• Amplifying capital returns to shareholders with $60 million of share repurchases in Q2 and quarterly cash dividend initiated at $0.30 per share.
• Total backlog grows by 9% to $5.0 billion with new contracts totaling $0.8 billion secured over the past three months.
• Q2 Net Income of $66 million, Diluted Earnings Per Share of $0.45, Adjusted EBITDA of $188 million, net cash provided by operating activities of $211 million, and Free Cash Flow of $104 million.

SUGAR LAND, Texas, Aug. 2, 2023 /PRNewswire/ -- Noble Corporation plc (NYSE: NE, CSE: NOBLE, "Noble", or the "Company") today reported second quarter 2023 results.

Three Months Ended
(in June 30, 2023 June 30, 2022 March 31, 2023
millions,
except
per share
amounts)
Total $                   $                   $                    
Revenue 639 275 610
Contract 606 262 575
Drilling
Services
Revenue
Net Income 66 37 108
(Loss)
Adjusted 188 84 138
EBITDA*
Adjusted 56 33 27
Net Income
(Loss)*
Basic 0.48 0.53 0.80
Earnings
(Loss)
Per Share
Diluted 0.45 0.45 0.74
Earnings
(Loss) Per
Share
Adjusted 0.38 0.40 0.19
Diluted
Earnings
(Loss) Per
Share*

* A Non
-GAAP
supporting
schedule
is
included
with the
statements
and
schedules
attached
to
this press
release.

Robert W. Eifler, President and Chief Executive Officer of Noble Corporation plc, stated "Our second quarter results reflected solid operational and financial performance. Our recent initiation of a quarterly dividend starting at $0.30 per share, combined with $60 million of share repurchases in the second quarter, highlights our industry leading platform for cash flow generation and our commitment to returning capital to shareholders. We are realizing the combined benefits of the business combination with Maersk Drilling with our enhanced capabilities, we believe, allowing us to better serve our customers. Continuing improvement in the UDW market has driven our backlog to $5 billion, with several recent floater awards including the Noble Faye Kozack's 2.5-year contract in Brazil, and we are increasingly encouraged by the expanding geographic breadth of UDW demand worldwide."

Second Quarter Results
Contract drilling services revenue for the second quarter of 2023 totaled $606 million compared to $575 million in the first quarter, with the sequential increase driven by improving average dayrates. Marketed fleet utilization was 76% in the three months ended June 30, 2023 compared to 80% in the previous quarter. Contract drilling services costs for the second quarter were $363 million, flat versus the first quarter. Adjusted EBITDA increased to $188 million in the second quarter, up from $138 million in the first quarter. Net cash provided by operating activities in the second quarter was $211 million, capital expenditures were $107 million, and free cash flow (non-GAAP) was $104 million.

Balance Sheet and Capital Allocation
The Company's balance sheet as of June 30, 2023 reflected total debt principal value of $600 million and cash (and cash equivalents) of $255 million. Share repurchases totaled $60 million during the second quarter, bringing 2023 year-to-date share repurchases to $70 million, following approximately $86 million of cash used for share repurchases during the fourth quarter of 2022 (including the mandatory purchase associated with the Maersk Drilling squeeze-out).

Subsequent to the end of the second quarter, Noble announced the initiation of a planned quarterly interim dividend program, beginning with a $0.30 per share dividend to be paid on September 14, 2023 to shareholders of record at close of business on August 17, 2023.

Operating Highlights and Backlog
Noble's marketed fleet of sixteen floaters was 90% contracted through the second quarter, compared with 91% in the prior quarter. All sixteen marketed floaters continue to be consistently contracted with strong visibility for future follow-on opportunities, while utilization remains tempered slightly by gaps between contracts and planned SPS related downtime. Leading edge dayrates for working tier 1 drillships are in the mid to high-$400,000s; 6th generation floaters also continue to command a normal price discount to tier 1 drillships consistent with technical capability differentials.

• Noble Faye Kozack was awarded a 2.5 year contract with Petrobras, expected to commence in Q1 2024 and valued at approximately $500 million including mobilization and additional services.
• Noble Voyager was awarded a one-well contract from Shell for an exploration well in Mauritania at an undisclosed value. This contract follows in direct continuation of the current Shell contract in Colombia and is expected to extend the rig through year-end 2023.
• Noble Discoverer was awarded a one-well contract with Petronas in Suriname, expected to commence in August 2023, with an estimated duration of 90 days. The firm contract value is approximately $43 million, including additional services provided, mobilization and demobilization fees.
• Noble Viking had three option wells exercised by Shell, with total contract value of approximately $49 million and estimated total duration of 111 days. The first of these three option wells is scheduled to commence in December following the rig's SPS, and the rig's firm backlog is now extended into Q2 2025.
• Noble Deliverer received a nine-month extension from Inpex in Australia, expected to continue from July 2024 to April 2025 at a dayrate of $451,500.

Utilization of Noble's thirteen marketed jackups was 59% in the second quarter, compared with 67% utilization during the first quarter, with sequential downticks in utilization experienced by the Noble Tom Prosser, Noble Innovator and Noble Interceptor.

Commercial activity for the jackup fleet was subdued in the first half of 2023 but has recently begun to pick up, and we anticipate that jackup fleet utilization will begin improving based on existing and potential contracts. The warm stacked Noble Intrepid has recently been awarded a contract with Harbour Energy for 10 months of accommodation scope in the U.K. North Sea with a total contract value of $28.5 million. Additionally, the Noble Tom Prosser has recently commenced its long term program in Malaysia in July, and we believe the Noble Regina Allen is well positioned to resume operations by mid 2024 upon completion of repairs. Based on these dynamics and additional contract prospects over the near term, a steady recovery in jackup revenue and EBITDA contribution is expected to unfold over the coming quarters, with a more assertive recovery still predicated on demand dynamics in Norway and then North Sea from late 2024 onward.

Noble's backlog as of August 2, 2023 stands at $5.0 billion.

Outlook
For the full year 2023, Noble maintains the previously communicated guidance for total revenue in the range of $2.35 to $2.55 billion, Adjusted EBITDA of $725 to $825 million, and capital expenditures (net of reimbursable capex) between $325 and $365 million.

Commenting on Noble's outlook, Mr. Eifler stated, "Offshore fundamentals remain exceptionally strong, supporting a steady upward progression in contract status across our fleet. We expect UDW market tightness to persist and drive further upward pressure on dayrates going forward. With Adjusted EBITDA and Free Cash Flow expected to increase in the second half of the year versus the first half, we remain focused on maximizing shareholder value through best-in-class execution and returning the significant majority of free cash flow to shareholders."

Due to the forward-looking nature of Adjusted EBITDA, management cannot reliably predict certain of the necessary components of the most directly comparable forward-looking GAAP measure. Accordingly, the Company is unable to present a quantitative reconciliation of such forward-looking non-GAAP financial measure to the most directly comparable forward-looking GAAP financial measure without unreasonable effort. The unavailable information could have a significant effect on Noble's full year 2023 GAAP financial results.

Conference Call
Noble will host a conference call related to its second quarter 2023 results on Thursday, August 3rd, 2023, at 8:00 a.m. U.S. Central Time. Interested parties may dial +1 929-203-0901 and refer to conference ID 31391 approximately 15 minutes prior to the scheduled start time. Additionally, a live webcast link will be available on the Investor Relations section of the Company's website. A webcast replay will be accessible for a limited time following the scheduled call.

For additional information, visit www.noblecorp.com (https://c212.net/c/link/?t=0&l=en&o=3935209-1&h=239483774&u=https%3A%2F%2Fwww.noblecorp.com%2F&a=www.noblecorp.com) or email investors@noblecorp.com

Forward-looking Statements
This communication includes "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, as amended. All statements other than statements of historical facts included in this communication are forward looking statements, including those regarding future guidance, including revenue, adjusted EBITDA, the offshore drilling market and demand fundamentals, realization and timing of integration synergies, related costs to achieve, free cash flow expectations, capital expenditure, capital allocation expectations including planned dividend and share repurchases, contract backlog, rig demand, expected future contracts, anticipated contract start dates, dayrates and duration, fleet condition and utilization,  2023 and 2024 financial guidance, business, financial performance and position and our plans, objectives, expectations and intentions related to the Noble-Maersk merger. Forward-looking statements involve risks, uncertainties and assumptions, and actual results may differ materially from any future results expressed or implied by such forward-looking statements. When used in this report, or in the documents incorporated by reference, the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "on track," "plan," "possible," "potential," "predict," "project," "should," "would," "shall," "target," "will" and similar expressions are intended to be among the statements that identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot assure you that such expectations will prove to be correct. These forward-looking statements speak only as of the date of this communication and we undertake no obligation to revise or update any forward-looking statement for any reason, except as required by law. Risks and uncertainties include, but are not limited to, those detailed in Noble's most recent Annual Report on Form 10-K, Quarterly Reports Form 10-Q and other filings with the U.S. Securities and Exchange Commission.  We cannot control such risk factors and other uncertainties, and in many cases, we cannot predict the risks and uncertainties that could cause our actual results to differ materially from those indicated by the forward-looking statements. You should consider these risks and uncertainties when you are evaluating us. With respect to our capital allocation policy, distributions to shareholders in the form of either dividends or share buybacks are subject to the Board of Directors' assessment of factors such as business development, growth strategy, current leverage and financing needs. There can be no assurance that a dividend will be declared or continued.

NOBLE CORPORATION plc
AND
SUBSIDIARIESCONDENSED
CONSOLIDATED
STATEMENTS
OF OPERATIONS(In
thousands, except per
share
amounts)(Unaudited)

Three Months Six Months
Ended June 30, Ended June 30,
2023 2022 2023 2022
Operating revenues
   Contract drilling $         $         $      $         457,498
services 606,180 262,463 1,181,470
   Reimbursables and 32,355 12,690 67,119 27,885
other
638,535 275,153 1,248,589 485,383
Operating costs and
expenses
   Contract drilling 362,533 178,145 724,322 344,228
services
   Reimbursables 24,796 10,333 50,802 23,811
   Depreciation and 71,324 26,636 141,266 52,241
amortization
   General and 32,352 16,687 62,389 34,211
administrative
   Merger and 22,452 9,057 34,083 18,578
integration costs
   (Gain) loss on - 1,103 - (3,459)
sale
of operating assets,
net
   Hurricane losses 15,934 (14,407) 19,478 2,805
and
(recoveries), net
529,391 227,554 1,032,340 472,415
Operating income 109,144 47,599 216,249 12,968
(loss)
Other income
(expense)
   Interest expense, (14,662) (7,715) (31,534) (15,395)
net of amounts
capitalized
   Gain (loss) on (26,397) - (26,397) -
extinguishment of
debt,
net
   Interest income (2,940) 1,081 (914) 1,531
and
other, net
Income (loss) before 65,145 40,965 157,404 (896)
income taxes
   Income tax benefit 671 (3,908) 16,475 1,297
(provision)
Net income (loss) $          $          $         $              
65,816 37,057 173,879 401
Per share data
Basic:
   Net income (loss) $              $              $              $             
0.48 0.53 1.27 0.01
Diluted:
   Net income (loss) $              $              $              $                
0.45 0.45 1.19 -

 
NOBLE CORPORATION plc
AND
SUBSIDIARIESCONDENSED
CONSOLIDATED BALANCE
SHEETS(In
thousands)(Unaudited)

June 30, 2023 December 31, 2022
ASSETS
Current assets
   Cash and cash $            255,356 $            476,206
equivalents
   Accounts 516,800 468,802
receivable, net
   Prepaid expenses 160,462 106,782
and other current
assets
Total current assets 932,618 1,051,790
Intangible assets 17,018 34,372
Property and 4,329,002 4,163,205
equipment, at cost
   Accumulated (322,444) (181,904)
depreciation
Property and 4,006,558 3,981,301
equipment, net
Goodwill 14,626 26,016
Other assets 226,582 141,385
      Total assets $          5,197,402 $          5,234,864
LIABILITIES AND EQUITY
Current liabilities
   Current maturities $                     - $            159,715
of long-term debt
   Accounts payable 310,723 290,690
   Accrued payroll and 77,049 76,185
related costs
   Other current 126,379 140,508
liabilities
Total current 514,151 667,098
liabilities
Long-term debt 585,389 513,055
Other liabilities 298,650 265,743
Noncurrent contract 79,792 181,883
liabilities
      Total 1,477,982 1,627,779
liabilities
Commitments and
contingencies
Total shareholders' 3,719,420 3,607,085
equity
      Total $          5,197,402 $          5,234,864
liabilities and equity

 
NOBLE CORPORATION plc AND
SUBSIDIARIESCONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS(In
thousands)(Unaudited)

Six Months
Ended June
30,
2023 2022
Cash flows from operating activities
Net income (loss) $            $                  
173,879 401
Adjustments to reconcile net income (loss)
to net cash flow from operating activities:
   Depreciation and amortization 141,266 52,241
   Amortization of intangible assets and (84,737) 28,354
contract liabilities, net
   (Gain) loss on extinguishment of debt, 26,397 -
net
   (Gain) loss on sale of operating assets, - (6,767)
net
Changes in components of working capital
   Change in taxes receivable (20,284) (345)
   Net changes in other operating assets (88,441) (37,585)
and liabilities
Net cash provided by (used in) operating 148,080 36,299
activities
Cash flows from investing activities
   Capital expenditures (169,530) (79,525)
   Proceeds from disposal of assets, net - 15,756
Net cash provided by (used in) investing (169,530) (63,769)
activities
Cash flows from financing activities
   Issuance of senior notes 600,000 -
   Repayments of debt (673,411) -
   Debt extinguishment costs (25,697) -
   Debt issuance costs (24,914) -
   Share repurchases (70,000) -
   Other financing activities (8,253) (4,486)
Net cash provided by (used in) financing (202,275) (4,486)
activities
Net increase (decrease) in cash, cash (223,725) (31,956)
equivalents and restricted cash
Cash, cash equivalents and restricted cash, 485,707 196,722
beginning of period
Cash, cash equivalents and restricted cash, $            $           
end of period 261,982 164,766

 
NOBLE CORPORATION plc AND SUBSIDIARIESOPERATIONAL INFORMATION(Unaudited)

Average Rig Utilization
Three Months Ended Three Months Ended Three Months Ended
June 30, 2023 March 31, 2023 June 30, 2022
Floaters 76 % 77 % 81 %
Jackups 62 % 70 % 68 %
Total 70 % 74 % 76 %

Operating Days
Three Months Ended Three Months Ended Three Months Ended
June 30, 2023 March 31, 2023 June 30, 2022
Floaters 1,305 1,314 813
Jackups 786 877 495
Total 2,091 2,191 1,308

Average Dayrates
Three Months Ended Three Months Ended Three Months Ended
June 30, 2023 March 31, 2023 June 30, 2022
Floaters $           363,167 $           331,705 $           266,887
Jackups 128,885 97,940 120,824
Total $           275,066 $           238,130 $           211,626

 
NOBLE CORPORATION plc
AND
SUBSIDIARIESCALCULATION
OF BASIC AND DILUTED
NET INCOME/(LOSS) PER
SHARE(In thousands,
except per share
amounts)(Unaudited)

The following tables
presents the
computation of basic
and diluted income
(loss) per share:

Three Months Six Months
Ended June Ended June
30, 30,
2023 2022 2023 2022
Numerator:
Net income (loss) $         $         $       $             
65,816 37,057 173,879 401
Denominator:
Weighted average shares 138,058 69,789 136,502 68,722
outstanding - basic
Dilutive effect of 3,242 3,378 3,242 3,378
share-based awards
Dilutive effect of 5,692 9,535 6,810 9,185
warrants
Weighted average shares 146,992 82,702 146,554 81,285
outstanding - diluted
Per share data
Basic:
   Net income (loss) $             $             $             $            
0.48 0.53 1.27 0.01
Diluted:
   Net income (loss) $             $             $             $               
0.45 0.45 1.19 -

NOBLE CORPORATION plc AND SUBSIDIARIES
NON-GAAP MEASURES AND RECONCILIATION

Certain non-GAAP 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.

The Company defines "Adjusted EBITDA" as net income (loss) adjusted for interest expense, net of amounts capitalized; interest income and other, net; income tax benefit (provision); and depreciation and amortization expense, as well as, if applicable, gain (loss) on extinguishment of debt, net; losses on economic impairments; restructuring and similar charges; costs related to mergers and integrations; and certain other infrequent operational events. We believe that the Adjusted EBITDA measure provides greater transparency of our core operating performance. We prepare Adjusted Net Income (Loss) by eliminating from Net Income (Loss) the impact of a number of non-recurring items we do not consider indicative of our on-going performance. We prepare Adjusted Diluted Earnings (Loss) per Share by eliminating from Diluted Earnings per Share the impact of a number of non-recurring items we do not consider indicative of our on-going performance. Similar to Adjusted EBITDA, we believe these measures help identify underlying trends that could otherwise be masked by the effect of the non-recurring items we exclude in the measure.

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 2, 2023, are appropriate measures of the continuing and normal operations of the Company:

(i)    In the second quarters of 2023 and 2022, merger and integration costs;
      hurricane losses and (recoveries), net; intangible contract
amortization and discrete tax items.
(ii)   The second quarter of 2023 included a loss on extinguishment of debt,
      net.
(iii) In addition, the second quarter of 2022 included (gain) loss on sale
      of operating assets, net and professional services costs related to
corporate initiatives.

The Company also discloses free cash flow as a non-GAAP liquidity measure. Free cash flow is calculated as Net cash provided by (used in) operating activities less cash paid for capital expenditures. We believe Free Cash Flow is useful to investors because it measures our ability to generate or use cash. Once business needs and obligations are met, this cash can be used to reinvest in the company for future growth or to return to shareholders through dividend payments or share repurchases.

We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects, and allow for greater transparency with respect to key metrics used by our management team for financial and operational decision-making. We are presenting these non-GAAP financial measures to assist investors in seeing our financial performance through the eyes of management, and because we believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.

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

NOBLE CORPORATION
plc AND
SUBSIDIARIESNON
-GAAP MEASURES(In
thousands, except
per share
amounts)(Unaudited)

Reconciliation of
Adjusted EBITDA
Three Months Ended Three Months
June 30, Ended
2023 2022 March 31, 2023
Net income (loss) $              $              $             
65,816 37,057 108,063
Income tax (671) 3,908 (15,804)
(benefit) provision
Interest expense, 14,662 7,715 16,872
net of amounts
capitalized
Interest income and 2,940 (1,081) (2,026)
other, net
Depreciation and 71,324 26,636 69,942
amortization
Amortization of (31,009) 14,256 (53,728)
intangible assets
and contract
liabilities, net
(Gain) loss on 26,397 - -
extinguishment of
debt, net
Professional - 145 -
services -
corporate
projects
Merger and 22,452 9,057 11,631
integration costs
(Gain) loss on sale - 1,103 -
of operating
assets, net
Hurricane losses 15,934 (14,407) 3,544
and
(recoveries), net
Adjusted EBITDA $            $              $             
187,845 84,389 138,494

Reconciliation of
Income Tax
(Provision) Benefit
Three Months Ended Three Months
June 30, Ended
2023 2022 March 31, 2023
Income tax benefit $                   $               $               
(provision) 671 (3,908) 15,804

Adjustments
   Amortization of 3,747 (2,994) 3,501
intangible
assets and contract
liabilities,
net
   Hurricane losses - (164) -
and
(recoveries), net
   Discrete tax (47,601) (11,105) (45,631)
items
Total Adjustments (43,854) (14,263) (42,130)
Adjusted income tax $             $             $              
benefit (43,183) (18,171) (26,326)
(provision)

 
NOBLE
CORPORATION plc AND
SUBSIDIARIESNON
-GAAP
RECONCILIATION(In
thousands,
except per share
amounts)(Unaudited)

Reconciliation of
Net Income
(Loss)
Three Months Ended Three Months Ended
June 30,
2023 2022 March 31, 2023
Net income (loss) $              $              $             
65,816 37,057 108,063

Adjustments
   Amortization of (27,262) 11,262 (50,227)
intangible
assets and contract
liabilities,
net
   Professional - 145 -
services -
corporate projects
   Merger and 22,452 9,057 11,631
integration costs
   (Gain) loss on - 1,103 -
sale of
operating assets,
net
   Hurricane losses 15,934 (14,571) 3,544
and
(recoveries), net
   (Gain) loss on 26,397 - -
extinguishment
of debt, net
   Discrete tax (47,601) (11,105) (45,631)
items
Total Adjustments (10,080) (4,109) (80,683)
Adjusted net income $              $              $               
(loss) 55,736 32,948 27,380

Reconciliation of
Diluted EPS
Three Months Ended Three Months Ended
June 30,
2023 2022 March 31, 2023
Unadjusted diluted $                  $                  $                   
EPS 0.45 0.45 0.74

Adjustments
   Amortization of (0.19) 0.14 (0.34)
intangible
assets and contract
liabilities,
net
   Professional - - -
services -
corporate projects
   Merger and 0.15 0.11 0.08
integration costs
   (Gain) loss on - 0.01 -
sale of
operating assets,
net
   Hurricane losses 0.11 (0.18) 0.02
and
(recoveries), net
   (Gain) loss on 0.18 - -
extinguishment
of debt, net
   Discrete tax (0.32) (0.13) (0.31)
items
Total Adjustments (0.07) (0.05) (0.55)
Adjusted diluted $                  $                  $                   
EPS 0.38 0.40 0.19

Reconciliation of
Free Cash Flow
Three Months Ended Three Months Ended
June 30,
2023 2022 March 31, 2023
Net cash provided $            $              $              
by (used in) 211,160 88,112 (63,080)
operating
activities
Capital (106,796) (32,480) (62,734)
expenditures
Free cash flow $            $              $            
104,364 55,632 (125,814)

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