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Diamond Offshore Drilling Inc DO
Q1 2011 Earnings Call Transcript

Transcript Call Date 04/21/2011

Operator: Good morning. My name is Julian and I will be your conference operator today. At this time, I would like to welcome everyone to the Diamond Offshore Drilling First Quarter 2011 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

Thank you. I would now like to turn the conference over to Mr. Les Van Dyke, Director of Investor Relations. Please go ahead, sir.

Les Van Dyke - Director of IR: Good morning, and thank you for joining us. With me on the call today are Larry Dickerson, President and Chief Executive Officer; Gary Krenek, Senior Vice President and Chief Financial Officer, Mo Plaisance, Vice President of Marketing; and Michael Acuff, Vice President of Marketing.

A discussion of the risk factors that could impact these areas and the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission. Given these concerns, investors and analysts should not place undue reliance on forward-looking statements. The Company expressly disclaims any obligation publicly to update any forward-looking statements to reflect any changes in the Company's expectations or any changes in events, conditions or circumstances on which any forward-looking statement is based.

After we have discussed our results, we will have a question-and-answer session during which we ask that you please limit yourself to one question and one follow-up, so that we can open the floor to as many people as possible.

With that, I will turn the meeting over to Larry.

Lawrence R. Dickerson - President and CEO: Thank you and good morning as well. We were very pleased with the operating results which we were able to report this morning. A couple of comments around that, we had some of the lowest unanticipated equipment downtime that we’ve recorded in many, many quarters fell from Q4 '10 of 142 days to only 72 days in Q1 of '11. Now we work very hard, we’ve got lots of programs dealing with. We're trying to do preventative maintenance such that we don't have this, but it is – we believe that that's related to that, but it is an event that will come and go. We were very pleased with that.

We also had a very low amount of shipyard and job preparation and (mode) time in the quarter only 168 days, which is down 100 days from Q4 '10 and significantly from Q3 '10 where we over 570 days in that nature. So, more effective day rate utilization out there through a combination of preventative maintenance to prevent things from breaking and a schedule where for this quarter and Gary will talk little bit about as we look to the next quarter. We actually have very few rig moves or contract preps or scheduled shipyard time, all of which benefits this greatly.

Now having said that, I would point out that we have three big rigs that are scheduled to return to work or begin recognizing higher revenue in the coming quarter. I will start with the Ocean Monarch, which has been the ideal really since shortly after the events of a year ago. Today, we have an approximate 60 day job with Marathon in the 290s where we will be working here in the Gulf of Mexico.

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