By Braden Reddall
SAN FRANCISCO, Aug 4 (Reuters) - Transocean Ltd , the drilling contractor that lost its rig in the BP Plc well blowout in April, reported a drop in profit for the quarter due to resulting legal costs and reduced income.
The profit was lower than expected, and shares of the world's largest offshore rig contractor fell more than 1 percent following the results.
The BP disaster in April brought most drilling activity to a halt in the Gulf of Mexico, where Transocean had 14 other deepwater rigs under contract. But long-term pricing for many of its rigs had been hit by a slowdown in drilling last year.
The Switzerland-based company said litigation filed over the oil spill would hold up payment of its quarterly dividend, which must be approved by local authorities under Swiss law.
'The Swiss authorities have indicated to us that the review process will take longer than customary in light of lawsuits filed in the U.S. and served on the company in Switzerland,' Transocean said in a statement.
Executives will discuss the results with investors on a conference call on Thursday, and Mike Breard, energy analyst at Dallas-based Hodges Capital Management, said he would be looking for some reassurance on the eventual dividend payout.
Second-quarter net profit fell to $715 million, or $2.22 per share, from $806 million, or $2.49 per share, a year earlier, with an after-tax cost of $69 million associated with the well blow-out. Revenue fell 13 percent to $2.5 billion.
The profit figure also includes a $267 million gain on insurance recoveries for the lost rig, offset by $18 million in legal costs not associated with the Gulf of Mexico well.
Transocean's adjusted profit per share was $1.44 per share, whereas analysts had expected $1.68 per share, according to Thomson Reuters I/B/E/S.
Other rig operators competing with Transocean, the industry leader, reported weaker profits last month, though they expected tighter regulations in the Gulf of Mexico would create chances to buy more rigs.
Shares of Transocean, up 6.3 percent in regular trading, fell 1.3 percent to $52.85 in after-hours trading.
Shares of Transocean have lost 42 percent of their value since the deadly explosion on April 20 that sank the Deepwater Horizon, due to fears that the company may be found liable for some of the costs that resulted from the worst accidental maritime spillage of oil.
(Reporting by Braden Reddall; Editing by Steve Orlofsky, Bernard Orr) Keywords: TRANSOCEAN/ (braden.reddall@thomsonreuters.com; +1 415 677 2543; braden.reddall.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
SAN FRANCISCO, Aug 4 (Reuters) - Transocean Ltd , the drilling contractor that lost its rig in the BP Plc well blowout in April, reported a drop in profit for the quarter due to resulting legal costs and reduced income.
The profit was lower than expected, and shares of the world's largest offshore rig contractor fell more than 1 percent following the results.
The BP disaster in April brought most drilling activity to a halt in the Gulf of Mexico, where Transocean had 14 other deepwater rigs under contract. But long-term pricing for many of its rigs had been hit by a slowdown in drilling last year.
The Switzerland-based company said litigation filed over the oil spill would hold up payment of its quarterly dividend, which must be approved by local authorities under Swiss law.
'The Swiss authorities have indicated to us that the review process will take longer than customary in light of lawsuits filed in the U.S. and served on the company in Switzerland,' Transocean said in a statement.
Executives will discuss the results with investors on a conference call on Thursday, and Mike Breard, energy analyst at Dallas-based Hodges Capital Management, said he would be looking for some reassurance on the eventual dividend payout.
Second-quarter net profit fell to $715 million, or $2.22 per share, from $806 million, or $2.49 per share, a year earlier, with an after-tax cost of $69 million associated with the well blow-out. Revenue fell 13 percent to $2.5 billion.
The profit figure also includes a $267 million gain on insurance recoveries for the lost rig, offset by $18 million in legal costs not associated with the Gulf of Mexico well.
Transocean's adjusted profit per share was $1.44 per share, whereas analysts had expected $1.68 per share, according to Thomson Reuters I/B/E/S.
Other rig operators competing with Transocean, the industry leader, reported weaker profits last month, though they expected tighter regulations in the Gulf of Mexico would create chances to buy more rigs.
Shares of Transocean, up 6.3 percent in regular trading, fell 1.3 percent to $52.85 in after-hours trading.
Shares of Transocean have lost 42 percent of their value since the deadly explosion on April 20 that sank the Deepwater Horizon, due to fears that the company may be found liable for some of the costs that resulted from the worst accidental maritime spillage of oil.
(Reporting by Braden Reddall; Editing by Steve Orlofsky, Bernard Orr) Keywords: TRANSOCEAN/ (braden.reddall@thomsonreuters.com; +1 415 677 2543; braden.reddall.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.