Transocean Ltd. (NYSE: RIG) released its first-quarter earnings after the markets closed Wednesday. The company had $1.10 in adjusted diluted earnings per share (EPS) on $2.04 billion in revenue, versus Thomson Reuters consensus estimates of $0.60 in EPS on $1.91 billion in revenue. The first quarter from last year had $1.43 in EPS on $2.34 billion in revenue.

The company did not give guidance but there are consensus estimates of $0.25 in EPS and $1.70 billion in revenue for the second quarter. For the full year, the consensus estimates are $1.44 in EPS on revenue of $6.86 billion.

In this quarter, cash flows from operating activities were $526 million, down sequentially from $566 million.

Fleet revenue efficiency was 95.9%, compared to 95.3% in the fourth quarter of 2014. Revenue efficiency on ultra-deepwater rigs was 97.2%, an increase from 95.4% in the previous quarter. Fleet utilization was 79%, an increase from 73% in the fourth quarter of last year.

Transocean’s contract backlog was $19.9 billion as of the April 16.

Capital expenditures fell $117 million sequentially to $201 million. This was attributed to lower project costs on the existing fleet.

Operating and maintenance expenses decreased $226 million sequentially to $1.084 billion. The decrease was mainly associated with the company’s onshore and offshore cost reduction initiatives, including the optimization of maintenance and out-of-service costs, asset disposals and stacking of rigs.

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In the weeks ahead of earnings a couple of analysts weighed in on Transocean:

• Deutsche Bank has a Sell rating for Transocean.
• Morgan Stanley downgraded Transocean to an Underweight rating from Equal Weight.
• Edward Jones downgraded the company from a Hold rating to Sell.

Transocean shares closed Wednesday relatively flat at $18.99. In after-hours trading when the earnings were released, shares were initially up 1.6% at $19.30. The stock has a consensus analyst price target of $12.98 and a 52-week trading range of $13.28 to $46.12.

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