Onshore contract drilling services provider Patterson-UTI Energy, Inc. (PTEN) Thursday reported a loss for the third quarter, as revenues more than halved on lower levels of drilling activity. The loss, however, was narrower than market estimates, sending the shares higher by more than 10% in morning trade.
Net loss for the quarter was $18.6 million or $0.12 per share, compared with a net income of $109 million or $0.69 per share in the previous year.
On an average, 24 analysts polled by Thomson Reuters expected the company to report loss of $0.16 per share for the quarter. Analysts' estimates typically exclude special items.
The Houston, Texas-based company's third quarter revenues were $176 million, much lower than $609 million generated last year. Fourteen analysts had estimated revenues of $162.59 million.
In the sequentially preceding second quarter, the company had posted a net loss of $17.74 million or $0.12 per share as against a net profit of $81.42 million or $0.52 per share in the second quarter of fiscal 2008. Second quarter revenues plunged to $160.76 million from $526.28 million in the prior-year quarter.
For the third quarter, revenues from Contract Drilling plummeted to $112.29 million from $498.51 million in the previous year. Revenues from Pressure Pumping declined to $41.69 million from $60.62 million, whereas Drilling and Completion Fluids revenues were $16.49 million, down from $35.73 million in the prior year.
Revenues from Oil and Natural Gas Production and Exploration dropped to $5.69 million from $13.67 million in a year ago.
Patterson's average number of rigs operated for the quarter were 73, much lower than 276 rigs operated in the prior-year quarter. Average revenue per operating day for the quarter was $17 thousand, down from $20 thousand last year. Operating days for the quarter declined to 7 thousand from 25 thousand in the previous year.
For the nine-month period, net loss was $20.1 million or $0.13 per share, compared with a net income of $268 million or $1.71 per share in the comparable period. Year-to-date, revenues plunged to $633 million from $1.64 billion a year ago.
The company has declared a dividend on its common stock of $0.05 per share, to be paid on December 30 to holders of record as of December 15, 2009.
Patterson added that during the quarter the company had an average of about 28 rigs operating under term contracts, and expects to have an average of approximately 33 rigs under term contracts for the remainder of the year, and approximately 34 rigs in 2010 and 21 rigs in 2011 under existing long-term contracts.
Mark Siegel, Chairman, said, "We are continuing to experience an increase in demand for our rigs as customers prepare for increased drilling activities in 2010. Consistent with the increase in demand, our spot market dayrates stabilized during the third quarter and have recently started to increase."
Among competitors, Nabors Industries Ltd. (NBR) on October 20 reported lower net income for the third quarter on weak demand. The Hamilton, Bermuda-based company posted net income of $29.5 million or $0.10 per share, compared to $194.0 million or $0.67 per share in the prior year quarter. Revenues were $803.57 million, down from $1.44 billion in the same quarter last year.
Another peer Precision Drilling Trust (PDS) on October 22 reported a 13% decline in third-quarter earnings to C$72 million from C$82 million in the prior year quarter, on revenues of C$253 million compared to C$285.6 million. Lower earnings reflected higher finance charges and a weak global economy that lead to low energy commodity prices.
PTEN is currently trading at $16.88, up 8.07% on a volume of about 3.7 million shares on the Nasdaq. In the past 52-week period, the stock has been trading in a range of $7.49 to $18.07.
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