x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
England and Wales (Registered Number 08354954) | 98-0619597 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) |
Cayman Islands | 98-0366361 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) |
Noble Corporation plc: | Large accelerated filer þ | Accelerated filer ¨ | Non-accelerated filer ¨ | Smaller reporting company ¨ | Emerging growth company ¨ |
Noble Corporation: | Large accelerated filer ¨ | Accelerated filer ¨ | Non-accelerated filer þ | Smaller reporting company ¨ | Emerging growth company ¨ |
Name of Company | Title of each class | Trading symbol(s) | Name of each exchange on which registered | |||
Noble Corporation plc | Ordinary Shares | NE | New York Stock Exchange | |||
Noble Corporation | None | — | — |
Page | ||||
PART I | ||||
Item 1 | ||||
Noble Corporation plc (Noble-UK) Financial Statements: | ||||
Noble Corporation (Noble-Cayman) Financial Statements: | ||||
Item 2 | ||||
Item 3 | ||||
Item 4 | ||||
PART II | ||||
Item 1 | ||||
Item 1A | ||||
Item 2 | ||||
Item 6 | ||||
March 31, 2019 | December 31, 2018 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 187,093 | $ | 375,232 | ||||
Accounts receivable, net | 211,729 | 200,722 | ||||||
Taxes receivable | 16,294 | 20,498 | ||||||
Prepaid expenses and other current assets | 45,994 | 62,604 | ||||||
Total current assets | 461,110 | 659,056 | ||||||
Property and equipment, at cost | 11,017,281 | 10,956,412 | ||||||
Accumulated depreciation | (2,510,699 | ) | (2,475,694 | ) | ||||
Property and equipment, net | 8,506,582 | 8,480,718 | ||||||
Other assets | 148,622 | 125,149 | ||||||
Total assets | $ | 9,116,314 | $ | 9,264,923 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities | ||||||||
Current maturities of long-term debt | $ | 300,000 | $ | — | ||||
Accounts payable | 111,044 | 125,557 | ||||||
Accrued payroll and related costs | 34,867 | 50,284 | ||||||
Taxes payable | 26,482 | 29,386 | ||||||
Interest payable | 64,201 | 100,100 | ||||||
Other current liabilities | 59,038 | 60,130 | ||||||
Total current liabilities | 595,632 | 365,457 | ||||||
Long-term debt | 3,550,791 | 3,877,402 | ||||||
Deferred income taxes | 81,009 | 91,695 | ||||||
Other liabilities | 305,074 | 275,795 | ||||||
Total liabilities | 4,532,506 | 4,610,349 | ||||||
Commitments and contingencies (Note 13) | ||||||||
Shareholders’ equity | ||||||||
Common stock, $0.01 par value, ordinary shares; 249,150 and 246,794 shares outstanding as of March 31, 2019 and December 31, 2018, respectively | 2,491 | 2,468 | ||||||
Additional paid-in capital | 699,552 | 699,409 | ||||||
Retained earnings | 3,537,477 | 3,608,366 | ||||||
Accumulated other comprehensive loss | (56,014 | ) | (57,072 | ) | ||||
Total shareholders’ equity | 4,183,506 | 4,253,171 | ||||||
Noncontrolling interests | 400,302 | 401,403 | ||||||
Total equity | 4,583,808 | 4,654,574 | ||||||
Total liabilities and equity | $ | 9,116,314 | $ | 9,264,923 |
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Operating revenues | ||||||||
Contract drilling services | $ | 270,501 | $ | 229,106 | ||||
Reimbursables and other | 12,387 | 6,051 | ||||||
282,888 | 235,157 | |||||||
Operating costs and expenses | ||||||||
Contract drilling services | 171,728 | 136,849 | ||||||
Reimbursables | 9,395 | 4,350 | ||||||
Depreciation and amortization | 109,578 | 128,755 | ||||||
General and administrative | 15,999 | 22,083 | ||||||
306,700 | 292,037 | |||||||
Operating loss | (23,812 | ) | (56,880 | ) | ||||
Other income (expense) | ||||||||
Interest expense, net of amounts capitalized | (70,244 | ) | (76,015 | ) | ||||
Gain (loss) on extinguishment of debt, net | 31,266 | (8,768 | ) | |||||
Interest income and other, net | 2,506 | 1,339 | ||||||
Loss from continuing operations before income taxes | (60,284 | ) | (140,324 | ) | ||||
Income tax provision | (2,865 | ) | (2,996 | ) | ||||
Net loss from continuing operations | (63,149 | ) | (143,320 | ) | ||||
Net loss from discontinued operations, net of tax | (3,821 | ) | — | |||||
Net loss | (66,970 | ) | (143,320 | ) | ||||
Net (income) loss attributable to noncontrolling interests | (3,919 | ) | 986 | |||||
Net loss attributable to Noble Corporation plc | $ | (70,889 | ) | $ | (142,334 | ) | ||
Net loss attributable to Noble Corporation plc | ||||||||
Net loss from continuing operations | $ | (67,068 | ) | $ | (142,334 | ) | ||
Net loss from discontinued operations, net of tax | (3,821 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (70,889 | ) | $ | (142,334 | ) | ||
Per share data | ||||||||
Basic: | ||||||||
Loss from continuing operations | $ | (0.27 | ) | $ | (0.58 | ) | ||
Loss from discontinued operations | (0.02 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (0.29 | ) | $ | (0.58 | ) | ||
Diluted: | ||||||||
Loss from continuing operations | $ | (0.27 | ) | $ | (0.58 | ) | ||
Loss from discontinued operations | (0.02 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (0.29 | ) | $ | (0.58 | ) | ||
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Net loss | $ | (66,970 | ) | $ | (143,320 | ) | ||
Other comprehensive income (loss) | ||||||||
Foreign currency translation adjustments | 508 | 667 | ||||||
Amortization of deferred pension plan amounts (net of tax provision of $145 and $87 for the three months ended March 31, 2019 and 2018, respectively) | 550 | 324 | ||||||
Other comprehensive income, net | 1,058 | 991 | ||||||
Net comprehensive (income) loss attributable to noncontrolling interests | (3,919 | ) | 986 | |||||
Comprehensive loss attributable to Noble Corporation plc | $ | (69,831 | ) | $ | (141,343 | ) |
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Cash flows from operating activities | ||||||||
Net loss | $ | (66,970 | ) | $ | (143,320 | ) | ||
Adjustments to reconcile net loss to net cash flow from operating activities: | ||||||||
Depreciation and amortization | 109,578 | 128,755 | ||||||
(Gain) loss on extinguishment of debt, net | (31,266 | ) | 8,768 | |||||
Deferred income taxes | 2,208 | (4,906 | ) | |||||
Amortization of share-based compensation | 2,952 | 6,282 | ||||||
Other costs, net | (3,264 | ) | 3,626 | |||||
Changes in components of working capital: | ||||||||
Change in taxes receivable | 4,204 | 84,486 | ||||||
Net changes in other operating assets and liabilities | (58,217 | ) | (28,778 | ) | ||||
Net cash provided by (used in) operating activities | (40,775 | ) | 54,913 | |||||
Cash flows from investing activities | ||||||||
Capital expenditures | (96,793 | ) | (33,816 | ) | ||||
Proceeds from disposal of assets, net | 7,930 | 117 | ||||||
Net cash used in investing activities | (88,863 | ) | (33,699 | ) | ||||
Cash flows from financing activities | ||||||||
Issuance of senior notes | — | 750,000 | ||||||
Borrowings on credit facilities | 350,000 | — | ||||||
Repayments of debt | (400,000 | ) | (952,209 | ) | ||||
Debt issuance costs | (90 | ) | (14,184 | ) | ||||
Dividends paid to noncontrolling interests | (5,020 | ) | (2,667 | ) | ||||
Taxes withheld on employee stock transactions | (2,763 | ) | (3,305 | ) | ||||
Net cash used in financing activities | (57,873 | ) | (222,365 | ) | ||||
Net decrease in cash, cash equivalents and restricted cash | (187,511 | ) | (201,151 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 375,907 | 662,829 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 188,396 | $ | 461,678 |
Shares | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||
Balance | Par Value | ||||||||||||||||||||||||||
Balance at December 31, 2017 | 244,971 | $ | 2,450 | $ | 678,922 | $ | 4,637,677 | $ | (42,888 | ) | $ | 674,467 | $ | 5,950,628 | |||||||||||||
Tax effect of intra-entity asset transfers | — | — | — | (148,393 | ) | — | — | (148,393 | ) | ||||||||||||||||||
Stranded tax effect resulting from the Tax Cuts and Jobs Act | — | — | — | 5,540 | (5,540 | ) | — | — | |||||||||||||||||||
Adjustment for adopting the revenue recognition standard | — | — | — | (1,488 | ) | — | — | (1,488 | ) | ||||||||||||||||||
Balance at January 1, 2018 | 244,971 | 2,450 | 678,922 | 4,493,336 | (48,428 | ) | 674,467 | 5,800,747 | |||||||||||||||||||
Employee related equity activity | |||||||||||||||||||||||||||
Amortization of share-based compensation | — | — | 6,282 | — | — | — | 6,282 | ||||||||||||||||||||
Issuance of share-based compensation shares | 1,807 | 14 | (2 | ) | — | — | — | 12 | |||||||||||||||||||
Shares withheld for taxes on equity transactions | — | — | (3,319 | ) | — | — | — | (3,319 | ) | ||||||||||||||||||
Net loss | — | — | — | (142,334 | ) | — | (986 | ) | (143,320 | ) | |||||||||||||||||
Dividends paid to noncontrolling interests | — | — | — | — | — | (2,667 | ) | (2,667 | ) | ||||||||||||||||||
Dividend equivalents (1) | — | — | — | 116 | — | — | 116 | ||||||||||||||||||||
Other comprehensive income, net | — | — | — | — | 991 | — | 991 | ||||||||||||||||||||
Balance at March 31, 2018 | 246,778 | $ | 2,464 | $ | 681,883 | $ | 4,351,118 | $ | (47,437 | ) | $ | 670,814 | $ | 5,658,842 | |||||||||||||
Balance at December 31, 2018 | 246,794 | $ | 2,468 | $ | 699,409 | $ | 3,608,366 | $ | (57,072 | ) | $ | 401,403 | $ | 4,654,574 | |||||||||||||
Employee related equity activity | |||||||||||||||||||||||||||
Amortization of share-based compensation | — | — | 2,952 | — | — | — | 2,952 | ||||||||||||||||||||
Issuance of share-based compensation shares | 2,356 | 23 | (23 | ) | — | — | — | — | |||||||||||||||||||
Shares withheld for taxes on equity transactions | — | — | (2,786 | ) | — | — | — | (2,786 | ) | ||||||||||||||||||
Net income (loss) | — | — | — | (70,889 | ) | — | 3,919 | (66,970 | ) | ||||||||||||||||||
Dividends paid to noncontrolling interests | — | — | — | — | — | (5,020 | ) | (5,020 | ) | ||||||||||||||||||
Other comprehensive income, net | — | — | — | — | 1,058 | — | 1,058 | ||||||||||||||||||||
Balance at March 31, 2019 | 249,150 | $ | 2,491 | $ | 699,552 | $ | 3,537,477 | $ | (56,014 | ) | $ | 400,302 | $ | 4,583,808 |
(1) | Activity associated with dividend equivalents, which are related to performance awards granted in 2016, to be paid upon vesting. |
March 31, 2019 | December 31, 2018 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 187,015 | $ | 374,375 | ||||
Accounts receivable, net | 211,729 | 200,722 | ||||||
Taxes receivable | 16,303 | 20,498 | ||||||
Prepaid expenses and other current assets | 45,601 | 61,917 | ||||||
Total current assets | 460,648 | 657,512 | ||||||
Property and equipment, at cost | 11,017,281 | 10,956,412 | ||||||
Accumulated depreciation | (2,510,699 | ) | (2,475,694 | ) | ||||
Property and equipment, net | 8,506,582 | 8,480,718 | ||||||
Other assets | 148,622 | 125,149 | ||||||
Total assets | $ | 9,115,852 | $ | 9,263,379 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities | ||||||||
Current maturities of long-term debt | $ | 300,000 | $ | — | ||||
Accounts payable | 110,915 | 125,237 | ||||||
Accrued payroll and related costs | 34,867 | 50,284 | ||||||
Taxes payable | 26,482 | 29,386 | ||||||
Interest payable | 64,201 | 100,100 | ||||||
Other current liabilities | 59,038 | 60,012 | ||||||
Total current liabilities | 595,503 | 365,019 | ||||||
Long-term debt | 3,550,791 | 3,877,402 | ||||||
Deferred income taxes | 81,009 | 91,695 | ||||||
Other liabilities | 305,074 | 275,795 | ||||||
Total liabilities | 4,532,377 | 4,609,911 | ||||||
Commitments and contingencies (Note 13) | ||||||||
Shareholders’ equity | ||||||||
Common stock, $0.10 par value, ordinary shares; 261,246 shares outstanding as of March 31, 2019 and December 31, 2018 | 26,125 | 26,125 | ||||||
Capital in excess of par value | 650,022 | 647,082 | ||||||
Retained earnings | 3,563,040 | 3,635,930 | ||||||
Accumulated other comprehensive loss | (56,014 | ) | (57,072 | ) | ||||
Total shareholders’ equity | 4,183,173 | 4,252,065 | ||||||
Noncontrolling interests | 400,302 | 401,403 | ||||||
Total equity | 4,583,475 | 4,653,468 | ||||||
Total liabilities and equity | $ | 9,115,852 | $ | 9,263,379 |
Three Months Ended March 31, | |||||||||
2019 | 2018 | ||||||||
Operating revenues | |||||||||
Contract drilling services | $ | 270,501 | $ | 229,106 | |||||
Reimbursables and other | 12,387 | 6,050 | |||||||
282,888 | 235,156 | ||||||||
Operating costs and expenses | |||||||||
Contract drilling services | 170,862 | 136,406 | |||||||
Reimbursables | 9,395 | 4,350 | |||||||
Depreciation and amortization | 108,772 | 127,639 | |||||||
General and administrative | 7,595 | 13,457 | |||||||
296,624 | 281,852 | ||||||||
Operating loss | (13,736 | ) | (46,696 | ) | |||||
Other income (expense) | |||||||||
Interest expense, net of amounts capitalized | (70,244 | ) | (76,015 | ) | |||||
Gain (loss) on extinguishment of debt, net | 31,266 | (8,768 | ) | ||||||
Interest income and other, net | 2,506 | 1,346 | |||||||
Loss from continuing operations before income taxes | (50,208 | ) | (130,133 | ) | |||||
Income tax provision | (2,865 | ) | (2,996 | ) | |||||
Net loss from continuing operations | (53,073 | ) | (133,129 | ) | |||||
Net loss from discontinued operations, net of tax | (3,821 | ) | — | ||||||
Net loss | (56,894 | ) | (133,129 | ) | |||||
Net (income) loss attributable to noncontrolling interests | (3,919 | ) | 986 | ||||||
Net loss attributable to Noble Corporation | $ | (60,813 | ) | $ | (132,143 | ) |
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Net loss | $ | (56,894 | ) | $ | (133,129 | ) | ||
Other comprehensive income (loss) | ||||||||
Foreign currency translation adjustments | 508 | 667 | ||||||
Foreign currency forward contracts | — | — | ||||||
Amortization of deferred pension plan amounts (net of tax provision of $145 and $87 for the three months ended March 31, 2019 and 2018, respectively) | 550 | 324 | ||||||
Other comprehensive income, net | 1,058 | 991 | ||||||
Net comprehensive (income) loss attributable to noncontrolling interests | (3,919 | ) | 986 | |||||
Comprehensive loss attributable to Noble Corporation | $ | (59,755 | ) | $ | (131,152 | ) |
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Cash flows from operating activities | ||||||||
Net loss | $ | (56,894 | ) | $ | (133,129 | ) | ||
Adjustments to reconcile net loss to net cash flow from operating activities: | ||||||||
Depreciation and amortization | 108,772 | 127,639 | ||||||
(Gain) loss on extinguishment of debt, net | (31,266 | ) | 8,768 | |||||
Deferred income taxes | 2,208 | (4,906 | ) | |||||
Amortization of share-based compensation | 2,940 | 6,282 | ||||||
Other costs, net | (3,264 | ) | 3,626 | |||||
Changes in components of working capital: | ||||||||
Change in taxes receivable | 4,195 | 84,486 | ||||||
Net changes in other operating assets and liabilities | (57,373 | ) | (27,869 | ) | ||||
Net cash provided by (used in) operating activities | (30,682 | ) | 64,897 | |||||
Cash flows from investing activities | ||||||||
Capital expenditures | (96,793 | ) | (33,816 | ) | ||||
Proceeds from disposal of assets, net | 7,930 | 117 | ||||||
Net cash used in investing activities | (88,863 | ) | (33,699 | ) | ||||
Cash flows from financing activities | ||||||||
Issuance of senior notes | — | 750,000 | ||||||
Borrowings on credit facilities | 350,000 | — | ||||||
Repayments of debt | (400,000 | ) | (952,209 | ) | ||||
Debt issuance costs | (90 | ) | (14,184 | ) | ||||
Dividends paid to noncontrolling interests | (5,020 | ) | (2,667 | ) | ||||
Distributions to parent company, net | (12,077 | ) | (13,318 | ) | ||||
Net cash used in financing activities | (67,187 | ) | (232,378 | ) | ||||
Net decrease in cash, cash equivalents and restricted cash | (186,732 | ) | (201,180 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 375,050 | 662,011 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 188,318 | $ | 460,831 |
Shares | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||
Balance | Par Value | ||||||||||||||||||||||||||
Balance at December 31, 2017 | 261,246 | $ | 26,125 | $ | 623,137 | $ | 4,669,173 | $ | (42,888 | ) | $ | 674,467 | $ | 5,950,014 | |||||||||||||
Tax effect of intra-entity asset transfers | — | — | — | (148,393 | ) | — | — | (148,393 | ) | ||||||||||||||||||
Stranded tax effect resulting from the Tax Cuts and Jobs Act | — | — | — | 5,540 | (5,540 | ) | — | — | |||||||||||||||||||
Adjustment for adopting the revenue recognition standard | — | — | — | (1,488 | ) | — | — | (1,488 | ) | ||||||||||||||||||
Balance at January 1, 2018 | 261,246 | 26,125 | 623,137 | 4,524,832 | (48,428 | ) | 674,467 | 5,800,133 | |||||||||||||||||||
Distributions to parent company, net | — | — | — | (13,318 | ) | — | — | (13,318 | ) | ||||||||||||||||||
Capital contribution by parent - share-based compensation | — | — | 6,282 | — | — | — | 6,282 | ||||||||||||||||||||
Net income (loss) | — | — | — | (132,143 | ) | — | (986 | ) | (133,129 | ) | |||||||||||||||||
Dividends paid to noncontrolling interests | — | — | — | — | — | (2,667 | ) | (2,667 | ) | ||||||||||||||||||
Other comprehensive income, net | — | — | — | — | 991 | — | 991 | ||||||||||||||||||||
Balance at March 31, 2018 | 261,246 | $ | 26,125 | $ | 629,419 | $ | 4,379,371 | $ | (47,437 | ) | $ | 670,814 | $ | 5,658,292 | |||||||||||||
Balance at December 31, 2018 | 261,246 | $ | 26,125 | $ | 647,082 | $ | 3,635,930 | $ | (57,072 | ) | $ | 401,403 | $ | 4,653,468 | |||||||||||||
Distributions to parent company, net | — | — | — | (12,077 | ) | — | — | (12,077 | ) | ||||||||||||||||||
Capital contribution by parent - share-based compensation | — | — | 2,940 | — | — | — | 2,940 | ||||||||||||||||||||
Net income (loss) | — | — | — | (60,813 | ) | — | 3,919 | (56,894 | ) | ||||||||||||||||||
Dividends paid to noncontrolling interests | — | — | — | — | — | (5,020 | ) | (5,020 | ) | ||||||||||||||||||
Other comprehensive income, net | — | — | — | — | 1,058 | — | 1,058 | ||||||||||||||||||||
Balance at March 31, 2019 | 261,246 | $ | 26,125 | $ | 650,022 | $ | 3,563,040 | $ | (56,014 | ) | $ | 400,302 | $ | 4,583,475 |
Three Months Ended March 31, | ||||||||
2019 | 2018 | |||||||
Numerator: | ||||||||
Basic | ||||||||
Net loss from continuing operations | $ | (67,068 | ) | $ | (142,334 | ) | ||
Net loss from discontinued operations, net of tax | (3,821 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (70,889 | ) | $ | (142,334 | ) | ||
Diluted | ||||||||
Net loss from continuing operations | $ | (67,068 | ) | $ | (142,334 | ) | ||
Net loss from discontinued operations, net of tax | (3,821 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (70,889 | ) | $ | (142,334 | ) | ||
Denominator: | ||||||||
Weighted average shares outstanding - basic | 248,251 | 246,175 | ||||||
Weighted average shares outstanding - diluted | 248,251 | 246,175 | ||||||
Loss per share | ||||||||
Basic: | ||||||||
Loss from continuing operations | $ | (0.27 | ) | $ | (0.58 | ) | ||
Loss from discontinued operations | (0.02 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (0.29 | ) | $ | (0.58 | ) | ||
Diluted: | ||||||||
Loss from continuing operations | $ | (0.27 | ) | $ | (0.58 | ) | ||
Loss from discontinued operations | (0.02 | ) | — | |||||
Net loss attributable to Noble Corporation plc | $ | (0.29 | ) | $ | (0.58 | ) |
March 31, 2019 | December 31, 2018 | |||||||
Drilling equipment and facilities | $ | 10,497,161 | $ | 10,546,376 | ||||
Construction in progress | 318,700 | 209,091 | ||||||
Other | 201,420 | 200,945 | ||||||
Property and equipment, at cost | $ | 11,017,281 | $ | 10,956,412 |
March 31, 2019 | December 31, 2018 | |||||||||||||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||||||||||
Senior unsecured notes: | ||||||||||||||||
4.90% Senior Notes due August 2020 | $ | 62,468 | $ | 60,066 | $ | 65,810 | $ | 60,177 | ||||||||
4.625% Senior Notes due March 2021 | 79,803 | 77,696 | 92,967 | 84,931 | ||||||||||||
3.95% Senior Notes due March 2022 | 21,171 | 19,213 | 41,617 | 37,096 | ||||||||||||
7.75% Senior Notes due January 2024 | 388,710 | 358,561 | 783,350 | 613,719 | ||||||||||||
7.95% Senior Notes due April 2025 | 446,626 | 388,917 | 446,517 | 339,035 | ||||||||||||
7.875% Senior Notes due February 2026 | 738,389 | 699,773 | 738,075 | 647,085 | ||||||||||||
6.20% Senior Notes due August 2040 | 390,472 | 251,079 | 390,454 | 245,242 | ||||||||||||
6.05% Senior Notes due March 2041 | 389,722 | 250,770 | 389,693 | 247,171 | ||||||||||||
5.25% Senior Notes due March 2042 | 478,028 | 293,770 | 477,996 | 277,056 | ||||||||||||
8.95% Senior Notes due April 2045 | 390,694 | 316,960 | 390,672 | 311,392 | ||||||||||||
Seller loans: | ||||||||||||||||
Seller-financed secured loan due September 2022 | 60,983 | 59,363 | 60,251 | 57,902 | ||||||||||||
Seller-financed secured loan due February 2023 | 53,725 | 50,516 | — | — | ||||||||||||
Credit facilities: | ||||||||||||||||
2015 Credit Facility matures January 2020 | 300,000 | 300,000 | — | — | ||||||||||||
2017 Credit Facility matures January 2023 | 50,000 | 50,000 | — | — | ||||||||||||
Total debt | 3,850,791 | 3,176,684 | 3,877,402 | 2,920,806 | ||||||||||||
Less: Current maturities of long-term debt | (300,000 | ) | (300,000 | ) | — | — | ||||||||||
Long-term debt | $ | 3,550,791 | $ | 2,876,684 | $ | 3,877,402 | $ | 2,920,806 |
Defined Benefit Pension Items (1) | Foreign Currency Items | Total | ||||||||||
Balance at December 31, 2017 | $ | (27,603 | ) | $ | (15,285 | ) | $ | (42,888 | ) | |||
Activity during period: | ||||||||||||
Stranded tax effect resulting from the Tax Cuts and Jobs Act | (5,540 | ) | — | (5,540 | ) | |||||||
Balance at January 1, 2018 | (33,143 | ) | (15,285 | ) | (48,428 | ) | ||||||
Activity during period: | ||||||||||||
Other comprehensive income before reclassifications | — | 667 | 667 | |||||||||
Amounts reclassified from AOCI | 324 | — | 324 | |||||||||
Net other comprehensive income | 324 | 667 | 991 | |||||||||
Balance at March 31, 2018 | $ | (32,819 | ) | $ | (14,618 | ) | $ | (47,437 | ) | |||
Balance at December 31, 2018 | $ | (39,058 | ) | $ | (18,014 | ) | $ | (57,072 | ) | |||
Activity during period: | ||||||||||||
Other comprehensive loss before reclassifications | — | 508 | 508 | |||||||||
Amounts reclassified from AOCI | 550 | — | 550 | |||||||||
Net other comprehensive income (loss) | 550 | 508 | 1,058 | |||||||||
Balance at March 31, 2019 | $ | (38,508 | ) | $ | (17,506 | ) | $ | (56,014 | ) |
(1) | Defined benefit pension items relate to actuarial changes. Reclassifications from AOCI are recognized as expense on our Condensed Consolidated Statements of Operations through “General and administrative.” See “Note 11— Employee Benefit Plans” for additional information. |
March 31, 2019 | December 31, 2018 | |||||||
Current contract assets | $ | 20,824 | $ | 25,298 | ||||
Noncurrent contract assets | 18,438 | 22,366 | ||||||
Total contract assets | 39,262 | 47,664 | ||||||
Current contract liabilities (deferred revenue) | (29,325 | ) | (32,906 | ) | ||||
Noncurrent contract liabilities (deferred revenue) | (42,939 | ) | (47,847 | ) | ||||
Total contract liabilities | $ | (72,264 | ) | $ | (80,753 | ) |
Contract Assets | Contract Liabilities | |||||||
Net balance at December 31, 2018 | $ | 47,664 | $ | (80,753 | ) | |||
Amortization of deferred costs | (8,775 | ) | — | |||||
Additions to deferred costs | 373 | — | ||||||
Amortization of deferred revenue | — | 9,355 | ||||||
Additions to deferred revenue | — | (866 | ) | |||||
Total | (8,402 | ) | 8,489 | |||||
Net balance at March 31, 2019 | $ | 39,262 | $ | (72,264 | ) |
Three Months Ended March 31, 2019 | ||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | 2023 and beyond | Total | |||||||||||||||||||
Floaters | $ | 15,598 | $ | 16,073 | $ | 15,757 | $ | 9,255 | $ | 3,568 | $ | 60,251 | ||||||||||||
Jackups | 8,352 | 3,661 | — | — | — | 12,013 | ||||||||||||||||||
Total | $ | 23,950 | $ | 19,734 | $ | 15,757 | $ | 9,255 | $ | 3,568 | $ | 72,264 |
Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | |||||||
Floaters | $ | 153,154 | 120,636 | |||||
Jackups | 117,347 | 108,470 | ||||||
Total | $ | 270,501 | $ | 229,106 |
March 31, 2019 | ||||
Operating Leases | ||||
Operating lease right-of-use assets | $ | 28,272 | ||
Current operating lease liabilities | 4,396 | |||
Long-term operating lease liabilities | $ | 23,243 |
Weighted average remaining lease term for operating leases (years) | 9.1 | ||
Weighted average discounted rate for operating leases | 9.6 | % |
March 31, 2019 | ||||
Operating lease cost | $ | 1,859 | ||
Short-term lease cost | 2,052 | |||
Variable lease cost | 529 | |||
Total lease cost | $ | 4,440 |
March 31, 2019 | ||||
Cash paid for amounts included in the measurement of lease liabilities | ||||
Operating cash flows from operating leases | $ | 2,200 |
Operating Leases | ||||
2019 | $ | 4,814 | ||
2020 | 5,917 | |||
2021 | 4,448 | |||
2022 | 3,618 | |||
2023 | 3,250 | |||
Thereafter | 22,335 | |||
Total lease payments | 44,382 | |||
Less: Interest | (16,743 | ) | ||
Present value of lease liability | $ | 27,639 |
Three Months Ended March 31, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
Non-U.S. | U.S. | Non-U.S. | U.S. | |||||||||||||
Interest cost | $ | 445 | $ | 2,178 | $ | 465 | $ | 2,045 | ||||||||
Return on plan assets | (634 | ) | (2,578 | ) | (716 | ) | (2,979 | ) | ||||||||
Recognized net actuarial gain | 3 | 692 | — | 411 | ||||||||||||
Net pension benefit cost (gain) | $ | (186 | ) | $ | 292 | $ | (251 | ) | $ | (523 | ) |
March 31, 2019 | ||||||||||||||||
Estimated Fair Value Measurements | ||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Assets - | ||||||||||||||||
Marketable securities | $ | 7,359 | $ | 7,359 | $ | — | $ | — |
December 31, 2018 | ||||||||||||||||
Estimated Fair Value Measurements | ||||||||||||||||
Carrying Amount | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Assets - | ||||||||||||||||
Marketable securities | $ | 8,659 | $ | 8,659 | $ | — | $ | — |
Noble-UK | Noble-Cayman | |||||||||||||||
Three Months Ended March 31, | Three Months Ended March 31, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Accounts receivable | $ | (11,007 | ) | $ | 22,892 | $ | (11,007 | ) | $ | 22,892 | ||||||
Other current assets | 17,097 | 9,986 | 16,803 | 9,699 | ||||||||||||
Other assets | 3,700 | (11,668 | ) | 4,506 | (10,552 | ) | ||||||||||
Accounts payable | (1,867 | ) | 6,175 | (1,676 | ) | 6,175 | ||||||||||
Other current liabilities | (59,685 | ) | (58,860 | ) | (59,544 | ) | (58,780 | ) | ||||||||
Other liabilities | (6,455 | ) | 2,697 | (6,455 | ) | 2,697 | ||||||||||
Total net change in assets and liabilities | $ | (58,217 | ) | $ | (28,778 | ) | $ | (57,373 | ) | $ | (27,869 | ) |
Issuer | ||||
Notes (1) | (Co-Issuer(s)) | Guarantor | ||
4.90% Senior Notes due 2020 | NHIL | Noble-Cayman | ||
4.625% Senior Notes due 2021 | NHIL | Noble-Cayman | ||
3.95% Senior Notes due 2022 | NHIL | Noble-Cayman | ||
7.75% Senior Notes due 2024 | NHIL | Noble-Cayman | ||
7.95% Senior Notes due 2025 | NHIL | Noble-Cayman | ||
6.20% Senior Notes due 2040 | NHIL | Noble-Cayman | ||
6.05% Senior Notes due 2041 | NHIL | Noble-Cayman | ||
5.25% Senior Notes due 2042 | NHIL | Noble-Cayman | ||
8.95% Senior Notes due 2045 | NHIL | Noble-Cayman |
Noble - Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash and cash equivalents | $ | 1 | $ | — | $ | 187,014 | $ | — | $ | 187,015 | ||||||||||
Accounts receivable | — | — | 211,729 | — | 211,729 | |||||||||||||||
Taxes receivable | — | — | 16,303 | — | 16,303 | |||||||||||||||
Accounts receivable from affiliates | 743,538 | 61,045 | 5,113,199 | (5,917,782 | ) | — | ||||||||||||||
Prepaid expenses and other current assets | 468 | — | 45,133 | — | 45,601 | |||||||||||||||
Total current assets | 744,007 | 61,045 | 5,573,378 | (5,917,782 | ) | 460,648 | ||||||||||||||
Property and equipment, at cost | — | — | 11,017,281 | — | 11,017,281 | |||||||||||||||
Accumulated depreciation | — | — | (2,510,699 | ) | — | (2,510,699 | ) | |||||||||||||
Property and equipment, net | — | — | 8,506,582 | — | 8,506,582 | |||||||||||||||
Notes receivable from affiliates | 5,145 | — | 43,000 | (48,145 | ) | — | ||||||||||||||
Investments in affiliates | 7,656,540 | 8,787,194 | — | (16,443,734 | ) | — | ||||||||||||||
Other assets | — | — | 148,622 | — | 148,622 | |||||||||||||||
Total assets | $ | 8,405,692 | $ | 8,848,239 | $ | 14,271,582 | $ | (22,409,661 | ) | $ | 9,115,852 | |||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Current maturities of long-term debt | 300,000 | — | — | — | 300,000 | |||||||||||||||
Accounts payable | 39 | 63 | 110,813 | — | 110,915 | |||||||||||||||
Accrued payroll and related costs | — | — | 34,867 | — | 34,867 | |||||||||||||||
Accounts payable to affiliates | 3,901,507 | 1,211,694 | 804,581 | (5,917,782 | ) | — | ||||||||||||||
Taxes payable | — | — | 26,482 | — | 26,482 | |||||||||||||||
Interest payable | 1,044 | 60,170 | 2,987 | — | 64,201 | |||||||||||||||
Other current liabilities | — | — | 59,038 | — | 59,038 | |||||||||||||||
Total current liabilities | 4,202,590 | 1,271,927 | 1,038,768 | (5,917,782 | ) | 595,503 | ||||||||||||||
Long-term debt | — | 3,386,083 | 164,708 | — | 3,550,791 | |||||||||||||||
Notes payable to affiliates | — | 43,000 | 5,145 | (48,145 | ) | — | ||||||||||||||
Deferred income taxes | — | — | 81,009 | — | 81,009 | |||||||||||||||
Other liabilities | 19,929 | — | 285,145 | — | 305,074 | |||||||||||||||
Total liabilities | 4,222,519 | 4,701,010 | 1,574,775 | (5,965,927 | ) | 4,532,377 | ||||||||||||||
Commitments and contingencies | ||||||||||||||||||||
Shareholders’ equity | 4,183,173 | 4,147,229 | 12,296,505 | (16,443,734 | ) | 4,183,173 | ||||||||||||||
Noncontrolling interests | — | — | 400,302 | — | 400,302 | |||||||||||||||
Total equity | 4,183,173 | 4,147,229 | 12,696,807 | (16,443,734 | ) | 4,583,475 | ||||||||||||||
Total liabilities and equity | $ | 8,405,692 | $ | 8,848,239 | $ | 14,271,582 | $ | (22,409,661 | ) | $ | 9,115,852 |
Noble- Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 17,818 | $ | 356,557 | $ | — | $ | 374,375 | ||||||||||
Accounts receivable | — | — | 200,722 | — | 200,722 | |||||||||||||||
Taxes receivable | — | — | 20,498 | — | 20,498 | |||||||||||||||
Short-term notes receivable from affiliates | — | — | 3,175,662 | (3,175,662 | ) | — | ||||||||||||||
Accounts receivable from affiliates | 275,726 | 61,046 | 4,823,902 | (5,160,674 | ) | — | ||||||||||||||
Prepaid expenses and other current assets | — | — | 61,917 | — | 61,917 | |||||||||||||||
Total current assets | 275,726 | 78,864 | 8,639,258 | (8,336,336 | ) | 657,512 | ||||||||||||||
Property and equipment, at cost | — | — | 10,956,412 | — | 10,956,412 | |||||||||||||||
Accumulated depreciation | — | — | (2,475,694 | ) | — | (2,475,694 | ) | |||||||||||||
Property and equipment, net | — | — | 8,480,718 | — | 8,480,718 | |||||||||||||||
Notes receivable from affiliates | 5,145 | — | — | (5,145 | ) | — | ||||||||||||||
Investments in affiliates | 7,716,068 | 12,300,840 | — | (20,016,908 | ) | — | ||||||||||||||
Other assets | 609 | — | 124,540 | — | 125,149 | |||||||||||||||
Total assets | $ | 7,997,548 | $ | 12,379,704 | $ | 17,244,516 | $ | (28,358,389 | ) | $ | 9,263,379 | |||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Short-term notes payables to affiliates | $ | — | $ | 3,175,662 | $ | — | $ | (3,175,662 | ) | $ | — | |||||||||
Accounts payable | 45 | — | 125,192 | — | 125,237 | |||||||||||||||
Accrued payroll and related costs | — | — | 50,284 | — | 50,284 | |||||||||||||||
Accounts payable to affiliates | 3,725,506 | 1,098,395 | 336,773 | (5,160,674 | ) | — | ||||||||||||||
Taxes payable | — | — | 29,386 | — | 29,386 | |||||||||||||||
Interest payable | 3 | 99,997 | 100 | — | 100,100 | |||||||||||||||
Other current liabilities | — | — | 60,012 | — | 60,012 | |||||||||||||||
Total current liabilities | 3,725,554 | 4,374,054 | 601,747 | (8,336,336 | ) | 365,019 | ||||||||||||||
Long-term debt | — | 3,817,153 | 60,249 | — | 3,877,402 | |||||||||||||||
Notes payable to affiliates | — | — | 5,145 | (5,145 | ) | — | ||||||||||||||
Deferred income taxes | — | — | 91,695 | — | 91,695 | |||||||||||||||
Other liabilities | 19,929 | — | 255,866 | — | 275,795 | |||||||||||||||
Total liabilities | 3,745,483 | 8,191,207 | 1,014,702 | (8,341,481 | ) | 4,609,911 | ||||||||||||||
Commitments and contingencies | ||||||||||||||||||||
Shareholders’ equity | 4,252,065 | 4,188,497 | 15,828,411 | (20,016,908 | ) | 4,252,065 | ||||||||||||||
Noncontrolling interests | — | — | 401,403 | — | 401,403 | |||||||||||||||
Total equity | 4,252,065 | 4,188,497 | 16,229,814 | (20,016,908 | ) | 4,653,468 | ||||||||||||||
Total liabilities and equity | $ | 7,997,548 | $ | 12,379,704 | $ | 17,244,516 | $ | (28,358,389 | ) | $ | 9,263,379 |
Noble- Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
Operating revenues | ||||||||||||||||||||
Contract drilling services | $ | — | $ | — | $ | 270,501 | $ | — | $ | 270,501 | ||||||||||
Reimbursables and other | — | — | 12,387 | — | 12,387 | |||||||||||||||
Total operating revenues | — | — | 282,888 | — | 282,888 | |||||||||||||||
Operating costs and expenses | ||||||||||||||||||||
Contract drilling services | 35 | — | 170,827 | — | 170,862 | |||||||||||||||
Reimbursables | — | — | 9,395 | — | 9,395 | |||||||||||||||
Depreciation and amortization | — | — | 108,772 | — | 108,772 | |||||||||||||||
General and administrative | — | 3 | 7,592 | — | 7,595 | |||||||||||||||
Total operating costs and expenses | 35 | 3 | 296,586 | — | 296,624 | |||||||||||||||
Operating loss | (35 | ) | (3 | ) | (13,698 | ) | — | (13,736 | ) | |||||||||||
Other income (expense) | ||||||||||||||||||||
Income (loss) of unconsolidated affiliates | (55,708 | ) | 2,184 | — | 53,524 | — | ||||||||||||||
Income (loss) of unconsolidated affiliates - discontinued operations, net of tax | (3,821 | ) | (3,821 | ) | — | 7,642 | — | |||||||||||||
Interest expense, net of amounts capitalized | (1,318 | ) | (71,577 | ) | (2,228 | ) | 4,879 | (70,244 | ) | |||||||||||
Gain on extinguishment of debt, net | — | 31,266 | — | — | 31,266 | |||||||||||||||
Interest income and other, net | 69 | (7 | ) | 7,323 | (4,879 | ) | 2,506 | |||||||||||||
Income (loss) before income taxes | (60,813 | ) | (41,958 | ) | (8,603 | ) | 61,166 | (50,208 | ) | |||||||||||
Income tax benefit | — | — | (2,865 | ) | — | (2,865 | ) | |||||||||||||
Net income (loss) from continuing operations | (60,813 | ) | (41,958 | ) | (11,468 | ) | 61,166 | (53,073 | ) | |||||||||||
Net income (loss) from discontinued operations | — | — | (3,821 | ) | — | (3,821 | ) | |||||||||||||
Net income (loss) | (60,813 | ) | (41,958 | ) | (15,289 | ) | 61,166 | (56,894 | ) | |||||||||||
Net (income) loss attributable to noncontrolling interests | — | — | (3,919 | ) | — | (3,919 | ) | |||||||||||||
Net income (loss) attributable to Noble Corporation | (60,813 | ) | (41,958 | ) | (19,208 | ) | 61,166 | (60,813 | ) | |||||||||||
Other comprehensive income (loss), net | 1,058 | — | 1,058 | (1,058 | ) | 1,058 | ||||||||||||||
Comprehensive income (loss) attributable to Noble Corporation | $ | (59,755 | ) | $ | (41,958 | ) | $ | (18,150 | ) | $ | 60,108 | $ | (59,755 | ) |
Noble- Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
Operating revenues | ||||||||||||||||||||
Contract drilling services | $ | — | $ | — | $ | 229,106 | $ | — | $ | 229,106 | ||||||||||
Reimbursables and other | — | — | 6,050 | — | 6,050 | |||||||||||||||
Total operating revenues | — | — | 235,156 | — | 235,156 | |||||||||||||||
Operating costs and expenses | ||||||||||||||||||||
Contract drilling services | 81 | 604 | 135,721 | — | 136,406 | |||||||||||||||
Reimbursables | — | — | 4,350 | — | 4,350 | |||||||||||||||
Depreciation and amortization | — | — | 127,639 | — | 127,639 | |||||||||||||||
General and administrative | 33 | 618 | 12,806 | — | 13,457 | |||||||||||||||
Total operating costs and expenses | 114 | 1,222 | 280,516 | — | 281,852 | |||||||||||||||
Operating loss | (114 | ) | (1,222 | ) | (45,360 | ) | — | (46,696 | ) | |||||||||||
Other income (expense) | ||||||||||||||||||||
Income (loss) of unconsolidated affiliates | (130,816 | ) | 12,518 | — | 118,298 | — | ||||||||||||||
Interest expense, net of amounts capitalized | (445 | ) | (119,821 | ) | — | 44,251 | (76,015 | ) | ||||||||||||
Gain (loss) on extinguishment of debt, net | (2,336 | ) | 5,419 | (11,851 | ) | — | (8,768 | ) | ||||||||||||
Interest income and other, net | 1,568 | (129 | ) | 44,158 | (44,251 | ) | 1,346 | |||||||||||||
Income (loss) before income taxes | (132,143 | ) | (103,235 | ) | (13,053 | ) | 118,298 | (130,133 | ) | |||||||||||
Income tax benefit | — | — | (2,996 | ) | — | (2,996 | ) | |||||||||||||
Net income (loss) | (132,143 | ) | (103,235 | ) | (16,049 | ) | 118,298 | (133,129 | ) | |||||||||||
Net (income) loss attributable to noncontrolling interests | — | — | 986 | — | 986 | |||||||||||||||
Net income (loss) attributable to Noble Corporation | (132,143 | ) | (103,235 | ) | (15,063 | ) | 118,298 | (132,143 | ) | |||||||||||
Other comprehensive income (loss), net | 991 | — | 991 | (991 | ) | 991 | ||||||||||||||
Comprehensive income (loss) attributable to Noble Corporation | $ | (131,152 | ) | $ | (103,235 | ) | $ | (14,072 | ) | $ | 117,307 | $ | (131,152 | ) |
Noble- Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 2,973 | $ | (110,170 | ) | $ | 76,515 | $ | — | $ | (30,682 | ) | ||||||||
Cash flows from investing activities | ||||||||||||||||||||
Capital expenditures | — | — | (96,793 | ) | — | (96,793 | ) | |||||||||||||
Proceeds from disposal of assets | — | — | 7,930 | — | 7,930 | |||||||||||||||
Notes receivable from affiliates | (43,000 | ) | 43,000 | — | ||||||||||||||||
Net cash provided by (used in) investing activities | — | — | (131,863 | ) | 43,000 | (88,863 | ) | |||||||||||||
Cash flows from financing activities | ||||||||||||||||||||
Borrowings on credit facilities | 300,000 | — | 50,000 | — | 350,000 | |||||||||||||||
Repayment of long-term debt | — | (400,000 | ) | — | — | (400,000 | ) | |||||||||||||
Debt issuance costs | — | — | (90 | ) | — | (90 | ) | |||||||||||||
Dividends paid to noncontrolling interests | — | — | (5,020 | ) | — | (5,020 | ) | |||||||||||||
Distributions to parent company, net | (12,077 | ) | — | — | — | (12,077 | ) | |||||||||||||
Advances (to) from affiliates | (290,895 | ) | 449,352 | (158,457 | ) | — | — | |||||||||||||
Notes payable to affiliates | — | 43,000 | — | (43,000 | ) | — | ||||||||||||||
Net cash provided by (used in) financing activities | (2,972 | ) | 92,352 | (113,567 | ) | (43,000 | ) | (67,187 | ) | |||||||||||
Net change in cash, cash equivalents and restricted cash | 1 | (17,818 | ) | (168,915 | ) | — | (186,732 | ) | ||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | — | 17,818 | 357,232 | — | 375,050 | |||||||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 1 | $ | — | $ | 188,317 | $ | — | $ | 188,318 |
Noble- Cayman | NHIL | Other Non-guarantor Subsidiaries of Noble | Consolidating Adjustments | Total | ||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 7,313 | $ | (135,393 | ) | $ | 192,977 | $ | — | $ | 64,897 | |||||||||
Cash flows from investing activities | ||||||||||||||||||||
Capital expenditures | — | — | (33,816 | ) | — | (33,816 | ) | |||||||||||||
Proceeds from disposal of assets | — | — | 117 | — | 117 | |||||||||||||||
Net cash used in investing activities | — | — | (33,699 | ) | — | (33,699 | ) | |||||||||||||
Cash flows from financing activities | ||||||||||||||||||||
Repayment of long-term debt | — | (738,555 | ) | (213,654 | ) | — | (952,209 | ) | ||||||||||||
Issuance of senior notes | — | 750,000 | — | — | 750,000 | |||||||||||||||
Debt issuance costs | (217 | ) | (12,581 | ) | (1,386 | ) | — | (14,184 | ) | |||||||||||
Dividends paid to noncontrolling interests | — | — | (2,667 | ) | — | (2,667 | ) | |||||||||||||
Distribution to parent company, net | (13,318 | ) | — | — | — | (13,318 | ) | |||||||||||||
Advances (to) from affiliates | 6,221 | 147,567 | (153,788 | ) | — | — | ||||||||||||||
Net cash provided by (used in) financing activities | (7,314 | ) | 146,431 | (371,495 | ) | — | (232,378 | ) | ||||||||||||
Net change in cash, cash equivalents and restricted cash | (1 | ) | 11,038 | (212,217 | ) | — | (201,180 | ) | ||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | 11 | 29,324 | 632,676 | — | 662,011 | |||||||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 10 | $ | 40,362 | $ | 420,459 | $ | — | $ | 460,831 |
• | sustained crude oil prices; |
• | improved geologic success with regard to our customers’ exploration efforts; |
• | greater customer access to areas with promising offshore resource potential; |
• | advances in offshore technological applications which reduce offshore costs and improve project economics; |
• | high rate of natural depletion relating to land-based sources of crude oil production; |
• | deteriorating annual production and poor reserve replacement metrics caused, in part, by a period of sustained under-investment by our customers; and |
• | declining supply of rigs due to continued attrition. |
Year Ending December 31, | ||||||||||||||||||||||||
Total | 2019 (1) | 2020 | 2021 | 2022 | 2023 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Contract Drilling Services Backlog | ||||||||||||||||||||||||
Floaters (2)(3) | $ | 1,373,147 | $ | 373,525 | $ | 404,767 | $ | 338,025 | $ | 187,255 | $ | 69,575 | ||||||||||||
Jackups | 899,825 | 352,803 | 313,677 | 166,805 | 66,540 | — | ||||||||||||||||||
Total (4) | $ | 2,272,972 | $ | 726,328 | $ | 718,444 | $ | 504,830 | $ | 253,795 | $ | 69,575 | ||||||||||||
Percent of Available Days Committed (5) | ||||||||||||||||||||||||
Floaters | 53 | % | 37 | % | 27 | % | 15 | % | 6 | % | ||||||||||||||
Jackups | 75 | % | 43 | % | 31 | % | 13 | % | — | % | ||||||||||||||
Total | 64 | % | 40 | % | 29 | % | 14 | % | 3 | % |
(1) | Represents a nine-month period beginning April 1, 2019. The backlog figure and days committed to contracts exclude the contract extension with Talos and the new one-year award with Exxon Mobil (Esso) for the Noble Don Taylor and excludes the contract extensions received for the Noble Joe Beall and Noble Sam Hartley, all of which were secured in April 2019. |
(2) | As previously reported, three of our long-term drilling contracts with Shell, the Noble Bully II, Noble Globetrotter I and Noble Globetrotter II, contain a dayrate adjustment mechanism that utilizes an average of market rates that match a set of distinct technical attributes and is subject to a modest discount, beginning on the fifth-year anniversary of the contract and continuing every six months thereafter. On December 12, 2016, we amended those drilling contracts with Shell. As a result of the amendments, each of the contracts now has a contractual dayrate floor. The contract amendments for the Noble Globetrotter I and Noble Globetrotter II provide a dayrate floor of $275,000 per day. The Noble Bully II contract contains a dayrate floor of $200,000 per day plus daily operating expenses. The amendment also provided Shell the right to idle the Noble Bully II for up to one year at a special stacking rate. The Noble Bully II was idled at a rate of $200,000 per day, effective April 3, 2017. In April 2018, we agreed with Shell to extend the idle period for the Noble Bully II through December 31, 2018 at a revised rate of $230,000 per day. Once the dayrate adjustment mechanism becomes effective and following any idle periods, the dayrate for these rigs will not be lower than the higher of (i) the contractual dayrate floor or (ii) the market rate as calculated under the adjustment mechanism. The impact to contract backlog from these amendments has been reflected in the table above and the backlog calculation assumes that, after any idle period at the contractual stacking rate, each rig will work at their respective dayrate floor for the remaining contract term. |
(3) | Noble and a subsidiary of Shell are involved in joint ventures that own and operate both the Noble Bully I and the Noble Bully II. Pursuant to these agreements, each party has an equal 50 percent share in both vessels. As of March 31, 2019, the backlog for the Noble Bully II totaled $375.0 million, all of which is included in backlog. As of the same date, the Noble Bully I had no backlog. Noble’s proportional interest in the backlog for these rigs totaled $187.5 million. |
(4) | Some of our drilling contracts provide the customers with certain early termination rights and, in limited cases, those termination rights require minimal or no notice and minimal financial penalties. |
(5) | Percent of available days committed is calculated by dividing the total number of days our rigs are operating under contract for such period by the product of the number of our rigs and the number of calendar days in such period. |
Average Rig Utilization (1) | Operating Days (2) | Average Dayrates | ||||||||||||||||||||||||
Three Months Ended March 31, | Three Months Ended March 31, | Three Months Ended March 31, | ||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||||||||
Jackups | 93 | % | 56 | % | 923 | 706 | 31 | % | $ | 127,150 | $ | 153,662 | (17 | )% | ||||||||||||
Floaters | 60 | % | 37 | % | 647 | 465 | 39 | % | 236,715 | 259,326 | (9 | )% | ||||||||||||||
Total | 76 | % | 47 | % | 1,570 | 1,171 | 34 | % | $ | 172,305 | $ | 195,633 | (12 | )% |
(1) | We define utilization for a specific period as the total number of days our rigs are operating under contract, divided by the product of the total number of our rigs, including cold stacked rigs, and the number of calendar days in such period. Information reflects our policy of reporting on the basis of the number of available rigs in our fleet, excluding newbuild rigs under construction. |
(2) | Information reflects the number of days that our rigs were operating under contract. |
Three Months Ended March 31, | Change | ||||||||||||||
2019 | 2018 | $ | % | ||||||||||||
Operating revenues: | |||||||||||||||
Contract drilling services | $ | 270,501 | $ | 229,106 | $ | 41,395 | 18 | % | |||||||
Reimbursables and other (1) | 12,387 | 6,051 | 6,336 | 105 | % | ||||||||||
282,888 | 235,157 | 47,731 | 20 | % | |||||||||||
Operating costs and expenses: | |||||||||||||||
Contract drilling services | 171,728 | 136,849 | 34,879 | 25 | % | ||||||||||
Reimbursables (1) | 9,395 | 4,350 | 5,045 | 116 | % | ||||||||||
Depreciation and amortization | 106,086 | 123,215 | (17,129 | ) | (14 | )% | |||||||||
General and administrative | 15,999 | 22,083 | (6,084 | ) | (28 | )% | |||||||||
303,208 | 286,497 | 16,711 | 6 | % | |||||||||||
Operating income (loss) | $ | (20,320 | ) | $ | (51,340 | ) | $ | 31,020 | (60 | )% |
(1) | We record reimbursements from customers for out-of-pocket expenses as operating revenues and the related direct costs as operating expenses. Changes in the amount of these reimbursables generally do not have a material effect on our financial position, results of operations or cash flows. |
• | normal recurring operating expenses; |
• | retirement of a portion of various tranches of our senior notes in tender offers; and |
• | capital expenditures. |
• | normal recurring operating expenses; |
• | planned and discretionary capital expenditures; and |
• | repayments of debt and interest. |
• | $7.6 million for sustaining capital; |
• | $41.1 million in major projects, including reactivations and subsea and other related projects; |
• | $83.8 million to purchase the Noble Joe Knight (inclusive of cash paid and seller financing); and |
• | $4.3 million in capitalized interest. |
• | $90.9 million for sustaining capital; |
• | $119.9 million in major projects, including reactivations and subsea and other related projects; |
• | $83.8 million purchase of the Noble Joe Knight; and |
• | $9.3 million in capitalized interest. |
Exhibit Number | Exhibit | |
2.1 | ||
2.2 | ||
2.3 | ||
3.1 | ||
3.2 | ||
10.1* | ||
10.2* | ||
10.3* | ||
10.4* | ||
10.5* | ||
10.6* | ||
31.1 | ||
31.2 | ||
32.1+ | ||
32.2+ |
Exhibit Number | Exhibit | |
101 | Interactive Data File |
* | Management contract or compensatory plan or arrangement. |
+ | Furnished in accordance with Item 601(b)(32)(ii) of Regulation S-K. |
/s/ Adam C. Peakes | May 2, 2019 | |
Adam C. Peakes Senior Vice President and Chief Financial Officer (Principal Financial Officer) | Date | |
/s/ Laura D. Campbell | May 2, 2019 | |
Laura D. Campbell Vice President and Controller (Principal Accounting Officer) | Date |
/s/ Adam C. Peakes | May 2, 2019 | |
Adam C. Peakes Director, Vice President and Chief Financial Officer (Principal Financial Officer) | Date | |
/s/ Laura D. Campbell | May 2, 2019 | |
Laura D. Campbell Vice President and Controller (Principal Accounting Officer) | Date |
• | Company EBITDA versus budget (weighted 70%) |
• | Company Safety goal result (weighted 20%) |
• | Company Environmental goal result (weighted 10%) |
Company EBITDA (70%) | ||||||
Level of Achievement | Threshold | Target | Maximum | |||
% of Target | 80% | 100% | 120% | |||
Bonus Pool Multiple | 0.50 | 1.00 | 2.00 |
Company Safety (20%) | ||
Level of Achievement | Bonus Pool Multiple | |
Top Quartile Performance & Year-Over-Year Improvement | 2.00 | |
Top Quartile Performance | 1.50 | |
Second Quartile Performance | 1.00 | |
Third Quartile Performance | 0.50 | |
Bottom Quartile Performance | — |
Company Environmental (10%) | ||||||
Level of Achievement | Threshold | Target | Maximum | |||
% of Target | 3.01 - 3.50 | 2.51 - 3.00 | ≤2.50% | |||
Bonus Pool Multiple | 0.50 | 1.00 | 2.00 |
Financial and Operating Goal Weighting Schedule | ||||
Goal | Corporate | Operations | ||
Company EBITDA | 70% | — | ||
Region Cash Operating Margin | — | 70% | ||
Company Safety | 20% | 10% | ||
Region Safety | — | 10% | ||
Company Environmental | 10% | 10% |
Plan Award Pool Calculation | ||||||
Goal | Multiple | Weighting | Factor | |||
Company EBITDA | 1.00 | x | 70% | = | 0.70 | |
Company Safety | 1.20 | x | 20% | = | 0.24 | |
Company Environmental | 1.00 | x | 10% | = | 0.10 | |
Combined Award Pool Multiple | 1.04 | |||||
Aggregate Target Bonuses | $15mm | |||||
Award Pool (1.04 x $15 mm) | $15.6mm |
Noble Corporation plc |
10 Brook Street |
London |
W1S IBG |
England |
Attention: Corporate Secretary |
Fax: 281-596 - 4486 |
With a copy to: |
Chairman of Compensation Committee |
c/o Noble Corporation plc |
London |
W1S IBG |
England |
Fax: 281-596 - 4486 |
NOBLE CORPORATION PLC |
TSR for the Performance Cycle | = | ((Ending Price - Beginning Price) + dividends and cash distributions per share paid*) ÷ Beginning Price |
* | Stock dividends paid in common equity securities rather than cash in which there is a distribution of less than 25 percent of the fully diluted outstanding shares (as calculated prior to the distribution) shall be treated as cash for purposes of this calculation. |
CDM-GA for the Performance Cycle | = | (Contract Drilling Margin* - G&A) ÷ Contract Drilling Revenues** |
• | ((50% + 200%) ÷ 2) = 125% (vesting percentage) |
• | 125% × 500 = 625 shares |
• | 500 × (7 ÷36) = 97 (rounded down, 403 remaining) |
• | ((50% + 200%) ÷ 2) = 125% (vesting percentage) |
• | 403 × 125% = 503 shares (rounded down) |
Noble Ranking Among Applicable Peer Group | Performance Percentage |
1 | 200% |
2 and 3 | Payout is interpolated between 50% and 200% based on Noble’s performance ranking relative to the companies in the 1st and 4th position |
4 | 50% |
5 | 0% |
Noble Corporation plc |
10 Brook Street |
London W1S IBG, England |
Attention: Corporate Secretary |
Fax: 281 -596 - 4486 |
With a copy to: |
Chairman of Compensation Committee |
c/o Noble Corporation plc |
10 Brook Street |
London W1S IBG, England |
Fax: 281 -596 - 4486 |
NOBLE CORPORATION PLC |
(i) | One-third of the Awarded Restricted Stock Units shall vest and no longer be subject to forfeiture on the first anniversary of the Effective Date; and |
(ii) | One-third of the Awarded Restricted Stock Units shall vest and no longer be subject to forfeiture on the second anniversary of the Effective Date; and |
(iii) | One-third of the Awarded Restricted Stock Units shall vest and no longer be subject to forfeiture on the third anniversary of the Effective Date. |
1. | I have reviewed this quarterly report on Form 10-Q of Noble Corporation plc and Noble Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors: |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Julie J. Robertson | May 2, 2019 | |
Julie J. Robertson | Date |
Chairman, President and Chief Executive Officer of Noble Corporation plc, a public limited company incorporated under the laws of England and Wales, and President and Chief Executive Officer of Noble Corporation, a Cayman Islands company |
1. | I have reviewed this quarterly report on Form 10-Q of Noble Corporation plc and Noble Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors: |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Adam C. Peakes | May 2, 2019 | |
Adam C. Peakes | Date |
Senior Vice President and Chief Financial Officer of Noble Corporation plc, a public limited company incorporated under the laws of England and Wales, and Director, Vice President and Chief Financial Officer of Noble Corporation, a Cayman Islands company |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
May 2, 2019 | /s/ Julie J. Robertson |
Julie J. Robertson | |
Chairman, President and Chief Executive Officer of Noble Corporation plc, a public limited company incorporated under the laws of England and Wales, and President and Chief Executive Officer of Noble Corporation, a Cayman Islands company |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
May 2, 2019 | /s/ Adam C. Peakes |
Adam C. Peakes | |
Senior Vice President and Chief Financial Officer of Noble Corporation plc, a public limited company incorporated under the laws of England and Wales, and Director, Vice President and Chief Financial Officer of Noble Corporation, a Cayman Islands company |
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Apr. 30, 2019 |
|
Document Information [Line Items] | ||
Entity Registrant Name | Noble Corp plc | |
Trading Symbol | NE | |
Entity Central Index Key | 0001458891 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 249,155,155 | |
Noble Corp | ||
Document Information [Line Items] | ||
Entity Registrant Name | Noble Corporation | |
Entity Central Index Key | 0001169055 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 261,246,693 |
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Ordinary shares, shares outstanding | 249,150 | 246,794 |
Noble Corp | ||
Common stock, par value (usd per share) | $ 0.1 | $ 0.1 |
Ordinary shares, shares outstanding | 261,246 | 261,246 |
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Amortization of deferred pension plan, tax provision | $ 145 | $ 87 |
Noble Corp | ||
Amortization of deferred pension plan, tax provision | $ 145 | $ 87 |
Condensed Consolidated Statements of Equity - USD ($) $ in Thousands |
Total |
Common Stock |
Additional Paid-in Capital |
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
Noncontrolling Interests |
Noble Corp |
Noble Corp
Common Stock
|
Noble Corp
Additional Paid-in Capital
|
Noble Corp
Retained Earnings
|
Noble Corp
Accumulated Other Comprehensive Income (Loss)
|
Noble Corp
Noncontrolling Interests
|
||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning Balance (shares) at Dec. 31, 2017 | 244,971,000 | 261,246,000 | ||||||||||||
Beginning Balance at Dec. 31, 2017 | $ 5,950,628 | $ 2,450 | $ 678,922 | $ 4,637,677 | $ (42,888) | $ 674,467 | $ 5,950,014 | $ 26,125 | $ 623,137 | $ 4,669,173 | $ (42,888) | $ 674,467 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stranded tax effect resulting from the Tax Cuts and Job Act | (5,540) | |||||||||||||
Ending Balance (shares) at Jan. 01, 2018 | 244,971,000 | 261,246,000 | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Adjustment for adopting the revenue recognition standard | (148,393) | (148,393) | ||||||||||||
Adjustment for adopting the revenue recognition standard | Accounting Standards Update 2016-16 | (148,393) | (148,393) | ||||||||||||
Adjustment for adopting the revenue recognition standard | Accounting Standards Update 2014-09 | (1,488) | (1,488) | (1,488) | (1,488) | ||||||||||
Beginning Balance (shares) at Dec. 31, 2017 | 244,971,000 | 261,246,000 | ||||||||||||
Beginning Balance at Dec. 31, 2017 | 5,950,628 | $ 2,450 | 678,922 | 4,637,677 | (42,888) | 674,467 | 5,950,014 | $ 26,125 | 623,137 | 4,669,173 | (42,888) | 674,467 | ||
Employee related equity activity | ||||||||||||||
Amortization of share-based compensation | 6,282 | 6,282 | ||||||||||||
Issuance of share-based compensation shares (in shares) | 1,807,000 | |||||||||||||
Issuance of share-based compensation shares | 12 | $ 14 | (2) | |||||||||||
Shares withheld for taxes on equity transactions | (3,319) | (3,319) | ||||||||||||
Distributions to parent company, net | (13,318) | (13,318) | ||||||||||||
Capital contribution by parent - share-based compensation | 6,282 | 6,282 | ||||||||||||
Net income (loss) | (143,320) | (142,334) | (986) | (133,129) | (132,143) | |||||||||
Dividends paid to noncontrolling interests | (2,667) | (2,667) | (2,667) | (2,667) | ||||||||||
Dividend equivalents | [1] | 116 | 116 | |||||||||||
Other comprehensive income, net | 991 | 991 | 991 | 991 | ||||||||||
Ending Balance (shares) at Mar. 31, 2018 | 246,778,000 | 261,246,000 | ||||||||||||
Ending Balance at Mar. 31, 2018 | 5,658,842 | $ 2,464 | 681,883 | 4,351,118 | (47,437) | 670,814 | 5,658,292 | $ 26,125 | 629,419 | 4,379,371 | (47,437) | 670,814 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stockholders' equity, adjusted balance | $ 5,800,747 | $ 2,450 | 678,922 | 4,493,336 | (48,428) | 674,467 | $ 5,800,133 | $ 26,125 | 623,137 | 4,524,832 | (48,428) | 674,467 | ||
Beginning Balance (shares) at Dec. 31, 2018 | 246,794,000 | 246,794,000 | 261,246,000 | 261,246,000 | ||||||||||
Beginning Balance at Dec. 31, 2018 | $ 4,654,574 | $ 2,468 | 699,409 | 3,608,366 | (57,072) | 401,403 | $ 4,653,468 | $ 26,125 | 647,082 | 3,635,930 | (57,072) | 401,403 | ||
Employee related equity activity | ||||||||||||||
Amortization of share-based compensation | 2,952 | 2,952 | ||||||||||||
Issuance of share-based compensation shares (in shares) | 2,356,000 | |||||||||||||
Issuance of share-based compensation shares | 0 | $ 23 | (23) | |||||||||||
Shares withheld for taxes on equity transactions | (2,786) | (2,786) | ||||||||||||
Distributions to parent company, net | (12,077) | (12,077) | ||||||||||||
Capital contribution by parent - share-based compensation | 2,940 | 2,940 | ||||||||||||
Net income (loss) | (66,970) | (70,889) | 3,919 | (56,894) | (60,813) | |||||||||
Dividends paid to noncontrolling interests | (5,020) | (5,020) | (5,020) | (5,020) | ||||||||||
Other comprehensive income, net | $ 1,058 | 1,058 | $ 1,058 | 1,058 | ||||||||||
Ending Balance (shares) at Mar. 31, 2019 | 249,150,000 | 249,150,000 | 261,246,000 | 261,246,000 | ||||||||||
Ending Balance at Mar. 31, 2019 | $ 4,583,808 | $ 2,491 | $ 699,552 | $ 3,537,477 | $ (56,014) | $ 400,302 | $ 4,583,475 | $ 26,125 | $ 650,022 | $ 3,563,040 | $ (56,014) | $ 400,302 | ||
|
Organization and Basis of Presentation |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Note 1— Organization and Basis of Presentation Noble Corporation plc, a public limited company incorporated under the laws of England and Wales (“Noble-UK”), is a leading offshore drilling contractor for the oil and gas industry. We provide contract drilling services with our global fleet of mobile offshore drilling units. As of March 31, 2019, our fleet consisted of 12 floaters (consisting of four semisubmersibles and eight drillships) and 13 jackups. We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. Noble Corporation, a Cayman Islands company (“Noble-Cayman”), is an indirect, wholly-owned subsidiary of Noble-UK, our publicly-traded parent company. Noble-UK’s principal asset is all of the shares of Noble-Cayman. Noble-Cayman has no public equity outstanding. The condensed consolidated financial statements of Noble-UK include the accounts of Noble-Cayman, and Noble-UK conducts substantially all of its business through Noble-Cayman and its subsidiaries. The accompanying unaudited condensed consolidated financial statements of Noble-UK and Noble-Cayman have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) as they pertain to Quarterly Reports on Form 10-Q. Accordingly, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The unaudited financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the financial position and results of operations for the interim periods, on a basis consistent with the annual audited consolidated financial statements. All such adjustments are of a recurring nature. The December 31, 2018 Condensed Consolidated Balance Sheets presented herein are derived from the December 31, 2018 audited consolidated financial statements. These interim financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2018, filed by both Noble-UK and Noble-Cayman. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Beginning in the first quarter of 2019, we combined the semisubmersibles and drillships in our contract drilling services fleet into a single category, “floaters” for reporting purposes. We have made certain reclassifications so as to conform to such current period presentation. The reclassification did not have a material effect on our Condensed Consolidated Statements of Operations or related disclosures. |
Accounting Pronouncements |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Accounting Pronouncements | Note 2— Accounting Pronouncements Accounting Standards Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842, “Leases”), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, time and uncertainty of cash flows arising from lease agreements. We adopted this standard, on a modified retrospective basis, effective January 1, 2019 and will not restate comparative periods. Our adoption did not have a material effect on our condensed consolidated financial statements. With respect to leases in which we are the lessee, we recognized a lease liability and a corresponding right-of-use asset of approximately $28.0 million as of January 1, 2019. We have elected the package of practical expedients that permits us to not reassess (1) whether previously expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. In addition, we have elected the hindsight practical expedient in connection with our adoption of the new lease standard. As lessee, we have made the accounting policy election to not recognize a right-of-use asset lease and lease liability for leases with a term of 12 months or less. We will recognize lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term. We have also elected the practical expedient to not separate lease and non-lease components. Our drilling contracts contain a lease component related to the underlying drilling equipment, in addition to the service component provided by our crews and our expertise to operate such drilling equipment. We have concluded the non-lease service of operating our equipment and providing expertise in the drilling of the client’s well is predominant in our drilling contracts. We have applied the practical expedient to account for the lease and associated non-lease components as a single component. With the election of the practical expedient, we will continue to present a single performance obligation under the new revenue guidance in Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers.” Issued Accounting Standards With the exception of the updated standards discussed above, there have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our condensed consolidated financial statements. |
Consolidated Joint Ventures |
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Mar. 31, 2019 | |
Noncontrolling Interest [Abstract] | |
Consolidated Joint Ventures | Note 3— Consolidated Joint Ventures We maintain a 50 percent interest in two joint ventures, each with a subsidiary of Royal Dutch Shell plc (“Shell”), that own and operate the two Bully-class drillships. We have determined that we are the primary beneficiary of the joint ventures. Accordingly, we consolidate the entities in our condensed consolidated financial statements after eliminating intercompany transactions. Shell’s equity interests are presented as noncontrolling interests on our Condensed Consolidated Balance Sheets. During the three months ended March 31, 2019 and 2018, the Bully joint ventures approved and paid dividends totaling $10.0 million and $5.3 million, respectively. Of these amounts, 50 percent was paid to our joint venture partner. The combined carrying amount of the Bully-class drillships at both March 31, 2019 and December 31, 2018 totaled $0.7 billion. These assets were primarily funded through partner equity contributions. Cash held by the Bully joint ventures totaled approximately $42.1 million at March 31, 2019 as compared to approximately $45.2 million at December 31, 2018. |
Loss Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Per Share | Note 4— Loss Per Share The following table presents the computation of basic and diluted loss per share for Noble-UK:
Only those items having a dilutive impact on our basic loss per share are included in diluted loss per share. For the three months ended March 31, 2019 and 2018, approximately 13.2 million and 13.7 million share-based awards, respectively, were excluded from diluted loss per share since the effect would have been anti-dilutive. Share capital As of March 31, 2019, Noble-UK had approximately 249.2 million shares outstanding and trading as compared to approximately 246.8 million shares outstanding and trading at December 31, 2018. At our 2019 Annual General Meeting, shareholders approved a proposal to allow our Board of Directors to increase share capital through the issuance of up to approximately 83.1 million ordinary shares (at current nominal value of $0.01 per share). The right of our directors to allot shares will expire at the end of our 2020 Annual General Meeting unless we seek an extension from shareholders at that time. No shares were allotted during the three months ended March 31, 2019. The declaration and payment of dividends require the authorization of the Board of Directors of Noble-UK, provided that such dividends on issued share capital may be paid only out of Noble-UK’s “distributable reserves” on its statutory balance sheet in accordance with UK law. Therefore, Noble-UK is not permitted to pay dividends out of share capital, which includes share premium. Noble has not paid dividends since the third quarter of 2016. The payment of future dividends will depend on our results of operations, financial condition, cash requirements, future business prospects, contractual and indenture restrictions and other factors deemed relevant by our Board of Directors. Share repurchases Under UK law, the Company is only permitted to purchase its own shares by way of an “off-market purchase” in a plan approved by shareholders. We currently do not have shareholder authority to repurchase shares. During the three months ended March 31, 2019 and 2018, we did not repurchase any of our shares. |
Property and Equipment |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Note 5— Property and Equipment Property and equipment, at cost, for Noble-UK consisted of the following:
On February 28, 2019, we purchased another GustoMSC CJ46 rig, the Noble Joe Knight. We paid $83.8 million for the rig, with $30.2 million paid in cash and the remaining $53.6 million of the purchase price financed with a loan by the seller, PaxOcean Group (“PaxOcean”). See “Note 6— Debt” for additional information. |
Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Note 6— Debt Credit Facilities 2015 Credit Facility We have a $300 million senior unsecured credit facility that will mature in January 2020 and is guaranteed by our indirect, wholly-owned subsidiaries, Noble Holding (U.S.) LLC (“NHUS”) and Noble Holding International Limited (“NHIL”) (the “2015 Credit Facility”). In January 2018, in connection with entering into the 2017 Credit Facility (as defined herein), we amended the 2015 Credit Facility, which caused, among other things, a reduction in the aggregate principal amount of commitments under the 2015 Credit Facility. As a result of the 2015 Credit Facility’s reduction in the aggregate principal amount of commitments, we recognized a net loss of approximately $2.3 million in the three months ended March 31, 2018. Borrowings under the 2015 Credit Facility bear interest at the London inter-bank offered rate (“LIBOR”) plus an applicable margin, which is currently the maximum contractual rate of 1.65%. At March 31, 2019, we had $300.0 million of borrowings outstanding under the 2015 Credit Facility. 2017 Credit Facility On December 21, 2017, Noble Cayman Limited, a Cayman Islands company and a wholly-owned indirect subsidiary of Noble-Cayman ; Noble International Finance Company, a Cayman Islands company and a wholly-owned indirect subsidiary of Noble-Cayman ; and Noble Holding UK Limited, a company incorporated under the laws of England and Wales and a wholly-owned direct subsidiary of Noble-UK (“NHUK”), as parent guarantor, entered into a new senior unsecured credit agreement (the “2017 Credit Facility” and, together with the 2015 Credit Facility, the “Credit Facilities”). The maximum aggregate amount of commitments under the 2017 Credit Facility is approximately $1.5 billion. Borrowings under the 2017 Credit Facility are subject to certain conditions precedent, including that there be no unused commitments to advance loans under the 2015 Credit Facility. The 2017 Credit Facility will mature in January 2023. Borrowings may be used for working capital and other general corporate purposes. The 2017 Credit Facility provides for a letter of credit sub-facility currently in the amount of $15.0 million, with the ability to increase such amount up to $500.0 million with the approval of the lenders. Borrowing under the 2017 Credit Facility bear interest at LIBOR plus an applicable margin, which is currently the maximum contractual rate of 4.25%. At March 31, 2019, we had $50.0 million of borrowings outstanding under the 2017 Credit Facility, plus $3.4 million of performance letters of credit. Both of our Credit Facilities have provisions which vary the applicable interest rates for borrowings based upon our debt ratings. We also pay a facility fee under the 2015 Credit Facility on the full commitments thereunder (used or unused) and a commitment fee under the 2017 Credit Facility on the daily unused amount of the underlying commitments, in each case which varies depending on our credit ratings. At March 31, 2019, the interest rates and fees in effect under our Credit Facilities were the highest permitted interest rates under those agreements. Debt Issuance In January 2018, we issued $750.0 million aggregate principal amount of our Senior Notes due 2026 (the “2026 Notes”) through our indirect wholly-owned subsidiary, NHIL. The net proceeds of the offering of approximately $737.4 million, after expenses, were used to retire a portion of our near-term senior notes in a related tender offer. The indenture for the 2026 Notes contains certain covenants and restrictions, including, among others, restrictions on our subsidiaries’ ability to incur certain additional indebtedness. Additionally, the subsidiary guarantors must own, directly or indirectly, (i) assets comprising at least 85% of the revenue of Noble-Cayman and its subsidiaries on a consolidated basis and (ii) jackups, semisubmersibles, drillships, submersibles or other mobile offshore drilling units of material importance, the combined book value of which comprises at least 85% of the combined book value of all such assets of Noble-Cayman and its subsidiaries on a consolidated basis, in each case, with respect to the most recently completed fiscal year. Seller Loans 2019 Seller Loan In February 2019, we purchased the Noble Joe Knight for $83.8 million with a $53.6 million seller-financed secured loan (the “2019 Seller Loan”). The 2019 Seller Loan has a term of four years and requires a 5% principal payment at the end of the third year with the remaining 95% of the principal due at the end of the term. The 2019 Seller Loan bears a cash interest rate of 4.25% and the equivalent of a 1.25% interest rate paid-in-kind over the four-year term of the 2019 Seller Loan. Based on the terms of the 2019 Seller Loan, the 1.25% paid-in-kind interest rate is accelerated into the first year, resulting in an overall first year interest rate of 8.91%, of which only 4.25% is payable in cash. Thereafter, the paid-in-kind interest ends and the cash interest rate of 4.25% is payable for the remainder of the term. 2018 Seller Loan In September 2018, we purchased the Noble Johnny Whitstine for $93.8 million with a $60.0 million seller-financed secured loan (the “2018 Seller Loan” and, together with the 2019 Seller Loan, the “Seller Loans”). The 2018 Seller Loan has a term of four years and requires a 5% principal payment at the end of the third year with the remaining 95% of the principal due at the end of the term. The 2018 Seller Loan bears a cash interest rate of 4.25% and the equivalent of a 1.25% interest rate paid-in-kind over the four-year term of the 2018 Seller Loan. Based on the terms of the 2018 Seller Loan, the 1.25% paid-in-kind interest rate is accelerated into the first year, resulting in an overall first year interest rate of 8.91%, of which only 4.25% is payable in cash. Thereafter, the paid-in-kind interest ends and the cash interest rate of 4.25% is payable for the remainder of the term. Both of the Seller Loans are guaranteed by Noble-Cayman and each is secured by a mortgage on the applicable rig and by the pledge of the shares of the applicable single-purpose entity that owns the relevant rig. Each Seller Loan contains debt to total capitalization ratio and minimum liquidity financial covenants substantially similar to the 2017 Credit Facility, and an asset and revenue covenant substantially similar to the 2026 Notes as well as other covenants and provisions customarily found in secured transactions, including a cross default provision. Each Seller Loan requires immediate repayment on the occurrence of certain events, including the termination of the drilling contract associated with the relevant rig. Senior Notes Interest Rate Adjustments Our Senior Notes due 2025 and our Senior Notes due 2045 are subject to provisions that vary the applicable interest rates based on our debt rating. Effective April 2018, these senior notes have reached the contractually defined maximum interest rate set for each rating agency and no further interest rate increases are possible. The interest rates on these senior notes may be decreased if our debt ratings were to be raised by either rating agency above specified levels. Our other outstanding senior notes do not contain provisions varying applicable interest rates based upon our credit ratings. Debt Tender Offers, Repayments, and Open Market Repurchases In March 2019, we completed cash tender offers for our Senior Notes due 2020 (the “2020 Notes”), Senior Notes due 2021 (the “2021 Notes”), Senior Notes due 2022 (the “2022 Notes”) and Senior Notes due 2024 (the “2024 Notes”). Pursuant to such tender offers, we purchased $440.9 million aggregate principal amount of these senior notes for $400.0 million, plus accrued interest, using cash on hand and borrowings under the 2015 Credit Facility. As a result of this transaction, we recognized a net gain of approximately $31.3 million. In October 2018, we purchased $27.4 million aggregate principal amount of various tranches of our senior notes for approximately $20.2 million, plus accrued interest, as open market repurchases and recognized a net gain of approximately $6.9 million. In August 2018, we purchased $0.4 million aggregate principal amount of our Senior Notes due 2042 for approximately $0.3 million, plus accrued interest, as open market repurchases and recognized a net gain of approximately $0.1 million. In March 2018, we repaid the remaining aggregate principal amount of $126.6 million of our Senior Notes due 2018 (the “2018 Notes”) at maturity using cash on hand. In March 2018, we purchased $9.5 million aggregate principal amount of various tranches of our senior notes for approximately $8.7 million, plus accrued interest, as open market repurchases and recognized a net gain of approximately $0.5 million. In February 2018, we redeemed the remaining principal amount of $61.9 million of our Senior Notes due 2019 (the “2019 Notes”) for approximately $65.3 million, plus accrued interest. As a result of this transaction, we recognized a net loss of approximately $3.5 million. In February 2018, we completed cash tender offers for the 2018 Notes, the 2019 Notes, the 2020 Notes, the 2021 Notes, the 2022 Notes and the 2024 Notes. Pursuant to such tender offers, we purchased $754.2 million aggregate principal amount of these senior notes for $750.0 million, plus accrued interest, using the net proceeds of the 2026 Notes issuance and cash on hand. As a result of this transaction, we recognized a net loss of approximately $3.5 million. Covenants The 2017 Credit Facility contains certain financial covenants applicable to NHUK and its subsidiaries, including (i) a covenant restricting debt to total tangible capitalization to not greater than 0.55 at the end of each fiscal quarter, (ii) a minimum Liquidity requirement of $300.0 million, (iii) a covenant that, beginning with the fiscal quarter ending March 31, 2018, the ratio of the Rig Value (as defined in the 2017 Credit Facility) of Marketed Rigs (as defined in the 2017 Credit Facility) to the sum of commitments under the 2017 Credit Facility plus indebtedness for borrowed money of the borrowers and guarantors, in each case, that directly own Marketed Rigs, is not less than 3:00 to 1:00 at the end of each fiscal quarter and (iv) a covenant that, beginning with the fiscal quarter ending March 31, 2018, the ratio of (A) the Rig Value of the Closing Date Rigs (as defined in the 2017 Credit Facility) that are directly wholly owned by the borrowers and guarantors to (B) the Rig Value of the Closing Date Rigs owned by NHUK, subsidiaries of NHUK and certain local content affiliates, is not less than 80% at the end of each fiscal quarter (such covenants described in (iii) and (iv) of this paragraph, the “Guarantor Ratio Covenants”). The 2017 Credit Facility also includes restrictions on borrowings if, after giving effect to any such borrowings and the application of the proceeds thereof, the aggregate amount of Available Cash (as defined in the 2017 Credit Facility) would exceed $200.0 million. NHUK has guaranteed the obligations of the borrowers under the 2017 Credit Facility. In addition, certain indirect subsidiaries of Noble-UK that own rigs are guarantors under the 2017 Credit Facility. Certain other subsidiaries of Noble-UK may be required from time to time to guarantee the obligations of the borrowers under the 2017 Credit Facility in order maintain compliance with the Guarantor Ratio Covenants. The 2017 Credit Facility contains additional restrictive covenants generally applicable to NHUK and its subsidiaries, including restrictions on the incurrence of liens and indebtedness, mergers and other fundamental changes, restricted payments, repurchases and redemptions of indebtedness with maturities outside of the maturity of the 2017 Credit Facility, sale and leaseback transactions and transactions with affiliates. The 2015 Credit Facility is guaranteed by NHUS and NHIL. The 2015 Credit Facility contains a covenant that limits our ratio of debt to total tangible capitalization, as defined in the 2015 Credit Facility, to 0.60 at the end of each fiscal quarter. In addition to the covenants from the Credit Facilities noted above, the covenants from the 2026 Notes described under “—Debt Issuance” above, and the covenants from the Seller Loans described under “—Seller Loans” above, the indentures governing our outstanding senior unsecured notes contain covenants that place restrictions on certain merger and consolidation transactions, unless we are the surviving entity or the other party assumes the obligations under the indenture, and on the ability to sell or transfer all or substantially all of our assets. There are also restrictions on incurring or assuming certain liens and on entering into sale and lease-back transactions. At March 31, 2019, our debt to total tangible capitalization ratio under our 2017 Credit Facility was approximately 0.48 and we were in compliance with all applicable debt covenants. We continually monitor compliance with the covenants under our Credit Facilities, senior notes and Seller Loans and expect to remain in compliance throughout 2019. Fair Value of Debt Fair value represents the amount at which an instrument could be exchanged in a current transaction between willing parties. The estimated fair value of our debt instruments was based on the quoted market prices for similar issues or on the current rates offered to us for debt of similar remaining maturities (Level 2 measurement). The carrying amount of the Credit Facilities approximates fair value as the interest rates are variable and reflective of market rates. All remaining fair value disclosures are presented in “Note 12— Fair Value of Financial Instruments.” The following table presents the carrying value, net of unamortized debt issuance costs and discounts, and the estimated fair value of our total debt, not including the effect of unamortized debt issuance costs, respectively:
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Accumulated Other Comprehensive Income (Loss) | Note 7— Accumulated Other Comprehensive Income (Loss) The following table presents the changes in the accumulated balances for each component of “Accumulated other comprehensive income (loss)” (“AOCI”) for the three months ended March 31, 2019 and 2018. All amounts within the table are shown net of tax.
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Revenue and Customers | Note 8— Revenue and Customers Contract Balances Accounts receivable are recognized when the right to consideration becomes unconditional based upon contractual billing schedules. Payment terms on invoiced amounts are typically 30 days. Current contract asset and liability balances are included in “Prepaid expenses and other current assets” and “Other current liabilities,” respectively, and noncurrent contract assets and liabilities are included in “Other assets” and “Other liabilities,” respectively, on our Condensed Consolidated Balance Sheets. The following table provides information about contract assets and contract liabilities from contracts with customers:
Significant changes in the remaining performance obligation contract assets and the contract liabilities balances for the three months ended March 31, 2019 are as follows:
Transaction Price Allocated to the Remaining Performance Obligations The following table reflects revenue expected to be recognized in the future related to unsatisfied performance obligations, by rig type, at the end of the reporting period:
The revenue included above consists of expected mobilization, demobilization, and upgrade revenue for unsatisfied performance obligations. The amounts are derived from the specific terms within drilling contracts that contain such provisions, and the expected timing for recognition of such revenue is based on the estimated start date and duration of each respective contract based on information known at March 31, 2019. The actual timing of recognition of such amounts may vary due to factors outside of our control. We have taken the optional exemption, permitted by accounting standards, to exclude disclosure of the estimated transaction price related to the variable portion of unsatisfied performance obligations at the end of the reporting period, as our transaction price is based on a single performance obligation consisting of a series of distinct hourly, or more frequent, periods, the variability of which will be resolved at the time of the future services. Disaggregation of Revenue The following table provides information about contract drilling revenue by rig types:
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Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Note 9— Leases Leases We determine if an arrangement is a lease at inception. Our operating lease agreements are primarily for real estate, equipment, storage, dock space and automobiles and are included within “Other current liabilities,” “Other assets” and “Other liabilities,” respectively, on our Condensed Consolidated Balance Sheets. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Certain of our lease agreements include options to extend or terminate the lease, which we do not include in our minimum lease terms unless management is reasonably certain to exercise. Supplemental balance sheet information related to leases was as follows:
The components of lease cost were as follows:
Supplemental cash flow information related to leases was as follows:
Maturities of lease liabilities as of March 31, 2019 were as follows:
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Income Taxes |
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Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 10— Income Taxes At March 31, 2019, the reserves for uncertain tax positions totaled $195.1 million (net of related tax benefits of $1.0 million). At December 31, 2018, the reserves for uncertain tax positions totaled $183.8 million (net of related tax benefits of $1.0 million). It is reasonably possible that our existing liabilities related to our reserve for uncertain tax positions may fluctuate in the next 12 months primarily due to the completion of open audits or the expiration of statutes of limitation. However, we cannot reasonably estimate a range of changes in our existing liabilities due to various uncertainties, such as the unresolved nature of various audits. |
Employee Benefit Plans |
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Retirement Benefits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans | Note 11— Employee Benefit Plans Pension costs include the following components for the three months ended March 31, 2019 and 2018:
During the three months ended March 31, 2019 and 2018, we made no contributions to our pension plans. Effective December 31, 2016, employees and alternate payees accrue no future benefits under the U.S. plans and, as such, Noble recognized no service costs with the plans for the three months ended March 31, 2019 and 2018. |
Fair Value of Financial Instruments |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Note 12— Fair Value of Financial Instruments The following tables present the carrying amount and estimated fair value of our financial instruments recognized at fair value on a recurring basis:
Our cash, cash equivalents and restricted cash, accounts receivable, marketable securities and accounts payable are by their nature short-term. As a result, the carrying values included in our Condensed Consolidated Balance Sheets approximate fair value. |
Commitments and Contingencies |
3 Months Ended |
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Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13— Commitments and Contingencies Transocean Ltd. In January 2017, a subsidiary of Transocean Ltd. (“Transocean”) filed suit against us and certain of our subsidiaries for patent infringement in a Texas federal court and Transocean later added another claim alleging that we breached a 2007 settlement agreement we entered into with Transocean relating to patent claims in respect of another Noble rig. The suit claims that five of our newbuild rigs that operated in the U.S. Gulf of Mexico violated Transocean patents relating to what is generally referred to as dual-activity drilling. We were aware of the patents when we constructed the rigs. The patents are now expired in the United States and most other countries. While there is inherent risk in litigation, we do not believe that our rigs infringe the Transocean patents or that there has been any breach of the 2007 agreement. The litigation continues, and the court has set a trial date in November 2019. We continue to defend ourselves vigorously against this claim. Brazil commercial agent We previously used a commercial agent in Brazil in connection with our Petróleo Brasileiro S.A. (“Petrobras”) drilling contracts. This agent represented a number of different companies in Brazil over many years, including several offshore drilling contractors. In November 2015, this agent pled guilty in Brazil in connection with the award of a drilling contract to a competitor and implicated a Petrobras official as part of a wider investigation of Petrobras’ business practices. Following news reports relating to the agent’s involvement in the Brazil investigation in connection with his activities with other companies, we conducted a review, which was substantially completed in 2017, of our relationship with the agent and with Petrobras. We have been in contact and cooperated with the SEC, the Brazilian federal prosecutor’s office and the U.S. Department of Justice (“DOJ”) about this matter and in December 2018, the SEC and the DOJ each advised us that they had closed their file on this matter. We have remained in contact with the Brazilian federal prosecutor’s office, who is aware of our internal review, and continue to cooperate with any questions or requests they may have. To our knowledge, neither the agent, nor the government authorities investigating the matter, has alleged that the agent or Noble acted improperly in connection with our contracts with Petrobras. Paragon Offshore On August 1, 2014, Noble-UK completed the separation and spin-off of a majority of its standard specification offshore drilling business (the “Spin-off”) through a pro rata distribution of all of the ordinary shares of its wholly-owned subsidiary, Paragon Offshore plc (“Paragon Offshore”), to the holders of Noble’s ordinary shares. In February 2016, Paragon Offshore sought approval of a pre-negotiated plan of reorganization (the “Prior Plan”) by filing for voluntary relief under Chapter 11 of the United States Bankruptcy Code. As part of the Prior Plan, we entered into a settlement agreement with Paragon Offshore (the “Settlement Agreement”). The Prior Plan was rejected by the bankruptcy court in October 2016. In April 2017, Paragon Offshore filed a revised plan of reorganization (the “New Plan”) in its bankruptcy proceeding. Under the New Plan, Paragon Offshore no longer needed the Mexican tax bonding that Noble-UK was to provide under the Settlement Agreement. Consequently, Paragon Offshore abandoned the Settlement Agreement as part of the New Plan, and the Settlement Agreement was terminated at the time of the filing of the New Plan. On May 2, 2017, Paragon Offshore announced that it had reached an agreement in principle with both its secured and unsecured creditors to revise the New Plan to, among other things, create and fund a $10.0 million litigation trust to pursue litigation against us. On June 7, 2017, the revised New Plan was approved by the bankruptcy court, and Paragon Offshore emerged from bankruptcy on July 18, 2017. On December 15, 2017, the litigation trust filed claims relating to the Spin-off against us and certain of our current and former officers and directors in the Delaware bankruptcy court that heard Paragon Offshore’s bankruptcy. The complaint alleges claims of alleged actual and constructive fraudulent conveyance, unjust enrichment and recharacterization of intercompany notes as equity claims against Noble and claims of breach of fiduciary duty and aiding and abetting breach of fiduciary duty against the officer and director defendants. The complaint states that the litigation trust is seeking damages of approximately $1.7 billion from the Company, an amount equal to the amount borrowed by Paragon Offshore immediately prior to the Spin-off, as well as unspecified amounts in respect of the claims against the officer and director defendants all of whom have indemnification arrangements with us. Discovery continues and the court has approved a litigation schedule, which could result in all pre-trial activity being completed during the second quarter of 2020. A trial date has not yet been set. We believe that Paragon Offshore, at the time of the Spin-off, was properly funded, solvent and had appropriate liquidity and that the claims brought by the litigation trust are without merit. We intend to defend ourselves vigorously. However, there is inherent risk and substantial expense in litigation, and the amount of damages the plaintiff is seeking is substantial. If any of the litigation trust’s claims are successful, or if we elect to settle any claims (in part to reduce or eliminate the ongoing cost of defending the litigation and eliminate any risk of a larger judgment against us), any damages or other amounts we would be required to or agree to pay could be substantial and could have a material adverse effect on our business, financial condition and results of operations. Because of our view of the merits of the claims and the significant discovery still to be conducted in the litigation, we are not currently able to make a reasonable estimation of the amount of possible loss we may incur, if any. Subsequent developments in the litigation may make such an estimation possible, in which case we may record a charge against our income when a loss is reasonably estimable. This may occur even though the litigation may still be ongoing. Any charge could be material and could have a material adverse effect on our financial condition and results of operations. It may also be materially different than any amount we are required to pay once the litigation is concluded. We have directors’ and officers’ indemnification coverage for the officers and directors who have been sued by the litigation trust. The insurers have accepted coverage for the director and officer claims and we are continuing to discuss with them the scope of their reimbursement of litigation expenses. In addition, at the time of the Spin-off, we had entity coverage, or “Side C” coverage, which was meant to cover certain litigation claims up to the coverage limit of $150.0 million, including litigation expenses. We have made a claim for coverage of the litigation trust’s claims against Noble under such entity insurance. The insurers have rejected coverage for these claims. We cannot predict the amount of claims and expenses we may incur, pay or settle in the Paragon Offshore litigation that such insurance will cover, if any. Prior to the completion of the Spin-off, Noble-UK and Paragon Offshore entered into a series of agreements to effect the separation and Spin-off and govern the relationship between the parties after the Spin-off (the “Separation Agreements”), including the MSA and a Tax Sharing Agreement (the “TSA”). As part of its final bankruptcy plan, Paragon Offshore rejected the Separation Agreements. Accordingly, the indemnity obligations that Paragon Offshore potentially would have owed us under the Separation Agreements have now terminated, including indemnities arising under the MSA and the TSA in respect of obligations related to Paragon Offshore’s business that were incurred through Noble-retained entities prior to the Spin-off. Likewise, any potential indemnity obligations that we would have owed Paragon Offshore under the Separation Agreements, including those under the MSA and the TSA in respect of Noble-UK’s business that was conducted prior to the Spin-off through Paragon Offshore-retained entities, are now also extinguished. In the absence of the Separation Agreements, liabilities relating to the respective parties will be borne by the owner of the legal entity or asset at issue and neither party will look to an allocation based on the historic relationship of an entity or asset to one of the party’s business, as had been the case under the Separation Agreements. The rejection and ultimate termination of the indemnity and related obligations under the Separation Agreements resulted in a number of accounting charges and benefits during the year ended December 31, 2017, and such termination may continue to affect us in the future as liabilities arise for which we would have been indemnified by Paragon Offshore or would have had to indemnify Paragon Offshore. We do not expect that, overall, the rejection of the Separation Agreements by Paragon Offshore will have a material adverse effect on our financial condition or liquidity. However, any loss we experience with respect to which we would have been able to secure indemnification from Paragon Offshore under one or more of the Separation Agreements could have an adverse impact on our results of operations in any period, which impact may be material depending on our results of operations during this down-cycle. During the three months ended March 31, 2019, we recognized charges of $3.8 million recorded in “Net loss from discontinued operations, net of tax” on our Condensed Consolidated Statement of Operations relating to settlement of Mexico customs audits from rigs included in the Spin-off. Tax matters During 2014, the Internal Revenue Service (“IRS”) began its examination of our tax reporting in the U.S. for the taxable years ended December 31, 2010 and 2011. The IRS examination team has completed its examination of our 2010 and 2011 U.S. tax returns and proposed adjustments and deficiencies with respect to certain items that were reported by us for the 2010 and 2011 tax year. On December 19, 2016, we received the Revenue Agent Report from the IRS. We believe that we have accurately reported all amounts in our tax returns, and have submitted administrative protests with the IRS Office of Appeals contesting the examination team’s proposed adjustments. We intend to vigorously defend our reported positions, and believe the ultimate resolution of the adjustments proposed by the IRS examination team will not have a material adverse effect on our condensed consolidated financial statements. During the third quarter of 2017, the IRS initiated its examination of our 2012, 2013, 2014 and 2015 tax returns. Audit claims of approximately $51.9 million attributable to income and other business taxes have been assessed against Noble entities in Mexico related to tax years 2005 and 2007. We intend to vigorously defend our reported positions, and believe the ultimate resolution of the audit claims will not have a material adverse effect on our consolidated financial statements. We operate in a number of countries throughout the world and our tax returns filed in those jurisdictions are subject to review and examination by tax authorities within those jurisdictions. We recognize uncertain tax positions that we believe have a greater than 50 percent likelihood of being sustained. We cannot predict or provide assurance as to the ultimate outcome of any existing or future assessments. Other contingencies We have entered into agreements with certain of our executive officers, as well as certain other employees. These agreements become effective upon a change of control of Noble-UK (within the meaning set forth in the agreements) or a termination of employment in connection with or in anticipation of a change of control, and remain effective for three years thereafter. These agreements provide for compensation and certain other benefits under such circumstances. We are a defendant in certain claims and litigation arising out of operations in the ordinary course of business, including personal injury claims, the resolution of which, in the opinion of management, will not be material to our financial position, results of operations or cash flows. There is inherent risk in any litigation or dispute and no assurance can be given as to the outcome of these claims. |
Supplemental Financial Information |
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Supplemental Financial Information | Note 14— Supplemental Financial Information Condensed Consolidated Balance Sheets Information Our restricted cash balance as of March 31, 2019 and December 31, 2018 consisted of $1.3 million and $0.7 million, respectively, and is included in “Prepaid expenses and other current assets.” Condensed Consolidated Statements of Cash Flows Information Operating cash activities The net effect of changes in other assets and liabilities on cash flows from operating activities is as follows:
Non-cash investing and financing activities Additions to property and equipment, at cost for which we had accrued a corresponding liability in accounts payable as of March 31, 2019 and December 31, 2018 were $38.5 million and $52.1 million, respectively. Additions to property and equipment, at cost for which we had accrued a corresponding liability in accounts payable as of March 31, 2018 and December 31, 2017 were $29.6 million and $25.5 million, respectively. In February 2019, we entered into the $53.6 million 2019 Seller Loan to finance a portion of the purchase price for the Noble Joe Knight. See “Note 6— Debt” for additional information. |
Condensed Consolidating Financial Information |
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Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Financial Information | Note 15— Condensed Consolidating Financial Information Guarantees of Registered Securities Noble-Cayman, or one or more 100 percent owned subsidiaries of Noble-Cayman, is an issuer, co-issuer or full and unconditional guarantor or otherwise obligated as of March 31, 2019 with respect to registered securities as follows (see “Note 6— Debt” for additional information):
(1) Our 2026 Notes are excluded from this list as they are unregistered securities issued in a non-public offering. The following condensed consolidating financial statements of Noble-Cayman, NHIL and all other subsidiaries present investments in both consolidated and unconsolidated affiliates using the equity method of accounting. NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2018 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended March 31, 2018 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2018 (in thousands) (Unaudited)
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Organization and Basis of Presentation (Policies) |
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Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation | The accompanying unaudited condensed consolidated financial statements of Noble-UK and Noble-Cayman have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) as they pertain to Quarterly Reports on Form 10-Q. Accordingly, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The unaudited financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the financial position and results of operations for the interim periods, on a basis consistent with the annual audited consolidated financial statements. All such adjustments are of a recurring nature. The December 31, 2018 Condensed Consolidated Balance Sheets presented herein are derived from the December 31, 2018 audited consolidated financial statements. These interim financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2018, filed by both Noble-UK and Noble-Cayman. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. |
New Accounting Pronouncements | Accounting Standards Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842, “Leases”), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, time and uncertainty of cash flows arising from lease agreements. We adopted this standard, on a modified retrospective basis, effective January 1, 2019 and will not restate comparative periods. Our adoption did not have a material effect on our condensed consolidated financial statements. With respect to leases in which we are the lessee, we recognized a lease liability and a corresponding right-of-use asset of approximately $28.0 million as of January 1, 2019. We have elected the package of practical expedients that permits us to not reassess (1) whether previously expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. In addition, we have elected the hindsight practical expedient in connection with our adoption of the new lease standard. As lessee, we have made the accounting policy election to not recognize a right-of-use asset lease and lease liability for leases with a term of 12 months or less. We will recognize lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term. We have also elected the practical expedient to not separate lease and non-lease components. Our drilling contracts contain a lease component related to the underlying drilling equipment, in addition to the service component provided by our crews and our expertise to operate such drilling equipment. We have concluded the non-lease service of operating our equipment and providing expertise in the drilling of the client’s well is predominant in our drilling contracts. We have applied the practical expedient to account for the lease and associated non-lease components as a single component. With the election of the practical expedient, we will continue to present a single performance obligation under the new revenue guidance in Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers.” Issued Accounting Standards With the exception of the updated standards discussed above, there have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our condensed consolidated financial statements. |
Contract Balances | Contract Balances Accounts receivable are recognized when the right to consideration becomes unconditional based upon contractual billing schedules. Payment terms on invoiced amounts are typically 30 days. Current contract asset and liability balances are included in “Prepaid expenses and other current assets” and “Other current liabilities,” respectively, and noncurrent contract assets and liabilities are included in “Other assets” and “Other liabilities,” respectively, on our Condensed Consolidated Balance Sheets. |
Loss Per Share (Tables) |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Earnings Per Share for Noble-UK | The following table presents the computation of basic and diluted loss per share for Noble-UK:
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Property and Equipment (Tables) |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment, at Cost | Property and equipment, at cost, for Noble-UK consisted of the following:
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Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Fair Value of Our Long-Term Debt, not Including Effect of Unamortized Debt Issuance Costs | The following table presents the carrying value, net of unamortized debt issuance costs and discounts, and the estimated fair value of our total debt, not including the effect of unamortized debt issuance costs, respectively:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Accumulated Balances for Components of AOCI | The following table presents the changes in the accumulated balances for each component of “Accumulated other comprehensive income (loss)” (“AOCI”) for the three months ended March 31, 2019 and 2018. All amounts within the table are shown net of tax.
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Revenue and Customers (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contract with Customer, Asset and Liability | The following table provides information about contract assets and contract liabilities from contracts with customers:
Significant changes in the remaining performance obligation contract assets and the contract liabilities balances for the three months ended March 31, 2019 are as follows:
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Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | The following table reflects revenue expected to be recognized in the future related to unsatisfied performance obligations, by rig type, at the end of the reporting period:
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Disaggregation of revenue by rig types | The following table provides information about contract drilling revenue by rig types:
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Leases (Tables) |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental financial information and lease cost | Supplemental balance sheet information related to leases was as follows:
The components of lease cost were as follows:
Supplemental cash flow information related to leases was as follows:
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Maturities of lease liabilities | Maturities of lease liabilities as of March 31, 2019 were as follows:
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Employee Benefit Plans (Tables) |
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension Costs | Pension costs include the following components for the three months ended March 31, 2019 and 2018:
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Fair Value of Financial Instruments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Amount and Estimated Fair Value of Financial Instruments | The following tables present the carrying amount and estimated fair value of our financial instruments recognized at fair value on a recurring basis:
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Supplemental Financial Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Effect of Changes in Other Assets and Liabilities on Cash Flows from Operating Activities | The net effect of changes in other assets and liabilities on cash flows from operating activities is as follows:
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Condensed Consolidating Financial Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Obligations | Noble-Cayman, or one or more 100 percent owned subsidiaries of Noble-Cayman, is an issuer, co-issuer or full and unconditional guarantor or otherwise obligated as of March 31, 2019 with respect to registered securities as follows (see “Note 6— Debt” for additional information):
(1) Our 2026 Notes are excluded from this list as they are unregistered securities issued in a non-public offering. |
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Condensed Consolidating Balance Sheet | NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2018 (in thousands) (Unaudited)
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Condensed Consolidating Statement of Income | NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended March 31, 2018 (in thousands) (Unaudited)
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Condensed Consolidating Statement of Cash Flows | NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2019 (in thousands) (Unaudited)
NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Three Months Ended March 31, 2018 (in thousands) (Unaudited)
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Organization and Basis of Presentation (Details) |
3 Months Ended |
---|---|
Mar. 31, 2019
Segment
Vessel
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of floaters (vessel) | 12 |
Number of semisubmersibles (vessel) | 4 |
Number of drillships (vessel) | 8 |
Number of jackups (vessel) | 13 |
Number of reportable segments | Segment | 1 |
Accounting Pronouncements (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Jan. 01, 2019 |
---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 28,272 | |
Present value of lease liability | $ 27,639 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 28,000 | |
Present value of lease liability | $ 28,000 |
Consolidated Joint Ventures (Details) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019
USD ($)
Vessel
JointVenture
|
Mar. 31, 2018
USD ($)
|
Dec. 31, 2018
USD ($)
|
|
Schedule Of Equity Method Investments [Line Items] | |||
Percent of interest in joint ventures | 50.00% | ||
Number of joint ventures | JointVenture | 2 | ||
Number of bully class drillships (vessel) | Vessel | 2 | ||
Cash and cash equivalents | $ 187,093 | $ 375,232 | |
Bully Joint Venture | |||
Schedule Of Equity Method Investments [Line Items] | |||
Dividends approved | 10,000 | $ 5,300 | |
Carrying amount of the drillships | 700,000 | 700,000 | |
Cash and cash equivalents | $ 42,100 | $ 45,200 | |
Bully Joint Venture | |||
Schedule Of Equity Method Investments [Line Items] | |||
Percentage attributable to noncontrolling interests | 50.00% |
Loss Per Share - Additional Information (Details) - $ / shares |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
Dec. 31, 2018 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares outstanding and trading (shares) | 249,150,000 | 246,794,000 | |
Additional shares authorized for issuance (shares) | 83,100,000 | ||
Current nominal value per share (usd per share) | $ 0.01 | $ 0.01 | |
Number of shares allotted (shares) | 0 | ||
Equity option | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from the diluted net income per share (shares) | 13,200,000 | 13,700,000 |
Property and Equipment (Details) - USD ($) $ in Thousands |
1 Months Ended | |||
---|---|---|---|---|
Feb. 28, 2019 |
Feb. 28, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
|
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | $ 11,017,281 | $ 10,956,412 | ||
Drilling equipment and facilities | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 10,497,161 | 10,546,376 | ||
Construction in progress | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 318,700 | 209,091 | ||
Other | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | $ 201,420 | $ 200,945 | ||
Noble Joe Knight | ||||
Property, Plant and Equipment [Line Items] | ||||
Purchase price of asset acquired | $ 83,800 | $ 83,800 | ||
Seller-financed secured loan due February 2023 | ||||
Property, Plant and Equipment [Line Items] | ||||
Financed value | 53,600 | $ 53,600 | ||
Seller-financed secured loan due February 2023 | Other: | ||||
Property, Plant and Equipment [Line Items] | ||||
Cash paid to acquire asset | $ 30,200 |
Revenue and Customers - Additional Information (Details) |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Payment term | P30D |
Revenue and Customers - Receivables, Contract Assets, and Contract Liabilities with Customers (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Revenue from Contract with Customer [Abstract] | ||
Current contract assets | $ 20,824 | $ 25,298 |
Noncurrent contract assets | 18,438 | 22,366 |
Total contract assets | 39,262 | 47,664 |
Current contract liabilities (deferred revenue) | (29,325) | (32,906) |
Noncurrent contract liabilities (deferred revenue) | (42,939) | (47,847) |
Total contract liabilities | $ (72,264) | $ (80,753) |
Revenue and Customers - Significant Changes in Contract Assets and Contract Liabilities (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Change In Contract With Customer, Asset And Liability [Roll Forward] | |
Contract assets, beginning balance | $ 47,664 |
Contract liabilities, beginning balance | (80,753) |
Amortization of deferred costs | (8,775) |
Additions to deferred costs | 373 |
Amortization of deferred revenue | 9,355 |
Additions to deferred revenue | (866) |
Total | (8,402) |
Total | 8,489 |
Contract assets, ending balance | 39,262 |
Contract liabilities, ending balance | $ (72,264) |
Revenue and Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 282,888 | $ 235,157 |
Floaters | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 153,154 | 120,636 |
Jackups | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 117,347 | 108,470 |
Contract drilling services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 270,501 | $ 229,106 |
Leases - Supplemental balance sheet information (Details) $ in Thousands |
Mar. 31, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
Operating lease right-of-use assets | $ 28,272 |
Current operating lease liabilities | 4,396 |
Long-term operating lease liabilities | $ 23,243 |
Weighted average remaining lease term for operating leases (years) | 9 years 1 month 12 days |
Weighted average discounted rate for operating leases | 9.60% |
Leases - Components of lease cost (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Operating lease cost | $ 1,859 |
Short-term lease cost | 2,052 |
Variable lease cost | 529 |
Total lease cost | $ 4,440 |
Leases - Supplemental cash flow information (Details) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Leases [Abstract] | |
Operating cash flows from operating leases | $ 2,200 |
Leases - Maturities of lease liabilities (Details) $ in Thousands |
Mar. 31, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 4,814 |
2020 | 5,917 |
2021 | 4,448 |
2022 | 3,618 |
2023 | 3,250 |
Thereafter | 22,335 |
Total lease payments | 44,382 |
Less: Interest | (16,743) |
Present value of lease liability | $ 27,639 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
|
Income Tax Disclosure [Abstract] | ||
Reserves for uncertain tax positions net | $ 195.1 | $ 183.8 |
Related tax benefits | $ 1.0 | $ 1.0 |
Operational period | 12 months |
Employee Benefit Plans (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Defined Benefit Plan Disclosure [Line Items] | ||
Employer contributions | $ 0 | $ 0 |
Service cost | 0 | 0 |
Non-U.S. | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | 445,000 | 465,000 |
Return on plan assets | (634,000) | (716,000) |
Recognized net actuarial gain | 3,000 | 0 |
Net pension benefit cost (gain) | (186,000) | (251,000) |
U.S. | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | 2,178,000 | 2,045,000 |
Return on plan assets | (2,578,000) | (2,979,000) |
Recognized net actuarial gain | 692,000 | 411,000 |
Net pension benefit cost (gain) | $ 292,000 | $ (523,000) |
Fair Value of Financial Instruments - Carrying Amount and Estimated Fair Value of Financial Instruments (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Quoted Prices in Active Markets (Level 1) | ||
Assets - | ||
Marketable securities | $ 7,359 | $ 8,659 |
Significant Other Observable Inputs (Level 2) | ||
Assets - | ||
Marketable securities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Assets - | ||
Marketable securities | 0 | 0 |
Carrying Amount | ||
Assets - | ||
Marketable securities | $ 7,359 | $ 8,659 |
Commitments and Contingencies (Details) $ in Thousands |
1 Months Ended | 3 Months Ended | |||
---|---|---|---|---|---|
Dec. 15, 2017
USD ($)
|
Jan. 31, 2017
Rig
|
Mar. 31, 2019
USD ($)
|
Mar. 31, 2018
USD ($)
|
May 02, 2017
USD ($)
|
|
Other Commitments [Line Items] | |||||
Number of newbuild rigs allegedly violating patents | Rig | 5 | ||||
Net loss from discontinued operations, net of tax | $ (3,821) | $ 0 | |||
Years of effectiveness of employment agreements after the termination of employment | 3 years | ||||
Minimum | |||||
Other Commitments [Line Items] | |||||
Percentage of uncertain tax positions likelihood of being sustained (greater than) | 50.00% | ||||
Income and other business taxes | Mexico | Foreign tax authority | |||||
Other Commitments [Line Items] | |||||
Approximate audit claims assessed | $ 51,900 | ||||
Paragon Offshore | |||||
Other Commitments [Line Items] | |||||
Litigation trust fund | $ 10,000 | ||||
Damages sought | $ 1,700,000 | ||||
Coverage limit | 150,000 | ||||
Paragon Offshore | Mexico | |||||
Other Commitments [Line Items] | |||||
Net loss from discontinued operations, net of tax | $ 3,800 |
Supplemental Financial Information - Additional Information (Details) - USD ($) $ in Millions |
1 Months Ended | |||||
---|---|---|---|---|---|---|
Feb. 28, 2019 |
Feb. 28, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Condensed Balance Sheet Statements, Captions [Line Items] | ||||||
Restricted cash | $ 1.3 | $ 0.7 | ||||
Capital expenditures incurred but not yet paid | $ 38.5 | $ 52.1 | $ 29.6 | $ 25.5 | ||
Seller-financed secured loan due February 2023 | ||||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||||
Financed value | $ 53.6 | $ 53.6 |
Supplemental Financial Information - Effect of Changes in Other Assets and Liabilities on Cash Flows from Operating Activities (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Operating Capital [Line Items] | ||
Total net change in assets and liabilities | $ (58,217) | $ (28,778) |
Noble-UK | ||
Operating Capital [Line Items] | ||
Accounts receivable | (11,007) | 22,892 |
Other current assets | 17,097 | 9,986 |
Other assets | 3,700 | (11,668) |
Accounts payable | (1,867) | 6,175 |
Other current liabilities | (59,685) | (58,860) |
Other liabilities | (6,455) | 2,697 |
Total net change in assets and liabilities | (58,217) | (28,778) |
Noble-Cayman | ||
Operating Capital [Line Items] | ||
Accounts receivable | (11,007) | 22,892 |
Other current assets | 16,803 | 9,699 |
Other assets | 4,506 | (10,552) |
Accounts payable | (1,676) | 6,175 |
Other current liabilities | (59,544) | (58,780) |
Other liabilities | (6,455) | 2,697 |
Total net change in assets and liabilities | $ (57,373) | $ (27,869) |
Label | Element | Value |
---|---|---|
Noble Corporation [Member] | ||
Tax Cuts And Jobs Act Of 2017, Reclassification From Aoci To Retained Earnings, Tax Effect | ne_TaxCutsAndJobsActOf2017ReclassificationFromAociToRetainedEarningsTaxEffect | $ 0 |
Retained Earnings [Member] | ||
Tax Cuts And Jobs Act Of 2017, Reclassification From Aoci To Retained Earnings, Tax Effect | ne_TaxCutsAndJobsActOf2017ReclassificationFromAociToRetainedEarningsTaxEffect | 5,540,000 |
Retained Earnings [Member] | Noble Corporation [Member] | ||
Tax Cuts And Jobs Act Of 2017, Reclassification From Aoci To Retained Earnings, Tax Effect | ne_TaxCutsAndJobsActOf2017ReclassificationFromAociToRetainedEarningsTaxEffect | 5,540,000 |
AOCI Attributable to Parent [Member] | Noble Corporation [Member] | ||
Tax Cuts And Jobs Act Of 2017, Reclassification From Aoci To Retained Earnings, Tax Effect | ne_TaxCutsAndJobsActOf2017ReclassificationFromAociToRetainedEarningsTaxEffect | $ (5,540,000) |
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