Seadrill Ltd (NYSE:SDRL), an offshore drilling contractor, stock fell 0.66% (As on May 15, 11:22:02 AM UTC-4, Source: Google Finance) after the company posted higher than expected results for the first quarter of FY 24. Contract revenues were $275 million, compared to $315 million the prior quarter, primarily related to fewer operating days for the Sevan Louisiana, West Polaris, and West Auriga, partially offset by improved economic utilization. After completing its drilling contract in December 2023, the Sevan Louisiana undertook a special periodic survey and related maintenance during the first quarter of 2024. The West Polaris and West Auriga finished their contracts in January and February, respectively; were reintegrated into the Company’s rig fleet following the termination of third-party management agreements; and began preparing for contracts in Brazil, scheduled to begin in the fourth quarter of this year. Adjusted EBITDA was $124 million for the first quarter of 2024, an increase of $24 million from the prior quarter. Adjusted EBITDA Margin was 33.8%. As of May 14, 2024, Seadrill’s Order Backlog stood at approximately $2.8 billion, including approximately $108 million in contract additions since February 28, 2024.

SDRL in the first quarter of FY 24 has reported the adjusted earnings per share of 81 cents, beating the analysts’ estimates for the adjusted earnings per share of 68 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue of $367 million in the first quarter of FY 24, beating the analysts’ estimates for revenue by 0.14%.

Additionally, Cash flow from operations during the first quarter of 2024 was $29 million, after deducting $29 million of long-term maintenance capital expenditures, compared to $140 million in the prior quarter. Capital upgrades captured in investing cash flows were $23 million. Resulting Free Cash Flow was $6 million. In the first quarter of 2024, Seadrill made $119 million of share repurchases. As of May 10, 2024, the Company has returned a total of $442 million to shareholders and has $58 million remaining under its current repurchase authorization. As of March 31, 2024, Seadrill had gross principal debt of $625 million; $612 million in cash and cash equivalents, including $28 million in restricted cash; and an additional $225 million in available borrowings under its undrawn senior secured revolving credit facility.

For the full year 2024, Seadrill reaffirmed its guidance, projecting revenues between $1.47 billion and $1.52 billion. This forecast is slightly above the analyst consensus of $1.48 billion, contributing to the positive market sentiment.