Investing.com -- Shares of Valaris Limited (NYSE: VAL) climbed 4% following the offshore drilling company's fourth-quarter earnings report, which surpassed Wall Street's expectations. The company reported earnings per share (EPS) of $1.88, significantly higher than the analyst consensus of $1.11. Revenue for the quarter was also above estimates, coming in at $584.4 million compared to the expected $578.76 million.

Valaris attributed its strong performance to high fleetwide revenue efficiency and exceptional safety achievements, as highlighted by President and CEO Anton Dibowitz. The company's focus on high-specification assets and prudent fleet management were also emphasized as factors contributing to its positive results. Additionally, Valaris announced a multi-year contract for the jackup VALARIS Stavanger in the North Sea and the planned retirement and sale of several rigs, which aligns with its strategy to concentrate on high-specification assets.

The fourth-quarter financials reflected an increase in net income to $131 million from $63 million in the previous quarter, although Adjusted EBITDA saw a slight decrease to $142 million from $150 million, primarily due to lower utilization for the floater fleet. Despite this, the jackup fleet experienced more operating days, which partially offset the impact. Valaris also generated $125 million in cash from operating activities and reported free cash flow of $13 million. The company actively returned value to shareholders, repurchasing $25 million of shares during the quarter.

On the operational front, Valaris delivered revenue efficiency of 96% for the quarter and 97% for the full year, showcasing the company's operational excellence. The firm was also recognized with safety awards by the International Association of Drilling Contractors (IADC) and the Center for Offshore Safety, underscoring its commitment to maintaining high safety standards.

Looking ahead, Valaris expressed confidence in the contracting outlook for 2026 and beyond, particularly for high-specification assets. Dibowitz concluded by reaffirming the company's belief in the essential role of offshore oil and gas in providing secure and affordable energy, positioning Valaris to drive sustainable value creation for shareholders.

The stock's positive movement reflects the market's favorable response to Valaris' earnings beat and strategic maneuvers, signaling investor confidence in the company's direction and operational capabilities.

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