"TESO" on NASDAQ

HOUSTON, TX, May 5 /CNW/ - Tesco Corporation ("TESCO" or the "Company") today reported net income for the quarter ended March 31, 2009 of $4.4 million, or $0.12 per diluted share. This compares to net income of $12.0 million, or $0.31 per diluted share, for the fourth quarter of 2008, and net income of $10.7 million, or $0.29 per diluted share, for the first quarter of 2008. Operating income for the current quarter was negatively impacted by $1.6 million in severance and relocation fees, $2.2 million for the settlement of an outstanding lawsuit and $1.0 million for legal and other fees related to ongoing contingencies. We also recorded a one-time tax benefit of $1.6 million resulting from a change in the Canadian tax law. Without these items, net income would have been $6.7 million, or $0.17 per share.

Revenue was $110.2 million for the quarter ended March 31, 2009, compared to revenue of $139.4 million for the fourth quarter of 2008 and $129.4 million for the first quarter of 2008.

Summary of Results

(in millions of U.S. $, except per share amounts)

U.S. GAAP-Unaudited

Quarter 1 Quarter 4

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2009 2008 2008

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Revenues $ 110.2 $ 129.4 $ 139.4

Operating Income 4.0 16.4 16.9

Net Income 4.4 10.7 12.0

EPS (diluted) $ 0.12 $ 0.29 $ 0.31

Adjusted EBITDA(x) (as defined) $ 15.1 $ 24.2 $ 28.7

(x)See explanation of Non-GAAP measure below

Commentary

Julio Quintana, TESCO's Chief Executive Officer, commented "In light of the current economic environment, we are satisfied with our Q1 results. Revenue from our proprietary tubular business set another record last quarter and we reduced our net debt by $4.3 million. Our focus on CASING DRILLING(TM) costs is beginning to pay off. CASING DRILLING(TM) margins improved both sequentially and year over year. However, we had decreased revenues in all three of our operating segments. Drilling activity, particularly in North America, declined at a pronounced rate. We are taking strong action to control our costs and have reduced our global headcount by approximately 15% during the quarter, with almost all reductions occurring in North America. We will continue to aggressively manage all of our costs. Longer term, we believe the fundamentals driving the growth of our global business remain intact. This should give us the ability to maintain our core strengths and weather the current downturn while sustaining free cash flow."

Segment Information

(in millions of U.S. $)

Unaudited

Quarter 1 Quarter 4

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2009 2008 2008

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Revenues:

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Top Drives:

Sales $ 28.7 $ 38.5 $ 43.1

Aftermarket Support 15.8 15.0 17.1

Rental 23.6 27.7 29.8

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68.1 81.2 90.0

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Tubular Services(x):

Conventional 9.6 23.6 16.8

Proprietary 27.4 18.2 26.2

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37.0 41.8 43.0

CASING DRILLING(TM)(x) 5.1 6.4 6.4

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Total Revenues $ 110.2 $ 129.4 $ 139.4

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Operating Income:

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Top Drives $ 16.0 $ 23.8 $ 26.1

Tubular Services 2.7 6.0 5.0

CASING DRILLING(TM) (1.4) (2.6) (3.4)

Research and Engineering (2.6) (2.8) (2.9)

Corporate/Other (10.7) (8.0) (7.9)

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Total Operating Income $ 4.0 $ 16.4 $ 16.9

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(x) Effective December 31, 2008, we began reporting our CASING

DRILLING(TM) operations as a distinct operating segment separate from

our Tubular Services business and we have recast prior periods to be

presented consistently with this structure.

Q1 2009 Financial and Operating Highlights

Top Drives Segment

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- Revenues from the Top Drive segment for Q1 2009 were $68.1 million,

down 24% from revenues of $90.0 million in Q4 2008, primarily due to

a decrease in Top Drive sales. Top Drive sales for Q1 2009 included

32 units (31 new units sold and 1 from the rental fleet). This

compares to record number of 38 units (37 new units sold and 1 from

the rental fleet) sold in Q4 2008 and 31 units sold in Q1 2008 (25

new and 6 from the rental fleet).

- At March 31, 2009, Top Drive backlog was 35 units, with a total value

of $34 million, versus 65 units at December 31, 2008, with a total

value of $57 million. This compares to a backlog of 39 units at

March 31, 2008 with a total value of $41 million.

- Operating days for the Top Drive rental fleet decreased to 4,673 for

Q1 2009 compared to 5,808 in Q4 2008 and 5,689 in Q1 2008, primarily

due to a fall off of rental activity in North America directly

resulting from the decline in rig count.

- Our Top Drive operating margins were 23% in Q1 2009 compared to 29%

in Q4 2008 and 29% in Q1 2008. The margin decrease compared to Q4

2008 is due to the sale of smaller Top Drive units during the current

quarter, decreased rental activities, lower margins in our

aftermarket business and severance costs of $0.4 million.

Tubular Services Segment

------------------------

- Revenues from the Tubular Services segment for Q1 2009 were

$37.0 million, a decrease of $6.0 million from Q4 2008, primarily

related to a decline in our conventional revenues, but partially

offset by an increase in our proprietary revenues. Our conventional

business is primarily conducted in North America and is directly tied

to the rig count which has sharply declined over the past six months.

We performed a record total of 562 proprietary casing running jobs in

Q1 2009 compared to 540 in Q4 2008 and 460 in Q1 2008. We remain

focused on converting the market to running casing with our

proprietary CDS(TM) technology.

- Operating Income in our Tubular Services segment for Q1 2009 was

$2.7 million, compared to $5.0 million in Q4 2008 and $6.0 million in

Q1 2008. Q1 2009's operating income was unfavorably impacted by lower

activity and pricing pressure in North America and severance costs of

$0.2 million.

CASING DRILLING(TM) Segment

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- CASING DRILLING(TM) revenue in Q1 2009 was $5.1 million, compared to

$6.4 million in Q4 2008 and $6.4 million in Q1 2008. The decrease in

Q1 2009 compared to the Q4 and Q1 2008 was primarily due to lower

revenue in Latin America.