Cameron reported earnings per share for the second quarter of 2013 of $0.79, excluding charges. After-tax charges for the second quarter of 2013 were $0.22 per share, including the following unusual items:
· Tax consequences related to the formation of OneSubsea $ 0.10
· Other costs, primarily related to the formation of OneSubsea $ 0.11
· Foreign currency losses during the quarter $ 0.01
The Company reported GAAP net income of $140.4 million for the quarter, or $0.57 per diluted share. This compares to GAAP net income of $174.6 million for the second quarter of 2012, or $0.70 per diluted share.
Year-over-year revenues increase
Revenues were $2.3 billion for the quarter, up 11 percent from $2.1 billion a year ago, representing the Company’s second highest revenue quarter. Cameron Chairman, President and Chief Executive Officer Jack B. Moore said that the year-over-year revenue increase was due to gains in the DPS business segment. Moore commented, “Our drilling, surface and subsea systems businesses each reflected year-over-year revenue improvements due to our record backlog position.”
Orders total $2.3 billion; OneSubsea and surface systems awards received after quarter end
Second quarter orders did not reflect any significant subsea or drilling systems awards, such as were seen in the previous two record quarters. Notwithstanding, total orders for the quarter were $2.3 billion. Moore said, “ Record North American surface orders, continued robust drilling aftermarket and strong distributed valve orders were noted in the quarter. ” He stated that the Company is still expecting a record year in bookings.
Following the end of the second quarter, a $540 million order was received from Chevron for OneSubsea equipment for the Rosebank development in the UK North Sea. In addition, BHP Billiton and Cameron surface systems entered into a multi-year CAMSHALE frame agreement with an estimated value of $550 million. This represents the latest of 14 surface systems frame agreements the Company has received.
Cameron’s backlog at the end of the second quarter was $10.5 billion, its highest historical level. This was up from the prior year level of $7.5 billion, and the beginning of the year level of $8.6 billion. Moore noted, “ Each of our DPS businesses are at all-time record backlogs while the Company’s overall record backlog is up 41 percent from last year.”
Capital investment and share repurchases continue
Moore said he expects Cameron to generate meaningful cash flow from operations for the full year. He also noted that capital spending will approximate $500 million in 2013, reflecting multiple opportunities for deployment of capital, including enhanced exposure to North American resource plays and expansion of facilities and investment in the drilling and aftermarket services businesses. The Company also acquired 1.5 million of its shares during the second quarter.
Full year earnings guidance revised, reflecting timing of newly added OneSubsea businesses
Moore said that Cameron’s third quarter earnings are expected to be in the range of $0.80 to $0.85 per diluted share excluding charges. He noted the Company anticipates that full-year 2013 earnings are expected to be in the range of $3.40 to $3.55 per share excluding charges, down from previous full year guidance. Moore stated, “ We revised our full year guidance primarily as a result of later than expected bookings for the newly added OneSubsea businesses. A number of large project awards shifted to later periods and this has impacted their projected earnings for the remainder of 2013. ”
[mappress] Press Release, July 25, 2013