Hercules Offshore (HERO) shares are higher in Thursday’s pre-market session after the company posted a narrower-than-expected loss for Q4, though revenue fell short of analysts’ forecasts. The provider of shallow water drilling and marine services to the oil and natural gas exploration and production industry posted a Q4 GAAP net loss from continuing operations of $154.1 million, or $0.96 loss per share, compared with the prior-year period’s $100.8 million, or $0.63 loss per share.
The non-GAAP net loss from continuing operations was $37.1 million or $0.23 loss per share, versus net income from continuing operations of $22.5 million or $0.14 per share in the same quarter the previous year.Revenue was $178.7 million, down from $235.3 million in the same quarter last year. Analysts polled by Capital IQ were expecting a loss of $0.31 per share on revenues of $180 million.
The company’s CEO and president, John T. Rynd, stated, “The significant decline in crude oil prices during the fourth quarter exacerbated what was already a challenging environment in the U.S. Gulf of Mexico and a softening international drilling market. Poor industry conditions were reflected in our fourth quarter utilization rates, and we expect further weakness in both utilization and dayrates from our drilling operations in 2015, at least until commodity prices stabilize and improve from current levels. Furthermore, International Liftboats continue to suffer from curtailment of activity in Nigeria, which we expect will last at least through mid-2015. In response to the weaker demand environment, we have accelerated our cost cutting measures, which included cold stacking five rigs in the U.S. Gulf of Mexico and several other cost reduction measures across our organization.”
Shares rose 2.4% to $0.91, near the lower end of the 52-week range of $0.68 – $5.05, after declining some 8% in Wednesday’s regular session.