Seadrill’s contract backlog reached approximately $2.9 billion as of August 10 as strengthening offshore drilling demand lifted average contractual dayrates and generated additional long-term contract coverage for its high-specification fleet.
Average contractual dayrates increased to approximately $360,000 during Q2 from $343,000 in the first quarter. Economic utilization also improved to 95.5% from 94.6%, while the average number of rigs on contract increased to 10 from nine.
One of the largest recent awards came from the U.S. Gulf, where West Vela secured a one-year contract beginning in June 2027. The agreement adds approximately $161 million to backlog before additional services.
West Capella also secured an approximately 75-day extension in Malaysia that adds about $26 million to backlog and commits the rig through August 2027. Sevan Louisiana added roughly 45 days of work in direct continuation of its existing U.S. Gulf program.
The greater contract activity translated into substantially stronger quarterly results. Revenue increased to $449 million from $358 million sequentially, driven primarily by more operating days for West Jupiter and West Capella and higher average fleet dayrates.
Adjusted EBITDA increased to $144 million from $97 million, while Adjusted EBITDA margin increased to 32.1% from 27.1%. Excluding reimbursable revenue, margin reached 33.5%. Net income improved to $29 million from a $7 million loss in the first quarter.
Seadrill ended Q2 with $750 million of gross principal debt and $360 million of cash, cash equivalents and restricted cash, resulting in net debt of $390 million. The company also increased its full-year revenue and EBITDA guidance following the stronger operating performance and contract coverage.
KEY QUOTES:
“Seadrill’s second quarter performance reflects strong operational, commercial and financial execution, with momentum building across the business. We achieved 96% Economic utilization, meaningfully enhanced our contract coverage in the U.S. Gulf and increased our full-year revenue and EBITDA guidance.”
“Demand for our high specification fleet continues to strengthen and contract coverage is improving as we enter a period where our strategic decisions are enabling us to capture the upside in the market.”
Samir Ali, President And Chief Executive Officer Of Seadrill
