Noble Earnings: Snaps Strong Streak with Profit Dip

S&P 500 (NYSE:SPY) component Noble Corporation (NYSE:NE) reported its results for the third quarter. Noble is a contract driller of oil and natural gas wells. It provides customers in the oil and gas industry with offshore drilling services and engineering and consulting services.

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Noble Corporation Earnings Cheat Sheet

Results: Net income for Noble Corporation fell to $114.8 million (45 cents per share) vs. $135.3 million (53 cents per share) a year earlier. This is a decline of 15.2% from the year-earlier quarter.

Revenue: Rose 19.8% to $884 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Noble Corporation fell short of the mean analyst estimate of 57 cents per share. Analysts were expecting revenue of $895.7 million.

Quoting Management: David W. Williams, Chairman, President and Chief Executive Officer of Noble Corporation, stated, “The decline in third quarter financial results was due primarily to lower than expected utilization on two of our new drillships, Noble Bully I and Noble Bully II, as we worked to solve a number of operational issues, as well as delays in returning rigs to work in Brazil which were caused by a number of labor actions within the shipyard and regulatory support infrastructure that caused two rigs to be delayed following completion of ongoing projects. Further, we experienced other out of service time involving several rigs and in response to these events and the effects of Hurricane Isaac, operating costs in the quarter moved ahead of our expectations, further pressuring margins. With few exceptions, these matters have now been resolved and we expect improved operational performance in the final quarter of 2012.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 27.6%, with the biggest boost coming in the second quarter when revenue rose 43.1% from the year earlier quarter.

Last quarter’s profit decrease breaks a streak of four consecutive quarters of year-over-year profit increases. In the second quarter, net income rose more than twofold from the year earlier, while the figure increased more than twofold in the first quarter, 28.6% in the fourth quarter of the last fiscal year and 57.3% in the third quarter of the last fiscal year.

The company fell short of estimates last quarter after beating the mark the quarter before with net income of 47 cents versus a mean estimate of net income of 41 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 76 cents a share to 71 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $2.82 a share to $2.74 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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