The company's revenue in 1Q20 was down 19% at US$321 million with lower proportion of reimbursable revenues. Operating loss was US$1.2 billion after making material asset impairments. Adjusted EBITDA was US$55 million, representing a 17.1% margin.
The net loss attributable to the shareholder was US$1.57 billion, equivalent to a net loss per share of US$15.59.
During the quarter the company added US$77 million in backlog, maintaining a total backlog figure of US$2.5 billion. At the end of the quarter closing cash was recorded at US$1.2 billion.
The company cited the market challenges of the oil price drop and the logistical challenges arising from the Covid-19 pandemic as reasons for the results, and has announced its intention to delist from the New York Stock Exchange and maintain a single listing on the Oslo Stock Exchange.
Anton Dibowitz, President and CEO, commented: "This industry has two fundamental challenges which are emphasised by recent events - there are too many rigs carrying too much debt. In the quarter we took an impairment of US$1.2 billion as we recognise, along with others in the sector, that a number of our assets are increasingly unlikely to return to the market and need to be scrapped. Assets across the industry also carry debt levels which are unlikely to be sustainable and consequently we should expect to see substantial indebtedness being converted to equity. Only when the industry addresses both of these issues will we be in a position where the balance of market supply and demand can deliver reasonable investment returns to stakeholders."
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/02062020/seadrill-reports-us12-billion-impairment-in-1q20/