SUGAR LAND, Texas, July 23 /PRNewswire-FirstCall/ -- Noble Corporation
(NYSE: NE) today reported second quarter 2008 earnings of $376 million, or
$1.40 per diluted share, versus $290 million, or $1.08 per diluted share, for
the second quarter of 2007. Per-share earnings were up 30 percent from the
second quarter of 2007 and down 2 percent from the $1.43 per diluted share
reported for the first quarter of 2008.
Contract drilling services revenues for the second quarter of 2008 were
$783 million, up 19 percent from the second quarter 2007. Contract drilling
margin for the second quarter 2008 was approximately 67 percent, generating
$443 million in net cash provided by operating activities. The Company
invested approximately $291 million in capital projects during the second
quarter 2008. The results for the second quarter of 2008 include an after-tax
gain on the sale of our North Sea labor contract drilling services business of
$0.11 per diluted share and after-tax charges of $0.01 per diluted share
related to the ongoing independent investigation of the Company's Nigerian
operations.
"We are in the midst of another strong year, with great momentum as we
head into the second half of 2008," said Noble Corporation Chairman, President
and Chief Executive Officer David W. Williams. "We continue to see healthy
demand for all classes of units in all markets. We are particularly pleased
with the continued strength of the international jackup business. As we look
ahead to the remainder of the year, we anticipate taking delivery of the Noble
Hans Deul in September 2008 and seeing that unit enter service in the North
Sea, increasing our jackup fleet in that market to eight units."
Debt as a percentage of total capitalization declined to 13.1 percent at
June 30, 2008, from approximately 13.6 percent at March 31, 2008.
Earnings for the first six months of 2008 totaled $2.83 per diluted share
compared with $2.01 in the same period last year. Earnings for 2008 include
the gain on the sale of the North Sea labor contract drilling business, while
earnings for 2007 included charges of $8 million related to the sale of
non-core business assets. Contract drilling services revenues were
$1.6 billion and earnings were $760 million in the first half of 2008, up
28 percent and 41 percent, respectively, from the year-earlier period.
Second Quarter Highlights
As of June 30, 2008, approximately 89 percent of the Company's total rig
operating days were committed for the remainder of 2008 and approximately
68 percent were committed for 2009, reflecting the continued strong demand for
the Company's services. In the U.S. Gulf of Mexico, Marathon exercised its
right to extend the contract on the newbuild semisubmersible Noble Jim Day
from two to four years at the dayrate of $515,000. During the quarter, the
Noble Jim Thompson, a deepwater semisubmersible, received a two-year contract
with Shell at a dayrate of $505,000 commencing in 2009. The Company also
secured a contract for the Noble Lorris Bouzigard for a two-year term with
LLOG at a dayrate of $270,000 which began in June 2008 and an extension for an
additional year at a dayrate of $335,000 beginning in mid-2010.
Two of the Company's deepwater semisubmersibles were upgraded during the
quarter with both projects completed ahead of schedule. With the conclusion
of the work on the Noble Amos Runner, the Company completed its planned
NC-5(SM) hurricane mooring system upgrades and the rig commenced its new
contract with Anadarko at a dayrate of $435,000 in late April. Also,
upgrades, maintenance and contract preparations on the semisubmersible Noble
Max Smith were completed and that unit has been mobilized from the U.S. Gulf
of Mexico to Mexico. The Noble Max Smith will commence its three-year
contract at a dayrate of $484,000 in August. This unit will enable PEMEX to
drill in waters of up to 7,000 feet for the first time giving access to many
previously unreachable prospects.
In other international deepwater markets, the Noble Homer Ferrington's
three-year contract at a dayrate of approximately $505,000 will commence in
April 2009 for ExxonMobil. In the North Sea, the Noble Ton van Langeveld
secured a one-year contract extension beginning in mid-2009 at a dayrate of
$380,000, with an additional six month option at the same price.
The Company's international jackup units also experienced notable contract
activity in many markets during the quarter. In the Middle East, the Noble
David Tinsley secured a contract extension beginning in December 2008 and
ending March 2009 at a dayrate of $160,000 and the Noble Kenneth Delaney
received a contract extension for a minimum of 120 days beginning in mid-2009
at a dayrate of approximately $162,000. The Noble Gene House received
commitments for approximately 16 months beginning late-2008 at dayrates
ranging from $150,000 to approximately $162,000.
In the North Sea, Maersk exercised its one-year option right at a dayrate
of $210,000 on the Noble Byron Welliver. The Noble Piet van Ede entered into a
six month contract extension beginning January 2009 at a dayrate of $215,000,
with the option to convert the extension to one year at a dayrate of $212,000.
Both the Noble Ronald Hoope and the Noble George Sauvageau secured one-year
contracts beginning in January 2009 at dayrates of $212,000 and $220,000,
respectively. In West Africa, the Noble Percy Johns secured a one-year
contract beginning in March 2009 at a dayrate of $183,000. Also in that
market, the Noble Ed Noble secured a 10 month contract beginning September
2008 at a dayrate of $173,000 and the Noble Tommy Craighead received a letter
of intent for one year beginning in January 2009 at a strong market dayrate.
In Mexico, the Company announced today that its customer PEMEX has awarded
a 1,217-day tender for the Noble Tom Jobe at a dayrate for the first six
months of $155,000 and adjustable quarterly thereafter to an index of U.S. and
international like kind jackup rates.
Business Outlook
"Looking ahead, our industry faces a number of challenges. Raw materials
costs, such as the price of steel, continue to climb. Added to this are
increases in labor costs and the fluctuation in foreign exchange," said
Williams. "That said the unprecedented strength of Noble's current global
markets for both our deepwater fleet and our jackups is likely to create
strong opportunities for our sustained growth. During the second half of 2008,
we expect to continue leveraging our key strengths, such as safety and
operational excellence, driving revenue growth and helping maintain our
margins."
Noble Corporation is a leading offshore drilling contractor for the oil
and gas industry. The Company performs contract drilling services with its
fleet of 62 mobile offshore drilling units located in key markets worldwide,
including the U.S. Gulf of Mexico, Middle East, Mexico, the North Sea, Brazil,
West Africa and India. The fleet count includes five rigs under construction.
Additional information on Noble Corporation is available via the worldwide web
at http://www.noblecorp.com.
This news release contains "forward-looking statements" about the
business, financial performance and prospects of the Company. Statements about
the Company's or management's plans, intentions, expectations, beliefs,
estimates, predictions, or similar expressions for the future are
forward-looking statements. No assurance can be given that the outcomes of
these forward-looking statements will be realized, and actual results could
differ materially from those expressed as a result of various factors. A
discussion of these factors, including risks and uncertainties, is set forth
from time to time in the Company's filings with the U.S. Securities and
Exchange Commission.
Conference Call
Noble will hold its second quarter conference call on Thursday, July 24,
2008, at 1:00 p.m., Central Time. The call may be accessed live via telephone
at (866) 461-7129 (706-679-3084 for international callers), using pass code
52518031. The call also will be available over the Internet through the
"Investor Relations" section of the Company's Web site, using the "Web cast"
link. A replay of the conference call will be available on Thursday, July 24,
2008, beginning at 5:00 p.m., Central Time, through Thursday, July 31, 2008,
ending at 5:00 p.m., Central Time. The phone number for the conference call
replay is 800-642-1687 (706-645-9291 for international callers), using the
conference ID number 52518031. The conference call may include non-GAAP
financial measures. Noble will post a reconciliation of any such measures to
the most directly comparable GAAP measures in the "Investor Relations" section
of the Company's Web site under the heading "Reg G Reconciliations."
NOBLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
OPERATING REVENUES
Contract drilling services $783,280 $657,504 $1,581,114 $1,234,419
Reimbursables 20,964 28,608 53,422 59,751
Labor contract drilling
services 8,218 39,165 39,149 75,720
Engineering, consulting and
other 479 722 681 2,533
812,941 725,999 1,674,366 1,372,423
OPERATING COSTS AND EXPENSES
Contract drilling services 256,436 212,050 492,388 408,892
Reimbursables 17,831 24,608 47,292 52,154
Labor contract drilling
services 6,547 32,454 31,884 60,857
Engineering, consulting and
other - 7,255 - 11,296
Depreciation and
amortization 87,836 68,323 170,735 132,388
Selling, general and
administrative 19,667 20,302 40,940 34,528
Gain on disposal of assets,
net (35,521) - (35,521) -
352,796 364,992 747,718 700,115
OPERATING INCOME 460,145 361,007 926,648 672,308
OTHER INCOME (EXPENSE)
Interest expense, net of
amounts capitalized (721) (1,231) (1,831) (2,735)
Interest income and other,
net 1,580 512 4,709 1,670
INCOME BEFORE INCOME TAXES 461,004 360,288 929,526 671,243
INCOME TAX PROVISION (85,286) (70,257) (169,620) (130,892)
NET INCOME $375,718 $290,031 $ 759,906 $ 540,351
NET INCOME PER SHARE:
Basic $ 1.41 $ 1.09 $ 2.85 $ 2.03
Diluted $ 1.40 $ 1.08 $ 2.83 $ 2.01
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic 266,464 265,927 266,458 266,521
Diluted 269,194 268,740 268,886 269,167
NOBLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
June 30, December 31,
2008 2007
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 320,964 $ 161,058
Accounts receivable 560,923 613,115
Insurance receivables - 39,066
Prepaid expenses 51,529 20,721
Other current assets 36,499 26,231
Total current assets 969,915 860,191
PROPERTY AND EQUIPMENT
Drilling equipment and facilities 6,794,897 6,354,782
Other 97,515 80,169
6,892,412 6,434,951
Accumulated depreciation (1,753,263) (1,639,035)
5,139,149 4,795,916
OTHER ASSETS 243,256 219,899
$6,352,320 $5,876,006
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current maturities of long-term debt $ 27,958 $ 10,334
Accounts payable 172,805 198,395
Accrued payroll and related costs 97,623 115,914
Taxes payable 102,814 85,641
Interest payable 9,465 9,951
Other current liabilities 53,551 72,537
Total current liabilities 464,216 492,772
LONG-TERM DEBT 701,507 774,182
DEFERRED INCOME TAXES 254,521 240,621
OTHER LIABILITIES 94,237 65,705
1,514,481 1,573,280
COMMITMENTS AND CONTINGENCIES
MINORITY INTEREST (5,313) (5,596)
SHAREHOLDERS' EQUITY
Ordinary shares-par value $0.10 per
share; 400,000 shares authorized;
269,157 shares issued and outstanding
in 2008; 268,223 shares issued and
outstanding in 2007 26,916 26,822
Capital in excess of par value 686,641 683,697
Retained earnings 4,139,866 3,602,870
Accumulated other comprehensive loss (10,271) (5,067)
4,843,152 4,308,322
$6,352,320 $5,876,006
NOBLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended June 30,
2008 2007
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $759,906 $540,351
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation and amortization 170,735 132,388
Impairment loss on assets - 5,400
Deferred income tax provision 13,900 6,324
Share-based compensation expense 18,471 16,903
Pension contribution (17,445) (16,705)
Gain on disposal of assets, net (35,521) -
Other 7,761 9,426
Other changes in current assets and
liabilities:
Accounts receivable 52,192 (88,627)
Hurricane insurance recoveries 17,319 -
Other current assets (42,632) 14,325
Accounts payable (7,994) (20,960)
Other current liabilities (1,179) 33,243
Net cash provided by operating
activities 935,513 632,068
CASH FLOWS FROM INVESTING ACTIVITIES
New construction (310,770) (323,338)
Other capital expenditures (161,546) (216,452)
Major maintenance expenditures (52,577) (39,370)
Accrued capital expenditures (17,596) 22,173
Hurricane insurance recoveries 21,747 -
Proceeds from sales of property and
equipment 39,134 3,284
Net cash used for investing
activities (481,608) (553,703)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings on bank credit facilities - 220,000
Payments on bank credit facilities (50,000) (85,000)
Payments of other long-term debt (5,076) (4,730)
Net proceeds from employee stock
transactions 10,558 13,560
Dividends paid (222,910) (10,788)
Repurchases of ordinary shares (26,571) (120,687)
Net cash used for financing
activities (293,999) 12,355
NET INCREASE IN CASH AND CASH EQUIVALENTS 159,906 90,720
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD 161,058 61,710
CASH AND CASH EQUIVALENTS, END OF PERIOD $320,964 $152,430
NOBLE CORPORATION AND SUBSIDIARIES
FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT
(In thousands, except utilization amounts, operating days and
average dayrates)
(Unaudited)
Three Months Ended June 30,
2008
Contract
Drilling
Services Other Total
OPERATING REVENUES
Contract drilling services $783,280 $ - $783,280
Reimbursables 19,646 1,318 20,964
Labor contract drilling services - 8,218 8,218
Engineering, consulting and other 464 15 479
$803,390 $ 9,551 $812,941
OPERATING COSTS AND EXPENSES
Contract drilling services $256,436 $ - $256,436
Reimbursables 16,565 1,266 17,831
Labor contract drilling services - 6,547 6,547
Engineering, consulting and other - - -
Depreciation and amortization 86,636 1,200 87,836
Selling, general and administrative 19,526 141 19,667
Gain on disposal of assets, net - (35,521) (35,521)
$379,163 $(26,367) $352,796
OPERATING INCOME $424,227 $ 35,918 $460,145
OPERATING STATISTICS
Jackups:
Average Rig Utilization 93%
Operating Days 3,481
Average Dayrate $147,081
Semisubmersibles - (6,000 feet or
greater):
Average Rig Utilization 90%
Operating Days 572
Average Dayrate $323,830
Semisubmersibles - (less than 6,000
feet):
Average Rig Utilization 100%
Operating Days 273
Average Dayrate $192,416
Drillships:
Average Rig Utilization 67%
Operating Days 182
Average Dayrate $131,174
Submersibles:
Average Rig Utilization 67%
Operating Days 182
Average Dayrate $ 53,039
Total:
Average Rig Utilization 90%
Operating Days 4,690
Average Dayrate $167,002
NOBLE CORPORATION AND SUBSIDIARIES
FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT
(In thousands, except utilization amounts, operating days and
average dayrates)
(Unaudited)
Three Months Ended June 30,
2007
Contract
Drilling
Services Other Total
OPERATING REVENUES
Contract drilling services $657,504 $ - $657,504
Reimbursables 19,856 8,752 28,608
Labor contract drilling services - 39,165 39,165
Engineering, consulting and other 376 346 722
$677,736 $48,263 $725,999
OPERATING COSTS AND EXPENSES
Contract drilling services $212,050 $ - $212,050
Reimbursables 16,706 7,902 24,608
Labor contract drilling services - 32,454 32,454
Engineering, consulting and other 15 7,240 7,255
Depreciation and amortization 66,108 2,215 68,323
Selling, general and administrative 19,743 559 20,302
Gain on disposal of assets, net - -
$314,622 $50,370 $364,992
OPERATING INCOME $363,114 $(2,107) $361,007
OPERATING STATISTICS
Jackups:
Average Rig Utilization 98%
Operating Days 3,553
Average Dayrate $112,804
Semisubmersibles - (6,000 feet or
greater):
Average Rig Utilization 100%
Operating Days 555
Average Dayrate $285,758
Semisubmersibles - (less than 6,000
feet):
Average Rig Utilization 87%
Operating Days 239
Average Dayrate $169,283
Drillships:
Average Rig Utilization 100%
Operating Days 273
Average Dayrate $128,874
Submersibles:
Average Rig Utilization 100%
Operating Days 273
Average Dayrate $ 82,137
Total:
Average Rig Utilization 98%
Operating Days 4,893
Average Dayrate $134,364
NOBLE CORPORATION AND SUBSIDIARIES
FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT
(In thousands, except utilization amounts, operating days and
average dayrates)
(Unaudited)
Three Months Ended March 31,
2008
Contract
Drilling
Services Other Total
OPERATING REVENUES
Contract drilling services $797,834 $ - $797,834
Reimbursables 21,166 11,292 32,458
Labor contract drilling services - 30,931 30,931
Engineering, consulting and other 187 15 202
$819,187 $42,238 $861,425
OPERATING COSTS AND EXPENSES
Contract drilling services $235,952 $ - $235,952
Reimbursables 18,753 10,708 29,461
Labor contract drilling services - 25,337 25,337
Engineering, consulting and other - - -
Depreciation and amortization 80,785 2,114 82,899
Selling, general and administrative 19,896 1,377 21,273
Gain on disposal of assets, net - - -
$355,386 $39,536 $394,922
OPERATING INCOME $463,801 $ 2,702 $466,503
OPERATING STATISTICS
Jackups:
Average Rig Utilization 97%
Operating Days 3,601
Average Dayrate $145,337
Semisubmersibles - (6,000 feet or
greater):
Average Rig Utilization 100%
Operating Days 637
Average Dayrate $291,924
Semisubmersibles - (less than 6,000
feet):
Average Rig Utilization 100%
Operating Days 273
Average Dayrate $201,699
Drillships:
Average Rig Utilization 67%
Operating Days 182
Average Dayrate $133,665
Submersibles:
Average Rig Utilization 66%
Operating Days 179
Average Dayrate $ 51,274
Total:
Average Rig Utilization 94%
Operating Days 4,872
Average Dayrate $163,772
SOURCE Noble Corporation
/CONTACT: investors, Lee M. Ahlstrom, Vice President - Investor Relations
and Planning, +1-281-276-6440, or media, John S. Breed, Director of Corporate
Communications, +1-281-276-6729, both of Noble Drilling Services Inc./
/Web site: http://www.noblecorp.com /
