EX-99.1 2 d663820dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

Noble Corporation plc

10 Brook Street

London W1S 1BG

England

 

  

LOGO

 

PRESS RELEASE

NOBLE CORPORATION PLC REPORTS FOURTH QUARTER

AND FULL YEAR 2018 RESULTS

2018 HIGHLIGHTS AND RECENT ACCOMPLISHMENTS:

 

 

   

Best safety year on record

 

   

Record fleet performance with 97.3 percent uptime for the year

 

   

Contract backlog ends year at $2.4 billion

 

   

Exercised an option for the purchase of second newbuild jackup

 

   

Reactivation completed on three floating rigs and a jackup

 

   

Noble Tom Madden awarded one-year contract

 

   

75 percent of available days in jackup fleet already under contract in 2019

 

   

Floating fleet operating days increased 23 percent in the fourth quarter

LONDON, February 20, 2019 – Noble Corporation plc (NYSE: NE, the Company) today reported a net loss attributable to the Company for the three months ended December 31, 2018 (fourth quarter) of $33 million, or $0.13 per diluted share, on revenues of $310 million. Results for the fourth quarter included a discrete tax benefit and a gain from the retirement of debt, which together totaled $66 million, or $0.27 per diluted share, net of tax. These favorable items were partially offset by a loss of $9 million, or $0.04 per diluted share, resulting from the impairment of assets. Excluding the net favorable items, the net loss attributable to Noble Corporation plc for the three months ended December 31, 2018, would have been $90 million, or $0.36 per diluted share.

For the twelve months ended December 31, 2018, Noble Corporation plc reported a net loss attributable to the Company of $885 million, or $3.59 per diluted share, on revenues of $1.1 billion. Results for the year included net unfavorable items totaling $432 million, or $1.75 per diluted share, net of tax and non-controlling interests, related to asset impairments and the retirement of debt, partially offset by discrete tax items. Excluding the net unfavorable items, the net loss attributable to Noble Corporation plc for the twelve months ended December 31, 2018, would have been $453 million, or $1.84 per diluted share.

 

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Julie J. Robertson, Chairman, President and Chief Executive Officer of Noble Corporation plc, noted, “While 2018 was another challenging year, Noble set a second consecutive annual record for operational performance, registering 97.3 percent uptime across the fleet, while again establishing record metrics for safety. We achieved these important milestones while experiencing steady improvement in fleet activity, with utilization of both our floating and jackup fleets completing the fourth quarter of 2018 at their highest levels for the year. Also, we completed reactivation projects during the year on three floating units and a jackup, with a reactivation project on a fourth floating unit in progress as the year concluded. These rig reactivations position the Company to successfully compete to fill incremental customer needs in 2019.”

Contract drilling services revenues for the fourth quarter of 2018 totaled $292 million, a nine percent improvement when compared to revenues of $267 million in the preceding quarter of 2018. The growth in revenues was driven largely by higher fleet activity, led by the floating rig fleet where operating days improved 23 percent from the previous quarter. Also, revenues were supported by a reduction in fleet downtime, which declined to 2.1 percent in the fourth quarter (97.9 percent uptime) compared to fleet downtime of 5.2 percent in the preceding quarter of 2018. The improvement in fleet operating days drove total fleet utilization in the fourth quarter to 75 percent, the highest level experienced in 2018. The measure was up from 69 percent in the preceding quarter of 2018.

Contract drilling services costs for the fourth quarter of 2018 increased 10 percent to $179 million compared to $163 million in the preceding quarter of 2018. The increase was due largely to higher fleet activity, including increased operating days for the drillship Noble Tom Madden, the semisubmersible Noble Clyde Boudreaux and the jackup Noble Sam Hartley. Reactivation costs associated with the drillship Noble Sam Croft and other measures directed at elevating overall fleet readiness also contributed to the increase in costs. Contract drilling margin for the fourth quarter was 39 percent, unchanged from the preceding quarter in 2018.

Operating Highlights

Utilization in the fourth quarter of the Company’s floating rig fleet, consisting of eight drillships and four semisubmersibles, improved to 56 percent compared to 45 percent in the previous quarter of 2018, and 37 percent in the first quarter of 2018, which represented the lowest utilization

 

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measure for the floating fleet during the year. A 23 percent increase in floating fleet operating days, when compared to the third quarter, was largely driven by the semisubmersible Noble Clyde Boudreaux, following a full quarter of operations offshore Myanmar, and the drillship Noble Tom Madden, which, in October 2018, commenced operations offshore Guyana. Both rigs completed reactivation programs during the third and fourth quarters of 2018, respectively. Revenues for the floating fleet in the fourth quarter advanced 17 percent when compared to the previous quarter in 2018 following increased contributions from the semisubmersible Noble Clyde Boudreaux, as well as the drillships Noble Tom Madden, Noble Globetrotter II and Noble Don Taylor. The reactivation of the drillship Noble Sam Croft continued in the fourth quarter ahead of an expected first quarter 2019 contract commencement in the U.S. Gulf of Mexico, to be followed by a contract assignment in South America, which should commence by mid-2019. The Company began 2019 with eight of its nine actively marketed floating units under contract, amounting to 49 percent of the available days for the year.

Utilization in the fourth quarter of the Company’s jackup fleet, comprised of 12 active units, was 94 percent compared to 93 percent in the preceding quarter of 2018, and 56 percent in the first quarter, which represented the lowest measure in 2018. The slight improvement from the preceding quarter was due primarily to higher activity on the Noble Sam Hartley, which in October commenced operations in the North Sea following relocation of the rig from Southeast Asia. The improvement in activity was partially offset by the Noble Tom Prosser, which completed a contract offshore East Timor in November. The rig was idle for the remainder of the fourth quarter and into the first quarter of 2019 pending the completion of a five-year regulatory survey. The Noble Tom Prosser is expected to recommence operations in the near term offshore Australia and remain under contract into the first half of 2020. When compared to the third quarter, jackup revenues in the fourth quarter of 2018 were essentially flat. Following the close of the fourth quarter, the standard-duty jackup Noble Gene House, which completed a contract in late-December 2018, was retired from service. With the retirement of the Noble Gene House, the Company’s jackup fleet stands at 12 units, including the recently acquired jackup Noble Johnny Whitstine. As previously reported, the Company exercised an option to purchase a second newbuild jackup, the Noble Joe Knight, concurrent with the award of a three-year contract. The Company began 2019 with all 12 of its jackup rigs contracted, covering 75 percent of the available days in the year.

Backlog, Capital and Balance Sheet

At December 31, 2018, the Company’s contract backlog was $2.4 billion, with an estimated $1.5 billion related to the floating rig fleet and $926 million to the jackup fleet. Approximately $945 million of the backlog is attributable to the year 2019, with an estimated 62 percent of the available days in the year committed to contracts across the Noble fleet.

 

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Capital expenditures for the fourth quarter of 2018 were $61 million, of which $22 million was devoted to sustaining capital and $39 million related to fleet projects, reactivation programs and other projects. For the year 2018, capital expenditures totaled $221 million, which included $83 million in sustaining capital, $34 million related to the purchase of the Noble Johnny Whitstine and $104 million for fleet projects, reactivation programs and other projects. Capital expenditures associated with the purchase of the Noble Johnny Whitstine exclude $60 million of the rig’s purchase price, which was seller-financed. The Company expects capital expenditures for the full year of 2019 to total $250 million. This estimate includes $90 million in sustaining capital, $30 million related to the purchase of the Noble Joe Knight and $130 million for fleet projects, reactivation programs and other projects. The pending purchase of the Noble Joe Knight also includes $54 million with seller-financing similar to the Noble Johnny Whitstine, which is excluded from the full year 2019 capital estimate.

At December 31, 2018, cash and equivalents totaled $375 million compared to $326 million at the conclusion of the third quarter in 2018, while revolving credit facilities remained undrawn. Total debt at the conclusion of 2018 was $3.9 billion, essentially unchanged from the previous quarter.

Outlook

Ms. Robertson highlighted the strong geographic alignment of the Noble fleet and its positive implications for 2019. She stated, “As we commence the new year, 85 percent of our jackup fleet is, or will soon be operating in the North Sea and Middle East, two outstanding regions when we consider prospects for incremental jackup demand. Also, we expect to benefit from the presence of our floating rigs in the Western Hemisphere, where increased levels of exploration and growing customer activity are expected to drive additional rig needs, as demonstrated by the recent one-year contract award for the Noble Tom Madden offshore Guyana. Our regional alignment and continued operational excellence should lead to year-over-year improvement in total fleet operating days.”

A Non-GAAP supporting schedule is included with the statements and schedules attached to this press release and can also be found at www.noblecorp.com. It provides a reconciliation for revenues, net loss, income tax and diluted earnings per share for the fourth quarter 2018, fourth quarter of 2017 and full years 2018 and 2017.

 

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About Noble Corporation plc

Noble is a leading offshore drilling contractor for the oil and gas industry. The Company owns and operates one of the most modern, versatile and technically advanced fleets in the offshore drilling industry. Noble performs, through its subsidiaries, contract drilling services with a fleet of 24 offshore drilling units, consisting of 12 drillships and semisubmersibles and 12 jackups, focused largely on ultra-deepwater and high-specification jackup drilling opportunities in both established and emerging regions worldwide. Noble is a public limited company registered in England and Wales with company number 08354954 and registered office at 10 Brook Street, London, W1S 1BG England. Additional information on Noble is available at www.noblecorp.com.

Forward-looking Disclosure Statement

Statements regarding contract backlog, future earnings, costs, expense management, revenue, rig demand, fleet condition, operational or financial performance, shareholder value, contract commitments, dayrates, contract commencements, contract extensions, renewals or renegotiations, rig reactivations, shipyard risks and timing of shipyard deliveries, delays in mobilization of rigs, letters of intent or award, industry fundamentals, customer relationships and requirements, strategic initiatives, future performance, growth opportunities, the offshore drilling market, market outlook, capital allocation strategies, our financial position, business strategy, taxes and tax rates, liquidity, competitive position, capital expenditures, financial flexibility, debt levels, debt repayment, the outcome of any dispute, litigation, audit or investigation, as well as any other statements that are not historical facts in this release, are forward-looking statements that involve certain risks, uncertainties and assumptions. These include but are not limited to operating hazards and delays, risks associated with operations outside of the U.S., actions or claims by regulatory authorities, customers and other third parties, legislation and regulations affecting drilling operations, compliance with regulatory requirements, factors affecting the level of activity in the oil and gas industry, supply and demand of drilling rigs, factors affecting the duration of contracts, the actual amount of downtime, factors that reduce applicable dayrates, violations of anti-corruption laws, hurricanes and other weather conditions, market conditions, the future price of oil and gas and other factors detailed in the Company’s most recent Form 10-K, Form 10-Q’s and other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated.

 

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Conference Call

Noble also has scheduled a conference call and webcast related to its fourth quarter and full year 2018 results on Thursday, February 21, 2019, at 8:00 a.m. U.S. Central Standard Time. Interested parties are invited to listen to the call by dialing 1-833-245-9653, or internationally 1-647-689-4225, using access code: 6556717, or by asking for the Noble Corporation plc conference call. Interested parties may also listen over the Internet through a link posted in the Investor Relations section of the Company’s Website.

A replay of the conference call will be available on Thursday, February 21, 2019, beginning at 1:00 p.m. U.S. Central Standard Time, through Saturday, March 23, 2019, ending at 11:00 p.m. U.S. Central Daylight Time. The phone number for the conference call replay is 1-800-585-8367 or, for calls from outside of the U.S., 1-416-621-4642, using access code: 6556717. The replay will also be available on the Company’s Website following the end of the live call.

For additional information, contact:

Jeffrey L. Chastain,

Vice President – Investor Relations and Corporate Communications,

Noble Drilling Services Inc., 281-276-6383, or at jlchastain@noblecorp.com

 

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NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

 

         Three Months Ended December 31,             Twelve Months Ended December 31,      
     2018     2017     2018     2017  

Operating revenues

        

Contract drilling services

   $ 292,049     $ 321,095     $ 1,036,082     $ 1,207,026  

Reimbursables and other

     17,843       8,490       46,744       29,889  
  

 

 

   

 

 

   

 

 

   

 

 

 
     309,892       329,585       1,082,826       1,236,915  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses

        

Contract drilling services

     178,666       153,343       629,937       642,937  

Reimbursables

     14,761       5,061       37,084       18,435  

Depreciation and amortization

     114,226       138,071       486,530       547,990  

General and administrative

     14,694       21,765       73,216       71,634  

Loss on impairment

     9,290       121,639       802,133       121,639  
  

 

 

   

 

 

   

 

 

   

 

 

 
     331,637       439,879       2,028,900       1,402,635  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

     (21,745     (110,294     (946,074     (165,720

Other income (expense)

        

Interest expense, net of amount capitalized

     (73,741     (72,446     (297,611     (291,989

Gain (loss) on extinguishment of debt, net

     6,866       —         (1,793     —    

Interest income and other, net

     1,488       1,801       8,302       7,897  
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from continuing operations before income taxes

     (87,132     (180,939     (1,237,176     (449,812

Income tax benefit (provision)

     56,307       167,960       106,641       (42,629
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss from continuing operations

     (30,825     (12,979     (1,130,535     (492,441

Net loss from discontinued operations, net of tax

     —         —         —         (1,486
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

     (30,825     (12,979     (1,130,535     (493,927

Net (income) loss attributable to noncontrolling interests

     (2,237     (11,696     245,485       (22,584
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (33,062   $ (24,675   $ (885,050   $ (516,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

        

Loss from continuing operations

   $ (33,062   $ (24,675   $ (885,050   $ (515,025

Net loss from discontinued operations, net of tax

     —         —         —         (1,486
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (33,062   $ (24,675   $ (885,050   $ (516,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Per share data

        

Basic:

        

Loss from continuing operations

   $ (0.13   $ (0.10   $ (3.59   $ (2.10

Loss from discontinued operations

     —         —         —         (0.01
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.13   $ (0.10   $ (3.59   $ (2.11
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted:

        

Loss from continuing operations

   $ (0.13   $ (0.10   $ (3.59   $ (2.10

Loss from discontinued operations

     —         —         —         (0.01
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.13   $ (0.10   $ (3.59   $ (2.11
  

 

 

   

 

 

   

 

 

   

 

 

 


NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

         December 31,    
2018
        December 31,    
2017
 
ASSETS  

Current assets

    

Cash and cash equivalents

   $ 375,232     $ 662,829  

Accounts receivable, net

     200,722       204,696  

Prepaid expenses and other current assets

     83,102       171,450  
  

 

 

   

 

 

 

Total current assets

     659,056       1,038,975  
  

 

 

   

 

 

 

Property and equipment, at cost

     10,956,412       12,034,331  

Accumulated depreciation

     (2,475,694     (2,545,091
  

 

 

   

 

 

 

Property and equipment, net

     8,480,718       9,489,240  
  

 

 

   

 

 

 

Other assets

     125,149       266,444  
  

 

 

   

 

 

 

Total assets

   $ 9,264,923     $ 10,794,659  
  

 

 

   

 

 

 
LIABILITIES AND EQUITY  

Current liabilities

    

Current maturities of long-term debt

   $ —       $ 249,843  

Accounts payable

     125,557       84,032  

Accrued payroll and related costs

     50,284       54,904  

Other current liabilities

     189,616       204,245  
  

 

 

   

 

 

 

Total current liabilities

     365,457       593,024  
  

 

 

   

 

 

 

Long-term debt

     3,877,402       3,795,867  

Other liabilities

     367,490       455,140  
  

 

 

   

 

 

 

Total liabilities

     4,610,349       4,844,031  
  

 

 

   

 

 

 

Commitments and contingencies

    

Equity

    

Total shareholders’ equity

     4,253,171       5,276,161  

Noncontrolling interests

     401,403       674,467  
  

 

 

   

 

 

 

Total equity

     4,654,574       5,950,628  
  

 

 

   

 

 

 

Total liabilities and equity

   $ 9,264,923     $ 10,794,659  
  

 

 

   

 

 

 


NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

         Twelve Months Ended December 31,      
     2018      2017  

Cash flows from operating activities

     

Net loss

   $ (1,130,535    $ (493,927

Adjustments to reconcile net loss to net cash flow from operating activities:

     

Depreciation and amortization

     486,530        547,990  

Loss on impairment

     802,133        121,639  

Loss on extinguishment of debt, net

     1,793        —    

Deferred income taxes

     (68,416      241,326  

Other long-term asset write-off

     —          29,032  

Changes in components of working capital:

     

Change in taxes receivable

     84,847        (49,865

Net changes in other operating assets and liabilities

     (4,501      20,480  
  

 

 

    

 

 

 

Net cash provided by operating activities

     171,851        416,675  
  

 

 

    

 

 

 

Cash flows from investing activities

     

Capital expenditures

     (194,779      (120,707

Proceeds from disposal of assets, net

     5,402        2,382  
  

 

 

    

 

 

 

Net cash used in investing activities

     (189,377      (118,325
  

 

 

    

 

 

 

Cash flows from financing activities

     

Issuance of senior notes

     750,000        —    

Repayments of debt

     (972,708      (300,000

Debt issuance costs on senior notes and credit facilities

     (15,639      (42

Dividends paid to noncontrolling interests

     (27,579      (56,881

Taxes withheld on employee stock transactions

     (3,470      (4,320
  

 

 

    

 

 

 

Net cash used in financing activities

     (269,396      (361,243
  

 

 

    

 

 

 

Net decrease in cash and cash equivalents

     (286,922      (62,893

Cash, cash equivalents and restricted cash, beginning of period

     662,829        725,722  
  

 

 

    

 

 

 

Cash, cash equivalents and restricted cash, end of period

   $ 375,907      $ 662,829  
  

 

 

    

 

 

 


NOBLE CORPORATION PLC AND SUBSIDIARIES

FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT

(In thousands, except operating statistics)

(Unaudited)

 

     Three Months Ended December 31,     Three Months Ended September 30,  
     2018     2017     2018  
     Contract
Drilling
Services
    Other     Total     Contract
Drilling
Services
    Other     Total     Contract
Drilling
Services
    Other     Total  

Operating revenues

                  

Contract drilling services

   $ 292,049     $ —       $ 292,049     $ 321,095     $ —       $ 321,095     $ 267,238     $ —       $ 267,238  

Reimbursables and other

     17,843       —         17,843       8,490       —         8,490       12,170       —         12,170  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 309,892     $ —       $ 309,892     $ 329,585     $ —       $ 329,585     $ 279,408     $ —       $ 279,408  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses

                  

Contract drilling services

   $ 178,666     $ —       $ 178,666     $ 153,343     $ —       $ 153,343     $ 162,985     $ —       $ 162,985  

Reimbursables

     14,761       —         14,761       5,061       —         5,061       9,676       —         9,676  

Depreciation and amortization

     110,372       3,854       114,226       132,392       5,679       138,071       109,492       4,376       113,868  

General and administrative

     14,694       —         14,694       21,765       —         21,765       14,722       —         14,722  

Loss on impairment

     9,290       —         9,290       121,639       —         121,639       —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 327,783     $ 3,854     $ 331,637     $ 434,200     $ 5,679     $ 439,879     $ 296,875     $ 4,376     $ 301,251  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

   $ (17,891   $ (3,854   $ (21,745   $ (104,615   $ (5,679   $ (110,294   $ (17,467   $ (4,376   $ (21,843
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating statistics

                  

Jackups:

                  

Average Rig Utilization

     94         76         93    

Operating Days

     1,037           971           1,028      

Average Dayrate

   $ 121,949         $ 134,413         $ 122,350      

Semisubmersibles:

                  

Average Rig Utilization

     25         17         11    

Operating Days

     92           92           42      

Average Dayrate

   $ 112,434         $ 261,661         $ 99,470      

Drillships:

                  

Average Rig Utilization

     72         60         63    

Operating Days

     527           440           460      

Average Dayrate

   $ 294,864         $ 378,709         $ 298,443      

Total:

                  

Average Rig Utilization

     75         58         69    

Operating Days

     1,655           1,503           1,530      

Average Dayrate

   $ 176,443         $ 213,664         $ 174,665      


NOBLE CORPORATION PLC AND SUBSIDIARIES

CALCULATION OF BASIC AND DILUTED NET INCOME (LOSS) PER SHARE

(In thousands, except per share amounts)

(Unaudited)

 

         Three Months Ended December 31,             Twelve Months Ended December 31,      
     2018     2017     2018     2017  

Numerator:

        

Basic

        

Net loss from continuing operations

   $ (33,062   $ (24,675   $ (885,050   $ (515,025

Net loss from discontinued operations, net of tax

     —         —         —         (1,486
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (33,062   $ (24,675   $ (885,050   $ (516,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

        

Net loss from continuing operations

   $ (33,062   $ (24,675   $ (885,050   $ (515,025

Net loss from discontinued operations, net of tax

     —         —         —         (1,486
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (33,062   $ (24,675   $ (885,050   $ (516,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Denominator:

        

Weighted average shares outstanding—basic

     246,793       244,970       246,614       244,743  

Weighted average shares outstanding—diluted

     246,793       244,970       246,614       244,743  

Loss per share

        

Basic:

        

Loss from continuing operations

   $ (0.13   $ (0.10   $ (3.59   $ (2.10

Loss from discontinued operations

     —         —         —         (0.01
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.13   $ (0.10   $ (3.59   $ (2.11
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted:

        

Loss from continuing operations

   $ (0.13   $ (0.10   $ (3.59   $ (2.10

Loss from discontinued operations

     —         —         —         (0.01
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.13   $ (0.10   $ (3.59   $ (2.11
  

 

 

   

 

 

   

 

 

   

 

 

 


NOBLE CORPORATION PLC AND SUBSIDIARIES

NON-GAAP RECONCILIATION

Certain non-GAAP performance measures and corresponding reconciliations to GAAP financial measures for the Company have been provided for meaningful comparisons between current results and prior operating periods. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. In order to fully assess the financial operating results, management believes that the results of operations, adjusted to exclude the following items, which are included in the Company’s press release issued on February 20, 2019, and discussed in the related conference call on February 21, 2019, are appropriate measures of the continuing and normal operations of the Company:

 

  (i)

In the first and fourth quarter of 2018, a loss on debt extinguishment;

 

  (ii)

In the second quarter of 2018, an impairment of three of our rigs and certain capital spares equipment;

 

  (iii)

In the third and fourth quarter of 2018, discrete tax benefits; and

 

  (iv)

In the fourth quarter of 2018, an impairment of two of our rigs.

These non-GAAP adjusted measures should be considered in addition to, and not as a substitute for, or superior to, contract drilling revenue, contract drilling cost, contract drilling margin, average daily revenue, operating income, cash flows from operations, or other measures of financial performance prepared in accordance with GAAP. Please see the following Non-GAAP Financial Measures and Reconciliations for a complete description of the adjustments.


NOBLE CORPORATION PLC AND SUBSIDIARIES

NON-GAAP RECONCILIATION

(In thousands, except per share amounts)

(Unaudited)

 

Reconciliation of Income Tax Benefit (Provision)        Three Months Ended    
December 31,
        Twelve Months Ended    
December 31,
 
     2018     2017     2018     2017  

Income tax benefit (provision)

   $ 56,307     $ 167,960     $ 106,641     $ (42,629

Adjustments

        

Noble Danny Adkins and Noble Jim Day rig damages

     —         —         —         (4,845

Noble Jim Day—Marathon Settlement

     —         4,003       —         4,003  

Noble Bully II—Shell Escalation Provision

     —         380       —         380  

Loss on impairment

     —         (26,819     (35,613     (26,819

Gain (loss) on debt extinguishment

     1,442       —         (399     —    

Discrete tax items

     (60,568     (120,821     (85,492     139,264  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Adjustments

     (59,126     (143,257     (121,504     111,983  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted income tax benefit (provision)

   $ (2,819   $ 24,703     $ (14,863   $ 69,354  
  

 

 

   

 

 

   

 

 

   

 

 

 
Reconciliation of Net Loss Attributable to Noble Corporation plc        Three Months Ended    
December 31,
        Twelve Months Ended    
December 31,
 
     2018     2017     2018     2017  

Net loss attributable to Noble Corporation plc

   $ (33,062   $ (24,675   $ (885,050   $ (516,511

Adjustments

        

Noble Max Smith—write-off of receivables

     —         —         —         14,419  

Noble Danny Adkins and Noble Jim Day rig damages

     —         —         —         9,425  

Noble Jim Day—Marathon Settlement

     —         (8,706     —         (8,706

Noble Bully II—Shell Escalation Provision

     —         (12,473       (12,473

Loss on impairment

     9,290       94,820       766,520       94,820  

(Gain) loss on debt extinguishment

     (5,424           1,503       —    

Discrete tax items

     (60,568     (120,821     (85,492     139,264  

Net loss attributable to noncontrolling interests

     —               (250,348     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Adjustments

     (56,702     (47,180     432,183       236,749  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net loss attributable to Noble Corporation plc

   $ (89,764   $ (71,855   $ (452,867   $ (279,762
  

 

 

   

 

 

   

 

 

   

 

 

 
Reconciliation of Diluted EPS Attributable to Noble Corporation plc        Three Months Ended    
December 31,
        Twelve Months Ended    
December 31,
 
     2018     2017     2018     2017  

Unadjusted diluted EPS attributable to Noble Corporation plc

   $ (0.13   $ (0.10   $ (3.59   $ (2.11

Adjustments

        

Noble Max Smith—write-off of receivables

     —         —         —         0.06  

Noble Danny Adkins and Noble Jim Day rig damages

     —         —         —         0.04  

Noble Jim Day—Marathon Settlement

     —         (0.04     —         (0.04

Noble Bully II—Shell Escalation Provision

     —         (0.05     —         (0.05

Loss on impairment

     0.04       0.39       2.09       0.39  

(Gain) loss on debt extinguishment

     (0.02       0.01       —    

Discrete tax items

     (0.25     (0.49     (0.35     0.57  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Adjustments

     (0.23     (0.19     1.75       0.97  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted diluted EPS attributable to Noble Corporation plc

   $ (0.36   $ (0.29   $ (1.84   $ (1.14