8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (date of earliest event reported): August 1, 2019

 

 

NOBLE CORPORATION plc

(Exact name of registrant as specified in its charter)

 

England and Wales    001-36211    98-0619597
(State or other jurisdiction of incorporation)    (Commission file number)    (I.R.S. employer identification no.)

 

10 Brook Street, London, England    W1S1BG
(Address of principal executive offices)    (Zip code)

Registrant’s telephone number, including area code: +44 20 3300 2300

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trade symbol (s)

 

Name of each exchange on which registered

Shares, Nominal Value $0.01 per Share   NE   New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 


Item 2.02.

Results of Operations and Financial Condition.

On August 1, 2019, Noble Corporation plc (the “Company”) issued a press release announcing its condensed consolidated financial results for the quarter ended June 30, 2019. A copy of such press release is included as Exhibit 99.1 and will be published in the “Investor Relations” area on the Company’s web site at http://www.noblecorp.com.

Pursuant to the rules and regulations of the Securities and Exchange Commission, the press release is being furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934.

 

Item 9.01.

Financial Statements and Exhibits.

 

  (d)

Exhibits

 

Exhibit 99.1    Press Release issued by Noble Corporation plc dated August 1, 2019.

 

2


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    NOBLE CORPORATION plc
Date: August 1, 2019     By:   /s/ Adam C. Peakes
           Adam C. Peakes
           Senior Vice President and Chief Financial Officer

 

3

EX-99.1

Exhibit 99.1

 

Noble Corporation plc

10 Brook Street

London W1S 1BG

England

  LOGO

 

 

PRESS RELEASE

NOBLE CORPORATION PLC REPORTS

SECOND QUARTER 2019 RESULTS

HIGHLIGHTS AND RECENT ACCOMPLISHMENTS:

 

   

Fleet operating days advanced 13 percent from the previous quarter

 

   

New managed pressure drilling (MPD) capability successfully deployed

 

   

Utilization of nine active floating rigs improved to 89 percent

 

   

Contract awards and extensions through June 30, 2019, totaled $303 million

LONDON, August 1, 2019 – Noble Corporation plc (NYSE: NE, the Company) today reported a net loss attributable to the Company for the three months ended June 30, 2019 (second quarter) of $152 million, or $0.61 per diluted share, on total revenues of $293 million. Results for the second quarter included the following items:

 

   

A charge totaling $100 million, or $0.40 per diluted share, related to the Paragon Offshore litigation.

 

   

A net gain totaling $34 million, or $0.13 per diluted share, relating to the release of reserves for tax positions following the settlement of the examination of the Company’s U.S. tax returns for the years ended December 31, 2010, and 2011.

Excluding these items, the Company would have reported a net loss attributable to Noble Corporation plc for the three months ended June 30, 2019, of $86 million, or $0.34 per diluted share.

With regard to the Paragon Offshore litigation charge, which was recorded as general and administrative expense, the Company continues to believe that it acted properly and that Paragon was adequately funded at the time of the August 2014 spinoff. However, the matter involves complex factual issues, and there is inherent risk and uncertainty in this type of litigation.

 

MORE


Commenting on the Company’s quarterly performance, Julie J. Robertson, Chairman, President and Chief Executive Officer of Noble Corporation plc, stated, “Total fleet operating days in the second quarter were 13 percent better than the first quarter due to the addition of the Noble Johnny Whitstine and the completion of a reactivation program on the Noble Sam Croft. The increase in operating days raised our total fleet utilization to the highest level since the industry downturn began, with the jackup fleet reaching an industry-best 98 percent in the quarter, while our floating rigs, excluding three-cold-stacked units, improved to 89 percent.”

Contract drilling services revenues for the second quarter totaled $275 million, up from $271 million in the first quarter. The modest improvement was aided by higher total fleet utilization, which reached 82 percent in the second quarter compared to 76 percent in the first quarter, and reflected higher operating days on the Noble Sam Croft and Noble Tom Prosser, as well as the commencement of operations on the jackup Noble Johnny Whitstine. Also, revenues were supported by the utilization of a MPD system on the Noble Globetrotter II, as well as additional calendar days in the quarter. These items were offset by a 10 percent decline in average daily revenues, largely attributable to the floating rig fleet, and a slight increase in fleet downtime.

Contract drilling services costs declined to $169 million in the second quarter compared to $172 million in the first quarter. The two percent reduction was due largely to lower repair and maintenance expense and other rig-related costs, partially offset by an increase in operations support costs. The Company’s contract drilling services margin in the second quarter improved to 39 percent, up from 37 percent in the first quarter.

Operating Highlights

Utilization of the Company’s floating rig fleet, consisting of eight drillships and four semisubmersibles, continued to strengthen with second quarter utilization improving to 67 percent compared to 60 percent in the first quarter. Excluding three cold-stacked floaters, active fleet utilization for the second quarter was 89 percent compared to 80 percent in the prior quarter. The improvement was due largely to a full quarter of operations for the drillship Noble Sam Croft, which completed a reactivation project during the first quarter of 2019. Floating fleet revenues declined six percent in the second quarter compared to the previous quarter, due largely to the conclusion of a legacy contract for the drillship Noble Don Taylor in February 2019, and the April 2019 completion of a drilling program offshore the Eastern Mediterranean for the Noble Globetrotter I. The decline was partially offset by an enhanced dayrate in the second quarter for the Noble Globetrotter II, due to the application of the MPD system, and higher operating days on the Noble Sam Croft. With regard to the Noble Globetrotter I, the rig was relocated to the U.S. Gulf of Mexico during the second quarter and will be joined in the third quarter by the Noble Globetrotter II, which is currently in transit to the region following the conclusion of a drilling assignment in the Black Sea. The Noble Sam Croft and Noble Don Taylor are expected to exit the U.S. Gulf of Mexico during the third quarter to begin drilling assignments offshore Suriname and Guyana, respectively. At June 30, 2019, eight of the Company’s nine active floating rigs were under contract, with seven of the nine rigs committed into 2020, or beyond. An estimated 57 percent of the available floating rig days over the next twelve months are committed to contracts compared to 49 percent at the beginning of 2019.

 

2


Utilization in the second quarter of the Company’s jackup fleet improved to 98 percent compared to 93 percent in the first quarter, driving an 11 percent advance in revenues. The increase was attributable to the commencement in April of operations on the Noble Johnny Whitstine offshore Saudi Arabia, and a full quarter of operations on the Noble Tom Prosser offshore Australia. These improvements were partially offset by fewer operating days for the Noble Houston Colbert following the conclusion in June of a contract offshore Qatar. The rig is currently in transit to the UK North Sea where it is expected to commence an estimated seven-month contract later this year. Also, project commissioning and customer requested upgrades continue on the recently acquired jackup Noble Joe Knight. The rig remains on schedule for a September 2019 commencement of a three-year contract offshore Saudi Arabia. At June 30, 2019, all 13 of the Company’s jackup rigs were contracted, with 73 percent of the available jackup fleet rig days over the next twelve months committed to contracts.

Backlog, Capital and Balance Sheet

The Company reported a total contract backlog of $2.1 billion at June 30, 2019, including approximately $1.33 billion contributed by the floating rig fleet and approximately $820 million by the jackup rig fleet. The Company secured contract awards and extensions totaling $303 million, including $164 million associated with the floating fleet and $139 million for the jackup fleet, during the first half of 2019. The total contract awards in 2019 compare favorably to $133 million of awards during the same six-month period in 2018, excluding a minor adjustment to the backlog for the Noble Bully II resulting from the extension of the rig’s idle period.

Capital expenditures in the second quarter of 2019 totaled $64 million compared to $83 million in the first quarter, which excluded the $54 million seller-financed portion of the Noble Joe Knight purchase price. Second quarter expenditures consisted of $27 million for sustaining capital, $35 million for major projects, rig reactivations and subsea equipment, and $2 million of capitalized interest. Capital spending in the second quarter for major projects was below the Company’s guidance due primarily to the timing of expenditures associated with the recently acquired jackups Noble Johnny Whitstine and Noble Joe Knight. The Company’s guidance for 2019 capital expenditures remains unchanged at $250 million, which excludes the seller-financed portion of the Noble Joe Knight purchase price.

 

3


In late-July 2019, the Company completed an amendment to its 2017 Credit Facility. The amended facility, which remained unsecured with maturity in January 2023, replaced the existing 55 percent debt-to-total-capitalization covenant with a new covenant that requires a ratio of senior guaranteed debt to adjusted earnings before interest, taxes and depreciation and amortization (EBITDA), and a limitation on total borrowings of no more than 15% of consolidated net tangible assets less other secured debt. Although total commitments under the amended credit facility were reduced to $1.3 billion from $1.5 billion, the amended covenant structure is expected to allow improved access to the facility.

At June 30, 2019, the Company reported cash and cash equivalents of $154 million and pro forma availability under the recently amended 2017 Credit Facility of $1.25 billion, or total pro forma liquidity of $1.4 billion.

Outlook

Addressing industry conditions, Ms. Robertson noted, “Steady recovery remains apparent with the industry’s marketed contracted utilization for both jackup and floating rigs individually reaching 81 percent at the close of June 2019, up from 74 percent and 76 percent for jackups and floating rigs, respectively, at the same time in 2018. Increasing customer demand for premium jackups is evident in regions such as Mexico, Southeast Asia and Australia, while a step-up in exploration activity is contributing to a build in the number of contracted floating rigs, including those deployed on deepwater programs. Through the first six months of 2019, ten deepwater exploration campaigns concluded with announced discoveries, setting a pace that could result in the strongest annual performance since the 22 discoveries in 2016.”

A Non-GAAP supporting schedule is included with the statements and schedules attached to this press release and can also be found at www.noblecorp.com. It provides a reconciliation for revenues, net loss, income tax and diluted earnings per share for the second quarter 2019, and the second quarter of 2018.

 

4


About Noble Corporation plc

Noble is a leading offshore drilling contractor for the oil and gas industry. The Company owns and operates one of the most modern, versatile and technically advanced fleets in the offshore drilling industry. Noble performs, through its subsidiaries, contract drilling services with a fleet of 25 offshore drilling units, consisting of 12 drillships and semisubmersibles and 13 jackups, focused largely on ultra-deepwater and high-specification jackup drilling opportunities in both established and emerging regions worldwide. Noble is a public limited company registered in England and Wales with company number 08354954 and registered office at 10 Brook Street, London, W1S 1BG England. Additional information on Noble is available at www.noblecorp.com.

Forward-looking Disclosure Statement

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

 

5


Conference Call

Noble has scheduled a conference call and webcast related to its second quarter 2019 results on Friday, August 2, 2019, at 8:00 a.m. U.S. Central Daylight Time. Interested parties are invited to listen to the call by dialing 1-833-245-9653, or internationally 1-647-689-4225, using access code: 2086607, or by asking for the Noble Corporation plc conference call. Interested parties may also listen over the Internet through a link posted in the Investor Relations section of the Company’s Website.

A replay of the conference call will be available on Friday, August 2, 2019, beginning at 11:00 a.m. U.S. Central Daylight Time, through Monday, September 2, 2019, ending at 11:00 p.m. U.S. Central Daylight Time. The phone number for the conference call replay is 1-800-585-8367 or, for calls from outside of the U.S., 1-416-621-4642, using access code: 2086607. The replay will also be available on the Company’s Website following the end of the live call.

For additional information, contact:

Jeffrey L. Chastain,

Vice President – Investor Relations and Corporate Communications,

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

 

6


NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2019     2018     2019     2018  

Operating revenues

        

Contract drilling services

   $ 274,817     $ 247,689     $ 545,318     $ 476,795  

Reimbursables and other

     18,119       10,680       30,506       16,731  
  

 

 

   

 

 

   

 

 

   

 

 

 
     292,936     258,369     575,824     493,526  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses

        

Contract drilling services

     168,865       151,437       340,593       288,286  

Reimbursables

     15,381       8,297       24,776       12,647  

Depreciation and amortization

     111,148       129,681       220,726       258,436  

General and administrative

     116,252       21,717       132,251       43,800  

Loss on impairment

     —         792,843       —         792,843  
  

 

 

   

 

 

   

 

 

   

 

 

 
     411,646     1,103,975     718,346     1,396,012  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

     (118,710     (845,606     (142,522     (902,486

Other income (expense)

        

Interest expense, net of amounts capitalized

     (68,976     (74,130     (139,220     (150,145

Gain (loss) on extinguishment of debt, net

     —         —         31,266       (8,768

Interest income and other, net

     1,860       2,865       4,366       4,204  
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from continuing operations before income taxes

     (185,826     (916,871     (246,110     (1,057,195

Income tax benefit

     37,182       38,839       34,317       35,843  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss from continuing operations

     (148,644     (878,032     (211,793     (1,021,352

Net loss from discontinued operations, net of tax

     —         —         (3,821     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

     (148,644     (878,032     (215,614     (1,021,352

Net (income) loss attributable to noncontrolling interests

     (3,316     249,969       (7,235     250,955  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (151,960   $ (628,063   $ (222,849   $ (770,397
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

        

Net loss from continuing operations

   $ (151,960   $ (628,063   $ (219,028   $ (770,397

Net loss from discontinued operations, net of tax

     —         —         (3,821     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (151,960   $ (628,063   $ (222,849   $ (770,397
  

 

 

   

 

 

   

 

 

   

 

 

 

Per share data

        

Basic:

        

Loss from continuing operations

   $ (0.61   $ (2.55   $ (0.88   $ (3.13

Loss from discontinued operations

     —         —         (0.02     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.61   $ (2.55   $ (0.90   $ (3.13
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted:

        

Loss from continuing operations

   $ (0.61   $ (2.55   $ (0.88   $ (3.13

Loss from discontinued operations

     —         —         (0.02     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.61   $ (2.55   $ (0.90   $ (3.13
  

 

 

   

 

 

   

 

 

   

 

 

 

 

7


NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

     June 30, 2019     December 31, 2018  
ASSETS  

Current assets

    

Cash and cash equivalents

   $ 153,766     $ 375,232  

Accounts receivable, net

     222,889       200,722  

Prepaid expenses and other current assets

     85,439       83,102  
  

 

 

   

 

 

 

Total current assets

     462,094       659,056  
  

 

 

   

 

 

 

Property and equipment, at cost

     11,080,690       10,956,412  

Accumulated depreciation

     (2,621,100     (2,475,694
  

 

 

   

 

 

 

Property and equipment, net

     8,459,590       8,480,718  
  

 

 

   

 

 

 

Other assets

     139,035       125,149  
  

 

 

   

 

 

 

Total assets

   $ 9,060,719     $ 9,264,923  
  

 

 

   

 

 

 
LIABILITIES AND EQUITY  

Current liabilities

    

Current maturities of long-term debt

   $ 300,000     $ —    

Accounts payable

     118,040       125,557  

Accrued payroll and related costs

     40,722       50,284  

Other current liabilities

     276,027       189,616  
  

 

 

   

 

 

 

Total current liabilities

     734,789       365,457  
  

 

 

   

 

 

 

Long-term debt

     3,553,088       3,877,402  

Other liabilities

     345,093       367,490  
  

 

 

   

 

 

 

Total liabilities

     4,632,970       4,610,349  
  

 

 

   

 

 

 

Commitments and contingencies

    

Equity

    

Total shareholders’ equity

     4,036,649       4,253,171  

Noncontrolling interests

     391,100       401,403  
  

 

 

   

 

 

 

Total equity

     4,427,749       4,654,574  
  

 

 

   

 

 

 

Total liabilities and equity

   $ 9,060,719     $ 9,264,923  
  

 

 

   

 

 

 

 

8


NOBLE CORPORATION PLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

     Six Months Ended June 30,  
     2019     2018  

Cash flows from operating activities

    

Net loss

   $ (215,614   $ (1,021,352

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

    

Depreciation and amortization

     220,726       258,436  

Loss on impairment

     —         792,843  

(Gain) loss on extinguishment of debt, net

     (31,266     8,768  

Changes in components of working capital:

    

Change in taxes receivable

     2,758       84,486  

Net changes in other operating assets and liabilities

     15,934       (69,287
  

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     (7,462     53,894  
  

 

 

   

 

 

 

Cash flows from investing activities

    

Capital expenditures

     (152,354     (75,874

Proceeds from disposal of assets, net

     9,367       3,755  
  

 

 

   

 

 

 

Net cash used in investing activities

     (142,987     (72,119
  

 

 

   

 

 

 

Cash flows from financing activities

    

Issuance of senior notes

     —         750,000  

Borrowings on credit facilities

     370,000       —    

Repayments of credit facilities

     (20,000     —    

Repayments of debt

     (400,000     (952,209

Debt issuance costs

     (90     (14,802

Dividends paid to noncontrolling interests

     (17,538     (12,694

Taxes withheld on employee stock transactions

     (2,761     (3,407
  

 

 

   

 

 

 

Net cash used in financing activities

     (70,389     (233,112
  

 

 

   

 

 

 

Net decrease in cash, cash equivalents and restricted cash

     (220,838     (251,337

Cash, cash equivalents and restricted cash, beginning of period

     375,907       662,829  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash, end of period

   $ 155,069     $ 411,492  
  

 

 

   

 

 

 

 

9


NOBLE CORPORATION PLC AND SUBSIDIARIES

FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT

(In thousands, except operating statistics)

(Unaudited)

 

     Three Months Ended June 30,     Three Months Ended March 31,  
     2019     2018     2019  
     Contract
Drilling
Services
    Other     Total     Contract
Drilling
Services
    Other     Total     Contract
Drilling
Services
    Other     Total  

Operating revenues

                  

Contract drilling services

   $ 274,817     $ —       $ 274,817     $ 247,689     $ —       $ 247,689     $ 270,501     $ —       $ 270,501  

Reimbursables and other

     18,119       —         18,119       10,680       —         10,680       12,387       —         12,387  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 292,936     $ —       $ 292,936     $ 258,369     $ —       $ 258,369     $ 282,888     $ —       $ 282,888  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses

                  

Contract drilling services

   $ 168,865     $ —       $ 168,865     $ 151,437     $ —       $ 151,437     $ 171,728     $ —       $ 171,728  

Reimbursables

     15,381             15,381       8,297       —         8,297       9,395       —         9,395  

Depreciation and amortization

     107,802       3,346       111,148       124,223       5,458       129,681       106,086       3,492       109,578  

General and administrative

     116,252       —         116,252       21,717       —         21,717       15,999       —         15,999  

Loss on impairment

     —         —         —         792,843       —         792,843       —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     $408,300     $3,346     $411,646     $1,098,517     $5,458     $1,103,975     $303,208     $3,492     $306,700  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating loss

   $ (115,364   $ (3,346   $ (118,710   $ (840,148   $ (5,458   $ (845,606   $ (20,320   $ (3,492   $ (23,812

Operating statistics

                  

Jackups:

                  

Average Rig Utilization

     98%           70%           93%      

Operating Days

     1,050           872           923      

Average Dayrate

     $124,572           $130,332           $127,150      

Floaters:

                  

Average Rig Utilization

     67%           39%           60%      

Operating Days

     728           499           647      

Average Dayrate

     $197,911           $268,588           $236,715      

Total:

                  

Average Rig Utilization

     82%           54%           76%      

Operating Days

     1,778           1,371           1,570      

Average Dayrate

     $154,609           $180,689           $172,305      

 

10


NOBLE CORPORATION PLC AND SUBSIDIARIES

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

(In thousands, except per share amounts)

(Unaudited)

The following table presents the computation of basic and diluted loss per share:

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2019     2018     2019     2018  

Numerator:

        

Basic

        

Net loss from continuing operations

   $ (151,960   $ (628,063   $ (219,028   $ (770,397

Net loss from discontinued operations, net of tax

     —         —         (3,821     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (151,960   $ (628,063   $ (222,849   $ (770,397
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

        

Net loss from continuing operations

   $ (151,960   $ (628,063   $ (219,028   $ (770,397

Net loss from discontinued operations, net of tax

     —         —         (3,821     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (151,960   $ (628,063   $ (222,849   $ (770,397
  

 

 

   

 

 

   

 

 

   

 

 

 

Denominator:

        

Weighted average shares outstanding – basic

     249,154       246,740       248,705       246,438  

Weighted average shares outstanding – diluted

     249,154       246,740       248,705       246,438  

Loss per share

        

Basic:

        

Loss from continuing operations

   $ (0.61   $ (2.55   $ (0.88   $ (3.13

Loss from discontinued operations

     —         —         (0.02     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.61   $ (2.55   $ (0.90   $ (3.13
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted:

        

Loss from continuing operations

   $ (0.61   $ (2.55   $ (0.88   $ (3.13

Loss from discontinued operations

     —         —         (0.02     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Noble Corporation plc

   $ (0.61   $ (2.55   $ (0.90   $ (3.13
  

 

 

   

 

 

   

 

 

   

 

 

 

 

11


NOBLE CORPORATION PLC AND SUBSIDIARIES

NON-GAAP RECONCILIATION

Certain non-GAAP performance measures and corresponding reconciliations to GAAP financial measures for the Company have been provided for meaningful comparisons between current results and prior operating periods. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. In order to fully assess the financial operating results, management believes that the results of operations, adjusted to exclude the following items, which are included in the Company’s press release issued on August 1, 2019, and discussed in the related conference call on August 2, 2019, are appropriate measures of the continuing and normal operations of the Company:

(i)     In the second quarter of 2019, a charge related to the Paragon litigation and a discrete tax item; and

(ii)    In the second quarter of 2018, an impairment of three of our rigs and certain capital spare equipment.

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

 

12


NOBLE CORPORATION PLC AND SUBSIDIARIES

NON-GAAP RECONCILIATION

(In thousands, except per share amounts)

(Unaudited)

 

Reconciliation of Income Tax Benefit (Provision)    Three Months Ended June 30,  
     2019     2018  

Income tax benefit (provision)

   $ 37,182     $ 38,839  

Adjustments

    

Loss on impairment

     —         (35,613

Discrete tax items

     (33,663     —    
  

 

 

   

 

 

 

Total Adjustments

     (33,663     (35,613
  

 

 

   

 

 

 

Adjusted income tax benefit (provision)

   $ 3,519     $ 3,226  
  

 

 

   

 

 

 
Reconciliation of Net Loss Attributable to Noble Corporation plc    Three Months Ended June 30,  
     2019     2018  

Net loss attributable to Noble Corporation plc

   $ (151,960   $ (628,063

Adjustments

    

Loss on impairment, net of tax

     —         757,230  

Net loss attributable to noncontrolling interests

     —         (250,348

Discrete tax items

     (33,663     —    

Legal contingencies

     100,000       —    
  

 

 

   

 

 

 

Total Adjustments

     66,337       506,882  
  

 

 

   

 

 

 

Adjusted net loss attributable to Noble Corporation plc

   $ (85,623   $ (121,181
  

 

 

   

 

 

 
Reconciliation of Diluted EPS Attributable to Noble Corporation plc    Three Months Ended June 30,  
     2019     2018  

Unadjusted diluted EPS attributable to Noble Corporation plc

   $ (0.61   $ (2.55

Adjustments

    

Loss on impairment

     —         2.06  

Discrete tax items

     (0.13     —    

Legal contingencies

     0.40       —    
  

 

 

   

 

 

 

Total Adjustments

     0.27       2.06  
  

 

 

   

 

 

 

Adjusted diluted EPS attributable to Noble Corporation plc

   $ (0.34   $ (0.49
  

 

 

   

 

 

 

 

13