Borr Drilling Ltd.’s (BORR) stock price was up by 1.13% as of the market closing on August 30th, 2021. This brought the price per share up to USD$0.71 at the end of the trading day. Subsequent premarket fluctuations saw the stock surge by 9.75%, bringing it up to USD$0.78.
BORR Stock Reports Strong Q2 2021
The second quarter of fiscal 2021 saw steady improvements in BORR stock’s operations. The end of the quarter marked 13 working rigs in operation. The 2021 fiscal year has seen the company reporting having received significant contracts, which have resulted in the addition of roughly USD$542 million in revenues to their backlog. The company’s fleet holds an addition ten rigs that have been delivered and can be deployed in an improving market. The fleet will also be consolidated by an additional five rigs that are yet to be delivered by the Keppel FELS shipyard.
Expansion of BORR Stock’s Fleet
The upcoming few weeks are expected to see ongoing negotiations for the operation of 17 rigs. These rigs are expected to start generating revenue by the end of the fiscal year 2021. In the current global market of elevated oil prices, rig demand is returning to pre-pandemic levels, going so far as to exceed previous highs. The global fossil fuel environment also sees the natural reduction of rig supply, which BORR stock poised to capitalize on the opportunities this presents to it. The company is keen to commence operations across all 23 of its delivered rigs by the end of 2022.
Facilitating Further Expansion
The current quarter is expected to generate positive cash from operations after the company pays off cash interest cost at the current level of 13 rigs operating at contracted rates for a full quarter. BORR stock also reported improved collections from its Mexican joint ventures, as well as the sale of its stake in IWS JVs. Resultingly, the company generated USD$42.4 million from its Mexico operations since the start of the fiscal year. With the added capital, BORR stock managed to release working capital, while concurrently securing additional work for its five rigs in the U.S until the end of 2022.
Future Outlook for BORR Stock
The company reported a promising quarter, consolidated by the strength of its financial reports for Q2 2021. BORR stock is poised to capitalize on the momentum it has generated, in tandem with favorable market conditions. Current and potential investors are hopeful for significant and sustained increases in shareholder value.
