Margins, Capital Efficiency Will Improve: With the sale of its low specification shallow water rigs, Transocean has been downsizing its shore-based support infrastructure to account for the smaller overall rig count. The cost reductions will entail streamlining and consolidating some business functions as well as eliminating some of the company's non-core operations. The company anticipates that these initiatives could help to achieve annualized savings of around $300 million beginning in FY2014. The deepwater focus will also have a very positive impact on Transocean's capital efficiency. Transocean's ultra-deepwater rigs have average day rates of above $500,000, which is significantly higher than the rest of the company's fleet. Additionally, the ultra-deepwater rigs are also among the company's most productive assets since they have a revenue efficiency of around 92% with utilization rates of around 96%. Utilization rates are a ratio of the number of rigs working on contract to the total number of rigs.