Rowan Reports Second Quarter 2014 Results

HOUSTON, Aug. 6, 2014 /PRNewswire/ -- For the three months ended June 30, 2014, Rowan Companies plc ("Rowan" or the "Company") (NYSE: RDC) generated net income from continuing operations of $32.9 million, or $0.26 per share, compared to $82.8 million, or $0.67 per share in the second quarter of 2013.  The current quarter reflects a noncash asset impairment charge which reduced net income from continuing operations by $8.3 million, or $0.07 per share.  The prior-year quarter included a $12.5 million after-tax gain, or $0.10 per share on the sale of a jack-up rig (Rowan – Paris).  Excluding the impacts of these items, net income from continuing operations was $41.2 million or $0.33 per share in the second quarter of 2014 and $70.3 million, or $0.57 per share in the second quarter of 2013.

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Rowan's revenues were $422.9 million in the second quarter of 2014, up 3% over the prior-year quarter due primarily to the commencement, in late April 2014, of the company's first ultra-deepwater drillship.  However, our second quarter 2014 revenues and operating results were significantly impacted by previously disclosed out-of-service periods which resulted in 13% out-of-service time during the second quarter of 2014, compared to 8% in the prior-year quarter. 

Tom Burke, President and Chief Executive Officer, commented, "We are pleased that our first ultra-deepwater drillship, the Rowan Renaissance, commenced operations in the second quarter. As our remaining three drillships commence operations over the next twelve months, we look forward to the stability that this earnings growth and associated balancing of our fleet will provide to our shareholders.

"The second quarter was negatively impacted by additional out-of-service days for certain jack-ups as well as start-up issues for the Renaissance.  We expect our out-of-service time for our jack-up fleet to decrease significantly beginning in the third quarter.

"We continue to believe that our quality fleet, the talent and experience of our crews, our significant revenue backlog, and our conservative financial profile place us in a solid competitive position as new capacity enters the market and displaces older and less capable rigs."

Rowan will conduct its earnings conference call on Wednesday, August 6, 2014, at 10:00 a.m. Central Time.  Interested parties are invited to listen to the call by telephone or over the Internet.  Individuals who wish to participate on the conference call by telephone may dial (877) 869-3847, or internationally (201) 689-8261.  You should dial-in approximately five to 10 minutes prior to the scheduled start time.  Alternatively, to access the online simulcast and rebroadcast of the conference call, please visit Rowan's website at www.rowancompanies.com.  You should connect to our website at least 15 minutes prior to the conference call to register, and download any necessary software.

Rowan Companies plc is a global provider of international contract drilling services in the ultra-deepwater and shallow water jack-up market with a fleet of 34 offshore drilling units, including four ultra-deepwater drillships, two of which are currently under construction, and 30 jack-up rigs, 19 of which are rated high-specification.  The Company's fleet is located worldwide, including the United Kingdom and Norwegian sectors of the North Sea, the Middle East, the United States Gulf of Mexico, Southeast Asia, West and North Africa and Trinidad.  All four of the Company's ultra-deepwater drillships are now under long-term contracts.  The Company's Class A Ordinary Shares are traded on the New York Stock Exchange under the symbol "RDC."  For more information on the Company, please visit www.rowancompanies.com

Statements herein that are not historical facts are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected business, financial performance and prospects of the Company.  These forward-looking statements are based on our current expectations and are subject to certain risks, assumptions, trends and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements.  Among the factors that could cause actual results to differ materially include oil and natural gas prices, the level of offshore expenditures by energy companies, variations in energy demand, changes in day rates, cancellation by our customers of drilling contracts or letter agreements or letters of intent for drilling contracts or the exercise of early termination provisions, risks associated with fixed cost drilling operations, cost overruns or delays on shipyard repair, construction or transportation of drilling units, maintenance and repair costs, costs or delays for conversion or upgrade projects, operating hazards and equipment failure, risks of collision and damage, casualty losses and limitations on insurance coverage, customer credit and risk of customer bankruptcy,  conditions in the general economy and energy industry, weather conditions and severe weather in the Company's operating areas, increasing complexity and costs of compliance with environmental and other laws and regulations, changes in tax laws and interpretations by taxing authorities, changes in tax rates and provisions, civil unrest and instability, terrorism and hostilities in our areas of operations that may result in loss or seizure of assets, the outcome of disputes and legal proceedings, effects of the change in our corporate structure, and other risks disclosed in the Company's filings with the U.S. Securities and Exchange Commission.  Each forward-looking statement speaks only as of the date hereof, and the Company expressly disclaims any obligation to update or revise any forward-looking statements, except as required by law.

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED  BALANCE  SHEETS

Unaudited  (In  Millions)


































JUNE 30,


DECEMBER 31,







2014


2013










ASSETS













Cash and cash equivalents


$       1,247.0


$       1,092.8

Accounts receivable




422.7


344.6

Other current assets




72.2


67.7

Assets of discontinued operations

-


23.8

     Total current assets




1,741.9


1,528.9

Property, plant and equipment - net

7,009.6


6,385.8

Other assets





67.4


61.1

     TOTAL





$       8,818.9


$       7,975.8



















LIABILITIES  AND  STOCKHOLDERS'  EQUITY










Accounts payable




$           117.5


$           124.0

Other current liabilities



176.9


210.5

Liabilities of discontinued operations

-


20.1

     Total current liabilities


294.4


354.6

Long-term debt





2,807.8


2,008.7

Other liabilities





724.4


718.7

Stockholders' equity




4,992.3


4,893.8

     TOTAL





$       8,818.9


$       7,975.8

 

 

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED  STATEMENTS  OF  OPERATIONS

Unaudited  (In  Millions  Except  Per  Share  Amounts)




















THREE  MONTHS


SIX  MONTHS








ENDED  JUNE  30


ENDED  JUNE  30








2014


2013


2014


2013















REVENUES






$  422.9


$  408.9


$  800.5


$  803.1















COSTS  AND  EXPENSES:












Operations





244.6


216.0


464.9


425.5


Depreciation and amortization

77.7


66.5


148.6


131.1


Selling, general and administrative

29.1


33.3


59.0


62.7


(Gain)/loss on disposals of property and equipment

0.9


(19.2)


1.7


(18.9)


Material charges, settlements and other expenses

8.3


-


(12.6)


-



Total





360.6


296.6


661.6


600.4

INCOME  FROM  OPERATIONS


62.3


112.3


138.9


202.7

Net interest and other income

(27.5)


(17.8)


(48.2)


(36.8)

INCOME  FROM  CONTINUING  OPERATIONS  BEFORE  INCOME  TAXES

34.8


94.5


90.7


165.9

Provision for income taxes



2.0


11.7


2.3


14.9

NET  INCOME  FROM  CONTINUING  OPERATIONS

32.8


82.8


88.4


151.0

Discontinued operations, net of tax

-


-


4.0


-

NET  INCOME






$    32.8


$    82.8


$    92.4


$  151.0















PER  SHARE  AMOUNTS:












Income from continuing operations

$    0.26


$    0.67


$    0.71


$    1.21


Discontinued operations, net of tax

$          -


$          -


$    0.03


$           -


Net income





$    0.26


$    0.67


$    0.74


$    1.21















AVERAGE  DILUTED  SHARES



124.9


124.4


124.8


124.3















NOTE:  See page 6 for supplemental operating information.



 

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED   STATEMENTS  OF  CASH  FLOWS

Unaudited  (In  Millions)































SIX  MONTHS









ENDED  JUNE  30









2014


2013

CASH  PROVIDED  BY  (USED  IN):





   Operations:










      Net income







$        92.4


$     151.0

      Adjustments  to  reconcile  net  income  to  net



      cash  provided  by  operations:





         Depreciation  and  amortization

148.6


131.1

         Deferred  income  taxes




1.1


(1.0)

         Gain  on  disposals  of  assets


(0.3)


(18.9)

         Other -  net







5.9


23.4

      Net  changes  in  current  assets  and  liabilities

(97.4)


(71.3)

      Net  changes  in  other  noncurrent  assets  and  liabilities

(0.8)


20.0

   Net  cash  provided  by  operations

149.5


234.3












   Investing  activities:









      Property,  plant  and  equipment  additions

(787.3)


(298.7)

      Proceeds  from  disposals  of  property,  plant  and  equipment

7.9


42.1

   Net  cash  used  in  investing  activities

(779.4)


(256.6)












   Financing  activities:









      Proceeds from borrowings



792.7


-

      Payment of cash dividends



(12.6)


-

      Proceeds  from  equity  compensation  plans  and  other

4.0


4.2

   Net  cash  provided  by  financing  activities

784.1


4.2












INCREASE (DECREASE)  IN  CASH  AND  CASH  EQUIVALENTS

154.2


(18.1)

CASH  AND  CASH  EQUIVALENTS,  BEGINNING  OF  PERIOD

1,092.8


1,024.0

CASH  AND  CASH  EQUIVALENTS,  END  OF  PERIOD

$  1,247.0


$  1,005.9

 

 

ROWAN  COMPANIES  PLC

SUPPLEMENTAL  OPERATING  INFORMATION

Unaudited










THREE  MONTHS  ENDED












June 30,


March 31,


June 30,









2014


2014


2013














RIG  DAYS:











Operating





2,213


2,153


2,313


Out of service (shipyard/transit/inspections/other)

363


344


217


Operational downtime (off rate during rig operations)

41


23


18


Cold stacked




182


180


248
















Total available



2,799


2,700


2,796
















Utilization




79%


80%


83%



Utilization (excluding cold-stacked rigs)

85%


85%


91%














AVERAGE  DAY  RATES  (in  thousands):







North Sea





$   290.5


$      273.6


$  256.8


Middle East




141.4


136.0


137.7


Gulf of Mexico



156.9


153.6


137.1


All rigs






185.7


171.4


172.8














OPERATIONS  COSTS  AND  EXPENSES  (in  millions):





Personnel (a)




$   151.8


$      138.3


$  138.3


Repairs and maintenance


48.6


40.8


35.3


Insurance





8.4


7.8


8.3


Rig moves





3.2


3.8


8.0


All other





20.9


21.2


17.2



Subtotal (excluding rebillables)

$   232.9


$      211.9


$  207.1


Rebillables (equally offset with rebillable revenue)

11.7


8.4


8.9
















Total





$   244.6


$      220.3


$  216.0
















(a)  Includes labor, fringes, training, travel and catering costs.


SOURCE Rowan Companies plc



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