In the last article, we took a look at which offshore drillers had the highest and lowest falls in their backlogs. In this article, we’ll look at offshore drillers’ backlogs in comparison to their revenues.
Why do we compare backlog to revenue? All offshore drilling companies are not same in size. Saying that some companies have their backlogs in the millions while others have their backlogs in the billions makes it hard to compare companies, so it’s better to compare backlog as a percentage of revenue.
To compare backlogs across companies, we’ve calculated the total backlog reported at the end of 3Q16 as a percentage of trailing-12-month revenue.
Transocean (RIG) has a few contracts that extend well beyond 2025. As we can see in the chart above, Transocean has the highest backlog-to-trailing-12-month revenue of 299%. Noble Corporation (NE) has the second-highest ratio among its peers. At the end of 3Q16, Noble Corporation’s backlog-to-trailing-12-month revenue stood at 242%. NE’s contracts extend up to 2023. The company’s backlog is divided into 63% drillship backlog and 37% jack-up backlog.
In the last article, we learned that Rowan Companies’ (RDC) backlog had fallen the most among its peers. With its backlog-to-trailing-12-month revenue ratio of 55%, Rowan Companies once again has the lowest ratio among its peers. The company doesn’t have any contracted backlog beyond 2019. Seadrill Partners (SDLP) has the second-lowest backlog-to-revenue ratio at 146%.