Operating profit amounted to USD 83 million, which is the best ever quarterly result, and net profit amounted to USD 72 million. Prosafe expects a good long-term demand for semi-submersible accommodation rigs, with stable activity in the North Sea and Mexico and growth in deepwater regions.
Financials
(Figures in brackets refer to the corresponding period of 2009)
Operating profit for the third quarter amounted to USD 83.0 million (USD 77.1 million), which is the best quarterly result ever for Prosafe. Utilisation of the rig fleet was 80 per cent (96 per cent). The main contributing factor to the improved result is higher day rates.
Safe Lancia was in operation in Mexico until 6 August, and commenced a new contract in Mexico on 19 August.
Safe Caledonia was in operation until mid-September, whereas Safe Concordia and Safe Astoria were idle in the third quarter.
All other eight rigs have been fully utilised in the third quarter.
Net financial costs amounted to USD 6.4 million (USD 8.4 million). This improvement reflects a higher increase in market value of currency forwards.
Taxes amounted to USD 4.6 million (USD 2.4 million), and net profit equalled USD 72.0 million (USD 66.3 million), corresponding to diluted earnings per share of USD 0.32 (USD 0.30).
Total assets at 30 September amounted to USD 1 389.7 million (USD 1 420.3 million), while the book equity ratio increased to 28.8 per cent (17.3 per cent).
Dividend
The Board of Directors resolved on 3 November 2010 to declare an interim dividend equivalent to USD 0.095 per share to shareholders of record as of 15 November 2010. The shares will trade ex-dividend on 11 November 2010. The dividend will be paid in the form of NOK 0.55 per share on 25 November 2010.
Outlook
Five of Prosafe's rigs are bareboat chartered to Interpetroleum Services, operating for Pemex offshore Mexico. These five rigs have firm contracts as follows: Safe Lancia until December 2012, Jasminia until June 2011, Safe Hibernia until May 2011, Safe Britannia until January 2013 and Safe Regency until August 2013.
Safe Esbjerg is operating for Maersk in the Danish North Sea until June 2011.
Safe Caledonia will commence on a contract with BG in the UK North Sea in the beginning of March 2011.
MSV Regalia is operating for BP in the Norwegian North Sea. The contract with BP has a firm duration until July 2011. On request from BP, MSV Regalia is going to be temporarily changed out with Safe Scandinavia from mid-November through to mid-March.
Safe Scandinavia has a six-month firm contract with Statoil commencing early April 2011.
Safe Concordia has been awarded a Letter of Intent by Petróleo Brasileiro S.A. (Petrobras) for a three year period, planned to commence early in the second quarter of 2011.
Safe Bristolia and Safe Astoria are currently idle.
In the North Sea, the majority of fixed installations are mature and require both maintenance and modifications to keep up production and ensure safe operations. Improved oil recovery (IOR) projects and tie-ins of satellite fields to existing installations have extended the lifetime for many fields in the North Sea. Therefore, we foresee a good outlook for modification, IOR and maintenance projects over the coming years.
During the last two quarters we have seen several contract awards for accommodation work in the North Sea for 2011 and 2012. Going forward, we see potential projects requiring additional accommodation in the North Sea in 2011, 2012 and 2013.
The market for semi-submersible accommodation rigs is still strong in Mexico, where Pemex has high offshore activity in order to keep up production at the Cantarell field. Prosafe has five rigs operating in Mexico and we expect a stable development going forward.
During the third quarter, we have seen two awards for semi-submersible rigs offshore Brazil. These awards confirm that Brazil is a growing market for safety and maintenance support services.
Within the harsh and semi-harsh offshore environments where most of Prosafe's accommodation rigs operate, there is a good supply-demand balance.
In summary, we expect a good long-term demand for semi-submersible accommodation rigs, with stable activity in the North Sea and Mexico and growth in deepwater regions.
Prosafe is the world's leading owner and operator of semi-submersible accommodation/service rigs. Operating profit reached USD 218.6 million in 2009. The company operates globally, employs approx. 400 people and is headquartered in Larnaca, Cyprus. Prosafe is listed on the Oslo Stock Exchange with ticker code PRS. For more information, please refer to www.prosafe.com.
Attachments: Q3 2010 report, Q3 2010 presentation
Larnaca, 4 November 2010
Prosafe SE
For further information, please contact:
Karl Ronny Klungtvedt, Chief Executive Officer
Phone: +357 9968 8169
Martin Kolnes, Vice President and Chief Financial Officer
Phone: +357 9968 8991
Cecilie Ouff, Finance and IR Manager
Phone: +47 99 10 94 67
