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Exhibit 99.1

 

Noble Corporation plc

Devonshire House

1 Mayfair Place

London W1J 8AJ

England

   LOGO

PRESS RELEASE

NOBLE CORPORATION REPORTS FOURTH QUARTER AND

FULL YEAR 2013 RESULTS

London, January 22, 2014 – Noble Corporation (NYSE: NE) today reported fourth quarter 2013 net income of $174 million, or $0.68 per diluted share. Results for the fourth quarter included an after tax charge of $36 million, or $0.14 per diluted share, relating to an impairment taken on the FPSO Seillean. Excluding the impairment charge, net income for the fourth quarter would have totaled $210 million, or $0.82 per diluted share. For the third quarter of 2013, the Company reported net income of $282 million, or $1.10 per diluted share, which included after tax gains totaling approximately $63 million, or $0.25 per diluted share. Excluding the gains, net income in the third quarter would have been $219 million, or $0.85 per diluted share. During the fourth quarter of 2012, net income was $128 million, or $0.50 per diluted share. Revenues for the fourth quarter of 2013 were $1.17 billion compared to $1.08 billion in the third quarter of 2013 and $966 million in the fourth quarter of 2012.

Net income for the full year 2013 totaled $783 million, or $3.05 per diluted share, on revenues of $4.2 billion, compared to net income of $522 million, or $2.05 per diluted share on revenues of $3.5 billion in 2012.

Addressing the Company’s achievements in the fourth quarter of 2013, David W. Williams, Chairman, President and Chief Executive Officer of Noble Corporation stated, “Contract drilling revenues continued to grow during the fourth quarter with full or partial contributions from three new ultra-deepwater drillships and the first of our six JU3000N high-specification jackups. Building on an exceptional quarter and year of execution in the shipyard, we also saw the delivery of two more JU3000N jackups – the Noble Regina Allen in December, followed by the Noble Houston Colbert in early 2014. These fleet additions, along with the remaining six projects, of which five rigs are expected to complete construction in 2014, are redefining our Company, creating a premium fleet of offshore drilling rigs capable of addressing our clients’ most demanding global well construction assignments.”

 

MORE


Another significant achievement during the quarter was the progress made toward our planned divestiture of substantially all of the standard capability assets in our fleet. We cleared two key hurdles that place the Company on track to complete the divestiture by the end of 2014, with receipt of the private letter ruling from the IRS and the filing last quarter of a registration statement relating to the proposed initial public offering of the new company. While there is some level of uncertainty around global offshore activity in 2014, this is not interfering with our plans for the divestiture. The divestiture has always been about the strategic importance to Noble – a step necessary to allow the two fleets to be optimally managed and operated, placing both in a stronger competitive position for future cycles.”

Contract drilling services revenues for the fourth quarter of 2013 of $1.12 billion improved by $84 million, or 8 percent from the third quarter, due primarily to a 9 percent increase in average dayrates to $212,000 compared to $194,600 in the third quarter. Operating days declined slightly during the fourth quarter due in part to an increase in idle and shipyard days, particularly among rigs in the Middle East region, partially offset by the commencement of operations on the ultra-deepwater drillship Noble Bob Douglas and the high-specification jackup Noble Mick O’Brien, and a full quarter of operations from the ultra-deepwater drillships Noble Don Taylor and Noble Globetrotter II, which began operations during the third quarter. The addition of these new rigs contributed to a $74 million increase in contract drilling operating costs in the fourth quarter to $560 million, compared to $486 million in the third quarter. Contract drilling margin for the fourth quarter was 50.2 percent, compared to 53.3 percent in the third quarter.

Net cash from operating activities was $541 million in the fourth quarter 2013 and $1.7 billion for the full year 2013. Capital expenditures in the fourth quarter 2013 totaled $763 million, including $505 million related to the Company’s fleet expansion program. In 2013, capital expenditures amounted to $2.5 billion, including $1.5 billion associated with the fleet expansion program. As of December 31, 2013, approximately $1.9 billion in capital expenditures was required to complete the remaining seven projects in the Company’s newbuild program, comprising two ultra-deepwater drillships and five high-specification jackups. Six of the seven remaining newbuild projects are expected to be delivered from shipyards by the end of 2014, including the jackup Noble Houston Colbert, which was delivered in early-January.

Debt as a percentage of total capitalization at December 31, 2013 was 38.0 percent, up slightly from 37.5 percent at September 30, 2013, while liquidity, defined as cash and cash equivalents plus availability under revolving credit facilities, totaled $1.45 billion compared to $1.77 billion at September 30, 2013.


Operating Highlights

Total contract backlog at December 31, 2013 was approximately $15.4 billion compared to $16.2 billion at September 30, 2013. The decline from the third quarter was due in part to a change in the bonus realization assumptions relating to contracts with Petrobras and Shell. The new bonus assumptions reflect the Company’s recent history of bonus realization, more stringent regulatory requirements, especially in the U.S. Gulf of Mexico, and changing customer expectations.

During the fourth quarter of 2013, utilization of the Company’s floating rig fleet (semisubmersibles and drillships) was 84 percent compared to 79 percent in the third quarter. Excluding the impact of two cold stacked floaters, utilization in the fourth quarter would have been 91 percent compared to 86 percent in the third quarter. The increase for the quarter primarily relates to the return to service of the semisubmersible Noble Homer Ferrington, which spent the majority of the quarter operating under a short-term contract in the Eastern Mediterranean following an idle period, and the drillship Noble Roger Eason, which in December returned to work offshore Brazil following the completion of a shipyard program. Average daily revenues in the floating rig fleet were $378,400 in the fourth quarter, or an improvement of approximately 3 percent from $369,100 in the third quarter, reflecting the commencement of operations on the ultra-deepwater drillship Noble Bob Douglas and a full quarter of operations on the Noble Don Taylor and the Noble Globetrotter II.

Fourth quarter 2013 utilization of the Company’s jackup rig fleet was 86 percent compared to 94 percent in the third quarter. The decrease primarily relates to fewer operating days on the Noble Roy Rhodes, the Noble Roger Lewis, the Noble David Tinsley and the Noble Gene Rosser which is expected to be sold during the first quarter of 2014. The decrease in utilization was partially offset by a 3 percent improvement in average daily revenues during the quarter to $115,700 from $112,400 during the third quarter.

At the end of the fourth quarter of 2013, approximately 73 percent of the Company’s available rig operating days were committed for 2014, including 78 percent of the floating rig days and 75 percent of the jackup rig days. For 2015, an estimated 44 percent of the available rig operating days were committed, including 61 percent and 38 percent of the floating and jackup rig days, respectively. The calculations for committed operating days include available days for two floaters and one jackup, all of which are currently cold stacked.


Outlook

Williams closed by stating, “After the very robust pace of offshore activity over the past four years, our industry may be entering a short and arguably useful pause in the cycle. As was the case in 2013, we entered this year with considerable backlog. That said, although we believe activity in the jackup sector is best defined as a steady state, the reality is that we find ourselves evaluating fewer floating rig contract opportunities today than we did a year ago. We expect to have additional contract opportunities under review as the year progresses, but it is increasingly clear that the first half of 2014 is likely to be characterized by lower rig utilization. The lower utilization is likely to be more pronounced for the floating rigs with limited technical features. Noble’s exposure to a weaker floating rig sector is limited in 2014, with only 22 percent of our operating days available.”

We are confident about the long-term outlook for offshore drilling and remain committed to a capital allocation strategy that promotes disciplined growth with strong returns and strategic appeal while offering the flexibility to consider other actions that promote enhanced shareholder value. In the ultra-deepwater segment, which represents a growing portion of our revenue, we continue to observe a fundamentally sound business. In the face of generally steady crude oil prices, successful exploration programs with over 240 announced deepwater discoveries since 2008, continued geographic expansion and a building backlog of field development projects, the segment is poised to provide exceptional future growth opportunities. Our transformation to a company with a predominately premium asset fleet positions Noble to successfully address the future opportunities in ultra-deepwater and high-specification jackup drilling applications.”

About Noble Corporation

Noble is a leading offshore drilling contractor for the oil and gas industry. Noble performs, through its subsidiaries, contract drilling services with a fleet of 77 offshore drilling units (including two ultra-deepwater drillships and four high-specification jackup drilling rigs currently under construction), located worldwide, including in the U.S. Gulf of Mexico and Alaska, Mexico, Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India, Malaysia and Australia. Noble’s shares are traded on the New York Stock Exchange under the symbol “NE.” Noble Corporation plc is a public limited company registered in England and Wales with company number 08354954 and registered office at Devonshire House, 1 Mayfair Place, London, W1J 8AJ England. Additional information on Noble Corporation is available on the Company’s Web site at http://www.noblecorp.com.


Statements regarding contract backlog, earnings, costs, revenue, rig demand, fleet condition or performance, shareholder value, timing of delivery of newbuilds, contract commitments, dayrates, contract commencements, contract extensions or renewals, letters of intent or award, industry fundamentals, customer relationships and requirements, strategic initiatives, future performance, growth opportunities, market outlook, 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 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, delays in the construction of newbuilds, the actual amount of downtime, factors that reduce applicable dayrates, violations of anti-corruption laws, hurricanes and other weather 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.

Conference Call

Noble also has scheduled a conference call and webcast related to its fourth quarter and full year 2013 results on Thursday, January 23, 2014, at 8:00 a.m. U.S. Central Standard Time. Interested parties are invited to listen to the call by dialing 1-866-461-7129, or internationally 1-706-679-3084, using access code: 88221538, or by asking for the Noble Corporation conference call. Interested parties may also listen over the Internet through a link posted in the Investor Relations section of the Company’s Web site.

A replay of the conference call will be available on Thursday, January 23, 2014, beginning at 12:00 p.m. U.S. Central Standard Time, through Thursday, February 6, 2014, ending at 11:00 p.m. U.S. Central Standard Time. The phone number for the conference call replay is 1-855-859-2056 or, for calls from outside of the U.S., 1-404-537-3406, using access code: 88221538. The replay will also be available on the Company’s Web site following the end of the live call.


For additional information, contact:

 

For Investors:    Jeffrey L. Chastain,
   Vice President – Investor Relations and Corporate Communications,
   Noble Drilling Services Inc., 281-276-6383
For Media:    John S. Breed,
   Director of Investor Relations and Corporate Communications,
   Noble Drilling Services Inc., 281-276-6729


NOBLE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

 

     Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
     2013     2012     2013     2012  

Operating revenues

        

Contract drilling services

   $ 1,124,760      $ 921,603      $ 4,070,070      $ 3,349,362   

Reimbursables

     33,198        21,405        111,874        115,495   

Labor contract drilling services

     9,091        23,352        52,241        81,890   

Other

     —          7        105        265   
  

 

 

   

 

 

   

 

 

   

 

 

 
     1,167,049        966,367        4,234,290        3,547,012   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating costs and expenses

        

Contract drilling services

     560,259        478,841        2,014,217        1,769,428   

Reimbursables

     24,254        17,478        85,548        94,096   

Labor contract drilling services

     6,879        12,721        36,604        46,752   

Depreciation and amortization

     236,966        208,842        879,422        758,621   

General and administrative

     31,802        24,602        117,997        99,990   

Incremental spin-off related costs

     7,260        5,106        17,702        7,196   

Loss on impairment

     40,103        2,039        43,688        20,384   

Gain on disposal of assets, net

     —          —          (35,646     —     

Gain on contract settlements/extinguishments, net

     —          —          (46,800     (33,255
  

 

 

   

 

 

   

 

 

   

 

 

 
     907,523        749,629        3,112,732        2,763,212   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     259,526        216,738        1,121,558        783,800   

Other income (expense)

        

Interest expense, net of amount capitalized

     (31,185     (28,980     (106,300     (85,763

Interest income and other, net

     1,167        662        2,754        5,188   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     229,508        188,420        1,018,012        703,225   

Income tax provision

     (40,600     (53,981     (167,606     (147,088
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     188,908        134,439        850,406        556,137   

Net income attributable to noncontrolling interests

     (14,848     (6,862     (67,709     (33,793
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to Noble Corporation

   $ 174,060      $ 127,577      $ 782,697      $ 522,344   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income per share

        

Basic

   $ 0.68      $ 0.50      $ 3.05      $ 2.05   

Diluted

   $ 0.68      $ 0.50      $ 3.05      $ 2.05   

 

7


NOBLE CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

     December 31,
2013
     December 31,
2012
 

ASSETS

     

Current assets

     

Cash and cash equivalents

   $ 114,458       $ 282,092   

Accounts receivable

     949,069         743,673   

Prepaid expenses and other current assets

     327,408         279,560   
  

 

 

    

 

 

 

Total current assets

     1,390,935         1,305,325   
  

 

 

    

 

 

 

Property and equipment, net

     14,558,090         13,025,972   

Other assets

     268,932         276,477   
  

 

 

    

 

 

 

Total assets

   $ 16,217,957       $ 14,607,774   
  

 

 

    

 

 

 

LIABILITIES AND EQUITY

     

Current liabilities

     

Accounts payable

   $ 347,214       $ 350,147   

Accrued payroll and related costs

     151,161         132,728   

Dividend payable

     128,249         66,369   

Other current liabilities

     425,291         362,205   
  

 

 

    

 

 

 

Total current liabilities

     1,051,915         911,449   
  

 

 

    

 

 

 

Long-term debt

     5,556,251         4,634,375   

Deferred income taxes

     225,455         226,045   

Other liabilities

     334,308         347,615   
  

 

 

    

 

 

 

Total liabilities

     7,167,929         6,119,484   
  

 

 

    

 

 

 

Commitments and contingencies

     

Equity

     

Total shareholders’ equity

     8,322,583         7,723,166   

Noncontrolling interests

     727,445         765,124   
  

 

 

    

 

 

 

Total equity

     9,050,028         8,488,290   
  

 

 

    

 

 

 

Total liabilities and equity

   $ 16,217,957       $ 14,607,774   
  

 

 

    

 

 

 

 

8


NOBLE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

     Twelve Months Ended
December 31,
 
     2013     2012  

Cash flows from operating activities

    

Net income

   $ 850,406      $ 556,137   

Adjustments to reconcile net income to net cash from operating activities:

    

Depreciation and amortization

     879,422        758,621   

Loss on impairment

     43,688        20,384   

Gain on disposal of assets, net

     (35,646     —     

Other changes in operating activities

     (35,553     46,551   
  

 

 

   

 

 

 

Net cash from operating activities

     1,702,317        1,381,693   
  

 

 

   

 

 

 

Cash flows from investing activities

    

New construction

     (1,526,523     (586,746

Other capital expenditures

     (845,903     (947,090

Capitalized interest

     (115,094     (135,975

Proceeds from disposal of assets

     61,000        —     

Other investing activities

     (58,587     (121,077
  

 

 

   

 

 

 

Net cash from investing activities

     (2,485,107     (1,790,888
  

 

 

   

 

 

 

Cash flows from financing activities

    

Net change in borrowings on bank credit facilities

     1,221,333        (635,192

Repayment of long-term debt

     (300,000     —     

Proceeds from issuance of senior notes, net of debt issuance costs

     —          1,186,636   

Contributions from joint venture partners

     —          40,000   

Dividends paid to joint venture partners

     (105,388     —     

Dividends/Par value reduction payments to shareholders

     (194,913     (138,293

Other financing activities

     (5,876     (1,060
  

 

 

   

 

 

 

Net cash from financing activities

     615,156        452,091   
  

 

 

   

 

 

 

Net change in cash and cash equivalents

     (167,634     42,896   

Cash and cash equivalents, beginning of period

     282,092        239,196   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 114,458      $ 282,092   
  

 

 

   

 

 

 

 

9


NOBLE CORPORATION AND SUBSIDIARIES

FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT

(In thousands, except operating statistics)

(Unaudited)

 

     Three Months Ended December 31,      Three Months Ended September 30,  
     2013      2012      2013  
     Contract
Drilling
Services
    Other     Total      Contract
Drilling
Services
    Other      Total      Contract
Drilling
Services
    Other     Total  

Operating revenues

                     

Contract drilling services

   $ 1,124,760      $ —        $ 1,124,760       $ 921,603      $ —         $ 921,603       $ 1,041,118      $ —        $ 1,041,118   

Reimbursables

     31,520        1,678        33,198         21,043        362         21,405         28,840        402        29,242   

Labor contract drilling services

     —          9,091        9,091         —          23,352         23,352         —          8,493        8,493   

Other

     —          —          —           7        —           7         28        —          28   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 
   $ 1,156,280      $ 10,769      $ 1,167,049       $ 942,653      $ 23,714       $ 966,367       $ 1,069,986      $ 8,895      $ 1,078,881   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Operating costs and expenses

                     

Contract drilling services

   $ 560,259      $ —        $ 560,259       $ 478,841      $ —         $ 478,841       $ 485,861      $ —        $ 485,861   

Reimbursables

     23,329        925        24,254         17,127        351         17,478         23,281        390        23,671   

Labor contract drilling services

     —          6,879        6,879         —          12,721         12,721         —          8,127        8,127   

Depreciation and amortization

     233,730        3,236        236,966         205,329        3,513         208,842         219,695        4,016        223,711   

General and administrative

     31,553        249        31,802         24,060        542         24,602         33,346        430        33,776   

Incremental spin-off related costs

     7,201        59        7,260         5,002        104         5,106         2,388        27        2,415   

Loss on impairment

     40,103        —          40,103         —          2,039         2,039         3,585        —          3,585   

Gain on disposal of assets, net

     —          —          —           —          —           —           (35,646     —          (35,646

Gain on contract settlements/extinguishments, net

     —          —          —           —          —           —           (45,000     —          (45,000
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 
   $ 896,175      $ 11,348      $ 907,523       $ 730,359      $ 19,270       $ 749,629       $ 687,510      $ 12,990      $ 700,500   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Operating income

   $ 260,105      $ (579   $ 259,526       $ 212,294      $ 4,444       $ 216,738       $ 382,476      $ (4,095   $ 378,381   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Operating statistics

                     

Jackups:

                     

Average Rig Utilization

     86          89           94    

Operating Days

     3,360             3,520              3,635       

Average Dayrate

   $ 115,749           $ 100,356            $ 112,414       

Semisubmersibles:

                     

Average Rig Utilization

     84          85           79    

Operating Days

     1,076             1,096              1,012       

Average Dayrate

   $ 402,358           $ 360,226            $ 380,048       

Drillships:

                     

Average Rig Utilization

     85          82           79    

Operating Days

     869             679              702       

Average Dayrate

   $ 348,702           $ 255,667            $ 353,278       

FPSO/Submersibles:

                     

Average Rig Utilization

     0          0           0    

Operating Days

     —               —                —         

Average Dayrate

   $ —             $ —              $ —         

Total:

                     

Average Rig Utilization

     82          83           85    

Operating Days

     5,305             5,295              5,349       

Average Dayrate

   $ 212,019           $ 174,065            $ 194,645       

 

10


NOBLE CORPORATION AND SUBSIDIARIES

CALCULATION OF BASIC AND DILUTED NET INCOME PER SHARE

(In thousands, except per share amounts)

(Unaudited)

The following table sets forth the computation of basic and diluted net income per share:

 

     Three months ended
December 31,
    Twelve months ended
December 31,
 
     2013     2012     2013     2012  

Basic

        

Net income attributable to Noble Corporation

   $ 174,060      $ 127,577      $ 782,697      $ 522,344   

Earnings allocated to unvested share-based payment awards

     (2,077     (1,301     (9,271     (5,309
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income to common shareholders—basic

   $ 171,983      $ 126,276      $ 773,426      $ 517,035   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

        

Net income attributable to Noble Corporation

   $ 174,060      $ 127,577      $ 782,697      $ 522,344   

Earnings allocated to unvested share-based payment awards

     (2,075     (1,300     (9,261     (5,302
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income to common shareholders—diluted

   $ 171,985      $ 126,277      $ 773,436      $ 517,042   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding—basic

     253,423        252,722        253,288        252,435   

Incremental shares issuable from assumed exercise of stock options

     238        253        259        356   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding—diluted

     253,661        252,975        253,547        252,791   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average unvested share-based payment awards

     3,061        2,604        3,036        2,592   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per share

        

Basic

   $ 0.68      $ 0.50      $ 3.05      $ 2.05   

Diluted

   $ 0.68      $ 0.50      $ 3.05      $ 2.05   

 

11