Transocean posts $1.7B loss on jack-up fleet impairment

Offshore driller Transocean posted a net loss of $1,69 billion for the second quarter of 2017, compared to a net income of $82 million in the second quarter of 2016, dragged down by jack-up fleet impairment.

Revenues were $751 million, down from $940 million a year ago.

Second quarter 2017 results included net unfavorable items of $1,691 billion, of which most notably a $1,597 billion loss on the divestiture of the jack-up fleet and $113 million loss on impairment of primarily the midwater floater asset group.

To remind, Transocean in the quarter sold its whole jack-up rig fleet to Borr Drilling for $1.35 billion.

Excluding these net unfavorable items, Transocean’s net income for the second quarter was $1 million.

“We continue to safely and efficiently convert our industry leading $10.2 billion backlog into cash,” said Jeremy Thigpen, President and Chief Executive Officer. “Across our global fleet, we have now operated for 15 consecutive months without a single lost time incident. Our revenue efficiency, which is a close proxy for rig uptime, once again exceeded 97%.”

Thigpen added:”In addition to this excellent and consistent operating performance, during the quarter, we continued to further strengthen our balance sheet, including the private offering of $410 million in senior secured notes, the divestiture of the jack-up fleet for a total consideration of $1.35 billion, and a successful cash tender offer resulting in the repurchase of approximately $1.2 billion in existing notes with maturities between 2017 and 2021.”