McDermott Int'l Shares Plunge 9% As Q3 Results Miss Estimates

(RTTNews) - Shares of McDermott International, Inc. (MDR) plunged nearly nine percent in extended trade on Monday after the engineering and construction company reported a loss for the third quarter that came in significantly wider than analysts' expectations. Quarterly revenues declined and missed Street estimates.

"I am pleased to see our Middle East segment return to profitability this quarter as we demonstrated improved consistency in performance. Despite our recent challenges, I am optimistic about the future of the Company and the foundation that we have built to address the subsea market," Chairman, President and CEO Stephen Johnson said in a statement.

The Houston, Texas-based company reported a net loss of $64.07 million or $0.27 per share for the third quarter, compared to net income of $50.61 million or $0.21 per share in the prior-year quarter.

On average, 18 analysts polled by Thomson Reuters expected the company to report a loss of $0.03 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenue for the quarter decreased to $686.86 million from $1.03 billion in the same quarter last year, and missed fourteen Wall Street analysts' consensus estimate of $743.13 million.

The revenue drop was attributable primarily to the completion of several significant projects that were active in the 2012 third quarter.

The company noted that all projects in the Middle East segment contributed to gross profit and were in a profitable position in the third quarter.

Meanwhile, a deepwater Malaysian project in the Asia Pacific segment experienced vessel mechanical downtime that contributed to $66.0 million of additional project costs.

The company reported a backlog of $4.61 billion as at the end of the third quarter, lower than $5.34 billion at the end of the year-ago quarter.

The results for the latest quarter include about $4.0 million of restructuring costs. The company expects to incur the majority of the remaining $35.5 to $45.5 million in planned restructuring and management charges in the next two quarters.

At the end of the third quarter, the company had $9.0 billion in bids outstanding and is targeting about $8.9 billion in projects that it expects to bid within the next five quarters.

MDR closed Monday's regular trading session at $7.42, up $0.34 or 4.80% on a volume of 9.78 million shares. However, the stock plunged $0.64 or 8.63% in after-hours trading.