Noble Corp. Q2 Profit Up 30% On Higher Demand, Lower Expense

(RTTNews) - Offshore drilling contractor Noble Corp. (NE | Quote | Chart | News | PowerRating) Wednesday said second-quarter earnings increased by about 30%, helped by an increase in rates due to higher demand for offshore drilling rigs, as a result of rising oil prices. Lower expenses, helped by a gain from the sale of assets, also contributed to the earnings growth. Second quarter revenues increased about 12% from last year.

Net income for the quarter increased 30% to $375.72 million from $290.03 million, while earnings per share advanced to $1.40 from $1.08 in the same quarter last year.

On average, 31 Street analysts polled by First Call/Thomson Financial expected the company to earn $1.31 per share for the quarter.

Sugar Land, Texas-based Noble Corp. recorded total operating revenues of $812.84 million for the quarter, up 12% from $726.00 million in the prior-year quarter. Twenty analysts had a consensus revenue estimate of $834.94 million for the second quarter.

Contract drilling services revenue for the quarter increased 19% to $783.28 million, while labor contract drilling services revenue dropped to $8.22 million from $39.17 million in the prior-year quarter.

Second-quarter operating income climbed to $460.15 million from $361.01 million in the comparable quarter a year earlier.

Operating expenses for the quarter, including an after-tax gain of $35.52 million from the sale of Noble Corp.'s North Sea labor contract drilling services business, declined to $352.80 million from $364.99 million in the year-ago quarter.

Amongst peers, Texas-based Diamond Offshore Drilling Inc. (DO | Quote | Chart | News | PowerRating) is scheduled to release second quarter results on Thursday, with analysts expecting the company to earn $2.76 per share on revenues of $925.60 million. Another offshore drilling contractor, Nabors Industries Ltd. (NBR | Quote | Chart | News | PowerRating) reported a sharp decline in its second-quarter profit, hurt by losses on sales of long-lived assets and impairment charges. Revenues, however, increased from last year.

On July 11, analysts at Friedman Billings reiterated their 'outperform' rating on Noble Corp., while raising the target price to $76 from $71.

Year-to-date net income jumped to $759.91 million or $2.83 per share from $540.35 million or $2.01 per share in the corresponding period a year earlier. Revenues for the six-month period increased 22% to $1.67 billion from last year.

Noble Corp. closed Wednesday's trading at $52.76, down $3.21 or 5.74%, on a volume of about 7.21 million shares. In after-hours, the stock further lost $1.29 or 2.45%, trading at $51.47. NE has been moving in a range of $40.40 to $68.99 for the past twelve months, with a three-month average volume of about 5.09 million shares.

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