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Friday January 21, 9:43 am Eastern Time

Diamond Offshore earnings fall short of consensus

HOUSTON, Jan 21 (Reuters) - Diamond Offshore Drilling Inc. (NYSE:DO - news), the second biggest U.S. offshore oil drilling contractor, said on Friday its earnings fell sharply in the fourth quarter of 1999 from year-earlier levels.

Net income dropped to $13.2 million, or 10 cents per share on a diluted basis, from $82.6 million, or 58 cents per share. Revenues fell to $170.9 million from $283.4 million.

Reported net income included a non-cash after-tax charge of $6.9 million or five cents per share to reflect a fall in the value of investment securities held by the company.

Net income excluding this charge came to 15 cents a share, one cent below the First Call/Thomson Financial consensus estimate of 16 cents per share.

Diamond Offshore did not cite a reason for the lowered profit and revenues in its earnings statement. The company said it had sold its ``Ocean Scotian'' jack-up drilling rig for $32 million this month and that this would generate an after-tax gain of $9.3 million in the first quarter of 2000.

It said it had also been awarded a letter of intent under which its Ocean Alliance semisubmersible drilling rig will work for Brazilian state oil company Petrobras, generating revenues of at least $131 million over three years.

The Ocean Alliance is currently working offshore West Africa but is scheduled to begin mobilization for the Petrobras contract in Brazil in the third quarter of this year.

-- snooze button (alarmclock_2000@yahoo.com), January 21, 2000