Borr Drilling Limited | ||||||||
(Registrant) | ||||||||
By: | /s/ Patrick Schorn | |||||||
Name: | Patrick Schorn | |||||||
August 31, 2021 | Title: | Principal Executive Officer |
Six months ended June 30, | ||||||||||||||
In $ millions | 2021 | 2020 | Change | % Change | ||||||||||
Total operating revenues | 103.2 | 188.1 | (84.9) | (45) | % | |||||||||
Gain on disposals | 0.7 | 13.1 | (12.4) | (95) | % | |||||||||
Rig operating and maintenance expenses | (96.2) | (153.1) | 56.9 | (37) | % | |||||||||
Depreciation of non-current assets | (54.8) | (59.9) | 5.1 | (9) | % | |||||||||
Impairment of non-current assets | — | (76.3) | 76.3 | (100) | % | |||||||||
General and administrative expenses | (19.5) | (29.9) | 10.4 | (35) | % | |||||||||
Total operating expenses | (170.5) | (319.2) | 148.7 | (47) | % | |||||||||
Operating Loss | (66.6) | (118.0) | 51.4 | (44) | % | |||||||||
Income from equity method investments | 10.3 | 8.5 | 1.8 | 21 | % | |||||||||
Total financial expenses, net | (56.7) | (77.5) | 20.8 | (27) | % | |||||||||
Loss before income taxes | (113.0) | (187.0) | 74.0 | (40) | % | |||||||||
Income tax expense | (1.3) | (9.6) | 8.3 | (86) | % | |||||||||
Net loss | (114.3) | (196.6) | 82.3 | (42) | % |
Six months ended June 30, | ||||||||||||||
In $ millions | 2021 | 2020 | Change | % Change | ||||||||||
Net loss | (114.3) | (196.6) | 82.3 | (42) | % | |||||||||
Depreciation of non-current assets | 54.8 | 59.9 | (5.1) | (9) | % | |||||||||
Impairment of non-current assets | — | 76.3 | (76.3) | (100) | % | |||||||||
(Income) / loss from equity method investments | (10.3) | (8.5) | (1.8) | 21 | % | |||||||||
Total financial expenses, net | 56.7 | 77.5 | (20.8) | (27) | % | |||||||||
Income tax | 1.3 | 9.6 | (8.3) | (86) | % | |||||||||
Amortization of mobilization costs | 7.5 | 13.9 | (6.4) | (46) | % | |||||||||
Amortization of mobilization revenue | (2.7) | (8.6) | 5.9 | (69) | % | |||||||||
Adjusted EBITDA | (7.0) | 23.5 | (30.5) | (130) | % |
Hayfin Term Loan Facility | Syndicated Senior Secured Credit Facilities | New Bridge Revolving Credit Facility | |||||||||
Maturity dates | Extended to January 2023 | Extended to January 2023 | Extended to January 2023 | ||||||||
Amortizations | Not applicable | Extended to January 2023 | Extended to January 2023 | ||||||||
Interest payments | Not amended | Q3 2020 and Q4 2020 interest payments deferred by one year to 2021 | Q3 2020 and Q4 2020 interest payments deferred by one year to 2021 | ||||||||
Extension fees | 1% of total commitments ($1.95 million), added to the loan principal. | 1% of total commitments ($2.7 million), added to the loan principal. | 1% of total commitments ($0.3 million), added to the loan principal | ||||||||
Covenant terms: | |||||||||||
Minimum liquidity requirements | Not amended | Cash requirement: $5 million until December 31, 2021; $10 million from and including January 1, 2022 to and including June 30, 2022; $15 million from and including July 1, 2022 | Cash requirement: $5 million until December 31, 2021; $10 million from and including January 1, 2022 to and including June 30, 2022; $15 million from and including July 1, 2022 | ||||||||
Restricted cash requirements | No requirement through to September 2021. From October 1, 2021 - three months interest payments for rigs which are not operating on a contract | Not applicable | Not applicable | ||||||||
Debt service cover ratio | Not applicable | Waived until final maturity | Waived until final maturity | ||||||||
Book to equity ratio 2021 | Not applicable | 25% | 25% | ||||||||
Book to equity ratio 2022 | Not applicable | 30% | 30% | ||||||||
Book to equity ratio 2023 | Not applicable | 35% | 35% | ||||||||
Value to loan ratio (1) | 140% | 140% | 140% |
PPL Newbuild Financing | Keppel H-Rigs Financing | |||||||
Interim payments required 2021 | $6 million | $6 million | ||||||
Interim payments required 2022 | $12 million | $12 million | ||||||
Maturity | Date for repayment of the seller's credit on the rigs are amended to May 2023 | The loans for the three delivered rigs are extended by one year, until 2025 and 2026 | ||||||
Interest payments | No cash interest payments until March 2023 | First interest payment date deferred from third anniversary to May 2023 and second interest payment date deferred to the fourth anniversary of each loan (delivered rigs) | ||||||
Covenant terms: | ||||||||
Minimum liquidity requirements | Cash requirement: $5 million until December 31, 2021; $10 million from and including January 1, 2022 to and including June 30, 2022; $15 million from and including July 1, 2022 | Not applicable | ||||||
Value to loan | Requirement to provide additional security if the value of any rigs fall below $70 million in 2021, $75 million in 2022 or $80 million thereafter | Not amended |
Six months ended June 30, | ||||||||||||||
In $ millions | 2021 | 2020 | Change | % Change | ||||||||||
Net cash used in operating activities | (27.6) | (10.5) | (17.1) | 163 | % | |||||||||
Net cash used in investing activities | (4.0) | (117.2) | 113.2 | (97) | % | |||||||||
Net cash provided by financing activities | 44.8 | 33.8 | 11.0 | 33 | % | |||||||||
Net increase / (decrease) in cash and cash equivalents | 13.2 | (93.9) | 107.1 | (114) | % | |||||||||
Cash and cash equivalents at beginning of period | 19.2 | 128.5 | (109.3) | (85) | % | |||||||||
Cash and cash equivalents at end of period | 32.4 | 34.6 | (2.2) | (6) | % |
Non GAAP Measure | Closest Equivalent to GAAP Measure | Definition | Rationale for Presentation of this non-GAAP Measure | ||||||||
Adjusted EBITDA | Net loss attributable to shareholders of Borr Drilling Limited | Net loss adjusted for: depreciation and impairment of non-current assets, amortization of contract backlog, income/(loss) from equity method investments, interest income, interest capitalized to newbuildings, foreign exchange loss (gain), net, other financial expenses, interest expense, gross, change in unrealized loss on call spread transactions , (loss)/gain on forward contracts, gain from bargain purchase, amortized mobilization costs, amortized mobilization revenue, and income tax expense | Increases the comparability of total business performance from period to period and against the performance of other companies by excluding the results of our equity investments, removing the impact of unrealized movements and removing the impact of depreciation, financing and tax items. | ||||||||
Page | ||||||||||||||
Unaudited Consolidated Statements of Operations for the three months and six months ended June 30, 2021 and 2020 | ||||||||||||||
Unaudited Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020 | ||||||||||||||
Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020 | ||||||||||||||
Unaudited Consolidated Statements of Changes in Shareholders' Equity for the three and six months ended June 30, 2021 and 2020 | ||||||||||||||
Notes to the Unaudited Consolidated Financial Statements |
Notes | 3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||||
Operating revenues | |||||||||||||||||
Dayrate revenue | 4 | ||||||||||||||||
Related party revenue | 4, 17 | ||||||||||||||||
Total operating revenues | |||||||||||||||||
Gain on disposal | 12 | ||||||||||||||||
Operating expenses | |||||||||||||||||
Rig operating and maintenance expenses | ( | ( | ( | ( | |||||||||||||
Depreciation of non-current assets | 12 | ( | ( | ( | ( | ||||||||||||
Impairment of non-current assets | 12 | ( | ( | ||||||||||||||
General and administrative expenses | ( | ( | ( | ( | |||||||||||||
Total operating expenses | ( | ( | ( | ( | |||||||||||||
Operating loss | ( | ( | ( | ( | |||||||||||||
(Loss) / income from equity method investments | 6 | ( | |||||||||||||||
Financial income (expenses), net | |||||||||||||||||
Interest income | |||||||||||||||||
Interest expense, net of amounts capitalized | ( | ( | ( | ( | |||||||||||||
Other financial expenses, net | 7 | ( | ( | ( | ( | ||||||||||||
Total financial expenses, net | ( | ( | ( | ( | |||||||||||||
Loss before income taxes | ( | ( | ( | ( | |||||||||||||
Income tax credit/(expense) | 8 | ( | ( | ( | |||||||||||||
Net loss attributable to shareholders of Borr Drilling Limited | ( | ( | ( | ( | |||||||||||||
Total comprehensive loss attributable to shareholders of Borr Drilling Limited | ( | ( | ( | ( | |||||||||||||
Basic and diluted loss per share | 9 | ( | ( | ( | ( | ||||||||||||
Weighted-averages shares outstanding | |||||||||||||||||
Notes | June 30, 2021 | December 31, 2020 | |||||||||
ASSETS | Unaudited | Audited | |||||||||
Current assets | |||||||||||
Cash and cash equivalents | |||||||||||
Trade receivables | 10 | ||||||||||
Jack-up drilling rigs held for sale | 12 | ||||||||||
Prepaid expenses | |||||||||||
Deferred mobilization and contract preparation costs | 5 | ||||||||||
Accrued revenue | 5 | ||||||||||
Tax retentions receivable | |||||||||||
Due from related parties | 17 | ||||||||||
Other current assets | 11 | ||||||||||
Total current assets | |||||||||||
Non-current assets | |||||||||||
Property, plant and equipment | |||||||||||
Jack-up rigs | 12 | ||||||||||
Newbuildings | |||||||||||
Equity method investments | 6 | ||||||||||
Other non-current assets | 13 | ||||||||||
Total non-current assets | |||||||||||
Total assets | |||||||||||
LIABILITIES AND EQUITY | |||||||||||
Current liabilities | |||||||||||
Trade payables | |||||||||||
Accrued expenses | |||||||||||
Other current liabilities | 14 | ||||||||||
Total current liabilities | |||||||||||
Non-current liabilities | |||||||||||
Long-term debt | 15 | ||||||||||
Other liabilities | |||||||||||
Long-term accrued interest | |||||||||||
Onerous contracts | |||||||||||
Total non-current liabilities | |||||||||||
Total liabilities | |||||||||||
Shareholders’ Equity | |||||||||||
Common shares of par value $ | 19 | ||||||||||
Additional paid in capital | |||||||||||
Treasury shares | ( | ( | |||||||||
Accumulated deficit | ( | ( | |||||||||
Total equity | |||||||||||
Total liabilities and equity | |||||||||||
Notes | 3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||||
Cash Flows from Operating Activities | |||||||||||||||||
Net loss | ( | ( | ( | ( | |||||||||||||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||||||||
Non-cash compensation expense related to stock options | |||||||||||||||||
Depreciation of non-current assets | 12 | ||||||||||||||||
Impairment of non-current assets | |||||||||||||||||
Gain on disposal of assets | 12 | ( | ( | ( | ( | ||||||||||||
Amortization of deferred finance charges | 15 | ||||||||||||||||
Effective Interest rate adjustments | 15 | ||||||||||||||||
Change in fair value of financial instruments | 7 | ( | |||||||||||||||
Loss/(income) from equity method investments | 6 | ( | ( | ( | |||||||||||||
Deferred income tax | 8 | ( | ( | ( | |||||||||||||
Change in assets and liabilities: | |||||||||||||||||
Amounts due to/from related parties | ( | ( | |||||||||||||||
Accrued expenses | ( | ||||||||||||||||
Long-term accrued interest | |||||||||||||||||
Other current and non-current assets | ( | ||||||||||||||||
Other current and non-current liabilities | ( | ||||||||||||||||
Net cash used in operating activities | ( | ( | ( | ( | |||||||||||||
Cash Flows from Investing Activities | |||||||||||||||||
Proceeds from sale of fixed assets | 12 | ||||||||||||||||
Purchase of marketable securities | ( | ( | |||||||||||||||
Investments in equity method investments | 6 | ( | ( | ( | |||||||||||||
Proceeds from sale of marketable securities | |||||||||||||||||
Additions to newbuildings | ( | ( | |||||||||||||||
Additions to jack-up rigs | 12 | ( | ( | ( | ( | ||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | |||||||||||||
Cash Flows from Financing Activities | |||||||||||||||||
Proceeds from share issuance, net of issuance cost | 19 | ||||||||||||||||
Proceeds, net of deferred loan cost, from issuance of long-term debt | 15 | ||||||||||||||||
Net cash provided by financing activities | |||||||||||||||||
— | — | — | — | ||||||||||||||
Net (decrease) increase in cash, cash equivalents and restricted cash | ( | ( | ( | ||||||||||||||
Cash, cash equivalents and restricted cash at the beginning of the period | |||||||||||||||||
Cash and cash equivalents at the end of period | |||||||||||||||||
Supplementary disclosure of cash flow information | — | — | |||||||||||||||
Interest paid, net of capitalized interest | ( | ( | ( | ( | |||||||||||||
Income taxes refunded (paid), net | ( | ( | |||||||||||||||
Issuance of long-term debt as non-cash settlement for newbuild delivery installment | |||||||||||||||||
In millions of $ | Number of outstanding shares | Common shares | Treasury shares | Additional paid in capital | Accumulated Deficit | Non-controlling interest | Total equity | ||||||||||||||||
Balance as at December 31, 2019 | ( | ( | |||||||||||||||||||||
— | — | — | — | ( | — | ( | |||||||||||||||||
Adjusted balance at January 1, 2020 | ( | ( | |||||||||||||||||||||
Share-based compensation | — | — | — | — | — | ||||||||||||||||||
Total comprehensive loss | — | — | — | — | ( | — | ( | ||||||||||||||||
Other, net | — | — | — | — | — | ||||||||||||||||||
Balance as at March 31, 2020 | ( | ( | |||||||||||||||||||||
Issue of common shares | — | — | — | ||||||||||||||||||||
Equity issuance costs | — | — | — | ( | — | — | ( | ||||||||||||||||
Share-based compensation | — | — | — | — | — | ||||||||||||||||||
Total comprehensive loss | — | — | — | — | ( | — | ( | ||||||||||||||||
Other, net | — | — | — | — | ( | — | ( | ||||||||||||||||
Consolidated balance at June 30, 2020 | ( | ( | |||||||||||||||||||||
In millions of $ | Number of outstanding shares | Common shares | Treasury shares | Additional paid in capital | Accumulated Deficit | Non-controlling interest | Total equity | ||||||||||||||||
Balance as at December 31, 2020 | ( | ( | |||||||||||||||||||||
Issue of common shares | — | — | — | ||||||||||||||||||||
Equity issue costs | — | — | — | ( | — | — | ( | ||||||||||||||||
Share based compensation | — | ( | — | — | |||||||||||||||||||
Total comprehensive loss | — | — | — | — | ( | — | ( | ||||||||||||||||
Balance as at March 31, 2021 | ( | ( | |||||||||||||||||||||
Share based compensation | — | — | — | — | — | ||||||||||||||||||
Total comprehensive loss | — | — | — | — | ( | — | ( | ||||||||||||||||
Balance as at June 30, 2021 | ( | ( | |||||||||||||||||||||
Standard | Description | Date of Adoption | Effect on our Consolidated Financial Statements or Other Significant Matters | ||||||||
ASU 2020-04 Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-01 Reference Rate Reform (Topic 848) | The amendments provide temporary optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The applicable expedients for us are in relation to modifications of contracts within the scope of Topics 310, Receivables, 470, Debt, and 842, Leases. This optional guidance may be applied prospectively from any date beginning March 12, 2020 and cannot be applied to modifications that occur after December 31, 2022. | January 1, 2022 | Under evaluation | ||||||||
ASU 2020-06 Debt - Debt with Conversion and Other Options (Topic 470) and Derivatives and Hedging - Contracts in Entity's Own Equity (Topic 815) | The amendments simplify the issuer’s accounting for convertible instruments and its application of the equity classification guidance. The new guidance eliminates some of the existing models for assessing convertible instruments, which results in more instruments being recognized as a single unit of account on the balance sheet and expands disclosure requirements. The new guidance simplifies the assessment of contracts in an entity’s own equity and existing EPS guidance in ASC 260. | January 1, 2022 | Under evaluation | ||||||||
ASU 2021-04 Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) | The amendments clarify the issuer's recognition and measurement considerations resulting from exchanges or modifications to freestanding instruments (written call options) classified in equity. Such exchanges or modifications are treated as adjustments to the cost to raise debt, to the cost to raise equity or as share based payments (ASC 718) when issued to compensate for goods or services. If not treated as costs of debt funding, equity funding or share-based payments, it results in an adjustment to EPS/net income (loss). Holder's accounting is not affected by these amendments. | January 1, 2022 | Under evaluation |
(In $ millions) | Dayrate | IWS | Reconciling items (1) | Consolidated total | ||||||||||
Revenue | ( | |||||||||||||
Related party revenue | ||||||||||||||
Intersegment revenue | ( | |||||||||||||
Gain on disposal | ||||||||||||||
Rig operating and maintenance expenses | ( | ( | ( | |||||||||||
Intersegment expenses | ( | |||||||||||||
Depreciation of non-current assets | ( | ( | ( | |||||||||||
General and administrative expenses | ( | ( | ||||||||||||
Loss from equity method investments | ( | ( | ||||||||||||
Operating loss including equity method investment | ( | ( | ( | ( | ||||||||||
Total assets | ( |
(in $ millions) | Dayrate | IWS | Reconciling items (1) | Consolidated total | ||||||||||
Revenue | ( | |||||||||||||
Related party revenue | ||||||||||||||
Intersegment revenue | ( | |||||||||||||
Gain on disposal | ||||||||||||||
Rig operating and maintenance expenses | ( | ( | ( | |||||||||||
Intersegment expenses | ( | |||||||||||||
Depreciation of non-current assets | ( | ( | ( | |||||||||||
Impairment of non-current assets | ( | ( | ||||||||||||
General and administrative expenses | ( | ( | ||||||||||||
Income from equity method investments | ||||||||||||||
Operating (loss)/income including equity method investment | ( | ( | ( | |||||||||||
Total assets | ( |
(In $ millions) | Dayrate | IWS | Reconciling items (1) | Consolidated total | ||||||||||
Revenue | ( | |||||||||||||
Related party revenue | ||||||||||||||
Intersegment revenue | ( | |||||||||||||
Gain on disposal | ||||||||||||||
Rig operating and maintenance expenses | ( | ( | ( | |||||||||||
Intersegment expenses | ( | |||||||||||||
Depreciation of non-current assets | ( | ( | ( | |||||||||||
General and administrative expenses | ( | ( | ||||||||||||
Income from equity method investments | ||||||||||||||
Operating (loss)/income including equity method investment | ( | ( | ( | |||||||||||
(in $ millions) | Dayrate | IWS | Reconciling items (1) | Consolidated total | ||||||||||
Revenue | ( | |||||||||||||
Related party revenue | ||||||||||||||
Intersegment revenue | ( | |||||||||||||
Gain on disposal | ||||||||||||||
Rig operating and maintenance expenses | ( | ( | ( | |||||||||||
Intersegment expenses | ( | |||||||||||||
Depreciation of non-current assets | ( | ( | ( | |||||||||||
Impairment of non-current assets | ( | ( | ||||||||||||
General and administrative expenses | ( | ( | ||||||||||||
Income from equity method investments | ||||||||||||||
Operating (loss)/income including equity method investment | ( | ( | ( |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
South East Asia | ||||||||||||||
Europe | ||||||||||||||
West Africa | ||||||||||||||
Mexico | ||||||||||||||
Middle East | ||||||||||||||
Total | ||||||||||||||
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In % of operating revenues) | ||||||||||||||
CNOOC Petroleum Europe Limited | % | % | % | % | ||||||||||
BW Energy Gabon S.A. | % | % | % | % | ||||||||||
PTT Exploration and Production Public Company Limited | % | % | % | % | ||||||||||
JX Nippon Oil & Gas Exploration (Malaysia) Limited | % | % | % | % | ||||||||||
Vestigo Petroleum Sdn. Bhd. | % | % | % | % | ||||||||||
Pemex | % | % | % | % | ||||||||||
ExxonMobil | % | % | % | % | ||||||||||
National Drilling Company (ADOC) | % | % | % | % | ||||||||||
Spirit Energy Production UK Limited | % | % | % | % | ||||||||||
ENI | % | % | % | % | ||||||||||
Total | % | % | % | % |
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
Mexico | ||||||||
Middle East | ||||||||
West Africa | ||||||||
Europe | ||||||||
Total | ||||||||
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
Accrued revenue | ||||||||
Current contract assets | ||||||||
Current deferred mobilization and contract preparation revenue (1) | ( | ( | ||||||
Current contract liability | ( | ( | ||||||
Non-current deferred mobilization and contract preparation revenue (2) | ( | |||||||
Non-current contract liability | ( | |||||||
Total contract liability | ( | ( | ||||||
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Over time | ||||||||||||||
Point in time | ||||||||||||||
Total |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | |||||||||||||||||||||||||
In $ millions | Perfomex | Opex | Akal | Perfomex II | Perfomex | Opex | Akal | Perfomex II | ||||||||||||||||||
Revenue | ||||||||||||||||||||||||||
Operating expenses | ( | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||
Net (loss) / income | ( | ( | ||||||||||||||||||||||||
6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||||||||||||||||
In $ millions | Perfomex | Opex | Akal | Perfomex II | Perfomex | Opex | Akal | Perfomex II | ||||||||||||||||||
Revenue | ||||||||||||||||||||||||||
Operating expenses | ( | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||
Net (loss) / income | ( |
As at June 30, 2021 | As at December 31, 2020 | |||||||||||||||||||||||||
In $ millions | Perfomex | Opex | Akal | Perfomex II | Perfomex | Opex | Akal | Perfomex II | ||||||||||||||||||
Cash | ||||||||||||||||||||||||||
Total current assets | ||||||||||||||||||||||||||
Total non-current assets | ||||||||||||||||||||||||||
Total assets | ||||||||||||||||||||||||||
Total current liabilities | ||||||||||||||||||||||||||
Total non current liabilities | ||||||||||||||||||||||||||
Equity | ( | ( | ( | |||||||||||||||||||||||
Total Liabilities and Equity |
In $ millions | Perfomex | Opex | Akal | Perfomex II | Borr Total | ||||||||||||
Balance as at January 1, 2021 | |||||||||||||||||
Funding provided by / (received from) shareholder loan (1) | ( | ( | |||||||||||||||
Income / (loss) on a percentage basis | ( | ||||||||||||||||
Balance as at June 30, 2021 | ( | ||||||||||||||||
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Foreign exchange (loss)/gain, net | ( | ( | ( | |||||||||||
Other financial expenses (1) | ( | ( | ( | ( | ||||||||||
Change in fair value on call spread (2) | ( | |||||||||||||
Realized gain on marketable securities (3) | ||||||||||||||
Gain / (loss) on forward contracts (3) | ( | |||||||||||||
Total | ( | ( | ( | ( |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Current tax | ( | ( | ( | |||||||||||
Change in deferred tax | ( | |||||||||||||
Total | ( | ( | ( | |||||||||||
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
Basic loss per share | ( | ( | ( | ( | ||||||||||
Diluted loss per share | ( | ( | ( | ( | ||||||||||
Issued ordinary shares at the end of the period | ||||||||||||||
Weighted average numbers of shares outstanding for the period |
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
Expected credit loss provision |
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
VAT and other tax receivable (1) | ||||||||
Other receivables | ||||||||
Client rechargeables | ||||||||
Deferred financing fee | ||||||||
Right-of-use lease asset, current (2) | ||||||||
Total | ||||||||
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
Opening balance | ||||||||
Additions | ||||||||
Transfers from Newbuildings | ||||||||
Depreciation and amortization | ( | ( | ||||||
Disposals | ( | |||||||
Reclassification to asset held for sale | ( | |||||||
Impairment | ( | |||||||
Total |
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
Deferred mobilization and contract preparation costs (1) | ||||||||
Deferred tax asset | ||||||||
Tax refunds | ||||||||
Total | ||||||||
June 30, 2021 | December 31, 2020 | |||||||
(In $ millions) | ||||||||
VAT and current taxes payable (1) | ||||||||
Other current liabilities | ||||||||
Deferred mobilization and contract preparation revenue | ||||||||
Accrued payroll and severance | ||||||||
Total | ||||||||
(In $ millions) | Principal Amount | |||||||
June 30, 2021 | December 31, 2020 | |||||||
Hayfin Term Loan Facility | ||||||||
Syndicated Senior Secured Credit Facilities | ||||||||
New Bridge Revolving Credit Facility | ||||||||
$ | ||||||||
PPL Delivery Financing | ||||||||
Keppel Delivery Financing | ||||||||
Total | ||||||||
Back end fee due to PPL and Keppel on Delivery of vessels | ||||||||
Effective interest rate adjustments on PPL and Keppel Delivery financing | ||||||||
Deferred finance charges | ( | ( | ||||||
Carrying Value | ||||||||
Maturities | |||||
(In $ millions) | |||||
2021 | |||||
2022 | |||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total principal debt | |||||
Hayfin Term Loan Facility | Syndicated Senior Secured Credit Facilities | New Bridge Revolving Credit Facility | |||||||||
Maturity dates | Extended to January 2023 | Extended to January 2023 | Extended to January 2023 | ||||||||
Amortizations | Not applicable | Extended to January 2023 | Extended to January 2023 | ||||||||
Interest payments | Not amended | Q3 2020 and Q4 2020 interest payments deferred by one year to 2021 | Q3 2020 and Q4 2020 interest payments deferred by one year to 2021 | ||||||||
Extension fees | |||||||||||
Covenant terms: | |||||||||||
Minimum liquidity requirements | Not amended | Cash requirement: $ | Cash requirement: $ | ||||||||
Restricted cash requirements | No requirement through to September 2021. From October 1, 2021 - three months interest payments for rigs which are not operating on a contract | Not applicable | Not applicable | ||||||||
Debt service cover ratio | Not applicable | Waived until final maturity | Waived until final maturity | ||||||||
Book to equity ratio 2021 | Not applicable | ||||||||||
Book to equity ratio 2022 | Not applicable | ||||||||||
Book to equity ratio 2023 | Not applicable | ||||||||||
Value to loan ratio (1) |
PPL Newbuild Financing | Keppel H-Rigs Financing | |||||||
Interim payments required 2021 | $ | $ | ||||||
Interim payments required 2022 | $ | $ | ||||||
Maturity | Date for repayment of the seller's credit on the rigs are amended to May 2023 | The loans for the | ||||||
Interest payments | No cash interest payments until March 2023 | First interest payment date deferred from third anniversary to May 2023 and second interest payment date deferred to the fourth anniversary of each loan (delivered rigs) | ||||||
Covenant terms: | ||||||||
Minimum liquidity requirements | Cash requirement: $ | Not applicable | ||||||
Value to loan | Requirement to provide additional security if the value of any rigs fall below $ | Not amended |
June 30, 2021 | December 31, 2020 | |||||||
(in $ millions) | ||||||||
Delivery installments for jack-up drilling rigs | ||||||||
Back-end fees | ||||||||
Total |
(In $ millions) | Less than 1 year | 2 years | 3 years | Thereafter | Total | ||||||||||||
Delivery installments for jack-up rigs |
June 30, 2021 | December 31, 2020 | |||||||
(in $ millions) | ||||||||
Surety bonds, bank guarantees and performance bonds (1) | ||||||||
Performance guarantee to Opex (2) | ||||||||
Total |
(In $ millions) | Less than 1 year | 1–3 years | 3–5 years | Thereafter | Total | ||||||||||||
Surety bonds and other guarantees | |||||||||||||||||
Performance guarantee to Opex | |||||||||||||||||
Total |
June 30, 2021 | December 31, 2020 | |||||||
(in $ millions) | ||||||||
Book value of jackup rigs pledged as collateral for long-term debt facilities |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Management Services Revenue - Perfomex | ||||||||||||||
Management Services Revenue - Perfomex II | ||||||||||||||
Management Services Revenue - Opex | ||||||||||||||
Bareboat Revenue - Perfomex | ( | |||||||||||||
Bareboat Revenue - Perfomex II | ||||||||||||||
Total |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Perfomex | ( | |||||||||||||
Perfomex II | ||||||||||||||
Opex | ||||||||||||||
Akal | ||||||||||||||
Total | ( |
June 30, 2021 | December 31, 2020 | |||||||
(in $ millions) | ||||||||
Perfomex | ||||||||
Perfomex II | ||||||||
Opex | ||||||||
Total |
3 months ended June 30, 2021 | 3 months ended June 30, 2020 | 6 months ended June 30, 2021 | 6 months ended June 30, 2020 | |||||||||||
(In $ millions) | ||||||||||||||
Magni Partners Limited (1) | ( | ( | ( | |||||||||||
Golar LNG Limited (2) | ( | ( | ||||||||||||
Schlumberger Limited (3) | ( | ( | ||||||||||||
Total | ( | ( | ( | ( |
June 30, 2021 | December 31, 2021 | |||||||
(In $ millions) | ||||||||
Golar LNG (2) | ( |
(In $ millions) | As at June 30, 2021 | As at December 31, 2020 | |||||||||||||||
Hierarchy | Fair value | Carrying value | Fair value | Carrying value | |||||||||||||
Assets | |||||||||||||||||
Cash and cash equivalents (1) | 1 | ||||||||||||||||
Trade receivables (1) | 1 | ||||||||||||||||
Tax retentions receivable (1) | 1 | ||||||||||||||||
Other current assets (excluding deferred costs) (1) | 1 | ||||||||||||||||
Due from related parties (1) | 1 | ||||||||||||||||
Liabilities | |||||||||||||||||
Trade payables (1) | 1 | ||||||||||||||||
Accruals and other current liabilities (1) | 1 | ||||||||||||||||
Long-term debt (2) | 2 | ||||||||||||||||
Guarantees issued to equity method investments (3) | 3 |
June 30, 2021 | December 31, 2020 | |||||||
(number of shares of $ | ||||||||
Authorized shares |
June 30, 2021 | December 31, 2020 | |||||||
(number of shares of $ | ||||||||
Issued | ||||||||
Treasury shares | ||||||||
Outstanding |
Cover |
6 Months Ended |
---|---|
Jun. 30, 2021 | |
Cover [Abstract] | |
Document Type | 6-K |
Entity File Number | 001-39007 |
Entity Registrant Name | Borr Drilling Limited |
Entity Central Index Key | 0001715497 |
Amendment Flag | false |
Document Fiscal Year Focus | 2021 |
Document Period End Date | Jun. 30, 2021 |
Document Fiscal Period Focus | Q2 |
Current Fiscal Year End Date | --12-31 |
Unaudited Consolidated Balance Sheets (Parenthetical) - $ / shares |
Jun. 30, 2021 |
Jun. 24, 2021 |
Jan. 26, 2021 |
Jan. 11, 2021 |
Dec. 31, 2020 |
Jun. 30, 2020 |
---|---|---|---|---|---|---|
Shareholders’ Equity | ||||||
Ordinary shares, par value (in dollars per share) | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | |
Authorized shares (in shares) | 360,000,000 | 238,653,846 | ||||
Common stock, shares issued (in shares) | 274,436,351 | 220,318,704 | 158,431,911 | |||
Common stock, shares outstanding (in shares) | 273,526,900 | 218,858,990 |
Unaudited Consolidated Statements of Changes in Shareholders’ Equity - USD ($) $ in Millions |
Total |
Previously reported |
Revision of prior period, accounting standards update, adjustment |
Common shares |
Common shares
Previously reported
|
Treasury shares |
Treasury shares
Previously reported
|
Additional paid in capital |
Additional paid in capital
Previously reported
|
Accumulated Deficit |
Accumulated Deficit
Previously reported
|
Accumulated Deficit
Revision of prior period, accounting standards update, adjustment
|
Non-controlling interest |
Non-controlling interest
Previously reported
|
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2019 | 110,818,351 | 110,818,351 | ||||||||||||
Beginning balance at Dec. 31, 2019 | $ 1,291.2 | $ 1,294.1 | $ (2.9) | $ 5.6 | $ 5.6 | $ (26.2) | $ (26.2) | $ 1,891.2 | $ 1,891.2 | $ (579.6) | $ (576.7) | $ (2.9) | $ 0.2 | $ 0.2 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Share-based compensation | 0.6 | 0.6 | ||||||||||||
Total comprehensive loss | (87.0) | (87.0) | ||||||||||||
Other, net | 1.5 | 1.5 | ||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 110,818,351 | |||||||||||||
Ending balance at Mar. 31, 2020 | 1,206.3 | $ 5.6 | (26.2) | 1,891.8 | (665.1) | 0.2 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Issue of common shares (in shares) | 46,153,846 | |||||||||||||
Issue of common shares | 30.0 | $ 2.3 | 27.7 | |||||||||||
Equity issuance costs | (1.2) | (1.2) | ||||||||||||
Share-based compensation | 0.2 | 0.2 | ||||||||||||
Total comprehensive loss | (109.6) | (109.6) | ||||||||||||
Other, net | (1.1) | (1.1) | ||||||||||||
Ending balance (in shares) at Jun. 30, 2020 | 156,972,197 | |||||||||||||
Ending balance at Jun. 30, 2020 | 1,124.6 | $ 7.9 | (26.2) | 1,918.5 | (775.8) | 0.2 | ||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 218,858,990 | |||||||||||||
Beginning balance at Dec. 31, 2020 | 1,036.8 | $ 11.0 | (26.2) | 1,947.2 | (895.2) | 0.0 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Issue of common shares (in shares) | 54,117,647 | |||||||||||||
Issue of common shares | 46.0 | $ 2.8 | 43.2 | |||||||||||
Equity issuance costs | (1.2) | (1.2) | ||||||||||||
Share based compensation (in shares) | 550,263 | |||||||||||||
Share-based compensation | 0.7 | 10.4 | (9.7) | |||||||||||
Total comprehensive loss | (54.4) | (54.4) | ||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 273,526,900 | |||||||||||||
Ending balance at Mar. 31, 2021 | 1,027.9 | $ 13.8 | (15.8) | 1,979.5 | (949.6) | 0.0 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Share-based compensation | 0.2 | 0.2 | ||||||||||||
Total comprehensive loss | (59.9) | (59.9) | ||||||||||||
Ending balance (in shares) at Jun. 30, 2021 | 273,526,900 | |||||||||||||
Ending balance at Jun. 30, 2021 | $ 968.2 | $ 13.8 | $ (15.8) | $ 1,979.7 | $ (1,009.5) | $ 0.0 |
General Information |
6 Months Ended |
---|---|
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General Information | General Information Borr Drilling Limited was incorporated in Bermuda on August 8, 2016. We are listed on the Oslo Stock Exchange and on the New York Stock Exchange under the ticker BORR. Borr Drilling Limited is an international offshore drilling contractor providing services to the oil and gas industry. As of June 30, 2021, we had 23 jack-up rigs, including 10 "warm stacked" rigs and had agreed to purchase five additional premium jack-up rigs under construction. Of our total fleet of 28 jack-up drilling rigs (including newbuilds under contract), five jack-up drilling rigs are scheduled for delivery in 2023. As used herein, and unless otherwise required by the context, the term “Borr Drilling” refers to Borr Drilling Limited and the terms “Company,” “Borr”, “we,” “Group,” “our” and words of similar nature refer to Borr Drilling and its consolidated companies. The use herein of such terms as “group”, “organization”, “we”, “us”, “our” and “its”, or references to specific entities, is not intended to be a precise description of corporate relationships. Going concern The unaudited consolidated financial statements have been prepared on a going concern basis. We continue to experience the impact of current unprecedented market conditions as a result of the global market reaction to the ongoing COVID-19 pandemic, together with uncertainty around the extent and timing for a full economic recovery. Despite these challenges, we believe that the oil and gas demand will rebalance and oil and gas will remain a significant portion of the world's energy mix. While we are seeing signs of market recovery, at this stage we cannot predict with reasonable accuracy the impact of these market conditions on the Company, specifically with the rise of the COVID-19 Delta variant. In January 2021, we amended certain of our shipyard financing agreements, whereby we agreed to pay $12.0 million in 2021 and $24.0 million in 2022, to our shipyards, in order to defer debt amortization, interest payments and maturity payments (including deposits for five newbuild rigs) into 2023. As a condition of these agreements, we raised a gross amount of $46 million in new equity in January 2021. The shipyard agreements, and new equity, satisfied the conditions precedent to execute certain amendments to our Syndicated Senior Secured Credit Facility, Hayfin Term Loan Facility and New Bridge Revolving Credit Facility, which extended their respective maturities to January 2023 and provided various other amendments. In addition, in July 2021, we established an at-the-market ("ATM") program under which we may offer and sell from time to time up to $40.0 million of our common shares to be listed on the New York Stock Exchange. While the Company has not determined whether it will sell any shares under the ATM program, the facility has been set up to provide flexibility going forward in anticipation of an improved market. While our recent amendments to our credit facilities and newbuild deliveries in January 2021, concurrent equity raise, the establishment of the ATM program and recent cash receipts from the sale of our equity interest in the Mexico IWS JV's, have stabilized our liquidity situation in a base case scenario through 2022, we have limited ability to respond to negative incidents or multiple downside scenarios, without additional financing or by raising further capital. Therefore, we have concluded that there exists substantial doubt over our ability to continue as a going concern. We will continue to explore additional financing opportunities and strategic sale of a limited number of modern jack-ups in order to further strengthen the liquidity of the Company. While we have confidence that these actions will enable us to better manage our liquidity position, and we have a track record of delivering additional financing and selling rigs, there is no guarantee that any additional financing or sale measures will be concluded successfully.
|
Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Accounting Policies | Accounting Policies Basis of accounting The unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The unaudited consolidated financial statements do not include all of the disclosures required under U.S. GAAP in the annual consolidated financial statements, and should be read in conjunction with our audited annual financial statements for the year ended December 31, 2020, which are included in our annual report on Form 20-F for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on April 30, 2021. The consolidated balance sheet data for December 31, 2020 was derived from our audited annual financial statements. The amounts are presented in millions of United States dollar ("U.S. dollar" or "$"), unless otherwise stated. The financial statements have been prepared on a going concern basis and in management's opinion, all adjustments necessary for a fair statement are reflected in the interim periods presented. Significant accounting policies The accounting policies adopted in the preparation of the unaudited consolidated financial statements for the three and six months ended June 30, 2021 are consistent with those followed in preparation of our annual audited consolidated financial statements for the year ended December 31, 2020. Use of estimates Preparation of financial statements in accordance with U.S. GAAP requires that management make estimates and assumptions affecting the reported amounts of assets and liabilities and disclosure of material contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
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Recently Issued Accounting Standards |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Changes and Error Corrections [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recently Issued Accounting Standards | Recently Issued Accounting Standards Adoption of new accounting standards In August 2018, the FASB issued ASU 2018-14 Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20). The amendments in this ASU remove certain disclosure requirements and introduce new ones including an explanation of the reasons for significant gains and losses relating to changes in the projected benefit obligation, plan assets to be returned to the entity and accumulated benefit obligation in excess of the fair value of related funding assets. These amendments to disclosures’ requirements are mandated for defined benefit plans from January 1, 2021. There was no impact resulting from these amendments on our unaudited consolidated financial statements or related disclosures as presented in this interim set of accounts for the six month ended June 30, 2021. In December 2019, the FASB issued ASU 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments remove certain exceptions previously available and provides additional calculation rules to help simplify the accounting for income taxes. These amendments are effective from January 1, 2021. There was no impact resulting from these amendments on our unaudited consolidated financial statements or related disclosures as presented in this interim set of accounts for the six months ended June 30, 2021. Accounting pronouncements that have been issued but not yet adopted
As of August 30, 2021 the FASB have issued further updates not included above. We do not currently expect any of these updates to have a material impact on our Consolidated Financial Statements and related disclosures either on transition or in future periods.
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment InformationWe have two operating segments: operations performed under our dayrate model (which includes rig charters and ancillary services) and operations performed under the Integrated Well Services ("IWS") model. IWS operations are performed by our joint venture entities Opex and Akal (see note 6). Our Chief Operating Decision Maker (our Board of Directors) reviews financial information provided as an aggregate sum of assets, liabilities and activities that exist to generate cash flow, by our two operating segments. The following presents financial information by segment for the 3 months ended June 30, 2021:
The following presents financial information by segment for the 3 months ended June 30, 2020:
The following presents financial information by segment for the 6 months ended June 30, 2021:
The following presents financial information by segment for the 6 months ended June 30, 2020:
(1) General and administrative expenses and depreciation expense incurred by our corporate office are not allocated to our operating segments for purposes of measuring segment operating income / (loss) and are included in "Reconciling items." The full operating results included above for our equity method investments are not included within our consolidated results and thus are deducted under "Reconciling items" and replaced with our Income / (loss) from equity method investments (see note 6 for additional information). Geographic data Revenues are attributed to geographical location based on the country of operations for drilling activities, and thus the country where the revenues are generated. The following presents our revenues by geographic area:
Major customers The following customers accounted for more than 10% of our dayrate revenues:
Fixed Assets — Jack-up rigs (1) The following presents the net book value of our jack-up rigs by geographic area:
(1) The fixed assets referred to in the table above exclude assets under construction. Asset locations at the end of a period are not necessarily indicative of the geographical distribution of the revenues or operating profits generated by such assets during the associated periods.
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Contracts with Customers |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contracts with Customers | Contracts with Customers Contract Assets and Liabilities Accrued revenue is classified as a current asset. When the right to consideration becomes unconditional based on the contractual billing schedule, accounts receivable are recognized. Payment terms on invoice amounts are typically 30 days. Deferred mobilization and contract preparation revenue include payments received for mobilization as well as rig preparation and upgrade activities, which are allocated to the overall performance obligation and recognized ratably over the initial term of the contract. The following presents our contract assets and liabilities from our contracts with customers:
(1) Current deferred mobilization and contract preparation revenue is included in "Other current liabilities" in our Unaudited Consolidated Balance Sheets. (2) Non-current deferred mobilization and contract preparation revenue is included in "Other liabilities" in our Unaudited Consolidated Balance Sheets. Accrued revenue decreased by $3.2 million to $17.1 million for the six months ended June 30, 2021 from $20.3 million as at December 31, 2020 as a result of $85.8 million in accrued revenue for the period, offset by $89.0 million of accrued revenue which was billed to customers. Deferred mobilization and contract preparation revenue increased by $3.1 million to $5.7 million for the six months ended June 30, 2021 from $2.6 million as at December 31, 2020 as a result of $5.7 million of cash received and invoices issued for mobilization and contract preparation, offset by $2.6 million in amortization. Timing of Revenue The Company derives its revenue from contracts with customers for the transfer of goods and services, from various activities performed both at a point in time and over time.
Contracts Costs Deferred mobilization and contract preparation costs relate to costs incurred to prepare a rig for contract and delivery or to mobilize a rig to the drilling location. We defer pre‑operating costs, such as contract preparation and mobilization costs, and recognize such costs on a straight‑line basis, consistent with the general pace of activity, in rig operating and maintenance costs over the estimated firm period of the drilling contract. Costs incurred for the demobilization of rigs at contract completion are recognized as incurred during the demobilization process. Deferred mobilization and contract preparation costs decreased by $1.8 million to $3.9 million for the six months ended June 30, 2021, from $5.7 million as of December 31, 2020 as a result of amortization during the period of $7.5 million, offset by $5.7 million in additional deferred costs relating to the contract preparations of the rigs "Norve", "Idun", "Natt" and "Skald". As at June 30, 2021, $2.4 million is current, and $1.5 million is non-current. Non-current deferred mobilization and contract preparation costs are disclosed in Other Non-Current Assets in the Unaudited Consolidated Balance Sheets. Practical Expedient We have applied the disclosure practical expedient in ASC 606-10-50-14A(b) and have not included estimated variable consideration related to wholly unsatisfied performance obligations or to distinct future time increments within our contracts, including dayrate revenue. The duration of our performance obligations varies by contract.
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Equity Method Investments |
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Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments | Equity Method Investments During 2019 we entered into a joint venture with Proyectos Globales de Energia y Servicos CME, S.A. DE C.V. (“CME”) to provide integrated well services to Petróleos Mexicanos (“Pemex”). This involved Borr Mexico Ventures Limited (“BMV”) subscribing to 49% of the equity of Opex Perforadora S.A. de C.V. (“Opex”) and Perforadora Profesional AKAL I, SA de CV (“Akal”). CME’s wholly owned subsidiary, Operadora Productora y Exploradora Mexicana, S.A. de C.V. (“Operadora”) owns 51% of each of Opex and Akal. We provide five jack-up rigs on bareboat charters to two other joint venture companies, Perfomex and Perfomex II, which are owned in the same proportion as Opex and Akal. Perfomex and Perfomex II provide the jack-up rigs under traditional dayrate drilling and technical service agreements to Opex and Akal. Opex and Akal also contract technical support services from BMV, management services from Operadora and well services from specialist well service contractors (including an affiliate of one of our shareholders Schlumberger Limited) and logistics and administration services from Logística y Operaciones OTM, S.A. de C.V, an affiliate of CME. This structure enables Opex and Akal to provide bundled integrated well services to Pemex. The potential revenue earned is fixed under each of the Pemex contracts, while Opex and Akal manage the drilling services and related costs on a per well basis. We are also obligated, as a 49% shareholder, to fund any capital shortfall in Opex or Akal should the Board of Opex or Akal make cash calls to the shareholders under the provisions of the Shareholder Agreements. The below tables sets forth the results from these entities, on a 100% basis, for the three months ended June 30, 2021 and 2020:
The below tables sets forth the results from these entities, on a 100% basis, for the six months ended June 30, 2021 and 2020:
Revenue in Opex and Akal is recognized on a percentage of completion basis under the cost input method. The services Opex and Akal deliver are to a single customer, Pemex, and involves delivering integrated well services with payment upon the completion of each well in the contract. Revenue in Perfomex and Perfomex II is recognized on a day rate basis on a contract with Opex and Akal, consistent with our historical revenue recognition policies, with day rate accruing each day as the service is performed. We provide rigs and services to Perfomex and Perfomex II for use in their contracts with Opex and Akal, respectively. As of June 30, 2021, the IWS JVs had $251.7 million in receivables from PEMEX, of which $40.5 million were outstanding and $211.2 million were unbilled. As of December 31, 2020, $97.6 million of receivables from PEMEX were outstanding, and $172.0 million were unbilled. As of June 30, 2021, Opex and Akal have recognized a combined $2.7 million provision related to the potential effect of factoring PEMEX receivables in Mexico. This compares to a provision of $6.3 million, recognized as of December 31, 2020. Summarized balance sheets, on a 100% basis of the Company's equity method investees are as follows:
We have issued a performance guarantee to Opex for the duration of its contract with Pemex. Management has performed a valuation exercise to fair value the guarantee given, utilizing the inferred debt market method and subsequently mapping to a credit score, adjusting for country risk and default probability. We have subsequently recognized a liability for $5.9 million in "Other liabilities" in the Unaudited Consolidated Balance Sheets and added the $5.9 million to the investment in the Opex joint venture. The following presents our investments in equity method investments as at June 30, 2021:
(1) As at June 30, 2021, the "Equity method investments" balance in the Unaudited Consolidated Balance Sheets includes $54.9 million in funding provided by shareholder loans comprised of balances with Perfomex of $39.0 million, Opex of $3.7 million, Akal of $1.7 million and Perfomex II of $10.5 million. On August 4, 2021, the Company executed a Stock Purchase Agreement between BMV and Operadora for the sale of the Company's 49% interest in each of Opex and Akal joint ventures, as well as the acquisition of a 2% incremental interest in each of Perfomex I and Perfomex II joint ventures (see note 20).
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Other Financial Income / (Expenses), net |
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Other Financial Income / (Expenses), net | Other Financial Income / (Expenses), net Other financial income/(expenses), net is comprised of the following:
(1) Other financial expenses includes amortization of deferred finance charges, cost cover and bank charges. (2) Change in the fair value of the call spread for the six months ended June, 2020 relates to the call spread on our convertible bond. The fair value is determined using the Black and Scholes model for option pricing. There was no change in the fair value of the call spread for the six months ended June 30, 2021.(3) Loss on forward contracts of $26.6 million for the six months ended June 30, 2020 relates to the forward contract to acquire 4.2 million shares in Valaris plc. During the second quarter of 2020 we settled in full our forward position and took delivery of 4.2 million shares in Valaris plc. The total realized loss on expiration of the contracts was $91.0 million. Total cash required to take delivery of the forwards was $92.5 million, of which $91.2 million was held as restricted cash at the time of settlement. Subsequently all shares were sold for total proceeds of $3 million, resulting in a gain of $1.5 million.
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Taxation |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Taxation | Taxation Borr Drilling Limited is a Bermuda company and is not required to pay taxes in Bermuda on ordinary income or capital gains under a tax exemption granted by the Minister of Finance in Bermuda until March 31, 2035. We operate through various subsidiaries in numerous countries throughout the world and are subject to tax laws, policies, treaties and regulations, as well as the interpretation or enforcement thereof, in jurisdictions in which we or any of our subsidiaries operate, were incorporated, or otherwise considered to have a tax presence. Our income tax expense is based upon our interpretation of the tax laws in effect in various countries at the time that the expense was incurred. For the three months ended June 30, 2021, our pre-tax loss is all attributable to foreign jurisdictions except for a $32.9 million pre-tax loss associated with Bermuda. For the three months ended June 30, 2020, our pre-tax loss is all attributable to foreign jurisdictions except for a $25.1 million pre-tax loss associated with Bermuda. For the six months ended June 30, 2021, our pre-tax loss is all attributable to foreign jurisdictions except for a $44.6 million pre-tax loss associated with Bermuda. For the six months ended June 30, 2020, our pre-tax loss is all attributable to foreign jurisdictions except for a $69.9 million pre-tax loss associated with Bermuda. The change in the effective tax rate from period to period is primarily attributable to changes in the profitability or loss mix of our operations in various jurisdictions. As our operations continually change among numerous jurisdictions and methods of taxation in these jurisdictions vary greatly, there is little direct correlation between the income tax provision or benefit and income or loss before taxes. We used a discrete effective tax rate method to calculate income taxes. Income tax credit / (expense) is comprised of the following:
The deferred tax assets related to our net operating losses were primarily generated in the United Kingdom and will not expire. We recognize a valuation allowance for deferred tax assets when it is more likely than not that the benefit from the deferred tax asset will not be realized. The amount of deferred tax assets considered realizable could increase or decrease in the near term if estimates of future taxable income change.
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Loss Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Per Share | Loss Per Share The computation of basic loss per share (“EPS”) is based on the weighted average number of shares outstanding during the period. Diluted EPS does not include the effect of the assumed conversion of potentially dilutive instruments which are 1,110,000 share options outstanding issued to employees and directors as at June 30, 2021, and convertible bonds with a conversion price of $31.7946 for a total of 11,008,159 shares. Due to our current loss-making position and the share price being less than the conversion price of the convertible bonds these are deemed to have an anti-dilutive effect on our EPS.
There are no share options that would be considered dilutive under the “if converted method” for the three and six months ended June 30, 2021 and 2020. Following our equity offering which closed on January 26, 2021 and in accordance with the loan agreement for the Company's $350 million 3.875% Senior Unsecured Convertible Bonds, an adjustment to the conversion price from $32.7743 to $31.7946 per depository receipt listed on Oslo Stock Exchange was triggered.
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Expected Credit Losses |
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Expected Credit Losses | Expected Credit Losses The table below sets forth the allowance for credit losses:
For the six months ended June 30, 2021 the Company recognized a $0.2 million provision for expected credit losses, offset by $0.6 million in recoveries collected from the prior period provision. New provisions and recoveries of previous provisions are recorded in rig operating and maintenance expenses in the Unaudited Consolidated Statement of Operations, as and when they occur.
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Other Current Assets | Other Current Assets Other current assets are comprised of the following:
(1) During the six months ended June 30, 2021, we recognized $2.8 million relating to withholding tax credits receivable in India. (2) The right-of-use lease asset pertains to our office lease.
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Jack-Up Rigs |
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Jack Up Rigs [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Jack-Up Rigs | Jack-Up Rigs
Depreciation of property, plant and equipment In addition to the depreciation in the above table, we recorded a depreciation charge of $0.4 million and $0.9 million for the three and six months ended June 30, 2021 ($0.4 million and $1.0 million for the three and six months ended June 30, 2020), related to property, plant and equipment. Held for sale The sale of the jack-up drilling rig "Balder" was completed in the three months ended March 31, 2021. Proceeds less selling costs were $4.4 million, of which $3 million was received in 2020. A loss on sale of $0.1 million was recorded on the sale of the rig in the six months ended June 30, 2021. In addition in the six months ended June 30, 2021 we also sold equipment which had been fully written-off for $0.8 million. All disposals are within our dayrate segment and part of our business strategy to dispose of older assets. Impairment During the six months ended June 30, 2021, we considered whether indicators of impairment existed that could indicate that the carrying amounts of our jack-up rigs may not be recoverable as of June 30, 2021. We concluded that an impairment trigger existed and performed a recoverability assessment, however no impairment loss was recognized as the projected undiscounted net cash flows were significantly higher than the carrying amounts of our jack-up rigs. We will continue to monitor developments in the markets in which we operate for indications that the carrying values of our long-lived assets are not recoverable.
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Other Non-Current Assets |
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Other Assets, Noncurrent Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Non-Current Assets | Other Non-Current Assets Other long-term assets are comprised of the following:
(1) Non-current deferred mobilization and contract preparation costs relates to the non-current portion of contract mobilization and preparation costs for the rig "Skald", which commenced a long-term contract during the period. (2) The right-of-use lease asset pertains to our office lease.
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Other Current Liabilities |
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Other Liabilities, Current [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Liabilities | Other Current Liabilities Other current liabilities are comprised of the following:
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Long-Term Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt Long-term debt is comprised of the following:
Carrying amount in the table above includes, where applicable, deferred financing fees and certain interest adjustments to allow for variations in interest payments to be straight lined. Deferred finance charges increased due to capitalization of extension fees associated with amendments made to the Hayfin Term Loan Facility, the Syndicated Senior Secured Credit Facilities and the New Bridge Revolving Credit Facility, in January 2021, offset by amortization recognized for the six months ended June 30, 2021. At June 30, 2021 the scheduled maturities of our debt were as follows:
Our loan financing arrangements include our Hayfin Term Loan Facility, Syndicated Senior Secured Credit Facilities, and New Bridge Revolving Facility agreements entered into in June 2019, which collectively provided $745 million in financing, which we used to finance existing loan facilities. We agreed amendments to our secured facilities with our secured lenders in June 2020 and further amendments in January 2021. The key amendments from January 2021 are as follows:
(1) ratio of market values of rig to the aggregate outstanding facility amount and any undrawn uncancelled part of the facility. In addition, our delivery financing agreements include our PPL Newbuild Financing which was entered into in June 2017 and provides delivery financing for a portion of the purchase price equal to $87.0 million for the nine rigs associated with the financing agreement as well as our Keppel H-Rigs Financing which was entered into in May 2018 and provides delivery financing for a portion of the purchase price equal to $90.9 million for each of the three delivered rigs and $77.7 million for each of the two undelivered rigs. We agreed to amendments to our delivery financing agreements in June 2020 and further amendments in January 2021. The key amendments from January 2021 are as follows:
Interest The weighted average interest rate for all our interest-bearing debt, excluding Convertible Bonds, was 4.7% for the Six months ended June 30, 2021. Covenants As at June 30, 2021, we were in compliance with the covenants and our obligations under our debt agreements.
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies The Company has the following delivery installment commitments as at June 30, 2021:
The back-end fee is only payable and will be included as part of the cost price if we choose to accept delivery financing from Keppel. In addition, under the PPL Financing, PPL is entitled to certain fees payable in connection with the increase in the market value of the relevant PPL Rig Owner from October 31, 2017 until the repayment date, less the relevant rig owner's equity cost of ownership of each rig and any interest paid on the delivery financing. The following table sets forth when our commitments fall due as of June 30, 2021:
In connection with the amendments to our credit arrangements in January 2021, the delivery dates for the five undelivered rigs from Keppel were postponed by one year, until 2023 (see note 15). The back-end fees are excluded from the maturity table above as they are only payable if we choose to accept the delivery financing from Keppel. Other commercial commitments We have other commercial commitments which contractually obligate us to settle with cash under certain circumstances. Surety bonds and parent company guarantees entered into between certain customers and governmental bodies guarantee our performance regarding certain drilling contracts, customs import duties and other obligations in various jurisdictions. The Company has the following guarantee commitments as at June 30, 2021:
(1) During the six months ended June 30, 2021, the rig "Frigg" was exported from Nigeria and subsequently the customs bond was cancelled, resulting in a $12.1 million decrease. (2) We have recognized a liability of $5.9 million for the performance guarantee provided to Opex (see note 6). As at June 30, 2021, the expected expiration dates of our obligations are as follows:
Assets pledged as collateral
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Related Party Transactions |
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Related Party Transactions [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions | Related Party Transactions a) Transactions with entities over which we have significant influence We provide three rigs on a bareboat basis to Perfomex to service its contract with Opex and two rigs on a bareboat basis to Perfomex II to service its contract with Akal, all of which were 49% owned joint venture companies as at June 30, 2021. Perfomex and Perfomex II provide the jack-up rigs under traditional dayrate and technical services agreements to Opex and Akal, respectively. This structure enables Opex and Akal to provide bundled integrated well services to Pemex. The potential revenue earned is fixed under each of the Pemex contracts, while Opex and Akal manage the drilling services related costs on a per well basis. The revenue from these contracts is recognized as "Related party revenue" in the Consolidated Statement of Operations. We are also obligated, as a 49% shareholder, to fund any capital shortfall in Opex or Akal should the Board of Opex or Akal make cash calls to the shareholders under the provisions of the Shareholders Agreement (see note 6). For the three and six months ended June 30, 2021 and 2020, the management services revenues and bareboat revenues from our related parties consisted of the following:
For the three and six months ended June 30, 2021 and 2020, funding provided to and (received from) our joint ventures consisted of the following:
As at June 30, 2021 and December 31, 2020, due from related parties balances with our joint ventures consisted of the following:
In addition, we have recognized $5.9 million in "Other liabilities" in the Unaudited Consolidated Balance Sheet as the fair value of the performance guarantee issued by the Company to Opex for the duration of its contract with Pemex (see note 6). b) Transactions with Other Relates Parties Revenue / (expenses): The transactions with other related parties for the three and six months ended June 30, 2021 and 2020 consisted of the following:
(1) Magni Partners Limited ("Magni") is party to a Corporate Services Agreement with the Company pursuant to which it provides strategic advice and assists in sourcing investment opportunities, financing and other such services as the Company wishes to engage, at the Company's option. There is both a fixed and variable element of the agreement, with the fixed cost element representing Magni's fixed costs and any variable element being at the Company's discretion. Mr. Tor Olav Trøim, the Deputy Chairman of our Board, is the sole owner of Magni. (2) Golar LNG Limited ("Golar LNG") is party to a Management Services and Administrative Agreement with the Company pursuant to which it provides services from Golar LNG's Bermuda Corporate Office. Mr. Tor Olav Trøim, the Deputy Chairman of our Board, is the Chairman of the Board of Golar LNG. (3) Schlumberger Limited ("Schlumberger") is one of our larger shareholders, holding 5.5% at June 30, 2021. Until his appointment as our Chief Executive Officer, Patrick Schorn, formerly Executive Vice President of Wells at Schlumberger Limited, was a Director on our Board. Following the resignation of Patrick Schorn from Schlumberger on August 31, 2020, Schlumberger ceased to be a related party. We have presented in the table above the expenses incurred for the three and six months ended June 30, 2020 as during this period Schlumberger was considered a related party. Payables: The balances with other related parties as of June 30, 2021 and December 31, 2020 consisted of the following:
Balances owing to or from related parties are unsecured, interest-free and intend to be settled in the ordinary course of business.
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Fair Value of Financial Instruments |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments We recognize our fair value estimates using a fair value hierarchy based on the inputs used to measure fair value. The fair value hierarchy has three levels based on reliability of inputs used to determine fair value as follows: Level 1: Quoted market prices in active markets for identical assets and liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data The carrying value and estimated fair value of our financial instruments at June 30, 2021 and December 31, 2020 were as follows:
(1) The carrying values approximate the fair values due to their short-term nature and near term expected receipt of cash. (2) Long-term debt includes our 3.875% convertible bond due in 2023 which is fair valued using observable market based inputs. (3) Guarantees issued to equity method investments has been valued utilizing the inferred debt market method and subsequently mapped to an alpha category credit score, adjusting for country risk and probability of default (see note 6). Assets Measured at Fair Value on a Non-Recurring Basis At December 31, 2020, the rig "Balder" was classified as held for sale and sold in February 2021. The Company measured the rig at fair value of $5.0 million on June 30, 2020, which was determined using level 3 inputs based on a combination of an income approach, using projected discounted cash flows an estimated sale or scrap value which require significant judgements.
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Common Shares |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Shares | Common Shares Authorized share capital
On January 11, 2021, our shareholders approved an increase in the Company's authorized share capital of 51,346,154 new common shares with a nominal value of $0.05 per common share. On June 24, 2021, our shareholders approved an increase in the Company's authorized share capital of 70,000,000 new common shares with a nominal value of $0.05 per common share. Issued and outstanding share capital
On January 22, 2021, we conducted a private placement for gross proceeds of $46 million by issuing 54,117,647 new depository receipts at a subscription price of $0.85 per depository receipt. On January 26, 2021, the January equity offering was settled and the Company's issued share capital was increased by $2.7 million to $13.7 million, divided into 274,436,351 common shares with a nominal value of $0.05 per common share. On March 18, 2021, the Company issued a total amount of 550,263 treasury shares to Directors relating to 2020 compensation. As at June 30, 2021, our shares were listed on the Oslo Stock Exchange and the New York Stock Exchange.
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Subsequent Events |
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Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In July 2021, the Company issued a total amount of 96,785 treasury shares to Directors relating to 2021 compensation. After issuance of these shares, the Company's issued share capital was 274,436,351 common shares, the Company owned 812,666 treasury shares and the Company's outstanding share capital was 273,623,685 shares of nominal value of $0.05 per common share. In July 2021, we established an ATM program under which we may offer and sell from time to time up to $40.0 million of our common shares to be listed on the New York Stock Exchange. The Company plans to use the proceeds from these sales, if any, for general corporate purposes, which may include, among other things, payments on our debt obligations, which may include in the future, payments to our creditors in return for potential concessions or extensions of current facilities, capital expenditures, including costs in connection with activations and re-activations of rigs being brought into operations, or funding of our working capital. On August 4, 2021, the Company executed a Stock Purchase Agreement for the sale of the Company's 49% stake in each of Opex and Akal joint ventures, as well as the acquisition of a 2% incremental stake in each Perfomex I and Perfomex II joint ventures. Cash consideration received for the sale of the Company's interest in Opex and Akal was $8.1 million and cash consideration paid for the incremental stake in both Perfomex I and Perfomex II was $0.1 million. In addition, the Company received an additional $18.6 million in relation to the settlement of outstanding receivables from Opex and Akal. The Company has executed revised Shareholders' Agreements for Perfomex and Perfomex II as well as revised Drilling and Technical Services Agreements and Technical Support Agreements. On August 12, 2021, the Board of Directors of the Company resolved to grant 10.3 million share options under the Company's approved share options scheme to 23 of its employees. Each share option gives the right to subscribe to one share in the Company. The options have a strike price of $1.00 and vest equally over a three-year period commencing two years from the date of grant and will expire after five years.
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Accounting Policies (Policies) |
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Going concern | Going concern The unaudited consolidated financial statements have been prepared on a going concern basis. We continue to experience the impact of current unprecedented market conditions as a result of the global market reaction to the ongoing COVID-19 pandemic, together with uncertainty around the extent and timing for a full economic recovery. Despite these challenges, we believe that the oil and gas demand will rebalance and oil and gas will remain a significant portion of the world's energy mix. While we are seeing signs of market recovery, at this stage we cannot predict with reasonable accuracy the impact of these market conditions on the Company, specifically with the rise of the COVID-19 Delta variant. In January 2021, we amended certain of our shipyard financing agreements, whereby we agreed to pay $12.0 million in 2021 and $24.0 million in 2022, to our shipyards, in order to defer debt amortization, interest payments and maturity payments (including deposits for five newbuild rigs) into 2023. As a condition of these agreements, we raised a gross amount of $46 million in new equity in January 2021. The shipyard agreements, and new equity, satisfied the conditions precedent to execute certain amendments to our Syndicated Senior Secured Credit Facility, Hayfin Term Loan Facility and New Bridge Revolving Credit Facility, which extended their respective maturities to January 2023 and provided various other amendments. In addition, in July 2021, we established an at-the-market ("ATM") program under which we may offer and sell from time to time up to $40.0 million of our common shares to be listed on the New York Stock Exchange. While the Company has not determined whether it will sell any shares under the ATM program, the facility has been set up to provide flexibility going forward in anticipation of an improved market. While our recent amendments to our credit facilities and newbuild deliveries in January 2021, concurrent equity raise, the establishment of the ATM program and recent cash receipts from the sale of our equity interest in the Mexico IWS JV's, have stabilized our liquidity situation in a base case scenario through 2022, we have limited ability to respond to negative incidents or multiple downside scenarios, without additional financing or by raising further capital. Therefore, we have concluded that there exists substantial doubt over our ability to continue as a going concern. We will continue to explore additional financing opportunities and strategic sale of a limited number of modern jack-ups in order to further strengthen the liquidity of the Company. While we have confidence that these actions will enable us to better manage our liquidity position, and we have a track record of delivering additional financing and selling rigs, there is no guarantee that any additional financing or sale measures will be concluded successfully.
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Basis of accounting | Basis of accounting The unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The unaudited consolidated financial statements do not include all of the disclosures required under U.S. GAAP in the annual consolidated financial statements, and should be read in conjunction with our audited annual financial statements for the year ended December 31, 2020, which are included in our annual report on Form 20-F for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on April 30, 2021. The consolidated balance sheet data for December 31, 2020 was derived from our audited annual financial statements. The amounts are presented in millions of United States dollar ("U.S. dollar" or "$"), unless otherwise stated. The financial statements have been prepared on a going concern basis and in management's opinion, all adjustments necessary for a fair statement are reflected in the interim periods presented.
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Use of estimates | Use of estimates Preparation of financial statements in accordance with U.S. GAAP requires that management make estimates and assumptions affecting the reported amounts of assets and liabilities and disclosure of material contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
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Adoption of new accounting standards and Accounting pronouncements that have been issued but not yet adopted | Adoption of new accounting standards In August 2018, the FASB issued ASU 2018-14 Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20). The amendments in this ASU remove certain disclosure requirements and introduce new ones including an explanation of the reasons for significant gains and losses relating to changes in the projected benefit obligation, plan assets to be returned to the entity and accumulated benefit obligation in excess of the fair value of related funding assets. These amendments to disclosures’ requirements are mandated for defined benefit plans from January 1, 2021. There was no impact resulting from these amendments on our unaudited consolidated financial statements or related disclosures as presented in this interim set of accounts for the six month ended June 30, 2021. In December 2019, the FASB issued ASU 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments remove certain exceptions previously available and provides additional calculation rules to help simplify the accounting for income taxes. These amendments are effective from January 1, 2021. There was no impact resulting from these amendments on our unaudited consolidated financial statements or related disclosures as presented in this interim set of accounts for the six months ended June 30, 2021. Accounting pronouncements that have been issued but not yet adopted
As of August 30, 2021 the FASB have issued further updates not included above. We do not currently expect any of these updates to have a material impact on our Consolidated Financial Statements and related disclosures either on transition or in future periods.
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Recently Issued Accounting Standards (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Changes and Error Corrections [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
New Accounting Pronouncement, Issued but Not Yet Adopted | Accounting pronouncements that have been issued but not yet adopted
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Segment Information (Tables) |
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following presents financial information by segment for the 3 months ended June 30, 2021:
The following presents financial information by segment for the 3 months ended June 30, 2020:
The following presents financial information by segment for the 6 months ended June 30, 2021:
The following presents financial information by segment for the 6 months ended June 30, 2020:
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Revenues by Geographic Area | The following presents our revenues by geographic area:
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Major Customers by Reporting Segments | The following customers accounted for more than 10% of our dayrate revenues:
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Long-lived Assets by Geographic Areas | The following presents the net book value of our jack-up rigs by geographic area:
(1) The fixed assets referred to in the table above exclude assets under construction. Asset locations at the end of a period are not necessarily indicative of the geographical distribution of the revenues or operating profits generated by such assets during the associated periods.
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Contracts with Customers (Tables) |
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in the remaining performance obligation contract asset balances | The following presents our contract assets and liabilities from our contracts with customers:
(1) Current deferred mobilization and contract preparation revenue is included in "Other current liabilities" in our Unaudited Consolidated Balance Sheets. (2) Non-current deferred mobilization and contract preparation revenue is included in "Other liabilities" in our Unaudited Consolidated Balance Sheets.
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Disaggregation of revenue |
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Equity Method Investments (Tables) |
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Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments | The below tables sets forth the results from these entities, on a 100% basis, for the three months ended June 30, 2021 and 2020:
The below tables sets forth the results from these entities, on a 100% basis, for the six months ended June 30, 2021 and 2020:
Summarized balance sheets, on a 100% basis of the Company's equity method investees are as follows:
The following presents our investments in equity method investments as at June 30, 2021:
(1) As at June 30, 2021, the "Equity method investments" balance in the Unaudited Consolidated Balance Sheets includes $54.9 million in funding provided by shareholder loans comprised of balances with Perfomex of $39.0 million, Opex of $3.7 million, Akal of $1.7 million and Perfomex II of $10.5 million.
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Other Financial Income / (Expenses), net (Tables) |
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expenses [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Nonoperating Income (Expense) | Other financial income/(expenses), net is comprised of the following:
(1) Other financial expenses includes amortization of deferred finance charges, cost cover and bank charges. (2) Change in the fair value of the call spread for the six months ended June, 2020 relates to the call spread on our convertible bond. The fair value is determined using the Black and Scholes model for option pricing. There was no change in the fair value of the call spread for the six months ended June 30, 2021.(3) Loss on forward contracts of $26.6 million for the six months ended June 30, 2020 relates to the forward contract to acquire 4.2 million shares in Valaris plc. During the second quarter of 2020 we settled in full our forward position and took delivery of 4.2 million shares in Valaris plc. The total realized loss on expiration of the contracts was $91.0 million. Total cash required to take delivery of the forwards was $92.5 million, of which $91.2 million was held as restricted cash at the time of settlement. Subsequently all shares were sold for total proceeds of $3 million, resulting in a gain of $1.5 million.
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Taxation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Expense | Income tax credit / (expense) is comprised of the following:
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Loss Per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of computation of basic EPS |
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Expected Credit Losses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||
Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||
Allowance for Expected Credit Losses | The table below sets forth the allowance for credit losses:
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Other Current Assets (Tables) |
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Current Assets | Other current assets are comprised of the following:
(1) During the six months ended June 30, 2021, we recognized $2.8 million relating to withholding tax credits receivable in India. (2) The right-of-use lease asset pertains to our office lease.
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Jack-Up Rigs (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Jack Up Rigs [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of jack-up rigs |
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Other Non-Current Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Assets, Noncurrent Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Non-Current Assets | Other long-term assets are comprised of the following:
(1) Non-current deferred mobilization and contract preparation costs relates to the non-current portion of contract mobilization and preparation costs for the rig "Skald", which commenced a long-term contract during the period. (2) The right-of-use lease asset pertains to our office lease.
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Other current liabilities (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities, Current [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Liabilities | Other current liabilities are comprised of the following:
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Long-Term Debt (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Long-term debt is comprised of the following:
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Schedule of Maturities of Long-term Debt | At June 30, 2021 the scheduled maturities of our debt were as follows:
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Schedule Of Debt Amendments | The key amendments from January 2021 are as follows:
(1) ratio of market values of rig to the aggregate outstanding facility amount and any undrawn uncancelled part of the facility. The key amendments from January 2021 are as follows:
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Commitments and Contingencies (Tables) |
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments | The Company has the following delivery installment commitments as at June 30, 2021:
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Maturity of Commitments | The following table sets forth when our commitments fall due as of June 30, 2021:
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Other Commercial Commitments | The Company has the following guarantee commitments as at June 30, 2021:
(1) During the six months ended June 30, 2021, the rig "Frigg" was exported from Nigeria and subsequently the customs bond was cancelled, resulting in a $12.1 million decrease. (2) We have recognized a liability of $5.9 million for the performance guarantee provided to Opex (see note 6). As at June 30, 2021, the expected expiration dates of our obligations are as follows:
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Assets Pledged as Collateral | Assets pledged as collateral
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Related Party Transactions (Tables) |
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Related Party Transactions [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions | For the three and six months ended June 30, 2021 and 2020, the management services revenues and bareboat revenues from our related parties consisted of the following:
For the three and six months ended June 30, 2021 and 2020, funding provided to and (received from) our joint ventures consisted of the following:
As at June 30, 2021 and December 31, 2020, due from related parties balances with our joint ventures consisted of the following:
Revenue / (expenses): The transactions with other related parties for the three and six months ended June 30, 2021 and 2020 consisted of the following:
(1) Magni Partners Limited ("Magni") is party to a Corporate Services Agreement with the Company pursuant to which it provides strategic advice and assists in sourcing investment opportunities, financing and other such services as the Company wishes to engage, at the Company's option. There is both a fixed and variable element of the agreement, with the fixed cost element representing Magni's fixed costs and any variable element being at the Company's discretion. Mr. Tor Olav Trøim, the Deputy Chairman of our Board, is the sole owner of Magni. (2) Golar LNG Limited ("Golar LNG") is party to a Management Services and Administrative Agreement with the Company pursuant to which it provides services from Golar LNG's Bermuda Corporate Office. Mr. Tor Olav Trøim, the Deputy Chairman of our Board, is the Chairman of the Board of Golar LNG. (3) Schlumberger Limited ("Schlumberger") is one of our larger shareholders, holding 5.5% at June 30, 2021. Until his appointment as our Chief Executive Officer, Patrick Schorn, formerly Executive Vice President of Wells at Schlumberger Limited, was a Director on our Board. Following the resignation of Patrick Schorn from Schlumberger on August 31, 2020, Schlumberger ceased to be a related party. We have presented in the table above the expenses incurred for the three and six months ended June 30, 2020 as during this period Schlumberger was considered a related party. Payables: The balances with other related parties as of June 30, 2021 and December 31, 2020 consisted of the following:
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Fair Value of Financial Instruments (Tables) |
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Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Value and Estimated Fair Value of Cash and Financial Instruments | The carrying value and estimated fair value of our financial instruments at June 30, 2021 and December 31, 2020 were as follows:
(1) The carrying values approximate the fair values due to their short-term nature and near term expected receipt of cash. (2) Long-term debt includes our 3.875% convertible bond due in 2023 which is fair valued using observable market based inputs. (3) Guarantees issued to equity method investments has been valued utilizing the inferred debt market method and subsequently mapped to an alpha category credit score, adjusting for country risk and probability of default (see note 6).
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Common Shares (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share Capital |
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Segment Information - Revenue By Geographic Areas (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
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Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 54.8 | $ 84.0 | $ 103.2 | $ 188.1 |
South East Asia | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 21.4 | 16.9 | 48.3 | 35.8 |
Europe | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 17.5 | 11.3 | 31.4 | 39.9 |
West Africa | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 12.5 | 33.2 | 19.7 | 68.8 |
Mexico | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 3.4 | 12.3 | 3.8 | 23.1 |
Middle East | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 0.0 | $ 10.3 | $ 0.0 | $ 20.5 |
Segment Information - Long-lived Assets By Geographic Areas (Details) - Operating segments - Dayrate - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
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Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 2,783.5 | $ 2,824.6 |
Mexico | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 1,263.8 | 1,277.4 |
Middle East | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 682.2 | 693.5 |
West Africa | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 576.8 | 587.3 |
Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 260.7 | $ 266.4 |
Contracts with Customers - Contract assets and liabilities (Details) - USD ($) $ in Millions |
6 Months Ended | |
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Jun. 30, 2021 |
Dec. 31, 2020 |
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Current contract assets | ||
Accrued revenue | $ 17.1 | $ 20.3 |
Current contract assets | 17.1 | 20.3 |
Current contract liability | ||
Current contract liability | (2.4) | (2.6) |
Non-current contract liability | ||
Non-current contract liability | (3.3) | 0.0 |
Total contract liability | (5.7) | $ (2.6) |
Decrease in accrued revenue | 3.2 | |
Accrued revenue in period | 85.8 | |
Accrued revenue billed in period | 89.0 | |
Increase in deferred mobilization and contract preparation revenue | 3.1 | |
Cash received, excluding amounts recognized as revenue | 5.7 | |
Amortization of revenue, contract liability | $ 2.6 |
Contracts with Customers - Timing of revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
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Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 54.8 | $ 84.0 | $ 103.2 | $ 188.1 |
Over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 52.3 | 75.1 | 97.0 | 176.3 |
Point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 2.5 | $ 8.9 | $ 6.2 | $ 11.8 |
Contract with Customers - Contract costs (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2021 |
Dec. 31, 2020 |
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Revenue from Contract with Customer [Abstract] | ||
Decrease in deferred mobilization and contract preparation costs | $ 1.8 | |
Deferred contract costs | 3.9 | $ 5.7 |
Capitalized contract cost, amortization | 7.5 | |
Additional cost capitalized | 5.7 | |
Deferred mobilization and contract preparation costs, current | 2.4 | 5.7 |
Deferred mobilization and contract preparation costs, non-current | $ 1.5 | $ 0.0 |
Equity Method Investments - Summarized Statement of Operations (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Equity Method Investment, Summarized Financial Information [Abstract] | ||||
Revenue | $ 54.8 | $ 84.0 | $ 103.2 | $ 188.1 |
Operating expenses | (81.6) | (188.0) | (170.5) | (319.2) |
Net loss | (59.9) | (109.6) | (114.3) | (196.6) |
Perfomex | ||||
Equity Method Investment, Summarized Financial Information [Abstract] | ||||
Revenue | 29.3 | 37.4 | 51.8 | 65.5 |
Operating expenses | (27.4) | (33.0) | (47.7) | (60.1) |
Net loss | 2.5 | 3.0 | 1.1 | 3.4 |
Opex | ||||
Equity Method Investment, Summarized Financial Information [Abstract] | ||||
Revenue | 58.5 | 60.2 | 173.2 | 100.8 |
Operating expenses | (63.3) | (45.8) | (148.0) | (87.7) |
Net loss | (1.5) | 15.3 | 28.4 | 12.1 |
Akal | ||||
Equity Method Investment, Summarized Financial Information [Abstract] | ||||
Revenue | 27.1 | 25.8 | 71.9 | 35.0 |
Operating expenses | (35.7) | (23.6) | (81.7) | (34.8) |
Net loss | (16.3) | 2.0 | (9.3) | 0.0 |
Perfomex II | ||||
Equity Method Investment, Summarized Financial Information [Abstract] | ||||
Revenue | 13.8 | 9.7 | 23.9 | 12.4 |
Operating expenses | (8.6) | (6.8) | (17.9) | (10.8) |
Net loss | $ 3.7 | $ 2.8 | $ 3.3 | $ 1.9 |
Other Financial Income / (Expenses), net -Schedule of Other Financial (Expenses) Income, Net (Details) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Debt Instrument [Line Items] | ||||
Foreign exchange (loss)/gain, net | $ (1.9) | $ (1.0) | $ (2.5) | $ 0.6 |
Other financial expenses | (3.4) | (6.4) | (8.5) | (8.7) |
Change in fair value on call spread | 0.0 | 0.0 | 0.0 | (2.3) |
Realized gain on marketable securities | 0.0 | 1.5 | 0.0 | 1.5 |
Gain / (loss) on forward contracts | 0.0 | 0.2 | 0.0 | (26.6) |
Other financial expenses, net | $ (5.3) | $ (5.7) | $ (11.0) | (35.5) |
Proceeds from sale of other investments | 3.0 | |||
Gain on sale of other investments | 1.5 | |||
Forward contracts | ||||
Debt Instrument [Line Items] | ||||
Gain / (loss) on forward contracts | $ (91.0) | |||
Settlement of forward contract, number of shares obtained (in shares) | 4.2 | 4.2 | ||
Payment for settlement of forward contract, cash component | $ 92.5 | |||
Payment for settlement of forward contract, restricted cash component | $ 91.2 |
Taxation - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Income Tax Examination [Line Items] | ||||
Loss before income taxes | $ 60.9 | $ 106.2 | $ 113.0 | $ 187.0 |
Bermuda | ||||
Income Tax Examination [Line Items] | ||||
Loss before income taxes | $ 32.9 | $ 25.1 | $ 44.6 | $ 69.9 |
Taxation - Components of Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
|
Income Tax Disclosure [Abstract] | ||||
Current tax | $ 0.5 | $ (3.9) | $ (2.1) | $ (9.1) |
Change in deferred tax | 0.5 | 0.5 | 0.8 | (0.5) |
Total | $ 1.0 | $ (3.4) | $ (1.3) | $ (9.6) |
Loss Per Share - Schedule of Loss per Share (Details) - $ / shares |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
Dec. 31, 2020 |
|
Earnings Per Share [Abstract] | |||||
Basic loss per share (in dollars per share) | $ (0.22) | $ (0.83) | $ (0.43) | $ (1.62) | |
Diluted loss per share (in dollars per share) | $ (0.22) | $ (0.83) | $ (0.43) | $ (1.62) | |
Issued ordinary shares at the end of the period (in shares) | 274,436,351 | 158,431,911 | 274,436,351 | 158,431,911 | 220,318,704 |
Weighted-average shares outstanding, basic (in shares) | 274,436,351 | 131,612,941 | 266,363,553 | 121,215,646 | |
Weighted-average shares outstanding, diluted (in shares) | 274,436,351 | 131,612,941 | 266,363,553 | 121,215,646 |
Expected Credit Losses (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2021 |
Dec. 31, 2020 |
|
Credit Loss [Abstract] | ||
Expected credit loss provision | $ 2.7 | $ 3.1 |
Current-period provision for expected credit losses | 0.2 | |
Recoveries collected | $ 0.6 |
Other Current Assets (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2021 |
Dec. 31, 2020 |
|
Other Current Assets [Abstract] | ||
VAT and other tax receivable | $ 9.1 | $ 3.7 |
Other receivables | 3.1 | 6.7 |
Client rechargeables | 2.4 | 4.2 |
Deferred financing fee | 1.3 | 1.5 |
Right-of-use lease asset, current | 0.3 | 0.3 |
Total | 16.2 | $ 16.4 |
Withholding tax credits recognised | $ 2.8 |
Jack-Up Rigs - Schedule of jack-up rigs (Details) - USD ($) $ in Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2021 |
Dec. 31, 2020 |
|
Jack Up Rigs [Roll Forward] | ||
Opening balance | $ 2,824.6 | $ 2,683.3 |
Additions | 12.8 | 37.4 |
Transfers from Newbuildings | 0.0 | 312.7 |
Depreciation and amortization | (53.9) | (116.0) |
Disposals | 0.0 | (6.5) |
Reclassification to asset held for sale | 0.0 | (9.2) |
Impairment | 0.0 | (77.1) |
Total | $ 2,783.5 | $ 2,824.6 |
Jack-Up Rigs - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jun. 30, 2021 |
Mar. 31, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
Dec. 31, 2020 |
|
Property, Plant and Equipment [Line Items] | ||||||
Depreciation related to property, plant and equipment | $ 0.4 | $ 0.4 | $ 0.9 | $ 1.0 | ||
Net proceeds | 0.8 | |||||
Loss on disposition of assets | $ (0.8) | $ (12.8) | (0.7) | $ (13.1) | ||
Balder | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Net proceeds | $ 4.4 | $ 3.0 | ||||
Loss on disposition of assets | $ 0.1 |
Other Non-Current Assets (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Other Assets, Noncurrent Disclosure [Abstract] | ||
Deferred mobilization and contract preparation cost | $ 1.5 | $ 0.0 |
Right-of-use asset, non-current [extensible list] | Total | Total |
Right-of-use lease asset, non-current | $ 1.3 | $ 1.3 |
Deferred tax asset | 1.0 | 0.2 |
Tax refunds | 0.5 | 0.4 |
Total | $ 4.3 | $ 1.9 |
Other current liabilities (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Other Liabilities, Current [Abstract] | ||
VAT and current taxes payable | $ 14.2 | $ 9.9 |
Other current liabilities | 2.6 | 6.2 |
Deferred mobilization and contract preparation revenue | $ 2.4 | $ 2.6 |
Operating lease liability, current [extensible list] | Total | Total |
Operating lease liability, current | $ 2.6 | $ 3.1 |
Accrued payroll and severance | 1.9 | 2.1 |
Total | $ 23.7 | $ 23.9 |
Long-Term Debt - Schedule of maturities (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Debt Disclosure [Abstract] | ||
2021 | $ 0.0 | |
2022 | 0.0 | |
2023 | 1,603.3 | |
2024 | 0.0 | |
2025 | 86.4 | |
2026 | 172.8 | |
Thereafter | 0.0 | |
Total principal debt | $ 1,862.5 | $ 1,857.5 |
Long-Term Debt - Amendments Delivery Financing Agreements (Details) $ in Millions |
1 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Jan. 31, 2021
rig
|
Jan. 01, 2023
USD ($)
|
Dec. 31, 2022
USD ($)
|
Jul. 01, 2022
USD ($)
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
Jan. 30, 2021
USD ($)
|
|
PPL Newbuild Financing | |||||||
Debt Instrument [Line Items] | |||||||
Interim payments required 2021 | $ 6 | ||||||
Interim payments required 2022 | 12 | ||||||
PPL Newbuild Financing | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Minimum liquidity requirements, cash requirement | $ 15 | $ 10 | $ 5 | ||||
Debt covenant, minimum value of rig | $ 75 | $ 70 | |||||
PPL Newbuild Financing | Subsequent event | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Debt covenant, minimum value of rig | $ 80 | ||||||
Keppel H-Rigs Financing | |||||||
Debt Instrument [Line Items] | |||||||
Interim payments required 2021 | 6 | ||||||
Interim payments required 2022 | $ 12 | ||||||
Keppel Delivery Financing | |||||||
Debt Instrument [Line Items] | |||||||
Number of rigs delivered | rig | 3 | ||||||
Loan maturity date, period extended | 1 year |
Commitments and Contingencies - Schedule of Commitments (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Delivery installments for jack-up drilling rigs | $ 621.0 | $ 621.0 |
Back-end fees | 9.0 | 9.0 |
Total | $ 630.0 | $ 630.0 |
Commitments and Contingencies - Maturity of Commitments (Details) $ in Millions |
Jan. 30, 2021
rig
|
Jun. 30, 2021
USD ($)
|
---|---|---|
Other Commitments [Line Items] | ||
Less than 1 year | $ 0.0 | |
2 years | 153.4 | |
3 years | 467.6 | |
Thereafter | 0.0 | |
Total | $ 621.0 | |
Keppel Delivery Financing | ||
Other Commitments [Line Items] | ||
Number of rig deliveries deferred | rig | 5 | |
Rigs delivery period extension | 1 year |
Commitments and Contingencies - Guarantee Commitments (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2021 |
Dec. 31, 2020 |
|
Other Commitments [Line Items] | ||
Total | $ 35.4 | $ 49.2 |
Surety bonds, bank guarantees, and performance bonds | ||
Other Commitments [Line Items] | ||
Total | 29.5 | 43.3 |
Decrease in other commitments | 12.1 | |
Performance guarantee to Opex | ||
Other Commitments [Line Items] | ||
Total | $ 5.9 | $ 5.9 |
Commitments and Contingencies - Other Commercial Commitments Maturity (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Other Commitments [Line Items] | ||
Less than 1 year | $ 27.0 | |
1–3 years | 5.9 | |
3–5 years | 2.5 | |
Thereafter | 0.0 | |
Total | 35.4 | $ 49.2 |
Surety bonds and other guarantees | ||
Other Commitments [Line Items] | ||
Less than 1 year | 27.0 | |
1–3 years | 0.0 | |
3–5 years | 2.5 | |
Thereafter | 0.0 | |
Total | 29.5 | 43.3 |
Performance guarantee to Opex | ||
Other Commitments [Line Items] | ||
Less than 1 year | 0.0 | |
1–3 years | 5.9 | |
3–5 years | 0.0 | |
Thereafter | 0.0 | |
Total | $ 5.9 | $ 5.9 |
Commitments and Contingencies - Assets Pledged as Collateral (Details) - USD ($) $ in Millions |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Book value of jackup rigs pledged as collateral for long-term debt facilities | $ 2,783.5 | $ 2,822.3 |
Related Party Transactions - Narrative (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2021
USD ($)
rig
| |
Borr Drilling Limited | Schlumberger Limited | Affiliated entity | |
Related Party Transaction [Line Items] | |
Ownership percentage | 5.50% |
Perfomex | |
Related Party Transaction [Line Items] | |
Ownership percentage | 49.00% |
Perfomex II | |
Related Party Transaction [Line Items] | |
Ownership percentage | 49.00% |
Opex | |
Related Party Transaction [Line Items] | |
Ownership percentage | 49.00% |
Guarantees issued to equity method investments | $ | $ 5.9 |
Akal | |
Related Party Transaction [Line Items] | |
Ownership percentage | 49.00% |
Perfomex | |
Related Party Transaction [Line Items] | |
Number of rigs | 3 |
Perfomex II | |
Related Party Transaction [Line Items] | |
Number of rigs | 2 |
Related Party Transactions - Transactions with Other Related Parties (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 30, 2020 |
Dec. 31, 2020 |
|
Related Party Transaction [Line Items] | |||||
Operating expenses | $ (81.6) | $ (188.0) | $ (170.5) | $ (319.2) | |
Affiliated entity | |||||
Related Party Transaction [Line Items] | |||||
Operating expenses | (0.1) | (2.9) | (0.6) | (4.8) | |
Affiliated entity | Magni Partners Limited | |||||
Related Party Transaction [Line Items] | |||||
Operating expenses | 0.0 | (0.5) | (0.4) | (0.5) | |
Affiliated entity | Golar LNG | |||||
Related Party Transaction [Line Items] | |||||
Operating expenses | (0.1) | 0.0 | (0.2) | 0.0 | |
Amounts due to related parties | (0.1) | (0.1) | $ 0.0 | ||
Affiliated entity | Schlumberger Limited | |||||
Related Party Transaction [Line Items] | |||||
Operating expenses | $ 0.0 | $ (2.4) | $ 0.0 | $ (4.3) |
Common Shares - Authorized Share Capital (Details) - $ / shares |
Jun. 24, 2021 |
Jan. 11, 2021 |
Jun. 30, 2021 |
Jan. 26, 2021 |
Dec. 31, 2020 |
---|---|---|---|---|---|
Equity [Abstract] | |||||
Ordinary shares, par value (in dollars per share) | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 |
Authorized shares (in shares) | 360,000,000 | 238,653,846 | |||
Stock authorized during period (in shares) | 70,000,000 | 51,346,154 |
Common Shares - Issued and Outstanding Share Capital (Details) - USD ($) |
3 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|
Jan. 26, 2021 |
Jan. 22, 2021 |
Mar. 31, 2021 |
Jun. 30, 2020 |
Jun. 30, 2021 |
Jun. 24, 2021 |
Mar. 18, 2021 |
Jan. 11, 2021 |
Dec. 31, 2020 |
|
Shares issued: | |||||||||
Ordinary shares, par value (in dollars per share) | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | ||||
Common stock, shares issued (in shares) | 158,431,911 | 274,436,351 | 220,318,704 | ||||||
Treasury shares (in shares) | 909,451 | 550,263 | 1,459,714 | ||||||
Outstanding (in shares) | 273,526,900 | 218,858,990 | |||||||
Gross proceeds | $ 46,000,000.0 | $ 30,000,000.0 | |||||||
Issued and fully paid share capital | $ 13,800,000 | $ 11,000,000.0 | |||||||
Common stock, shares issued (in shares) | 158,431,911 | 274,436,351 | 220,318,704 | ||||||
Depositary share | |||||||||
Shares issued: | |||||||||
Common stock, shares issued (in shares) | 274,436,351 | ||||||||
Gross proceeds | $ 2,700,000 | $ 46,000,000 | |||||||
Issue of common shares (in shares) | 54,117,647 | ||||||||
Price per share $ | $ 0.85 | ||||||||
Issued and fully paid share capital | $ 13,700,000 | ||||||||
Common stock, shares issued (in shares) | 274,436,351 |
Label | Element | Value |
---|---|---|
Accounting Standards Update [Extensible List] | us-gaap_AccountingStandardsUpdateExtensibleList | us-gaap:AccountingStandardsUpdate201613Member |
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