Paragon Offshore sees $5.2 million net loss for quarter ended March 31

By Caroline Salls

Pittsburgh, May 9 – Paragon Offshore plc reported a first-quarter net loss of $5.2 million, or a loss of $0.06 per diluted share, declining from a net income of $61.1 million for the first quarter of 2015, or $0.69 per diluted share, according to a news release.

The company said results for the first quarter of 2015 included a $16.8 million gain on the sale of an asset, a $4.3 million gain related to the repurchase of $11 million of its senior unsecured notes and a $2 million tax provision related to the gains.

Adjusted EBITDA for the first quarter was $115.4 million, up from $97.6 million in the fourth quarter of 2015, the release said.

“Paragon delivered better than anticipated operating results during the quarter even as we continued to engage in a process to restructure our balance sheet and eliminate a significant amount of debt,” president and chief executive officer Randall D. Stilley said in the release.

“Contract drilling costs were approximately 28% lower versus the fourth quarter 2015, while contract drilling revenues were down only 12%, highlighting our ongoing ability to execute in a difficult environment.”

Total first-quarter revenues were $265.1 million compared to $299.6 million in the fourth quarter of 2015 and $430.65 million for the quarter ended March 31, 2015.

The company had $835.4 million in cash and cash equivalents as of March 31, up from $773.57 million at Dec. 31.

As previously reported, the disclosure statement for Paragon’s Chapter 11 plan was approved by the U.S. Bankruptcy Court for the District of Delaware on April 6. The plan confirmation hearing is scheduled for June 21.

“Although oil prices have rebounded off their lows for the year, we do not anticipate a resumption in offshore drilling activity in the near-term,” Stilley said in the release.

“Paragon's focus is on emerging from our Chapter 11 process mid-summer as a stronger, more competitive company that is well-positioned for the future. We intend to continue to manage our costs and maintain adequate liquidity while we aggressively pursue any new contracts that are available.”

Paragon, a Houston-based provider of offshore drilling rigs, filed for bankruptcy on Feb. 14. The Chapter 11 case number is 16-10386.

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