NEW YORK, Dec. 29, 2024 (GLOBE NEWSWIRE) -- Attorney Advertising -- Bronstein, Gewirtz & Grossman, LLC, a nationally recognized law firm, notifies investors that a class action lawsuit has been filed against Transocean Ltd. (“Transocean” or “the Company”) (NYSE: RIG) and certain of its officers. Class Definition This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Transocean s ...

Transocean Ltd. (RIG) recently announced its $111 million contract extension with India-based Reliance Industries Limited, secured for its deepwater drillship, Dhirubhai Deepwater KG1. The contract lays down a 270-day program that will commence immediately after the existing contract. The immediate continuation of drillship services after the existing contract will minimize the idle time of the rig, enhance operational efficiency, optimize the rig’s utilization and strengthen Transocean’s foothold in the As ...

STEINHAUSEN, Switzerland, Dec. 17, 2024 (GLOBE NEWSWIRE) -- Transocean Ltd. (NYSE: RIG) (“Transocean”) today announced that a four-well option was exercised for the Dhirubhai Deepwater KG1 with Reliance Industries Limited in India. The estimated 270-day program is expected to commence in direct continuation of the rig’s firm term with Reliance and contribute approximately $111 million in backlog, excluding additional services. About Transocean Transocean is a leading international provider of offshore contr ...

Core Insights - Transocean's management provided commentary on the company's quarterly results, highlighting their outlook and future expectations [1]. Group 1 - The focus of the analysis is on management's outlook and comments regarding the company's performance [1].

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Core Insights - Transocean Ltd. reported breakeven adjusted earnings per share for Q3 2024, surpassing the Zacks Consensus Estimate of a loss of 4 cents and improving from a loss of 36 cents in the prior year [1] - Total adjusted revenues reached $948 million, exceeding the Zacks Consensus Estimate of $936 million and reflecting a 31.5% increase from $721 million in the previous year [2] Revenue Performance - Revenues from Ultra-deepwater floaters contributed $668 million, while Harsh Environment floaters accounted for $280 million, both showing significant year-over-year growth from $516 million and $197 million, respectively [4] - Ultra-deepwater revenues surpassed the model projection of $684 million, and harsh environment revenues exceeded the projection of $256.2 million [4] Segmental Revenue Breakdown - Ultra-deepwater floaters represented 70.5% of net contract drilling revenues, while Harsh Environment floaters made up 29.5% [3] Operational Metrics - Average day rates increased to $436,800 from $391,300 in the year-ago quarter, although this figure fell short of the Zacks Consensus Estimate of $491,300 [5] - Fleet utilization rate improved to 63.9% from 49.4% in the prior year [6] Cost and Financials - Total costs and expenses were reported at $800 million, a 5.3% increase from $760 million in the previous year [7] - Cash and cash equivalents stood at $435 million as of September 30, 2024, with long-term debt at $6.5 billion and a debt-to-capitalization ratio of 38.9% [7] Future Guidance - Management anticipates contract drilling revenues for Q4 2024 to be between $950 million and $970 million, with additional revenues from services expected to be $55 million to $60 million [9][10] - For 2025, contract drilling revenues are projected to be between $3.85 billion and $4 billion, with additional services expected to contribute $220 million to $230 million [13] Expense Projections - Fourth-quarter O&M expenses are expected to be approximately $585 million, reflecting an increase due to deferred maintenance costs [11] - General and administrative expenses are projected to be between $50 million and $55 million [12] Long-term Financial Strategy - The company aims for a debt reduction target of $715 million by 2026, with a goal to reduce gross debt to around $6.2 billion [16] - A leverage ratio target of below 3.5x is set as a prerequisite for considering shareholder distributions [16]

I am mostly a trader engaging in both long and short bets intraday and occasionally over the short- to medium term. My historical focus has been mostly on tech stocks but over the past couple of years I have also started broad coverage of the offshore drilling and supply industry as well as the shipping industry in general (tankers, containers, drybulk). In addition, I am having a close eye on the still nascent fuel cell industry.I am located in Germany and have worked quite some time as an auditor for Pric ...

Acquisitions and Sales - In June 2024, Transocean acquired a 67.0% ownership interest in Orion Holdings for noncash consideration valued at $431 million, including $130 million in senior notes and 55.5 million shares[62]. - In February 2024, Transocean sold two harsh environment floaters for net cash proceeds of $49 million, and in July 2024, sold an ultra-deepwater floater for $53 million[62]. - In September 2024, Transocean executed agreements for the sale of two ultra-deepwater floaters with expected net cash proceeds of $345 million, recognizing a loss of $629 million associated with their impairment[62]. - During the nine months ended September 30, 2024, the company completed the sale of one ultra-deepwater floater and two harsh environment floaters, with plans to sell two additional ultra-deepwater floaters[86]. Financial Performance - A loss of $143 million was recognized in the nine months ended September 30, 2024, due to impairment of rig and related assets classified as held for sale[62]. - The company reported contract drilling revenues of $948 million for the three months ended September 30, 2024, a 33% increase from $713 million in the same period last year[74]. - Contract drilling revenues for Q3 2024 increased by approximately $481 million (23%) to $2,572 million compared to Q3 2023[78]. - For the nine months ended September 30, 2024, contract drilling revenues increased by approximately $305 million due to higher utilization[79]. - The company reported a net loss of $519 million for the nine months ended September 30, 2024, an improvement from a net loss of $850 million in the same period of 2023, reflecting a change of $331 million[82]. Debt Management - Transocean issued $900 million in senior notes due May 2029 and $900 million in senior notes due May 2031, receiving $1.77 billion in cash proceeds[63]. - The company used $2,073 million for debt repayments, an increase of $366 million from $1,707 million in the previous year[84]. - The fair value of the company's outstanding debt was $7.03 billion as of September 30, 2024, and $7.31 billion as of December 31, 2023[94]. - The company is actively managing its debt portfolio through retirements and new issuances to optimize its capital structure[94]. Operational Metrics - As of October 24, 2024, Transocean operated 34 mobile offshore drilling units, including 26 ultra-deepwater floaters and eight harsh environment floaters[61]. - Rig utilization for ultra-deepwater floaters improved to 60.7% for the three months ended September 30, 2024, compared to 45.0% in the same period of 2023[73]. - Average daily revenue for ultra-deepwater floaters was $426,700 for the three months ended September 30, 2024, compared to $406,500 for the same period in 2023, reflecting a 4.3% increase[71]. - The total fleet average daily revenue rose to $436,800 for the three months ended September 30, 2024, up from $391,300 in the same period last year, marking a 11.6% increase[72]. Future Outlook - The company expects robust demand for oil and gas due to population growth and improved living standards in non-OECD countries, contributing to increased energy demand[66]. - The contract backlog for ultra-deepwater floaters increased to $7,144 million as of October 24, 2024, up from $6,666 million in July 2024[70]. - The company anticipates demand for harsh environment floaters to accelerate through at least 2028, with contract durations likely to favorably influence dayrates[66]. - The uncommitted fleet rate for ultra-deepwater floaters is projected to be 37% in 2024, increasing to 87% by 2028[68]. Expenses and Cash Flow - Operating and maintenance expenses increased by $203 million (14%) to $1,620 million in Q3 2024 compared to Q3 2023[78]. - Net cash provided by operating activities increased to $241 million, up from $66 million in the prior year, primarily due to increased cash collected from customers[82]. - Capital expenditures for the nine months ended September 30, 2024, were $225 million, compared to $207 million in 2023, indicating an increase of $18 million[83]. - The company expects to utilize existing cash balances and cash flows from operating activities to meet anticipated near-term obligations, including capital expenditures and scheduled debt maturities[85].

Financial Data and Key Metrics Changes - For Q3 2024, Transocean reported adjusted EBITDA of $342 million on contract drilling revenues of $948 million, resulting in an adjusted EBITDA margin of approximately 36% [8][41] - The company experienced a net loss attributable to controlling interest of $494 million, equating to a net loss of $0.58 per diluted share [41] - Total liquidity at the end of Q3 2024 was approximately $1.4 billion, including $435 million in unrestricted cash and cash equivalents [44] Business Line Data and Key Metrics Changes - Contract drilling revenues were slightly above guidance due to extended operations of the Deepwater Invictus and shorter out-of-service durations for other rigs [42] - Operating and maintenance expenses were $563 million, below guidance due to delays in non-critical maintenance activities [43] - The average daily revenue for contract drilling was approximately $437,000 [42] Market Data and Key Metrics Changes - The active fleet utilization for 2025 exceeds 97% and remains at roughly 86% through the first half of 2026 [15] - The company secured $1.3 billion in recent contract awards, increasing total backlog to $9.3 billion, a 7.5% sequential increase [21] - Global upstream CapEx is forecasted to remain flat at just under $500 billion per year, with deepwater investment expected to grow from 12% in 2024 to 15% in 2026 [25] Company Strategy and Development Direction - The company aims to convert its $9.3 billion backlog to revenue and cash, focusing on financial stability and potential shareholder distributions by late 2026 [37][51] - Transocean emphasizes the importance of owning and operating a high-specification rig fleet, which has proven to be a successful strategy through market cycles [17][22] - The company is actively engaged in discussions for projects beginning in 2026 and beyond, indicating a focus on long-term growth [26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the longevity of the current upcycle, supported by market studies and customer discussions [24] - The company noted that the breakeven cost for deepwater projects is around $40 per barrel, allowing customers to remain profitable even with lower oil prices [105] - Management highlighted that premium assets attract premium day rates, and the company is well-positioned to capitalize on this trend [22][23] Other Important Information - The company has implemented Critical Operations Authorization Centers to improve operational reliability, achieving a 20% improvement in operational reliability since their establishment [32][33] - There have been some reliability issues related to new 20,000-psi blowout preventers, but management is confident in resolving these challenges [34][75] Q&A Session Summary Question: Expectations on day rates trajectory for next year - Management indicated that their average fixture for 1,400-ton class rigs has been around $520,000, suggesting stability in day rates despite potential soft spots in the market [55][60] Question: Thoughts on industry consolidation - Management believes consolidation is healthy for the industry and sees room for more, emphasizing the benefits of combining assets for operational efficiency [70][72] Question: Clarification on BOP reliability issues - Management acknowledged the reliability challenges as part of the commissioning process for new technology, but expressed confidence in resolving these issues quickly [74][75] Question: Underlying cost inflation in 2025 guidance - Management noted an average inflation rate of 3% for 2025, with higher inflation observed in specific jurisdictions and activities [79][81] Question: Incremental demand in Namibia - Management indicated that both drillships and semisubmersibles are being discussed for projects in Namibia, depending on environmental conditions [82][84] Question: Decision process for stacking rigs - Management highlighted their historical approach to reducing excess capacity and emphasized the importance of asset quality in making decisions about rig utilization [87][91]

Core Insights - Transocean reported break-even quarterly earnings per share, exceeding the Zacks Consensus Estimate of a loss of $0.04, and showing improvement from a loss of $0.36 per share a year ago, resulting in an earnings surprise of 100% [1] - The company posted revenues of $948 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 1.26% and showing a year-over-year increase from $721 million [2] - Transocean shares have underperformed the market, losing about 38.3% since the beginning of the year compared to the S&P 500's gain of 22.3% [3] Financial Performance - Over the last four quarters, Transocean has surpassed consensus EPS estimates three times [2] - The current consensus EPS estimate for the coming quarter is $0.03 on revenues of $989.47 million, while for the current fiscal year, it is -$0.17 on revenues of $3.55 billion [7] Industry Outlook - The Oil and Gas - Drilling industry, to which Transocean belongs, is currently ranked in the bottom 18% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Transocean's stock performance [5][6] Future Expectations - The sustainability of Transocean's stock price movement will largely depend on management's commentary during the earnings call and the subsequent revisions of earnings estimates [3][4] - Another industry player, Seadrill, is expected to report quarterly earnings soon, with a significant year-over-year decline anticipated, which may also influence market sentiment towards the sector [9][10]