EX-99 2 release1q09.htm PRESS RELEASE release1q09.htm
 
EXHIBIT 99

News Release
 
Rowan Companies, Inc.
2800 Post Oak Boulevard, Suite 5450
   Houston, Texas 77056 (713) 621-7800
ROWAN REPORTS FIRST QUARTER 2009 OPERATING RESULTS
 
 
FOR IMMEDIATE RELEASE                                                                                                                                            May 7, 2009
 
HOUSTON, TEXAS – For the three months ended March 31, 2009, Rowan Companies, Inc. (RDC – NYSE) generated net income of $131.7 million or $1.16 per share, compared to $98.6 million or $0.88 per share in the first quarter of 2008 and $94.3 million or $0.83 per share in the fourth quarter of 2008.  Revenues were $494.8 million in the first quarter of 2009, compared to $485.5 million in the first quarter of 2008 and $613.0 million in the fourth quarter of 2008.
 
The first quarter 2009 results included $4.7 million of gains on asset disposals or $0.02 per share, compared to $5.4 million or $0.04 per share in the first quarter of 2008 and $39.5 million, or $0.23 per share in the fourth quarter of 2008.  The fourth quarter 2008 results also included $111.2 million, or $0.68 per share of impairment charges and other expenses; there were no such charges in the first quarter of 2009.
 
Rowan’s drilling operations generated revenues of $380.4 million in the first quarter of 2009, up by 12% over the prior-year quarter due primarily to rigs added in the fourth quarter, but down by 2% from the fourth quarter of 2008 due primarily to lower utilization.  The Company’s income from drilling operations was $187.1 million in the first quarter of 2009, up by 30% over the first quarter of 2008 but down by 7% from the fourth quarter of 2008.  The Company’s income from manufacturing operations was $11.1 million in the first quarter of 2009.
 
Matt Ralls, President and Chief Executive Officer, commented, “We are very pleased with the strong performance of both our drilling and manufacturing operations in the first quarter of 2009, particularly in the area of cost reduction.  This is an area of considerable focus for Rowan, especially as weakening demand for drilling services and equipment continues to put downward pressure on our revenues.
 
”While all of our jack-ups are under contract today, we are likely to have idle time on jack-ups in both the Gulf of Mexico and the Middle East in the near future.  Nonetheless, we continue to believe that the quality of our rigs and our operational reputation will enable us to maintain above average utilization of our available jack-ups”.
 

 
 
 

Rowan will conduct its earnings conference call on Thursday, May 7, 2009, at 10:00 a.m. Central Daylight Time.  Interested parties are invited to listen to the call by telephone or over the Internet.  Individuals who wish to participate on the conference call by telephone can dial (877) 723-9520, or internationally (719) 325-4841, using access code: 7052414.  Alternatively, to access the online simulcast and rebroadcast of the conference call, please visit Rowan’s website at www.rowancompanies.com.  You should connect to our website at least 15 minutes prior to the conference call to register, download and install any necessary software.

Rowan Companies, Inc. is a major provider of international and domestic contract drilling services.  The Company also owns and operates a manufacturing division that produces equipment for the drilling, mining and timber industries.  The Company’s stock is traded on the New York Stock Exchange.  Common Stock trading symbol: RDC.  Contact: Suzanne M. McLeod, Director of Investor Relations, 713-960-7517.  Website: www.rowancompanies.com
 

This report contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected financial performance of the Company that are based on current expectations and are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected by the Company.  Among the factors that could cause actual results to differ materially include oil and natural gas prices, the level of offshore expenditures by energy companies, energy demand, the general economy, including inflation, weather conditions in the Company’s principal operating areas and environmental and other laws and regulations.  Other relevant factors have been disclosed in the Company’s filings with the U.S. Securities and Exchange Commission.

 
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ROWAN COMPANIES, INC.
  
CONDENSED CONSOLIDATED BALANCE SHEETS
  
Unaudited (In Millions)
  
             
             
   
MARCH 31
  
   
2009
    
2008
  
             
ASSETS
            
             
Cash  and  cash  equivalents
   $ 192.8     $ 288.9  
Accounts  receivable
     443.1       438.4  
Inventories
     564.8       512.5  
Other  current  assets
     97.1       66.1  
     Total  current  assets
     1,297.8       1,305.9  
Property,  plant  and  equipment  -  net
     3,242.5       2,627.0  
Other  assets
     28.3       33.6  
     TOTAL
   $ 4,568.6     $ 3,966.5  
                 
                 
LIABILITIES  AND  STOCKHOLDERS'  EQUITY
                
                 
Current  maturities  of  long-term  debt
   $ 64.9     $ 64.9  
Accounts  payable
     157.7       103.8  
Other  current  liabilities
     397.7       324.2  
     Total  current  liabilities
     620.3       492.9  
Long-term  debt
     336.9       401.8  
Other  liabilities
     817.1       618.3  
Stockholders'  equity
     2,794.3       2,453.5  
     TOTAL
   $ 4,568.6     $ 3,966.5  
                 



 
 
 
 
 

 
 
 
 
 
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ROWAN COMPANIES, INC.
  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
  
Unaudited (In Millions Except Per Share Amounts)
  
             
             
   
THREE MONTHS
  
   
ENDED MARCH 31
  
   
2009
    
2008
  
             
REVENUES
   $ 494.8     $ 485.5  
                 
COSTS  AND  EXPENSES:
                
Operations  (excluding  items  shown  below)
     236.2       282.7  
Depreciation  and  amortization
     40.5       33.1  
Selling,  general  and  administrative
     24.6       27.4  
Gain  on  sale  of  property  and  equipment
     (4.7 )     (5.4 )
Total
     296.6       337.8  
INCOME  FROM  OPERATIONS
     198.2       147.7  
Net  interest  and  other  income
     1.4       2.7  
INCOME  BEFORE  INCOME  TAXES
     199.6       150.4  
Provision  for  income  taxes
     67.9       51.8  
NET  INCOME
   $ 131.7     $ 98.6  
                 
NET  INCOME  PER  DILUTED  SHARE
   $ 1.16     $ 0.88  
                 
AVERAGE  DILUTED  SHARES
     113.2       112.6  


 
 
 
 
 


 
 
 
 
 
-4-
 
 
 


ROWAN COMPANIES, INC.
  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
  
Unaudited (In Millions)
  
             
   
THREE MONTHS
  
   
ENDED MARCH 31
  
   
2009
    
2008
  
CASH  PROVIDED  BY  (USED  IN):
            
   Operations:
            
      Net income
   $ 131.7     $ 98.6  
      Adjustments  to  reconcile  net  income  to  net cash  provided  by  operations:
                
         Depreciation  and  amortization
     40.5       33.1  
         Deferred  income  taxes
     25.0       9.5  
         Gain  on  disposals  of  assets
     (4.7 )     (5.4 )
         Other -  net
     6.3       9.8  
      Net  changes  in  current  assets  and  liabilities
     (120.7 )     (28.9 )
      Net  changes  in  other  noncurrent  assets  and  liabilities
     (0.8 )     (8.1 )
   Net  cash  provided  by  operations
     77.3       108.6  
                 
   Investing  activities:
                
      Property,  plant  and  equipment  additions
     (93.6 )     (156.2 )
      Proceeds  from  disposals  of  property,  plant  and  equipment
     5.3       16.7  
      Decrease  in  Restricted  cash  balance
     -       50.0  
   Net  cash  provided  by  (used  in)  investing  activities
     (88.3 )     (89.5 )
                 
   Financing  activities:
                
      Repayments  of  borrowings
     (18.7 )     (18.7 )
      Payment  of  cash  dividends
     -       (11.1 )
      Proceeds  from  equity  compensation  plans  and  other
     0.1       15.1  
   Net  cash  used  in  financing  activities
     (18.6 )     (14.7 )
                 
INCREASE  (DECREASE)  IN  CASH  AND  CASH  EQUIVALENTS
     (29.6 )     4.4  
CASH  AND  CASH  EQUIVALENTS,  BEGINNING  OF  PERIOD
     222.4       284.5  
CASH  AND  CASH  EQUIVALENTS,  END  OF  PERIOD
   $ 192.8     $ 288.9  
                 



 


 

 
 
 
 
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ROWAN  COMPANIES,  INC.
SUPPLEMENTAL  DRILLING  INFORMATION
Unaudited  (dollars  in  millions,  except  where  otherwise  indicated )
                                             
             
THREE  MONTHS  ENDED
             
March 31, 2009
  
December 31, 2008
  
March 31, 2008
             
$ (a)
  
Elims.
  
$ (b)
% Revs.
  
$ (a)
  
Elims.
  
$ (b)
% Revs.
  
$
% Revs.
                                             
DRILLING  OPERATIONS:
                                      
 
Revenues
        
 $    380.4
      
 $    380.4
     100
  
 $    386.7
      
 $    386.7
     100
  
 $    340.4
     100
 
Operating  costs  (excluding  items  shown  below)
  
     (146.6)
  
 $  1.2
  
     (145.4)
      (38)
  
     (147.1)
  
 $  0.4
  
     (146.7)
      (38)
  
     (156.5)
      (46)
 
Depreciation  and  amortization  expense
    
       (36.8)
      
       (36.8)
      (10)
  
       (34.7)
      
       (34.7)
        (9)
  
       (29.2)
        (9)
 
Selling,  general  and  administrative  expenses (c)
  
       (15.8)
      
       (15.8)
        (4)
  
       (18.6)
      
       (18.6)
        (5)
  
       (16.5)
        (5)
 
Gain  on  sale  of  property  and  equipment
  
           4.7
      
           4.7
         1
  
         39.6
      
         39.6
       10
  
           5.4
         2
 
Material  charges  and  other  operating  expenses
  
             -
      
             -
          -
  
       (24.6)
      
       (24.6)
        (6)
  
             -
          -
   
Income  from  operations
      
 $    185.9
  
 $  1.2
  
 $    187.1
       49
  
 $    201.3
  
 $  0.4
  
 $    201.7
       52
  
 $    143.6
       42
   
EBITDA (d)
        
 $    218.0
  
 $  1.2
  
 $    219.2
       58
  
 $    221.0
  
 $  0.4
  
 $    221.4
       57
  
 $    167.4
       49
                                             
OFFSHORE  RIG  DAYS:
                                      
 
Operating
                
       1,841
            
       1,911
    
       1,745
  
 
Available
                
       1,980
            
       1,926
    
       1,911
  
   
Utilization
                
93%
            
99%
    
91%
  
                                             
LAND  RIG  DAYS:
                                      
 
Operating
                
       2,055
            
       2,485
    
       2,358
  
 
Available
                
       2,766
            
       2,758
    
       2,639
  
   
Utilization
                
74%
            
90%
    
89%
  
                                             
AVERAGE  DAY  RATES  (in  thousands):
                                    
 
Gulf  of  Mexico  rigs
              
 $    155.5
            
 $    144.6
    
 $    114.1
  
 
Middle  East  rigs
              
       150.1
            
       156.9
    
       151.7
  
 
North  Sea  rigs
                
       279.8
            
       272.1
    
       243.8
  
 
All  offshore  rigs
              
       173.6
            
       170.1
    
       159.7
  
 
Land  rigs
                
         25.5
            
         23.7
    
         23.2
  
                                             
   
(a)  Amounts include effects of intercompany transactions between drilling and manufacturing operations.
   
(b)  Amounts exclude effects of intercompany transactions.
   
(c)  Amounts include corporate SG&A costs that are allocated between operating segments.
   
(d)  EBITDA (earnings before interest, taxes, depreciation and amortization) is a non-GAAP financial measure that we believe is relevant to our stockholders.
   
      We measure EBITDA as operating income plus depreciation less gain on sale and material charges.




 
 
 
 
-6-
 
 


ROWAN  COMPANIES,  INC.
SUPPLEMENTAL  MANUFACTURING  INFORMATION
Unaudited  (dollars  in  millions)
                                                 
                                                 
             
THREE  MONTHS  ENDED
             
March 31, 2009
  
December 31, 2008
  
March 31, 2008
             
$ (a)
% Revs.
  
Elims.
  
$ (b)
% Revs.
  
$ (a)
% Revs.
  
Elims.
  
$ (b)
% Revs.
  
$
% Revs.
                                                 
MANUFACTURING  OPERATIONS:
                                        
 
Revenues
        
 $   187.9
   100
  
 $  (73.5)
  
 $  114.4
   100
  
 $   351.1
   100
  
 $(124.8)
  
 $  226.3
   100
  
 $   145.1
    100
 
Operating  costs (excluding  items  shown  below)
  
     (143.8)
    (77)
  
       53.0
  
     (90.8)
    (79)
  
     (269.0)
    (77)
  
       99.0
  
   (170.0)
    (75)
  
    (126.2)
    (87)
 
Depreciation  and  amortization  expense
  
         (3.7)
      (2)
      
       (3.7)
      (3)
  
         (3.9)
      (1)
      
       (3.9)
      (2)
  
        (3.9)
      (3)
 
Selling,  general  and  administrative  expenses (c)
  
         (8.8)
      (5)
      
       (8.8)
      (8)
  
       (10.8)
      (3)
      
     (10.8)
      (5)
  
      (10.9)
      (8)
 
Gain  (loss)  on  sale  of  property  and  equipment
  
             -
        -
      
           -
        -
  
         (0.2)
      (0)
      
       (0.2)
      (0)
  
            -
         -
 
Material  charges  and  other  operating  expenses
  
             -
        -
      
           -
        -
  
       (86.6)
    (25)
      
     (86.6)
    (38)
  
            -
         -
   
Income  from  operations
      
 $     31.6
     17
  
 $  (20.5)
  
 $    11.1
     10
  
 $    (19.4)
      (6)
  
 $  (25.8)
  
 $  (45.2)
    (20)
  
 $       4.1
        3
   
EBITDA (d)
        
 $     35.3
     19
  
 $  (20.5)
  
 $    14.8
     13
  
 $     71.3
     20
  
 $  (25.8)
  
 $    45.5
     20
  
 $       8.0
        6
                                                 
                                                 
REVENUES:
                                            
 
Drilling  Products  and  Systems
    
 $   144.6
     77
  
 $  (73.5)
  
 $    71.1
     62
  
 $   257.9
     73
  
 $(124.8)
  
 $  133.1
     59
  
 $     91.1
      63
 
Mining,  Forestry  and  Steel  Products
    
        43.3
     23
  
           -
  
       43.3
     38
  
        93.2
     27
  
           -
  
       93.2
     41
  
        54.0
      37
   
Total
        
 $   187.9
   100
  
 $  (73.5)
  
 $  114.4
   100
  
 $   351.1
   100
  
 $(124.8)
  
 $  226.3
   100
  
 $   145.1
    100
                                                 
                                                 
MANUFACTURING  BACKLOG:
                                        
 
Drilling  Products  and  Systems
    
 $   994.8
    
 $(448.9)
  
 $  545.9
    
 $   995.9
    
 $(505.2)
  
 $  490.7
    
 $   366.7
  
 
Mining,  Forestry  and  Steel  Products
    
        47.5
    
           -
  
       47.5
    
        71.3
    
           -
  
       71.3
    
        70.7
  
   
Total
        
 $1,042.3
    
 $(448.9)
  
 $  593.4
    
 $1,067.2
    
 $(505.2)
  
 $  562.0
    
 $   437.4
  
                                                 
                                                 
   
(a)  Amounts include effects of intercompany transactions between manufacturing and drilling operations.
   
(b)  Amounts exclude effects of intercompany transactions.
   
(c)  Amounts include corporate SG&A costs that are allocated between operating segments.
   
(d)  EBITDA (earnings before interest, taxes, depreciation and amortization) is a non-GAAP financial measure that we believe is relevant to our stockholders.
   
      We measure EBITDA as operating income plus depreciation less gain on sale and material charges.







 
 
 
-7-