DryShips Inc., a Greek owner of deep-water drilling rigs and vessels that haul iron ore and coal, advanced after the company reported third-quarter adjusted earnings that beat analyst estimates.
DryShips rose 7.7 percent after the company said yesterday that net income excluding some items reached $99 million, or 38 cents a share. The estimate of 11 analysts surveyed by Bloomberg was 25 cents.
“They beat estimates on better-than-expected drilling revenues, and that’s really what’s driving the stock,” said Michael Webber, senior analyst at Wells Fargo Securities LLC in New York. “They are also relatively optimistic on the drilling market and their prospect for charters.”
Including losses from interest rate swaps and other items, net income was $49.3 million, or 18 cents a share, the Athens- based company said. Revenue rose 1.5 percent to $225.5 million from $222.3 million.
DryShips gained 40 cents today to settle at $5.59 in Nasdaq Stock Market composite trading after rising as much as 12 percent in intraday trading.
About 82 percent of the company’s drybulk fleet has been contracted under long-term time charters for 2011 at a daily rate of $37,000, the company said in a conference call today. 2011 revenue from fixed charters is estimated at $411 million.
Revenue from shipping fell to $115.1 million in the third quarter from $120.6 million a year earlier. Revenue from drilling contracts advanced to $110.4 million from $101.7 million.
The company currently operates two drilling rigs and has four under construction that are to be delivered next year.
DryShips said Oct. 15 that it had signed a contract worth $160 million with subsidiaries of Vanco Overseas Energy Ltd., a Houston-based drilling company, for one of its new rigs. The one-year contract for drilling off the coast of Ghana and Cote d’Ivoire will start in the second quarter of 2011.