Rowan Companies Earnings Cheat Sheet: Profit Climbs, Revenue Falls

S&P 500 (NYSE:SPY) component Rowan Companies Inc. (NYSE:RDC) reported higher net income for the second quarter. Rowan Companies Inc. provides international and domestic contract drilling services as well as equipment for the drilling, mining and timber industries.

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Rowan Companies Earnings Cheat Sheet for the Second Quarter

Results: Net income for the oil and gas drilling and exploration company rose to $465.9 million ($3.65 per share) vs. $90.9 million (79 cents per share) in the same quarter a year earlier. This marks a substantial increase from the year earlier quarter.

Revenue: Fell 20.8% to $223.5 million from the year earlier quarter.

Actual vs. Wall St. Expectations: RDC‘s income from continuing operations fell to 35 cents per share. By that measure, the company beat the mean estimate of 33 cents per share. It fell short of the average revenue estimate of $278.9 million.

Quoting Management: Matt Ralls, President and Chief Executive Officer, commented, “Over the past three months, we made substantial progress on several strategic fronts. We completed the sale of our manufacturing business and reached an agreement to sell our land drilling division, enabling us to focus exclusively on our core offshore drilling business. We significantly expanded the future growth prospects of that business by ordering two ultra-deepwater drillships that we believe will be the most capable in the global fleet upon delivery. Our first two N-class jack-up rigs commenced operations in the North Sea in June and we achieved our objective of entering the important Southeast Asia market with commitments starting later this year in Malaysia and Vietnam – Rowan’s first work in that area in almost two decades. Further, over the past three months we increased our backlog of drilling revenue commitments by 67% to $2.6 billion.”

Key Stats:

Last quarter’s profit increase breaks a streak of four consecutive quarters of year-over-year profit drops. In the first quarter, net income fell 50.4% from the year earlier, while the figure fell 5.8% in the fourth quarter of the last fiscal year, 14.3% in the third quarter of the last fiscal year and 5.9% in the second quarter of the last fiscal year.

The company topped expectations last quarter after falling short of forecasts in the first quarter with net income of 24 cents versus a mean estimate of net income of 30 cents per share.

Revenue has fallen in the past two quarters. In the first quarter, revenue declined 15.8% to $364.3 million from the year earlier quarter.

Competitors to Watch: Pride International, Inc. (NYSE:PDE), Atwood Oceanics, Inc. (NYSE:ATW), Hercules Offshore, Inc. (NASDAQ:HERO), Diamond Offshore Drilling, Inc. (NYSE:DO), Vantage Drilling Company (AMEX:VTG), Seahawk Drilling, Inc. (NASDAQ:HAWK), Helmerich & Payne, Inc. (NYSE:HP), Parker Drilling Company (NYSE:PKD), Patterson-UTI Energy, Inc. (NASDAQ:PTEN), and Pioneer Drilling Company (AMEX:PDC).

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(Source: Xignite Financials)