Odfjell Drilling (ODL) Q4 2024 earnings summary

Executive summary

• Achieved record Q4 2024 revenue of $204 million and EBITDA of $93 million, driven by higher day rates, strong operational performance, and high financial utilization despite challenging weather.

• Dividend per share more than doubled to $0.125 (12.5 cents), totaling $30 million for Q4, reflecting strong cash flow and increased distribution capacity.

• Own fleet fully booked until 2027, with a firm order backlog of $1.9 billion plus $100 million in priced options, including a significant extension with Equinor at a day rate of $500,000.

• Financial position remains robust with leverage ratio at 1.6x, equity ratio at 63%, and available liquidity of $217 million.

• Debt instalments on Deepsea Nordkapp facility reduced, deferring $34.2 million to 2029, enhancing financial flexibility.

Financial highlights

• Q4 2024 revenue was $204 million (up from $192 million in Q4 2023); full-year revenue reached $775 million and EBITDA $345 million (up from $329 million).

• Q4 2024 EBITDA reached $93 million (up from $83 million); Q4 net profit was $15 million (down from $24 million); full-year net profit was $65 million.

• Q4 2024 EBITDA margin was 45%; own fleet Q4 EBITDA margin was 55%.

• Net debt reduced to $504 million; available liquidity at $217 million, including $99 million undrawn RCF.

• Q4 cash from operations was $108 million; CAPEX for the quarter was $43 million.

Outlook and guidance

• Own fleet fully contracted until 2027, with Deepsea Stavanger secured until early Q2 2030.

• All rigs moving to higher day rates in 2025, with SPS programs set to finish by Q2 2025, reducing capex in the second half.

• Management expects further dividend increases, with capacity and ambition to declare a higher dividend at Q1 2025 results.

• Market outlook in Norway remains balanced and robust, with strong client interest and increased exploration and field development activity.

• International demand stable, with new opportunities in West Africa, Namibia, Suriname, and Falkland Islands.