Valaris Limited reported its third-quarter 2024 financial results, with net income reaching $63 million, an increase from $25.5 million in the second quarter of 2024. Revenues exclusive of reimbursable items were $600 million, and total operating revenues were $643.1 million, beating consensus estimates by $22.98 million.
The company achieved a fleet-wide revenue efficiency of 98% during the quarter, demonstrating strong operational performance. Adjusted EBITDA increased to $150 million, up from $139 million in the prior quarter, and Valaris generated $111 million of free cash flow during the period.
Valaris added approximately $257 million in new contract backlog since its second-quarter earnings call, primarily for its jackup fleet. This included a three-year contract for VALARIS 118 with BP offshore Trinidad and a 300-day extension for VALARIS 117 offshore Mexico.
However, the company's GAAP EPS of $0.88 missed analyst estimates by $0.15. Valaris also noted the termination of contracts for VALARIS 147 and VALARIS 148, which were leased to ARO Drilling, following contract suspension notices from Saudi Aramco, leading to these rigs being stacked in the UAE alongside VALARIS 143.
Day rates for seventh-generation drillships continued to increase, averaging approximately $500,000 in the third quarter. The company repurchased $100 million of shares during the quarter, reaffirming its commitment to returning free cash flow to shareholders.
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