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Got a Buy recommendation today ($12.00). Kurt Hallead Benchmark CO. analyst
I expect to see revenue growth. Hoping for 15%. However, that will be contingent on their day rates, and I don't know how they are set and whether the increase in BNSC & WTI will filter down to them.
So 3q filings should be out around 10-1. I dont think it will be very exciting but 4q or end of year should be fun. Just wondering how you and others feel
Looks to me like RIG bought out Perestroika and Lime Rock Partners interests in Liquila Ventures Ltd. with shares. (don't know if I'm stating the obvious)
Motherlode. Thankyou for your informative posts. I have trouble finding information about transocean but your carrying the ball for all of us
"Transocean has also agreed to acquire the outstanding interests in Liquila Ventures Ltd., a company formed to acquire the Deepwater Aquila, from its joint venture partners, Perestroika and Lime Rock Partners.
The Deepwater Aquila is expected to be delivered from the shipyard in October 2023."
https://www.offshore-mag.com/rigs-vessels/article/14299003/transocean-announces-486million-contract-for-deepwater-aquila
"he contract is expected to commence in the third quarter of 2024 and represents approximately $486 million in firm backlog, excluding a mobilization fee of approximately 90 times the contract dayrate."
This is all great news, but I would like to see some of this backlog impact the top line. Sometime this year
Giveth one day, taketh away the next. Crazy. Prolly something to do with BP oil
"Oil Prices Continue To Climb Toward $100"
https://oilprice.com/Energy/Energy-General/Oil-Prices-Continue-To-Climb-Toward-100.html
"China’s August Oil Imports Surge To The Third-Highest Level Ever"
https://oilprice.com/Latest-Energy-News/World-News/Chinas-August-Oil-Imports-Surge-To-The-Third-Highest-Level-Ever.html
"What’s Behind The Surge In Investment In North Sea Oil And Gas?"
https://oilprice.com/Energy/Crude-Oil/Whats-Behind-The-Surge-In-Investment-In-North-Sea-Oil-And-Gas.html
"Equinor ASA: Share buy-back
Please see below information about transactions made under the share buy-back programme for Equinor ASA (OSE:EQNR, NYSE:EQNR).
Date on which the third tranche of the share buy-back programme for 2023 was announced: 26 July 2023.
The duration of the third tranche of the buy-back programme for 2023: 27 July to no later than 26 October 2023.
Size of the buy-back programme: Up to 94,000,0000 shares, with a maximum total consideration for the third tranche: USD 550,000,000."
"TRANSOCEAN LTD. : Entry into a Material Definitive Agreement, Financial Statements and Exhibits (form 8-K)"
https://www.marketscreener.com/quote/stock/TRANSOCEAN-LTD-14246/news/TRANSOCEAN-LTD-Entry-into-a-Material-Definitive-Agreement-Financial-Statements-and-Exhibits-for-41221596/
9/1/23 @ 9:47. WTI currently at $84.82
"Equinor Boosts Oil And Gas Production With New Expansion Project"
https://oilprice.com/Energy/Crude-Oil/Equinor-Boosts-Oil-And-Gas-Production-With-New-Expansion-Project.html
"Ships Warned Of Increased Iranian Threat Near Strait Of Hormuz"
"The Persian Gulf exports approximately 18.2 million barrels of oil per day; approximately 17 million barrels per day transit through the Strait of Hormuz in tankers. Additionally, over 3.5 billion cubic feet of natural gas, approximately 18 percent of world shipments, travel through the Strait via LNG tankers."
Added today. Rig looks and acting like a winner
"IEA: Global Oil Demand Hits Record High"
https://oilprice.com/Energy/Energy-General/IEA-Global-Oil-Demand-Hits-Record-High.html
"$85 Is Just The Beginning Of The Oil Rally"
https://oilprice.com/Energy/Crude-Oil/85-Is-Just-The-Beginning-Of-The-Oil-Rally.html
I have not pulled it up the transcript yet.
It's so much easier that way. CC's can bore you to death!
Well, the conference call transcript has a lot of detail in it that is beyond me. However, I've decided to focus on revenue generation. According to Mark Mey RIG made $748 million in drilling revenue with an average day rate of $367,000.
Earlier in the call J. Thigpen indicated average day rates would increase to $433,000 a 17% increase. So I would expect to see revenue around $882.5 next June. which should impact PE ratios. If not it's time to look at costs to see why and perhaps re-evaluate
Well, I gave the transcript a quick once-over and I didn't see any change in the guidance for the second half of 23. However, they did talk about increasing day rates over the next 12 months. and improving conditions (future operations) based on demand for energy and the supply of these platforms. They frequently speak of day rates going to 500K and beyond.
So, to me (I'm no expert) if day rates continue up and utilization rates increase, and debt is converted to stock (based on PPS). Revenue should go up proportionately.
" in the second quarter of 2023, our average day rate was approximately $363,000 per day versus $312,000 per day in the second quarter of 2022. And based on existing backlog by the second quarter of 2024, we expect it to approximate $433,000 per day."
I follow SLB/EQNR (and WTI/ Brent NS) as proxies for the industry. SLB beat on the bottom line but fell short on the top. They did however give upbeat guidance for the upcoming quarter. So That's what I look at when evaluating RIG.
Didn't catch the conference call. Yahoo finance usually prints a transcript I'll have to read that. I'd like to hear an upbeat projection going forward. I'd also like to hear someone question when or if they estimate a return to profitability.
P.S.
8/1/2023 8:18
Benchmark analyst Kurt Hallead reiterates Transocean (NYSE:RIG) with a Buy and maintains $12 price target.
Go figure.
Me too. I'd like to hear a little optimism going forward about earnings. Some mention of turning the corner.
I feel like I say that every quarter. ;)
Earnigs call at 9 am today. Hopefully good news going forward
TRANSOCEAN LTD. REPORTS SECOND QUARTER 2023 RESULTS
https://www.sec.gov/Archives/edgar/data/1451505/000145150523000093/rig-20230731xex99d1.htm
Total contract drilling revenues were $729 million, compared to $649 million in the first quarter of 2023 (total adjusted contract drilling revenues of $748 million, compared to $667 million in the first quarter of 2023);
Revenue efficiency(1) was 97.2%, compared to 97.8% in the prior quarter;
Operating and maintenance expense was $484 million, compared to $409 million in the prior quarter;
Net loss attributable to controlling interest was $165 million, $0.22 per diluted share, compared to $465 million, $0.64 per diluted share, in the first quarter of 2023;
Adjusted EBITDA was $237 million, compared to $217 million in the prior quarter;
Cash flows from operations was $157 million, versus $(47) million in the first quarter of 2023; and
Contract backlog was $9.2 billion as of the July 2023 Fleet Status Report.
STEINHAUSEN, Switzerland—July 31, 2023—Transocean Ltd. (NYSE: RIG) today reported a net loss attributable to controlling interest of $165 million, $0.22 per diluted share, for the three months ended June 30, 2023.
Second quarter results included net unfavorable items of $55 million, or $0.07 per diluted share as follows:
$53 million, $0.07 per diluted share, loss on impairment of assets; and
$2 million, other discrete items, net.
After consideration of these net unfavorable items, second quarter 2023 adjusted net loss was $110 million, or $0.15 per diluted share.
Contract drilling revenues for the three months ended June 30, 2023, increased sequentially by $80 million to $729 million, primarily due to increased activity for rigs that returned to work after being idle in the first quarter, the commencement of operations of the newbuild Deepwater Titan and $19 million of revenues associated with the early termination of Transocean Endurance and Transocean Barents, partially offset by reduced activity for two rigs that were idle in the second quarter of 2023.
Contract intangible amortization represented a non-cash revenue reduction of $19 million. This compares with $18 million in the prior quarter.
Operating and maintenance expense was $484 million, compared with $409 million in the prior quarter. The sequential increase was primarily due to rigs that returned to work after being idle, the commencement of operations of the newbuild Deepwater Titan and higher costs associated with two rigs undergoing contract preparation.
Interest expense, net of amounts capitalized, was $168 million, compared with $249 million in the prior quarter. Interest expense included a non-cash loss of $46 million, compared with $133 million in the prior quarter, associated with the fair value adjustment of the bifurcated exchange feature embedded in our exchangeable bonds issued in September of 2022. Interest income was $11 million, compared with $19 million in the previous quarter.
The Effective Tax Rate(2) was 8.8%, up from (12.3)% in the prior quarter. The increase was primarily due to updates to our forecast to include losses on revaluation of our exchangeable bonds. The Effective Tax Rate excluding discrete items was 11.7% compared to (29.0)% in the previous quarter.
Cash provided by operating activities was $157 million during the second quarter of 2023, representing an increase of $204 million compared to the prior quarter. The sequential increase is primarily due to increased collections from customers, reduced payments for payroll-related items, and reduced payments for interest.
Second quarter 2023 capital expenditures of $76 million decreased primarily due to reduced spending for our newbuild rigs under construction. This compares with $81 million in the prior quarter.
“During the second quarter, we continued to benefit from increased demand for our fleet of high-specification floaters. As of our latest fleet status report, we secured an additional $1.2 billion of backlog at a weighted average dayrate of approximately $456,000,” said Chief Executive Officer, Jeremy Thigpen. “As evidenced by our customers contracting rigs well in advance of their programs and committing to long-term contracts, the outlook for our high-specification assets and services remains robust.”
Thigpen concluded, “In addition to securing contracts at market-leading rates, our focus remains on the flawless execution of our offshore operations to maximize the value of our $9.2 billion backlog for our shareholders.”
Non-GAAP Financial Measures
We present our operating results in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). We believe certain financial measures, such as Adjusted Contract Drilling Revenues, EBITDA, Adjusted EBITDA and Adjusted Net Income, which are non-GAAP measures, provide users of our financial statements with supplemental information that may be useful in evaluating our operating performance. We believe that such non-GAAP measures, when read in conjunction with our operating results presented under U.S. GAAP, can be used to better assess our performance from period to period and relative to performance of other companies in our industry, without regard to financing methods, historical cost basis or capital structure. Such non-GAAP measures should be considered as a supplement to, and not as a substitute for, financial measures prepared in accordance with U.S. GAAP.
All non-GAAP measure reconciliations to the most comparative U.S. GAAP measures are displayed in quantitative schedules on the company’s website at: www.deepwater.com.
About Transocean
Transocean is a leading international provider of offshore contract drilling services for oil and gas wells. The company specializes in technically demanding sectors of the global offshore drilling business with a particular focus on ultra-deepwater and harsh environment drilling services, and operates the highest specification floating offshore drilling fleet in the world.
Transocean owns or has partial ownership interests in and operates a fleet of 37 mobile offshore drilling units, consisting of 28 ultra-deepwater floaters and nine harsh environment floaters. In addition, Transocean holds a noncontrolling ownership interest in a company that is constructing one ultra-deepwater drillship.
For more information about Transocean, please visit: www.deepwater.com.
Conference Call Information
Transocean will conduct a teleconference starting at 9 a.m. EDT, 3 p.m. CEST, on Tuesday, August 1, 2023, to discuss the results. To participate, dial +1 785-424-1222 and refer to conference code 623461 approximately 15 minutes prior to the scheduled start time.
The teleconference will be simulcast in a listen-only mode at: www.deepwater.com, by selecting Investors, News, and Webcasts. Supplemental materials that may be referenced during the teleconference will be available at: www.deepwater.com, by selecting Investors, Financial Reports.
A replay of the conference call will be available after 12 p.m. EDT, 6 p.m. CEST, on Tuesday, August 1, 2023. The replay, which will be archived for approximately 30 days, can be accessed at +1 402-220-7343, passcode 623461. The replay will also be available on the company’s website.
me too. Hoping for a top and bottom-line beat. Something to take us over 10 bucks..
Thanks!
I am very curious to see what they report.
Gregory Lewis
BTIG
Buy
07/28/23 price target $12.00
It did? I didn't catch that one. Thanks.
Got an upgrade on 7/28 with a $12 price target
Todays our day. Let's see what those numbers are.
Transocean Ltd. (NYSE: RIG) will report earnings for the second quarter 2023 after the close of trading on the NYSE on Monday, July 31, 2023.
"Offshore Oil Stocks Flying As Investors Bet On A Deep Water Boom"
https://oilprice.com/Energy/Crude-Oil/Offshore-Oil-Stocks-Flying-As-Investors-Bet-On-A-Deep-Water-Boom.html
"Stocks of offshore oil and gas drillers and producers have gone on a tear after recent contracts broke records, reversing their seven-year downturn that reached its nadir during the Covid-19 pandemic. Rising global petroleum demand, coupled with increasing deepwater exploration and drilling, has been keeping offshore contractors really busy.
Leading with impressive gains is deepwater drilling specialist, Transocean Ltd. (NYSE:RIG), whose stock has gained 99.1% in the year-to-date. RIG stock jumped nearly 10% over the past week after the company reported a three-year, $518 million contract to deploy one of its drillships in the Gulf of Mexico, the latest in a series of large transactions announced in recent months. The company has revealed that its aggregate incremental backlog associated with the latest contracts totals ~$1.2, bringing its total backlog to $9.2B. Meanwhile, rig rates have shot up to $480,000 a day, a 50%Y/Y increase and about triple the downturn’s lows.
"Last month, Norway’s government submitted to Parliament plans to open a large area to deep sea mining as it seeks to access and extract critical minerals from the seabed.
“We need minerals to succeed in the green transition. Currently, the resources are controlled by a few countries, which makes us vulnerable,” Norway’s Minister of Petroleum and Energy, Terje Aasland said."
https://oilprice.com/Latest-Energy-News/World-News/UN-Fails-To-Reach-Agreement-On-Deep-Sea-Mining-Regulation.html
"Oil Prices Climb To Multi-Month High As Market Eyes Tightening"
https://oilprice.com/Latest-Energy-News/World-News/Oil-Prices-Climb-To-Multi-Month-High-As-Market-Eyes-Tightening.html
This quarter’s report includes the following updates:
Seventh Generation Ultra-Deepwater Drillship (Deepwater Invictus, Deepwater Thalassa, or
Deepwater Proteus) – Awarded a 1,080-day contract in Mexico at a rate of $480,000.
Transocean Equinox – Awarded a five-well contract, plus a one-well option in Australia at a rate of
$455,000.
Transocean Equinox – Awarded a sixteen-well contract in Australia at a rate of $485,000, plus 21
one-well options at rates between $485,000 and $540,000.
Transocean Endurance – Awarded a two-well contract in Norway at a rate of $385,000.
Transocean Barents – Awarded a one-well contract in Lebanon at a rate of $365,000, plus 3 onewell options at rates that may vary between $350,000 and $390,000.
Transocean Encourage – Customer exercised six one-well options in Norway at a current rate of
$464,000.
Transocean Norge – Customer exercised a one-well option in Norway at a current rate of $365,000
and 3 one-well options at a current rate of $420,000.
Transocean Barents – Customer exercised a one-well option in the East Mediterranean Sea at a rate
of $370,000.
The aggregate incremental backlog associated with these fixtures is approximately $1.2 billion. As of July19, 2023, the company’s total backlog is approximately $9.2 billion. Assuming all contract options are exercised, the potential incremental backlog associated with the contract options is approximately $480 million to $500 million.
we will get earnings at the end of the month. Hopefully a top and bottom beat
They are just rocking it right now!
Thanks for the update!
I wonder if this will ever again reach the all-time high of $171?
DJ Transocean Deal Shows Rate and Term Possible in Tightening Market -- Market Talk
9:13 AM ET 7/18/23 | Dow Jones
0913 ET - The world's largest offshore oil driller Transocean says it's made a three-year deal with an "independent operator" to do work in the Gulf of Mexico offshore Mexico for $518M, and will begin as early as 4Q 2025. "While some investors have been anticipating that the drillers could trade rate for term in order to fill their backlogs, this contract points to a sufficiently tight market for high spec assets for the Drillers to secure both rate and term," says Citi's Scott Gruber in a note. "For Transocean specifically, the ability to build long dated backlog at leading edge dayrates further improves their deleveraging prospects." Transocean shares jump 3.7% pre-market. (dan.molinski@wsj.com)
Barcharts opinion: Current direction = top 1% (strongest)
"“This award is especially encouraging on numerous fronts,” said Chief Executive Officer Jeremy Thigpen. “The fact that our customers are securing rigs well in advance of their programs and committing to long-term contracts clearly demonstrates the tightness of the market. Additionally, our ability to designate the specific rig closer to the commencement of the program provides us with increased flexibility to optimize the utilization of our high-specification fleet of ultra-deepwater drillships.”
$10.00/share!
It would be nice to get June numbers, but we wait on that. If June is strong, we may get a favorable result in the second quarter
"Oil Demand Jumped By 3 Million Bpd In May To Near-Record Levels"
https://oilprice.com/Latest-Energy-News/World-News/Oil-Demand-Jumped-By-3-Million-Bpd-In-May-To-Near-Record-Levels.html
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BUSINESS SUMMARY:
Transocean Inc. (Transocean) is the world's largest offshore drilling contractor and the leading provider of drilling management
services worldwide.
With a fleet of 139 mobile offshore drilling units plus three ultra-deepwater newbuild drillships under construction, Transocean's
fleet is considered one of the most modern and versatile in the world due to its emphasis on technically demanding segments of
the offshore drilling business.
Transocean owns or operates a contract drilling fleet of 45 High-Specification Floaters (Ultra-Deepwater, Deepwater and Harsh-Environment
semisubmersibles and drillships), 26 Midwater Floaters, 10 High-Specification Jackups, 55 Standard Jackups and other assets utilized in the
support of offshore drilling activities worldwide.
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