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$NE 1Q15 10-Q: At March 31, 2015 (vs. Dec. 31, 2014): Cash and cash equivalents were $82.203MM vs. $68.510MM. Working capital was $277MM vs. $260MM. Total debt related to senior unsecured notes was $4.8Bil vs. $3.7Bil. Ratio of debt to total tangible capitalization was circa 0.40. Total debt as a percentage of total debt plus equity was 40.1%.
$NE announced the retirement of Chairman, President and CEO David W. Williams, and the election of Julie J. Robertson to succeed Mr. Williams in such roles. Mr. Williams plans to remain with the company through February 2018, serving in an advisory capacity.
$NE said certain of its subsidiaries have received commitments from lenders to enter into a new credit facility. $NE expects to close on the new credit facility by the end of 2017. The new credit facility is expected to provide borrowing capacity of $1.5Bil with an expected maturity of January 2023.
$NE commented on a complaint filed against the company by the Paragon Litigation Trust in connection with the August 2014 spin-off by Noble of Paragon Offshore. The company reiterated its position that the spin-off was a thoughtfully executed strategy. The company will take all appropriate action to vigorously defend itself.
$NE continues to look for ways to bring down its costs. $NE continues to be much more dynamic in making decisions about stacking rigs, and lowering costs every chance when a rig goes down. $NE delivered about a 55% margin on its revenue for 1Q17. The company will continue to push on its margins and drive as much cash through the system.
Offshore drilling contractor $NE reported a net loss for 1Q17, hurt by the negative impact of a non-cash, discrete tax item of $260MM, or $1.07 per diluted share. $NE reported net loss for the quarter of $301.69MM or $1.24 loss per share compared to a net income of $105.48MM or $0.42 per share a year ago. Revenue fell 40.68% to $362.97MM.
$NE said it is improving its guidance for operating downtime to 4%. On the CapEx front, the company is reducing is guidance for 2017 to $115MM, down from the previous preliminary 2017 guidance of $125MM. In 1Q17, CapEx is expected to total about $35MM.
$NE's CEO David Williams said, "Our industry continues to experience weakness, but Noble's strong base of revenue, which totals more than $1.0Bil in 2017, along with further reductions in contract drilling costs and capital expenditures, should result in another year of positive free cash flow."
$NE reported a wider loss in 4Q16, hurt by lower revenue and a charge of $1.3Bil, or $5.34 per diluted share, relating to the impairment of five rigs and certain other capital spares. Net loss was $1.3Bil or $5.36 per share versus net loss of $152MM or $0.63 per share in the prior year quarter. Revenue dropped 52% to $410MM from $857.7MM in 4Q15.
$NE's BoD approved elimination of its quarterly cash dividend of $0.02 per share, effective immediately. The continuation of challenging fundamentals in offshore drilling industry, which have led to lower fleet utilization, was central to its decision. Elimination is expected to reduce annual cash expenditures of about $20MM.
For 2Q16, $NE said it expects to recognize revenues associated with these two rigs of approx. $431MM, which includes a $348MM termination fee, $52MM related to 2Q16 operations through the date of termination and $31MM for the accelerated recognition of other deferred contractual items.
$NE said its drilling contracts for drillships Noble Sam Croft and Noble Tom Madden with Freeport-McMoRan Oil & Gas and its parent $FCX will be terminated as planned, and $FCX will pay $NE $540MM. In addition, $NE can receive additional payments of $25MM & $50MM respectively, depending upon the average price of oil over a 12 month period.
$RIG, which competes with rivals $NE and $ESV, said that for rigs under contract the company is streamlining maintenance activities, delivering sustainable cost savings, while increasing uptime. To-date, $RIG said its realized savings are ranging between 20-30% for some of company's costliest areas.
$NE announced a decision by its BoD to adjust the company's dividend and declare a quarterly dividend of $0.02 per share. The ex-dividend date for this payment is expected to be April 28, 2016, with a record date of May 2, 2016 and a payment date of May 9, 2016.
$NE will take control of the regulation of Paragon's Mexican income, tax audit and assessment matters for specified years up to 2010. Paragon and $NE will share other income and tax liabilities arising out of such audit process. $NE expects the net amount it will pay over the period of the settlement for its portion of the taxes to be $8-12MM.