SDLP - Seadrill Partners LLC Announces Plan to Reduce Quarterly Cash Distributions
London, United Kingdom, December 18, 2015 - Seadrill Partners LLC (NYSE: SDLP) ("Seadrill Partners" or the "Company") announced today that following the completion of its annual budgeting and forecast cycle it has approved a plan to reduce the quarterly distribution to $0.25 per unit to its common unitholders, down from the current quarterly level of $0.5675. The revised distribution level will take effect in February 2016 upon payment of the fourth quarter 2015 distribution.
The decision to reduce the distribution reflects the continuing challenges in the offshore drilling market. The revised distribution level will provide significant flexibility to manage our medium term obligations and reduce leverage.
This move is expected increase liquidity by over $250 million per year, including the reduction in distributions to non-controlling interests, and the Company expects to continue to set aside cash reserves for maintenance and replacement capex of approximately $200 million per year.
The Company's underlying business remains strong with long term contracts, efficient operations and creditworthy customers. While the market remains challenging, the Company believes its modern fleet is well positioned for a recovery and we continue to seek new contracting opportunities.
FORWARD LOOKING STATEMENTS
This news release includes forward looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. In particular, statements regarding projected changes in the Company's cash distributions, liquidity, amount of the Company's estimated maintenance and replacement capital expenditures, the Company's anticipated growth strategies and its ability to re-contract its drilling rigs are considered forward looking statements. These statements are made based upon management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward looking statements, which speak only as of the date of this news release. Important factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to the performance of the drilling rigs in the Company's fleet; delay in payment or disputes with customers; fluctuations in the international price of oil; changes in governmental regulations that affect the Company or the operations of the Company's fleet; increased competition in the offshore drilling industry; hire rates and factors affecting supply and demand for drilling rigs; the financial condition of the Company's existing or future customers; and general economic, political and business conditions globally. Consequently, no forward looking statement can be guaranteed. When considering these forward looking statements, you should keep in mind the risks described from time to time in the Company's filings with the SEC, including its Annual Report on Form 20-F (File No. 001-35704).
The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, the Company cannot assess the impact of each such factor on its business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward looking statement.
This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Seadrill Partners LLC via Globenewswire
Source: Thomson Reuters ONE
(December 18, 2015 - 1:30 AM EST)
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