Thursday, April 22, 2010

Diamond Offshore Drilling (NYSE:DO) Dividend Lowered

Diamond Offshore Drilling (NYSE:DO) reported earnings today and the results weren't pretty, as net income for the first quarter dropped by 17 percent.

This wasn't unexpected, and in fact beat analysts' estimates, as they were looking for $851 million revenue, with earnings per share of $1.93.

Diamond did better than that, generating revenue of $859.7 million, with earnings of $290.9 million, or $2.09 a share.

Higher costs related to drilling and lower revenue were cited as the reasons for the drop in earnings.

Last year in the same quarter the company had revenue of $348.6 million, or $2.51 a share.

Probably most concerning to shareholders was the drop in a special dividend for its common stock to $1.375 a share, only half of what the special dividend was before.

Other than industry conditions, Diamond said they want to have a stronger cash position in order to take advantage of when opportunities arise to acquire additional rigs.

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