UPDATE 1-Seadrill hit by $810 mln in Q4 charges

Mon Feb 23, 2009 3:56am EST
 
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* Value of oil service shareholdings falls

* Says investments still attractive in long term

(Adds details, quotes)

OSLO, Feb 23 (Reuters) - Oslo-listed offshore services group Seadrill Ltd (SDRL.OL) announced $810 million in one-off charges and losses in the fourth quarter as the value of its equity investments in the oil services sector fell, sending its shares lower.

Seadrill booked a $615 million charge as the market value of its stakes in Pride International (PDE.N), Scorpion Offshore (SCORE.OL) and SapuraCrest Bhd (SCRS.KL) dropped last year.

Shares in Seadrill were down 1.6 percent to 55.70 crowns at 0836 GMT, on a rising Oslo bourse .OSEBX.

"Seadrill continues to see ... Pride, Scorpion and SapuraCrest as attractive long-term investments," Chief Executive Alf Thorkildsen said in a statement.

"All three companies trade today at a large discount to the real value of the underlying assets...(and) have strong cashflows and good compositions of assets, which match Seadrill's strategic growth ambitions."

The company said it was "hopeful" that through long-term holding it would recover the losses and "over time also make these investments into profitable growth for Seadrill."

Seadrill is due to report fourth quarter results on Feb. 26.

According to last week's Reuters poll of 13 analysts, Seadrill was expected to post a 67 percent rise in operating profit to $184 in the fourth quarter. Net profit was seen down 70 percent to $67 million. [ID:nnLJ819109]

Seadrill also said it would book a $35 million loss related to swap agreements on its treasury shares and $160 million in charges on interest rate swap transactions.

"The loss related to the interest rate swaps reflects lower long-term interest rates, which is fundamentally positive for the company," Seadrill said.

At the end of last year, Seadrill had $7.1 billion in interest-bearing debt, approximately 55 percent of which carried fixed long-term interest rates.

(Reporting by Wojciech Moskwa; editing by John Stonestreet)