If this is what a trough quarter looks like, then Rowan Companies (NYSE:RDC) ought to have a bright future indeed.
The contract driller and manufacturer, which is quite levered to the shallow water drilling market, naturally had some less-than-stellar results to report for the period ended Sept. 30. In the drilling business, revenue dropped 28% from the prior year, margins eroded a touch, and income was cut in half.
How does that stack up to peers? Well, we saw Hercules Offshore's (NASDAQ:HERO) domestic offshore revenue plunge by 83%, contributing to a loss for the quarter. Pride International (NYSE:PDE) turned in a subpar performance of its own, with revenue off 17% and earnings from operations down 46%. Ensco International (NYSE:ESV) saw revenue drop more than 30% and per-share earnings nearly halved.
Hercules, working for relative table scraps for Gulf of Mexico operators like Chevron (NYSE:CVX) and Stone Energy (NYSE:SGY), is an easy mark, but the Pride and Ensco comparisons are rather interesting. Pride, with a fleet stuffed full of deepwater rigs, barely fared any better than Rowan. Ensco, which I've championed for a long time now, only ever-so-slightly bested Rowan's 59% offshore utilization.
So well done there, Rowan. I knew you had great depth. Whenever the market turns (recent increased bidding activity for premium jackups in the U.K. North Sea is a good start), you'll benefit handsomely. In the meantime, it's nice to see that Rowan can do better than just tread water.
