Several new contracts and an order for a newbuild jack-up in the second quarter of 2012 reinforce Maersk Drilling’s growth strategy and its ambition to become a significant and stable contributor to the A.P. Moller – Maersk Group’s profit.
Maersk Drilling’s profit in the second quarter of 2012 was USD 101 million (USD 99 million in the second quarter of 2011). The result was positively impacted by reversal of impairments of USD 30 million and negatively impacted by two rigs requiring extensive maintenance and upgrade before start-up of operations.
Maersk Drilling continues to see a strong demand for its advanced drilling rigs. In the second quarter Maersk Drilling secured several contracts including a four year USD 620 million contract for a newbuild jack-up and a three-year USD 610 million contract for the first drillship under construction. By the end of the second quarter Maersk Drilling had a contract coverage of 94% for the remainder of 2012, 86% for 2013 and 65% for 2014 providing a high degree of earnings visibility.
“We are on track in terms of our accelerated growth strategy and the market outlook remains very encouraging. On the negative side we have experienced some unexpected challenges in terms of start-up issues on two rigs. Fortunately these issues have now been solved,” says Claus V. Hemmingsen, CEO of Maersk Drilling and member of the Executive Board of the A.P. Moller – Maersk Group.
Medium term target: USD 1 billion profit
Maersk Drilling is one of the four strategic core business units in the A.P. Moller – Maersk Group prioritized for investments. Maersk Drilling’s medium term financial ambition is to deliver USD 1 billion to the Group’s profit by growing its business within the ultra harsh environment jack-up and ultra deepwater floater segments.
In line with this strategy Maersk Drilling in the second quarter of 2012 ordered a new jack-up for USD 650 million. This order adds to an order book of six rigs including two ultra harsh jack-ups and four ultra deepwater drillships, and brings the total committed investment in Maersk Drilling since 2011 up to USD 4.5 billion. The newbuild rigs will be delivered in 2013-15.
“There is great potential in the markets we are positioned in. I am confident that we will be able to grow our business with our customers and to become an important player in our industry, all while delivering on our ambitious financial target,” says Claus V. Hemmingsen.
Press Release, August 15, 2012