Dolphin Drilling (DDRIL) Q2 2024 earnings summary

Executive summary

• Achieved nearly perfect (99.5%) uptime and zero lost time incidents for Paul B. Loyd Jr., with successful integration of over 100 new personnel and strong safety records.

• All three core rigs are now contracted, with a firm revenue backlog of $431 million and $399 million in options, totaling $830 million including options.

• Streamlined fleet by selling Bideford and Leader rigs, generating $10 million in net cash and optimizing operations.

• Completed a $40 million equity raise, strengthening liquidity and supporting operations.

Financial highlights

• Q2 2024 revenues reached $16.4 million, up 62% sequentially, primarily from Paul B. Loyd Jr.; no revenue recognized for Blackford or Borgland.

• Q2 EBITDA was $(6.3) million, improved from $(17.0) million in Q1; net loss for the quarter was $(14.1) million.

• Cash and cash equivalents at June 30, 2024, were $54.5 million, including $28.2 million restricted; $20 million bond released in July.

• Total assets stood at $228.9 million, interest-bearing debt at $80 million, and total equity at $114.3 million.

• 1H 2024 operating revenues totaled $26.4 million, EBITDA was $(23.2) million, and net loss was $(30.9) million.

Outlook and guidance

• All rigs are contracted as of June 30, 2024, with 100% fleet contract coverage for 2025 and significant options extending into 2028.

• Blackford Dolphin to commence a 14-month contract in India in October 2024; arbitration with former Nigerian client ongoing.

• Borgland Dolphin to remain in Las Palmas for survey and maintenance, with contract start expected in early 2025.

• Medium-term outlook for offshore floaters is positive due to reduced global rig supply; UK market faces potential under-supply.

• Focus remains on securing additional contracts for Borgland after the EnQuest contract ends in August 2025.