Offshore driller Rowan Companies sank to a loss during the fourth quarter 2016 as its revenues dipped, driven by a decline in the deepwater and jack-up segment.
For the quarter ended December 31, 2016, Rowan on Friday reported a net loss of $24.4 million, compared to net income of $124.4 million in the fourth quarter of 2015.
The net loss for the current quarter included a $33.6 million (after tax) loss on extinguishment of $463.9 million of debt. The net income for the prior-year quarter included a gain on the sale of the jack-up rig Rowan Louisiana of $6.3 million (after tax), and a $1 million loss on extinguishment of debt (after tax).
Rowan’s revenues were $351.8 million in the fourth quarter of 2016, a decrease of 34% from the prior-year quarter and revenues of $535.8 million, driven by a 41% decline in the deepwater segment and a 30% decline in the jack-up segment.
According to the company, the deepwater decline resulted from the drillship Rowan Relentless being idle and the drillship Rowan Resolute operating at a reduced dayrate due to the blend and extend amendment to its contract. Jack-up revenues were impacted by lower utilization and lower dayrates.
Tom Burke, Rowan President and Chief Executive Officer, commented, “While we are cognizant that 2017 still presents many challenges, we are hopeful that the commodity price improvement and increase in potential drilling activity will guide our industry toward recovery.”