Transocean Ltd. (NYSE: RIG) today reported net loss attributable to
controlling interest of $392 million, $0.64 per diluted
share, for the three months ended March 31, 2020.
First quarter 2020 results included net unfavorable items of
$205 million, or $0.34 per diluted share, as follows:
- $167 million, $0.28 per diluted share, loss on
impairment of assets; and
- $57 million, $0.09 per diluted share, loss on
retirement of debt.
These unfavorable items were partially offset by:
- $19 million, $0.03 per diluted share, related to
discrete tax items.
After consideration of these net unfavorable items,
first quarter 2020 adjusted net loss was $187 million, or
$0.30 per diluted share.
Contract drilling revenues for the three months ended
March 31, 2020, decreased sequentially by $33 million,
primarily due to reduced activity related to rigs that were idle
and lower revenue efficiency. These decreases were partially offset
by a full quarter of revenues from the recently reactivated
ultra‑deepwater floaters Deepwater Mykonos and Deepwater
Corcovado.
First quarter 2020 results reflected a non-cash revenue
reduction of $48 million, compared to $47 million in the
prior quarter, from contract intangible amortization associated
with the Songa and Ocean Rig acquisitions.
Operating and maintenance expense was $540 million,
compared with $575 million in the prior quarter. The
sequential decrease was the result of lower in-service maintenance
cost across our fleet, activation costs in the prior quarter, and
reduced activity due to lower utilization. This was partially
offset by higher expense reimbursed by our customers and higher
severance cost.
General and administrative expense was $43 million, as
compared to $54 million in the fourth quarter of 2019. The
decrease was primarily due to legal, professional and advisory fees
incurred in the fourth quarter that were not repeated in the first
quarter.
Interest expense, net of amounts capitalized, was
$160 million, in line with the fourth quarter. Interest income
was $9 million, compared with $10 million in the previous
quarter.
The Effective Tax Rate(2) was 1.1%, down from 30.3% in the
prior quarter. The decrease was primarily due to various discrete
period tax items, including the carryback of net operating losses
in the U.S. as a result of the Coronavirus Aid, Relief and Economic
Security Act, settlements and expirations of uncertain tax
positions, gains and losses on currency exchange rates and changes
in valuation allowance. The Effective Tax Rate excluding discrete
items was (9.5)% compared to (47.2)% in previous quarter.
Cash flows used in operating activities were $48 million,
compared to cash provided by operating activities of
$147 million in the prior quarter. The first quarter cash used
in operating activities increased sequentially from operating cash
generated in the fourth quarter, during which we experienced a high
level of collections. This was primarily a result of more
normalized collections on customer receivables combined with
increased cash used in our operations including the timing of
interest disbursements and payments as well as tax withholdings and
tax payments in a number of non-U.S. jurisdictions.
First quarter 2020 capital expenditures of $107 million
decreased primarily due to reduced expenditures for the
reactivation of two rigs and leasehold improvements, partially
offset by increased expenditures for our newbuild rigs under
construction. This compares with $128 million in the previous
quarter.
“With the challenges we confronted related to COVID-19, I am
very proud of the strong quarterly financial results we delivered,”
said Jeremy Thigpen, President and Chief Executive Officer.
“Through outstanding effort across our entire organization, we
delivered revenue in line with our guidance, and at lower than
projected costs; even with the additional hurdles we overcame
crewing and equipping our rigs to meet their contractual
requirements for our customers. Looking forward, we recognize the
dramatic decline in oil prices, coupled with the continued
uncertainties surrounding the containment of COVID-19, and the
resumption of the global economy, will invariably delay the
contracting activity that we expected in 2020. However, with our
industry-leading backlog and proven track record for managing
costs, we expect to continue to deliver industry-best margins. With
continued strong operating performance, and the prudent management
of our liquidity, Transocean is well-positioned to continue
delivering the highest level of service while keeping our employees
and our customers safe.”
Non-GAAP Financial Measures
We present our operating results in accordance with accounting
principles generally accepted in the U.S. (U.S. GAAP). We believe
certain financial measures, such as Adjusted Contract Drilling
Revenues, EBITDA, Adjusted EBITDA and Adjusted Net Income, which
are non-GAAP measures, provide users of our financial statements
with supplemental information that may be useful in evaluating our
operating performance. We believe that such non-GAAP measures, when
read in conjunction with our operating results presented under U.S.
GAAP, can be used to better assess our performance from period to
period and relative to performance of other companies in our
industry, without regard to financing methods, historical cost
basis or capital structure. Such non-GAAP measures should be
considered as a supplement to, and not as a substitute for,
financial measures prepared in accordance with U.S. GAAP.
All non-GAAP measure reconciliations to the most comparative
U.S. GAAP measures are displayed in quantitative schedules on the
company’s website at: www.deepwater.com.
About Transocean
Transocean is a leading international provider of offshore
contract drilling services for oil and gas wells. The company
specializes in technically demanding sectors of the global offshore
drilling business with a particular focus on ultra-deepwater and
harsh environment drilling services, and believes that it operates
one of the most versatile offshore drilling fleets in the
world.
Transocean owns or has partial ownership interests in, and
operates a fleet of 41 mobile offshore drilling units
consisting of 28 ultra-deepwater floaters, 12 harsh
environment floaters and one midwater floater. In addition,
Transocean is constructing two ultra-deepwater drillships.
For more information about Transocean, please visit:
www.deepwater.com.
Conference Call Information
Transocean will conduct a teleconference starting at 9 a.m.
EDT, 3 p.m. CEST, on Thursday, April 30, 2020, to discuss
the results. To participate, dial +1 323-994-2082 and refer to
conference code 7191786 approximately 10 minutes prior to the
scheduled start time.
The teleconference will be simulcast in a listen-only mode at:
www.deepwater.com, by selecting Investors, News, and Webcasts.
Supplemental materials that may be referenced during the
teleconference will be available at: www.deepwater.com, by
selecting Investors, Financial Reports.
A replay of the conference call will be available after
12 p.m. EDT, 6 p.m. CEST, on April 30, 2020. The
replay, which will be archived for approximately 30 days, can
be accessed at +1 719-457-0820, passcode 7191786 and pin 6698.
The replay will also be available on the company’s website.
Forward-Looking Statements
The statements described herein that are not historical facts
are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
These statements could contain words such as "possible," "intend,"
"will," "if," "expect," or other similar expressions.
Forward-looking statements are based on management’s current
expectations and assumptions, and are subject to inherent
uncertainties, risks and changes in circumstances that are
difficult to predict. As a result, actual results could differ
materially from those indicated in these forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, estimated duration of
customer contracts, contract dayrate amounts, future contract
commencement dates and locations, planned shipyard projects and
other out-of-service time, sales of drilling units, timing of the
company’s newbuild deliveries, operating hazards and delays, risks
associated with international operations, actions by customers and
other third parties, the fluctuation of current and future prices
of oil and gas, the global and regional supply and demand for oil
and gas, the intention to scrap certain drilling rigs, the success
of our business following prior acquisitions, the effects of the
spread of and mitigation efforts by governments, businesses and
individuals related to contagious illnesses, such as COVID-19, and
other factors, including those and other risks discussed in the
company's most recent Annual Report on Form 10-K for the year
ended December 31, 2019, and in the company's other filings
with the SEC, which are available free of charge on the SEC's
website at: www.sec.gov. Should one or more of these risks or
uncertainties materialize (or the other consequences of such a
development worsen), or should underlying assumptions prove
incorrect, actual results may vary materially from those indicated
or expressed or implied by such forward-looking statements. All
subsequent written and oral forward-looking statements attributable
to the company or to persons acting on our behalf are expressly
qualified in their entirety by reference to these risks and
uncertainties. You should not place undue reliance on
forward-looking statements. Each forward-looking statement speaks
only as of the date of the particular statement, and we undertake
no obligation to publicly update or revise any forward-looking
statements to reflect events or circumstances that occur, or which
we become aware of, after the date hereof, except as otherwise may
be required by law. All non-GAAP financial measure reconciliations
to the most comparative GAAP measure are displayed in quantitative
schedules on the company’s website at: www.deepwater.com.
This press release, or referenced documents, do not constitute
an offer to sell, or a solicitation of an offer to buy, any
securities, and do not constitute an offering prospectus within the
meaning of article 652a or article 1156 of the Swiss Code
of Obligations. Investors must rely on their own evaluation of
Transocean and its securities, including the merits and risks
involved. Nothing contained herein is, or shall be relied on as, a
promise or representation as to the future performance of
Transocean.
Notes |
|
|
(1) |
Revenue efficiency is defined as actual contract drilling revenues,
excluding revenues for contract terminations and reimbursements,
for the measurement period divided by the maximum revenue
calculated for the measurement period, expressed as a percentage.
Maximum revenue is defined as the greatest amount of contract
drilling revenues, excluding revenues for contract terminations and
reimbursements, the drilling unit could earn for the measurement
period, excluding amounts related to incentive provisions. See the
accompanying schedule entitled “Revenue Efficiency.” |
|
|
(2) |
Effective Tax Rate is defined as income tax expense divided by
income before income taxes. See the accompanying schedule entitled
“Supplemental Effective Tax Rate Analysis.” |
|
|
Analyst Contacts:Bradley Alexander+1
713-232-7515
Lexington May+1 832-587-6515
Media Contact:Pam Easton+1 713-232-7647
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In millions, except per share data) |
(Unaudited) |
|
|
|
|
|
|
|
Three months ended |
|
March 31, |
|
2020 |
|
2019 |
|
|
|
|
|
|
Contract drilling revenues |
$ |
759 |
|
|
$ |
754 |
|
|
|
|
|
|
|
Costs and expenses |
|
|
|
|
|
Operating and maintenance |
|
540 |
|
|
|
508 |
|
Depreciation and amortization |
|
206 |
|
|
|
217 |
|
General and administrative |
|
43 |
|
|
|
49 |
|
|
|
789 |
|
|
|
774 |
|
Loss on impairment |
|
(168 |
) |
|
|
— |
|
Gain (loss) on disposal of assets, net |
|
(1 |
) |
|
|
7 |
|
Operating loss |
|
(199 |
) |
|
|
(13 |
) |
|
|
|
|
|
|
Other income (expense), net |
|
|
|
|
|
Interest income |
|
9 |
|
|
|
10 |
|
Interest expense, net of amounts capitalized |
|
(160 |
) |
|
|
(166 |
) |
Loss on retirement of debt |
|
(57 |
) |
|
|
(18 |
) |
Other, net |
|
12 |
|
|
|
8 |
|
|
|
(196 |
) |
|
|
(166 |
) |
Loss before income tax benefit |
|
(395 |
) |
|
|
(179 |
) |
Income
tax benefit |
|
(4 |
) |
|
|
(8 |
) |
|
|
|
|
|
|
Net loss |
|
(391 |
) |
|
|
(171 |
) |
Net income attributable to noncontrolling interest |
|
1 |
|
|
|
— |
|
Net loss attributable to controlling interest |
$ |
(392 |
) |
|
$ |
(171 |
) |
|
|
|
|
|
|
Loss per share |
|
|
|
|
|
Basic |
$ |
(0.64 |
) |
|
$ |
(0.28 |
) |
Diluted |
$ |
(0.64 |
) |
|
$ |
(0.28 |
) |
|
|
|
|
|
|
Weighted-average shares outstanding |
|
|
|
|
|
Basic |
|
614 |
|
|
|
611 |
|
Diluted |
|
614 |
|
|
|
611 |
|
|
|
|
|
|
|
|
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(In millions, except share data) |
(Unaudited) |
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
2020 |
|
2019 |
|
|
|
|
|
|
Assets |
|
|
|
|
|
Cash and cash equivalents |
$ |
1,483 |
|
|
$ |
1,790 |
|
Accounts receivable, net of
allowance of $2 at March 31, 2020 |
|
654 |
|
|
|
654 |
|
Materials and supplies, net of
allowance of $127 at March 31, 2020 and December 31, 2019 |
|
459 |
|
|
|
479 |
|
Restricted cash accounts and investments |
|
531 |
|
|
|
558 |
|
Other current assets |
|
164 |
|
|
|
159 |
|
Total current assets |
|
3,291 |
|
|
|
3,640 |
|
|
|
|
|
|
|
Property and equipment |
|
23,935 |
|
|
|
24,281 |
|
Less accumulated depreciation |
|
(5,355 |
) |
|
|
(5,434 |
) |
Property and equipment, net |
|
18,580 |
|
|
|
18,847 |
|
Contract intangible
assets |
|
560 |
|
|
|
608 |
|
Deferred income taxes, net |
|
20 |
|
|
|
20 |
|
Other assets |
|
1,000 |
|
|
|
990 |
|
Total assets |
$ |
23,451 |
|
|
$ |
24,105 |
|
|
|
|
|
|
|
Liabilities and
equity |
|
|
|
|
|
Accounts payable |
$ |
244 |
|
|
$ |
311 |
|
Accrued income taxes |
|
41 |
|
|
|
64 |
|
Debt due within one year |
|
581 |
|
|
|
568 |
|
Other current liabilities |
|
728 |
|
|
|
781 |
|
Total current liabilities |
|
1,594 |
|
|
|
1,724 |
|
|
|
|
|
|
|
Long-term debt |
|
8,576 |
|
|
|
8,693 |
|
Deferred income taxes, net |
|
277 |
|
|
|
266 |
|
Other
long-term liabilities |
|
1,529 |
|
|
|
1,555 |
|
Total long-term liabilities |
|
10,382 |
|
|
|
10,514 |
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
Shares, CHF 0.10 par value,
641,063,270 authorized, 140,976,550 conditionally authorized,
617,970,525 issued |
|
|
|
|
|
and 614,545,303 outstanding at March 31, 2020, and 639,674,422
authorized, 142,365,398 conditionally |
|
|
|
|
|
authorized, 617,970,525 issued and 611,871,374 outstanding at
December 31, 2019 |
|
60 |
|
|
|
59 |
|
Additional paid-in capital |
|
13,431 |
|
|
|
13,424 |
|
Accumulated deficit |
|
(1,691 |
) |
|
|
(1,297 |
) |
Accumulated other comprehensive loss |
|
(331 |
) |
|
|
(324 |
) |
Total controlling interest shareholders’ equity |
|
11,469 |
|
|
|
11,862 |
|
Noncontrolling interest |
|
6 |
|
|
|
5 |
|
Total equity |
|
11,475 |
|
|
|
11,867 |
|
Total liabilities and equity |
$ |
23,451 |
|
|
$ |
24,105 |
|
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In millions) |
(Unaudited) |
|
|
|
|
|
|
|
Three months ended |
|
March 31, |
|
2020 |
|
2019 |
Cash flows from
operating activities |
|
|
|
|
|
Net loss |
$ |
(391 |
) |
|
$ |
(171 |
) |
Adjustments to reconcile to net cash provided by operating
activities: |
|
|
|
|
|
Contract intangible asset amortization |
|
48 |
|
|
|
45 |
|
Depreciation and amortization |
|
206 |
|
|
|
217 |
|
Share-based compensation expense |
|
8 |
|
|
|
9 |
|
Loss on impairment |
|
168 |
|
|
|
— |
|
(Gain) loss on disposal of assets, net |
|
1 |
|
|
|
(7 |
) |
Loss on retirement of debt |
|
57 |
|
|
|
18 |
|
Deferred income tax expense (benefit) |
|
10 |
|
|
|
(19 |
) |
Other, net |
|
18 |
|
|
|
11 |
|
Changes in deferred revenues, net |
|
5 |
|
|
|
1 |
|
Changes in deferred costs, net |
|
(11 |
) |
|
|
(1 |
) |
Changes in other operating assets and liabilities, net |
|
(167 |
) |
|
|
(154 |
) |
Net
cash used in operating activities |
|
(48 |
) |
|
|
(51 |
) |
|
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
|
Capital expenditures |
|
(107 |
) |
|
|
(52 |
) |
Proceeds from disposal of assets, net |
|
1 |
|
|
|
12 |
|
Investments in unconsolidated affiliates |
|
(6 |
) |
|
|
(60 |
) |
Proceeds from maturities of unrestricted and restricted
investments |
|
— |
|
|
|
123 |
|
Net
cash provided by (used in) investing activities |
|
(112 |
) |
|
|
23 |
|
|
|
|
|
|
|
Cash flows from
financing activities |
|
|
|
|
|
Proceeds from issuance of debt, net of discounts and issue
costs |
|
743 |
|
|
|
540 |
|
Repayments of debt |
|
(909 |
) |
|
|
(616 |
) |
Other, net |
|
(9 |
) |
|
|
(15 |
) |
Net
cash used in financing activities |
|
(175 |
) |
|
|
(91 |
) |
|
|
|
|
|
|
Net
decrease in unrestricted and restricted cash and cash
equivalents |
|
(335 |
) |
|
|
(119 |
) |
Unrestricted and restricted cash and cash equivalents, beginning of
period |
|
2,349 |
|
|
|
2,589 |
|
Unrestricted and restricted cash and cash equivalents, end of
period |
$ |
2,014 |
|
|
$ |
2,470 |
|
|
|
|
|
|
|
|
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
FLEET OPERATING STATISTICS |
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
March 31, |
|
December 31, |
|
March 31, |
Contract Drilling
Revenues (in millions) |
2020 |
|
2019 |
|
2019 |
Contract drilling
revenues |
|
|
|
|
|
|
|
|
Ultra-deepwater floaters |
$ |
528 |
|
$ |
502 |
|
$ |
476 |
Harsh environment floaters |
|
220 |
|
|
278 |
|
|
258 |
Deepwater floaters |
|
— |
|
|
— |
|
|
7 |
Midwater floaters |
|
11 |
|
|
12 |
|
|
13 |
Total contract drilling
revenues |
$ |
759 |
|
$ |
792 |
|
$ |
754 |
|
Three months ended |
|
March 31, |
|
December 31, |
|
March 31, |
Average Daily Revenue
(1) |
2020 |
|
2019 |
|
2019 |
Ultra-deepwater floaters |
$ |
332,600 |
|
$ |
336,800 |
|
$ |
339,900 |
Harsh environment
floaters |
|
303,100 |
|
|
307,700 |
|
|
286,300 |
Midwater floaters |
|
112,600 |
|
|
119,400 |
|
|
88,600 |
Total drilling fleet |
$ |
314,900 |
|
|
317,700 |
|
$ |
306,500 |
|
Three months ended |
|
March 31, |
|
December 31, |
|
March 31, |
Utilization
(2) |
2020 |
|
2019 |
|
2019 |
Ultra-deepwater floaters |
61 |
% |
|
56 |
% |
|
47 |
% |
Harsh environment
floaters |
63 |
% |
|
76 |
% |
|
80 |
% |
Midwater floaters |
39 |
% |
|
33 |
% |
|
40 |
% |
Total drilling fleet |
60 |
% |
|
61 |
% |
|
56 |
% |
|
Three months ended |
|
March 31, |
|
December 31, |
|
March 31, |
Revenue Efficiency
(3) |
2020 |
|
2019 |
|
2019 |
Ultra-deepwater floaters |
97 |
% |
|
98 |
% |
|
100 |
% |
Harsh environment
floaters |
89 |
% |
|
94 |
% |
|
94 |
% |
Midwater floaters |
87 |
% |
|
91 |
% |
|
92 |
% |
Total drilling fleet |
94 |
% |
|
96 |
% |
|
98 |
% |
|
|
|
|
|
|
|
|
|
(1) Average daily revenue is defined as contract drilling revenues
earned per operating day. An operating day is defined as a calendar
day during which a rig is contracted to earn a dayrate during the
firm contract period after commencement of operations. |
|
|
|
|
|
|
|
|
|
(2) Rig utilization is defined as the total number of operating
days divided by the total number of available rig calendar days in
the measurement period, expressed as a percentage. |
|
|
|
|
|
|
|
|
|
(3) Revenue efficiency is defined as actual contract drilling
revenues, excluding revenues for contract terminations and
reimbursements, for the measurement period divided by the maximum
revenue calculated for the measurement period, expressed as a
percentage. Maximum revenue is defined as the greatest amount of
contract drilling revenues, excluding revenues for contract
terminations and reimbursements, the drilling unit could earn for
the measurement period, excluding amounts related to incentive
provisions. |
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
NON-GAAP FINANCIAL MEASURES AND
RECONCILIATIONS |
ADJUSTED NET INCOME (LOSS) AND ADJUSTED DILUTED EARNINGS
(LOSS) PER SHARE |
(In millions, except per share data) |
|
|
YTD |
|
|
03/31/20 |
|
Adjusted Net Loss |
|
|
|
|
Net loss attributable to controlling interest, as reported |
$ |
(392 |
) |
|
Loss on impairment of assets |
|
167 |
|
|
Loss on retirement of debt |
|
57 |
|
|
Discrete tax items |
|
(19 |
) |
|
Net loss, as adjusted |
$ |
(187 |
) |
|
|
|
|
Adjusted Diluted Loss
Per Share: |
|
|
Diluted loss per share, as
reported |
$ |
(0.64 |
) |
|
Loss on impairment of assets |
|
0.28 |
|
|
Loss on retirement of debt |
|
0.09 |
|
|
Discrete tax items |
|
(0.03 |
) |
|
Diluted loss per share, as adjusted |
$ |
(0.30 |
) |
|
|
YTD |
|
QTD |
|
YTD |
|
QTD |
|
YTD |
|
QTD |
|
YTD |
|
|
12/31/19 |
|
12/31/19 |
|
09/30/19 |
|
09/30/19 |
|
06/30/19 |
|
06/30/19 |
|
03/31/19 |
|
Adjusted Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable to controlling interest, as reported |
$ |
(1,255 |
) |
|
$ |
(51 |
) |
|
$ |
(1,204 |
) |
|
$ |
(825 |
) |
|
$ |
(379 |
) |
|
$ |
(208 |
) |
|
$ |
(171 |
) |
|
Acquisition and restructuring costs |
|
6 |
|
|
|
5 |
|
|
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
Gain on bargain purchase |
|
(11 |
) |
|
|
— |
|
|
|
(11 |
) |
|
|
— |
|
|
|
(11 |
) |
|
|
(9 |
) |
|
|
(2 |
) |
|
Loss on impairment of assets |
|
609 |
|
|
|
25 |
|
|
|
584 |
|
|
|
583 |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
(Gain) loss on disposal of assets, net |
|
5 |
|
|
|
(2 |
) |
|
|
7 |
|
|
|
6 |
|
|
|
1 |
|
|
|
2 |
|
|
|
(1 |
) |
|
Gain on terminated construction contracts |
|
(132 |
) |
|
|
(132 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Loss on retirement of debt |
|
41 |
|
|
|
2 |
|
|
|
39 |
|
|
|
12 |
|
|
|
27 |
|
|
|
9 |
|
|
|
18 |
|
|
Discrete tax items and other, net |
|
(150 |
) |
|
|
(110 |
) |
|
|
(40 |
) |
|
|
(10 |
) |
|
|
(30 |
) |
|
|
(5 |
) |
|
|
(25 |
) |
|
Net loss, as adjusted |
$ |
(887 |
) |
|
$ |
(263 |
) |
|
$ |
(624 |
) |
|
$ |
(234 |
) |
|
$ |
(390 |
) |
|
$ |
(209 |
) |
|
$ |
(181 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Diluted Loss
Per Share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted loss per share, as
reported |
$ |
(2.05 |
) |
|
$ |
(0.08 |
) |
|
$ |
(1.97 |
) |
|
$ |
(1.35 |
) |
|
$ |
(0.62 |
) |
|
$ |
(0.34 |
) |
|
$ |
(0.28 |
) |
|
Acquisition and restructuring costs |
|
0.01 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Gain on bargain purchase |
|
(0.02 |
) |
|
|
— |
|
|
|
(0.02 |
) |
|
|
— |
|
|
|
(0.02 |
) |
|
|
(0.01 |
) |
|
|
— |
|
|
Loss on impairment of assets |
|
0.99 |
|
|
|
0.04 |
|
|
|
0.97 |
|
|
|
0.96 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
(Gain) loss on disposal of assets, net |
|
0.01 |
|
|
|
— |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Gain on terminated construction contracts |
|
(0.22 |
) |
|
|
(0.22 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Loss on retirement of debt |
|
0.07 |
|
|
|
— |
|
|
|
0.06 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0.03 |
|
|
Discrete tax items and other, net |
|
(0.24 |
) |
|
|
(0.18 |
) |
|
|
(0.07 |
) |
|
|
(0.02 |
) |
|
|
(0.05 |
) |
|
|
— |
|
|
|
(0.05 |
) |
|
Diluted loss per share, as
adjusted |
$ |
(1.45 |
) |
|
$ |
(0.43 |
) |
|
$ |
(1.02 |
) |
|
$ |
(0.38 |
) |
|
$ |
(0.64 |
) |
|
$ |
(0.34 |
) |
|
$ |
(0.30 |
) |
|
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
NON-GAAP FINANCIAL MEASURES AND
RECONCILIATIONS |
ADJUSTED CONTRACT DRILLING REVENUES |
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND
AMORTIZATION AND RELATED MARGINS |
(In millions, except percentages) |
|
|
|
|
|
|
|
|
|
YTD |
|
|
03/31/20 |
|
|
|
|
|
Contract drilling revenues |
$ |
759 |
|
|
Contract intangible amortization |
|
48 |
|
|
Adjusted Contract
Drilling Revenues |
$ |
807 |
|
|
|
|
|
|
Net loss |
$ |
(391 |
) |
|
Interest expense, net of interest income |
|
151 |
|
|
Income tax benefit |
|
(4 |
) |
|
Depreciation and amortization |
|
206 |
|
|
Contract intangible amortization |
|
48 |
|
|
EBITDA |
|
10 |
|
|
|
|
|
|
Loss on impairment of assets |
|
168 |
|
|
Loss on retirement of debt |
|
57 |
|
|
Adjusted
EBITDA |
$ |
235 |
|
|
|
|
|
|
|
|
|
|
EBITDA margin |
|
1 |
|
% |
Adjusted EBITDA margin |
|
29 |
|
% |
|
YTD |
|
QTD |
|
YTD |
|
QTD |
|
YTD |
|
QTD |
|
YTD |
|
|
12/31/19 |
|
12/31/19 |
|
09/30/19 |
|
09/30/19 |
|
06/30/19 |
|
06/30/19 |
|
03/31/19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract drilling revenues |
$ |
3,088 |
|
|
$ |
792 |
|
|
$ |
2,296 |
|
|
$ |
784 |
|
|
$ |
1,512 |
|
|
$ |
758 |
|
|
$ |
754 |
|
|
Contract intangible amortization |
|
187 |
|
|
|
47 |
|
|
|
140 |
|
|
|
48 |
|
|
|
92 |
|
|
|
47 |
|
|
|
45 |
|
|
Adjusted Contract
Drilling Revenues |
$ |
3,275 |
|
|
$ |
839 |
|
|
$ |
2,436 |
|
|
$ |
832 |
|
|
$ |
1,604 |
|
|
$ |
805 |
|
|
$ |
799 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(1,257 |
) |
|
$ |
(55 |
) |
|
$ |
(1,202 |
) |
|
$ |
(825 |
) |
|
$ |
(377 |
) |
|
$ |
(206 |
) |
|
$ |
(171 |
) |
|
Interest expense, net of interest income |
|
617 |
|
|
|
150 |
|
|
|
467 |
|
|
|
155 |
|
|
|
312 |
|
|
|
156 |
|
|
|
156 |
|
|
Income tax expense (benefit) |
|
59 |
|
|
|
(24 |
) |
|
|
83 |
|
|
|
54 |
|
|
|
29 |
|
|
|
37 |
|
|
|
(8 |
) |
|
Depreciation and amortization |
|
855 |
|
|
|
207 |
|
|
|
648 |
|
|
|
212 |
|
|
|
436 |
|
|
|
219 |
|
|
|
217 |
|
|
Contract intangible amortization |
|
187 |
|
|
|
47 |
|
|
|
140 |
|
|
|
48 |
|
|
|
92 |
|
|
|
47 |
|
|
|
45 |
|
|
EBITDA |
|
461 |
|
|
|
325 |
|
|
|
136 |
|
|
|
(356 |
) |
|
|
492 |
|
|
|
253 |
|
|
|
239 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition and restructuring costs |
|
6 |
|
|
|
5 |
|
|
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
Loss on impairment of assets |
|
609 |
|
|
|
25 |
|
|
|
584 |
|
|
|
583 |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
(Gain) loss on disposal of assets, net |
|
5 |
|
|
|
(2 |
) |
|
|
7 |
|
|
|
6 |
|
|
|
1 |
|
|
|
2 |
|
|
|
(1 |
) |
|
Gain on bargain purchase |
|
(11 |
) |
|
|
— |
|
|
|
(11 |
) |
|
|
— |
|
|
|
(11 |
) |
|
|
(9 |
) |
|
|
(2 |
) |
|
Loss on retirement of debt |
|
41 |
|
|
|
2 |
|
|
|
39 |
|
|
|
12 |
|
|
|
27 |
|
|
|
9 |
|
|
|
18 |
|
|
Gain on termination of construction contracts |
|
(132 |
) |
|
|
(132 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Adjusted
EBITDA |
|
979 |
|
|
|
223 |
|
|
|
756 |
|
|
|
245 |
|
|
|
511 |
|
|
|
257 |
|
|
|
254 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin |
|
14 |
|
% |
|
39 |
|
% |
|
6 |
|
% |
|
(43 |
) |
% |
|
31 |
|
% |
|
31 |
|
% |
|
30 |
|
% |
Adjusted EBITDA margin |
|
30 |
|
% |
|
27 |
|
% |
|
31 |
|
% |
|
29 |
|
% |
|
32 |
|
% |
|
32 |
|
% |
|
32 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRANSOCEAN LTD. AND SUBSIDIARIES |
SUPPLEMENTAL EFFECTIVE TAX RATE ANALYSIS |
(In millions, except tax rates) |
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
March 31, |
|
December 31, |
|
March 31, |
|
|
2020 |
|
2019 |
|
2019 |
|
Loss before income taxes |
$ |
(395 |
) |
|
$ |
(79 |
) |
|
$ |
(179 |
) |
|
Acquisition and restructuring costs |
|
— |
|
|
|
5 |
|
|
|
— |
|
|
Gain on bargain purchase |
|
— |
|
|
|
— |
|
|
|
(2 |
) |
|
Loss on impairment of assets |
|
168 |
|
|
|
25 |
|
|
|
— |
|
|
Gain on disposal of assets, net |
|
— |
|
|
|
(2 |
) |
|
|
(1 |
) |
|
Gain on terminated construction contracts |
|
— |
|
|
|
(132 |
) |
|
|
— |
|
|
Loss on retirement of debt |
|
57 |
|
|
|
2 |
|
|
|
18 |
|
|
Adjusted loss before income
taxes |
$ |
(170 |
) |
|
$ |
(181 |
) |
|
$ |
(164 |
) |
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit |
$ |
(4 |
) |
|
$ |
(24 |
) |
|
$ |
(8 |
) |
|
Acquisition and restructuring costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
Gain on bargain purchase |
|
— |
|
|
|
— |
|
|
|
— |
|
|
Loss on impairment of assets |
|
1 |
|
|
|
— |
|
|
|
— |
|
|
Gain on disposal of assets, net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
Gain on terminated construction contracts |
|
— |
|
|
|
— |
|
|
|
— |
|
|
Loss on retirement of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
Changes in estimates (1) |
|
19 |
|
|
|
110 |
|
|
|
25 |
|
|
Adjusted income tax
expense |
$ |
16 |
|
|
$ |
86 |
|
|
$ |
17 |
|
|
|
|
|
|
|
|
|
|
|
|
Effective Tax
Rate (2) |
|
1.1 |
|
% |
|
30.3 |
|
% |
|
4.5 |
|
% |
|
|
|
|
|
|
|
|
|
|
Effective Tax Rate,
excluding discrete items (3) |
|
(9.5 |
) |
% |
|
(47.2 |
) |
% |
|
(10.6 |
) |
% |
|
|
|
|
|
|
|
|
|
|
(1) Our estimates change as we file tax returns, settle disputes
with tax authorities or become aware of other events and include
changes in (a) deferred taxes, (b) valuation allowances on deferred
taxes and (c) other tax liabilities. |
|
|
|
|
|
|
|
|
|
|
(2) Our effective
tax rate is calculated as income tax expense divided by income
before income taxes. |
|
|
|
|
|
|
|
|
|
|
(3) Our effective tax rate, excluding discrete items, is calculated
as income tax expense, excluding various discrete items (such as
changes in estimates and tax on items excluded from income before
income taxes), divided by income before income tax expense,
excluding gains and losses on sales and similar items pursuant to
the accounting standards for income taxes related to estimating the
annual effective tax rate. |
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