Valaris Limited (NYSE: VAL) ("Valaris" or the "Company") today
reported second quarter 2023 results.
President and Chief Executive Officer Anton Dibowitz said, “In
the second quarter, we continued to deliver strong operational
performance, achieving revenue efficiency of 97%. We also mobilized
the VALARIS DS-17 to Brazil, which has completed its reactivation
and is expected to commence its contract this month.”
Dibowitz added, “Our outlook for the industry and our business
remains very positive, with increasing demand and constrained
supply tightening the market. We continue to see increases in
contract duration, lead times and day rates, all of which point
towards a strong and sustained upcycle. Our earnings and cash flow
should grow meaningfully over the next few years as rigs roll from
legacy day rate contracts to higher market rates and reactivated
rigs return to work on attractive contracts.”
Dibowitz concluded, “Moving forward, we will continue to be
disciplined in exercising our operational leverage and
laser-focused on maximizing long-term shareholder value. This
includes our commitment to returning capital to shareholders, as
demonstrated by our recently announced increase in our 2023 share
repurchase target from $150 million to $200 million.”
Financial and Operational Highlights
- Net loss of $27 million, Adjusted EBITDA of $15 million and
Adjusted EBITDAR of $59 million;
- Delivered revenue efficiency of 97%;
- Awarded new contracts and extensions with associated contract
backlog of approximately $180 million during the second
quarter;
- Long-term contract awarded to VALARIS DS-7 following quarter
end, increasing total contract backlog to $3.0 billion;
- Increased 2023 share repurchase target from $150 million to
$200 million in conjunction with the VALARIS DS-7 contract
award;
- Repurchased $65 million of shares through June 30, 2023 and $94
million to date.
Second Quarter Review
Net loss was $27 million compared to net income of $49 million
in the first quarter 2023. Adjusted EBITDA decreased to $15 million
from $29 million in the first quarter primarily due to higher
reactivation expense. Adjusted EBITDAR increased to $59 million
from $55 million in the first quarter.
Revenues decreased to $415 million from $430 million in the
first quarter 2023. Excluding reimbursable items, revenues
decreased to $390 million from $408 million in the first quarter.
The decrease was primarily due to fewer operating days for the
jackup fleet and lower mobilization and demobilization revenues.
These were partially offset by an increase in the average day rate
for both floaters and jackups.
Contract drilling expense decreased to $374 million from $377
million in the first quarter 2023. Excluding reimbursable items,
contract drilling expense decreased to $348 million from $356
million in the first quarter primarily due to lower costs for rigs
that were idle or between contracts in the second quarter, and
lower repair and maintenance costs associated with special periodic
surveys and contract preparation work. These were partially offset
by higher reactivation costs, which increased to $44 million from
$26 million.
Depreciation expense increased to $25 million from $23 million
in the first quarter 2023. General and administrative expense
increased to $26 million from $24 million in the first quarter 2023
primarily due to higher personnel costs.
Other income decreased to $7 million from $13 million in the
first quarter 2023. This was primarily due to a $29 million loss
recognized on the extinguishment of the Senior Secured First Lien
Notes due 2028 and a $6 million increase in interest expense
associated with the refinancing transaction. These were partially
offset by a $27 million pre-tax gain recognized in the second
quarter on the sale of VALARIS 54.
Tax expense was $25 million compared to a tax benefit of $28
million in the first quarter 2023. The second quarter tax provision
included $6 million of discrete tax expense and the first quarter
tax provision included $44 million of discrete tax benefit, which
were primarily attributable to changes in liabilities for
unrecognized tax benefits associated with tax positions taken in
prior years. Adjusted for discrete items, tax expense increased to
$18 million from $16 million in the first quarter.
Cash and cash equivalents and restricted cash decreased to $805
million as of June 30, 2023, from $844 million as of March 31,
2023. The decrease was primarily due to payments for share
repurchases, net capital expenditures and an increase in working
capital, partially offset by net proceeds from the refinancing
transaction completed during the quarter.
Capital expenditures increased to $71 million from $56 million
in the first quarter 2023 primarily due to an increase in fleetwide
maintenance capital expenditures and reactivation capital
expenditures associated with VALARIS DS-8.
Second Quarter Segment Review
Floaters
Floater revenues increased to $227 million from $215 million in
the first quarter 2023. Excluding reimbursable items, revenues
increased to $216 million from $207 million in the first quarter.
The increase was primarily due to more operating days and a higher
average day rate for VALARIS DS-12, which commenced a new contract
in the second quarter after spending part of the first quarter
mobilizing from Mauritania to Angola.
Contract drilling expense increased to $196 million from $175
million in the first quarter 2023. Excluding reimbursable items,
contract drilling expense increased to $185 million from $166
million in the first quarter. The increase was primarily due to
higher reactivation costs, which increased to $44 million from $26
million in the first quarter due to the commencement of a
reactivation project for VALARIS DS-8 ahead of a three-year
contract offshore Brazil. This was partially offset by lower
reactivation expense for VALARIS DS-17, which is expected to
commence operations offshore Brazil this month.
Jackups
Jackup revenues decreased to $145 million from $170 million in
the first quarter 2023. Excluding reimbursable items, revenues
decreased to $136 million from $162 million in the first quarter
primarily due to fewer operating days and lower mobilization and
demobilization revenues for VALARIS 249, which completed its
contract offshore New Zealand late in the first quarter and was
mobilizing to its next contract offshore Trinidad during the second
quarter. In addition, VALARIS 54 was sold following the completion
of its contract late in the first quarter and VALARIS 108 was idle
for most of the second quarter undergoing contract preparation work
ahead of a three-year bareboat charter with ARO Drilling. These
were partially offset by more operating days for VALARIS 115 and
247 as both rigs commenced new contracts after idle periods.
Contract drilling expense decreased to $124 million from $149
million in the first quarter 2023. Excluding reimbursable items,
contract drilling expense decreased to $114 million from $142
million in the first quarter. This was primarily due to lower costs
for VALARIS 249 as the rig's operating costs were deferred during
its mobilization from New Zealand to Trinidad, lower costs for
VALARIS Viking due to the rig being preservation stacked in the
first quarter and lower costs associated with special periodic
surveys and contract preparations for certain rigs.
ARO Drilling
Revenues decreased to $118 million from $124 million in the
first quarter 2023 primarily due to an increase in out of service
time related to planned maintenance on certain rigs. Contract
drilling expense increased to $95 million from $91 million in the
first quarter primarily due to higher repair costs associated with
the previously mentioned planned maintenance.
Other
Revenues decreased to $43 million from $46 million in the first
quarter 2023 and contract drilling expense decreased to $18 million
from $20 million in the first quarter.
Second Quarter
Floaters
Jackups
ARO (1)
Other
Reconciling Items (1)(2)
Consolidated Total
(in millions of $, except %)
Q2 2023
Q1 2023
Chg
Q2 2023
Q1 2023
Chg
Q2 2023
Q1 2023
Chg
Q2 2023
Q1 2023
Chg
Q2 2023
Q1 2023
Q2 2023
Q1 2023
Chg
Revenues
227.4
214.8
6
%
144.6
169.8
(15
)%
117.8
123.6
(5
)%
43.2
45.5
(5
)%
(117.8
)
(123.6
)
415.2
430.1
(3
)%
Operating expenses
Contract drilling
196.2
174.6
(12
)%
123.5
148.9
17
%
95.0
90.9
(5
)%
18.2
20.2
10
%
(59.4
)
(57.4
)
373.5
377.2
1
%
Depreciation
13.6
13.0
(5
)%
9.6
9.0
(7
)%
15.6
15.0
(4
)%
1.2
1.3
8
%
(15.5
)
(15.0
)
24.5
23.3
(5
)%
General and admin.
—
—
—
%
—
—
—
%
5.7
4.6
(24
)%
—
—
—
%
20.7
19.8
26.4
24.4
(8
)%
Equity in earnings (losses) of ARO
—
—
—
%
—
—
—
%
—
—
—
%
—
—
—
%
(0.7
)
3.3
(0.7
)
3.3
nm
Operating income (loss)
17.6
27.2
(35
)%
11.5
11.9
(3
)%
1.5
13.1
(89
)%
23.8
24.0
(1
)%
(64.3
)
(67.7
)
(9.9
)
8.5
nm
Net income (loss)
17.9
27.5
(35
)%
39.1
12.1
223
%
(7.3
)
0.8
nm
23.8
24.0
(1
)%
(100.8
)
(15.8
)
(27.3
)
48.6
nm
Adjusted EBITDA
31.1
40.2
(23
)%
21.1
20.8
1
%
17.1
28.1
(39
)%
24.9
25.4
(2
)%
(78.9
)
(86.0
)
15.3
28.5
(46
)%
Adjusted EBITDAR
75.3
66.4
13
%
21.0
20.9
—
%
17.1
28.1
(39
)%
24.9
25.4
(2
)%
(78.9
)
(86.0
)
59.4
54.8
8
%
(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."
Adjusted EBITDA and Adjusted EBITDAR
In the second quarter, Valaris changed its Adjusted EBITDA and
Adjusted EBITDAR calculations to include amortization associated
with deferred mobilization and contract preparation revenues and
costs and deferred capital upgrade revenues. The Company believes
that this change will ensure that Adjusted EBITDA and Adjusted
EBITDAR better reflect the earnings profile of our operations and
will be more closely aligned with the calculation methodology used
by Valaris' closest offshore drilling peers. Adjusted EBITDA and
Adjusted EBITDAR for all comparative periods have been revised
using the new methodology to consistently reflect this change. The
impact of the calculation change on both Adjusted EBITDA and
Adjusted EBITDAR was negative $2 million and positive $4 million in
the second and first quarter 2023, respectively.
As previously announced, Valaris will hold its second quarter
2023 earnings conference call at 9:00 a.m. CT (10:00 a.m. ET) on
Wednesday, August 2, 2023. An updated investor presentation will be
available on the Valaris website after the call.
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, 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 (such
as the ongoing conflict in Ukraine); cybersecurity attacks and
threats; impacts and effects of public health crises, pandemics and
epidemics, such as the COVID-19 pandemic; future operations; any
exercise of our options for delivery of the VALARIS DS-13 and
VALARIS DS-14; increasing regulatory complexity; targets, progress,
plans and goals related to environmental, social and governance
(“ESG”) 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 ESG targets, including our Scope 1 emissions
intensity reduction target, 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; 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.
VALARIS LIMITED AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In millions, except per share
amounts)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
OPERATING REVENUES
$
415.2
$
430.1
$
433.6
$
437.2
$
413.3
OPERATING EXPENSES
Contract drilling (exclusive of
depreciation)
373.5
377.2
353.4
336.7
361.8
Loss on impairment
—
—
—
—
34.5
Depreciation
24.5
23.3
23.8
22.6
22.3
General and administrative
26.4
24.4
23.9
19.2
19.0
Total operating expenses
424.4
424.9
401.1
378.5
437.6
EQUITY IN EARNINGS (LOSSES) OF ARO
(0.7
)
3.3
8.6
2.9
8.7
OPERATING INCOME (LOSS)
(9.9
)
8.5
41.1
61.6
(15.6
)
OTHER INCOME (EXPENSE)
Interest income
24.6
23.0
15.5
27.9
11.2
Interest expense, net
(16.7
)
(11.1
)
(10.5
)
(11.7
)
(11.6
)
Other, net
(0.8
)
0.6
(5.2
)
13.7
149.0
7.1
12.5
(0.2
)
29.9
148.6
INCOME (LOSS) BEFORE INCOME TAXES
(2.8
)
21.0
40.9
91.5
133.0
PROVISION (BENEFIT) FOR INCOME TAXES
24.5
(27.6
)
9.8
13.8
20.2
NET INCOME (LOSS)
(27.3
)
48.6
31.1
77.7
112.8
NET INCOME ATTRIBUTABLE TO NONCONTROLLING
INTERESTS
(2.1
)
(1.9
)
(1.9
)
(3.4
)
(1.2
)
NET INCOME (LOSS) ATTRIBUTABLE TO
VALARIS
$
(29.4
)
$
46.7
$
29.2
$
74.3
$
111.6
EARNINGS (LOSS) PER SHARE
Basic
$
(0.39
)
$
0.62
$
0.39
$
0.99
$
1.49
Diluted
$
(0.39
)
$
0.61
$
0.38
$
0.98
$
1.48
WEIGHTED-AVERAGE SHARES OUTSTANDING
Basic
74.8
75.2
75.2
75.1
75.0
Diluted
74.8
76.4
76.0
75.6
75.6
VALARIS LIMITED AND
SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(In millions)
As of
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$
787.3
$
822.5
$
724.1
$
406.0
$
553.5
Restricted cash
18.0
21.5
24.4
18.2
23.8
Short-term investments
—
—
—
220.0
—
Accounts receivable, net
473.4
393.4
449.1
535.5
544.6
Other current assets
168.7
158.1
148.6
162.9
159.0
Total current assets
$
1,447.4
$
1,395.5
$
1,346.2
$
1,342.6
$
1,280.9
PROPERTY AND EQUIPMENT, NET
1,073.7
1,015.5
977.2
953.6
931.7
LONG-TERM NOTES RECEIVABLE FROM ARO
268.0
261.0
254.0
246.9
264.5
INVESTMENT IN ARO
113.7
114.4
111.1
102.6
99.6
OTHER ASSETS
185.6
164.8
171.8
175.5
184.1
$
3,088.4
$
2,951.2
$
2,860.3
$
2,821.2
$
2,760.8
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable - trade
$
364.2
$
324.1
$
256.5
$
256.6
$
287.0
Accrued liabilities and other
294.7
267.7
247.9
262.5
260.1
Total current liabilities
$
658.9
$
591.8
$
504.4
$
519.1
$
547.1
LONG-TERM DEBT
681.9
542.8
542.4
541.8
545.7
OTHER LIABILITIES
481.5
464.6
515.6
523.2
511.0
TOTAL LIABILITIES
1,822.3
1,599.2
1,562.4
1,584.1
1,603.8
TOTAL EQUITY
1,266.1
1,352.0
1,297.9
1,237.1
1,157.0
$
3,088.4
$
2,951.2
$
2,860.3
$
2,821.2
$
2,760.8
VALARIS LIMITED AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In millions)
Six Months Ended June 30,
2023
2022
OPERATING ACTIVITIES
Net income
$
21.3
$
73.0
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation expense
47.8
44.8
Amortization
—
4.0
Loss on extinguishment of debt
29.2
—
Gain on asset disposals
(27.9
)
(137.6
)
Accretion of discount on notes receivable
from ARO
(14.0
)
(15.4
)
Share-based compensation expense
12.7
6.9
Deferred income tax expense
7.1
6.7
Equity in earnings of ARO
(2.6
)
(13.0
)
Net periodic pension and retiree medical
income
(0.2
)
(8.1
)
Loss on impairment
—
34.5
Other
2.7
1.2
Changes in contract liabilities
(7.5
)
20.9
Changes in deferred costs
(6.9
)
(49.5
)
Changes in other operating assets and
liabilities
60.9
(82.4
)
Net cash provided by (used in) operating
activities
$
122.6
$
(114.0
)
INVESTING ACTIVITIES
Additions to property and equipment
$
(127.3
)
$
(99.6
)
Net proceeds from disposition of
assets
29.1
146.5
Net cash provided by (used in) investing
activities
$
(98.2
)
$
46.9
FINANCING ACTIVITIES
Issuance of Second Lien Notes
$
700.0
$
—
Redemption of First Lien Notes
(571.8
)
—
Payments for share repurchases
(64.4
)
—
Debt issuance costs
(31.0
)
—
Other
(0.4
)
(0.2
)
Net cash provided by (used in) financing
activities
$
32.4
$
(0.2
)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS AND RESTRICTED CASH
$
56.8
$
(67.3
)
CASH AND CASH EQUIVALENTS AND RESTRICTED
CASH, BEGINNING OF PERIOD
748.5
644.6
CASH AND CASH EQUIVALENTS AND RESTRICTED
CASH, END OF PERIOD
$
805.3
$
577.3
VALARIS LIMITED AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
OPERATING ACTIVITIES
Net income (loss)
$
(27.3
)
$
48.6
$
31.1
$
77.7
$
112.8
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Loss on extinguishment of debt
29.2
—
—
—
—
Gain on asset disposals
(27.8
)
(0.1
)
(3.5
)
(0.1
)
(135.1
)
Depreciation expense
24.5
23.3
23.8
22.6
22.3
Amortization
—
—
2.0
2.1
2.0
Accretion of discount on notes receivable
from ARO
(7.0
)
(7.0
)
(7.1
)
(22.4
)
(7.7
)
Share-based compensation expense
7.0
5.7
5.9
4.6
3.5
Deferred income tax expense
2.5
4.6
0.8
0.4
7.3
Equity in losses (earnings) of ARO
0.7
(3.3
)
(8.6
)
(2.9
)
(8.7
)
Net periodic pension and retiree medical
income
(0.1
)
(0.1
)
(4.3
)
(4.0
)
(4.1
)
Loss on impairment
—
—
—
—
34.5
Other
2.2
0.5
(1.6
)
0.3
0.7
Changes in contract liabilities
13.3
(20.8
)
3.6
38.0
11.4
Changes in deferred costs
(7.4
)
0.5
8.8
1.8
(39.4
)
Changes in other operating assets and
liabilities
(38.9
)
99.8
103.8
(31.8
)
(114.3
)
Net cash provided by (used in) operating
activities
$
(29.1
)
$
151.7
$
154.7
$
86.3
$
(114.8
)
INVESTING ACTIVITIES
Additions to property and equipment
$
(71.0
)
$
(56.3
)
$
(53.9
)
$
(53.5
)
$
(61.1
)
Net proceeds from disposition of
assets
29.0
0.1
3.5
0.3
145.2
Purchases of short-term investments
—
—
—
(220.0
)
—
Maturities of short-term investments
—
—
220.0
—
—
Repayments of note receivable from ARO
—
—
—
40.0
—
Net cash provided by (used in) investing
activities
$
(42.0
)
$
(56.2
)
$
169.6
$
(233.2
)
$
84.1
FINANCING ACTIVITIES
Issuance of Second Lien Notes
$
700.0
$
—
$
—
$
—
$
—
Redemption of First Lien Notes
(571.8
)
—
—
—
—
Payments for share repurchases
(64.4
)
—
—
—
—
Debt issuance costs
(31.0
)
—
—
(3.9
)
—
Other
(0.4
)
—
—
(2.3
)
(0.2
)
Net cash provided by (used in) financing
activities
$
32.4
$
—
$
—
$
(6.2
)
$
(0.2
)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS AND RESTRICTED CASH
$
(38.7
)
$
95.5
$
324.3
$
(153.1
)
$
(30.9
)
CASH AND CASH EQUIVALENTS AND RESTRICTED
CASH, BEGINNING OF PERIOD
844.0
748.5
424.2
577.3
608.2
CASH AND CASH EQUIVALENTS AND RESTRICTED
CASH, END OF PERIOD
$
805.3
$
844.0
$
748.5
$
424.2
$
577.3
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
REVENUES
Floaters
Drillships
$
157.7
$
146.5
$
151.9
$
139.8
$
149.0
Semisubmersibles
69.7
68.3
59.1
61.9
39.1
$
227.4
$
214.8
$
211.0
$
201.7
$
188.1
Jackups
(1)
HD Ultra-Harsh & Harsh Environment
$
56.7
$
75.7
$
98.5
$
123.0
$
106.1
HD & SD Modern
74.2
73.2
62.5
59.0
61.1
SD Legacy
13.7
20.9
20.8
13.9
18.6
$
144.6
$
169.8
$
181.8
$
195.9
$
185.8
Total
$
372.0
$
384.6
$
392.8
$
397.6
$
373.9
Other
Leased and Managed Rigs
$
43.2
$
45.5
$
40.8
$
39.6
$
39.4
Valaris Total
$
415.2
$
430.1
$
433.6
$
437.2
$
413.3
(1) HD = Heavy Duty; SD = Standard Duty.
Heavy duty jackups are well-suited for operations in tropical
revolving storm areas.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ADJUSTED EBITDAR (1)
Active Fleet (2)
$
104.5
$
100.4
$
121.5
$
137.2
$
111.7
Leased and Managed Rigs
24.9
25.4
22.3
22.0
14.9
$
129.4
$
125.8
$
143.8
$
159.2
$
126.6
Stacked Fleet (3)
(8.2
)
(13.1
)
(8.1
)
(8.5
)
(19.0
)
$
121.2
$
112.7
$
135.7
$
150.7
$
107.6
Support costs
General and administrative expense
$
26.4
$
24.4
$
23.9
$
19.2
$
19.0
Onshore support costs
35.4
33.5
32.8
30.2
29.7
$
61.8
$
57.9
$
56.7
$
49.4
$
48.7
Valaris Total
$
59.4
$
54.8
$
79.0
$
101.3
$
58.9
Reactivation costs (4)
$
44.1
$
26.3
$
20.7
$
17.8
$
24.3
(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. Starting from the second quarter 2023,
our Adjusted EBITDAR calculation was changed to include
amortization associated with deferred mobilization and contract
preparation revenues and costs and deferred capital upgrade
revenues to better reflect the earnings profile of our operations
and more closely align with the calculation methodology used by
Valaris' closest offshore drilling peers. Prior periods were
adjusted to conform with the current period presentation.
(2)
Active fleet represents rigs that
are not preservation stacked and includes rigs that are in the
process of being reactivated.
(3)
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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ADJUSTED EBITDAR (1)
Floaters
Drillships
$
44.4
$
38.2
$
38.8
$
31.2
$
44.3
Semisubmersibles
30.9
28.2
20.4
27.8
2.6
$
75.3
$
66.4
$
59.2
$
59.0
$
46.9
Jackups
HD Ultra-Harsh & Harsh
$
6.1
$
3.1
$
31.4
$
57.0
$
35.5
HD & SD - Modern
11.5
9.4
13.0
10.7
2.5
SD - Legacy
3.4
8.4
9.8
2.0
7.8
$
21.0
$
20.9
$
54.2
$
69.7
$
45.8
Total
$
96.3
$
87.3
$
113.4
$
128.7
$
92.7
Other
Leased and Managed Rigs
$
24.9
$
25.4
$
22.3
$
22.0
$
14.9
Total
$
121.2
$
112.7
$
135.7
$
150.7
$
107.6
Support
costs
General and administrative expense
$
26.4
$
24.4
$
23.9
$
19.2
$
19.0
Onshore support costs
35.4
33.5
32.8
30.2
29.7
$
61.8
$
57.9
$
56.7
$
49.4
$
48.7
Valaris Total
$
59.4
$
54.8
$
79.0
$
101.3
$
58.9
(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. Starting from
the second quarter 2023, our Adjusted EBITDAR calculation was
changed to include amortization associated with deferred
mobilization and contract preparation revenues and costs and
deferred capital upgrade revenues to better reflect the earnings
profile of our operations and more closely align with the
calculation methodology used by Valaris' closest offshore drilling
peers. Prior periods were adjusted to conform with the current
period presentation.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ADJUSTED EBITDA (1)
Floaters
Drillships
$
0.3
$
12.2
$
18.5
$
14.2
$
21.0
Semisubmersibles
30.8
28.0
20.0
27.0
1.9
$
31.1
$
40.2
$
38.5
$
41.2
$
22.9
Jackups
HD Ultra-Harsh & Harsh
$
6.1
$
3.0
$
31.4
$
57.1
$
35.3
HD & SD - Modern
11.6
9.4
13.0
10.6
2.4
SD - Legacy
3.4
8.4
9.8
2.0
7.8
$
21.1
$
20.8
$
54.2
$
69.7
$
45.5
Total
$
52.2
$
61.0
$
92.7
$
110.9
$
68.4
Other
Leased and Managed Rigs
$
24.9
$
25.4
$
22.3
$
22.0
$
14.9
Total
$
77.1
$
86.4
$
115.0
$
132.9
$
83.3
Support
costs
General and administrative expense
$
26.4
$
24.4
$
23.9
$
19.2
$
19.0
Onshore support costs
35.4
33.5
32.8
30.2
29.7
$
61.8
$
57.9
$
56.7
$
49.4
$
48.7
Valaris Total
$
15.3
$
28.5
$
58.3
$
83.5
$
34.6
(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. Starting from the second
quarter 2023, our Adjusted EBITDA calculation was changed to
include amortization associated with deferred mobilization and
contract preparation revenues and costs and deferred capital
upgrade revenues to better reflect the earnings profile of our
operations and more closely align with the calculation methodology
used by Valaris' closest offshore drilling peers. Prior periods
were adjusted to conform with the current period presentation.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
(In millions)
As of
August 1, 2023
May 1, 2023
February 21, 2023
October 31, 2022
July 28, 2022
CONTRACT BACKLOG (1)
Floaters
Drillships
$
1,684.9
$
1,499.0
$
1,062.3
$
995.1
$
1,090.3
Semisubmersibles
272.4
270.2
314.6
379.5
359.6
$
1,957.3
$
1,769.2
$
1,376.9
$
1,374.6
$
1,449.9
Jackups
HD Ultra-Harsh & Harsh
$
307.4
$
277.7
$
348.3
$
185.1
$
192.0
HD & SD - Modern
366.8
317.7
341.1
395.3
377.6
SD - Legacy
118.4
119.7
52.9
82.3
72.3
$
792.6
$
715.1
$
742.3
$
662.7
$
641.9
Total
$
2,749.9
$
2,484.3
$
2,119.2
$
2,037.3
$
2,091.8
Other
Leased and Managed Rigs
$
291.4
$
318.9
$
344.0
$
223.3
$
257.5
Valaris Total
$
3,041.3
$
2,803.2
$
2,463.2
$
2,260.6
$
2,349.3
(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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
AVERAGE DAY RATES (1)
Floaters
Drillships
$
232,000
$
221,000
$
215,000
$
220,000
$
213,000
Semisubmersibles
240,000
246,000
204,000
226,000
214,000
$
235,000
$
228,000
$
212,000
$
222,000
$
213,000
Jackups
HD Ultra-Harsh & Harsh
$
97,000
$
97,000
$
108,000
$
121,000
$
114,000
HD & SD Modern
97,000
92,000
83,000
82,000
79,000
SD Legacy
81,000
76,000
74,000
74,000
74,000
$
95,000
$
91,000
$
93,000
$
100,000
$
94,000
Total
$
149,000
$
139,000
$
133,000
$
138,000
$
120,000
Other
Leased and Managed Rigs
$
41,000
$
43,000
$
36,000
$
38,000
$
39,000
Valaris Total
$
117,000
$
113,000
$
108,000
$
112,000
$
98,000
(1)
Average day rates are derived by
dividing contract drilling revenues, adjusted to exclude certain
types of non-recurring reimbursable revenues, lump-sum revenues,
revenues earned during suspension periods and revenues attributable
to amortization of drilling contract intangibles, by the aggregate
number of contract days, adjusted to exclude contract days
associated with certain suspension periods, mobilizations,
demobilizations and shipyard contracts.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
UTILIZATION - TOTAL FLEET (1)
Floaters
Drillships
58
%
59
%
62
%
54
%
34
%
Semisubmersibles
60
%
57
%
57
%
54
%
37
%
59
%
58
%
60
%
54
%
35
%
Jackups
HD Ultra-Harsh & Harsh
55
%
57
%
77
%
85
%
81
%
HD & SD Modern
52
%
57
%
55
%
53
%
53
%
SD Legacy
78
%
99
%
99
%
67
%
88
%
55
%
62
%
68
%
67
%
67
%
Total
56
%
60
%
65
%
62
%
56
%
Other
Leased and Managed Rigs
100
%
100
%
100
%
100
%
100
%
Valaris Total
65
%
68
%
72
%
69
%
64
%
Pro Forma Jackups (2)
63
%
68
%
73
%
72
%
72
%
(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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
UTILIZATION - ACTIVE FLEET (1)
(2)
Floaters
Drillships
71
%
77
%
85
%
74
%
52
%
Semisubmersibles
100
%
96
%
96
%
91
%
62
%
78
%
82
%
88
%
79
%
55
%
Jackups
HD Ultra-Harsh & Harsh
67
%
67
%
85
%
94
%
89
%
HD & SD Modern
81
%
89
%
86
%
81
%
82
%
SD Legacy
78
%
99
%
99
%
67
%
90
%
74
%
81
%
87
%
85
%
86
%
Total
76
%
81
%
87
%
83
%
77
%
Other
Leased and Managed Rigs
100
%
100
%
100
%
100
%
100
%
Valaris Total
82
%
86
%
90
%
87
%
82
%
Pro Forma Jackups (3)
79
%
83
%
88
%
86
%
87
%
(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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
REVENUE EFFICIENCY (1)
Floaters
Drillships
95
%
97
%
96
%
90
%
95
%
Semisubmersibles
100
%
100
%
100
%
100
%
92
%
96
%
98
%
97
%
93
%
94
%
Jackups
HD Ultra-Harsh & Harsh
99
%
100
%
96
%
99
%
99
%
HD & SD Modern
98
%
100
%
99
%
97
%
98
%
SD Legacy
100
%
99
%
100
%
100
%
100
%
99
%
100
%
98
%
98
%
99
%
Valaris Total
97
%
99
%
98
%
96
%
97
%
(1)
Revenue efficiency is day rate
revenue earned as a percentage of maximum potential day rate
revenue.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
As of
NUMBER OF RIGS
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Active Fleet (1)
Floaters
Drillships
9
9
8
8
8
Semisubmersibles
3
3
3
3
3
12
12
11
11
11
Jackups
HD Ultra-Harsh & Harsh
9
9
10
10
10
HD & SD Modern
9
9
9
9
10
SD Legacy
2
3
3
3
3
20
21
22
22
23
Total Active Fleet
32
33
33
33
34
Stacked Fleet
Floaters
Drillships (2)
2
2
3
3
3
Semisubmersibles
2
2
2
2
2
4
4
5
5
5
Jackups
HD Ultra-Harsh & Harsh
2
2
1
1
1
HD & SD Modern
5
5
5
5
5
7
7
6
6
6
Total Stacked Fleet
11
11
11
11
11
Leased Rigs (3)
Jackups
HD Ultra-Harsh & Harsh
1
1
1
1
1
HD & SD Modern
7
7
7
7
6
Total Leased Rigs
8
8
8
8
7
Valaris Total
51
52
52
52
52
Managed Rigs (3)
2
2
2
2
2
(1)
Active fleet represents rigs that
are not preservation stacked and includes rigs that are in the
process of being reactivated.
(2)
Excludes VALARIS DS-13 and
VALARIS DS-14, which Valaris has the option to take delivery by
year-end 2023.
(3)
Leased rigs and managed rigs
included in Other reporting segment.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
AVAILABLE DAYS - TOTAL FLEET
(1)
Floaters
Drillships
1,001
990
1,012
1,012
979
Semisubmersibles
455
450
460
460
455
1,456
1,440
1,472
1,472
1,434
Jackups
HD Ultra-Harsh & Harsh
990
990
1,012
1,012
1,001
HD & SD Modern
1,274
1,260
1,288
1,328
1,419
SD Legacy
199
270
276
276
279
2,463
2,520
2,576
2,616
2,699
Total
3,919
3,960
4,048
4,088
4,133
Other
Leased and Managed Rigs
910
900
920
880
874
Valaris Total
4,829
4,860
4,968
4,968
5,007
(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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
AVAILABLE DAYS - ACTIVE FLEET
(1)
Floaters
Drillships
819
751
736
736
645
Semisubmersibles
273
270
276
276
273
1,092
1,021
1,012
1,012
918
Jackups
HD Ultra-Harsh & Harsh
808
841
920
920
910
HD & SD Modern
819
810
828
868
910
SD Legacy
199
270
276
276
273
1,826
1,921
2,024
2,064
2,093
Total
2,918
2,942
3,036
3,076
3,011
Other
Leased and Managed Rigs
910
900
920
880
874
Valaris Total
3,828
3,842
3,956
3,956
3,885
(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 and includes rigs
that are in the process of being reactivated.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
OPERATING DAYS (1)
Floaters
Drillships
583
581
623
546
335
Semisubmersibles
272
258
264
251
168
855
839
887
797
503
Jackups
HD Ultra-Harsh & Harsh
540
564
778
862
810
HD & SD Modern
663
718
713
700
750
SD Legacy
155
268
273
184
245
1,358
1,550
1,764
1,746
1,805
Total
2,213
2,389
2,651
2,543
2,308
Other
Leased and Managed Rigs
910
900
920
881
874
Valaris Total
3,123
3,289
3,571
3,424
3,182
(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.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
($ in millions, except average
day rate)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
DRILLSHIPS
Adjusted revenues (1)
$
147.8
$
139.4
$
145.1
$
131.3
$
133.6
Adjusted operating expense (2)
147.1
127.2
127.3
116.8
112.0
Rig operating margin
$
0.7
$
12.2
$
17.8
$
14.5
$
21.6
Rig operating margin %
—
%
9
%
12
%
11
%
16
%
Other operating expenses
Depreciation
12.7
12.1
12.0
11.8
11.6
Loss on impairment
—
—
—
—
34.5
$
12.7
$
12.1
$
12.0
$
11.8
$
46.1
Other operating income (expense) (3)
(0.4
)
—
0.6
(0.3
)
(0.5
)
Operating income (loss)
$
(12.4
)
$
0.1
$
6.4
$
2.4
$
(25.0
)
Adjusted EBITDA (4)
$
0.3
$
12.2
$
18.5
$
14.2
$
21.0
Reactivation costs (5)
44.2
25.9
20.3
17.0
23.3
Adjusted EBITDAR
$
44.5
$
38.1
$
38.8
$
31.2
$
44.3
Preservation and stacking costs (5)
$
3.4
$
4.5
$
4.9
$
4.5
$
11.1
Number of Rigs (at quarter end)
Total Fleet
11
11
11
11
11
Active Fleet
9
9
8
8
8
Operating Days
583
581
623
546
335
Utilization - Active Fleet
71
%
77
%
85
%
74
%
52
%
Average Day Rate
$
232,000
$
221,000
$
215,000
$
220,000
$
213,000
(1)
Revenues exclusive of recurring
reimbursable items.
(2)
Operating expense exclusive of
depreciation, reimbursable items, bad debt expense and onshore
support costs.
(3)
Other operating income (expense)
includes reimbursable revenue and expense, bad debt expense and
other miscellaneous items.
(4)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense.
(5)
Included in adjusted operating
expense.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
($ in millions, except average
day rate)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
SEMISUBMERSIBLES
Adjusted revenues (1)
$
68.7
$
67.2
$
58.4
$
60.7
$
37.1
Adjusted operating expense (2)
37.9
38.9
38.2
33.6
35.0
Rig operating margin
$
30.8
$
28.3
$
20.2
$
27.1
$
2.1
Rig operating margin %
45
%
42
%
35
%
45
%
6
%
Depreciation
0.9
0.9
0.9
0.8
0.7
Other operating income (expense) (3)
0.1
(0.3
)
(0.2
)
(0.1
)
(0.4
)
Operating income
$
30.0
$
27.1
$
19.1
$
26.2
$
1.0
Adjusted EBITDA (4)
$
30.8
$
28.0
$
20.0
$
27.0
$
1.9
Reactivation costs (5)
—
0.3
0.4
0.8
0.7
Adjusted EBITDAR
$
30.8
$
28.3
$
20.4
$
27.8
$
2.6
Preservation and stacking costs (5)
$
1.1
$
1.0
$
1.3
$
1.5
$
4.1
Number of Rigs (at quarter end)
Total Fleet
5
5
5
5
5
Active Fleet
3
3
3
3
3
Operating Days
272
258
264
251
168
Utilization - Active Fleet
100
%
96
%
96
%
91
%
62
%
Average Day Rate
$
240,000
$
246,000
$
204,000
$
226,000
$
214,000
(1)
Revenues exclusive of recurring
reimbursable items.
(2)
Operating expense exclusive of
depreciation, reimbursable items, bad debt expense and onshore
support costs.
(3)
Other operating income (expense)
includes reimbursable revenue and expense, bad debt expense and
other miscellaneous items.
(4)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense.
(5)
Included in adjusted operating
expense.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
($ in millions, except average
day rate)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
HD ULTRA-HARSH & HARSH
JACKUPS
Adjusted revenues (1)
$
54.6
$
71.5
$
95.7
$
119.5
$
102.4
Adjusted operating expense (2)
48.1
68.8
64.4
62.4
67.3
Rig operating margin
$
6.5
$
2.7
$
31.3
$
57.1
$
35.1
Rig operating margin %
12
%
4
%
33
%
48
%
34
%
Depreciation
5.7
5.7
5.7
5.6
5.5
Other operating income (expense) (3)
(0.4
)
0.4
0.2
0.3
0.2
Operating income (loss)
$
0.4
$
(2.6
)
$
25.8
$
51.8
$
29.8
Adjusted EBITDA (4)
$
6.1
$
3.0
$
31.4
$
57.1
$
35.3
Reactivation costs (5)
—
0.1
—
(0.1
)
0.2
Adjusted EBITDAR
$
6.1
$
3.1
$
31.4
$
57.0
$
35.5
Preservation and stacking costs (5)
$
1.4
$
5.1
$
(0.5
)
$
—
$
0.6
Number of Rigs (at quarter end) (6)
Total Fleet
11
11
11
11
11
Active Fleet
9
9
10
10
10
Operating Days
540
564
778
862
810
Utilization - Active Fleet
67
%
67
%
85
%
94
%
89
%
Average Day Rate
$
97,000
$
97,000
$
108,000
$
121,000
$
114,000
(1)
Revenues exclusive of recurring
reimbursable items.
(2)
Operating expense exclusive of
depreciation, reimbursable items, bad debt expense and onshore
support costs.
(3)
Other operating income (expense)
includes reimbursable revenue and expense, bad debt expense and
other miscellaneous items.
(4)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense.
(5)
Included in adjusted operating
expense.
(6)
Jackup rigs leased to ARO are not
included in the number of rigs at quarter end.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
($ in millions, except average
day rate)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
HD & SD MODERN JACKUPS
Adjusted revenues (1)
$
68.0
$
70.4
$
62.2
$
58.9
$
61.1
Adjusted operating expense (2)
56.2
60.9
49.0
48.4
58.6
Rig operating margin
$
11.8
$
9.5
$
13.2
$
10.5
$
2.5
Rig operating margin %
17
%
13
%
21
%
18
%
4
%
Depreciation
2.8
2.3
2.3
2.2
2.3
Other operating expense (3)
(0.2
)
(0.1
)
(2.2
)
(1.9
)
(2.0
)
Operating income (loss)
$
8.8
$
7.1
$
8.7
$
6.4
$
(1.8
)
Adjusted EBITDA (4)
$
11.6
$
9.4
$
13.0
$
10.6
$
2.4
Reactivation costs (5)
(0.1
)
—
—
0.1
0.1
Adjusted EBITDAR
$
11.5
$
9.4
$
13.0
$
10.7
$
2.5
Preservation and stacking costs (5)
$
2.0
$
2.5
$
2.4
$
2.4
$
3.3
Number of Rigs (at quarter end) (6)
Total Fleet
14
14
14
14
15
Active Fleet
9
9
9
9
10
Operating Days
663
718
713
700
750
Utilization - Active Fleet
81
%
89
%
86
%
81
%
82
%
Average Day Rate
$
97,000
$
92,000
$
83,000
$
82,000
$
79,000
(1)
Revenues exclusive of recurring
reimbursable items and amortization of drilling contract
intangibles.
(2)
Operating expense exclusive of
depreciation, reimbursable items, bad debt expense and onshore
support costs.
(3)
Other operating expense includes
reimbursable revenue and expense, bad debt expense and other
miscellaneous items.
(4)
Adjusted EBITDA for asset category
excludes onshore support costs and general and administrative
expense.
(5)
Included in adjusted operating
expense.
(6)
Jackup rigs leased to ARO are not included
in the number of rigs at quarter end.
VALARIS LIMITED AND
SUBSIDIARIES
OPERATING STATISTICS
($ in millions, except average
day rate)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
SD LEGACY JACKUPS
Adjusted revenues (1)
$
13.0
$
20.4
$
20.4
$
13.6
$
18.1
Adjusted operating expense (2)
9.6
12.0
10.5
11.7
10.4
Rig operating margin
$
3.4
$
8.4
$
9.9
$
1.9
$
7.7
Rig operating margin %
26
%
41
%
49
%
14
%
43
%
Depreciation
1.1
1.0
1.6
0.9
0.9
Other operating income (expense) (3)
—
—
(0.1
)
—
0.1
Operating income
$
2.3
$
7.4
$
8.2
$
1.0
$
6.9
Adjusted EBITDA (4)
$
3.4
$
8.4
$
9.8
$
2.0
$
7.8
Adjusted EBITDAR
$
3.4
$
8.4
$
9.8
$
2.0
$
7.8
Preservation and stacking costs (5)
$
0.2
$
—
$
0.1
$
0.1
$
(0.1
)
Number of Rigs (at quarter end) (6)
Total Fleet
2
3
3
3
3
Active Fleet
2
3
3
3
3
Operating Days
155
268
273
184
245
Utilization - Active Fleet
78
%
99
%
99
%
67
%
90
%
Average Day Rate
$
81,000
$
76,000
$
74,000
$
74,000
$
74,000
(1)
Revenues exclusive of recurring
reimbursable items.
(2)
Operating expense exclusive of
depreciation, reimbursable items, bad debt expense and onshore
support costs.
(3)
Other operating income (expense)
includes reimbursable revenue and expense, bad debt expense and
other miscellaneous items.
(4)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense.
(5)
Included in adjusted operating
expense.
(6)
Jackup rigs leased to ARO are not
included in the number of rigs at quarter end.
ARO DRILLING
CONDENSED BALANCE SHEET
INFORMATION
(In millions)
As of
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Cash
$
100.6
$
101.2
$
176.2
$
173.5
$
293.3
Other current assets
188.3
189.3
140.6
145.6
106.3
Non-current assets
879.6
830.2
818.1
800.9
777.5
Total assets
$
1,168.5
$
1,120.7
$
1,134.9
$
1,120.0
$
1,177.1
Current liabilities
$
122.6
$
68.5
$
86.3
$
87.3
$
63.7
Non-current liabilities
887.5
887.4
884.6
879.5
958.7
Total liabilities
$
1,010.1
$
955.9
$
970.9
$
966.8
$
1,022.4
Shareholders' equity
$
158.4
$
164.8
$
164.0
$
153.2
$
154.7
Total liabilities and shareholders'
equity
$
1,168.5
$
1,120.7
$
1,134.9
$
1,120.0
$
1,177.1
ARO DRILLING
CONDENSED INCOME STATEMENT
INFORMATION
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
Revenues
$
117.8
$
123.6
$
120.4
$
111.4
$
116.4
Operating expenses
Contract drilling (exclusive of
depreciation)
95.0
90.9
85.5
90.0
82.1
Depreciation
15.6
15.0
16.1
15.4
15.4
General and administrative
5.7
4.6
5.6
4.7
3.2
Operating income
$
1.5
$
13.1
$
13.2
$
1.3
$
15.7
Other expense, net
8.8
10.4
1.8
2.7
3.3
Provision (benefit) for income taxes
—
1.9
0.7
(0.1
)
2.5
Net income (loss)
$
(7.3
)
$
0.8
$
10.7
$
(1.3
)
$
9.9
EBITDA
$
17.1
$
28.1
$
29.3
$
16.7
$
31.1
ARO Drilling condensed balance sheet and income statement
information presented above represents 100% of ARO. Valaris has a
50% ownership interest in ARO.
ARO DRILLING
OPERATING STATISTICS
As of
(In millions)
August 1, 2023
May 1, 2023
February 21, 2023
October 31, 2022
July 28, 2022
CONTRACT BACKLOG (1)
Owned Rigs
$
686.3
$
747.7
$
794.3
$
870.7
$
934.9
Leased Rigs
815.0
884.7
937.5
473.3
524.3
Total
$
1,501.3
$
1,632.4
$
1,731.8
$
1,344.0
$
1,459.2
(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.
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
AVERAGE DAY RATES (1)
Owned Rigs
$
90,000
$
99,000
$
95,000
$
96,000
$
94,000
Leased Rigs (2)
98,000
98,000
91,000
91,000
91,000
Total
$
95,000
$
98,000
$
93,000
$
93,000
$
92,000
UTILIZATION (3)
Owned Rigs
83
%
91
%
96
%
86
%
97
%
Leased Rigs (2)
98
%
95
%
91
%
92
%
96
%
Total
91
%
93
%
93
%
89
%
96
%
REVENUE EFFICIENCY (4)
Owned Rigs
95
%
98
%
97
%
98
%
97
%
Leased Rigs (2)
99
%
95
%
93
%
96
%
97
%
Total
97
%
96
%
95
%
97
%
97
%
NUMBER OF RIGS (AT QUARTER END)
(5)
Owned Rigs
7
7
7
7
7
Leased Rigs (2)
8
8
8
8
7
Total
15
15
15
15
14
AVAILABLE DAYS (6)
Owned Rigs
637
630
644
644
637
Leased Rigs (2)
728
720
736
696
671
Total
1,365
1,350
1,380
1,340
1,308
OPERATING DAYS (7)
Owned Rigs
532
575
618
553
619
Leased Rigs (2)
713
683
672
640
642
Total
1,245
1,258
1,290
1,193
1,261
(1)
Average day rates are derived by
dividing contract drilling revenues, adjusted to exclude certain
types of non-recurring reimbursable revenues, lump-sum revenues,
revenues earned during suspension periods and revenues attributable
to amortization of drilling contract intangibles, by the aggregate
number of contract days, adjusted to exclude contract days
associated with certain suspension periods, mobilizations,
demobilizations and shipyard contracts.
(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)
Rig count for owned rigs excludes
two rigs under construction. We expect delivery of these rigs to be
in 2023.
(6)
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.
(7)
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.
Non-GAAP Financial Measures
To supplement Valaris’ condensed consolidated financial
statements presented on a GAAP basis, this press release provides
investors with Adjusted EBITDA and Adjusted EBITDAR, which are
non-GAAP measures.
Valaris defines "Adjusted EBITDA" as net income (loss) from
continuing operations before income tax expense, interest expense,
other (income) expense, depreciation expense, amortization, loss on
impairment 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.
In the second quarter 2023, Valaris changed its Adjusted EBITDA
and Adjusted EBITDAR calculations to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Adjusted EBITDA and Adjusted EBITDAR for
all comparative periods have been revised using the new methodology
to consistently reflect this change.
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 "EBITDA" as net income before income tax
expense, other expense, net and depreciation expense. 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. 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. 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
second quarter 2023 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).
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.
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
June 30, 2023
March 31, 2023
VALARIS
Net income (loss)
$
(27.3
)
$
48.6
Add (subtract):
Income tax expense (benefit)
24.5
(27.6
)
Interest expense
16.7
11.1
Other income
(23.8
)
(23.6
)
Operating income (loss)
$
(9.9
)
$
8.5
Add (subtract):
Depreciation expense
24.5
23.3
Equity in (earnings) losses of ARO
0.7
(3.3
)
Adjusted EBITDA (1)
$
15.3
$
28.5
(1)
Starting from the second quarter
2023, our Adjusted EBITDA calculation was changed to include
amortization associated with deferred mobilization and contract
preparation revenues and costs and deferred capital upgrade
revenues to better reflect the earnings profile of our operations
and more closely align with the calculation methodology used by
Valaris' closest offshore drilling peers. Prior periods were
adjusted to conform with the current period presentation.
Three Months Ended
June 30, 2023
March 31, 2023
ARO
Net income (loss)
$
(7.3
)
$
0.8
Add:
Income tax expense
—
1.9
Other expense, net
8.8
10.4
Operating income
$
1.5
$
13.1
Add:
Depreciation expense
15.6
15.0
EBITDA
$
17.1
$
28.1
Reconciliation of Net Income to Adjusted EBITDA and Adjusted
EBITDAR
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
FLOATERS
Net income
$
17.9
$
27.5
Subtract:
Other income
(0.3
)
(0.3
)
Operating income
$
17.6
$
27.2
Add (subtract):
Depreciation and amortization
13.8
13.1
Other costs
(0.3
)
(0.1
)
Adjusted EBITDA (1)
$
31.1
$
40.2
Add:
Reactivation costs
44.2
26.2
Adjusted EBITDAR (1)
$
75.3
$
66.4
JACKUPS
Net income
$
39.1
$
12.1
Add (subtract):
Other income
(27.6
)
(0.2
)
Operating income
$
11.5
$
11.9
Add (subtract):
Depreciation and amortization
9.7
9.1
Other costs
(0.1
)
(0.2
)
Adjusted EBITDA (1)
$
21.1
$
20.8
Add (subtract):
Reactivation costs
(0.1
)
0.1
Adjusted EBITDAR (1)
$
21.0
$
20.9
OTHER
Net income
$
23.8
$
24.0
Operating income
$
23.8
$
24.0
Add (subtract):
Depreciation and amortization
3.5
1.2
Other costs
(2.4
)
0.2
Adjusted EBITDA (1)
$
24.9
$
25.4
Adjusted EBITDAR (1)
$
24.9
$
25.4
(1)
Starting from the second quarter
2023, our Adjusted EBITDA and Adjusted EBITDAR calculation were
changed to include amortization associated with deferred
mobilization and contract preparation revenues and costs and
deferred capital upgrade revenues to better reflect the earnings
profile of our operations and more closely align with the
calculation methodology used by Valaris' closest offshore drilling
peers. Prior periods were adjusted to conform with the current
period presentation.
Reconciliation of Net Income (Loss) to Adjusted
EBITDAR
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
ACTIVE FLEET (1)
Net income
$
68.2
$
55.4
$
79.9
$
98.8
$
67.3
Add (subtract):
Other (income) expense
(27.4
)
—
(0.9
)
—
0.1
Operating income
$
40.8
$
55.4
$
79.0
$
98.8
$
67.4
Add (subtract):
Reactivation costs
44.1
26.3
20.7
17.8
24.3
Depreciation and amortization
19.9
18.9
21.9
20.8
27.8
Support and other costs
(0.3
)
(0.2
)
(0.1
)
(0.2
)
(7.8
)
Adjusted EBITDAR (2)
$
104.5
$
100.4
$
121.5
$
137.2
$
111.7
LEASED AND MANAGED RIGS
Net income
$
23.8
$
24.0
$
21.2
$
20.7
$
13.4
Subtract:
Other income
—
—
—
(0.1
)
—
Operating income
$
23.8
$
24.0
$
21.2
$
20.6
$
13.4
Add (subtract):
Depreciation and amortization
3.5
1.3
1.3
1.3
1.3
Support and other costs
(2.4
)
0.1
(0.2
)
0.1
0.2
Adjusted EBITDAR (2)
$
24.9
$
25.4
$
22.3
$
22.0
$
14.9
STACKED FLEET
Net income (loss)
$
(11.7
)
$
(15.8
)
$
(6.9
)
$
(11.1
)
$
78.9
Add (subtract):
Other (income) expense
—
(0.5
)
(3.9
)
0.1
(135.4
)
Operating loss
$
(11.7
)
$
(16.3
)
$
(10.8
)
$
(11.0
)
$
(56.5
)
Add (subtract):
Depreciation and amortization
1.3
3.2
2.7
2.6
(4.6
)
Loss on impairment
—
—
—
—
34.5
Support and other costs
2.2
—
—
(0.1
)
7.6
Adjusted EBITDAR (2)
$
(8.2
)
$
(13.1
)
$
(8.1
)
$
(8.5
)
$
(19.0
)
TOTAL FLEET
Net income
$
80.3
$
63.6
$
94.2
$
108.4
$
159.6
Subtract:
Other income
(27.4
)
(0.5
)
(4.8
)
—
(135.3
)
Operating income
$
52.9
$
63.1
$
89.4
$
108.4
$
24.3
Add (subtract):
Reactivation costs
44.1
26.3
20.7
17.8
24.3
Depreciation and amortization
24.7
23.4
25.9
24.7
24.5
Loss on impairment
—
—
—
—
34.5
Support and other costs
(0.5
)
(0.1
)
(0.3
)
(0.2
)
—
Adjusted EBITDAR (2)
$
121.2
$
112.7
$
135.7
$
150.7
$
107.6
(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. Starting in
the second quarter 2023, our Adjusted EBITDAR calculation was
changed to include amortization associated with deferred
mobilization and contract preparation revenues and costs and
deferred capital upgrade revenues to better reflect the earnings
profile of our operations and more closely align with the
calculation methodology used by Valaris' closest offshore drilling
peers. Prior periods were adjusted to conform with the current
period presentation.
Reconciliation of Operating Revenues to Adjusted Revenues,
Operating Expenses to Adjusted Operating Expenses and Net Income
(Loss) to Adjusted EBITDA
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
DRILLSHIPS
Operating revenues
$
157.7
$
146.5
$
151.9
$
139.8
$
149.0
Subtract:
Reimbursable revenues
(9.9
)
(7.1
)
(6.8
)
(8.5
)
(15.4
)
Adjusted revenues
$
147.8
$
139.4
$
145.1
$
131.3
$
133.6
Operating expenses
$
170.1
$
146.5
$
145.4
$
137.5
$
174.0
Add (subtract):
Depreciation and amortization
(12.9
)
(12.2
)
(12.1
)
(11.9
)
(11.4
)
Loss on impairment
—
—
—
—
(34.5
)
Reimbursable expenses
(10.0
)
(7.1
)
(6.9
)
(8.3
)
(15.5
)
Other
(0.1
)
—
0.9
(0.5
)
(0.6
)
Adjusted operating expenses
$
147.1
$
127.2
$
127.3
$
116.8
$
112.0
Net income (loss)
$
(12.0
)
$
0.4
$
7.3
$
2.4
$
(25.2
)
Add (subtract):
Other (income) expense
(0.4
)
(0.3
)
(0.9
)
—
0.2
Operating income (loss)
(12.4
)
0.1
6.4
2.4
(25.0
)
Add (subtract):
Depreciation and amortization
12.9
12.2
12.1
11.9
11.4
Loss on impairment
—
—
—
—
34.5
Other
(0.2
)
(0.1
)
—
(0.1
)
0.1
Adjusted EBITDA (1)
$
0.3
$
12.2
$
18.5
$
14.2
$
21.0
(1)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense. Starting from the second quarter 2023, our
Adjusted EBITDA calculation was changed to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Prior periods were adjusted to conform
with the current period presentation.
Reconciliation of Operating Revenues to Adjusted Revenues,
Operating Expenses to Adjusted Operating Expenses and Net Income
(Loss) to Adjusted EBITDA
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
SEMISUBMERSIBLES
Operating revenues
$
69.7
$
68.3
$
59.1
$
61.9
$
39.1
Subtract:
Reimbursable revenues
(1.0
)
(1.1
)
(0.7
)
(1.2
)
(2.0
)
Adjusted revenues
$
68.7
$
67.2
$
58.4
$
60.7
$
37.1
Operating expenses
$
39.7
$
41.1
$
40.1
$
35.6
$
38.1
Add (subtract):
Depreciation and amortization
(0.9
)
(0.9
)
(0.8
)
(0.8
)
(0.8
)
Reimbursable expenses
(1.0
)
(1.1
)
(0.9
)
(1.2
)
(2.1
)
Other
0.1
(0.2
)
(0.2
)
—
(0.2
)
Adjusted operating expenses
$
37.9
$
38.9
$
38.2
$
33.6
$
35.0
Net income
$
29.9
$
27.1
$
19.3
$
26.2
$
1.1
Add (subtract):
Other (income) expense
0.1
—
(0.2
)
—
(0.1
)
Operating income
30.0
27.1
19.1
26.2
1.0
Add (subtract):
Depreciation and amortization
0.9
0.9
0.8
0.8
0.8
Other
(0.1
)
—
0.1
—
0.1
Adjusted EBITDA (1)
$
30.8
$
28.0
$
20.0
$
27.0
$
1.9
(1)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense. Starting from the second quarter 2023, our
Adjusted EBITDA calculation was changed to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Prior periods were adjusted to conform
with the current period presentation.
Reconciliation of Operating Revenues to Adjusted Revenues,
Operating Expenses to Adjusted Operating Expenses and Net Income
(Loss) to Adjusted EBITDA
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
HD ULTRA-HARSH & HARSH
JACKUPS
Operating revenues
$
56.7
$
75.7
$
98.5
$
123.0
$
106.1
Subtract:
Reimbursable revenues
(2.1
)
(4.2
)
(2.8
)
(3.5
)
(3.7
)
Adjusted revenues
$
54.6
$
71.5
$
95.7
$
119.5
$
102.4
Operating expenses
$
56.3
$
78.4
$
72.8
$
71.2
$
76.3
Add (subtract):
Depreciation and amortization
(5.8
)
(5.8
)
(5.7
)
(5.7
)
(5.5
)
Reimbursable expenses
(2.2
)
(3.9
)
(2.8
)
(3.1
)
(3.3
)
Other
(0.2
)
0.1
0.1
—
(0.2
)
Adjusted operating expenses
$
48.1
$
68.8
$
64.4
$
62.4
$
67.3
Net income (loss)
$
0.4
$
(2.5
)
$
29.3
$
51.7
$
29.8
Add (subtract):
Other (income) expense
—
(0.1
)
(3.5
)
0.1
—
Operating income (loss)
0.4
(2.6
)
25.8
51.8
29.8
Add (subtract):
Depreciation and amortization
5.8
5.8
5.7
5.7
5.5
Other
(0.1
)
(0.2
)
(0.1
)
(0.4
)
—
Adjusted EBITDA (1)
$
6.1
$
3.0
$
31.4
$
57.1
$
35.3
(1)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense. Starting from the second quarter 2023, our
Adjusted EBITDA calculation was changed to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Prior periods were adjusted to conform
with the current period presentation.
Reconciliation of Operating Revenues to Adjusted Revenues,
Operating Expenses to Adjusted Operating Expenses and Net Income to
Adjusted EBITDA
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
HD & SD MODERN JACKUPS
Operating revenues
$
74.2
$
73.2
$
62.5
$
59.0
$
61.1
Add (subtract):
Reimbursable revenues
(6.2
)
(2.8
)
(2.2
)
(2.0
)
(1.9
)
Amortization of drilling contract
intangibles
—
—
1.9
1.9
1.9
Adjusted revenues
$
68.0
$
70.4
$
62.2
$
58.9
$
61.1
Operating expenses
$
65.5
$
66.1
$
53.7
$
52.6
$
62.8
Add (subtract):
Depreciation and amortization
(2.9
)
(2.4
)
(2.4
)
(2.3
)
(2.4
)
Reimbursable expenses
(6.2
)
(2.9
)
(2.3
)
(2.0
)
(1.9
)
Other
(0.2
)
0.1
—
0.1
0.1
Adjusted operating expenses
$
56.2
$
60.9
$
49.0
$
48.4
$
58.6
Net income
$
8.9
$
7.2
$
8.8
$
6.5
$
118.3
Subtract:
Other income
(0.1
)
(0.1
)
(0.1
)
(0.1
)
(120.1
)
Operating income (loss)
8.8
7.1
8.7
6.4
(1.8
)
Add (subtract):
Depreciation and amortization
2.9
2.4
4.4
4.2
4.5
Other
(0.1
)
(0.1
)
(0.1
)
—
(0.3
)
Adjusted EBITDA (1)
$
11.6
$
9.4
$
13.0
$
10.6
$
2.4
(1)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense. Starting from the second quarter 2023, our
Adjusted EBITDA calculation was changed to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Prior periods were adjusted to conform
with the current period presentation.
Reconciliation of Operating Revenues to Adjusted Revenues,
Operating Expenses to Adjusted Operating Expenses and Net Income to
Adjusted EBITDA
(In millions)
Three Months Ended
June 30, 2023
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
SD LEGACY JACKUPS
Operating revenues
$
13.7
$
20.9
$
20.8
$
13.9
$
18.6
Subtract:
Reimbursable revenues
(0.7
)
(0.5
)
(0.4
)
(0.3
)
(0.5
)
Adjusted revenues
$
13.0
$
20.4
$
20.4
$
13.6
$
18.1
Operating expenses
$
11.3
$
13.4
$
12.6
$
12.9
$
11.8
Subtract:
Depreciation and amortization
(1.0
)
(0.9
)
(1.6
)
(1.0
)
(0.8
)
Reimbursable expenses
(0.7
)
(0.5
)
(0.5
)
(0.2
)
(0.5
)
Other
—
—
—
—
(0.1
)
Adjusted operating expenses
$
9.6
$
12.0
$
10.5
$
11.7
$
10.4
Net income
$
29.8
$
7.4
$
8.3
$
0.9
$
22.2
Add (subtract):
Other (income) expense
(27.5
)
—
(0.1
)
0.1
(15.3
)
Operating income
2.3
7.4
8.2
1.0
6.9
Add:
Depreciation and amortization
1.0
0.9
1.6
1.0
0.8
Other
0.1
0.1
—
—
0.1
Adjusted EBITDA (1)
$
3.4
$
8.4
$
9.8
$
2.0
$
7.8
(1)
Adjusted EBITDA for asset
category excludes onshore support costs and general and
administrative expense. Starting from the second quarter 2023, our
Adjusted EBITDA calculation was changed to include amortization
associated with deferred mobilization and contract preparation
revenues and costs and deferred capital upgrade revenues to better
reflect the earnings profile of our operations and more closely
align with the calculation methodology used by Valaris' closest
offshore drilling peers. Prior periods were adjusted to conform
with the current period presentation.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230801798839/en/
Investor & Media Contacts: Darin Gibbins Vice President -
Investor Relations and Treasurer +1-713-979-4623
Tim Richardson Director - Investor Relations +1-713-979-4619
Valaris (NYSE:VAL)
Historical Stock Chart
From Jun 2024 to Jul 2024
Valaris (NYSE:VAL)
Historical Stock Chart
From Jul 2023 to Jul 2024