In addition, in July and August the company secured additional contracts, adding more than $660 million to the backlog.

“We are proud that we are able to continue to strengthen our backlog in the challenging market,” says Hemmingsen.

Maersk Drilling expects a significantly higher underlying result for 2015 than in 2014 due to more rigs in operation, solid forward contract coverage for the rest of the year, as well as the initiated cost reduction and efficiency enhancement program, which delivered a saving of 5% excluding positive rate of exchange effects on the operating cost level compared to 2Q 2014.

Facts about 2Q 2015 performance:

•      Profit of $218 million ($117 million)

•      ROIC was 10.6% (7.2 %)

•      Operational uptime averaged 97%.

 

08/14/2015

 

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