Ensco plc (NYSE: ESV) announced the appointment of Carl Trowell as the Chief Executive Officer (NYSE: CEO), President as well as to the board of directors. The effective date of appointment as the CEO and President and the board is Jun 15, 2014. Trowell will replace Dan Rabun after the termination of his eight-year tenure as the CEO. Rabun's planned retirement was announced in Nov 2013. However, following Trowell's appointment, Rabun will continue to serve as Non-Executive Chairman.
Trowell, a PhD in Earth Sciences, from the University of Cambridge began his professional career as a petroleum engineer in Royal Dutch Shell plc (RDS.A). Subsequently, he joined Schlumberger Limited (NYSE: SLB) where he served as President – Integrated Project Management, President – Schlumberger Production Management and President – Schlumberger WesternGeco Ltd., over the years.
U.K.-based Ensco is a leading supplier of offshore contract drilling services to the oil and gas industry. The company remains well positioned to reap benefits from the recent strength in the offshore markets, thanks to its high quality fleet, manageable newbuild program and impressive execution.
Ensco's exposure to the fastest growing markets of the world, including Southeast Asia and West Africa, is an added incentive. We also appreciate the company's financial discipline and organically developed asset base, which are expected to drive earnings over the long term.
Ensco will continue to see tighter jackup markets around the world throughout 2014. The rig market is witnessing a series of attractive awards and has possibly a stronger outlook than even the floater market. Almost every region is anticipated to have weak rig availability next year. Ensco has $11 billion of contracted revenue backlog (excluding bonus opportunities), providing it with an excellent cash flow visibility.
On the flip side, the company is expected to have increased downtime in 2014, mainly on account of the jackup fleet with 95 days, while floaters are estimated to have a downtime of 31 days. This would affect its revenues. Further, the challenges arising in contracting rigs for extensions in Brazil are also major concerns.
Ensco currently has a Zacks Rank #3 (Hold). Meanwhile, investors may consider a better-ranked player in the same industry like Athlon Energy Inc. (NYSE: ATHL) which sports a Zacks Rank #1 (Strong Buy).
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