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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the year ended December 31, 2018
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OR
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from __________ to __________
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England and Wales
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98-1023315
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Class A ordinary shares, $0.125 par value
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New York Stock Exchange
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Document
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Part of Form 10-K
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Portions of the Proxy Statement for the 2019 Annual General Meeting of Shareholders
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Part III, Items 10-14
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Page
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•
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failure, difficulties and delays in meeting conditions required for closing set forth in the agreement governing the Transaction with Ensco;
|
•
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the potential impact of the announcement or consummation of the Transaction with Ensco on relationships, including with employees, suppliers, customers, competitors, lenders and credit rating agencies;
|
•
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our ability to successfully integrate the operations of the Company and Ensco and to realize synergies and cost savings following the consummation of the Transaction;
|
•
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prices of oil and natural gas and industry expectations about future prices and impacts of regional or global financial or economic downturns;
|
•
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changes in the offshore drilling market, including fluctuations in worldwide rig supply and demand, competition or technology, including as a result of delivery of newbuild drilling units;
|
•
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variable levels of drilling activity and expenditures in the energy industry, whether as a result of actions by OPEC, global capital markets and liquidity, application of alternate energy sources, prices of oil and natural gas or otherwise, which may result in decreased demand and/or cause us to idle or stack, sell or scrap additional rigs;
|
•
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possible termination, suspension, renegotiation or cancellation of drilling contracts (with or without cause) as a result of general and industry economic conditions, distressed financial condition of our customers,
force majeure,
mechanical difficulties, delays, labor disturbances, strikes, performance or other reasons; payment or operational delays by our customers; or restructuring or insolvency of significant customers;
|
•
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changes or delays in actual contract commencement dates, contract option exercises, contract revenue and contract awards;
|
•
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our ability to enter into, and the terms of, future drilling contracts for drilling units whose contracts are expiring and drilling units currently idled or stacked;
|
•
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downtime, lost revenue and other risks associated with drilling operations, operating hazards, or rig relocations and transportation, including rig or equipment failure, collisions, damage and other unplanned repairs, the availability of transport vessels, hazards, self-imposed drilling limitations and other delays due to weather conditions, work stoppages or otherwise, and the availability or high cost of insurance coverage for certain offshore perils or associated removal of wreckage or debris and other losses;
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•
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regulatory, legislative or permitting requirements affecting drilling operations and other compliance obligations in the areas in which we operate;
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•
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tax matters, including our effective tax rates, tax positions, results of audits, tax disputes, changes in tax laws, treaties and regulations, tax assessments and liabilities for taxes;
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•
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our ability to realize the expected benefits of our joint venture with Saudi Aramco, including our ability to fund any required capital contributions, and increased risks of concentrated operations in the Middle East;
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•
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access to spare parts, equipment and personnel to maintain, service and upgrade our fleet;
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•
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potential cost overruns and other risks inherent with repairs, inspections or upgrades of drilling units, unexpected delays in rig and equipment delivery and engineering or design issues, delays in acceptance by our customers, or delays in the dates our drilling units will enter a shipyard, be transported and delivered, enter service or return to service;
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•
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operating hazards, including environmental or other liabilities, risks, expenses or losses, related to well-control issues, collisions, groundings, blowouts, fires, explosions, weather or hurricane delays or damage, losses or liabilities (including wreckage or debris removal) or otherwise;
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•
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our ability to retain highly skilled personnel on commercially reasonable terms, whether due to competition, cost cutting initiatives, labor regulations, unionization or otherwise; our ability to seek and receive visas for our personnel to work in our areas of operation in a timely manner;
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•
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governmental action and political and economic uncertainties, including uncertainty or instability resulting from civil unrest, military or political demonstrations, acts of war, strikes, terrorism, piracy or outbreak or escalation of hostilities or other crises, which may result in expropriation, nationalization, confiscation, damage or deprivation of assets, extended business interruptions, suspended operations, or suspension and/or termination of contracts and payment disputes based on
force majeure
events;
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•
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cyber-breaches of our corporate or offshore control networks;
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•
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epidemics or other related travel restrictions which may result in business interruptions or shortages of available labor;
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•
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the outcome of legal proceedings, or other claims or contract disputes, including inability to collect receivables or resolve significant contractual or day rate disputes, any renegotiation, nullification, cancellation or breach of contracts with customers or other parties;
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•
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potential for asset impairments;
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•
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our liquidity, adequacy of cash flows to meet obligations, or our ability to access or obtain financing and other sources of capital, such as in the debt or equity capital markets;
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•
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volatility in currency exchange rates and limitations on our ability to use or convert illiquid currencies;
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•
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effects of accounting changes and adoption of accounting policies;
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•
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potential unplanned expenditures and funding requirements, including investments in pension plans and other benefit plans;
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•
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system implementations and upgrades;
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•
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economic volatility and political, legal and tax uncertainties following the June 23, 2016, vote in the U.K. to exit from the European Union ("Brexit") and any subsequent referendum in Scotland to seek independence from the U.K.;
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•
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other important factors described from time to time in the reports filed by us with the SEC and the NYSE.
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Abbreviation/Acronym
|
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Definition
|
2017 Notes
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The Company's 5% Senior Notes due 2017
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2019 Notes
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The Company's 7.875% Senior Notes due 2019
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2022 Notes
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The Company's 4.875% Senior Notes due 2022
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2024 Notes
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The Company's 4.75% Senior Notes due 2024
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2025 Notes
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The Company's 7.375% Senior Notes due 2025
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2042 Notes
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The Company's 5.4% Senior Notes due 2042
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2044 Notes
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The Company's 5.85% Senior Notes due 2044
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ARO
|
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Saudi Aramco Rowan Offshore Drilling Company
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ASC
|
|
Accounting Standards Codification
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ASU
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|
Accounting Standards Update
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Board
|
|
Board of directors of the Company
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Company
|
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Rowan Companies plc together with its wholly-owned subsidiaries
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BSEE
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|
U.S. Bureau of Safety and Environmental Enforcement
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Cobalt
|
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Cobalt International Energy, L.P.
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Company Compensation Committee
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Compensation committee of the board of directors of the Company
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Directors RSUs
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Directors Deferred Restricted Share Units
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Directors ND RSUs
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Directors Non-Deferred Restricted Share Units
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E.U.
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European Union
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EBT
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Employee benefit trust of the Company
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Ensco
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Ensco plc, a public limited company organized under the laws of England and Wales
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Exchange Act
|
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Securities Exchange Act of 1934
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Existing Credit Agreement
|
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The Company's amended and restated senior unsecured revolving credit agreement entered into with a group of lenders on May 22, 2018, which matures January 23, 2021
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Existing Credit Facility
|
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Commitments in the amount of $310.7 million provided by a group of lenders under the Existing Credit Agreement
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FASB
|
|
Financial Accounting Standards Board
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FCPA
|
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U.S. Foreign Corrupt Practices Act
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FCX
|
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Freeport-McMoRan Inc.
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FMOG
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Freeport-McMoRan Oil and Gas LLC
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HPHT
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High-pressure/high-temperature
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IMO
|
|
International Maritime Organization
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IRS
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|
U.S. Internal Revenue Service
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MARPOL 73/78
|
|
International Convention for the Prevention of Pollution from Ships, 1973 as modified by the Protocol of 1978
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NOLs
|
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Net Operating Loss Carryforwards
|
New Credit Agreement
|
|
The Company's senior unsecured revolving credit agreement entered into with a group of lenders on May 22, 2018, which matures May 22, 2023
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New Credit Facility
|
|
Commitments in the amount of $955 million provided by a group of lenders under the New Credit Agreement
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NYSE
|
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The New York Stock Exchange
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OPEC
|
|
Organization of Petroleum Exporting Countries
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P-Units
|
|
Performance Units
|
Plan
|
|
Amended and Restated 2013 Rowan Companies plc Incentive Plan, dated May 25, 2017
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Abbreviation/Acronym
|
|
Definition
|
RCI
|
|
Rowan Companies Inc., a subsidiary of the Company
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Retiree Medical Plan
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Retiree Life & Medical Supplemental Plan of Rowan Companies, Inc.
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Rowan plc
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|
Rowan Companies plc
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Rowan SERP
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Restoration Plan of Rowan Companies, Inc.
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RSAs
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|
Restricted Share Awards
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RSUs
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|
Restricted Share Units
|
SARs
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|
Share Appreciation Rights
|
Saudi Aramco
|
|
Saudi Arabian Oil Company
|
SEC
|
|
The United States Securities and Exchange Commission
|
SEMS
|
|
Safety and environmental management system
|
Senior Notes
|
|
The 2019 Notes, 2022 Notes, 2024 Notes, 2025 Notes, 2042 Notes and 2044 Notes, collectively
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Subject Notes
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The 2017 Notes, 2019 Notes, 2022 Notes and the 2024 Notes, collectively
|
Transaction
|
|
The transactions contemplated by the Transaction Agreement, pursuant to which each of the issued and outstanding Class A ordinary shares of the Company will be exchanged for 2.750 Class A ordinary shares of Ensco pursuant to a court-sanctioned scheme of arrangement under Part 26 of the U.K. Companies Act 2006
|
Transaction Agreement
|
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The agreement, dated October 7, 2018, by and between the Company and Ensco, pursuant to which the Company and Ensco will effect a "merger-of-equals" transaction
|
TSR
|
|
Total Shareholder Return
|
U.K.
|
|
United Kingdom
|
U.S.
|
|
United States
|
U.S. Tax Act
|
|
2017 Tax Cuts and Jobs Act
|
UK Bribery Act
|
|
U.K. Bribery Act 2010
|
US GAAP
|
|
Accounting principles generally accepted in the United States of America
|
US GOM
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|
United States Gulf of Mexico
|
USD
|
|
U.S. Dollar
|
WTI
|
|
West Texas Intermediate
|
•
|
Four
ultra-deepwater drillships;
|
•
|
Fifteen
high-specification jack-up rigs; and
|
•
|
Six
premium jack-up rigs.
|
•
|
worldwide demand for and prices of oil and natural gas, and expectations regarding future energy prices;
|
•
|
the supply of drilling units in the worldwide fleet versus demand;
|
•
|
the level of exploration and development expenditures by energy companies and their ability to raise capital;
|
•
|
the willingness and ability of the OPEC to limit production levels and influence prices;
|
•
|
the level of production in non-OPEC countries;
|
•
|
the effect of economic sanctions that affect the energy industry;
|
•
|
the general economy, including inflation, interest rates and changes in the rate of economic growth;
|
•
|
the condition of global capital markets;
|
•
|
adverse sea, weather and climate conditions in our principal operating areas, including possible disruption of exploration and development activities due to loop currents, hurricanes and other severe sea and weather conditions;
|
•
|
the cost of exploring for, developing, producing and delivering oil and natural gas;
|
•
|
environmental and other laws and regulations;
|
•
|
policies of various governments regarding exploration and development of oil and natural gas reserves;
|
•
|
nationalization of assets or workforce and/or confiscation of assets;
|
•
|
worldwide tax policies and treaties;
|
•
|
political and military conflicts in oil-producing areas and the effects of terrorism;
|
•
|
increased supply of oil and gas from onshore development and relative cost of offshore drilling versus onshore oil and gas production;
|
•
|
the development and exploitation of alternative fuels and energy sources including the growing demand, often government-mandated, for electric powered vehicles; and
|
•
|
merger, divestiture, restructuring and consolidation of our customers and competitors and their assets.
|
•
|
serious damage to or destruction of property and equipment;
|
•
|
personal injury or death;
|
•
|
costly delays or cancellations of drilling operations;
|
•
|
interruption or cessation of day rate revenue;
|
•
|
uncompensated downtime;
|
•
|
reduced day rates;
|
•
|
significant impairment of producing wells, leased properties, pipelines or underground geological formations;
|
•
|
damage to fisheries and pollution of the marine and coastal environment; and
|
•
|
fines and penalties.
|
•
|
Restrict our ability to access credit and debt capital markets;
|
•
|
Cause us to refinance or issue debt with less favorable terms and conditions;
|
•
|
Negatively impact current and prospective customers’ willingness to transact business with us;
|
•
|
Impose additional insurance, guarantee and collateral requirements; or
|
•
|
Limit our access to bank and third-party guarantees, surety bonds and letters of credit.
|
•
|
adverse impact on macroeconomic growth and oil and gas demand;
|
•
|
continued volatility in currencies including the British pound and USD that may impact our financial results;
|
•
|
reduced demand for our services in the U.K. and globally;
|
•
|
increased costs of doing business in the U.K. and in the North Sea;
|
•
|
uncertain impact of regulatory changes arising from an exit from the E.U.;
|
•
|
increased regulatory costs and challenges for operating our business in the North Sea;
|
•
|
volatile capital and debt markets, and access to other sources of capital;
|
•
|
risks related to our global tax structure and the tax treaties upon which we rely;
|
•
|
business uncertainty resulting from prolonged political negotiations; and
|
•
|
uncertain stability of the E.U. and global economy if other countries exit the E.U.
|
•
|
certain damages for which we may be liable to Ensco under the terms and conditions of the Transaction Agreement;
|
•
|
negative reactions from the financial markets, including declines in the price of our shares due to the fact that current prices may reflect a market assumption that the Transaction will be completed;
|
•
|
certain significant costs relating to the Transaction, including, in certain circumstances, the payment by us of
$15 million
for Ensco’s expenses and a termination fee payable by us of
$24 million
less any previous expense reimbursements; and
|
•
|
diverted attention of our management to the Transaction rather than our own operations and pursuit of other opportunities that could have been beneficial to us.
|
|
|
Depth (feet)
|
|
|
|
Rig Name/Type
|
Class Name
|
Water
(6)
|
Drilling
(7)
|
Year of Shipyard Delivery
|
Location
|
|
|
|
|
|
|
Ultra-Deepwater Drillships:
|
|
|
|
|
|
Rowan Renaissance
|
Gusto MSC P10,000
|
12,000
|
40,000
|
2014
|
Mexico
|
Rowan Resolute
|
Gusto MSC P10,000
|
12,000
|
40,000
|
2014
|
US GOM
|
Rowan Reliance
|
Gusto MSC P10,000
|
12,000
|
40,000
|
2014
|
US GOM
|
Rowan Relentless
|
Gusto MSC P10,000
|
12,000
|
40,000
|
2015
|
US GOM
|
|
|
|
|
|
|
Jack-ups:
|
|
|
|
|
|
Rowan Norway
(1)
|
N-Class
|
400
|
35,000
|
2011
|
Turkey
|
Rowan Stavanger
(1)
|
N-Class
|
400
|
35,000
|
2011
|
Norway
|
Rowan Viking
(1)
|
N-Class
|
435
|
35,000
|
2010
|
Norway
|
Bob Palmer
(1) (5)
|
Super Gorilla XL
|
475
|
35,000
|
2003
|
Saudi Arabia
|
Rowan Gorilla VII
(1)
|
Super Gorilla
|
400
|
35,000
|
2001
|
U.K.
|
Rowan Gorilla VI
(1)
|
Super Gorilla
|
400
|
35,000
|
2000
|
Trinidad
|
Rowan Gorilla V
(1)
|
Super Gorilla
|
400
|
35,000
|
1998
|
U.K.
|
Joe Douglas
(1)
|
240C
|
350
|
35,000
|
2012
|
Trinidad
|
Ralph Coffman
(1)
|
240C
|
350
|
35,000
|
2009
|
US GOM
|
Rowan Mississippi
(1) (5)
|
240C
|
375
|
35,000
|
2008
|
Saudi Arabia
|
Rowan EXL IV
(1) (5)
|
EXL
|
320
|
35,000
|
2011
|
Saudi Arabia
|
Rowan EXL III
(1)
|
EXL
|
350
|
35,000
|
2010
|
US GOM
|
Rowan EXL II
(1)
|
EXL
|
350
|
35,000
|
2010
|
Trinidad
|
Rowan EXL I
(1) (5)
|
EXL
|
350
|
35,000
|
2010
|
Saudi Arabia
|
Bess Brants
(2) (4) (5)
|
Super 116E
|
350
|
30,000
|
2013
|
Bahrain
|
Earnest Dees
(2) (4) (5)
|
Super 116E
|
350
|
30,000
|
2013
|
Bahrain
|
Rowan California
(2)(3)
|
116C
|
300
|
25,000
|
1983
|
Bahrain
|
Arch Rowan
(2) (5)
|
116C
|
300
|
25,000
|
1981
|
Saudi Arabia
|
Charles Rowan
(2) (5)
|
116C
|
300
|
25,000
|
1981
|
Saudi Arabia
|
Rowan Middletown
(2) (5)
|
116C
|
300
|
25,000
|
1980
|
Saudi Arabia
|
Rowan Gorilla IV
(1) (3)
|
Gorilla
|
450
|
30,000
|
1986
|
US GOM
|
|
|
12/31/2013
|
|
12/31/2014
|
|
12/31/2015
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2018
|
||||||
Rowan
|
|
100.00
|
|
|
66.67
|
|
|
49.42
|
|
|
55.08
|
|
|
45.66
|
|
|
24.46
|
|
S&P 500 Index
|
|
100.00
|
|
|
113.69
|
|
|
115.26
|
|
|
129.05
|
|
|
157.22
|
|
|
150.33
|
|
Dow Jones US Oil Equipment & Services Index
|
|
100.00
|
|
|
82.78
|
|
|
64.17
|
|
|
81.70
|
|
|
68.05
|
|
|
39.22
|
|
Month ended
|
|
Total number of shares purchased
(1)
|
|
Average price paid per share
(1)
|
|
Total number of shares purchased as part of publicly announced plans or programs
(2)
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs
(2)
|
||||||
October 1 - 31, 2018
|
|
348
|
|
|
$
|
18.68
|
|
|
—
|
|
|
$
|
—
|
|
November 1 - 30, 2018
|
|
37
|
|
|
$
|
16.05
|
|
|
—
|
|
|
$
|
—
|
|
December 1 - 31, 2018
|
|
141,443
|
|
|
$
|
8.97
|
|
|
—
|
|
|
$
|
—
|
|
Total
|
|
141,828
|
|
|
$
|
8.99
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(1) The total number of shares acquired includes shares acquired from employees by an affiliated EBT in satisfaction of tax withholding requirements. The price paid for shares acquired in satisfaction of withholding taxes is the share price on the date of the transaction. There were no shares repurchased under any share repurchase program during the fourth quarter of 2018.
|
||||||||||||||
(2) The ability to make share repurchases is subject to the discretion of our Board and the limitations set forth in the U.K. Companies Act of 2006, which generally provides that share repurchases may only be made out of distributable reserves. At our 2018 general meeting of shareholders on May 24, 2018, our shareholders approved new repurchase agreements and counterparties, which approval will remain valid until May of 2023. Our Board has authority to commence or suspend share repurchase programs from time to time without prior notice pursuant to these approved repurchase agreements. There are no share repurchase programs outstanding at December 31, 2018.
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(Dollars in millions, except per share amounts)
|
||||||||||||||||||
Operations
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
824.8
|
|
|
$
|
1,282.8
|
|
|
$
|
1,843.2
|
|
|
$
|
2,137.0
|
|
|
$
|
1,824.4
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct operating costs (excluding items shown below)
|
682.7
|
|
|
685.0
|
|
|
779.7
|
|
|
980.2
|
|
|
982.8
|
|
|||||
Depreciation and amortization
|
388.9
|
|
|
403.7
|
|
|
402.9
|
|
|
391.4
|
|
|
322.6
|
|
|||||
Selling, general and administrative
|
96.1
|
|
|
104.6
|
|
|
102.2
|
|
|
114.3
|
|
|
125.1
|
|
|||||
Gain on sale of assets to unconsolidated subsidiary
(1)
|
(65.8
|
)
|
|
(157.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
(Gain) loss on disposals of property and equipment
|
12.1
|
|
|
9.4
|
|
|
8.7
|
|
|
(7.7
|
)
|
|
(1.7
|
)
|
|||||
Gain on litigation settlement
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20.9
|
)
|
|||||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Material charges and other operating items
(3)
|
—
|
|
|
—
|
|
|
32.9
|
|
|
337.3
|
|
|
574.0
|
|
|||||
Total costs and expenses
|
1,122.9
|
|
|
1,045.3
|
|
|
1,326.4
|
|
|
1,815.5
|
|
|
1,981.9
|
|
|||||
Equity in earnings of unconsolidated subsidiary
|
10.3
|
|
|
0.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income (loss) from operations
|
(287.8
|
)
|
|
238.4
|
|
|
516.8
|
|
|
321.5
|
|
|
(157.5
|
)
|
|||||
Other (expense) — net
(4)
|
(111.2
|
)
|
|
(139.1
|
)
|
|
(191.2
|
)
|
|
(163.8
|
)
|
|
(112.1
|
)
|
|||||
Income (loss) from continuing operations before income taxes
|
(399.0
|
)
|
|
99.3
|
|
|
325.6
|
|
|
157.7
|
|
|
(269.6
|
)
|
|||||
Provision (benefit) for income taxes
|
(51.6
|
)
|
|
26.6
|
|
|
5.0
|
|
|
64.4
|
|
|
(150.7
|
)
|
|||||
Income (loss) from continuing operations
|
(347.4
|
)
|
|
72.7
|
|
|
320.6
|
|
|
93.3
|
|
|
(118.9
|
)
|
|||||
Discontinued operations, net of taxes
(5)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.0
|
|
|||||
Net income (loss)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
320.6
|
|
|
$
|
93.3
|
|
|
$
|
(114.9
|
)
|
Basic income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income (loss) from continuing operations
|
$
|
(2.74
|
)
|
|
$
|
0.58
|
|
|
$
|
2.56
|
|
|
$
|
0.75
|
|
|
$
|
(0.96
|
)
|
Income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.03
|
|
|||||
Net income (loss)
|
$
|
(2.74
|
)
|
|
$
|
0.58
|
|
|
$
|
2.56
|
|
|
$
|
0.75
|
|
|
$
|
(0.93
|
)
|
Diluted income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income (loss) from continuing operations
|
$
|
(2.74
|
)
|
|
$
|
0.57
|
|
|
$
|
2.55
|
|
|
$
|
0.75
|
|
|
$
|
(0.96
|
)
|
Income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.03
|
|
|||||
Net income (loss)
|
$
|
(2.74
|
)
|
|
$
|
0.57
|
|
|
$
|
2.55
|
|
|
$
|
0.75
|
|
|
$
|
(0.93
|
)
|
Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
1,026.7
|
|
|
$
|
1,332.1
|
|
|
$
|
1,255.5
|
|
|
$
|
484.2
|
|
|
$
|
339.2
|
|
Property and equipment — net
|
$
|
6,201.0
|
|
|
$
|
6,552.7
|
|
|
$
|
7,060.0
|
|
|
$
|
7,405.8
|
|
|
$
|
7,432.2
|
|
Total assets
|
$
|
8,117.7
|
|
|
$
|
8,458.3
|
|
|
$
|
8,675.6
|
|
|
$
|
8,347.3
|
|
|
$
|
8,392.3
|
|
Current portion of long-term debt
|
$
|
201.2
|
|
|
$
|
—
|
|
|
$
|
126.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt, less current portion
|
$
|
2,309.7
|
|
|
$
|
2,510.3
|
|
|
$
|
2,553.4
|
|
|
$
|
2,692.4
|
|
|
$
|
2,788.5
|
|
Shareholders’ equity
(6)
|
$
|
5,035.0
|
|
|
$
|
5,386.1
|
|
|
$
|
5,113.9
|
|
|
$
|
4,772.5
|
|
|
$
|
4,691.4
|
|
Statistical Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current ratio
(7)
|
2.87
|
|
|
6.06
|
|
|
3.27
|
|
|
2.80
|
|
|
2.82
|
|
|||||
Debt to capitalization ratio
|
33
|
%
|
|
32
|
%
|
|
34
|
%
|
|
36
|
%
|
|
37
|
%
|
|||||
Book value per share of common stock outstanding
|
$
|
39.62
|
|
|
$
|
42.66
|
|
|
$
|
40.76
|
|
|
$
|
38.24
|
|
|
$
|
37.66
|
|
Price range of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
High
|
$
|
20.70
|
|
|
$
|
20.50
|
|
|
$
|
21.68
|
|
|
$
|
25.13
|
|
|
$
|
35.17
|
|
Low
|
$
|
7.97
|
|
|
$
|
9.02
|
|
|
$
|
10.67
|
|
|
$
|
14.63
|
|
|
$
|
19.50
|
|
Cash dividends declared per share
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.40
|
|
|
$
|
0.30
|
|
(1)
|
In 2018 and 2017, the Company recognized a
$65.8 million
and
157.4 million
gain, respectively, on the sale of assets to ARO.
|
(2)
|
Gain on litigation settlement includes: 2014 – a gain of $20.9 million in cash received for damages incurred as a result of a tanker’s collision with the
Rowan EXL I
in 2012
.
|
(3)
|
Material charges and other operating expenses consisted of the following: 2016 – $34.3 million of non-cash impairment charges and a $1.4 million reversal of an estimated liability for settlement of a withholding tax matter during a tax amnesty period which was related to a legal settlement for a 2014 termination of a contract for refurbishment work on the
Rowan Gorilla III
, as noted below in the 2015 period. A payment of such withholding taxes during the tax amnesty period resulted in the waiver of applicable penalties and interest; 2015 – $329.8 million of non-cash asset impairment charges and a $7.6 million
adjustment to an estimated liability for the 2014 termination of a contract for refurbishment work on the
Rowan Gorilla III
. A settlement agreement for this matter was signed during the third quarter of 2015; and 2014 – $574.0 million of non-cash asset impairment charges.
|
(4)
|
In 2016, other income (expense), net includes a $31.2 million loss on debt extinguishment.
|
(5)
|
In 2011, the Company sold its manufacturing and land drilling operations, which were classified as discontinued operations. In 2014, we sold a land rig retained from the sale and recognized a $4.0 million gain, net of tax.
|
(6)
|
2018 includes (i) a $5.5 million increase to Retained earnings related to the adoption of ASU No. 2014-09 and (ii) a $45.6 million increase to Retained earnings as a reclassification from Accumulated other comprehensive income related to the adoption of ASU No. 2018-02. 2017 includes a $206.6 million increase to Retained earnings related to the adoption of ASU No. 2016-16.
|
(7)
|
Current ratio excludes assets and liabilities of discontinued operations.
|
|
February 13, 2019
|
||||||||||
|
Jack-ups
(1) (2)
|
|
Deepwater
|
|
Total
|
||||||
US GOM
|
$
|
11.7
|
|
|
$
|
79.9
|
|
|
$
|
91.6
|
|
Mexico
|
—
|
|
|
18.3
|
|
|
18.3
|
|
|||
Middle East
(1) (2)
|
265.5
|
|
|
—
|
|
|
265.5
|
|
|||
North Sea
|
184.1
|
|
|
—
|
|
|
184.1
|
|
|||
Mediterranean Sea
|
10.8
|
|
|
—
|
|
|
10.8
|
|
|||
Central and South America
|
64.6
|
|
|
—
|
|
|
64.6
|
|
|||
Total backlog
|
$
|
536.7
|
|
|
$
|
98.2
|
|
|
$
|
634.9
|
|
|
|
|
|
|
|
||||||
(1)
Excludes ARO's revenue backlog.
|
|||||||||||
(2)
The total estimated revenue backlog includes $265.5 million of estimated bareboat charter and lease related revenue for nine jack-ups leased to ARO to fulfill contracts between ARO and Saudi Aramco. Substantially all the operating costs for jack-ups leased to ARO through bareboat charter agreements will be borne by ARO.
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue (in millions):
|
|
|
|
|
|
||||||
Deepwater
|
|
|
|
|
|
||||||
Day rate revenue
|
$
|
155.4
|
|
|
$
|
465.7
|
|
|
$
|
824.7
|
|
Rebillable revenue
(1)
|
2.7
|
|
|
2.2
|
|
|
2.8
|
|
|||
Total Deepwater
|
$
|
158.1
|
|
|
$
|
467.9
|
|
|
$
|
827.5
|
|
|
|
|
|
|
|
||||||
Jack-ups
|
|
|
|
|
|
||||||
Day rate revenue
(2)
|
$
|
556.1
|
|
|
$
|
784.7
|
|
|
$
|
994.7
|
|
Secondment revenue
(1)
|
55.9
|
|
|
9.2
|
|
|
—
|
|
|||
Rebillable revenue
(1)
|
15.0
|
|
|
12.0
|
|
|
18.1
|
|
|||
Miscellaneous revenue
(1)
|
5.9
|
|
|
1.6
|
|
|
2.9
|
|
|||
Total Jack-ups
|
$
|
632.9
|
|
|
$
|
807.5
|
|
|
$
|
1,015.7
|
|
|
|
|
|
|
|
||||||
Unallocated
|
|
|
|
|
|
||||||
Transition services revenue
(1)
|
$
|
33.8
|
|
|
$
|
7.4
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Total revenue
|
$
|
824.8
|
|
|
$
|
1,282.8
|
|
|
$
|
1,843.2
|
|
|
|
|
|
|
|
||||||
Revenue-producing days:
|
|
|
|
|
|
||||||
Deepwater
(3)
|
442
|
|
|
783
|
|
|
1,238
|
|
|||
Jack-ups
(4)
|
4,844
|
|
|
6,144
|
|
|
5,999
|
|
|||
Total revenue-producing days
(3) (4)
|
5,286
|
|
|
6,927
|
|
|
7,237
|
|
|||
|
|
|
|
|
|
||||||
Available days:
(5)
|
|
|
|
|
|
|
|
||||
Deepwater
|
1,460
|
|
|
1,460
|
|
|
1,464
|
|
|||
Jack-ups
|
6,751
|
|
|
8,162
|
|
|
8,784
|
|
|||
Total available days
|
8,211
|
|
|
9,622
|
|
|
10,248
|
|
|||
|
|
|
|
|
|
||||||
Average day rate (in thousands):
(6)
|
|
|
|
|
|
|
|
|
|||
Deepwater
(3) (7) (8)
|
$
|
351.2
|
|
|
$
|
594.8
|
|
|
$
|
550.7
|
|
Jack-ups
|
$
|
114.8
|
|
|
$
|
127.7
|
|
|
$
|
165.8
|
|
Total fleet
(3) (7) (8)
|
$
|
134.6
|
|
|
$
|
180.5
|
|
|
$
|
231.7
|
|
|
|
|
|
|
|
||||||
Utilization:
(9)
|
|
|
|
|
|
||||||
Deepwater
(3)
|
30
|
%
|
|
54
|
%
|
|
85
|
%
|
|||
Jack-ups
|
72
|
%
|
|
75
|
%
|
|
68
|
%
|
|||
Total fleet
(3)
|
64
|
%
|
|
72
|
%
|
|
71
|
%
|
|||
|
|
|
|
|
|
||||||
(1)
Rebillable, secondment, miscellaneous and transition services revenue are excluded from the computation of average day rate.
|
|||||||||||
(2)
Dayrate revenue includes Bareboat Charter lease and related revenue from ARO of $24.4 million for the year ended December 31, 2018.
|
|||||||||||
(3)
Revenue-producing days for the year ended December 31, 2017, includes 125 days for the Deepwater drillship Rowan Reliance when it was not operating. The drillship did not operate in the third and fourth quarter of 2017, but was available for Cobalt through November 2, 2017, per the 2016 contract amendment (See
Note 1
of the "Consolidated Financial Statements" in Part II, Item 8 of this Annual Report). Revenue of $70 million, previously deferred in 2016, was recognized during the year ended December 31, 2017, related to these days for which the rig was available to Cobalt but was not operating as well as the recognition of any remaining deferred revenue at November 2, 2017, as Cobalt did not exercise their right to use the rig.
|
|||||||||||
(4)
For rigs leased to ARO, revenue-producing days includes the number of days on hire under Bareboat Charter lease to ARO.
|
(5)
Available days are defined as the aggregate number of calendar days (excluding days for which a rig is cold-stacked) in the period, or, with respect to new rigs entering service, the number of calendar days in the period from the date the rig was placed in service. In the case of rigs leased to ARO, the number of available days is based on the number of days available for hire under the Bareboat Charter lease to ARO.
|
|||||||||||
(6)
Average day rate is computed by dividing day rate revenue by the number of revenue-producing days, including fractional days. Day rate revenue includes the contractual rates, Bareboat Charter lease revenue from ARO and amounts received, such as for rig mobilization, unconstrained demobilization or capital improvements, which are amortized over the expected recognition period of the contract. Revenue attributable to reimbursable expenses is excluded from average day rates.
|
|||||||||||
(7)
For the year ended December 31, 2018, revenue for this calculation includes $27.8 million related to the Anadarko early contract termination fee to which there are no associated revenue-producing days.
|
|||||||||||
(8)
Average day rate for 2016 includes operating days for the
Rowan Relentless
up to the contract termination, which was 143 days for 2016.
|
|||||||||||
(9)
Utilization is the number of revenue-producing days, including fractional days, divided by the number of available days. For rigs leased to ARO, utilization includes the number of days on hire under Bareboat Charter to ARO divided by the number of available days.
|
|||||||||||
(10)
All revenue and KPIs exclude the results from rigs owned by ARO beginning on October 17, 2017, and October 1, 2018, the dates such rigs were sold to ARO.
|
|
Years ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Deepwater:
|
|
|
|
|
|
|||
Idle
(1)
|
67.5
|
%
|
|
46.4
|
%
|
|
15.2
|
%
|
Out-of-service
(2)
|
1.4
|
%
|
|
—
|
%
|
|
0.1
|
%
|
Operational downtime
(3)
|
2.6
|
%
|
|
—
|
%
|
|
0.1
|
%
|
|
|
|
|
|
|
|||
Jack-up:
|
|
|
|
|
|
|||
Idle
(1)
|
16.1
|
%
|
|
15.7
|
%
|
|
25.4
|
%
|
Out-of-service
(2)
|
11.0
|
%
|
|
8.1
|
%
|
|
5.3
|
%
|
Operational downtime
(3)
|
1.6
|
%
|
|
1.3
|
%
|
|
1.4
|
%
|
|
|
|
|
|
|
|||
(1)
Idle Days – Days a rig is not under contract and is available to work. Idle days exclude cold-stacked rigs, which are not marketed.
|
||||||||
(2)
Out-of-Service Days – Those days when a rig is (or is planned to be) out of service and is not able to earn revenue. The Company may be compensated for certain out-of-service days, such as for shipyard stays or for rig transit periods preceding a contract; however, recognition of any such compensation is deferred and recognized over the expected recognition period for the drilling contract.
|
||||||||
(3)
Operational Downtime – Unbillable time when a rig is under contract and unable to conduct planned operations due to equipment breakdowns or procedural failures.
|
||||||||
(4)
All revenue and utilization metrics exclude the results from rigs owned by ARO beginning on October 17, 2017, and October 1, 2018, the dates such rigs were sold to ARO.
|
|
Year ended December 31,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change
|
|
% Change
|
|||||||
Deepwater:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
158.1
|
|
|
$
|
467.9
|
|
|
$
|
(309.8
|
)
|
|
(66
|
)%
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
168.6
|
|
|
151.4
|
|
|
17.2
|
|
|
11
|
%
|
|||
Depreciation and amortization
|
108.5
|
|
|
111.6
|
|
|
(3.1
|
)
|
|
(3
|
)%
|
|||
Other operating items - expense
|
1.6
|
|
|
0.1
|
|
|
1.5
|
|
|
n/m
|
|
|||
Income (loss) from operations
|
$
|
(120.6
|
)
|
|
$
|
204.8
|
|
|
$
|
(325.4
|
)
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|||||||
Jack-ups:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
632.9
|
|
|
$
|
807.5
|
|
|
$
|
(174.6
|
)
|
|
(22
|
)%
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
514.1
|
|
|
533.6
|
|
|
(19.5
|
)
|
|
(4
|
)%
|
|||
Depreciation and amortization
|
278.3
|
|
|
289.4
|
|
|
(11.1
|
)
|
|
(4
|
)%
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(65.8
|
)
|
|
(157.4
|
)
|
|
91.6
|
|
|
n/m
|
|
|||
Other operating items - expense
|
5.3
|
|
|
9.3
|
|
|
(4.0
|
)
|
|
n/m
|
|
|||
Income (loss) from operations
|
$
|
(99.0
|
)
|
|
$
|
132.6
|
|
|
$
|
(231.6
|
)
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|||||||
ARO:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
348.8
|
|
|
$
|
48.6
|
|
|
$
|
300.2
|
|
|
n/m
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
194.0
|
|
|
22.2
|
|
|
171.8
|
|
|
n/m
|
|
|||
Depreciation and amortization
|
67.4
|
|
|
12.9
|
|
|
54.5
|
|
|
n/m
|
|
|||
Selling, general and administrative
|
27.0
|
|
|
6.1
|
|
|
20.9
|
|
|
n/m
|
|
|||
Other operating items - (income) expense
|
1.4
|
|
|
(0.1
|
)
|
|
1.5
|
|
|
n/m
|
|
|||
Income from operations
|
$
|
59.0
|
|
|
$
|
7.5
|
|
|
$
|
51.5
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|||||||
Unallocated and other:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
33.8
|
|
|
$
|
7.4
|
|
|
$
|
26.4
|
|
|
n/m
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Depreciation and amortization
|
2.1
|
|
|
2.7
|
|
|
(0.6
|
)
|
|
(22
|
)%
|
|||
Selling, general and administrative
|
96.1
|
|
|
104.6
|
|
|
(8.5
|
)
|
|
(8
|
)%
|
|||
Other operating items - expense
|
5.2
|
|
|
—
|
|
|
5.2
|
|
|
n/m
|
|
|||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
8.9
|
|
|
n/m
|
|
|||
Loss from operations
|
$
|
(78.5
|
)
|
|
$
|
(99.9
|
)
|
|
$
|
21.4
|
|
|
(21
|
)%
|
|
|
|
|
|
|
|
|
|||||||
“n/m” - not meaningful.
|
|
|
|
|
|
|
|
|
Year ended December 31,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change
|
|
% Change
|
|||||||
Reportable segments total:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
1,173.6
|
|
|
$
|
1,331.4
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
876.7
|
|
|
707.2
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
456.3
|
|
|
416.6
|
|
|
|
|
|
|
|
|||
Selling, general and administrative
|
123.1
|
|
|
110.7
|
|
|
|
|
|
|
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(65.8
|
)
|
|
(157.4
|
)
|
|
|
|
|
|
|
|||
Other operating items - expense
|
13.5
|
|
|
9.3
|
|
|
|
|
|
|
|
|||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
|
|
|
|||||
Income (loss) from operations
|
$
|
(239.1
|
)
|
|
$
|
245.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Eliminations and adjustments:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
(348.8
|
)
|
|
$
|
(48.6
|
)
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
(194.0
|
)
|
|
(22.2
|
)
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
(67.4
|
)
|
|
(12.9
|
)
|
|
|
|
|
|
|
|||
Selling, general and administrative
|
(27.0
|
)
|
|
(6.1
|
)
|
|
|
|
|
|
||||
Other operating items - income (expense)
|
(1.4
|
)
|
|
0.1
|
|
|
|
|
|
|
||||
Equity in earnings of unconsolidated subsidiary
|
10.3
|
|
|
0.9
|
|
|
|
|
|
|
||||
Loss from operations
|
$
|
(48.7
|
)
|
|
$
|
(6.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total company:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
824.8
|
|
|
$
|
1,282.8
|
|
|
$
|
(458.0
|
)
|
|
(36
|
)%
|
Direct operating costs (excluding items below)
|
682.7
|
|
|
685.0
|
|
|
(2.3
|
)
|
|
—
|
%
|
|||
Depreciation and amortization
|
388.9
|
|
|
403.7
|
|
|
(14.8
|
)
|
|
(4
|
)%
|
|||
Selling, general and administrative
|
96.1
|
|
|
104.6
|
|
|
(8.5
|
)
|
|
(8
|
)%
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(65.8
|
)
|
|
(157.4
|
)
|
|
91.6
|
|
|
n/m
|
|
|||
Other operating items - expense
|
12.1
|
|
|
9.4
|
|
|
2.7
|
|
|
n/m
|
|
|||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
8.9
|
|
|
n/m
|
|
|||
Equity in earnings of unconsolidated subsidiary
|
10.3
|
|
|
0.9
|
|
|
9.4
|
|
|
n/m
|
|
|||
Income (loss) from operations
|
$
|
(287.8
|
)
|
|
$
|
238.4
|
|
|
$
|
(526.2
|
)
|
|
n/m
|
|
Other (expense), net
|
(111.2
|
)
|
|
(139.1
|
)
|
|
27.9
|
|
|
(20
|
)%
|
|||
Income (loss) before income taxes
|
(399.0
|
)
|
|
99.3
|
|
|
(498.3
|
)
|
|
n/m
|
|
|||
Provision (benefit) for income taxes
|
(51.6
|
)
|
|
26.6
|
|
|
(78.2
|
)
|
|
n/m
|
|
|||
Net Income (loss)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
(420.1
|
)
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|||||||
“n/m” - not meaningful.
|
|
|
|
|
|
|
|
|
Increase (decrease)
|
||
Fewer revenue-producing days
|
$
|
(224.6
|
)
|
Lower average drillship day rates
|
(84.9
|
)
|
|
Rowan Reliance acceleration
(1)
|
(28.6
|
)
|
|
Rowan Resolute-
Anadarko early contract termination fee
|
27.8
|
|
|
Higher reimbursable revenue
|
0.5
|
|
|
Decrease
|
$
|
(309.8
|
)
|
|
|
||
(1)
In November 2017 the Company accelerated the recognition of approximately $29 million in previously deferred revenue for the
Rowan Reliance
(to which no operating days were associated) as Cobalt did not exercise their right to use the rig.
|
|
Increase (decrease)
|
||
ARO related - decrease due to sale of assets to ARO
|
$
|
(62.3
|
)
|
ARO related - decrease due to rigs leased to ARO
|
(24.3
|
)
|
|
ARO related - increase to secondment reimbursable costs
|
46.7
|
|
|
ARO related - management fee
|
25.7
|
|
|
Decrease due to idle or cold-stacked rigs
|
(18.9
|
)
|
|
Reduction in shorebase costs and other
|
(18.5
|
)
|
|
Ramp up costs, non-recoverable preparation costs, repairs and maintenance expenses for
Bess Brants
,
Earnest Dees
,
EXL I
and
EXL IV for lease to ARO
|
24.7
|
|
|
Increase in jack-up direct operating expense
|
4.4
|
|
|
Higher reimbursable costs
|
3.0
|
|
|
Decrease
|
$
|
(19.5
|
)
|
•
|
$10.8 million increase in interest income from ARO note receivable primarily due to balances outstanding a full year in 2018 compared to a partial year in 2017, the period from October 17, 2017 to December 31, 2017, (see
Note 4
of the "Consolidated Financial Statements" in Part II, Item 8 of this Annual Report for additional information);
|
•
|
$6.9 million increase in interest income on cash balances due to higher interest rates.
|
•
|
Benefit of
$15.2 million
in 2018 from pension and other postretirement benefit plans net periodic cost, exclusive of service cost compared to an expense of
$0.1 million
in
2017
. The benefit in 2018 was primarily due to a pension plan curtailment gain of $11.4 million in the second quarter of 2018. The 2017 period included a $5.8 million settlement loss related to an annuity purchase.
|
•
|
Increase in net foreign currency exchange losses of
$3.0 million
; and
|
•
|
Gain on the early extinguishment of debt in 2017 of
$1.7 million
.
|
|
Year ended December 31,
|
|
|
|
|
|||||||||
|
2017
|
|
2016
|
|
Change
|
|
% Change
|
|||||||
Deepwater:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
467.9
|
|
|
$
|
827.5
|
|
|
$
|
(359.6
|
)
|
|
(43
|
)%
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
151.4
|
|
|
222.4
|
|
|
(71.0
|
)
|
|
(32
|
)%
|
|||
Depreciation and amortization
|
111.6
|
|
|
115.0
|
|
|
(3.4
|
)
|
|
(3
|
)%
|
|||
Other operating items - expense
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
n/m
|
|
|||
Income from operations
|
$
|
204.8
|
|
|
$
|
490.0
|
|
|
$
|
(285.2
|
)
|
|
(58
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Jack-ups:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
807.5
|
|
|
$
|
1,015.7
|
|
|
$
|
(208.2
|
)
|
|
(20
|
)%
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
533.6
|
|
|
557.3
|
|
|
(23.7
|
)
|
|
(4
|
)%
|
|||
Depreciation and amortization
|
289.4
|
|
|
282.6
|
|
|
6.8
|
|
|
2
|
%
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(157.4
|
)
|
|
—
|
|
|
(157.4
|
)
|
|
n/m
|
|
|||
Other operating items - expense
|
9.3
|
|
|
40.9
|
|
|
(31.6
|
)
|
|
n/m
|
|
|||
Income from operations
|
$
|
132.6
|
|
|
$
|
134.9
|
|
|
$
|
(2.3
|
)
|
|
(2
|
)%
|
|
|
|
|
|
|
|
|
|||||||
ARO:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
48.6
|
|
|
$
|
—
|
|
|
|
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
22.2
|
|
|
—
|
|
|
|
|
|
|||||
Depreciation and amortization
|
12.9
|
|
|
—
|
|
|
|
|
|
|||||
Selling, general and administrative
|
6.1
|
|
|
—
|
|
|
|
|
|
|||||
Other operating items - income
|
(0.1
|
)
|
|
—
|
|
|
|
|
|
|||||
Income from operations
|
$
|
7.5
|
|
|
$
|
—
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Unallocated and other:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
7.4
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
|
n/m
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Depreciation and amortization
|
2.7
|
|
|
5.3
|
|
|
(2.6
|
)
|
|
(49
|
)%
|
|||
Selling, general and administrative
|
104.6
|
|
|
102.2
|
|
|
2.4
|
|
|
2
|
%
|
|||
Other operating items - expense
|
—
|
|
|
0.6
|
|
|
(0.6
|
)
|
|
n/m
|
|
|||
Loss from operations
|
$
|
(99.9
|
)
|
|
$
|
(108.1
|
)
|
|
$
|
8.2
|
|
|
(8
|
)%
|
|
|
|
|
|
|
|
|
|||||||
“n/m” - not meaningful.
|
|
|
|
|
|
|
|
|
Year ended December 31,
|
|
|
|
|
|||||||||
|
2017
|
|
2016
|
|
Change
|
|
% Change
|
|||||||
Reportable segments total:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
1,331.4
|
|
|
$
|
1,843.2
|
|
|
|
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
707.2
|
|
|
779.7
|
|
|
|
|
|
|||||
Depreciation and amortization
|
416.6
|
|
|
402.9
|
|
|
|
|
|
|||||
Selling, general and administrative
|
110.7
|
|
|
102.2
|
|
|
|
|
|
|||||
Gain on sale of assets to unconsolidated subsidiary
|
(157.4
|
)
|
|
—
|
|
|
|
|
|
|||||
Other operating items - expense
|
9.3
|
|
|
41.6
|
|
|
|
|
|
|||||
Income from operations
|
$
|
245.0
|
|
|
$
|
516.8
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Eliminations and adjustments:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
(48.6
|
)
|
|
$
|
—
|
|
|
|
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|||||||
Direct operating costs (excluding items below)
|
(22.2
|
)
|
|
—
|
|
|
|
|
|
|||||
Depreciation and amortization
|
(12.9
|
)
|
|
—
|
|
|
|
|
|
|||||
Selling, general and administrative
|
(6.1
|
)
|
|
—
|
|
|
|
|
|
|||||
Other operating items - income
|
0.1
|
|
|
—
|
|
|
|
|
|
|||||
Equity in earnings of unconsolidated subsidiary
|
0.9
|
|
|
—
|
|
|
|
|
|
|||||
Loss from operations
|
$
|
(6.6
|
)
|
|
$
|
—
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Total company:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
1,282.8
|
|
|
$
|
1,843.2
|
|
|
$
|
(560.4
|
)
|
|
(30
|
)%
|
Direct operating costs (excluding items below)
|
685.0
|
|
|
779.7
|
|
|
(94.7
|
)
|
|
(12
|
)%
|
|||
Depreciation and amortization
|
403.7
|
|
|
402.9
|
|
|
0.8
|
|
|
—
|
%
|
|||
Selling, general and administrative
|
104.6
|
|
|
102.2
|
|
|
2.4
|
|
|
2
|
%
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(157.4
|
)
|
|
—
|
|
|
(157.4
|
)
|
|
n/m
|
|
|||
Other operating items - expense
|
9.4
|
|
|
41.6
|
|
|
(32.2
|
)
|
|
n/m
|
|
|||
Equity in earnings of unconsolidated subsidiary
|
0.9
|
|
|
—
|
|
|
0.9
|
|
|
n/m
|
|
|||
Income from operations
|
$
|
238.4
|
|
|
$
|
516.8
|
|
|
$
|
(278.4
|
)
|
|
(54
|
)%
|
Other (expense), net
|
(139.1
|
)
|
|
(191.2
|
)
|
|
52.1
|
|
|
(27
|
)%
|
|||
Income before income taxes
|
99.3
|
|
|
325.6
|
|
|
(226.3
|
)
|
|
(70
|
)%
|
|||
Provision for income taxes
|
26.6
|
|
|
5.0
|
|
|
21.6
|
|
|
n/m
|
|
|||
Net Income
|
$
|
72.7
|
|
|
$
|
320.6
|
|
|
$
|
(247.9
|
)
|
|
(77
|
)%
|
|
|
|
|
|
|
|
|
|||||||
“n/m” - not meaningful.
|
|
|
|
|
|
|
|
|
Increase (decrease)
|
||
Fewer operating days
|
$
|
(277.1
|
)
|
Prior year Contract Termination for
Rowan Relentless
and related items
|
(142.7
|
)
|
|
Lower reimbursable revenue
|
(0.6
|
)
|
|
Higher drillship day rates
(1)
|
60.8
|
|
|
Decrease
|
$
|
(359.6
|
)
|
|
|||
(1)
Higher average drillship day rates resulted largely from the blend and extend arrangement for the
Rowan Resolute
. In addition, in November 2017 the Company accelerated the recognition of approximately $29 million in previously deferred revenue for the
Rowan Reliance
(to which no operating days were associated) as Cobalt did not exercise their right to use the rig. These increases were partially offset by a decrease for the
Rowan
Reliance
due to lower average day rates in 2017 compared to 2016.
|
|
Increase (decrease)
|
||
Lower jack-up day rates
|
$
|
(244.2
|
)
|
Lower reimbursable revenue
|
(6.1
|
)
|
|
Lower other revenue
|
(1.3
|
)
|
|
Increased operating days
|
46.8
|
|
|
ARO related - decrease due to sale of assets to ARO
|
(12.6
|
)
|
|
ARO related - increase in secondment reimbursables
|
9.2
|
|
|
Decrease
|
$
|
(208.2
|
)
|
|
Decrease
|
||
Decrease due to idle drillships
|
$
|
(44.8
|
)
|
Reduction in shore base costs and other
|
(17.6
|
)
|
|
Reduction in drillship direct operating expenses
|
(8.0
|
)
|
|
Lower reimbursable costs
|
(0.6
|
)
|
|
Decrease
|
$
|
(71.0
|
)
|
|
Increase (decrease)
|
||
Decrease due to idle or cold-stacked rigs
|
$
|
(21.5
|
)
|
Lower reimbursable costs
|
(6.1
|
)
|
|
Reduction in jack-up direct operating expenses
|
(3.2
|
)
|
|
Reduction in shore base costs and other
|
(2.1
|
)
|
|
ARO related - decrease due to sale of assets to ARO
|
(7.8
|
)
|
|
ARO related - increase in secondment reimbursable costs
|
9.2
|
|
|
ARO related - management fee
|
7.8
|
|
|
Decrease
|
$
|
(23.7
|
)
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net cash provided by (used in) operations
|
$
|
(160.1
|
)
|
|
$
|
299.8
|
|
|
$
|
929.6
|
|
Capital expenditures
|
(169.2
|
)
|
|
(100.6
|
)
|
|
(117.6
|
)
|
|||
Purchase of rigs
|
(70.8
|
)
|
|
—
|
|
|
—
|
|
|||
Deposit on purchase of rigs
|
—
|
|
|
(7.7
|
)
|
|
—
|
|
|||
Investment in unconsolidated subsidiary
|
—
|
|
|
(30.0
|
)
|
|
—
|
|
|||
Contributions to unconsolidated subsidiary for note receivable
|
(271.3
|
)
|
|
(357.7
|
)
|
|
—
|
|
|||
Proceeds from sale of assets to unconsolidated subsidiary
|
266.0
|
|
|
357.7
|
|
|
—
|
|
|||
Repayments of note receivable from unconsolidated subsidiary
|
98.5
|
|
|
87.5
|
|
|
—
|
|
|||
Proceeds from disposals of property and equipment
|
12.7
|
|
|
3.3
|
|
|
6.2
|
|
|||
Proceeds from borrowings
|
—
|
|
|
—
|
|
|
500.0
|
|
|||
Reductions of long-term debt
|
—
|
|
|
(170.0
|
)
|
|
(511.8
|
)
|
|||
Payment of debt extinguishment costs
|
—
|
|
|
—
|
|
|
(24.0
|
)
|
|||
Debt issue costs
|
(6.1
|
)
|
|
—
|
|
|
(8.7
|
)
|
|||
Shares repurchased for tax withholdings on vesting of restricted share units
|
(5.2
|
)
|
|
(5.7
|
)
|
|
(5.0
|
)
|
|||
Proceeds from exercise of share options
|
0.1
|
|
|
—
|
|
|
—
|
|
|||
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
2.6
|
|
|||
Total net source (use)
|
$
|
(305.4
|
)
|
|
$
|
76.6
|
|
|
$
|
771.3
|
|
|
Payments due by period
|
||||||||||||||||||
|
Total
|
|
Within 1 year
|
|
2 to 3 years
|
|
4 to 5 years
|
|
After 5 years
|
||||||||||
Long-term debt principal payment
|
$
|
2,520
|
|
|
$
|
201
|
|
|
$
|
—
|
|
|
$
|
621
|
|
|
$
|
1,698
|
|
Interest on Senior Notes
|
1,549
|
|
|
140
|
|
|
262
|
|
|
214
|
|
|
933
|
|
|||||
Purchase obligations
|
128
|
|
|
128
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating leases
|
28
|
|
|
8
|
|
|
7
|
|
|
3
|
|
|
10
|
|
|||||
Total
|
$
|
4,225
|
|
|
$
|
477
|
|
|
$
|
269
|
|
|
$
|
838
|
|
|
$
|
2,641
|
|
INDEX
|
Page
|
|
|
/s/ THOMAS P. BURKE
|
/s/ STEPHEN M. BUTZ
|
Thomas P. Burke
|
Stephen M. Butz
|
President and Chief Executive Officer
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
February 27, 2019
|
February 27, 2019
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
REVENUE
|
$
|
824.8
|
|
|
$
|
1,282.8
|
|
|
$
|
1,843.2
|
|
|
|
|
|
|
|
||||||
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
|
|||
Direct operating costs (excluding items below)
|
682.7
|
|
|
685.0
|
|
|
779.7
|
|
|||
Depreciation and amortization
|
388.9
|
|
|
403.7
|
|
|
402.9
|
|
|||
Selling, general and administrative
|
96.1
|
|
|
104.6
|
|
|
102.2
|
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(65.8
|
)
|
|
(157.4
|
)
|
|
—
|
|
|||
Loss on disposals of property and equipment
|
12.1
|
|
|
9.4
|
|
|
8.7
|
|
|||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
—
|
|
|||
Material charges and other operating items
|
—
|
|
|
—
|
|
|
32.9
|
|
|||
Total costs and expenses
|
1,122.9
|
|
|
1,045.3
|
|
|
1,326.4
|
|
|||
|
|
|
|
|
|
||||||
Equity in earnings of unconsolidated subsidiary
|
10.3
|
|
|
0.9
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
INCOME (LOSS) FROM OPERATIONS
|
(287.8
|
)
|
|
238.4
|
|
|
516.8
|
|
|||
|
|
|
|
|
|
||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|||
Interest expense
|
(156.3
|
)
|
|
(155.7
|
)
|
|
(155.5
|
)
|
|||
Interest income
|
33.1
|
|
|
15.4
|
|
|
3.8
|
|
|||
Gain (Loss) on extinguishment of debt
|
—
|
|
|
1.7
|
|
|
(31.2
|
)
|
|||
Other - net
|
12.0
|
|
|
(0.5
|
)
|
|
(8.3
|
)
|
|||
Total other (expense) - net
|
(111.2
|
)
|
|
(139.1
|
)
|
|
(191.2
|
)
|
|||
|
|
|
|
|
|
||||||
INCOME (LOSS) BEFORE INCOME TAXES
|
(399.0
|
)
|
|
99.3
|
|
|
325.6
|
|
|||
Provision (benefit) for income taxes
|
(51.6
|
)
|
|
26.6
|
|
|
5.0
|
|
|||
|
|
|
|
|
|
||||||
NET INCOME (LOSS)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
320.6
|
|
|
|
|
|
|
|
||||||
NET INCOME (LOSS) PER SHARE - BASIC:
|
$
|
(2.74
|
)
|
|
$
|
0.58
|
|
|
$
|
2.56
|
|
|
|
|
|
|
|
||||||
NET INCOME (LOSS) PER SHARE - DILUTED:
|
$
|
(2.74
|
)
|
|
$
|
0.57
|
|
|
$
|
2.55
|
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
NET INCOME (LOSS)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
320.6
|
|
|
|
|
|
|
|
||||||
OTHER COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|||
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income tax expense (benefit) of $(4.8), $0, and $(2.8), respectively.
|
(17.9
|
)
|
|
(33.3
|
)
|
|
(5.1
|
)
|
|||
Net reclassification adjustment for amounts recognized in net income (loss) as a component of net periodic benefit cost, net of income tax expense (benefit) of $(1.5), $0, and $3.8, respectively.
|
(5.6
|
)
|
|
11.4
|
|
|
7.4
|
|
|||
|
|
|
|
|
|
||||||
|
(23.5
|
)
|
|
(21.9
|
)
|
|
2.3
|
|
|||
|
|
|
|
|
|
||||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
(370.9
|
)
|
|
$
|
50.8
|
|
|
$
|
322.9
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
ASSETS
|
|
|
|
||||
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,026.7
|
|
|
$
|
1,332.1
|
|
Receivables - trade and other
|
251.2
|
|
|
212.8
|
|
||
Prepaid expenses and other current assets
|
22.4
|
|
|
15.5
|
|
||
Total current assets
|
1,300.3
|
|
|
1,560.4
|
|
||
|
|
|
|
||||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
|
||
Drilling equipment
|
8,510.7
|
|
|
8,697.8
|
|
||
Other property and equipment
|
141.7
|
|
|
136.1
|
|
||
Property and equipment - gross
|
8,652.4
|
|
|
8,833.9
|
|
||
Less accumulated depreciation and amortization
|
2,451.4
|
|
|
2,281.2
|
|
||
Property and equipment - net
|
6,201.0
|
|
|
6,552.7
|
|
||
|
|
|
|
||||
Long-term note receivable from unconsolidated subsidiary
|
456.0
|
|
|
270.2
|
|
||
|
|
|
|
||||
Investment in unconsolidated subsidiary
|
41.2
|
|
|
30.9
|
|
||
|
|
|
|
||||
Other assets
|
119.2
|
|
|
44.1
|
|
||
|
$
|
8,117.7
|
|
|
$
|
8,458.3
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
||||
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
|
|
||
Current portion of long-term debt
|
$
|
201.2
|
|
|
$
|
—
|
|
Accounts payable - trade
|
122.3
|
|
|
97.2
|
|
||
Deferred revenue
|
16.7
|
|
|
1.1
|
|
||
Accrued liabilities
|
113.4
|
|
|
159.1
|
|
||
Total current liabilities
|
453.6
|
|
|
257.4
|
|
||
|
|
|
|
||||
Long-term debt
|
2,309.7
|
|
|
2,510.3
|
|
||
Other liabilities
|
307.7
|
|
|
293.6
|
|
||
Deferred income taxes - net
|
11.7
|
|
|
10.9
|
|
||
Commitments and contingent liabilities (
Note 9
)
|
|
|
|
|
|
||
|
|
|
|
||||
SHAREHOLDERS' EQUITY:
|
|
|
|
|
|
||
Class A Ordinary Shares, $0.125 par value; 128.2 and 128.1 shares issued, respectively; 127.1 and 126.3 shares outstanding, respectively
|
16.0
|
|
|
16.0
|
|
||
Additional paid-in capital
|
1,501.5
|
|
|
1,488.6
|
|
||
Retained earnings
|
3,810.5
|
|
|
4,109.7
|
|
||
Cost of 1.1 and 1.8 treasury shares, respectively
|
(7.9
|
)
|
|
(9.3
|
)
|
||
Accumulated other comprehensive loss
|
(285.1
|
)
|
|
(218.9
|
)
|
||
Total shareholders' equity
|
5,035.0
|
|
|
5,386.1
|
|
||
|
$
|
8,117.7
|
|
|
$
|
8,458.3
|
|
|
Shares outstanding
|
|
Class A Ordinary Shares/ Common stock
|
|
Additional paid-in capital
|
|
Retained earnings
|
|
Treasury shares
|
|
Accumulated other comprehensive income (loss)
|
|
Total shareholders' equity
|
|||||||||||||
Balance, January 1, 2016
|
124.8
|
|
|
$
|
15.7
|
|
|
$
|
1,458.5
|
|
|
$
|
3,509.8
|
|
|
$
|
(12.2
|
)
|
|
$
|
(199.3
|
)
|
|
$
|
4,772.5
|
|
Net shares issued (acquired) under share-based compensation plans
|
0.7
|
|
|
0.3
|
|
|
(9.8
|
)
|
|
—
|
|
|
5.0
|
|
|
—
|
|
|
(4.5
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
20.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.4
|
|
||||||
Excess tax benefit from share-based awards
|
—
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
||||||
Retirement benefit adjustments, net of tax expense of $1.0
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.3
|
|
|
2.3
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
320.6
|
|
|
—
|
|
|
—
|
|
|
320.6
|
|
||||||
Balance, December 31, 2016
|
125.5
|
|
|
16.0
|
|
|
1,471.7
|
|
|
3,830.4
|
|
|
(7.2
|
)
|
|
(197.0
|
)
|
|
5,113.9
|
|
||||||
Net shares issued (acquired) under share-based compensation plans
|
0.8
|
|
|
—
|
|
|
(2.4
|
)
|
|
—
|
|
|
(2.1
|
)
|
|
—
|
|
|
(4.5
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
19.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19.3
|
|
||||||
Adoption of new accounting standard
|
—
|
|
|
—
|
|
|
—
|
|
|
206.6
|
|
|
—
|
|
|
—
|
|
|
206.6
|
|
||||||
Retirement benefit adjustments, net of tax expense of $0
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21.9
|
)
|
|
(21.9
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
72.7
|
|
|
—
|
|
|
—
|
|
|
72.7
|
|
||||||
Balance, December 31, 2017
|
126.3
|
|
|
16.0
|
|
|
1,488.6
|
|
|
4,109.7
|
|
|
(9.3
|
)
|
|
(218.9
|
)
|
|
5,386.1
|
|
||||||
Net shares issued (acquired) under share-based compensation plans
|
0.8
|
|
|
—
|
|
|
(5.1
|
)
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
(3.7
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
18.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18.0
|
|
||||||
Adoption of new accounting standards (see
Note 2
)
|
—
|
|
|
—
|
|
|
—
|
|
|
51.1
|
|
|
—
|
|
|
(45.6
|
)
|
|
5.5
|
|
||||||
Retirement benefit adjustments, net of tax benefit of $6.3
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23.5
|
)
|
|
(23.5
|
)
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.9
|
)
|
|
—
|
|
|
2.9
|
|
|
—
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(347.4
|
)
|
|
—
|
|
|
—
|
|
|
(347.4
|
)
|
||||||
Balance, December 31, 2018
|
127.1
|
|
|
$
|
16.0
|
|
|
$
|
1,501.5
|
|
|
$
|
3,810.5
|
|
|
$
|
(7.9
|
)
|
|
$
|
(285.1
|
)
|
|
$
|
5,035.0
|
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
320.6
|
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
388.9
|
|
|
403.7
|
|
|
402.9
|
|
|||
Equity in earnings of unconsolidated subsidiary
|
(10.3
|
)
|
|
(0.9
|
)
|
|
—
|
|
|||
Deferred income taxes
|
(68.1
|
)
|
|
24.7
|
|
|
(37.9
|
)
|
|||
Pension and other postretirement benefits (income) expense
|
(9.0
|
)
|
|
12.5
|
|
|
15.0
|
|
|||
Share-based compensation expense
|
24.0
|
|
|
29.0
|
|
|
34.6
|
|
|||
Gain on sale of assets to unconsolidated subsidiary
|
(65.8
|
)
|
|
(157.4
|
)
|
|
—
|
|
|||
Loss on disposals of property and equipment
|
12.1
|
|
|
9.4
|
|
|
8.7
|
|
|||
Contingent payment derivative
|
—
|
|
|
0.1
|
|
|
(6.1
|
)
|
|||
Non-cash interest income from unconsolidated subsidiary (receipt in kind)
|
(12.0
|
)
|
|
—
|
|
|
—
|
|
|||
Asset impairment charges
|
—
|
|
|
—
|
|
|
34.3
|
|
|||
Cash loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
24.0
|
|
|||
Other
|
8.1
|
|
|
1.5
|
|
|
3.7
|
|
|||
Changes in current assets and liabilities:
|
|
|
|
|
|
|
|
|
|||
Receivables - trade and other
|
(7.2
|
)
|
|
82.9
|
|
|
109.2
|
|
|||
Prepaid expenses and other current assets
|
(6.1
|
)
|
|
14.2
|
|
|
9.2
|
|
|||
Accounts payable
|
2.8
|
|
|
1.9
|
|
|
(4.0
|
)
|
|||
Accrued income taxes
|
(12.3
|
)
|
|
(3.8
|
)
|
|
(3.4
|
)
|
|||
Other current liabilities
|
(25.1
|
)
|
|
7.8
|
|
|
(27.2
|
)
|
|||
Other postretirement benefit claims paid
|
(1.4
|
)
|
|
(18.4
|
)
|
|
(7.9
|
)
|
|||
Contributions to pension plans
|
(24.2
|
)
|
|
(29.3
|
)
|
|
(22.5
|
)
|
|||
Deferred revenue
|
5.5
|
|
|
(112.8
|
)
|
|
63.7
|
|
|||
Net changes in other noncurrent assets and liabilities
|
(12.6
|
)
|
|
(38.0
|
)
|
|
12.7
|
|
|||
Net cash provided by (used in) operating activities
|
(160.1
|
)
|
|
299.8
|
|
|
929.6
|
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
(169.2
|
)
|
|
(100.6
|
)
|
|
(117.6
|
)
|
|||
Purchase of rigs
|
(70.8
|
)
|
|
—
|
|
|
—
|
|
|||
Deposit on purchase of rigs
|
—
|
|
|
(7.7
|
)
|
|
—
|
|
|||
Investment in unconsolidated subsidiary
|
—
|
|
|
(30.0
|
)
|
|
—
|
|
|||
Contributions to unconsolidated subsidiary for note receivable
|
(271.3
|
)
|
|
(357.7
|
)
|
|
—
|
|
|||
Proceeds from sale of assets to unconsolidated subsidiary
|
266.0
|
|
|
357.7
|
|
|
—
|
|
|||
Repayments of note receivable from unconsolidated subsidiary
|
98.5
|
|
|
87.5
|
|
|
—
|
|
|||
Proceeds from disposals of property and equipment
|
12.7
|
|
|
3.3
|
|
|
6.2
|
|
|||
Net cash used in investing activities
|
(134.1
|
)
|
|
(47.5
|
)
|
|
(111.4
|
)
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Proceeds from borrowings
|
—
|
|
|
—
|
|
|
500.0
|
|
|||
Reductions of long-term debt
|
—
|
|
|
(170.0
|
)
|
|
(511.8
|
)
|
|||
Payment of debt extinguishment costs
|
—
|
|
|
—
|
|
|
(24.0
|
)
|
|||
Debt issue costs
|
(6.1
|
)
|
|
—
|
|
|
(8.7
|
)
|
|||
Proceeds from exercise of share options
|
0.1
|
|
|
—
|
|
|
—
|
|
|||
Shares repurchased for tax withholdings on vesting of restricted share units
|
(5.2
|
)
|
|
(5.7
|
)
|
|
(5.0
|
)
|
|||
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
2.6
|
|
|||
Net cash used in financing activities
|
(11.2
|
)
|
|
(175.7
|
)
|
|
(46.9
|
)
|
|||
|
|
|
|
|
|
||||||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(305.4
|
)
|
|
76.6
|
|
|
771.3
|
|
|||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
1,332.1
|
|
|
1,255.5
|
|
|
484.2
|
|
|||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
1,026.7
|
|
|
$
|
1,332.1
|
|
|
$
|
1,255.5
|
|
|
2018
|
|
2017
|
||||
Trade
|
$
|
231.7
|
|
|
$
|
195.8
|
|
Income tax
|
12.0
|
|
|
8.0
|
|
||
Other
|
7.5
|
|
|
9.0
|
|
||
Total receivables - trade and other
|
$
|
251.2
|
|
|
$
|
212.8
|
|
|
Life (in years)
|
|
Salvage Value
|
|
Jack-up drilling rigs:
|
|
|
|
|
Hulls
|
25 to 35
|
|
10
|
%
|
Legs
|
25 to 30
|
|
10
|
%
|
Quarters
|
25
|
|
10
|
%
|
Drilling equipment
|
2 to 25
|
|
0% to 10%
|
|
|
|
|
|
|
Drillships:
|
|
|
|
|
Hulls
|
35
|
|
10
|
%
|
Drilling equipment
|
2 to 25
|
|
0% to 10%
|
|
|
|
|
|
|
Drill pipe and tubular equipment
|
4
|
|
10
|
%
|
Other property and equipment
|
3 to 30
|
|
various
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income (loss)
|
$
|
(347.4
|
)
|
|
$
|
72.7
|
|
|
$
|
320.6
|
|
Income allocated to non-vested share awards
|
—
|
|
|
0.1
|
|
|
1.5
|
|
|||
Net income (loss) - adjusted for income allocated to non-vested share awards
|
$
|
(347.4
|
)
|
|
$
|
72.8
|
|
|
$
|
322.1
|
|
|
2018
|
|
2017
|
|
2016
|
|||
Average common shares outstanding
|
126.9
|
|
|
126.1
|
|
|
125.3
|
|
Effect of dilutive securities - share based compensation
|
—
|
|
|
1.6
|
|
|
1.0
|
|
Average shares for diluted computations
|
126.9
|
|
|
127.7
|
|
|
126.3
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Share options and appreciation rights
|
$
|
1.4
|
|
|
$
|
1.5
|
|
|
$
|
1.6
|
|
P-Units, RSAs and RSUs
|
5.7
|
|
|
2.1
|
|
|
0.9
|
|
|||
Total potentially dilutive shares
|
$
|
7.1
|
|
|
$
|
3.6
|
|
|
$
|
2.5
|
|
Fee type
|
|
Revenue Recognition
|
Day rate
|
|
Recognition is based on the day rates earned/invoiced as it relates to the level of service provided for each fractional-hour throughout the contract.
|
Mobilization and upgrade/modification
|
|
Revenue (both lump-sum and day rate amounts) is estimated at contract inception and included in the transaction price to be recognized over the expected recognition period.
|
Demobilization
|
|
Unconstrained demobilization revenue (both lump-sum and day rate amounts) is estimated at contract inception, included in the transaction price, and recognized over the expected recognition period in proportion to the passage of each hour available to drill.
|
Bonuses and penalty
|
|
Unconstrained bonus and/or penalty revenue is estimated at contract inception and included in the transaction price. Amounts are recognized in the period corresponding to the distinct hourly increment(s) of service provided (i.e. the specific period which the bonus or penalty relates to).
|
Reimbursement
|
|
Recognized (gross of costs incurred), at the point the product or service is consumed, and in the amount billed to the customer.
|
•
|
use of the transition package of practical expedients which, among other things, allows us to carryforward the historical lease classification for existing leases;
|
•
|
making an accounting policy election that will keep leases with an initial term of 12 months or less off the balance sheet; and
|
•
|
not separating non-lease components from lease components for all classes of underlying lease assets.
|
|
|
|
December 31,
|
||||||
|
Balance Sheet Classification
|
|
2018
|
|
2017
|
||||
Deferred Contract Costs and Demobilization Contract Assets
|
|
|
|
|
|
||||
Current
|
Prepaid expenses and other current assets
|
|
$
|
8.7
|
|
|
$
|
2.8
|
|
Noncurrent
|
Other assets
|
|
0.4
|
|
|
—
|
|
||
|
|
|
$
|
9.1
|
|
|
$
|
2.8
|
|
|
|
|
|
|
|
||||
Deferred Revenue - Contract Liabilities
|
|
|
|
|
|
||||
Current
|
Deferred revenue
|
|
$
|
16.7
|
|
|
$
|
1.1
|
|
Noncurrent
|
Other liabilities
|
|
19.1
|
|
|
0.5
|
|
||
|
|
|
$
|
35.8
|
|
|
$
|
1.6
|
|
|
|
|
|
|
|
|
2018
|
||
Deferred Contract Costs Asset
|
|
||
Beginning balance
|
$
|
2.8
|
|
Plus: contractual additions
|
8.9
|
|
|
Less: amortization
|
8.1
|
|
|
Ending balance
|
$
|
3.6
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Total
|
||||||||||
Amortization of deferred revenue
|
|
$
|
16.7
|
|
|
$
|
9.6
|
|
|
$
|
8.5
|
|
|
$
|
1.0
|
|
|
$
|
35.8
|
|
Amortization of deferred contract costs
|
|
3.2
|
|
|
0.2
|
|
|
0.2
|
|
|
—
|
|
|
3.6
|
|
|
Year ended
|
|
October 17, 2017 to
|
||||
|
December 31, 2018
|
|
December 31, 2017
|
||||
Revenue
|
$
|
348.8
|
|
|
$
|
48.6
|
|
Direct operating costs (excluding items below)
|
194.0
|
|
|
22.2
|
|
||
Depreciation and amortization
|
67.4
|
|
|
12.9
|
|
||
Selling, general and administrative
|
27.0
|
|
|
6.1
|
|
||
(Gain) loss on disposals of property and equipment
|
1.4
|
|
|
(0.1
|
)
|
||
Income from Operations
|
59.0
|
|
|
7.5
|
|
||
Interest expense
|
(26.2
|
)
|
|
(4.2
|
)
|
||
Provision for income taxes
|
12.3
|
|
|
1.6
|
|
||
Net Income
|
$
|
20.5
|
|
|
$
|
1.7
|
|
|
|
|
|
||||
Rowan's equity in earnings from ARO
|
$
|
10.3
|
|
|
$
|
0.9
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Current assets
|
$
|
348.9
|
|
|
$
|
108.6
|
|
Non-current assets
|
727.0
|
|
|
459.7
|
|
||
Total assets
|
$
|
1,075.9
|
|
|
$
|
568.3
|
|
|
|
|
|
||||
Current liabilities
|
$
|
112.2
|
|
|
$
|
29.2
|
|
Non-current liabilities
|
949.1
|
|
|
545.1
|
|
||
Total liabilities
|
$
|
1,061.3
|
|
|
$
|
574.3
|
|
Long-term note receivable from unconsolidated subsidiary
|
2018
|
|
2017
|
|
|
||||
Beginning Balance January 1,
|
$
|
270.2
|
|
|
$
|
—
|
|
|
|
Origination
|
271.3
|
|
|
357.7
|
|
|
See
Note 1
|
||
Repayments
(2)
|
(98.5
|
)
|
|
(87.5
|
)
|
|
See
Note 1
|
||
Interest in kind
|
12.0
|
|
|
—
|
|
|
|
||
Other
|
1.0
|
|
|
1.1
|
|
|
|
||
Total
|
456.0
|
|
|
271.3
|
|
|
|
||
Less: Current Portion
(1)
|
—
|
|
|
1.1
|
|
|
|
||
Ending Balance December 31,
|
$
|
456.0
|
|
|
$
|
270.2
|
|
|
|
|
|
|
|
|
|
||||
(1)
Included in Receivables - trade and other on the Company's Consolidated Balance Sheet.
|
|||||||||
(2)
Includes excess cash distributed back to Rowan in October of 2018 and October 2017 (See
Note 1
).
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Total assets
|
$
|
566.0
|
|
|
$
|
319.5
|
|
Total liabilities
|
6.1
|
|
|
10.8
|
|
||
Maximum exposure to loss
|
$
|
559.9
|
|
|
$
|
308.7
|
|
|
2018
|
|
2017
|
||||
Pension and other postretirement benefits
|
$
|
16.8
|
|
|
$
|
27.0
|
|
Compensation and related employee costs
|
45.0
|
|
|
69.0
|
|
||
Interest
|
34.0
|
|
|
32.0
|
|
||
Income taxes
|
7.1
|
|
|
15.4
|
|
||
Other
|
10.5
|
|
|
15.7
|
|
||
Total accrued liabilities
|
$
|
113.4
|
|
|
$
|
159.1
|
|
|
2018
|
|
2017
|
||||
7.875% Senior Notes, due August 2019 ($201.4 million principal amount; 8.0% effective rate)
|
$
|
201.2
|
|
|
$
|
200.9
|
|
4.875% Senior Notes, due June 2022 ($620.8 million principal amount; 4.7% effective rate)
|
623.8
|
|
|
624.6
|
|
||
4.75% Senior Notes, due January 2024 ($398.1 million principal amount; 4.8% effective rate)
|
396.3
|
|
|
395.9
|
|
||
7.375% Senior Notes, due June 2025 ($500 million principal amount; 7.4% effective rate)
|
497.8
|
|
|
497.5
|
|
||
5.4% Senior Notes, due December 2042 ($400 million principal amount; 5.4% effective rate)
|
395.3
|
|
|
395.1
|
|
||
5.85% Senior Notes, due January 2044 ($400 million principal amount; 5.9% effective rate)
|
396.5
|
|
|
396.3
|
|
||
Total carrying value
|
2,510.9
|
|
|
2,510.3
|
|
||
Current portion
(1)
|
201.2
|
|
|
—
|
|
||
Carrying value, less current portion
|
$
|
2,309.7
|
|
|
$
|
2,510.3
|
|
|
|
|
|
||||
(1)
Current portion of long-term debt at December 31, 2018 included the 7.875% Senior Notes due in August 2019.
|
2019
|
$
|
201.4
|
|
2020
|
—
|
|
|
2021
|
—
|
|
|
2022
|
620.8
|
|
|
2023
|
—
|
|
|
Thereafter
|
1,698.1
|
|
|
|
$
|
2,520.3
|
|
|
|
Min/Max
|
|
Value as of
|
||||
Financial covenant
|
|
Requirement
|
|
December 31, 2018
|
|
|||
Debt to capitalization Ratio
|
|
55
|
%
|
|
33
|
%
|
||
Liquidity (in millions)
|
|
$
|
300.0
|
|
|
$
|
2,285.6
|
|
Marketed Rig Value Ratio
|
|
3.00
|
|
|
4.10
|
|
||
Guaranteed Rig Value Ratio
|
|
80
|
%
|
|
86
|
%
|
•
|
Level 1 – Quoted prices for identical instruments in active markets;
|
•
|
Level 2 – Quoted market prices for similar instruments in active markets; quoted prices for identical instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable, such as those used in pricing models or discounted cash flow methodologies, for example.
|
|
|
|
Estimated fair value measurements
|
||||||||||||
|
Fair value
|
|
Quoted prices in active markets (Level 1)
|
|
Significant other observable inputs (Level 2)
|
|
Significant other unobservable inputs (Level 3)
|
||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
||||||||
Assets - cash equivalents
|
$
|
990.5
|
|
|
$
|
990.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other assets (Egyptian Pounds)
|
0.7
|
|
|
0.7
|
|
|
—
|
|
|
—
|
|
||||
Other assets (Angolan Kwanza)
|
1.7
|
|
|
1.7
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
||||||||
Assets - cash equivalents
|
$
|
1,332.1
|
|
|
$
|
1,332.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other assets (Egyptian Pounds)
|
2.2
|
|
|
2.2
|
|
|
—
|
|
|
—
|
|
||||
Other assets (Angolan Kwanza)
|
4.3
|
|
|
4.3
|
|
|
—
|
|
|
—
|
|
|
|
|
|
Years ended December 31,
|
|||||||
Customer
|
|
Segment
|
|
2018
|
|
2017
|
|
2016
|
|||
Saudi Aramco
|
|
Jack-ups
|
|
28
|
%
|
|
29
|
%
|
|
20
|
%
|
Anadarko
|
|
Deepwater
|
|
14
|
%
|
|
17
|
%
|
|
8
|
%
|
ARO Drilling
(1)
|
|
Jack-ups and Unallocated and other
|
|
14
|
%
|
|
1
|
%
|
|
—
|
%
|
BP Trinidad and Tobago
|
|
Jack-ups
|
|
10
|
%
|
|
6
|
%
|
|
5
|
%
|
Repsol
|
|
Deepwater and Jack-ups
|
|
2
|
%
|
|
7
|
%
|
|
12
|
%
|
ConocoPhillips
|
|
Jack-ups
|
|
2
|
%
|
|
7
|
%
|
|
11
|
%
|
Freeport-McMoRan
|
|
Deepwater and Jack-ups
|
|
1
|
%
|
|
—
|
%
|
|
12
|
%
|
Cobalt International
(2)
|
|
Deepwater
|
|
—
|
%
|
|
14
|
%
|
|
12
|
%
|
|
|
|
|
|
|
|
|
|
|||
(1)
Includes revenue related to services provided to ARO (see
Note 4
).
|
|||||||||||
(2)
The year ended December 31, 2017, includes amortization of $95.9 million of revenue deferred in 2016 related to a contract amendment to the Company's subsidiary's drilling contract with Cobalt International (See
Note 1
).
|
|
|
|
|
December 31,
|
||||
Customer
|
|
Segment
|
|
2018
|
|
2017
|
||
Saudi Aramco
|
|
Jack-ups
|
|
21
|
%
|
|
34
|
%
|
Anadarko
|
|
Deepwater
|
|
—
|
%
|
|
19
|
%
|
ARO Drilling
(1)
|
|
Jack-ups and Unallocated and other
|
|
30
|
%
|
|
9
|
%
|
BP Trinidad and Tobago
|
|
Jack-ups
|
|
9
|
%
|
|
6
|
%
|
Repsol
|
|
Deepwater and Jack-ups
|
|
4
|
%
|
|
5
|
%
|
ConocoPhillips
|
|
Jack-ups
|
|
—
|
%
|
|
8
|
%
|
Freeport-McMoRan
|
|
Deepwater and Jack-ups
|
|
1
|
%
|
|
—
|
%
|
Cobalt International
|
|
Deepwater
|
|
—
|
%
|
|
—
|
%
|
|
|
|
|
|
|
|
||
(1)
Includes receivables related to services provided to ARO (see
Note 4
).
|
2019
|
$
|
7.6
|
|
2020
|
5.1
|
|
|
2021
|
1.9
|
|
|
2022
|
1.8
|
|
|
2023
|
1.8
|
|
|
Later years
|
10.0
|
|
|
|
$
|
28.2
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Restricted shares and restricted share units
|
$
|
18.0
|
|
|
$
|
19.3
|
|
|
$
|
21.8
|
|
Share appreciation rights
|
—
|
|
|
—
|
|
|
0.2
|
|
|||
Performance-based awards
|
6.0
|
|
|
9.7
|
|
|
12.6
|
|
|||
Total compensation cost
|
$
|
24.0
|
|
|
$
|
29.0
|
|
|
$
|
34.6
|
|
|
Number of shares
|
|
Weighted-average grant-date fair value per share
|
|||
|
(in thousands)
|
|
|
|||
Outstanding at January 1, 2018
|
203
|
|
|
$
|
25.62
|
|
Granted
|
26
|
|
|
15.29
|
|
|
Settled
|
—
|
|
|
—
|
|
|
Outstanding at December 31, 2018
|
229
|
|
|
$
|
24.44
|
|
|
|
|
|
|||
Vested at December 31, 2018
|
203
|
|
|
$
|
25.62
|
|
|
Number of shares
|
|
Weighted-average grant-date fair value per share
|
|||
|
(in thousands)
|
|
|
|||
Outstanding at January 1, 2018
|
91
|
|
|
$
|
13.24
|
|
Granted
|
78
|
|
|
15.29
|
|
|
Settled
|
(91
|
)
|
|
13.24
|
|
|
Outstanding at December 31, 2018
|
78
|
|
|
$
|
15.29
|
|
|
|
|
|
|||
Vested at December 31, 2018
|
—
|
|
|
$
|
—
|
|
|
Number of shares under SARs
|
|
Weighted-average exercise price
|
|
Weighted-average remaining contractual term (in years)
|
|
Aggregate intrinsic value
|
|||||
|
(in thousands)
|
|
|
|
|
|
(in millions)
|
|||||
Outstanding at January 1, 2018
|
1,029
|
|
|
$
|
31.03
|
|
|
|
|
|
||
Forfeited or expired
|
(17
|
)
|
|
36.86
|
|
|
|
|
|
|||
Outstanding at December 31, 2018
|
1,012
|
|
|
$
|
30.93
|
|
|
2.0
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at December 31, 2018
|
1,012
|
|
|
$
|
30.93
|
|
|
2.0
|
|
$
|
—
|
|
|
February 22, 2017
|
||
Expected life in years
|
5.5
|
|
|
Risk-free interest rate
|
1.987
|
%
|
|
Expected volatility
|
40.551
|
%
|
|
Weighted average grant date per share fair value
|
$
|
7.04
|
|
|
Number of shares under option
|
|
Weighted-average exercise price
|
|
Weighted-average remaining contractual term (in years)
|
|
Aggregate intrinsic value
|
|||||
|
(in thousands)
|
|
|
|
|
|
(in thousands)
|
|||||
Outstanding at January 1, 2018
|
455
|
|
|
$
|
17.08
|
|
|
|
|
|
||
Exercised
|
(5
|
)
|
|
15.31
|
|
|
|
|
$
|
19.2
|
|
|
Expired
|
(95
|
)
|
|
15.31
|
|
|
|
|
|
|||
Outstanding at December 31, 2018
|
355
|
|
|
$
|
17.59
|
|
|
5.1
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at December 31, 2018
|
—
|
|
|
$
|
—
|
|
|
0.0
|
|
$
|
—
|
|
|
2018
|
|
2017
|
||||||||||||||||||||
|
Pension benefits
|
|
Other benefits
|
|
Total
|
|
Pension benefits
|
|
Other benefits
|
|
Total
|
||||||||||||
Projected benefit obligations:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, January 1
|
$
|
835.8
|
|
|
$
|
18.0
|
|
|
$
|
853.8
|
|
|
$
|
772.1
|
|
|
$
|
29.9
|
|
|
$
|
802.0
|
|
Interest cost
|
27.9
|
|
|
0.5
|
|
|
28.4
|
|
|
25.5
|
|
|
0.9
|
|
|
26.4
|
|
||||||
Service cost
|
6.1
|
|
|
0.1
|
|
|
6.2
|
|
|
12.3
|
|
|
0.1
|
|
|
12.4
|
|
||||||
Actuarial (gain) loss
|
(51.4
|
)
|
|
(1.2
|
)
|
|
(52.6
|
)
|
|
78.0
|
|
|
5.5
|
|
|
83.5
|
|
||||||
Plan amendments
|
(0.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Plan settlements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16.4
|
)
|
|
(16.4
|
)
|
||||||
Plan curtailments
|
(1.1
|
)
|
|
—
|
|
|
(1.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exchange rate changes
|
(0.4
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
||||||
Benefits paid
|
(57.7
|
)
|
|
(1.4
|
)
|
|
(59.1
|
)
|
|
(52.4
|
)
|
|
(2.0
|
)
|
|
(54.4
|
)
|
||||||
Balance, December 31
|
758.7
|
|
|
16.0
|
|
|
774.7
|
|
|
835.8
|
|
|
18.0
|
|
|
853.8
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Plan assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Fair value, January 1
|
609.7
|
|
|
—
|
|
|
609.7
|
|
|
544.6
|
|
|
—
|
|
|
544.6
|
|
||||||
Actual return
|
(40.5
|
)
|
|
—
|
|
|
(40.5
|
)
|
|
88.0
|
|
|
—
|
|
|
88.0
|
|
||||||
Employer contributions
|
24.2
|
|
|
—
|
|
|
24.2
|
|
|
29.3
|
|
|
—
|
|
|
29.3
|
|
||||||
Plan settlements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Exchange rate changes
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
||||||
Benefits paid
|
(57.7
|
)
|
|
—
|
|
|
(57.7
|
)
|
|
(52.4
|
)
|
|
—
|
|
|
(52.4
|
)
|
||||||
Fair value, December 31
|
535.5
|
|
|
—
|
|
|
535.5
|
|
|
609.7
|
|
|
—
|
|
|
609.7
|
|
||||||
Net benefit liabilities
|
$
|
(223.2
|
)
|
|
$
|
(16.0
|
)
|
|
$
|
(239.2
|
)
|
|
$
|
(226.1
|
)
|
|
$
|
(18.0
|
)
|
|
$
|
(244.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Amounts recognized in Consolidated Balance Sheet:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accrued liabilities
|
$
|
(15.1
|
)
|
|
$
|
(1.7
|
)
|
|
$
|
(16.8
|
)
|
|
$
|
(24.5
|
)
|
|
$
|
(2.5
|
)
|
|
$
|
(27.0
|
)
|
Other liabilities (long-term)
|
(208.1
|
)
|
|
(14.3
|
)
|
|
(222.4
|
)
|
|
(201.6
|
)
|
|
(15.5
|
)
|
|
(217.1
|
)
|
||||||
Net benefit liabilities
|
$
|
(223.2
|
)
|
|
$
|
(16.0
|
)
|
|
$
|
(239.2
|
)
|
|
$
|
(226.1
|
)
|
|
$
|
(18.0
|
)
|
|
$
|
(244.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accumulated contributions in excess of (less than) net periodic benefit cost
|
$
|
141.7
|
|
|
$
|
(25.8
|
)
|
|
$
|
115.9
|
|
|
$
|
120.2
|
|
|
$
|
(39.1
|
)
|
|
$
|
81.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Amounts not yet reflected in net periodic benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Actuarial (loss) gain
|
(364.2
|
)
|
|
(4.3
|
)
|
|
(368.5
|
)
|
|
(358.1
|
)
|
|
(6.3
|
)
|
|
(364.4
|
)
|
||||||
Prior service credit
|
(0.7
|
)
|
|
14.1
|
|
|
13.4
|
|
|
11.8
|
|
|
27.4
|
|
|
39.2
|
|
||||||
Total accumulated other comprehensive income (loss)
|
(364.9
|
)
|
|
9.8
|
|
|
(355.1
|
)
|
|
(346.3
|
)
|
|
21.1
|
|
|
(325.2
|
)
|
||||||
Net benefit liabilities
|
$
|
(223.2
|
)
|
|
$
|
(16.0
|
)
|
|
$
|
(239.2
|
)
|
|
$
|
(226.1
|
)
|
|
$
|
(18.0
|
)
|
|
$
|
(244.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted-average assumptions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Discount rate
|
4.35
|
%
|
|
4.23
|
%
|
|
|
|
|
3.68
|
%
|
|
3.52
|
%
|
|
|
|
||||||
Rate of compensation increase
|
3.78
|
%
|
|
|
|
|
|
|
|
4.28
|
%
|
|
|
|
|
|
|
|
2018
|
|
2017
|
||||
Accumulated benefit obligation
|
$
|
754.7
|
|
|
$
|
830.8
|
|
|
Liability increase (decrease)
|
|
Accumulated other comprehensive income (loss)
|
|
Deferred tax asset decrease (increase)
|
|
Income included in Other- net
|
|
Income tax expense (increase) decrease
|
||||||||||
Plan change to projected benefit obligation
|
$
|
(1.6
|
)
|
|
$
|
1.3
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Remeasurement gain
|
(29.9
|
)
|
|
23.6
|
|
|
6.3
|
|
|
—
|
|
|
—
|
|
|||||
Curtailment
|
—
|
|
|
(9.0
|
)
|
|
(1.0
|
)
|
|
11.4
|
|
|
(1.4
|
)
|
|||||
Total
|
$
|
(31.5
|
)
|
|
$
|
15.9
|
|
|
$
|
5.6
|
|
|
$
|
11.4
|
|
|
$
|
(1.4
|
)
|
|
Liability increase (decrease)
|
|
Accumulated other comprehensive income (loss)
|
|
Deferred tax liability increase (decrease)
|
||||||
Plan change benefit
|
$
|
(39.9
|
)
|
|
$
|
25.9
|
|
|
$
|
14.0
|
|
Remeasurement loss
|
5.2
|
|
|
(3.4
|
)
|
|
(1.8
|
)
|
|||
Actuarial loss
|
5.2
|
|
|
(3.3
|
)
|
|
(1.9
|
)
|
|||
Total
|
$
|
(29.5
|
)
|
|
$
|
19.2
|
|
|
$
|
10.3
|
|
|
Pension benefits
|
|
Other retirement benefits
|
|
Total
|
||||||
Actuarial (loss) gain
|
$
|
(9.0
|
)
|
|
$
|
(0.6
|
)
|
|
$
|
(9.6
|
)
|
Prior service credit
|
—
|
|
|
12.4
|
|
|
12.4
|
|
|||
Total amortization
|
$
|
(9.0
|
)
|
|
$
|
11.8
|
|
|
$
|
2.8
|
|
|
Target range
|
|
Total
|
|
Quoted prices in active markets for identical assets (Level 1)
|
|
Significant observable inputs (Level 2)
|
|
Significant unobservable inputs (Level 3)
|
||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||
Equities:
|
53% to 69%
|
|
|
|
|
|
|
|
|
||||||||
U.S. large cap
|
22% to 28%
|
|
$
|
131.6
|
|
|
$
|
—
|
|
|
$
|
131.6
|
|
|
$
|
—
|
|
U.S. small cap
|
4% to 10%
|
|
35.6
|
|
|
—
|
|
|
35.6
|
|
|
—
|
|
||||
International all cap
|
21% to 29%
|
|
129.9
|
|
|
—
|
|
|
129.9
|
|
|
—
|
|
||||
International small cap
|
2% to 8%
|
|
28.8
|
|
|
—
|
|
|
28.8
|
|
|
—
|
|
||||
Real estate equities
|
0% to 13%
|
|
51.7
|
|
|
—
|
|
|
51.7
|
|
|
—
|
|
||||
Fixed income:
|
25% to 35%
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and equivalents
|
0% to 10%
|
|
4.1
|
|
|
—
|
|
|
4.1
|
|
|
—
|
|
||||
Aggregate
|
9% to 19%
|
|
73.9
|
|
|
—
|
|
|
73.9
|
|
|
—
|
|
||||
Core plus
|
9% to 19%
|
|
74.7
|
|
|
74.7
|
|
|
—
|
|
|
—
|
|
||||
Group annuity contracts
|
|
|
5.2
|
|
|
—
|
|
|
5.2
|
|
|
—
|
|
||||
Total
|
|
|
$
|
535.5
|
|
|
$
|
74.7
|
|
|
$
|
460.8
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equities:
|
53% to 69%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. large cap
|
22% to 28%
|
|
$
|
158.2
|
|
|
$
|
—
|
|
|
$
|
158.2
|
|
|
$
|
—
|
|
U.S. small cap
|
4% to 10%
|
|
45.3
|
|
|
—
|
|
|
45.3
|
|
|
—
|
|
||||
International all cap
|
21% to 29%
|
|
156.2
|
|
|
—
|
|
|
156.2
|
|
|
—
|
|
||||
International small cap
|
2% to 8%
|
|
36.3
|
|
|
—
|
|
|
36.3
|
|
|
—
|
|
||||
Real estate equities
|
0% to 13%
|
|
50.6
|
|
|
—
|
|
|
50.6
|
|
|
—
|
|
||||
Fixed income:
|
25% to 35%
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and equivalents
|
0% to 10%
|
|
6.2
|
|
|
—
|
|
|
6.2
|
|
|
—
|
|
||||
Aggregate
|
9% to 19%
|
|
74.9
|
|
|
—
|
|
|
74.9
|
|
|
—
|
|
||||
Core plus
|
9% to 19%
|
|
78.1
|
|
|
78.1
|
|
|
—
|
|
|
—
|
|
||||
Group annuity contracts
|
|
|
3.9
|
|
|
—
|
|
|
3.9
|
|
|
—
|
|
||||
Total
|
|
|
$
|
609.7
|
|
|
$
|
78.1
|
|
|
$
|
531.6
|
|
|
$
|
—
|
|
•
|
Fair values of all U.S. equity securities, the international all cap equity securities and aggregate fixed income securities categorized as Level 2 were held in commingled funds which were valued daily based on a net asset value.
|
•
|
Fair value of international small cap equity securities categorized as Level 2 were held in a limited partnership fund which was valued monthly based on a net asset value.
|
•
|
The real estate categorized as Level 2 was held in two accounts (a commingled fund and a limited partnership). The assets in the commingled fund were valued monthly based on a net asset value and the assets in the limited partnership were valued quarterly based on a net asset value.
|
•
|
Cash and equivalents categorized as Level 2 were valued at cost, which approximates fair value.
|
•
|
Fair value of mutual fund investments in core plus fixed income securities categorized as Level 1 were based on quoted market prices which represent the net asset value of shares held.
|
|
Pension benefits
|
|
Other postretirement benefits
|
||||
Year ended December 31,
|
|
|
|
||||
2019
|
$
|
48.5
|
|
|
$
|
1.7
|
|
2020
|
49.7
|
|
|
1.6
|
|
||
2021
|
50.5
|
|
|
1.4
|
|
||
2022
|
51.0
|
|
|
1.4
|
|
||
2023
|
51.3
|
|
|
1.3
|
|
||
2024 through 2028
|
256.4
|
|
|
5.9
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Amounts recognized as a component of net periodic pension and other postretirement benefit cost:
|
|
|
|
|
|
||||||
Amortization of net loss
|
$
|
(19.3
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(21.9
|
)
|
Amortization and curtailment recognition of prior service credit
|
26.4
|
|
|
18.4
|
|
|
10.7
|
|
|||
Total before income taxes
|
7.1
|
|
|
(11.4
|
)
|
|
(11.2
|
)
|
|||
Income tax (expense) benefit
|
(1.5
|
)
|
|
—
|
|
|
3.8
|
|
|||
Total reclassifications for the period, net of income taxes
|
$
|
5.6
|
|
|
$
|
(11.4
|
)
|
|
$
|
(7.4
|
)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
||||||
U.S.
|
$
|
2.9
|
|
|
$
|
(14.9
|
)
|
|
$
|
10.0
|
|
Non - U.S.
|
13.6
|
|
|
16.8
|
|
|
32.9
|
|
|||
State
|
—
|
|
|
—
|
|
|
—
|
|
|||
Current expense (benefit)
|
16.5
|
|
|
1.9
|
|
|
42.9
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
U.S.
|
(69.8
|
)
|
|
(1.2
|
)
|
|
(20.9
|
)
|
|||
Non - U.S.
|
1.7
|
|
|
25.9
|
|
|
(17.0
|
)
|
|||
Deferred provision (benefit)
|
(68.1
|
)
|
|
24.7
|
|
|
(37.9
|
)
|
|||
Total provision (benefit)
|
$
|
(51.6
|
)
|
|
$
|
26.6
|
|
|
$
|
5.0
|
|
|
2018
|
|
2017
|
||||
Deferred tax assets:
|
|
|
|
||||
Accrued employee benefit plan costs
|
$
|
48.2
|
|
|
$
|
46.2
|
|
U.S. net operating loss
|
40.6
|
|
|
39.3
|
|
||
U.K. net operating loss
|
6.0
|
|
|
2.4
|
|
||
Trinidad net operating loss
|
5.2
|
|
|
5.9
|
|
||
Luxembourg net operating loss
|
1,249.4
|
|
|
1,163.2
|
|
||
Suriname net operating loss
|
3.9
|
|
|
3.9
|
|
||
Other NOLs and tax credit carryforwards
|
38.0
|
|
|
38.1
|
|
||
Other
|
18.6
|
|
|
16.3
|
|
||
Total deferred tax assets
|
1,409.9
|
|
|
1,315.3
|
|
||
Less: valuation allowance
|
(905.9
|
)
|
|
(869.9
|
)
|
||
Deferred tax assets, net of valuation allowance
|
504.0
|
|
|
445.4
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
|
|
||
Property and equipment
|
396.2
|
|
|
412.8
|
|
||
Other
|
12.3
|
|
|
11.9
|
|
||
Total deferred tax liabilities
|
408.5
|
|
|
424.7
|
|
||
Net deferred tax asset (liability)
|
$
|
95.5
|
|
|
$
|
20.7
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Gross unrecognized tax benefits - beginning of year
|
$
|
102.0
|
|
|
$
|
120.1
|
|
|
$
|
65.1
|
|
Gross increases - tax positions in prior period
|
1.1
|
|
|
1.4
|
|
|
46.2
|
|
|||
Gross decreases - tax positions in prior period
|
(0.3
|
)
|
|
(5.6
|
)
|
|
(0.6
|
)
|
|||
Gross increases - current period tax positions
|
3.2
|
|
|
3.1
|
|
|
10.9
|
|
|||
Settlements
|
—
|
|
|
(0.8
|
)
|
|
(1.5
|
)
|
|||
Lapse of statutes of limitation
|
(7.8
|
)
|
|
(16.2
|
)
|
|
—
|
|
|||
Gross unrecognized tax benefit - end of year
|
$
|
98.2
|
|
|
$
|
102.0
|
|
|
$
|
120.1
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
U.S.
|
$
|
(10.3
|
)
|
|
$
|
(63.7
|
)
|
|
$
|
(180.2
|
)
|
Non-U.S.
|
(388.7
|
)
|
|
163.0
|
|
|
505.8
|
|
|||
Total
|
$
|
(399.0
|
)
|
|
$
|
99.3
|
|
|
$
|
325.6
|
|
|
Years ended December 31,
|
||||||||||||||||||||||||||
|
Deepwater
|
|
Jack-ups
|
|
ARO
|
|
Unallocated and other
|
|
Reportable segments total
|
|
Eliminations and adjustments
|
|
Consolidated
|
||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenue
|
$
|
158.1
|
|
|
$
|
632.9
|
|
|
$
|
348.8
|
|
|
$
|
33.8
|
|
|
$
|
1,173.6
|
|
|
$
|
(348.8
|
)
|
|
$
|
824.8
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Direct operating costs (excluding items below)
|
168.6
|
|
|
514.1
|
|
|
194.0
|
|
|
—
|
|
|
876.7
|
|
|
(194.0
|
)
|
|
682.7
|
|
|||||||
Depreciation and amortization
|
108.5
|
|
|
278.3
|
|
|
67.4
|
|
|
2.1
|
|
|
456.3
|
|
|
(67.4
|
)
|
|
388.9
|
|
|||||||
Selling, general and administrative
|
—
|
|
|
—
|
|
|
27.0
|
|
|
96.1
|
|
|
123.1
|
|
|
(27.0
|
)
|
|
96.1
|
|
|||||||
Gain on sale of assets to unconsolidated subsidiary
|
—
|
|
|
(65.8
|
)
|
|
—
|
|
|
—
|
|
|
(65.8
|
)
|
|
—
|
|
|
(65.8
|
)
|
|||||||
Other operating items - expense
|
1.6
|
|
|
5.3
|
|
|
1.4
|
|
|
5.2
|
|
|
13.5
|
|
|
(1.4
|
)
|
|
12.1
|
|
|||||||
Merger and related costs
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
|
8.9
|
|
|
—
|
|
|
8.9
|
|
|||||||
Equity in earnings of unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.3
|
|
|
10.3
|
|
|||||||
Income (loss) from operations
|
$
|
(120.6
|
)
|
|
$
|
(99.0
|
)
|
|
$
|
59.0
|
|
|
$
|
(78.5
|
)
|
|
$
|
(239.1
|
)
|
|
$
|
(48.7
|
)
|
|
$
|
(287.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenue
|
$
|
467.9
|
|
|
$
|
807.5
|
|
|
$
|
48.6
|
|
|
$
|
7.4
|
|
|
$
|
1,331.4
|
|
|
$
|
(48.6
|
)
|
|
$
|
1,282.8
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Direct operating costs (excluding items below)
|
151.4
|
|
|
533.6
|
|
|
22.2
|
|
|
—
|
|
|
707.2
|
|
|
(22.2
|
)
|
|
685.0
|
|
|||||||
Depreciation and amortization
|
111.6
|
|
|
289.4
|
|
|
12.9
|
|
|
2.7
|
|
|
416.6
|
|
|
(12.9
|
)
|
|
403.7
|
|
|||||||
Selling, general and administrative
|
—
|
|
|
—
|
|
|
6.1
|
|
|
104.6
|
|
|
110.7
|
|
|
(6.1
|
)
|
|
104.6
|
|
|||||||
Gain on sale of assets to unconsolidated subsidiary
|
—
|
|
|
(157.4
|
)
|
|
—
|
|
|
—
|
|
|
(157.4
|
)
|
|
—
|
|
|
(157.4
|
)
|
|||||||
Other operating items - (income) expense
|
0.1
|
|
|
9.3
|
|
|
(0.1
|
)
|
|
—
|
|
|
9.3
|
|
|
0.1
|
|
|
9.4
|
|
|||||||
Equity in earnings of unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.9
|
|
|
0.9
|
|
|||||||
Income (loss) from operations
|
$
|
204.8
|
|
|
$
|
132.6
|
|
|
$
|
7.5
|
|
|
$
|
(99.9
|
)
|
|
$
|
245.0
|
|
|
$
|
(6.6
|
)
|
|
$
|
238.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenue
|
$
|
827.5
|
|
|
$
|
1,015.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,843.2
|
|
|
$
|
—
|
|
|
$
|
1,843.2
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Direct operating costs (excluding items below)
|
222.4
|
|
|
557.3
|
|
|
—
|
|
|
—
|
|
|
779.7
|
|
|
—
|
|
|
779.7
|
|
|||||||
Depreciation and amortization
|
115.0
|
|
|
282.6
|
|
|
—
|
|
|
5.3
|
|
|
402.9
|
|
|
—
|
|
|
402.9
|
|
|||||||
Selling, general and administrative
|
—
|
|
|
—
|
|
|
—
|
|
|
102.2
|
|
|
102.2
|
|
|
—
|
|
|
102.2
|
|
|||||||
Other operating items - expense
|
0.1
|
|
|
40.9
|
|
|
—
|
|
|
0.6
|
|
|
41.6
|
|
|
—
|
|
|
41.6
|
|
|||||||
Income (loss) from operations
|
$
|
490.0
|
|
|
$
|
134.9
|
|
|
$
|
—
|
|
|
$
|
(108.1
|
)
|
|
$
|
516.8
|
|
|
$
|
—
|
|
|
$
|
516.8
|
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Capital expenditures:
|
(In millions)
|
||||||||||
Deepwater
|
$
|
16.7
|
|
|
$
|
8.3
|
|
|
$
|
31.5
|
|
Jack-ups
|
145.8
|
|
|
86.4
|
|
|
84.3
|
|
|||
Unallocated and other
|
6.7
|
|
|
5.9
|
|
|
1.8
|
|
|||
Total
|
$
|
169.2
|
|
|
$
|
100.6
|
|
|
$
|
117.6
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Total assets:
|
(In millions)
|
||||||
Deepwater
|
$
|
2,757.9
|
|
|
$
|
2,857.6
|
|
Jack-ups
|
4,153.8
|
|
|
4,173.7
|
|
||
Unallocated and other
|
1,206.0
|
|
|
1,427.0
|
|
||
Total
|
$
|
8,117.7
|
|
|
$
|
8,458.3
|
|
|
Years ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Unallocated and Other Revenue:
|
|
|
|
|
|
||||||
Saudi Arabia
|
$
|
33.8
|
|
|
$
|
7.4
|
|
|
$
|
—
|
|
Total
|
$
|
33.8
|
|
|
$
|
7.4
|
|
|
$
|
—
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Accrued but unpaid additions to property and equipment at December 31
|
$
|
42.2
|
|
|
$
|
21.4
|
|
|
$
|
21.0
|
|
Cash interest payments
|
153.9
|
|
|
150.2
|
|
|
159.2
|
|
|||
Income tax payments (refunds), net
|
33.1
|
|
|
30.0
|
|
|
38.1
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
REVENUE
|
$
|
—
|
|
|
$
|
4.9
|
|
|
$
|
824.8
|
|
|
$
|
(4.9
|
)
|
|
$
|
824.8
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct operating costs (excluding items below)
|
—
|
|
|
—
|
|
|
682.7
|
|
|
—
|
|
|
682.7
|
|
|||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
388.9
|
|
|
—
|
|
|
388.9
|
|
|||||
Selling, general and administrative
|
25.7
|
|
|
0.6
|
|
|
74.7
|
|
|
(4.9
|
)
|
|
96.1
|
|
|||||
Gain on sale of assets to unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
(65.8
|
)
|
|
—
|
|
|
(65.8
|
)
|
|||||
Loss on disposals of property and equipment
|
—
|
|
|
3.7
|
|
|
8.4
|
|
|
—
|
|
|
12.1
|
|
|||||
Merger and related costs
|
8.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
|||||
Total costs and expenses
|
34.6
|
|
|
4.3
|
|
|
1,088.9
|
|
|
(4.9
|
)
|
|
1,122.9
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity in earnings of unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
10.3
|
|
|
—
|
|
|
10.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) FROM OPERATIONS
|
(34.6
|
)
|
|
0.6
|
|
|
(253.8
|
)
|
|
—
|
|
|
(287.8
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense
|
—
|
|
|
(151.0
|
)
|
|
(7.2
|
)
|
|
1.9
|
|
|
(156.3
|
)
|
|||||
Interest income
|
—
|
|
|
3.7
|
|
|
31.3
|
|
|
(1.9
|
)
|
|
33.1
|
|
|||||
Other - net
|
4.9
|
|
|
(1.7
|
)
|
|
8.8
|
|
|
—
|
|
|
12.0
|
|
|||||
Total other income (expense) - net
|
4.9
|
|
|
(149.0
|
)
|
|
32.9
|
|
|
—
|
|
|
(111.2
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
LOSS BEFORE INCOME TAXES
|
(29.7
|
)
|
|
(148.4
|
)
|
|
(220.9
|
)
|
|
—
|
|
|
(399.0
|
)
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(87.6
|
)
|
|
36.0
|
|
|
—
|
|
|
(51.6
|
)
|
|||||
Equity in earnings (losses) of consolidated subsidiaries, net of tax
|
(317.7
|
)
|
|
162.7
|
|
|
—
|
|
|
155.0
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME (LOSS)
|
$
|
(347.4
|
)
|
|
$
|
101.9
|
|
|
$
|
(256.9
|
)
|
|
$
|
155.0
|
|
|
$
|
(347.4
|
)
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
REVENUE
|
$
|
—
|
|
|
$
|
48.7
|
|
|
$
|
1,283.2
|
|
|
$
|
(49.1
|
)
|
|
$
|
1,282.8
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct operating costs (excluding items below)
|
—
|
|
|
0.5
|
|
|
727.5
|
|
|
(43.0
|
)
|
|
685.0
|
|
|||||
Depreciation and amortization
|
—
|
|
|
18.3
|
|
|
385.4
|
|
|
—
|
|
|
403.7
|
|
|||||
Selling, general and administrative
|
29.2
|
|
|
0.2
|
|
|
81.3
|
|
|
(6.1
|
)
|
|
104.6
|
|
|||||
Gain on sale of assets to unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
(157.4
|
)
|
|
—
|
|
|
(157.4
|
)
|
|||||
Loss on disposals of property and equipment
|
—
|
|
|
1.7
|
|
|
7.7
|
|
|
—
|
|
|
9.4
|
|
|||||
Total costs and expenses
|
29.2
|
|
|
20.7
|
|
|
1,044.5
|
|
|
(49.1
|
)
|
|
1,045.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity in earnings of unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
0.9
|
|
|
—
|
|
|
0.9
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) FROM OPERATIONS
|
(29.2
|
)
|
|
28.0
|
|
|
239.6
|
|
|
—
|
|
|
238.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense
|
—
|
|
|
(155.8
|
)
|
|
(0.5
|
)
|
|
0.6
|
|
|
(155.7
|
)
|
|||||
Interest income
|
—
|
|
|
3.6
|
|
|
12.4
|
|
|
(0.6
|
)
|
|
15.4
|
|
|||||
Gain on extinguishment of debt
|
—
|
|
|
1.7
|
|
|
—
|
|
|
—
|
|
|
1.7
|
|
|||||
Other - net
|
20.4
|
|
|
(20.7
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
(0.5
|
)
|
|||||
Total other income (expense) - net
|
20.4
|
|
|
(171.2
|
)
|
|
11.7
|
|
|
—
|
|
|
(139.1
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) BEFORE INCOME TAXES
|
(8.8
|
)
|
|
(143.2
|
)
|
|
251.3
|
|
|
—
|
|
|
99.3
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
(8.2
|
)
|
|
34.8
|
|
|
—
|
|
|
26.6
|
|
|||||
Equity in earnings of consolidated subsidiaries, net of tax
|
81.5
|
|
|
209.4
|
|
|
—
|
|
|
(290.9
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME
|
$
|
72.7
|
|
|
$
|
74.4
|
|
|
$
|
216.5
|
|
|
$
|
(290.9
|
)
|
|
$
|
72.7
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
REVENUE
|
$
|
—
|
|
|
$
|
40.4
|
|
|
$
|
1,836.9
|
|
|
$
|
(34.1
|
)
|
|
$
|
1,843.2
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Direct operating costs (excluding items below)
|
—
|
|
|
12.4
|
|
|
796.4
|
|
|
(29.1
|
)
|
|
779.7
|
|
|||||
Depreciation and amortization
|
—
|
|
|
19.2
|
|
|
382.7
|
|
|
1.0
|
|
|
402.9
|
|
|||||
Selling, general and administrative
|
28.5
|
|
|
5.5
|
|
|
74.2
|
|
|
(6.0
|
)
|
|
102.2
|
|
|||||
Loss on disposals of property and equipment
|
—
|
|
|
0.9
|
|
|
7.8
|
|
|
—
|
|
|
8.7
|
|
|||||
Material charges and other operating items
|
—
|
|
|
—
|
|
|
32.9
|
|
|
—
|
|
|
32.9
|
|
|||||
Total costs and expenses
|
28.5
|
|
|
38.0
|
|
|
1,294.0
|
|
|
(34.1
|
)
|
|
1,326.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) FROM OPERATIONS
|
(28.5
|
)
|
|
2.4
|
|
|
542.9
|
|
|
—
|
|
|
516.8
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense
|
—
|
|
|
(155.5
|
)
|
|
(4.1
|
)
|
|
4.1
|
|
|
(155.5
|
)
|
|||||
Interest income
|
—
|
|
|
5.1
|
|
|
2.8
|
|
|
(4.1
|
)
|
|
3.8
|
|
|||||
Loss on extinguishment of debt
|
—
|
|
|
(31.2
|
)
|
|
—
|
|
|
—
|
|
|
(31.2
|
)
|
|||||
Other - net
|
21.2
|
|
|
(20.9
|
)
|
|
(8.6
|
)
|
|
—
|
|
|
(8.3
|
)
|
|||||
Total other income (expense) - net
|
21.2
|
|
|
(202.5
|
)
|
|
(9.9
|
)
|
|
—
|
|
|
(191.2
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) BEFORE INCOME TAXES
|
(7.3
|
)
|
|
(200.1
|
)
|
|
533.0
|
|
|
—
|
|
|
325.6
|
|
|||||
Provision (benefit) for income taxes
|
—
|
|
|
5.1
|
|
|
(6.7
|
)
|
|
6.6
|
|
|
5.0
|
|
|||||
Equity in earnings of consolidated subsidiaries, net of tax
|
327.9
|
|
|
7.8
|
|
|
—
|
|
|
(335.7
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME (LOSS)
|
$
|
320.6
|
|
|
$
|
(197.4
|
)
|
|
$
|
539.7
|
|
|
$
|
(342.3
|
)
|
|
$
|
320.6
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
NET INCOME (LOSS)
|
$
|
(347.4
|
)
|
|
$
|
101.9
|
|
|
$
|
(256.9
|
)
|
|
$
|
155.0
|
|
|
$
|
(347.4
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER COMPREHENSIVE LOSS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes
|
(17.9
|
)
|
|
(17.9
|
)
|
|
—
|
|
|
17.9
|
|
|
(17.9
|
)
|
|||||
Net reclassification adjustment for amounts recognized in net income (loss) as a component of net periodic benefit cost, net of income taxes
|
(5.6
|
)
|
|
(5.6
|
)
|
|
—
|
|
|
5.6
|
|
|
(5.6
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(23.5
|
)
|
|
(23.5
|
)
|
|
—
|
|
|
23.5
|
|
|
(23.5
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
(370.9
|
)
|
|
$
|
78.4
|
|
|
$
|
(256.9
|
)
|
|
$
|
178.5
|
|
|
$
|
(370.9
|
)
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
NET INCOME
|
$
|
72.7
|
|
|
$
|
74.4
|
|
|
$
|
216.5
|
|
|
$
|
(290.9
|
)
|
|
$
|
72.7
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER COMPREHENSIVE LOSS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes
|
(33.3
|
)
|
|
(33.3
|
)
|
|
—
|
|
|
33.3
|
|
|
(33.3
|
)
|
|||||
Net reclassification adjustment for amounts recognized in net income as a component of net periodic benefit cost, net of income taxes
|
11.4
|
|
|
11.4
|
|
|
—
|
|
|
(11.4
|
)
|
|
11.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(21.9
|
)
|
|
(21.9
|
)
|
|
—
|
|
|
21.9
|
|
|
(21.9
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
COMPREHENSIVE INCOME
|
$
|
50.8
|
|
|
$
|
52.5
|
|
|
$
|
216.5
|
|
|
$
|
(269.0
|
)
|
|
$
|
50.8
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
NET INCOME (LOSS)
|
$
|
320.6
|
|
|
$
|
(197.4
|
)
|
|
$
|
539.7
|
|
|
$
|
(342.3
|
)
|
|
$
|
320.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER COMPREHENSIVE INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes
|
(5.1
|
)
|
|
(5.1
|
)
|
|
—
|
|
|
5.1
|
|
|
(5.1
|
)
|
|||||
Net reclassification adjustment for amounts recognized in net income (loss) as a component of net periodic benefit cost, net of income taxes
|
7.4
|
|
|
7.4
|
|
|
—
|
|
|
(7.4
|
)
|
|
7.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
2.3
|
|
|
2.3
|
|
|
—
|
|
|
(2.3
|
)
|
|
2.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
322.9
|
|
|
$
|
(195.1
|
)
|
|
$
|
539.7
|
|
|
$
|
(344.6
|
)
|
|
$
|
322.9
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
2.5
|
|
|
$
|
324.6
|
|
|
$
|
699.6
|
|
|
$
|
—
|
|
|
$
|
1,026.7
|
|
Receivables - trade and other
|
0.2
|
|
|
2.6
|
|
|
248.4
|
|
|
—
|
|
|
251.2
|
|
|||||
Prepaid expenses and other current assets
|
0.4
|
|
|
8.3
|
|
|
13.7
|
|
|
—
|
|
|
22.4
|
|
|||||
Total current assets
|
3.1
|
|
|
335.5
|
|
|
961.7
|
|
|
—
|
|
|
1,300.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment - gross
|
—
|
|
|
247.3
|
|
|
8,405.1
|
|
|
—
|
|
|
8,652.4
|
|
|||||
Less accumulated depreciation and amortization
|
—
|
|
|
138.0
|
|
|
2,313.4
|
|
|
—
|
|
|
2,451.4
|
|
|||||
Property and equipment - net
|
—
|
|
|
109.3
|
|
|
6,091.7
|
|
|
—
|
|
|
6,201.0
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in consolidated subsidiaries
|
5,068.3
|
|
|
1,596.4
|
|
|
—
|
|
|
(6,664.7
|
)
|
|
—
|
|
|||||
Due from affiliates
|
0.1
|
|
|
5,357.4
|
|
|
14.1
|
|
|
(5,371.6
|
)
|
|
—
|
|
|||||
Long-term note receivable from unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
456.0
|
|
|
—
|
|
|
456.0
|
|
|||||
Investment in unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
41.2
|
|
|
—
|
|
|
41.2
|
|
|||||
Other assets
|
—
|
|
|
109.6
|
|
|
9.6
|
|
|
—
|
|
|
119.2
|
|
|||||
|
$
|
5,071.5
|
|
|
$
|
7,508.2
|
|
|
$
|
7,574.3
|
|
|
$
|
(12,036.3
|
)
|
|
$
|
8,117.7
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current portion of long-term debt
|
$
|
—
|
|
|
$
|
201.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
201.2
|
|
Accounts payable - trade
|
4.3
|
|
|
10.2
|
|
|
107.8
|
|
|
—
|
|
|
122.3
|
|
|||||
Deferred revenue
|
—
|
|
|
—
|
|
|
16.7
|
|
|
—
|
|
|
16.7
|
|
|||||
Accrued liabilities
|
1.2
|
|
|
76.5
|
|
|
35.7
|
|
|
—
|
|
|
113.4
|
|
|||||
Total current liabilities
|
5.5
|
|
|
287.9
|
|
|
160.2
|
|
|
—
|
|
|
453.6
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
—
|
|
|
2,309.7
|
|
|
—
|
|
|
—
|
|
|
2,309.7
|
|
|||||
Due to affiliates
|
28.7
|
|
|
8.6
|
|
|
5,334.3
|
|
|
(5,371.6
|
)
|
|
—
|
|
|||||
Other liabilities
|
2.3
|
|
|
264.3
|
|
|
41.1
|
|
|
—
|
|
|
307.7
|
|
|||||
Deferred income taxes - net
|
—
|
|
|
—
|
|
|
11.7
|
|
|
—
|
|
|
11.7
|
|
|||||
Shareholders' equity
|
5,035.0
|
|
|
4,637.7
|
|
|
2,027.0
|
|
|
(6,664.7
|
)
|
|
5,035.0
|
|
|||||
|
$
|
5,071.5
|
|
|
$
|
7,508.2
|
|
|
$
|
7,574.3
|
|
|
$
|
(12,036.3
|
)
|
|
$
|
8,117.7
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
0.2
|
|
|
$
|
206.3
|
|
|
$
|
1,125.6
|
|
|
$
|
—
|
|
|
$
|
1,332.1
|
|
Receivables - trade and other
|
—
|
|
|
1.2
|
|
|
211.6
|
|
|
—
|
|
|
212.8
|
|
|||||
Prepaid expenses and other current assets
|
0.3
|
|
|
10.7
|
|
|
4.5
|
|
|
—
|
|
|
15.5
|
|
|||||
Total current assets
|
0.5
|
|
|
218.2
|
|
|
1,341.7
|
|
|
—
|
|
|
1,560.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Property and equipment - gross
|
—
|
|
|
241.9
|
|
|
8,592.0
|
|
|
—
|
|
|
8,833.9
|
|
|||||
Less accumulated depreciation and amortization
|
—
|
|
|
121.4
|
|
|
2,159.8
|
|
|
—
|
|
|
2,281.2
|
|
|||||
Property and equipment - net
|
—
|
|
|
120.5
|
|
|
6,432.2
|
|
|
—
|
|
|
6,552.7
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in consolidated subsidiaries
|
5,401.1
|
|
|
6,387.1
|
|
|
—
|
|
|
(11,788.2
|
)
|
|
—
|
|
|||||
Due from affiliates
|
0.2
|
|
|
680.0
|
|
|
11.5
|
|
|
(691.7
|
)
|
|
—
|
|
|||||
Long-term note receivable from unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
270.2
|
|
|
—
|
|
|
270.2
|
|
|||||
Investment in unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
30.9
|
|
|
—
|
|
|
30.9
|
|
|||||
Other assets
|
—
|
|
|
36.4
|
|
|
7.7
|
|
|
—
|
|
|
44.1
|
|
|||||
|
$
|
5,401.8
|
|
|
$
|
7,442.2
|
|
|
$
|
8,094.2
|
|
|
$
|
(12,479.9
|
)
|
|
$
|
8,458.3
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable - trade
|
$
|
0.7
|
|
|
$
|
12.9
|
|
|
$
|
83.6
|
|
|
$
|
—
|
|
|
$
|
97.2
|
|
Deferred revenue
|
—
|
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
1.1
|
|
|||||
Accrued liabilities
|
—
|
|
|
95.7
|
|
|
63.4
|
|
|
—
|
|
|
159.1
|
|
|||||
Total current liabilities
|
0.7
|
|
|
108.6
|
|
|
148.1
|
|
|
—
|
|
|
257.4
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt, less current portion
|
—
|
|
|
2,510.3
|
|
|
—
|
|
|
—
|
|
|
2,510.3
|
|
|||||
Due to affiliates
|
11.2
|
|
|
11.4
|
|
|
669.1
|
|
|
(691.7
|
)
|
|
—
|
|
|||||
Other liabilities
|
3.8
|
|
|
261.2
|
|
|
28.6
|
|
|
—
|
|
|
293.6
|
|
|||||
Deferred income taxes - net
|
—
|
|
|
—
|
|
|
10.9
|
|
|
—
|
|
|
10.9
|
|
|||||
Shareholders' equity
|
5,386.1
|
|
|
4,550.7
|
|
|
7,237.5
|
|
|
(11,788.2
|
)
|
|
5,386.1
|
|
|||||
|
$
|
5,401.8
|
|
|
$
|
7,442.2
|
|
|
$
|
8,094.2
|
|
|
$
|
(12,479.9
|
)
|
|
$
|
8,458.3
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATIING ACTIVITIES
|
$
|
(10.0
|
)
|
|
$
|
(11.3
|
)
|
|
$
|
336.2
|
|
|
$
|
(15.1
|
)
|
|
$
|
299.8
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Capital expenditures
|
—
|
|
|
(18.3
|
)
|
|
(82.3
|
)
|
|
—
|
|
|
(100.6
|
)
|
|||||
Deposit on purchase of rigs
|
—
|
|
|
—
|
|
|
(7.7
|
)
|
|
—
|
|
|
(7.7
|
)
|
|||||
Investment in unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
(30.0
|
)
|
|
—
|
|
|
(30.0
|
)
|
|||||
Contributions to unconsolidated subsidiary for note receivable
|
—
|
|
|
—
|
|
|
(357.7
|
)
|
|
—
|
|
|
(357.7
|
)
|
|||||
Proceeds from sale of assets to unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
357.7
|
|
|
—
|
|
|
357.7
|
|
|||||
Repayments of note receivable from unconsolidated subsidiary
|
—
|
|
|
—
|
|
|
87.5
|
|
|
—
|
|
|
87.5
|
|
|||||
Proceeds from disposals of property and equipment
|
—
|
|
|
1.0
|
|
|
2.3
|
|
|
—
|
|
|
3.3
|
|
|||||
Investments in consolidated subsidiaries
|
—
|
|
|
32.6
|
|
|
—
|
|
|
(32.6
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) investing activities
|
—
|
|
|
15.3
|
|
|
(30.2
|
)
|
|
(32.6
|
)
|
|
(47.5
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH FLOWS FROM FINANCING ACTIVITES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Advances (to) from affiliates
|
12.2
|
|
|
(159.7
|
)
|
|
147.5
|
|
|
—
|
|
|
—
|
|
|||||
Distributions to issuer
|
—
|
|
|
—
|
|
|
(32.6
|
)
|
|
32.6
|
|
|
—
|
|
|||||
Reductions of long-term debt
|
—
|
|
|
(170.0
|
)
|
|
—
|
|
|
—
|
|
|
(170.0
|
)
|
|||||
Dividends paid
|
—
|
|
|
—
|
|
|
(15.1
|
)
|
|
15.1
|
|
|
—
|
|
|||||
Shares repurchased for tax withholdings on vesting of restricted share units
|
(5.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.7
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) financing activities
|
6.5
|
|
|
(329.7
|
)
|
|
99.8
|
|
|
47.7
|
|
|
(175.7
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(3.5
|
)
|
|
(325.7
|
)
|
|
405.8
|
|
|
—
|
|
|
76.6
|
|
|||||
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD |
3.7
|
|
|
532.0
|
|
|
719.8
|
|
|
—
|
|
|
1,255.5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH AND CASH EQUIVALENTS,
END OF PERIOD |
$
|
0.2
|
|
|
$
|
206.3
|
|
|
$
|
1,125.6
|
|
|
$
|
—
|
|
|
$
|
1,332.1
|
|
|
Rowan plc (Parent)
|
|
RCI (Issuer)
|
|
Non-guarantor subsidiaries
|
|
Consolidating adjustments
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
$
|
(6.4
|
)
|
|
$
|
(58.8
|
)
|
|
$
|
1,101.3
|
|
|
$
|
(106.5
|
)
|
|
$
|
929.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Capital expenditures
|
—
|
|
|
(44.5
|
)
|
|
(73.1
|
)
|
|
—
|
|
|
(117.6
|
)
|
|||||
Proceeds from disposals of property and equipment
|
—
|
|
|
0.4
|
|
|
5.8
|
|
|
—
|
|
|
6.2
|
|
|||||
Collections on note receivable from consolidated subsidiary
|
—
|
|
|
689.7
|
|
|
—
|
|
|
(689.7
|
)
|
|
—
|
|
|||||
Investments in consolidated subsidiaries
|
(0.2
|
)
|
|
(80.6
|
)
|
|
—
|
|
|
80.8
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) investing activities
|
(0.2
|
)
|
|
565.0
|
|
|
(67.3
|
)
|
|
(608.9
|
)
|
|
(111.4
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Advances (to) from affiliates
|
(2.0
|
)
|
|
58.2
|
|
|
(53.0
|
)
|
|
(3.2
|
)
|
|
—
|
|
|||||
Contributions from parent/issuer
|
—
|
|
|
—
|
|
|
80.8
|
|
|
(80.8
|
)
|
|
—
|
|
|||||
Proceeds from borrowings
|
—
|
|
|
500.0
|
|
|
—
|
|
|
—
|
|
|
500.0
|
|
|||||
Reductions of long-term debt
|
—
|
|
|
(511.8
|
)
|
|
(689.7
|
)
|
|
689.7
|
|
|
(511.8
|
)
|
|||||
Payment of debt extinguishment costs
|
—
|
|
|
(24.0
|
)
|
|
—
|
|
|
—
|
|
|
(24.0
|
)
|
|||||
Dividends paid
|
—
|
|
|
—
|
|
|
(109.7
|
)
|
|
109.7
|
|
|
—
|
|
|||||
Debt issue costs
|
—
|
|
|
(8.7
|
)
|
|
—
|
|
|
—
|
|
|
(8.7
|
)
|
|||||
Shares repurchased for tax withholdings on vesting of restricted share units
|
(5.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.0
|
)
|
|||||
Excess tax benefits from share-based compensation
|
—
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) financing activities
|
(7.0
|
)
|
|
16.3
|
|
|
(771.6
|
)
|
|
715.4
|
|
|
(46.9
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(13.6
|
)
|
|
522.5
|
|
|
262.4
|
|
|
—
|
|
|
771.3
|
|
|||||
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD |
17.3
|
|
|
9.5
|
|
|
457.4
|
|
|
—
|
|
|
484.2
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
CASH AND CASH EQUIVALENTS,
END OF PERIOD |
$
|
3.7
|
|
|
$
|
532.0
|
|
|
$
|
719.8
|
|
|
$
|
—
|
|
|
$
|
1,255.5
|
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
2018:
|
|
|
|
|
|
|
|
|
||||||||
Revenue
|
|
$
|
211.2
|
|
|
$
|
241.3
|
|
|
$
|
192.9
|
|
|
$
|
179.4
|
|
Loss from operations
|
|
(72.3
|
)
|
|
(58.2
|
)
|
|
(113.4
|
)
|
|
(43.9
|
)
|
||||
Net loss
|
|
(112.3
|
)
|
|
(76.7
|
)
|
|
(144.1
|
)
|
|
(14.3
|
)
|
||||
Basic and diluted loss per share
|
|
(0.89
|
)
|
|
(0.60
|
)
|
|
(1.13
|
)
|
|
(0.11
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenue
|
|
$
|
374.3
|
|
|
$
|
320.2
|
|
|
$
|
291.6
|
|
|
$
|
296.7
|
|
Income (loss) from operations
|
|
76.3
|
|
|
24.6
|
|
|
(8.2
|
)
|
|
145.7
|
|
||||
Net income (loss)
|
|
10.3
|
|
|
(28.7
|
)
|
|
(20.9
|
)
|
|
112.0
|
|
||||
Basic earnings (loss) per share
|
|
0.08
|
|
|
(0.23
|
)
|
|
(0.17
|
)
|
|
0.89
|
|
||||
Diluted earnings (loss) per share
|
|
0.07
|
|
|
(0.23
|
)
|
|
(0.17
|
)
|
|
0.89
|
|
Name
|
Position
|
Age
|
Thomas P. Burke
|
President and Chief Executive Officer
|
51
|
Stephen M. Butz
|
Executive Vice President and Chief Financial Officer
|
47
|
Mark Mai
|
Executive Vice President, General Counsel and Company Secretary
|
58
|
Dennis Baldwin
|
Chief Accounting Officer
|
58
|
T. Fred Brooks
|
Executive Vice President, Operations and Engineering
|
61
|
Alan Quintero
|
Senior Vice President, Business Development
|
55
|
Kelly McHenry
|
Chief Executive Officer, ARO
|
47
|
Jason Anderson
|
Vice President, Human Resources
|
43
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(1)
(a)
|
Weighted-average exercise price of outstanding options, warrants and rights
(2)
(b)
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(c)
|
|
Equity compensation plans approved by security holders
|
354,946
|
$17.59
|
7,075,015
|
|
Equity compensation plans not approved by security holders
|
—
|
—
|
—
|
|
Total
|
354,946
|
$17.59
|
7,075,015
|
(1)
|
The number of securities to be issued includes (i) 354,946 options and no shares issuable under outstanding SARs (see note (2) below).
|
(2)
|
The weighted-average exercise price in column (b) is based on (i) 354,946 shares under outstanding options with a weighted average exercise price of
$17.59
per share, and (ii) no shares of stock that would be issuable in connection with 1,011,639 SARs outstanding at
December 31, 2018
. The number of shares issuable under SARs is equal in value to the excess of the Company’s share price on the date of exercise over the exercise price. The number of shares issuable under SARs included in column (a) was based on a
December 31, 2018
closing stock price of $8.39 and a weighted-average exercise price of
$30.93
per share.
|
²
101.INS
|
|
XBRL Instance Document.
|
²
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
²
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
²
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
²
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
²
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
*
|
Executive compensatory plan or arrangement.
|
²
|
Filed herewith.
|
v
|
Confidential Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to this omitted information.
|
ª
|
Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant agrees to furnish supplementally a copy of the omitted schedules and exhibits to the Securities and Exchange Commission upon request.
|
|
ROWAN COMPANIES PLC
|
|
(Registrant)
|
|
|
|
By: /s/ THOMAS P. BURKE
|
|
Thomas P. Burke
|
|
President and Chief Executive Officer
|
|
|
|
Date: February 27, 2019
|
Signature
|
Title
|
Date
|
|
|
|
/s/ THOMAS P. BURKE
|
President and Chief Executive Officer and Director (Principal Executive Officer)
|
February 27, 2019
|
(Thomas P. Burke)
|
|
|
|
|
|
/s/ STEPHEN M. BUTZ
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
February 27, 2019
|
(Stephen M. Butz)
|
|
|
|
|
|
/s/ DENNIS S. BALDWIN
|
Chief Accounting Officer (Principal Accounting Officer)
|
February 27, 2019
|
(Dennis S. Baldwin)
|
|
|
|
|
|
/s/ WILLIAM E. ALBRECHT
|
Chairman of the Board
|
February 27, 2019
|
(William E. Albrecht)
|
|
|
|
|
|
/s/ THOMAS R. HIX
|
Director
|
February 27, 2019
|
(Thomas R. Hix)
|
|
|
|
|
|
/s/ JACK B. MOORE
|
Director
|
February 27, 2019
|
(Jack B. Moore)
|
|
|
|
|
|
/s/ SUZANNE P. NIMOCKS
|
Director
|
February 27, 2019
|
(Suzanne P. Nimocks)
|
|
|
|
|
|
/s/ THIERRY PILENKO
|
Director
|
February 27, 2019
|
(Thierry Pilenko)
|
|
|
|
|
|
/s/ JOHN J. QUICKE
|
Director
|
February 27, 2019
|
(John J. Quicke)
|
|
|
|
|
|
/s/ TORE I. SANDVOLD
|
Director
|
February 27, 2019
|
(Tore I. Sandvold)
|
|
|
|
|
|
/s/ CHARLES L. SZEWS
|
Director
|
February 27, 2019
|
(Charles L. Szews)
|
|
|
Company Name
|
Jurisdiction(s)
|
Atlantic Maritime Services LLC (fka Atlantic Maritime Services, Inc.)
|
Delaware
|
British American Offshore Limited
|
England & Wales
|
Great White Shark Limited
|
Gibraltar
|
Green Turtle Limited
|
Gibraltar
|
Manatee Limited
|
Malta
|
Manta Ray Limited
|
Malta
|
Marine Blue Limited
|
Gibraltar
|
Ralph Coffman Cayman Limited (fka Rowan S116E#3, Inc.)
|
Cayman Islands
|
Ralph Coffman Limited
|
Gibraltar
|
Ralph Coffman Luxembourg S.à r.l. (fka Rowan Financement S.à r.l.)
|
Luxembourg
|
RCI International, Inc.
|
Cayman Islands
|
RD International Services Pte. Ltd.
|
Singapore
|
RDC Arabia Drilling, Inc.
|
Cayman Islands
|
RDC Holdings Luxembourg S.à r.l.
|
Luxembourg
|
RDC Malta Limited (fka RDC (Gibraltar) Limited)
|
Malta
|
RDC Offshore Luxembourg S.à r.l.
|
Luxembourg
|
RDC Offshore Malta Limited (fka RDC Offshore (Gibraltar) Limited)
|
Malta
|
RoCal Cayman Limited (fka RCI Drilling International, Inc.)
|
Cayman Islands
|
Rowan 240C#3, Inc.
|
Cayman Islands
|
Rowan 350 Slot Rigs, Inc. (fka RDC Qatar, Inc.)
|
Delaware
|
Rowan Angola Limitada
|
Angola
|
Rowan Austria GmbH
|
Austria
|
Rowan California S.à r.l.
|
Luxembourg
|
Rowan Cayman Limited
|
Cayman Islands
|
Rowan Companies, Inc.
|
Delaware
|
Rowan Deepwater Drilling (Gibraltar) Limited
|
Gibraltar
|
Rowan do Brasil Servicos de Perfuraçao Ltda.
|
Brazil
|
Rowan Drilling Cyprus Limited
|
Cyprus
|
Rowan Drilling (Gibraltar) Limited
|
Gibraltar
|
Rowan Drilling (Trinidad) Limited
|
Cayman Islands
|
Rowan Drilling, S. de R.L. de C.V.
|
Mexico
|
Rowan Drilling Services Limited (fka Rowan Labor (Gibraltar) Limited)
|
Gibraltar
|
Rowan Drilling Services Nigeria Limited
|
Nigeria
|
Rowan Drilling (U.K.) Limited
|
Scotland
|
Rowan Egypt Petroleum Services L.L.C.
|
Egypt
|
Rowan Finance LLC
|
Delaware
|
Rowan Financial Holdings S.à r.l.
|
Luxembourg
|
Rowan Finanz S.à r.l.
|
Luxembourg
|
Rowan Global Drilling Services Limited
|
Gibraltar
|
Rowan Gorilla V (Gibraltar) Limited
|
Gibraltar
|
Rowan Gorilla VII (Gibraltar) Limited
|
Gibraltar
|
Company Name
|
Jurisdiction(s)
|
Rowan Holdings Luxembourg S.à r.l.
|
Luxembourg
|
Rowan International Rig Holdings S.à r.l.
|
Luxembourg
|
Rowan Marine Services, Inc.
|
Texas
|
Rowan Middle East, Inc.
|
Cayman Islands
|
Rowan N-Class (Gibraltar) Limited
|
Gibraltar
|
Rowan No. 1 Limited
|
England & Wales
|
Rowan No. 2 Limited
|
England & Wales
|
Rowan North Sea, Inc.
|
Cayman Islands
|
Rowan Norway Limited (fka Rowan (Gibraltar) Limited)
|
Gibraltar
|
Rowan Offshore (Gibraltar) Limited
|
Gibraltar
|
Rowan Offshore Luxembourg S.à r.l.
|
Luxembourg
|
Rowan Relentless Limited
|
Gibraltar
|
Rowan Relentless Luxembourg S.à r.l. (fka Rowan Finanzeieren S.à r.l.)
|
Luxembourg
|
Rowan Reliance Limited
|
Gibraltar
|
Rowan Reliance Luxembourg S.à r.l.
|
Luxembourg
|
Rowan Resolute Limited
|
Gibraltar
|
Rowan Renaissance Luxembourg S.à r.l.
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Luxembourg
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Rowan Resolute Luxembourg S.à r.l.
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Luxembourg
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Rowan Rex Limited
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Cayman Islands
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Rowan Rigs S.à r.l. (fka Lionfish Luxembourg S.à r.l.)
|
Luxembourg
|
Rowan, S. de R.L. de C.V.
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Mexico
|
Rowan Services LLC
|
Delaware
|
Rowan Standard Ghana Limited
|
Ghana
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Rowan (UK) Relentless Limited
|
England & Wales
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Rowan (UK) Reliance Limited
|
England & Wales
|
Rowan (UK) Renaissance Limited
|
England & Wales
|
Rowan UK Renaissance Onshore Limited
|
England & Wales
|
Rowan (UK) Resolute Limited
|
England & Wales
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Rowan US Holdings (Gibraltar) Limited
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Gibraltar
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Rowandrill, Inc.
|
Texas
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Rowandrill Labuan Limited
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Labuan
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Rowandrill Malaysia Sdn. Bhd.
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Malaysia
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Saudi Aramco Rowan Offshore Drilling Company
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Saudi Arabia
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SKDP 1 Limited
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Cyprus
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SKDP 2 Limited
|
Cyprus
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SKDP 3 Limited
|
Cyprus
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Signature
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Title
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Date
|
|
|
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/s/ Thomas P. Burke
|
President and Chief Executive Officer and Director (Principal Executive Officer)
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February 27, 2019
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(Thomas P. Burke)
|
|
|
|
|
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/s/ Stephen M. Butz
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
February 27, 2019
|
(Stephen M. Butz)
|
|
|
|
|
|
/s/ Dennis S. Baldwin
|
Chief Accounting Officer (Principal Accounting Officer)
|
February 27, 2019
|
(Dennis S. Baldwin)
|
|
|
|
|
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/s/ William E. Albrecht
|
Chairman of the Board
|
February 27, 2019
|
(William E. Albrecht)
|
|
|
|
|
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/s/ Thomas R. Hix
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Director
|
February 27, 2019
|
(Thomas R. Hix)
|
|
|
|
|
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/s/ Jack B. Moore
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Director
|
February 27, 2019
|
(Jack B. Moore)
|
|
|
|
|
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/s/ Suzanne P. Nimocks
|
Director
|
February 27, 2019
|
(Suzanne P. Nimocks)
|
|
|
|
|
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/s/ Thierry Pilenko
|
Director
|
February 27, 2019
|
(Thierry Pilenko)
|
|
|
|
|
|
/s/ John J. Quicke
|
Director
|
February 27, 2019
|
(John J. Quicke)
|
|
|
|
|
|
/s/ Tore I. Sandvold
|
Director
|
February 27, 2019
|
(Tore I. Sandvold)
|
|
|
|
|
|
/s/ Charles L. Szews
|
Director
|
February 27, 2019
|
(Charles L. Szews)
|
|
|
1.
|
I have reviewed this Form 10-K of Rowan Companies plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 27, 2019
|
/s/ THOMAS P. BURKE
|
|
|
Thomas P. Burke
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Form 10-K of Rowan Companies plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 27, 2019
|
/s/ STEPHEN M. BUTZ
|
|
|
Stephen M. Butz
|
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented.
|
Date:
|
February 27, 2019
|
/s/ THOMAS P. BURKE
|
|
|
Thomas P. Burke
|
|
|
President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented.
|
Date:
|
February 27, 2019
|
/s/ STEPHEN M. BUTZ
|
|
|
Stephen M. Butz
|
|
|
Executive Vice President and Chief Financial Officer
|