 | www.華仕伯.com | 新聞稿 | ||||||||||||||||||
華仕伯公佈2024年第三季度業績
百慕大，2024年10月30日… 華仕伯有限公司（紐交所：VAL）（「華仕伯」或「公司」）今天公布了2024年第三季度業績。
院長兼首席執行官安東·迪博維茨表示：“我們在第三季度取得了強勁的運營表現和財務業績，包括穩健的自由現金流產生。我們全船隊的營業收入效率達到了98%，其中包括 VALARIS DS-7 在第二季度合同啟動後整個季度的運營。基於我們在安全、可靠和高效運營上的不懈努力，我們自豪地宣布，連續第二年被海洋安全中心授予安全領導獎，以表彰我們開發的 Restricted Zone Analysis 工具。”
Dibowitz表示：「我們堅信這一輪高潮的強度和持久性，並認為華仕伯已經處於有利位置，可推動長期價值創造。雖然我們看到一些客戶需求被推遲，但2026年及以後的展望仍然強勁。我們繼續專注於確保我們可用鑽井艦隊獲得具吸引力的長期工作，以支持我們的盈利和現金流成長。」
Dibowitz得出結論說，“如預期般，我們的自由現金流狀況相對於上半年有所改善，並在第三季度回購了10000萬美元的股票。我們堅持將來所有的自由現金流返還給股東，除非有更好或更具增值的用途。”
財務與營運亮點
•凈利潤為6300萬美元，調整後的EBITDA為15000萬美元；
•營業收入效率達到98%;
•從營運活動中產生了19300萬的現金，以及自由現金流11100萬;
•回購了10000萬美元的股份；
•憑藉其2024年安全領導獎，該公司因發展受限區域分析工具而獲得海上安全中心的認可；
•華仕伯DS-7 鑽井船在第二季重新啟動並開始合約運營後，進行了一整個季度的運作。
•十月份授予VALARIS 118高規格升降式鑽井平台三年合同延長，增加$16800萬的合同待處理額。
第三季度檢討
凈利潤從2024年第二季的$15100萬降至$6300萬。凈利潤中包括$2400萬的稅費，相比之下，第二季的稅收補助為$3000萬。調整後的EBITDA由第二季的$13900萬增加至$15000萬，主要是由於VALARIS DS-7在合同開始後全季度營運和浮動艦隊的日均營業收入增加。這些因素部分被VALARIS DPS-5和DS-10的低利用率以及VALARIS 249因腿部維修而停用和維修成本部分抵消。
營業收入從2024年第二季的6億4300萬美元增加到6億1000萬美元。不計可退還項目，營業收入從第二季的5億7300萬美元增加到5億9800萬美元，主要是由於操作日數增加以及與華仕伯247號油井業務相關的分期攤銷的運輸收入增加，華仕伯DS-7號油井運營了一個完整的季度，以及浮動平臺艦隊的平均日收入增加。這些項目部分被華仕伯DPS-5號和DS-10號的利用率降低以及華仕伯249號油井停機時間抵銷。
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承包鑽探支出從2024年第二季的43900萬增加到46200萬美元。除可退款項目外，主要由於合同鑽探支出從第二季的40700萬增加到42300萬，部分原因是因為 伴隨VALARIS 247的攤銷動員費用增加，以及VALARIS DS-7全季運營成本上升，相關成本較高。這在一定程度上被與VALARIS DS-17工作地點變更相關的低重新啟動費用和低人員成本部分抵銷。
折舊費用從2024年第二季的3000萬元增加到3200萬元，主要是由於重新啟動項目和資本升級為某些鑽井平台投入服務的新資產。2024年第二季總和行政費用從3300萬元降至3100萬元，主要是由於專業費用較低。
其他支出為800萬元，與2024年第二季度其他收入1200萬元相比，主要是由於利息收入和外幣兌換虧損減少，而與第二季度收益相比。
2024年第二季度稅費為2400萬美元，而第三季度稅款則包括一筆微不足道的離散稅款，第二季度則包括6400萬美元的離散減免稅款，這主要歸因於對於先前年度納稅部位的未認列稅款利益負債的變化。
考慮離散稅務項目後，稅費從第二季度的3.4億美元降至2.4億美元。
資本支出為8200萬美元，比2024年第二季度的1.1億美元下降主要是由於較低的維護和升級資本支出。
現金及現金等價物和受限現金於2024年9月30日降至3.92億美元，低於2024年6月30日的4.1億美元。此下降主要是由於股份回購和資本支出，部分抵銷自營業現金流。
第三季度部門回顧
飛蚊症
浮動平台的收入從2024年第二季的38400萬美元增至38900萬美元。不包括可退款項目，收入從第二季的37000萬美元增至37300萬美元。主要增長原因為VALARIS DS-7的運營天數增加，該船於第二季啟動合同，以及浮動平台艦隊的平均日收入較高，主要是因為VALARIS DS-16，在第二季末啟動了新的更高日費合同。這在一定程度上被VALARIS DPS-5和DS-10的運營天數減少所抵銷，這兩者在第三季完成了他們的合同。
承包鑽探支出從2024年第二季的25700萬美元降至24800萬美元。在扣除可退還項目後，2024年第二季的承包鑽探支出從24500萬美元降至23500萬美元。主要是由於VALARIS DS-7在第二季回歸工作，降低了重新啟動費用，以及與VALARIS DS-17有關的人員費用因營運地點變更而降低。這部分被VALARIS DS-7一整個季度的運營成本增加部分抵消。
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提升機
Jackup 營業收入由2024年第二季的18600萬元增加至21400萬元。扣除可退還項目後，營業收入由2024年第二季的16700萬元增加至19300萬元，主要是由於 VALARIS 247 開始在澳洲外海執行合同，其在7月從英國調動開始的折舊攤銷收入以及營運天數增加所致。部分被 VALARIS 249 的腳修理停機時間抵銷。
Contract drilling expense increased to $157 million from $123 million in the second quarter 2024. Excluding reimbursable items, contract drilling expense increased to $137 million from $108 million in the second quarter primarily due to an increase in amortized mobilization expense associated with VALARIS 247 and repair costs for VALARIS 249.
ARO Drilling
Revenues decreased to $114 million from $124 million in the second quarter 2024 primarily due to the contract termination for VALARIS 143 in the second quarter and contract suspensions for VALARIS 147 and 148 during the third quarter. Subsequently, ARO elected to terminate these suspended contracts in October. Contract drilling expense of $94 million was in line with the second quarter.
Other
Revenues of $40 million were in line with the second quarter 2024. Contract drilling expense increased to $22 million from $20 million in the second quarter.
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Floaters | Jackups | ARO (1) | Other | Reconciling Items (1)(2) | Consolidated Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions of $, except %) | Q3 2024 | Q2 2024 | Chg | Q3 2024 | Q2 2024 | Chg | Q3 2024 | Q2 2024 | Chg | Q3 2024 | Q2 2024 | Chg | Q3 2024 | Q2 2024 | Q3 2024 | Q2 2024 | Chg | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 389.0 | $ | 383.9 | 1 | % | $ | 213.7 | $ | 185.8 | 15 | % | $ | 113.7 | $ | 124.2 | (8) | % | $ | 40.4 | $ | 40.4 | — | % | $ | (113.7) | $ | (124.2) | $ | 643.1 | $ | 610.1 | 5 | % | ||||||||||||||||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contract drilling | 247.7 | 257.4 | 4 | % | 156.7 | 123.2 | (27) | % | 93.8 | 94.1 | — | % | 22.1 | 19.6 | (13) | % | (58.2) | (55.6) | 462.1 | 438.7 | (5) | % | ||||||||||||||||||||||||||||||||||||||||||||||
Loss on impairment | — | — | — | % | — | — | — | % | 28.4 | — | nm | — | — | — | % | (28.4) | — | — | — | — | % | |||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation | 14.8 | 14.1 | (5) | % | 11.4 | 10.9 | (5) | % | 21.1 | 19.7 | (7) | % | 2.9 | 2.5 | (16) | % | (18.5) | (17.5) | 31.7 | 29.7 | (7) | % | ||||||||||||||||||||||||||||||||||||||||||||||
| General and admin. | — | — | — | % | — | — | — | % | 4.9 | 5.5 | 11 | % | — | — | — | % | 25.7 | 27.0 | 30.6 | 32.5 | 6 | % | ||||||||||||||||||||||||||||||||||||||||||||||
| Equity in losses of ARO | — | — | — | % | — | — | — | % | — | — | — | % | — | — | — | % | (23.8) | (0.3) | (23.8) | (0.3) | nm | |||||||||||||||||||||||||||||||||||||||||||||||
Operating income (loss) | $ | 126.5 | $ | 112.4 | 13 | % | $ | 45.6 | $ | 51.7 | (12) | % | $ | (34.5) | $ | 4.9 | nm | $ | 15.4 | $ | 18.3 | (16) | % | $ | (58.1) | $ | (78.4) | $ | 94.9 | $ | 108.9 | (13) | % | |||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 126.8 | $ | 114.1 | 11 | % | $ | 45.7 | $ | 52.8 | (13) | % | $ | (54.0) | $ | (6.7) | nm | $ | 16.3 | $ | 18.3 | (11) | % | $ | (71.9) | $ | (27.7) | $ | 62.9 | $ | 150.8 | (58) | % | |||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 141.3 | $ | 126.4 | 12 | % | $ | 57.0 | $ | 62.6 | (9) | % | $ | 15.0 | $ | 24.6 | (39) | % | $ | 18.3 | $ | 20.8 | (12) | % | $ | (81.2) | $ | (95.5) | $ | 150.4 | $ | 138.9 | 8 | % | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDAR | $ | 143.2 | $ | 137.3 | 4 | % | $ | 57.0 | $ | 62.6 | (9) | % | $ | 15.0 | $ | 24.6 | (39) | % | $ | 18.3 | $ | 20.8 | (12) | % | $ | (81.2) | $ | (95.5) | $ | 152.3 | $ | 149.8 | 2 | % | ||||||||||||||||||||||||||||||||||
nm - Not meaningful
(1) The full operating results included above for ARO are not included within our consolidated results and thus deducted under "Reconciling Items" and replaced with our equity in earnings of ARO.
(2) Our onshore support costs included within contract drilling expenses are not allocated to our operating segments for purposes of measuring segment operating income (loss) and as such, these costs are included in "Reconciling Items." Further, general and administrative expense and depreciation expense incurred by our corporate office are not allocated to our operating segments for purposes of measuring segment operating income (loss) and are included in "Reconciling Items."
As previously announced, Valaris will hold its third quarter 2024 earnings conference call at 9:00 a.m. CT (10:00 a.m. ET) on Thursday, October 31, 2024. An updated investor presentation will be available on the Valaris website after the call.
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About Valaris Limited
Valaris Limited (NYSE: VAL) is the industry leader in offshore drilling services across all water depths and geographies. Operating a high-quality rig fleet of ultra-deepwater drillships, versatile semisubmersibles, and modern shallow-water jackups, Valaris has experience operating in nearly every major offshore basin. Valaris maintains an unwavering commitment to safety, operational excellence, and customer satisfaction, with a focus on technology and innovation. Valaris Limited is a Bermuda exempted company. To learn more, visit the Valaris website at www.valaris.com.
Forward-Looking Statements
Statements contained in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include words or phrases such as "anticipate," "believe," "estimate," "expect," "intend," "likely," "plan," "project," "could," "may," "might," "should," "will" and similar words and specifically include statements regarding expected financial performance; expected utilization, day rates, revenues, operating expenses, cash flows, contract status, terms and duration, contract backlog, capital expenditures, insurance, financing and funding; the offshore drilling market, including supply and demand, customer drilling programs and the attainment of requisite permits for such programs, stacking of rigs, effects of new rigs on the market and effect of the volatility of commodity prices; expected work commitments, awards, contracts and letters of intent; scheduled delivery dates for rigs; performance of our joint ventures, including our joint venture with Saudi Aramco; timing of the delivery of the Saudi Aramco Rowan Offshore Drilling Company ("ARO") newbuild rigs and the timing of additional ARO newbuild orders; the availability, delivery, mobilization, contract commencement, availability, relocation or other movement of rigs and the timing thereof; rig reactivations; suitability of rigs for future contracts; divestitures of assets; general economic, market, business and industry conditions, including inflation and recessions, trends and outlook; general political conditions, including political tensions, conflicts and war; cybersecurity attacks and threats; impacts and effects of public health crises, pandemics and epidemics; future operations; ability to renew expiring contracts or obtain new contracts, including for VALARIS DS-13 and VALARIS DS-14; increasing regulatory complexity; targets, progress, plans and goals related to sustainability matters; the outcome of tax disputes; assessments and settlements; and expense management. The forward-looking statements contained in this press release are subject to numerous risks, uncertainties and assumptions that may cause actual results to vary materially from those indicated, including cancellation, suspension, renegotiation or termination of drilling contracts and programs; our ability to obtain financing, service our debt, fund capital expenditures and pursue other business opportunities; adequacy of sources of liquidity for us and our customers; future share repurchases; actions by regulatory authorities, or other third parties; actions by our security holders; internal control risk; commodity price fluctuations and volatility, customer demand, loss of a significant customer or customer contract, downtime and other risks associated with offshore rig operations; adverse weather, including hurricanes; changes in worldwide rig supply, including as a result of reactivations and newbuilds; and demand, competition and technology; supply chain and logistics challenges; consumer preferences for alternative fuels and forecasts or expectations regarding the global energy transition; increased scrutiny of our sustainability targets, initiatives and reporting and our ability to achieve such targets or initiatives; changes in customer strategy; future levels of offshore drilling activity; governmental action, civil unrest and political and economic uncertainties, including recessions, volatility affecting the banking system and financial markets, inflation and adverse changes in the level of international trade activity; terrorism, piracy and military action; risks inherent to shipyard rig reactivation, upgrade, repair, maintenance or enhancement; our ability to enter into, and the terms of, future drilling contracts; suitability of rigs for future contracts; the cancellation of letters of intent or letters of award or any failure to execute definitive contracts following announcements of letters of intent, letters of award or other expected work commitments; the outcome of litigation, legal proceedings, investigations or other claims or contract disputes; governmental regulatory, legislative and permitting requirements affecting drilling operations; our ability to attract and retain skilled personnel on commercially reasonable terms; environmental or other liabilities, risks or losses; compliance with our debt agreements and debt restrictions that may limit our liquidity and flexibility, including in any return of capital plans; cybersecurity risks and threats; and changes in foreign currency exchange rates. In addition to the numerous factors described above, you should also carefully read and consider "Item 1A. Risk Factors" in Part I and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II of our most recent annual report on Form 10-K, which is available on the Securities and Exchange Commission's website at www.sec.gov or on the Investor Relations section of our website at www.valaris.com. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to update or revise any forward-looking statements, except as required by law.
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| Investor & Media Contacts: | Nick Georgas | ||||
Vice President - Treasurer and Investor Relations | |||||
+1-713-979-4632 | |||||
| Tim Richardson | |||||
| Director - Investor Relations | |||||
+1-713-979-4619 | |||||
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| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
| (In millions, except per share amounts) | ||||||||||||||
(Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
| OPERATING REVENUES | $ | 643.1 | $ | 610.1 | $ | 525.0 | $ | 483.8 | $ | 455.1 | |||||||||||||||||||
| OPERATING EXPENSES | |||||||||||||||||||||||||||||
| Contract drilling (exclusive of depreciation) | 462.1 | 438.7 | 444.8 | 402.0 | 390.9 | ||||||||||||||||||||||||
| Depreciation | 31.7 | 29.7 | 26.8 | 27.5 | 25.8 | ||||||||||||||||||||||||
| General and administrative | 30.6 | 32.5 | 26.5 | 24.3 | 24.2 | ||||||||||||||||||||||||
| Total operating expenses | 524.4 | 500.9 | 498.1 | 453.8 | 440.9 | ||||||||||||||||||||||||
| EQUITY IN EARNINGS (LOSSES) OF ARO | (23.8) | (0.3) | 2.4 | 8.3 | 2.4 | ||||||||||||||||||||||||
| OPERATING INCOME | 94.9 | 108.9 | 29.3 | 38.3 | 16.6 | ||||||||||||||||||||||||
| OTHER INCOME (EXPENSE) | |||||||||||||||||||||||||||||
| Interest income | 17.5 | 31.0 | 21.0 | 27.2 | 26.6 | ||||||||||||||||||||||||
| Interest expense, net | (22.4) | (22.6) | (17.7) | (21.7) | (19.4) | ||||||||||||||||||||||||
| Other, net | (2.8) | 3.5 | 5.8 | (5.5) | 3.9 | ||||||||||||||||||||||||
| (7.7) | 11.9 | 9.1 | — | 11.1 | |||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | 87.2 | 120.8 | 38.4 | 38.3 | 27.7 | ||||||||||||||||||||||||
| PROVISION (BENEFIT) FOR INCOME TAXES | 24.3 | (30.0) | 12.9 | (790.2) | 10.7 | ||||||||||||||||||||||||
| NET INCOME | 62.9 | 150.8 | 25.5 | 828.5 | 17.0 | ||||||||||||||||||||||||
| NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 1.7 | (1.2) | — | 6.7 | (4.1) | ||||||||||||||||||||||||
| NET INCOME ATTRIBUTABLE TO VALARIS | $ | 64.6 | $ | 149.6 | $ | 25.5 | $ | 835.2 | $ | 12.9 | |||||||||||||||||||
| EARNINGS PER SHARE | |||||||||||||||||||||||||||||
| Basic | $ | 0.89 | $ | 2.07 | $ | 0.35 | $ | 11.47 | $ | 0.18 | |||||||||||||||||||
| Diluted | $ | 0.88 | $ | 2.03 | $ | 0.35 | $ | 11.30 | $ | 0.17 | |||||||||||||||||||
| WEIGHTED-AVERAGE SHARES OUTSTANDING | |||||||||||||||||||||||||||||
| Basic | 72.4 | 72.4 | 72.4 | 72.8 | 73.7 | ||||||||||||||||||||||||
| Diluted | 73.2 | 73.7 | 73.6 | 73.9 | 74.8 | ||||||||||||||||||||||||
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| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| (In millions) | ||||||||||||||
(Unaudited) | ||||||||||||||
| As of | |||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||
| ASSETS | |||||||||||||||||
| CURRENT ASSETS | |||||||||||||||||
| Cash and cash equivalents | $ | 379.3 | $ | 398.3 | $ | 494.1 | $ | 620.5 | $ | 1,041.1 | |||||||
| Restricted cash | 12.9 | 12.0 | 15.0 | 15.2 | 16.2 | ||||||||||||
| Accounts receivable, net | 555.8 | 631.7 | 510.9 | 459.3 | 492.4 | ||||||||||||
| Other current assets | 163.5 | 182.6 | 177.6 | 177.2 | 178.7 | ||||||||||||
| Total current assets | $ | 1,111.5 | $ | 1,224.6 | $ | 1,197.6 | $ | 1,272.2 | $ | 1,728.4 | |||||||
| PROPERTY AND EQUIPMENT, NET | 1,842.7 | 1,809.4 | 1,732.3 | 1,633.8 | 1,159.9 | ||||||||||||
| LONG-TERM NOTES RECEIVABLE FROM ARO | 265.4 | 259.2 | 289.3 | 282.3 | 275.2 | ||||||||||||
| INVESTMENT IN ARO | 102.7 | 126.5 | 126.8 | 124.4 | 116.1 | ||||||||||||
| DEFERRED TAX ASSETS | 837.0 | 841.1 | 854.8 | 855.1 | 53.8 | ||||||||||||
| OTHER ASSETS | 174.1 | 154.8 | 153.6 | 154.4 | 151.5 | ||||||||||||
| $ | 4,333.4 | $ | 4,415.6 | $ | 4,354.4 | $ | 4,322.2 | $ | 3,484.9 | ||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||||||
| CURRENT LIABILITIES | |||||||||||||||||
| Accounts payable - trade | $ | 303.7 | $ | 347.0 | $ | 394.2 | $ | 400.1 | $ | 376.4 | |||||||
| Accrued liabilities and other | 388.6 | 360.6 | 366.5 | 344.2 | 346.6 | ||||||||||||
| Total current liabilities | $ | 692.3 | $ | 707.6 | $ | 760.7 | $ | 744.3 | $ | 723.0 | |||||||
| LONG-TERM DEBT | 1,081.8 | 1,081.0 | 1,080.1 | 1,079.3 | 1,079.4 | ||||||||||||
| DEFERRED TAX LIABILITIES | 31.1 | 31.2 | 31.6 | 29.9 | 17.1 | ||||||||||||
| OTHER LIABILITIES | 404.4 | 408.4 | 451.7 | 471.7 | 465.4 | ||||||||||||
| TOTAL LIABILITIES | 2,209.6 | 2,228.2 | 2,324.1 | 2,325.2 | 2,284.9 | ||||||||||||
| TOTAL EQUITY | 2,123.8 | 2,187.4 | 2,030.3 | 1,997.0 | 1,200.0 | ||||||||||||
| $ | 4,333.4 | $ | 4,415.6 | $ | 4,354.4 | $ | 4,322.2 | $ | 3,484.9 | ||||||||
7
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| OPERATING ACTIVITIES | |||||||||||
| Net income | $ | 239.2 | $ | 38.3 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation expense | 88.2 | 73.6 | |||||||||
| Accretion of discount on notes receivable from ARO | (33.8) | (21.2) | |||||||||
| Share-based compensation expense | 22.4 | 19.5 | |||||||||
| Equity in losses (earnings) of ARO | 21.7 | (5.0) | |||||||||
| Deferred income tax expense | 19.3 | 2.3 | |||||||||
| Net (gain) loss on sale of property | 0.3 | (27.9) | |||||||||
| Loss on extinguishment of debt | — | 29.2 | |||||||||
| Changes in contract liabilities | (13.5) | (3.9) | |||||||||
| Changes in deferred costs | 32.6 | (29.3) | |||||||||
| Other | 5.0 | 5.2 | |||||||||
| Changes in other operating assets and liabilities | (131.0) | 94.5 | |||||||||
| Contributions to pension plans and other post-retirement benefits | (19.6) | (4.5) | |||||||||
| Net cash provided by operating activities | $ | 230.8 | $ | 170.8 | |||||||
| INVESTING ACTIVITIES | |||||||||||
| Additions to property and equipment | $ | (343.4) | $ | (233.1) | |||||||
| Net proceeds from disposition of assets | 0.2 | 29.2 | |||||||||
| Net cash used in investing activities | $ | (343.2) | $ | (203.9) | |||||||
| FINANCING ACTIVITIES | |||||||||||
| Payments for share repurchases | $ | (101.4) | $ | (147.4) | |||||||
| Payments related to tax withholdings for share-based awards | (29.7) | (5.2) | |||||||||
| Issuance of Second Lien Notes | — | 1,103.0 | |||||||||
| Redemption of First Lien Notes | — | (571.8) | |||||||||
| Debt issuance costs | — | (36.7) | |||||||||
| Net cash provided by (used in) financing activities | $ | (131.1) | $ | 341.9 | |||||||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | $ | (243.5) | $ | 308.8 | |||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | 635.7 | 748.5 | |||||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $ | 392.2 | $ | 1,057.3 | |||||||
8
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||
| OPERATING ACTIVITIES | |||||||||||||||||
| Net income | $ | 62.9 | $ | 150.8 | $ | 25.5 | $ | 828.5 | $ | 17.0 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||
| Depreciation expense | 31.7 | 29.7 | 26.8 | 27.5 | 25.8 | ||||||||||||
| Equity in losses (earnings) of ARO | 23.8 | 0.3 | (2.4) | (8.3) | (2.4) | ||||||||||||
| Share-based compensation expense | 7.0 | 7.4 | 8.0 | 7.8 | 6.8 | ||||||||||||
| Accretion of discount on notes receivable from ARO | (6.2) | (20.6) | (7.0) | (7.1) | (7.2) | ||||||||||||
| Deferred income tax expense (benefit) | 3.8 | 13.5 | 2.0 | (788.7) | (4.8) | ||||||||||||
| Net (gain) loss on sale of property | 0.2 | — | 0.1 | (0.7) | — | ||||||||||||
| Changes in contract liabilities | 11.3 | (17.8) | (7.0) | 8.8 | 3.6 | ||||||||||||
| Changes in deferred costs | 33.4 | (3.0) | 2.2 | 3.2 | (22.4) | ||||||||||||
| Other | 0.8 | 2.4 | 1.8 | 0.6 | 2.7 | ||||||||||||
| Changes in other operating assets and liabilities | 37.8 | (147.5) | (21.3) | 27.3 | 31.0 | ||||||||||||
| Contributions to pension plans and other post-retirement benefits | (13.5) | (3.7) | (2.4) | (2.2) | (1.9) | ||||||||||||
| Net cash provided by operating activities | $ | 193.0 | $ | 11.5 | $ | 26.3 | $ | 96.7 | $ | 48.2 | |||||||
| INVESTING ACTIVITIES | |||||||||||||||||
| Additions to property and equipment | $ | (81.9) | $ | (110.2) | $ | (151.3) | $ | (463.0) | $ | (105.8) | |||||||
| Net proceeds from disposition of assets | 0.1 | 0.1 | — | 1.1 | 0.1 | ||||||||||||
| Net cash used in investing activities | $ | (81.8) | $ | (110.1) | $ | (151.3) | $ | (461.9) | $ | (105.7) | |||||||
| FINANCING ACTIVITIES | |||||||||||||||||
| Payments for share repurchases | $ | (100.0) | $ | — | $ | (1.4) | $ | (51.2) | $ | (83.0) | |||||||
| Payments for tax withholdings for share-based awards | (29.3) | (0.2) | (0.2) | (0.2) | (4.8) | ||||||||||||
| Debt issuance costs | — | — | — | (1.9) | (5.7) | ||||||||||||
| Issuance of Second Lien Notes | — | — | — | — | 403.0 | ||||||||||||
| Other | — | — | — | (3.1) | — | ||||||||||||
| Net cash provided by (used in) financing activities | $ | (129.3) | $ | (0.2) | $ | (1.6) | $ | (56.4) | $ | 309.5 | |||||||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | $ | (18.1) | $ | (98.8) | $ | (126.6) | $ | (421.6) | $ | 252.0 | |||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | 410.3 | 509.1 | 635.7 | 1,057.3 | 805.3 | ||||||||||||
| CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $ | 392.2 | $ | 410.3 | $ | 509.1 | $ | 635.7 | $ | 1,057.3 | |||||||
9
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | $ | 322.3 | $ | 291.5 | $ | 249.6 | $ | 190.7 | $ | 168.2 | |||||||||||||||||||
| Semisubmersibles | 50.9 | 78.9 | 60.2 | 56.3 | 64.1 | ||||||||||||||||||||||||
| $ | 373.2 | $ | 370.4 | $ | 309.8 | $ | 247.0 | $ | 232.3 | ||||||||||||||||||||
Reimbursable and Other Revenues (1) | 15.8 | 13.5 | 14.6 | 16.2 | 11.0 | ||||||||||||||||||||||||
Total Floaters | $ | 389.0 | $ | 383.9 | $ | 324.4 | $ | 263.2 | $ | 243.3 | |||||||||||||||||||
Jackups (2) | |||||||||||||||||||||||||||||
HD Harsh Environment | $ | 118.8 | $ | 87.6 | $ | 67.5 | $ | 76.6 | $ | 75.5 | |||||||||||||||||||
| HD & SD Modern | 58.4 | 63.7 | 56.9 | 79.0 | 68.8 | ||||||||||||||||||||||||
| SD Legacy | 15.4 | 15.4 | 14.8 | 14.2 | 10.5 | ||||||||||||||||||||||||
| $ | 192.6 | $ | 166.7 | $ | 139.2 | $ | 169.8 | $ | 154.8 | ||||||||||||||||||||
Reimbursable and Other Revenues (1) | 21.1 | 19.1 | 13.1 | 9.5 | 11.1 | ||||||||||||||||||||||||
Total Jackups | $ | 213.7 | $ | 185.8 | $ | 152.3 | $ | 179.3 | $ | 165.9 | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | $ | 32.4 | $ | 35.6 | $ | 42.1 | $ | 36.0 | $ | 40.1 | |||||||||||||||||||
Reimbursable and Other Revenues (1) | 8.0 | 4.8 | 6.2 | 5.3 | 5.8 | ||||||||||||||||||||||||
Total Other | $ | 40.4 | $ | 40.4 | $ | 48.3 | $ | 41.3 | $ | 45.9 | |||||||||||||||||||
Total Operating Revenues | $ | 643.1 | $ | 610.1 | $ | 525.0 | $ | 483.8 | $ | 455.1 | |||||||||||||||||||
Total Reimbursable and Other Revenues (1) | $ | 44.9 | $ | 37.4 | $ | 33.9 | $ | 31.0 | $ | 27.9 | |||||||||||||||||||
Revenues Excluding Reimbursable and Other Revenues | $ | 598.2 | $ | 572.7 | $ | 491.1 | $ | 452.8 | $ | 427.2 | |||||||||||||||||||
(1)Reimbursable and other revenues includes certain types of non-recurring reimbursable revenues, revenues earned during suspension periods and revenues attributable to amortization of contract intangibles.
(2)HD = Heavy Duty; SD = Standard Duty. Heavy duty jackups are well-suited for operations in tropical revolving storm areas.
10
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
ADJUSTED EBITDA (1) | |||||||||||||||||||||||||||||
Floaters | |||||||||||||||||||||||||||||
| Drillships | $ | 130.9 | $ | 91.2 | $ | 55.6 | $ | 16.7 | $ | 2.8 | |||||||||||||||||||
| Semisubmersibles | 10.4 | 35.2 | 15.4 | 20.5 | 25.4 | ||||||||||||||||||||||||
| $ | 141.3 | $ | 126.4 | $ | 71.0 | $ | 37.2 | $ | 28.2 | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | $ | 31.4 | $ | 36.3 | $ | 5.4 | $ | 21.1 | $ | 20.9 | |||||||||||||||||||
| HD & SD Modern | 20.0 | 21.3 | 8.6 | 30.1 | 20.4 | ||||||||||||||||||||||||
| SD Legacy | 5.6 | 5.0 | 4.4 | 4.8 | 2.9 | ||||||||||||||||||||||||
| $ | 57.0 | $ | 62.6 | $ | 18.4 | $ | 56.0 | $ | 44.2 | ||||||||||||||||||||
| Total | $ | 198.3 | $ | 189.0 | $ | 89.4 | $ | 93.2 | $ | 72.4 | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | $ | 18.3 | $ | 20.8 | $ | 26.1 | $ | 23.2 | $ | 27.2 | |||||||||||||||||||
| Total | $ | 216.6 | $ | 209.8 | $ | 115.5 | $ | 116.4 | $ | 99.6 | |||||||||||||||||||
| Support costs | |||||||||||||||||||||||||||||
| General and administrative expense | $ | 30.6 | $ | 32.5 | $ | 26.5 | $ | 24.3 | $ | 24.2 | |||||||||||||||||||
| Onshore support costs | 35.6 | 38.4 | 35.3 | 34.6 | 35.4 | ||||||||||||||||||||||||
| $ | 66.2 | $ | 70.9 | $ | 61.8 | $ | 58.9 | $ | 59.6 | ||||||||||||||||||||
Total | $ | 150.4 | $ | 138.9 | $ | 53.7 | $ | 57.5 | $ | 40.0 | |||||||||||||||||||
(1)Adjusted EBITDA is earnings before interest, tax, depreciation and amortization. Adjusted EBITDA for asset category also excludes onshore support costs and general and administrative expense.
11
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
ADJUSTED EBITDAR (1) | |||||||||||||||||||||||||||||
Active Fleet (2) | $ | 213.1 | $ | 218.1 | $ | 126.3 | $ | 137.5 | $ | 129.3 | |||||||||||||||||||
Leased and Managed Rigs | 18.3 | 20.8 | 26.1 | 23.2 | 27.2 | ||||||||||||||||||||||||
| $ | 231.4 | $ | 238.9 | $ | 152.4 | $ | 160.7 | $ | 156.5 | ||||||||||||||||||||
Stacked Fleet (3) | (12.9) | (18.2) | (6.6) | (5.8) | (6.0) | ||||||||||||||||||||||||
| $ | 218.5 | $ | 220.7 | $ | 145.8 | $ | 154.9 | $ | 150.5 | ||||||||||||||||||||
| Support costs | |||||||||||||||||||||||||||||
| General and administrative expense | $ | 30.6 | $ | 32.5 | $ | 26.5 | $ | 24.3 | $ | 24.2 | |||||||||||||||||||
| Onshore support costs | 35.6 | 38.4 | 35.3 | 34.6 | 35.4 | ||||||||||||||||||||||||
| $ | 66.2 | $ | 70.9 | $ | 61.8 | $ | 58.9 | $ | 59.6 | ||||||||||||||||||||
Total | $ | 152.3 | $ | 149.8 | $ | 84.0 | $ | 96.0 | $ | 90.9 | |||||||||||||||||||
Reactivation costs (4) | $ | 1.9 | $ | 10.9 | $ | 30.3 | $ | 38.5 | $ | 50.9 | |||||||||||||||||||
(1)Adjusted EBITDAR is earnings before interest, tax, depreciation, amortization and reactivation costs. Adjusted EBITDAR for active fleet, leased and managed rigs and stacked fleet also excludes onshore support costs and general and administrative expense.
(2)Active fleet represents rigs that are not preservation stacked and includes rigs that are in the process of being reactivated.
(3)Adjusted EBITDAR for the stacked fleet represents the combined total of all preservation and stacking costs.
(4)Reactivation costs, all of which are attributed to Valaris' active fleet, are excluded from adjusted EBITDAR.
12
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
ADJUSTED EBITDAR (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | $ | 132.8 | $ | 102.1 | $ | 85.9 | $ | 55.2 | $ | 53.7 | |||||||||||||||||||
| Semisubmersibles | 10.4 | 35.2 | 15.4 | 20.5 | 25.4 | ||||||||||||||||||||||||
| $ | 143.2 | $ | 137.3 | $ | 101.3 | $ | 75.7 | $ | 79.1 | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | $ | 31.4 | $ | 36.3 | $ | 5.4 | $ | 21.1 | $ | 20.9 | |||||||||||||||||||
| HD & SD Modern | 20.0 | 21.3 | 8.6 | 30.1 | 20.4 | ||||||||||||||||||||||||
| SD Legacy | 5.6 | 5.0 | 4.4 | 4.8 | 2.9 | ||||||||||||||||||||||||
| $ | 57.0 | $ | 62.6 | $ | 18.4 | $ | 56.0 | $ | 44.2 | ||||||||||||||||||||
| Total | $ | 200.2 | $ | 199.9 | $ | 119.7 | $ | 131.7 | $ | 123.3 | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | $ | 18.3 | $ | 20.8 | $ | 26.1 | $ | 23.2 | $ | 27.2 | |||||||||||||||||||
| Total | $ | 218.5 | $ | 220.7 | $ | 145.8 | $ | 154.9 | $ | 150.5 | |||||||||||||||||||
| Support costs | |||||||||||||||||||||||||||||
| General and administrative expense | $ | 30.6 | $ | 32.5 | $ | 26.5 | $ | 24.3 | $ | 24.2 | |||||||||||||||||||
| Onshore support costs | 35.6 | 38.4 | 35.3 | 34.6 | 35.4 | ||||||||||||||||||||||||
| $ | 66.2 | $ | 70.9 | $ | 61.8 | $ | 58.9 | $ | 59.6 | ||||||||||||||||||||
Total | $ | 152.3 | $ | 149.8 | $ | 84.0 | $ | 96.0 | $ | 90.9 | |||||||||||||||||||
(1)Adjusted EBITDAR is earnings before interest, tax, depreciation, amortization and reactivation costs. Adjusted EBITDAR for asset category also excludes onshore support costs and general and administrative expense.
13
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (In millions) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| As of | |||||||||||||||||||||||||||||
| Oct 30, 2024 | Jul 29, 2024 | Apr 30, 2024 | Feb 15, 2024 | Nov 1, 2023 | |||||||||||||||||||||||||
CONTRACT BACKLOG (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | $ | 2,289.7 | $ | 2,508.3 | $ | 2,223.9 | $ | 2,307.6 | $ | 1,726.5 | |||||||||||||||||||
| Semisubmersibles | 106.0 | 122.1 | 180.7 | 224.1 | 259.5 | ||||||||||||||||||||||||
| $ | 2,395.7 | $ | 2,630.4 | $ | 2,404.6 | $ | 2,531.7 | $ | 1,986.0 | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
| HD Harsh Environment | $ | 635.1 | $ | 665.0 | $ | 607.0 | $ | 646.8 | $ | 327.9 | |||||||||||||||||||
| HD & SD Modern | 585.2 | 438.9 | 449.1 | 347.1 | 406.8 | ||||||||||||||||||||||||
| SD Legacy | 178.4 | 189.0 | 128.8 | 173.5 | 186.9 | ||||||||||||||||||||||||
| $ | 1,398.7 | $ | 1,292.9 | $ | 1,184.9 | $ | 1,167.4 | $ | 921.6 | ||||||||||||||||||||
| Total | $ | 3,794.4 | $ | 3,923.3 | $ | 3,589.5 | $ | 3,699.1 | $ | 2,907.6 | |||||||||||||||||||
Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | $ | 310.4 | $ | 384.2 | $ | 427.7 | $ | 222.3 | $ | 250.5 | |||||||||||||||||||
Total | $ | 4,104.8 | $ | 4,307.5 | $ | 4,017.2 | $ | 3,921.4 | $ | 3,158.1 | |||||||||||||||||||
(1)Our contract drilling backlog reflects commitments, represented by signed drilling contracts, and is calculated by multiplying the contracted day rate by the contract period. Contract drilling backlog includes drilling contracts subject to FID and drilling contracts which grant the customer termination rights if FID is not received with respect to projects for which the drilling rig is contracted. The contracted day rate excludes certain types of lump sum fees for rig mobilization, demobilization, contract preparation, as well as customer reimbursables and bonus opportunities.
14
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
AVERAGE DAILY REVENUE (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | $ | 386,000 | $ | 358,000 | $ | 328,000 | $ | 307,000 | $ | 288,000 | |||||||||||||||||||
| Semisubmersibles | 247,000 | 289,000 | 261,000 | 229,000 | 257,000 | ||||||||||||||||||||||||
| $ | 359,000 | $ | 340,000 | $ | 312,000 | $ | 285,000 | $ | 279,000 | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | $ | 163,000 | $ | 134,000 | $ | 123,000 | $ | 111,000 | $ | 116,000 | |||||||||||||||||||
| HD & SD Modern | 111,000 | 115,000 | 103,000 | 119,000 | 105,000 | ||||||||||||||||||||||||
| SD Legacy | 84,000 | 85,000 | 81,000 | 79,000 | 83,000 | ||||||||||||||||||||||||
| $ | 133,000 | $ | 120,000 | $ | 108,000 | $ | 111,000 | $ | 108,000 | ||||||||||||||||||||
| Total | $ | 228,000 | $ | 217,000 | $ | 197,000 | $ | 174,000 | $ | 171,000 | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | $ | 32,000 | $ | 37,000 | $ | 45,000 | $ | 39,000 | $ | 44,000 | |||||||||||||||||||
Total | $ | 171,000 | $ | 167,000 | $ | 153,000 | $ | 136,000 | $ | 134,000 | |||||||||||||||||||
(1)Average daily revenue is derived by dividing contract drilling revenues, adjusted to exclude certain types of non-recurring reimbursable revenues, revenues earned during suspension periods, revenues attributable to amortization of drilling contract intangibles and lump-sum revenues and amortization thereof, by the aggregate number of operating days.
15
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
UTILIZATION - TOTAL FLEET (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 70 | % | 69 | % | 64 | % | 60 | % | 58 | % | |||||||||||||||||||
| Semisubmersibles | 45 | % | 60 | % | 51 | % | 53 | % | 54 | % | |||||||||||||||||||
| 63 | % | 66 | % | 61 | % | 58 | % | 57 | % | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 72 | % | 65 | % | 55 | % | 68 | % | 64 | % | |||||||||||||||||||
| HD & SD Modern | 44 | % | 45 | % | 44 | % | 52 | % | 51 | % | |||||||||||||||||||
| SD Legacy | 100 | % | 100 | % | 100 | % | 97 | % | 69 | % | |||||||||||||||||||
| 60 | % | 58 | % | 53 | % | 62 | % | 58 | % | ||||||||||||||||||||
| Total | 61 | % | 61 | % | 56 | % | 60 | % | 57 | % | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||||||
Total | 69 | % | 69 | % | 64 | % | 68 | % | 65 | % | |||||||||||||||||||
Pro Forma Jackups (2) | 71 | % | 68 | % | 64 | % | 70 | % | 67 | % | |||||||||||||||||||
(1)Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the total fleet.
(2)Includes all Valaris jackups including those leased to ARO Drilling.
16
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
UTILIZATION - ACTIVE FLEET (1) (2) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 91 | % | 90 | % | 84 | % | 68 | % | 63 | % | |||||||||||||||||||
| Semisubmersibles | 75 | % | 100 | % | 85 | % | 89 | % | 90 | % | |||||||||||||||||||
| 87 | % | 92 | % | 84 | % | 72 | % | 70 | % | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 88 | % | 80 | % | 67 | % | 83 | % | 79 | % | |||||||||||||||||||
| HD & SD Modern | 82 | % | 81 | % | 69 | % | 80 | % | 79 | % | |||||||||||||||||||
| SD Legacy | 100 | % | 100 | % | 100 | % | 97 | % | 68 | % | |||||||||||||||||||
| 87 | % | 82 | % | 71 | % | 83 | % | 78 | % | ||||||||||||||||||||
| Total | 87 | % | 86 | % | 76 | % | 79 | % | 75 | % | |||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||||||
Total | 90 | % | 90 | % | 82 | % | 84 | % | 81 | % | |||||||||||||||||||
Pro Forma Jackups (3) | 91 | % | 88 | % | 80 | % | 88 | % | 84 | % | |||||||||||||||||||
(1)Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the active fleet.
(2)Active fleet represents rigs that are not preservation stacked and includes rigs that are in the process of being reactivated.
(3)Includes all Valaris jackups including those leased to ARO Drilling.
17
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
AVAILABLE DAYS - TOTAL FLEET (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 1,196 | 1,183 | 1,183 | 1,032 | 1,012 | ||||||||||||||||||||||||
| Semisubmersibles | 460 | 455 | 455 | 460 | 460 | ||||||||||||||||||||||||
| 1,656 | 1,638 | 1,638 | 1,492 | 1,472 | |||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 1,012 | 1,001 | 1,001 | 1,012 | 1,012 | ||||||||||||||||||||||||
| HD & SD Modern | 1,196 | 1,225 | 1,258 | 1,288 | 1,288 | ||||||||||||||||||||||||
| SD Legacy | 184 | 182 | 182 | 184 | 184 | ||||||||||||||||||||||||
| 2,392 | 2,408 | 2,441 | 2,484 | 2,484 | |||||||||||||||||||||||||
| Total | 4,048 | 4,046 | 4,079 | 3,976 | 3,956 | ||||||||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | 1,012 | 959 | 926 | 920 | 920 | ||||||||||||||||||||||||
Total | 5,060 | 5,005 | 5,005 | 4,896 | 4,876 | ||||||||||||||||||||||||
(1)Represents the maximum number of days available in the period for the total fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, irrespective of asset status.
18
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
AVAILABLE DAYS - ACTIVE FLEET (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 920 | 910 | 910 | 920 | 920 | ||||||||||||||||||||||||
| Semisubmersibles | 276 | 273 | 273 | 276 | 276 | ||||||||||||||||||||||||
| 1,196 | 1,183 | 1,183 | 1,196 | 1,196 | |||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 828 | 819 | 819 | 828 | 828 | ||||||||||||||||||||||||
| HD & SD Modern | 644 | 683 | 803 | 828 | 828 | ||||||||||||||||||||||||
| SD Legacy | 184 | 182 | 182 | 184 | 184 | ||||||||||||||||||||||||
| 1,656 | 1,684 | 1,804 | 1,840 | 1,840 | |||||||||||||||||||||||||
| Total | 2,852 | 2,867 | 2,987 | 3,036 | 3,036 | ||||||||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | 1,012 | 959 | 926 | 920 | 920 | ||||||||||||||||||||||||
Total | 3,864 | 3,826 | 3,913 | 3,956 | 3,956 | ||||||||||||||||||||||||
(1)Represents the maximum number of days available in the period for the active fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, for active rigs only. Active rigs are defined as rigs that are not preservation stacked.
19
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
OPERATING DAYS (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 834 | 815 | 761 | 622 | 584 | ||||||||||||||||||||||||
| Semisubmersibles | 206 | 273 | 231 | 245 | 249 | ||||||||||||||||||||||||
| 1,040 | 1,088 | 992 | 867 | 833 | |||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 731 | 655 | 549 | 691 | 652 | ||||||||||||||||||||||||
| HD & SD Modern | 528 | 552 | 555 | 665 | 654 | ||||||||||||||||||||||||
| SD Legacy | 184 | 182 | 182 | 178 | 126 | ||||||||||||||||||||||||
| 1,443 | 1,389 | 1,286 | 1,534 | 1,432 | |||||||||||||||||||||||||
| Total | 2,483 | 2,477 | 2,278 | 2,401 | 2,265 | ||||||||||||||||||||||||
| Other | |||||||||||||||||||||||||||||
| Leased and Managed Rigs | 1,012 | 959 | 926 | 920 | 920 | ||||||||||||||||||||||||
Total | 3,495 | 3,436 | 3,204 | 3,321 | 3,185 | ||||||||||||||||||||||||
(1)Represents the total number of days under contract in the period. Days under contract equals the total number of days that rigs have earned and recognized day rate revenue, including days associated with early contract terminations, compensated downtime and mobilizations. When revenue is deferred and amortized over a future period, for example when we receive fees while mobilizing to commence a new contract or while being upgraded in a shipyard, the related days are excluded from days under contract.
20
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
REVENUE EFFICIENCY (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 98 | % | 99 | % | 94 | % | 88 | % | 89 | % | |||||||||||||||||||
| Semisubmersibles | 100 | % | 100 | % | 99 | % | 94 | % | 93 | % | |||||||||||||||||||
| 98 | % | 99 | % | 95 | % | 90 | % | 90 | % | ||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 93 | % | 99 | % | 100 | % | 99 | % | 99 | % | |||||||||||||||||||
| HD & SD Modern | 100 | % | 100 | % | 99 | % | 97 | % | 97 | % | |||||||||||||||||||
| SD Legacy | 100 | % | 100 | % | 100 | % | 97 | % | 99 | % | |||||||||||||||||||
| 96 | % | 99 | % | 99 | % | 98 | % | 98 | % | ||||||||||||||||||||
Total | 98 | % | 99 | % | 97 | % | 93 | % | 94 | % | |||||||||||||||||||
(1)Revenue efficiency is day rate revenue earned as a percentage of maximum potential day rate revenue.
21
| VALARIS LIMITED AND SUBSIDIARIES | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| As of | |||||||||||||||||||||||||||||
| NUMBER OF RIGS | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | ||||||||||||||||||||||||
Active Fleet (1) | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
| Drillships | 10 | 10 | 10 | 10 | 10 | ||||||||||||||||||||||||
| Semisubmersibles | 3 | 3 | 3 | 3 | 3 | ||||||||||||||||||||||||
| 13 | 13 | 13 | 13 | 13 | |||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 9 | 9 | 9 | 9 | 9 | ||||||||||||||||||||||||
| HD & SD Modern | 7 | 7 | 8 | 9 | 9 | ||||||||||||||||||||||||
| SD Legacy | 2 | 2 | 2 | 2 | 2 | ||||||||||||||||||||||||
| 18 | 18 | 19 | 20 | 20 | |||||||||||||||||||||||||
| Total Active Fleet | 31 | 31 | 32 | 33 | 33 | ||||||||||||||||||||||||
| Stacked Fleet | |||||||||||||||||||||||||||||
| Floaters | |||||||||||||||||||||||||||||
Drillships | 3 | 3 | 3 | 3 | 1 | ||||||||||||||||||||||||
| Semisubmersibles | 2 | 2 | 2 | 2 | 2 | ||||||||||||||||||||||||
| 5 | 5 | 5 | 5 | 3 | |||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 2 | 2 | 2 | 2 | 2 | ||||||||||||||||||||||||
| HD & SD Modern | 6 | 6 | 5 | 5 | 5 | ||||||||||||||||||||||||
| 8 | 8 | 7 | 7 | 7 | |||||||||||||||||||||||||
| Total Stacked Fleet | 13 | 13 | 12 | 12 | 10 | ||||||||||||||||||||||||
Leased Rigs (2) | |||||||||||||||||||||||||||||
| Jackups | |||||||||||||||||||||||||||||
HD Harsh Environment | 1 | 1 | 1 | 1 | 1 | ||||||||||||||||||||||||
| HD & SD Modern | 8 | 8 | 8 | 7 | 7 | ||||||||||||||||||||||||
| Total Leased Rigs | 9 | 9 | 9 | 8 | 8 | ||||||||||||||||||||||||
Total | 53 | 53 | 53 | 53 | 51 | ||||||||||||||||||||||||
Managed Rigs (2) | 2 | 2 | 2 | 2 | 2 | ||||||||||||||||||||||||
(1)Active fleet represents rigs that are not preservation stacked, including rigs that are in the process of being reactivated.
(2)Leased rigs and managed rigs included in Other reporting segment.
22
| ARO DRILLING | ||||||||||||||
| CONDENSED BALANCE SHEET INFORMATION | ||||||||||||||
| (In millions) | ||||||||||||||
(Unaudited) | ||||||||||||||
| As of | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
| Cash | $ | 129.3 | $ | 131.7 | $ | 69.5 | $ | 92.9 | $ | 110.3 | |||||||||||||||||||
| Other current assets | 129.4 | 157.8 | 198.3 | 184.0 | 191.2 | ||||||||||||||||||||||||
| Non-current assets | 1,223.3 | 1,214.4 | 1,094.2 | 1,081.0 | 915.3 | ||||||||||||||||||||||||
| Total assets | $ | 1,482.0 | $ | 1,503.9 | $ | 1,362.0 | $ | 1,357.9 | $ | 1,216.8 | |||||||||||||||||||
| Current liabilities | $ | 200.7 | $ | 173.2 | $ | 135.0 | $ | 136.0 | $ | 173.6 | |||||||||||||||||||
| Non-current liabilities | 1,176.9 | 1,172.2 | 1,057.6 | 1,056.8 | 886.2 | ||||||||||||||||||||||||
| Total liabilities | $ | 1,377.6 | $ | 1,345.4 | $ | 1,192.6 | $ | 1,192.8 | $ | 1,059.8 | |||||||||||||||||||
| Shareholders' equity | $ | 104.4 | $ | 158.5 | $ | 169.4 | $ | 165.1 | $ | 157.0 | |||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 1,482.0 | $ | 1,503.9 | $ | 1,362.0 | $ | 1,357.9 | $ | 1,216.8 | |||||||||||||||||||
| ARO DRILLING | ||||||||||||||
| CONDENSED INCOME STATEMENT INFORMATION | ||||||||||||||
| (In millions) | ||||||||||||||
(Unaudited) | ||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
| Revenues | $ | 113.7 | $ | 124.2 | $ | 138.3 | $ | 133.7 | $ | 121.5 | |||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||
| Contract drilling (exclusive of depreciation) | 93.8 | 94.1 | 98.3 | 88.0 | 92.0 | ||||||||||||||||||||||||
Loss on impairment | 28.4 | — | — | — | — | ||||||||||||||||||||||||
| Depreciation | 21.1 | 19.7 | 19.0 | 19.5 | 15.8 | ||||||||||||||||||||||||
| General and administrative | 4.9 | 5.5 | 5.8 | 6.3 | 5.6 | ||||||||||||||||||||||||
| Operating income (loss) | $ | (34.5) | $ | 4.9 | $ | 15.2 | $ | 19.9 | $ | 8.1 | |||||||||||||||||||
| Other expense, net | 15.3 | 13.4 | 13.1 | 3.6 | 9.0 | ||||||||||||||||||||||||
| Provision (benefit) for income taxes | 4.2 | (1.8) | 3.7 | 6.0 | 0.4 | ||||||||||||||||||||||||
| Net income (loss) | $ | (54.0) | $ | (6.7) | $ | (1.6) | $ | 10.3 | $ | (1.3) | |||||||||||||||||||
ARO Adjusted EBITDA | $ | 15.0 | $ | 24.6 | $ | 34.2 | $ | 39.4 | $ | 23.9 | |||||||||||||||||||
ARO Drilling condensed balance sheet and income statement information presented above represents 100% of ARO. Valaris has a 50% ownership interest in ARO.
23
| ARO DRILLING | ||||||||||||||
| OPERATING STATISTICS | ||||||||||||||
| (Unaudited) | ||||||||||||||
| As of | |||||||||||||||||||||||||||||
| (In millions) | Oct 30, 2024 | Jul 29, 2024 | Apr 30, 2024 | Feb 15, 2024 | Nov 1, 2023 | ||||||||||||||||||||||||
CONTRACT BACKLOG (1) | |||||||||||||||||||||||||||||
| Owned Rigs | $ | 1,236.9 | $ | 1,322.9 | $ | 1,398.9 | $ | 1,475.4 | $ | 1,547.0 | |||||||||||||||||||
Leased Rigs (2) | 344.4 | 510.4 | 583.3 | 662.7 | 743.7 | ||||||||||||||||||||||||
| Total | $ | 1,581.3 | $ | 1,833.3 | $ | 1,982.2 | $ | 2,138.1 | $ | 2,290.7 | |||||||||||||||||||
(1)Contract drilling backlog reflects commitments, represented by signed drilling contracts, and is calculated by multiplying the contracted day rate by the contract period. The contracted day rate excludes certain types of lump sum fees for rig mobilization, demobilization, contract preparation, as well as customer reimbursables and bonus opportunities.
(2)Leased rigs backlog as of July 29, 2024, included approximately $113 million related to the drilling contracts for VALARIS 147 and VALARIS 148, which previously received suspension notices from Saudi Aramco. The contracts were subsequently terminated and are no longer included in leased rigs backlog as of October 30, 2024.
| Three Months Ended | |||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
AVERAGE DAILY REVENUE (1) | |||||||||||||||||||||||||||||
| Owned Rigs | $ | 109,000 | $ | 104,000 | $ | 105,000 | $ | 100,000 | $ | 91,000 | |||||||||||||||||||
Leased Rigs (2) | 98,000 | 101,000 | 99,000 | 97,000 | 98,000 | ||||||||||||||||||||||||
| Total | $ | 103,000 | $ | 102,000 | $ | 102,000 | $ | 98,000 | $ | 95,000 | |||||||||||||||||||
UTILIZATION (3) | |||||||||||||||||||||||||||||
| Owned Rigs | 62 | % | 77 | % | 91 | % | 96 | % | 91 | % | |||||||||||||||||||
Leased Rigs (2) | 71 | % | 86 | % | 93 | % | 94 | % | 95 | % | |||||||||||||||||||
| Total | 66 | % | 82 | % | 92 | % | 95 | % | 93 | % | |||||||||||||||||||
REVENUE EFFICIENCY (4) | |||||||||||||||||||||||||||||
| Owned Rigs | 70 | % | 90 | % | 98 | % | 94 | % | 99 | % | |||||||||||||||||||
Leased Rigs (2) | 70 | % | 91 | % | 99 | % | 98 | % | 97 | % | |||||||||||||||||||
| Total | 70 | % | 91 | % | 98 | % | 96 | % | 98 | % | |||||||||||||||||||
NUMBER OF RIGS (AT QUARTER END) | |||||||||||||||||||||||||||||
| Owned Rigs | 9 | 9 | 8 | 8 | 7 | ||||||||||||||||||||||||
Leased Rigs (2) | 9 | 9 | 9 | 8 | 8 | ||||||||||||||||||||||||
| Total | 18 | 18 | 17 | 16 | 15 | ||||||||||||||||||||||||
AVAILABLE DAYS (5) | |||||||||||||||||||||||||||||
| Owned Rigs | 828 | 728 | 728 | 695 | 644 | ||||||||||||||||||||||||
Leased Rigs (2) | 828 | 765 | 744 | 736 | 736 | ||||||||||||||||||||||||
| Total | 1,656 | 1,493 | 1,472 | 1,431 | 1,380 | ||||||||||||||||||||||||
OPERATING DAYS (6) | |||||||||||||||||||||||||||||
| Owned Rigs | 510 | 561 | 664 | 668 | 585 | ||||||||||||||||||||||||
Leased Rigs (2) | 590 | 657 | 692 | 691 | 697 | ||||||||||||||||||||||||
| Total | 1,100 | 1,218 | 1,356 | 1,359 | 1,282 | ||||||||||||||||||||||||
(1)Average daily revenue is derived by dividing contract drilling revenues, adjusted to exclude certain types of non-recurring reimbursable revenues, revenues earned during suspension periods, revenues attributable to amortization of drilling contract intangibles and lump-sum revenues and amortization thereof, by the aggregate number of operating days.
(2)All ARO leased rigs are leased from Valaris.
(3)Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the rig fleet.
(4)Revenue efficiency is day rate revenue earned as a percentage of maximum potential day rate revenue.
(5)Represents the maximum number of days available in the period for the rig fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, irrespective of asset status.
(6)Represents the total number of days under contract in the period. Days under contract equals the total number of days that rigs have earned and recognized day rate revenue, including days associated with early contract terminations, compensated downtime and mobilizations. When revenue is deferred and amortized over a future period, for example when we receive fees while mobilizing to commence a new contract or while being upgraded in a shipyard, the related days are excluded from days under contract.
24
Non-GAAP Financial Measures (Unaudited)
To supplement Valaris’ condensed consolidated financial statements presented on a GAAP basis, this press release provides investors with Adjusted EBITDA, Adjusted EBITDAR and Free Cash Flow, which are non-GAAP measures.
Valaris defines "Adjusted EBITDA" as net income (loss) before income tax expense, interest expense, other (income) expense, depreciation expense, amortization, and equity in (earnings) losses of ARO. Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of our core operating performance and makes it easier to compare our results with those of other companies within our industry. Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities, or (c) as a measure of liquidity. Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies.
Valaris defines "Adjusted EBITDAR" as Adjusted EBITDA before reactivation costs. Adjusted EBITDAR is a non-GAAP measure that our management uses to assess the performance of our fleet excluding one-time rig reactivation costs. We believe that this measure is useful to investors and analysts in allowing for greater transparency of our core operating performance. Adjusted EBITDAR should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities, or (c) as a measure of liquidity. Adjusted EBITDAR may not be comparable to other similarly titled measures reported by other companies.
Valaris defines "ARO Adjusted EBITDA" as ARO's net income (loss) before income tax expense, other expense, net, depreciation expense and loss on impairment. ARO Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of ARO's core operating performance and to evaluate ARO's long-term financial performance against that of ARO's peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of ARO's core operating performance and makes it easier to compare ARO's results with those of other companies within ARO's industry. ARO Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities, or (c) as a measure of liquidity. ARO Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies.
The Company is not able to provide a reconciliation of the Company's forward-looking Adjusted EBITDA, as discussed on its third quarter 2024 earnings conference call, to the most directly comparable GAAP measure without unreasonable effort because of the inherent difficulty in forecasting and quantifying certain amounts necessary for such a reconciliation, including forward-looking tax expense and other income (expense).
Valaris defines "Free Cash Flow" as net cash provided by operating activities less capital expenditures. Free Cash Flow is a non-GAAP measure that our management uses to assess the cash generation of our fleet after paying operating expenses and capital expenditures to maintain and upgrade our assets. We believe that this measure is useful to investors and analysts in allowing for greater transparency of the cash generation of our business.
Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, financial measures prepared in accordance with GAAP.
25
Reconciliation of Net Income (Loss) to Adjusted EBITDA
A reconciliation of net income as reported to Adjusted EBITDA is included in the tables below (in millions):
| Three Months Ended | |||||||||||
| Sep 30, 2024 | Jun 30, 2024 | ||||||||||
| VALARIS | |||||||||||
| Net income | $ | 62.9 | $ | 150.8 | |||||||
| Add (subtract): | |||||||||||
| Income tax expense (benefit) | 24.3 | (30.0) | |||||||||
| Interest expense, net | 22.4 | 22.6 | |||||||||
| Other income | (14.7) | (34.5) | |||||||||
| Operating income | $ | 94.9 | $ | 108.9 | |||||||
| Add: | |||||||||||
| Depreciation expense | 31.7 | 29.7 | |||||||||
| Equity in losses of ARO | 23.8 | 0.3 | |||||||||
Adjusted EBITDA | $ | 150.4 | $ | 138.9 | |||||||
A reconciliation of net loss as reported to ARO Adjusted EBITDA is included in the tables below (in millions):
| Three Months Ended | |||||||||||
| Sep 30, 2024 | Jun 30, 2024 | ||||||||||
| ARO | |||||||||||
| Net loss | $ | (54.0) | $ | (6.7) | |||||||
| Add (subtract): | |||||||||||
| Income tax expense (benefit) | 4.2 | (1.8) | |||||||||
| Other expense, net | 15.3 | 13.4 | |||||||||
| Operating income (loss) | $ | (34.5) | $ | 4.9 | |||||||
| Add: | |||||||||||
| Depreciation expense | 21.1 | 19.7 | |||||||||
Loss on impairment | 28.4 | — | |||||||||
ARO Adjusted EBITDA | $ | 15.0 | $ | 24.6 | |||||||
26
Reconciliation of Net Income to Adjusted EBITDA and Adjusted EBITDAR
| (In millions) | Three Months Ended | ||||||||||
| Sep 30, 2024 | Jun 30, 2024 | ||||||||||
| FLOATERS | |||||||||||
| Net income | $ | 126.8 | $ | 114.1 | |||||||
| Subtract: | |||||||||||
| Other income | (0.3) | (1.7) | |||||||||
| Operating income | $ | 126.5 | $ | 112.4 | |||||||
| Add (subtract): | |||||||||||
| Depreciation | 14.8 | 14.1 | |||||||||
| Other costs | — | (0.1) | |||||||||
Adjusted EBITDA (1) | $ | 141.3 | $ | 126.4 | |||||||
| Add: | |||||||||||
| Reactivation costs | 1.9 | 10.9 | |||||||||
Adjusted EBITDAR (1) | $ | 143.2 | $ | 137.3 | |||||||
| JACKUPS | |||||||||||
| Net income | $ | 45.7 | $ | 52.8 | |||||||
| Subtract: | |||||||||||
| Other income | (0.1) | (1.1) | |||||||||
| Operating income | $ | 45.6 | $ | 51.7 | |||||||
| Add: | |||||||||||
| Depreciation | 11.4 | 10.9 | |||||||||
Adjusted EBITDA (1) | $ | 57.0 | $ | 62.6 | |||||||
Adjusted EBITDAR (1) | $ | 57.0 | $ | 62.6 | |||||||
| OTHER | |||||||||||
| Net income | $ | 16.3 | $ | 18.3 | |||||||
| Add (subtract): | |||||||||||
| Other income | (0.9) | — | |||||||||
| Operating income | $ | 15.4 | $ | 18.3 | |||||||
| Add: | |||||||||||
| Depreciation | 2.9 | 2.5 | |||||||||
Adjusted EBITDA (1) | $ | 18.3 | $ | 20.8 | |||||||
Adjusted EBITDAR (1) | $ | 18.3 | $ | 20.8 | |||||||
(1)Adjusted EBITDA and EBITDAR excludes onshore support costs and general and administrative expense.
27
Reconciliation of Net Income (Loss) to Adjusted EBITDAR
| (In millions) | Three Months Ended | ||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
ACTIVE FLEET (1) | |||||||||||||||||||||||||||||
| Net income | $ | 186.8 | $ | 186.6 | $ | 80.8 | $ | 78.7 | $ | 57.5 | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | (0.4) | (2.8) | (7.0) | (3.3) | (1.0) | ||||||||||||||||||||||||
| Operating income | $ | 186.4 | $ | 183.8 | $ | 73.8 | $ | 75.4 | $ | 56.5 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
| Reactivation costs | 1.9 | 10.9 | 30.3 | 38.5 | 50.9 | ||||||||||||||||||||||||
Depreciation | 24.8 | 23.5 | 22.2 | 23.5 | 21.9 | ||||||||||||||||||||||||
Other | — | (0.1) | — | 0.1 | — | ||||||||||||||||||||||||
Adjusted EBITDAR (2) | $ | 213.1 | $ | 218.1 | $ | 126.3 | $ | 137.5 | $ | 129.3 | |||||||||||||||||||
LEASED AND MANAGED RIGS | |||||||||||||||||||||||||||||
| Net income | $ | 16.3 | $ | 18.3 | $ | 24.8 | $ | 22.1 | $ | 25.8 | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | (0.9) | — | — | — | — | ||||||||||||||||||||||||
| Operating income | $ | 15.4 | $ | 18.3 | $ | 24.8 | $ | 22.1 | $ | 25.8 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
Depreciation | 2.9 | 2.5 | 1.3 | 1.2 | 1.3 | ||||||||||||||||||||||||
Other | — | — | — | (0.1) | 0.1 | ||||||||||||||||||||||||
Adjusted EBITDAR (2) | $ | 18.3 | $ | 20.8 | $ | 26.1 | $ | 23.2 | $ | 27.2 | |||||||||||||||||||
STACKED FLEET | |||||||||||||||||||||||||||||
| Net loss | $ | (14.3) | $ | (19.7) | $ | (7.9) | $ | (8.3) | $ | (8.6) | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | — | — | (0.1) | (0.1) | — | ||||||||||||||||||||||||
| Operating loss | $ | (14.3) | $ | (19.7) | $ | (8.0) | $ | (8.4) | $ | (8.6) | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
Depreciation | 1.4 | 1.5 | 1.4 | 2.7 | 2.5 | ||||||||||||||||||||||||
Other | — | — | — | (0.1) | 0.1 | ||||||||||||||||||||||||
Adjusted EBITDAR (2) | $ | (12.9) | $ | (18.2) | $ | (6.6) | $ | (5.8) | $ | (6.0) | |||||||||||||||||||
TOTAL FLEET | |||||||||||||||||||||||||||||
| Net income | $ | 188.8 | $ | 185.2 | $ | 97.7 | $ | 92.5 | $ | 74.7 | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | (1.3) | (2.8) | (7.1) | (3.4) | (1.0) | ||||||||||||||||||||||||
| Operating income | $ | 187.5 | $ | 182.4 | $ | 90.6 | $ | 89.1 | $ | 73.7 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
| Reactivation costs | 1.9 | 10.9 | 30.3 | 38.5 | 50.9 | ||||||||||||||||||||||||
Depreciation | 29.1 | 27.5 | 24.9 | 27.4 | 25.7 | ||||||||||||||||||||||||
Other | — | (0.1) | — | (0.1) | 0.2 | ||||||||||||||||||||||||
Adjusted EBITDAR (2) | $ | 218.5 | $ | 220.7 | $ | 145.8 | $ | 154.9 | $ | 150.5 | |||||||||||||||||||
(1)Active fleet represents rigs that are not preservation stacked and includes rigs that are in the process of being reactivated.
(2)Adjusted EBITDAR for active fleet, leased and managed rigs and stacked fleet excludes onshore support costs and general and administrative expense.
28
Reconciliation of Net Income (Loss) to Adjusted EBITDA
| (In millions) | Three Months Ended | ||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
DRILLSHIPS | |||||||||||||||||||||||||||||
| Net income (loss) | $ | 117.3 | $ | 79.6 | $ | 49.4 | $ | 4.7 | $ | (9.9) | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | (0.3) | (1.5) | (6.2) | (2.0) | (0.6) | ||||||||||||||||||||||||
| Operating income (loss) | $ | 117.0 | $ | 78.1 | $ | 43.2 | $ | 2.7 | $ | (10.5) | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
Depreciation | 13.9 | 13.2 | 12.4 | 14.0 | 13.2 | ||||||||||||||||||||||||
| Other | — | (0.1) | — | — | 0.1 | ||||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 130.9 | $ | 91.2 | $ | 55.6 | $ | 16.7 | $ | 2.8 | |||||||||||||||||||
SEMISUBMERSIBLES | |||||||||||||||||||||||||||||
| Net income | $ | 9.5 | $ | 34.5 | $ | 14.7 | $ | 19.6 | $ | 24.4 | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | — | (0.2) | (0.1) | (0.1) | — | ||||||||||||||||||||||||
| Operating income | $ | 9.5 | $ | 34.3 | $ | 14.6 | $ | 19.5 | $ | 24.4 | |||||||||||||||||||
| Add: | |||||||||||||||||||||||||||||
| Depreciation | 0.9 | 0.9 | 0.8 | 1.0 | 1.0 | ||||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 10.4 | $ | 35.2 | $ | 15.4 | $ | 20.5 | $ | 25.4 | |||||||||||||||||||
(1)Adjusted EBITDA for asset category excludes onshore support costs and general and administrative expense.
29
Reconciliation of Net Income to Adjusted EBITDA
| (In millions) | Three Months Ended | ||||||||||||||||||||||||||||
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | |||||||||||||||||||||||||
HD HARSH ENVIRONMENT | |||||||||||||||||||||||||||||
| Net income | $ | 24.8 | $ | 31.0 | $ | 0.4 | $ | 15.4 | $ | 15.4 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
| Other (income) expense | 0.2 | (0.3) | (0.3) | (0.1) | (0.2) | ||||||||||||||||||||||||
| Operating income | $ | 25.0 | $ | 30.7 | $ | 0.1 | $ | 15.3 | $ | 15.2 | |||||||||||||||||||
| Add: | |||||||||||||||||||||||||||||
Depreciation | 6.4 | 5.6 | 5.3 | 5.8 | 5.7 | ||||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 31.4 | $ | 36.3 | $ | 5.4 | $ | 21.1 | $ | 20.9 | |||||||||||||||||||
HD & SD MODERN JACKUPS | |||||||||||||||||||||||||||||
| Net income | $ | 17.6 | $ | 19.2 | $ | 6.4 | $ | 28.2 | $ | 17.7 | |||||||||||||||||||
| Subtract: | |||||||||||||||||||||||||||||
| Other income | (0.2) | (0.8) | (0.6) | (1.2) | (0.2) | ||||||||||||||||||||||||
| Operating income | $ | 17.4 | $ | 18.4 | $ | 5.8 | $ | 27.0 | $ | 17.5 | |||||||||||||||||||
| Add: | |||||||||||||||||||||||||||||
Depreciation | 2.6 | 2.9 | 2.8 | 3.0 | 2.9 | ||||||||||||||||||||||||
| Other | — | — | — | 0.1 | — | ||||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 20.0 | $ | 21.3 | $ | 8.6 | $ | 30.1 | $ | 20.4 | |||||||||||||||||||
SD LEGACY JACKUPS | |||||||||||||||||||||||||||||
| Net income | $ | 3.3 | $ | 2.6 | $ | 2.0 | $ | 2.5 | $ | 1.3 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
| Other (income) expense | (0.1) | — | 0.1 | — | — | ||||||||||||||||||||||||
| Operating income | $ | 3.2 | $ | 2.6 | $ | 2.1 | $ | 2.5 | $ | 1.3 | |||||||||||||||||||
| Add (subtract): | |||||||||||||||||||||||||||||
Depreciation | 2.4 | 2.4 | 2.3 | 2.4 | 1.6 | ||||||||||||||||||||||||
| Other | — | — | — | (0.1) | — | ||||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 5.6 | $ | 5.0 | $ | 4.4 | $ | 4.8 | $ | 2.9 | |||||||||||||||||||
(1)Adjusted EBITDA for asset category excludes onshore support costs and general and administrative expense.
30
Reconciliation of Cash from Operating Activities to Free Cash Flow
| (In millions) | Three Months Ended | ||||||||||
| Sep 30, 2024 | Jun 30, 2024 | ||||||||||
| Net cash provided by operating activities | $ | 193.0 | $ | 11.5 | |||||||
| Additions to property and equipment | (81.9) | (110.2) | |||||||||
Free cash flow | $ | 111.1 | $ | (98.7) | |||||||
31