TRMA - Trico Marine Services - beat analysts' estimates by 67.61 percent

Trico Marine Services is finding that servicing the oil and gas sector during record high crude prices translates into higher profits. The company easily beat fourth quarter estimates by 67.61 percent and is seeing record day rates for some of its vessels.

Full Analysis

Trico Marine Services, Inc. (TRMA), headquartered in Houston, Texas, operates a diverse fleet of vessels serving the oil and gas industry, primarily in the North Sea, Gulf of Mexico, West Africa and Latin America.

The company, a Zacks #1 Rank (Strong Buy), has a fleet which includes multi-purpose anchor handling, towing and supply vessels (AHTS), large platform supply vessels, an advanced small-waterplane-area twin-hull (SWATH) crew vessel, crew boats and line handling vessels.

The company's services include the transportation of drilling materials, supplies and crews, and support for the construction, installation, maintenance and removal of offshore facilities.

On Feb 18, Trico reported fourth quarter earnings and beat analysts' estimates by 48 cents, or 67.61 percent. Net income was $30.7 million, or $2.08 per share. Due to changes to the Norwegian Tonnage Tax rules that took place in December 2007, the tax changes increased net income for the quarter by 89 cents per share. Excluding the tax increase, the company reported $1.19 compared to analysts' consensus estimates of 71 cents per share.

In the fourth quarter, the North Sea market hit record day rates in the spot anchor handler market, with average day rates for the North Sea class fleet improving by 15 percent over the third quarter.

The market in West Africa is also heating up. For the first time in the company's history, the average day rate for vessels in West Africa exceeded the day rates for those in the Gulf of Mexico for the 180-foot supply vessels.

"We are pleased with our fourth quarter and full year 2007 results. While we experienced softness in our Gulf of Mexico market, we continued to successfully execute our plan to mobilize vessels internationally for longer term contracts and better day rates," said Chairman and Chief Executive Officer, Joseph S. Compofelice.

"During the fourth quarter, we mobilized six vessels internationally which brought the total to thirteen vessels for the year, or 20% of our fleet," he said.

Brokerage analysts mirror the company's optimism about 2008. One out of two covering analysts raised estimates for the full year in the last week by 22 cents to an average of $3.27 from $3.05 per share.

Trico hit the ball out of the park the last four quarters, surprising on consensus estimates by an average of 27.48 percent. The company has solid value fundamentals. It has a P/E of only 11.64, which is under the industry average of 20.7. It has a P/B of 1.51.

Content Courtesy: Zacks Investment Research

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