COVINGTON, La. (AP) — Shares of Hornbeck Offshore Services Inc., which makes ships used to transport oil and gas, sank more than 14 percent Thursday after it reported second-quarter financial results that fell short of Wall Street's expectations.
The Covington, La., company makes most of its money in the Gulf of Mexico, where drilling has scaled back dramatically in the two years following the worst oil spill in U.S. history.
Tougher drilling rules passed after the spill required oil companies to prove they can control a blowout similar to the April 2010 fire and rig sinking that sparked it. After the spill, several large oil companies set up the Marine Well Containment Company to prove the industry could control a deep-sea oil spill. It was a condition the industry had to meet before regulators would begin re-issuing deep-water drilling permits. Regulators began issuing permits in early 2011.
But even now, demand is going in waves and spurts, Hornbeck said. Regulatory scrutiny has remained high, although drilling has largely resumed. That's drawn some companies away and hit those that remain, like Hornbeck.
The company reported net income of $12 million, or 33 cents per share, compared with a year-ago loss of $7 million, or 26 cents per share. Excluding a charge to pay off debt early, the company reported net income of 35 cents per share in the most recent quarter.
Revenue jumped 63 percent to $131.6 million
Analysts expected higher earnings of 43 cents per share on revenue of $133.2 million.
Hornbeck shares dropped $5.85, or 14.1 percent, to $35.79 in trading Thursday. The stock earlier fell as low as $34.01. It has traded between $19.80 and $43.83 in the past year.