Hercules Offshore's 3Q Outlook Disappoints

HOUSTON (AP) — Offshore drilling services company Hercules Offshore Inc. on Wednesday forecast third-quarter revenue of $155 million to $160 million, below what analysts have been expecting.

Hercules also said it would offer up to 17.5 million shares of stock, with an option for underwriters to buy another 2.6 million additional shares. It said it would use the money to pay down debt on its term loan, and for general corporate purposes.

Hercules shares fell 67 cents, or nearly 11 percent, to $5.62 in late trading after the announcement, having closed earlier at $6.29.

The revenue projection came in below the $165.4 million in quarterly revenue expected by analysts surveyed by Thomson Reuters.

The company said bidding activity for domestic offshore and inland business increased this month after hitting a low in July, and that its backlog on domestic offshore work rose to 83 days as of Tuesday, up from 24 days on July 21. It said the hurricanes in 2005 and 2008 have made its domestic offshore business more seasonal, with customers reducing activity during the hurricane season from June 1 to Nov. 1.