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Transocean Ltd. (

RIG

)

Q4 2010 Earnings Call

February 24, 2011 10:00 pm ET

Executives

Gregory Panagos – Vice President of Investor Relations and Communications.

Steven L. Newman – President and Chief Executive Officer

Terry B. Bonno – Vice President, Marketing

Ricardo H. Rosa – Senior Vice President, Chief Financial Officer

Ihab Toma – Executive Vice President, Global Business

Analysts

Robin Shoemaker – Citigroup Inc.

Angie Sedita – UBS

Collin Gerry – Raymond James

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Michael Urban – Deustche Bank

Scott Gruber – Bernstein

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Geoff Kieburtz – Weeden & Company

Kurt Hallead – RBC Capital Markets

Judson Bailey – Jefferies & Co.

Ian Macpherson – Simmons & Company International

Presentation

Operator

Good day, everyone. Welcome to the Fourth Quarter 2010 results conference call for Transocean. Today’s conference is being recorded.

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At this time, for opening remarks and introductions, I would like to turn the conference over to Mr. Gregory Panagos, Vice President of Investor Relations and Communications.

Gregory Panagos

Thank you, [Treeka]. Good morning and welcome to Transocean’s fourth quarter and full year 2010 earnings conference call. A copy of the fourth quarter press release covering our financial results along with supporting statements and schedules is posted on the company’s website at deepwater.com.

We've also posted a file containing flowcharts that will be discussed during this morning's call. That file can be found on the company’s website by selecting Investor Relations, Quarterly Toolkit and then PowerPoint Charts.

The charts included cover first average contracts at day rates by rig type, out of service rig months, operating and maintenance cost trends and finally free cash flow backlog and debt maturities. The Quarterly Toolkit also has four additional financial tables for your convenience covering revenue efficiency, other revenue details, daily operating and maintenance costs by rig type and contract intangible revenues.

Joining me on this morning’s call are Steven Newman, our Chief Executive Officer; Ricardo Rosa, Senior Vice President and Chief Financial Officer; Ihab Toma, Executive Vice President, Global Business and Terry Bonno, Vice President of Marketing.

Before I turn the call over to Steven, now I would like to point out that during the course of this conference call, participants may make certain forward-looking statements regarding various matters related to our business and company that are not historical facts, including future financial performance, operating results and the prospects for the contract drilling business.

As you know, it is inherently difficult to make projections or other forward-looking statements in a cyclical industry, since the risks, assumptions and uncertainties involved in these forward-looking statements include the level of crude oil and natural gas prices, rig demand and operational and other risks, which are described in the company’s most recent Form 10-K and other filings with the U.S. Securities and Exchange Commission.

Should one or more of these risks and uncertainties materialize or underlying assumptions prove incorrect, actual results may vary materially from those indicated. Also note that we may use various numerical measures on the call today that are or may be considered non-GAAP financial measures under Regulation G.

As I indicated earlier, you will find the required supplemental financial disclosure for these materials, including the most directly comparable GAAP measure and an associated reconciliation on our website at deepwater.com under Investor Relations, Quarterly Toolkit, and Non-GAAP Financial Measures and Reconciliations.

Finally, in order to give more people an opportunity to ask questions, please limit your questions to one initial question and one follow-up. Thank you.

That concludes the preliminary details and now I’ll turn the call over to Steven.

Steven L. Newman

Thanks Greg. Hello, everyone, and thank you for joining us today. Our reported fourth quarter earnings were a net loss of $2.51 per diluted share. After adjusting for the items highlighted in our press release, diluted earnings per share would have been $0.68.

Before I turn the call over to Ricardo to provide some additional insight into the fourth quarter numbers, and our guidance for 2011, I want to make a couple of comments on 2010 and the company and our business.

During 2010 company faced unprecedented challenges and I want to thank our employees and our shareholders with unlimbering support, their commitment to a company and their compassion for their colleagues.

Our internal investigation into the events of the Macondo tragedy is nearing completion. However in light of continuing delays in obtaining information on the third-party testing of the Horizon’s BOP we expect to release the findings of our investigation in the next month or two.

We continue to work closely with our customers to help ensure the industry benefits from the lesson learned from this tragedy and then implements any necessary improvements to ensure doesn’t happen again. Improved safety is the best way we can honor the memories of those we lost last April.

As we look forward, we also on our commitment to never forget the events of the past. As the industry moves forward following Macondo, there is understandably increased scrutiny on all aspects of drilling operations including the performance in reliability of well control equipment.

While we believe that our subsea equipment on the Horizon functioned as designed, we have adopted and enhanced to approach to maintaining and operating well controlled equipment, particularly subsea BOPs on our floating rigs.

We have implemented more expenses between well’s maintenance and we are stress testing subsea BOPs to new levels before they are deployed on each new locations. In the short-term, this is resulting in some incremental out-of-service time and also impacting our revenue efficiency.

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