Dolphin Drilling (Buy, TP: NOK20.00) - Focus on putting second rig to work
After the startup of Blackford behind the next leg of Dolphin Drilling’s plan should be putting one of its two stacked rigs (the Borgland or Bideford) back to work. We see most opportunities for these rigs outside the North Sea and assume startup for one rig in mid-2024e. Having secured a USD15m RCF from its two largest shareholders (SVP and Standard ETC), it should have sufficient funds to reactivate one rig, further supported by earnings from the Blackford. We reiterate our BUY and NOK20 target price, which implies a 2024e EV/EBITDA of 5.9x and a 2025e of 3.1x.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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