Diamond Offshore Drilling, one of the world’s top-five offshore rig contractors, reported a slightly higher quarterly profit, helped by demand for its high-tech ultra-deepwater rigs and a drop in operating costs.
Demand is strong for modern, faster rigs because they are cheaper to run and can drill more efficiently for oil and gas companies, which have been cutting spending due to low prices.
Diamond Offshore, owned 52 percent by New York-based conglomerate Loews, said on Monday that revenue from its ultra-deepwater business rose 72.8 percent to $315.7 million in the second quarter ended June 30.
Average day-rates for the business, which accounts for about of the company’s total revenue, rose 11 percent to $483,000, while utilization rose to 63 percent from 51 percent.
Utilization rates for the company’s second-biggest business, deepwater rigs, also rose to 63 percent from 51 percent.
Net profit rose slightly to $90.4 million, or 66 cents per share, from $89.7 million, or 65 cents per share. Total operating expenses fell nearly 10.5 percent to $499.9 million.
However, the Houston-based company’s total revenue fell to $634 million from $692.2 million a year earlier.
Up to Friday’s close of $21.95, Diamond Offshore’s stock had fallen 40 percent this year.