Q2 2024 Odfjell Drilling Ltd Earnings Call Transcript
Key Points
- Odfjell Drilling Ltd (ODFJF) achieved a high financial utilization rate of 98% for its own fleet, contributing to an EBITDA of $85 million from a revenue of $191 million.
- The company secured a significant contract with Equinor for the Deepsea Aberdeen, valued at $121 million, extending its backlog until early 2027.
- Odfjell Drilling Ltd (ODFJF) successfully completed the Deepsea Atlantic SPS and upgrade project ahead of schedule and within budget, enhancing the rig's capabilities.
- The company's order backlog increased to $2.1 billion, with all units having firm backlog until at least mid-2026.
- Odfjell Drilling Ltd (ODFJF) declared a quarterly dividend of $0.06 per share, with plans to increase future dividends as units transition to higher day rate contracts.
- The company's net profit for Q2 was $16 million, which may be considered modest relative to its revenue and EBITDA figures.
- Odfjell Drilling Ltd (ODFJF) faces potential competition from benign units in West Africa, which could impact day rates for harsh environment rigs.
- The company has ongoing CapEx commitments, with significant payments expected for the remaining SPS programs, potentially impacting cash flow.
- There is uncertainty regarding the timing of the Deepsea Aberdeen SPS, which could affect operational schedules and financial projections.
- Despite a positive outlook, the company acknowledges the need for careful management of M&A opportunities to ensure they are accretive for shareholders.
Good afternoon, everybody, and welcome to the Odfjell Drilling Q2 2024 Results Presentation. My name is James Crothers, and I'm an Investor Relations Officer of the company. And I'm joined today by our Chief Executive Officer, Kjetil Gjersdal; and our Chief Financial Officer, Frode Syslak.
Before we begin, your attention is brought to the important information slide of our presentation, which would encourage participants to read info. Note that the presentation is only a summary of the quarter and the more comprehensive quarterly report should be read separately. Both that report and today's presentation are available on our website, www.odfjelldrilling.com.
Our call today will begin with a brief summary of the quarter with Kjetil taking us through some of the key highlights. We'll then move on to discussing our operations during Q2 and then move on to our financial review with Frode. We will then summarize the presentation and close the call.
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