Rowan Companies Inc. is a major provider of international and domestic offshore contract drilling services. The Company also owns and operates a manufacturing division that produces equipment for the drilling mining and timber industries. Rowan Companies Inc. has a market cap of $2.06 billion; its shares were traded at around $18.19 with a P/E ratio of 4.2 and P/S ratio of 0.9. Rowan Companies Inc. had an annual average earning growth of 10.9% over the past 10 years. Highlight of Business Operations:As indicated in the preceding table, our consolidated operating income increased by $50.5 million or 34%, when comparing the first quarters of 2009 and 2008, on a $9.3 million or 2% increase in revenues and a $41.2 million or 12% reduction in costs. See further discussion under segments below.
Net income includes income tax expenses of $67.9 million (34%) and $51.8 million (35%) for the first quarters of 2009 and 2008, respectively.
Our drilling operations generated a $40.0 million or 12% increase in revenues between periods. Our average offshore day rate was $173,600 during the first quarter of 2009, compared to $159,700 in the first quarter of 2008. Our offshore fleet was 93% utilized during the first quarter of 2009, compared to 91% in the first quarter of 2008, with much of the downtime in each period associated with rigs that were being prepared for long-term assignments. We realized 96 or 6% more revenue-producing days between periods primarily due to the addition of newbuild jack-ups Rowan-Mississippi and J.P. Bussell in November 2008, and foreign operations contributed 53% of the total revenues during the first quarter of 2009, down from 61% in the first quarter of 2008.
Drilling expenses during the first quarter of 2009 decreased by $11.1 million, or 7%, from the first quarter of 2008 due primarily to lower labor and related fringe benefit costs, repair and maintenance and insurance costs. Drilling depreciation expense increased by $7.6 million or 26% between periods due primarily to the rig additions discussed above. Selling, general and administrative expenses incurred by our Drilling segment decreased by $0.7 million or 4% between periods due primarily to lower incentive-based compensation expense.
Our Drilling operations included a $4.7 million net gain on property and equipment disposals during the first quarter of 2009, compared to $5.4 million during the first quarter of 2008. Both amounts relate primarily to the sale of non-core facilities.
Our Drilling Products and Systems operating results for the 2009 first quarter excludes $73 million of revenues and $53 million of expenses in connection with sales of products and services to our Drilling segment, most of which was attributable to construction of the newbuild jack-up, Ralph Coffman. Drilling Products and Systems operating results for the comparable quarter of 2008 excludes $79 million of revenues and $66 million of expenses, primarily for construction of the J.P. Bussell, Rowan-Mississippi and Ralph Coffman.
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