Ocean Rig UDW Inc. Reports Financial and Operating Results for the Third Quarter 2013
(firmenpresse) - NICOSIA, CYPRUS -- (Marketwired) -- 11/04/13 -- Ocean Rig UDW Inc. (NASDAQ: ORIG), or Ocean Rig or the Company, an international contractor of offshore deepwater drilling services today announced its unaudited financial and operating results for the third quarter ended September 30, 2013.
For the third quarter of 2013, the Company reported a net loss of $21.5 million, or $0.16 basic and diluted loss per share.
Included in the third quarter 2013 results are:
Non-cash write offs and breakage costs associated with the full repayment of the $800.0 million secured term loan agreement and the two $495.0 million senior secured credit facilities totaling $61.1 million or $0.46 per share.
Excluding the above item, the Company's net results would have amounted to a net income of $39.6 million, or $0.30 per share.
The Company reported Adjusted EBITDA of $161.4 million for the third quarter of 2013, as compared to $122.5 million for the third quarter of 2012. (1)
Achieved 98.4% average fleet wide operating performance for the third quarter of 2013.
On November 4, 2013, the Ocean Rig Mylos commenced drilling operations under the three year contract with Repsol Sinopec Brazil S.A.
The deliveries of the newbuildings Ocean Rig Skyros and Ocean Rig Athena are rescheduled for January 2014 and February 2014 respectively, due to the late delivery of third party and sub-supplier equipment.
On October 29, 2013, we agreed with a major oil company to extend for 60 days the expiration of the previously announced Letter of Award for our ultra deepwater drillship Ocean Rig Skyros.
George Economou, Chairman and Chief Executive Officer of the Company commented:
"We are very pleased with the 98.4% average operating efficiency of our fleet in the third quarter. Although unscheduled rig downtime is an unavoidable industry fact, our consistent efforts over the past year and our ongoing focus on operational excellence have resulted in three consecutive quarters of strong performance. We remain dedicated to our plan of becoming the preferred drilling contractor for our clients.
"In August we took delivery of the Ocean Rig Mylos, the first of our three 7th generation drillships being delivered in the coming months. I am very pleased to announce that the Ocean Rig Mylos mobilized to Brazil in record time, underwent a very smooth acceptance process and commenced drilling operations this week. At the same time, the scheduled delivery of the Ocean Rig Skyros and Ocean Rig Athena has unfortunately slipped to January and February 2014 due to the late delivery of third party and sub-supplier equipment. I note that the late delivery of the drillships has no negative implication under their respective employment contracts.
"During the third quarter, and as previously announced, we successfully completed the refinancing of the Nordea and Deutsche Bank facilities with a new $1.9 billion senior secured term loan facility comprised of two term loans. In addition we drew down $450 million under the $1.35 billion Bank/ECA facility, to finance the acquisition of Ocean Rig Mylos and agreed with the syndicate of commercial banks and export credit agencies to amend certain provisions of this facility to allow for incremental financial flexibility.
"Following the conclusion of several of our key strategic objectives, our focus now turns to implementing our value creation initiatives for our stakeholders. We are commencing the creation of a new Master Limited Partnership (MLP) subsidiary with a targeted Initial Public Offering (IPO) launch date within the second quarter of 2014. In addition we plan to initiate a quarterly dividend of $25 million starting with cashflow from our first quarter 2014 operations and payable in mid May 2014."
The Company recorded a net loss of $21.5 million, or $0.16 basic and diluted loss per share, for the three-month period ended September 30, 2013, as compared to a net loss of $12.2 million, or $0.09 basic and diluted losses per share, for the three-month period ended September 30, 2012. Adjusted EBITDA was $161.4 million for the third quarter of 2013, as compared to $122.5 million for the same period in 2012. (2)
Revenues from drilling contracts increased by $42.8 million to $328.5 million for the three-month period ended September 30, 2013, as compared to $285.7 million for the same period in 2012.
Rig operating expenses decreased to $128.9 million and total depreciation and amortization increased to $61.2 million for the three-month period ended September 30 2013, from $160.1 million and $56.5 million, respectively, for the three-month period ended September 30, 2012. Total general and administrative expenses increased to $39.6 million in the third quarter of 2013 from $20.4 million during the comparative period in 2012.
(1) Adjusted EBITDA is a non-GAAP measure; please see later in this press release for reconciliation to net income.
(2) Adjusted EBITDA is a non-GAAP measure; please see later in this press release for reconciliation to net income.
The table below describes our fleet profile and drilling contract backlog as of October 31, 2013:
(1) Letter of Award is subject to definitive documentation and other approvals.
Adjusted EBITDA represents earnings before interest, taxes, depreciation and amortization, class survey costs and gains or losses on interest rate swaps. Adjusted EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is included herein because it is a basis upon which the Company measures its operations and efficiency. Adjusted EBITDA is also used by our lenders as a measure of our compliance with certain covenants contained in our loan agreements and because the Company believes that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness.
The following table reconciles net income/ (loss) to Adjusted EBITDA:
The Leiv Eiriksson is currently drilling offshore Norway under our three-year contract with Rig Management Norway. During the third quarter of 2013, the unit achieved approximately 100% operating efficiency (defined as revenue earnings days over available drilling days).
Following the completion of the ExxonMobil contract, the Eirik Raude mobilized for approximately 23 days from Ireland to offshore West Africa and commenced the six well contract with Lukoil on August 21, 2013. During the mobilization period the Eirik Raude was earning zero revenue and the majority of the operating expenses relating to the unit incurred during this period were capitalized. During the third quarter of 2013, the unit achieved approximately 100% operating efficiency.
As announced, the Company's management team will host a conference call, on Tuesday, November 5, 2013 at 8:00 a.m. Eastern Standard Time to discuss the Company's financial results.
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329 (from the UK) or +(44) (0) 1452 542 301 (from outside the US). Please quote "Ocean Rig"
A replay of the conference call will be available until November 12, 2013. The United States replay number is 1(866) 247-4222; from the UK 0(800) 953-1533; the standard international replay number is (+44) (0) 1452 550 000 and the access code required for the replay is: 55592075#.
A replay of the conference call will also be available on the Company's website at under the Investor Relations section.
There will also be a simultaneous live webcast over the Internet, through the Ocean Rig UDW Inc. website . Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.
Ocean Rig is an international offshore drilling contractor providing oilfield services for offshore oil and gas exploration, development and production drilling, and specializing in the ultra-deepwater and harsh-environment segment of the offshore drilling industry. The company owns and operates 11 offshore ultra deepwater drilling units, comprising of 2 ultra deepwater semisubmersible drilling rigs and 9 ultra deepwater drillships, 2 of which are scheduled to be delivered to the Company during 2014 and 2 of which are scheduled to be delivered during 2015.
Ocean Rig's common stock is listed on the NASDAQ Global Select Market where it trades under the symbol "ORIG".
Visit the Company's website at
Matters discussed in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with such safe harbor legislation.
Forward- looking statements relate to Ocean Rig's expectations, beliefs, intentions or strategies regarding the future. These statements may be identified by the use of words like "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "project," "should," "seek," and similar expressions. Forward-looking statements reflect Ocean Rig's current views and assumptions with respect to future events and are subject to risks and uncertainties.
The forward-looking statements in this release are based upon various assumptions, may of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in Ocean Rig's records and other data available from third parties. Although Ocean Rig believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond Ocean Rig's control, Ocean Rig cannot assure you that it will achieve or accomplish these expectations, beliefs or projections described in the forward- looking statements contained herein. Actual and future results and trends could differ materially from those set forth in such statements.
Important factors that, in Ocean Rig's view, could cause actual results to differ materially from those discussed in the forward-looking statements include (i) factors related to the offshore drilling market, including supply and demand, utilization, day rates and customer drilling programs; (ii);hazards inherent in the drilling industry and marine operations causing personal injury or loss of life, severe damage to or destruction of property and equipment, pollution or environmental damage, claims by third parties or customers and suspension of operations; (iii) changes in laws and governmental regulations, particularly with respect to environmental matters; (iv) the availability of competing offshore drilling vessels; (v) political and other uncertainties, including risks of terrorist acts, war and civil disturbances; piracy; significant governmental influence over many aspects of local economies, seizure; nationalization or expropriation of property or equipment; repudiation, nullification, modification or renegotiation of contracts; limitations on insurance coverage, such as war risk coverage, in certain areas; political unrest; foreign and U.S. monetary policy and foreign currency fluctuations and devaluations; the inability to repatriate income or capital; complications associated with repairing and replacing equipment in remote locations; import-export quotas, wage and price controls imposition of trade barriers; regulatory or financial requirements to comply with foreign bureaucratic actions; changing taxation policies; and other forms of government regulation and economic conditions that are beyond our control; (vi) the performance of our rigs; (vii) our ability to procure or have access to financing and comply with our loan covenants; (viii) our ability to successfully employ our drilling units; (ix) our capital expenditures, including the timing and cost of completion of capital projects; and (x) our revenues and expenses. Due to such uncertainties and risks, investors are cautioned not to place undue reliance upon such forward-looking statements.
Risks and uncertainties are further described in reports filed by Ocean Rig UDW Inc. with the U.S. Securities and Exchange Commission.
Nicolas Bornozis
Capital Link, Inc. (New York)
Tel. 212-661-7566
E-mail:
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Datum: 04.11.2013 - 15:05 Uhr
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