Tidewater reports a red ink quarter

For the same quarter last year, net earnings were $60.9 million, or $1.22 per common share, on revenues of $397.5 million.

The immediately preceding quarter ended June 30, 2015, had a net loss of $15.1 million, or $0.32 per common share, on revenues of $304.8 million.

Included in the net loss for the quarter ended September 30, 2015 were:

Income tax expense in the September and June quarters of fiscal 2016 largely reflect tax liabilities in certain jurisdictions that levy taxes on bases other than pre-tax profitability (so called “deemed profit” regimes.)

Included in the net loss for the quarter ended June 30, 2015 were the following:

Tidewater will hold a conference call to discuss September quarterly earnings on Wednesday, November 4, 2015, at 10:00 a.m. Central time. Investors and interested parties may listen to the teleconference via telephone by calling 1-888-771-4371 if calling from the U.S. or Canada (1-847-585-4405 if calling from outside the U.S.) and ask for the “Tidewater” call just prior to the scheduled start. A replay of the conference call will be available beginning at 12:00 p.m. Central time on November 4, 2015, and will continue until 11:59 p.m. Central time on November 6, 2015. To hear the replay, call 1-888-843-7419 (1-630-652-3042 if calling from outside the U.S.). The conference call ID number is 40898911.

A simultaneous webcast of the conference call will be available online at the Tidewater Inc. website, (http://www.tdw.com). The online replay will be available until December 4, 2015.

COWAN’S VIEW

Cowan and Company analyst J.B. Lowe says that the quarterly report has “Modestly Negative Implications.”

Tidewater reported an operating loss per share of $0.28, versus Cowan’s estimate and a consensus loss of $0.02/sh.
“However, much of the loss compared to our estimate was tax driven; operating income of $15.5 million compared to our $15 million estimate, and adjusted EBITDA of $62 million was above our $60 million estimate,” says the Cowan analyst.

Tidewater’s loss from continuing operations of $0.28 compared with Cowan’s and a consensus loss of $0.02/sh. Results exclude a $0.67/sh non-cash impairment charge, a $0.13/sh restructuring charge, $0.11/sh in FX losses and a $0.13/sh loss on asset dispositions. Higher-than-expected taxes negatively affected the quarter by $0.28/sh compared to estimate, meaning the company would have broken even at our Cowan’s tax rate expectation.

The company exceeded  Cowan’s estimates on an operating basis, with operating income of $15.5 million coming in ahead of the $15 million estimate. Better-than-expected results were driven by lower operating costs and G&A expense than forecast, more than offsetting the top-line miss.

Total revenues of $272 million were short of Cowan’s $287mm estimate, while vessel revenues of $264 million were behind Cowan’s $278 milion forecast and below the average $275 million in revenues expected on the F1Q16 conference call. The relative underperformance was driven by weakness in the Americas region, partially offset by higher-than expected results in the Asia/Pacific and Sub-Saharan Africa/Europe regions.

Vessel operating costs of $159 million were below Cowan’s $170 million forecast. Repair and maintenance costs fell sequentially as expected from $37.3 million in F1Q16 to $28.5 million (versus Cowan’s expectation of $34.7million).

Crew costs of $84 million were below Cowan’s  $86 million forecast, although this was partially offset by higher fuel costs of $17 million. Vessel cash operating margin of 40% exceeded Cowan’s 39% estimate and fell within the guidance range of 36-40%. G&A expense of $37 million was well below our $43 millionexpectation, offset by higher-than-forecast DD&A expense of $46 million (vs our $45 mm estimate).

The company-wide average dayrate of $16,039/d was 5% below Cowan’s $16,946/d forecast. Deepwater dayrates of $24,535/d were short of Cowan’s $26,067/d estimate while TS/S rates of $13,689/d were in-line Cowan’s $13,662/d forecast. Worldwide utilization of 65.7% matched Cowan’s 65.8% estimate, driven largely by the ‘Other’ vessel segment as deepwater (63%) and TS/S (67%) utilization were below or in-line with Cowan’s forecasts of 68.3% and 66.5%.

Americas revenue of $89.2 million “fell well short of our $106.7 million forecast, driven largely by lower dayrates ($20,725/d vs our $22,511/d estimate) and by lower utilization (59.7% vs our 66.1% estimate).”

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Rolls-Royce wins power and propulsion order for DP3 DSV

Being built to a new Skipsteknisk, Norway, designated ST-246 DSV, the 120 passenger vessel will be fitted with a 24 person SAT dive system and will have a 250 t offshore crane.

Under the contract with the shipbuilder signed by Rolls-Royce, the vessel will be equipped with the latest DP3 control system and four of the latest Bergen B33:45 generating sets. The total delivery also includes main propulsion, tunnel thrusters and remote controls.

The medium-speed Bergen B33:45 main engines, launched last year, offer a 20 percent increase in power per cylinder compared to existing engines in the Bergen range and comply with IMO Tier II and III rules.The B33:45 is designed to run for 25,000 hours between major maintenance when operating at average loads.

The vessel will be fitted with the Rolls-Royce Icon DP3 (Dynamic Positioning System) — the first Rolls-Royce contract for DP3 for a vessel built in China.

DP systems with classification 3 allow for safe and efficient operations in demanding conditions where any loss of position has the potential to result in fatal accidents, severe pollution or damage with major economic consequences.

The Rolls-Royce DP3 system has an award-winning ergonomic design. A unified look and feel to bridge controls ensures safe operation. The control system itself is closely connected with other inboard control systems and easy to integrate into a bridge arrangement. Among the many advantages, according to Rolls-Royce, is that it provides the vessel owner with a system that is easier and faster to install and commission. Fewer service engineers will also be required for service and maintenance of thrusters and controls later in the vessel’s lifetime.

Helge Gjerde, Rolls-Royce, President Commercial – Marine, said: “We are delighted to win this contract in the current difficult market. We are also pleased to welcome Jumeria Offshore as a new customer and we are looking forward to working with them on such an exciting and advanced ship project.”

skipstek 700

Pacific Drilling cancels drillship order at Samsung

Pacific Drilling S.A. (NYSE:PACD) reports that it has exercised its right to rescind the construction contract for ultra-deepwater drillship Pacific Zonda “due to the failure by Samsung Heavy Industries (SHI) to timely deliver a vessel that substantially meets the criteria required for completion of the vessel in accordance with the construction contract and its specifications.”

Pacific Drilling says it made advance payments totaling approximately $181.1 million under the shipbuilding contract, and will be seeking a refund of the installment payments.

The company inked a contract for the drillship with Samsung Heavy on January 25, 2013 that provided for a delivery date of March 31, 2015.

The cancelation comes after the October 27 news that Fred Olsen Energy had canceled an semisubmersible drilling rig order at Hyundai Heavy Industries and the October 26 announcement that Transocean, Shell ans Daewoo Shipbuilding & Marine Engineering Co. (DSME) had agreed to push back the operating and delivery contracts of two newbuild ultra-deepwater drillships – the Deepwater Pontus and the Deepwater Poseidon – by 12 months each.

Fred Olsen Energy terminates rig contract at HHI

Today, Fred. Olsen Energy said that its Bollsta Dolphin Pte. Limited subsidiary has notified HHI that it has exercised its contractual termination right under the newbuilding contract as a result of the delay in delivery of the rig, the Bollsta Dolphin, a Moss CS 60 E, sixth generation ultra deepwater semi-submersible.

Fred. Olsen Energy says that the rig construction contract provides that on termination Bollsta will be
entitled to a refund of the first instalment paid to HHI of $186,390,240 plusaccrued interest.

The rig had been under contract to Chevron North Sea Limited under a contract entered into in October 2012. That contract has now been “mutually terminated” on “amicable terms.”

GulfMark Offshore trims its C suite

On October 21, 2015, says the filing, the company and Mr. David B. Rosenwasser, its Senior Executive Vice President and Chief Operating Officer, mutually agreed that his employment will terminate effective October 31, 2015.

On October 23, 2015, the company entered into an agreement with Mr. Rosenwasser that, among other things, provides for the following:

The agreement also provides for payment for limited consulting services by Mr. Rosenwasser over the following 24 months.

Transocean, Shell and DSME to delay two drillship deliveries

OCTOBER 26, 2015 — In yet another indication of the slowdown in global offshore drilling activity, Transocean Ltd. (NYSE: RIG) (SIX: RIGN) today reported a mutual agreement with customer Shell EP Wells

DryShips to acquire Nautilus Offshore Services

OCTOBER 23, 2015—DryShips Inc., Athens, Greece, the largest U.S.-listed dry bulk fleet operator, has inked a deal to acquire about 98% of Nautilus OffShore Services Inc. for a purchase price of $87

Damen and Delta develop DP2 Renewables Service Vessel

Delta has awarded Damen a construction contract that will see the first of the vessels launched in early 2017. Following fabrication of the hull in Poland, Damen Shipyards Hardinxveld in the Netherlands will complete the final outfitting process.

“For the last couple of years we’ve been working on this new design with Damen Shipyards Hardinxveld,” says Delta Marine General Manager Dave McNaughtan. “We came up with concepts – gave them to Damen, who would put those ideas on the drawing board. They gave their expertise – adding the engineering for example – and then came back to us.”

“Client feedback is very important to us,” says Damen Shipyards Hardinxveld Managing Director Jos van Woerkum. “It has been great to work so closely with Delta Marine to develop this new design.”

“Damen are very good at developing their vessels,” continues Mr. McNaughtan. “Even their established vessels like Multi Cats and Shoalbusters are continually getting better.”

The new design has evolved from the Multi Cat.

“We have changed the design by moving the wheelhouse forward and leaving the aft deck open,” says Mr. McNaughtan. “We’ve managed to keep it under the 500-tonne mark. This was a critical factor – one that will help keep the costs down.”The Renewables Service Vessel 3315 will be able to take on a lot of the work larger offshore construction vessels currently perform, says Mr. McNaughtan.

“We’ll have full DP2 capability and, with such a wide deck, we’ll be able to fit a cable lay carousel, work class ROVs or cable trenching machines,” he says.

The vessel will also be fitted with two large HS Marine cranes and a 4-point mooring system.

BSEE and USCG investigate drillship fatality

The Pacific Santa Ana was beginning drilling operations for Chevron.

According to the operator, operations on the drillship have been shut down. There were no other injuries reported and personnel remain on the drill ship. There was no reported pollution.  

No details of the circumstances of the fatality have been released.

BSEE and U. S. Coast Guard inspectors traveled to the drillship yesterday and began collecting evidence and taking statements. The incident will be investigated by both BSEE and the U. S. Coast Guard.

Ostensjo picks Rolls-Royce design for wind farm vessel

The vessel will service a five year contract from DONG Energy that will see it act as a mother ship for wind turbine technicians as they perform maintenance work on Race Bank Offshore Wind Farm in the U.K. The contract will commence September 1, 2017 and includes an option for a five year extension

“This contract enables us to expand our business into the renewable energy sector,” says Østensjø Rederi CEO Johan Rokstad. “It has been the strategy of Østensjø Rederi to diversify our operations. Thus, we are pleased that DONG Energy has awarded us this exciting opportunity in a sector we believe will have further demands for similar vessels in the near future.”

The vessel is the twelfth ordered from Astilleros Gondan by Østensjø Rederi. It will be designed and equipped by Rolls-Royce and will be the first to be built to a new UT 540 WP ship design from Rolls-Royce developed specifically to support operations in shallow waters at offshore wind farms.

SOV 700

“We have worked closely with Rolls-Royce to develop a design we believe will be well suited to servicing the specific operational demands of supporting offshore wind farms,” says Mr. Rokstad. “We look forward to continuing this good cooperation in carrying the project through to completion.”

The ship is designed with a high focus on seakeeping capabilities, excellent station keeping performance, improved comfort and safety on board, and reduced fuel consumption.

As well as designing the vessel, Rolls-Royce will supply the diesel electric main machinery, consisting of frequency controlled electric driven azimuth thrusters, super silent mounted transverse thrusters, DP2 dynamic positioning system, power electrical system, deck machinery, and the latest generation Acon automation and control system.

Helge Gjerde, Rolls-Royce, President Commercial – Marine, said, “We are delighted that Østensjø Rederi and DONG Energy have chosen the new Rolls-Royce UT 540 WP design against intense competition. As more wind farms are built further from shore and in more demanding conditions we see opportunities to use our extensive offshore experience to diversify into an exciting new market.”

The new build is a DP2 Service Operation Vessel with high station keeping capacities. 60 single cabins of high standard can accommodate up to 40 wind turbine technicians in addition to a marine crew of 20. A motion compensated gangway system with an adjustable pedestal will be installed to ensure safe operations and optimal uptime. Special areas and functions of the vessel are made in accordance with the charterer`s requirements. The 81.0 m long vessel, with a beam of 17.0 m, will work out of Grimsby, U.K.

“The Service Operating Vessel will be an important step to ensure safe and efficient operation of wind farms far from shore, starting with Race Bank windfarm, and we are convinced that DONG Energy will benefit from Østensjø Rederi’s long experience in conducting safe operations in an offshore environment,” says Jens Jakobsson, Senior Vice President for Wind Power Operations in DONG Energy

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