NADL - North Atlantic Drilling Ltd. reports first quarter 2016 results

Highlights from the first quarter

• North Atlantic Drilling generated first quarter 2016 EBITDA of $87.3 million

• North Atlantic Drilling reports first quarter 2016 net loss of $6.1 million and net loss attributable to shareholders of $9.9 million. The loss per share was $0.41

Financial highlights

First quarter 2016 results

Consolidated revenues for the first quarter 2016 were $151.6 million compared to $150.4 million for the fourth quarter of 2015. The primary reason for the increase is the West Phoenix returned to drilling operations on March 6, 2016 after concluding its idle period under contract which began in the fourth quarter.

Operating income for the first quarter was $33.0 million, an increase of $94.1 million compared to the fourth quarter of 2015 operating loss of $61.1 million. The loss in the fourth quarter of 2015 was mainly attributable to the impairment loss on the West Rigel classified as held for sale, totaling $82m. The increase in operating income is also due to the West Phoenix returning to operations as stated above.

Net financial items for the first quarter of 2016 amounted to a charge of $35.1 million. The charge included $26.0 million in interest expenses and foreign exchange loss of $7.3 million, mainly related to the NOK1,500 million bond loan. The fourth quarter of 2015 incurred a net financial charge of $17.7 million, including interest expenses of $23.9 million, gain on financial derivatives of $0.7 million, and gain on foreign exchange of $8.6 million mainly related to the NOK1,500 million bond loan.

The income tax expense for the first quarter was a $4.0 million , compared to a $34.1 million in the fourth quarter of 2015 primarily due to deferred tax liabilities recorded on unremitted earnings in the fourth quarter of 2015.

Net loss for the first quarter was $6.1 million and net loss attributable to shareholders was $9.9 million, resulting in a basic loss per share of $0.41. This is compared to net loss of $112.9 million and a net loss attributable to shareholders of $116.9 million for the fourth quarter of 2015.

Balance sheet as at March 31, 2016

As at March 31, 2016, total assets decreased to $3,157.0 million from $3,255.1 million compared to the previous quarter.

Total current assets decreased to $243.5 million from $286.5 million compared to the previous quarter. The decrease  was mainly due to the fall in cash balances, partly offset by an increase in accounts receivables.

Total non-current assets decreased to $2,913.5 million from $2,968.6 million compared to the previous quarter. The decrease was mainly due to depreciation on drilling units.

Total current liabilities decreased to $444.2 million from $494.6 million compared to the previous quarter. The decrease is largely due to the decrease in related party payables and fall in other current liabilities.

Long-term interest bearing debt, including related party debt and current portion, decreased to $2,411.6 million from $2,434.9 million during the quarter.  Net interest bearing debt, after deducting cash and cash equivalents, increased to $2,324.2 million from $2,284.0 million.  During the first quarter the Company repaid net $42.0 million on the $2 billion credit facility, repaid net $12.0 million on the $475 million credit facility and reduced cash by $63.5 million.

Total equity decreased to $416.6 million from $418.7 million compared to the previous quarter. The decrease is primarily due to the net loss for the quarter, partly offset by other comprehensive gains on the pension plan.

Cash flow

As at March 31, 2016, cash and cash equivalents decreased to $87.4 million from $150.9 million compared to the previous quarter.

For the three-month period ending March 31, 2016, net cash used in operating activities was $15.0 million, net cash provided by investing activities amounted to $2.3 million, and net cash used in financing activities was $53.5 million. Cash from operations compared to the previous period mainly due to an increase in accounts receivables.

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

First Quarter 2016 fleet status
First Quarter 2016 report

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Source: North Atlantic Drilling Ltd. via Globenewswire

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