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Rowan Reports Fourth Quarter and Full-Year 2013 Results

HOUSTON, Feb. 27, 2014 /PRNewswire/ -- For the three months ended December 31, 2013, Rowan Companies plc ("Rowan" or the "Company") (NYSE: RDC) generated net income from continuing operations of $49.7 million, or $0.40 per share, compared to $70.5 million, or $0.57 per share in the fourth quarter of 2012.  The current quarter reflects a non cash impairment charge on a property held for sale which reduced net income by $2.9 million, or $0.02 per share.  The prior-year quarter included non-recurring or unusual items which increased net income from continuing operations by approximately $15.6 million, or $0.13 per share.

Rowan Companies plc

Rowan's revenues were $393.4 million in the fourth quarter of 2013, up 11% over the prior-year quarter due primarily to higher average day rates and slightly higher utilization.  The operating results for the fourth quarter of 2013 were significantly impacted by the continued out-of-service period for the Gorilla VII following leg damage sustained as it was moving locations in July.  Extended poor weather conditions in the North Sea hampered the rig's ability to return to its operating location.

Matt Ralls, Chief Executive Officer, commented, "As we enter 2014, we are very pleased with the makeup and positioning of our fleet.  While the overall market is experiencing some turbulence related to new capacity coming into the market and displacing older, less capable rigs, the high specification nature of both our jack-up and drillship fleets puts us in an excellent competitive position.  We have 17 of our jack-ups coming off contract over the balance of the year, and as we see the market currently, we are confident that we will find follow-on work for those rigs at or above their current day rates. 

On the deepwater side, we took delivery of our first ultra-deepwater drillship early this year and it is currently in transit to West Africa to complete acceptance testing and is expected to begin a three-year contract with Repsol in April.  This rig is the first of four ultra-high specification drillships being built for Rowan by Hyundai Heavy Industries in Korea.  The second and third drillships both deliver later this year and have three year contracts at attractive day rates.  We remain optimistic that our last remaining uncontracted ship will be contracted at market leading day rates prior to its delivery in the spring of 2015.

In January, we issued $800 million in long-term debt, which, along with an increased credit facility and cash flow from operations, is expected to provide the funds needed to complete our drillship construction program.  We are also pleased to have announced in January the Board's decision to reinstate a modest quarterly dividend beginning in the second quarter of this year."

Rowan will conduct its earnings conference call on Thursday, February 27, 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 and domestic 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, three 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 West Africa, the Middle East, the North Sea, Trinidad, Egypt, Southeast Asia and the Gulf of Mexico.  Three of the four ultra-deepwater drillships are under three year 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)


































DECEMBER 31,


DECEMBER 31,







2013


2012










ASSETS













Cash and cash equivalents




$  1,092.8


$  1,024.0

Accounts receivable




344.6


423.8

Other current assets




62.2


81.8

Assets of discontinued operations



23.8


23.0

     Total current assets




1,523.4


1,552.6

Property, plant and equipment - net


6,385.8


6,071.7

Other assets





61.1


75.2

     TOTAL





$  7,970.3


$  7,699.5



















LIABILITIES  AND  STOCKHOLDERS'  EQUITY













Accounts payable




$     124.0


$        83.0

Other current liabilities




210.5


189.8

Liabilities of discontinued operations


20.1


21.3

     Total current liabilities




354.6


294.1

Long-term debt





2,008.7


2,009.6

Other liabilities





713.2


864.1

Stockholders' equity




4,893.8


4,531.7

     TOTAL





$  7,970.3


$  7,699.5





ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED  STATEMENTS  OF  OPERATIONS

Unaudited  (In  Millions  Except  Per  Share  Amounts)




















THREE  MONTHS


TWELVE  MONTHS








ENDED  DECEMBER  31


ENDED  DECEMBER  31








2013


2012


2013


2012















REVENUES






$  393.4


$  354.2


$  1,579.3


$  1,392.6















COSTS  AND  EXPENSES:













Operations





223.5


193.8


860.9


752.2


Depreciation and amortization




70.6


64.5


271.0


247.9


Selling, general and administrative



35.4


25.8


131.3


99.7


(Gain)/loss on disposals of property and equipment


(1.1)


0.2


(20.1)


(2.5)


Material charges and other expenses



4.5


9.4


4.5


40.3



Total





332.9


293.7


1,247.6


1,137.6

INCOME  FROM  OPERATIONS




60.5


60.5


331.7


255.0

Net interest and other income




(16.6)


(12.7)


(70.5)


(71.5)

INCOME  FROM  CONTINUING  OPERATIONS  BEFORE  INCOME  TAXES

43.9


47.8


261.2


183.5

Provision for income taxes




(5.8)


(22.7)


8.6


(19.8)

NET  INCOME  FROM  CONTINUING  OPERATIONS



49.7


70.5


252.6


203.3

Discontinued operations, net of tax




-


(16.4)


-


(22.7)

NET  INCOME






$    49.7


$    54.1


$     252.6


$     180.6















PER  SHARE  AMOUNTS:













Income from continuing operations



$    0.40


$    0.57


$       2.03


$       1.65


Discontinued operations, net of tax



$          -


$   (0.13)


$             -


$     (0.18)


Net income





$    0.40


$    0.44


$       2.03


$       1.47















AVERAGE  DILUTED  SHARES




124.7


124.1


124.5


123.9















NOTE:  See supplemental operating information.

 

 

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED   STATEMENTS  OF  CASH  FLOWS

Unaudited  (In  Millions)































TWELVE  MONTHS









ENDED  DECEMBER  31









2013


2012

CASH  PROVIDED  BY  (USED  IN):








   Operations:










      Net income







$     252.6


$     180.6

      Adjustments  to  reconcile  net  income  to  net






      cash  provided  by  operations:








         Depreciation  and  amortization





271.0


247.9

         Deferred  income  taxes





(33.6)


(4.6)

         Gain  on  disposals  of  assets





(20.1)


(2.5)

         Other -  net







48.1


31.1

      Net  changes  in  current  assets  and  liabilities



44.8


(74.0)

      Net  changes  in  other  noncurrent  assets  and  liabilities


60.4


15.2

   Net  cash  provided  by  operations





623.2


393.7












   Investing  activities:









      Property,  plant  and  equipment  additions




(607.3)


(685.3)

      Proceeds  from  disposals  of  property,  plant  and  equipment


44.5


10.5

   Net  cash  used  in  investing  activities




(562.8)


(674.8)












   Financing  activities:









      Proceeds from borrowings





-


1,102.9

      Repayments  of  borrowings





-


(238.5)

      Proceeds  from  equity  compensation  plans  and  other


8.4


1.8

   Net  cash  provided  by  (used  in)  financing  activities



8.4


866.2












INCREASE (DECREASE)  IN  CASH  AND  CASH  EQUIVALENTS


68.8


585.1

CASH  AND  CASH  EQUIVALENTS,  BEGINNING  OF  PERIOD


1,024.0


438.9

CASH  AND  CASH  EQUIVALENTS,  END  OF  PERIOD



$  1,092.8


$  1,024.0

 

 

ROWAN  COMPANIES  PLC

SUPPLEMENTAL  OPERATING  INFORMATION

Unaudited














THREE  MONTHS  ENDED


TWELVE  MONTHS  ENDED









December 31,


September 30,


December 31,


DECEMBER 31,









2013


2013


2012


2013


2012


















RIG  DAYS:
















Operating

2,279


2,205


2,242


9,027


8,677


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

267


354


296


1,097


1,310


Operational downtime (off rate during rig operations)

30


17


38


96


156


Cold stacked

184


184


276


886


1,158




















Total available

2,760


2,760


2,852


11,106


11,301




















Utilization

83%


80%


79%


81%


77%



Utilization (excluding cold-stacked rigs)

88%


86%


87%


88%


86%


















AVERAGE  DAY  RATES  (in  thousands):











North Sea

$  284.0


$  281.1


$  234.9


$   270.4


$   237.0


Middle East

135.6


137.2


129.6


136.5


133.0


Gulf of Mexico

143.4


140.2


127.5


138.5


121.0


All rigs

168.4


169.2


153.5


170.9


156.3


















OPERATIONS  COSTS  AND  EXPENSES  (in  millions):











Personnel (a)

$  141.7


$  129.0


$  111.4


$ 537.7


$ 443.0


Repairs and maintenance

42.3


45.9


38.0


161.7


143.4


Insurance

8.0


8.0


8.0


32.5


32.7


Rig moves

3.8


4.4


7.2


23.6


30.3


All other

18.3


14.9


19.3


69.7


67.0



Subtotal (excluding rebillables)

$  214.1


$  202.2


$  183.9


$   825.2


$   716.4


Rebillables (equally offset with rebillable revenue)

9.4


9.6


9.9


35.7


35.8




















Total

$  223.5


$  211.8


$  193.8


$   860.9


$   752.2




















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


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SOURCE Rowan Companies plc

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