[FORM 6-K Filing Details](index=1&type=section&id=FORM%206-K%20Filing%20Details) [Report Information](index=3&type=section&id=INFORMATION%20CONTAINED%20IN%20THIS%20FORM%206-K%20REPORT) This Form 6-K includes Borr Drilling's Unaudited Interim Financial Report for H1 2025, incorporated by reference - The report contains the Unaudited Interim Financial Report for the six months ended June 30, 2025[4](index=4&type=chunk) - Information is incorporated by reference into Form F-3 (Registration Number 333-286490) and Form S-8 (Registration Number 333-283551)[5](index=5&type=chunk) - Exhibit 99.1 is the Unaudited Interim Financial Report[6](index=6&type=chunk) [Signatures](index=4&type=section&id=SIGNATURES) Magnus Vaaler, Principal Financial Officer, signed the report for Borr Drilling on August 13, 2025 - Report signed by Magnus Vaaler, Principal Financial Officer, on August 13, 2025[9](index=9&type=chunk)[10](index=10&type=chunk) [Unaudited Interim Financial Report](index=5&type=section&id=UNAUDITED%20INTERIM%20FINANCIAL%20REPORT) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This section identifies forward-looking statements, their inherent risks, and disclaims update obligations - Forward-looking statements are identified by words like 'may,' 'will,' 'expect,' and include plans, objectives, goals, strategies, future events, and market outlook[13](index=13&type=chunk) - These statements are based on current estimates and assumptions but involve significant known and unknown risks, uncertainties, and contingencies beyond control[14](index=14&type=chunk) - The company disclaims any obligation to update or revise forward-looking statements, except as required by law[15](index=15&type=chunk) [Management Discussion and Analysis](index=7&type=section&id=Management%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) Analysis of Borr Drilling's H1 2025 financial condition and results, covering developments, performance, liquidity [Company Overview](index=7&type=section&id=Overview) Borr Drilling is an offshore shallow-water drilling contractor operating **24 premium jack-up rigs** globally - Borr Drilling Limited is an offshore shallow-water drilling contractor providing services to the oil and gas industry[18](index=18&type=chunk) - Primary business involves ownership, contracting, and operation of jack-up rigs for shallow-water areas (up to 400 feet depth)[18](index=18&type=chunk) - The company's fleet consists of **24 premium jack-up rigs**[18](index=18&type=chunk) [Recent Developments](index=7&type=section&id=Recent%20Developments) Recent developments include share cancellations, a **$102.5 million** public offering, rig operations, and CEO succession [Liquidity Updates](index=7&type=section&id=Liquidity%20Updates) - In March 2025, **19,680,391** treasury shares related to the Convertible Notes share lending agreement were cancelled[19](index=19&type=chunk) - On July 3, 2025, a public offering of **50,000,000 shares** at **$2.05 per share** raised total gross proceeds of **$102.5 million**[20](index=20&type=chunk) - Shareholders approved an increase in authorized share capital by **50,000,000** new common shares to **365,000,000** shares in August 2025[21](index=21&type=chunk) [Operational and Contract Updates](index=7&type=section&id=Operational%20and%20Contract%20Updates) - The Vali rig commenced its first contract in March 2025 after delivery in August 2024[22](index=22&type=chunk) - In May 2025, jack-up rigs 'Galar', 'Grid', and 'Gersemi' re-commenced operations in Mexico after temporary suspension[23](index=23&type=chunk) - The 'Odin' rig received a temporary suspension notice in Mexico in June 2025, but the Company entered an LOI for a combined accommodation and drilling program for it[23](index=23&type=chunk) [Management Updates](index=7&type=section&id=Management%20Updates) - Bruno Morand will succeed Patrick Schorn as CEO, effective September 1, 2025, with Mr. Schorn becoming Executive Chair[24](index=24&type=chunk) - Current Chairman Tor Olav Trøim will continue as a Director, and Dan Rabun will become Lead Independent Director[25](index=25&type=chunk) - Thiago Mordehachvili was appointed to the Board as a Director on August 6, 2025[25](index=25&type=chunk) [Operating and Financial Review](index=9&type=section&id=Operating%20and%20Financial%20Review) H1 2025 net and operating income decreased due to lower revenues, higher rig expenses, and depreciation Selected Financial Information (Six months ended June 30, 2025 vs. 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total operating revenues | 484.3 | 505.9 | (21.6) | (4) % | | Rig operating and maintenance expenses | (232.0) | (228.1) | (3.9) | 2 % | | Depreciation of non-current assets | (72.6) | (63.7) | (8.9) | 14 % | | General and administrative expenses | (23.4) | (25.0) | 1.6 | (6) % | | Total operating expenses | (328.0) | (316.8) | (11.2) | 4 % | | Operating income | 156.7 | 189.5 | (32.8) | (17)% | | (Loss) / income from equity method investments | (2.0) | 2.9 | (4.9) | (169) % | | Total financial expenses, net | (119.1) | (113.2) | (5.9) | 5 % | | Income before income taxes | 35.6 | 79.2 | (43.6) | (55)% | | Income tax expense | (17.4) | (33.1) | 15.7 | (47) % | | Net income | 18.2 | 46.1 | (27.9) | (61)% - Net income decreased by **$27.9 million (61%)** to **$18.2 million** for the six months ended June 30, 2025, primarily due to decreased operating revenue, increased rig operating expenses, higher depreciation, and a loss from equity method investments[28](index=28&type=chunk) - Total operating revenues decreased by **$21.6 million (4%)** to **$484.3 million**, mainly due to a **$35.0 million** decrease in related party revenue (Perfomex termination) and a **$10.0 million** decrease in bareboat charter revenue due to temporary rig suspensions, partially offset by a **$19.4 million** increase in dayrate revenue from higher average dayrates and more rigs in operation[29](index=29&type=chunk)[30](index=30&type=chunk) - Rig operating and maintenance expenses increased by **$3.9 million (2%)** to **$232.0 million**, driven by new rig management contracts, temporary suspension of rigs (expenses previously in equity method investments), and the Vali rig commencing operations[32](index=32&type=chunk) [Liquidity and Capital Resources](index=11&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, Borr Drilling had **$92.4 million** cash, **$2,112.3 million** debt, **$134.7 million** maturing in 12 months - As of June 30, 2025, cash and cash equivalents were **$92.4 million**, with **$1.0 million** in restricted cash[40](index=40&type=chunk) - The company's shares are listed on the NYSE, having delisted from the OSE on December 30, 2024[41](index=41&type=chunk) [Cash Distributions](index=13&type=section&id=Cash%20Distributions) Cash Distributions per Share | Date of Cash Distribution Declaration | Date of Payment to Shareholders | Cash Distribution per Share ($) | | :--- | :--- | :--- | | December 22, 2023 | January 22, 2024 | $0.05 | | February 22, 2024 | March 18, 2024 | $0.05 | | May 22, 2024 | June 17, 2024 | $0.10 | | August 14, 2024 | September 6, 2024 | $0.10 | | November 6, 2024 | December 16, 2024 | $0.02 | | February 19, 2025 | March 19, 2025 | $0.02 | [Borrowing Activities](index=13&type=section&id=Borrowing%20Activities) - Total principal amount of debt outstanding was **$2,112.3 million** as of June 30, 2025, with **$134.7 million** maturing within the next twelve months[43](index=43&type=chunk) - The adjusted conversion price for Convertible Bonds due 2028 is **$6.9376 per share**, convertible into **34,507,611** shares[44](index=44&type=chunk) [Cash Flows](index=13&type=section&id=Cash%20Flows) Cash Flow Information (Six months ended June 30, 2025 vs. 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | 145.0 | 39.9 | 105.1 | 263 % | | Net cash used in investing activities | (38.5) | (32.1) | (6.4) | 20 % | | Net cash (used in) / provided by financing activities | (75.6) | 84.1 | (159.7) | (190)% | | Net increase in cash and cash equivalents and restricted cash | 30.9 | 91.9 | (61.0) | (66)% | | Cash and cash equivalents and restricted cash at beginning of period | 62.5 | 102.6 | (40.1) | (39)% | | Cash and cash equivalents and restricted cash at end of period | 93.4 | 194.5 | (101.1) | (52)% - Net cash provided by operating activities increased by **$105.1 million (263%)** to **$145.0 million**, primarily due to working capital movements, including **$119.9 million** from Mexico operations, and increased average dayrates[46](index=46&type=chunk) - Net cash used in financing activities was **$75.6 million**, a **$159.7 million** decrease from **$84.1 million** provided in 2024, primarily due to debt repayments (**$70.7 million**) and cash distributions (**$4.7 million**) in 2025, compared to net proceeds from 2028 Notes (**$208.3 million**) in 2024[49](index=49&type=chunk) - Cash interest paid increased to **$104.4 million** for the six months ended June 30, 2025, from **$91.3 million** in 2024[50](index=50&type=chunk) [Non-GAAP Financial Measures](index=15&type=section&id=Non-GAAP%20Financial%20Measures) This section defines Adjusted EBITDA, its calculation, rationale, and limitations for business performance comparability Adjusted EBITDA Reconciliation (Six months ended June 30, 2025 vs. 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net income | 18.2 | 46.1 | (27.9) | (61) % | | Depreciation of non-current assets | 72.6 | 63.7 | 8.9 | 14 % | | Loss / (Income) from equity method investments | 2.0 | (2.9) | 4.9 | (169) % | | Total financial expenses, net | 119.1 | 113.2 | 5.9 | 5 % | | Income tax expense | 17.4 | 33.1 | (15.7) | (47) % | | Adjusted EBITDA | 229.3 | 253.2 | (23.9) | (9)% - Adjusted EBITDA decreased by **$23.9 million (9%)** to **$229.3 million** for the six months ended June 30, 2025[38](index=38&type=chunk) - Adjusted EBITDA is presented to increase comparability of underlying business performance and is calculated by adjusting net income for depreciation, equity method investments, financial expenses, and income tax expense[38](index=38&type=chunk)[53](index=53&type=chunk) - Non-GAAP measures have limitations, including not reflecting cash requirements for capital, taxes, working capital, or debt service, and should not be considered in isolation from GAAP results[53](index=53&type=chunk) [Index to Financial Statements](index=16&type=section&id=Borr%20Drilling%20Limited%20Index%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section indexes the unaudited condensed consolidated financial statements, including operations, balance sheets, cash flows Financial Statement Index | Document | Page | | :--- | :--- | | Unaudited Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 | 17 | | Unaudited Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 | 18 | | Unaudited Condensed Consolidated Statements of Cash Flows for the three and six months ended June 30, 2025 and 2024 | 19 | | Unaudited Condensed Consolidated Statements of Changes in Shareholders' Equity for the three and six months ended June 30, 2025 and 2024 | 22 | | Notes to the Unaudited Condensed Consolidated Financial Statements | 23 | [Condensed Consolidated Statements of Operations](index=17&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Net income decreased to **$18.2 million** in H1 2025 from **$46.1 million** in 2024, due to lower revenues and higher expenses Condensed Consolidated Statements of Operations (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Total operating revenues | 484.3 | 505.9 | | Total operating expenses | (328.0) | (316.8) | | Operating income | 156.7 | 189.5 | | Total financial expenses, net | (119.1) | (113.2) | | Income before income taxes | 35.6 | 79.2 | | Income tax expense | (17.4) | (33.1) | | Net income attributable to shareholders of Borr Drilling Limited | 18.2 | 46.1 | | Basic income per share | 0.08 | 0.18 | | Diluted income per share | 0.08 | 0.18 | [Condensed Consolidated Balance Sheets](index=18&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$3,351.7 million** at June 30, 2025, while equity increased to **$1,012.6 million** Condensed Consolidated Balance Sheets (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | 468.3 | 516.6 | | Total non-current assets | 2,883.4 | 2,903.0 | | Total assets | 3,351.7 | 3,419.6 | | Total current liabilities | 367.1 | 409.6 | | Total non-current liabilities | 1,972.0 | 2,016.7 | | Total liabilities | 2,339.1 | 2,426.3 | | Total equity | 1,012.6 | 993.3 | - Cash and cash equivalents increased to **$92.4 million** at June 30, 2025, from **$61.6 million** at December 31, 2024[59](index=59&type=chunk) - Jack-up drilling rigs, net, decreased slightly to **$2,792.4 million** from **$2,823.2 million**[59](index=59&type=chunk) - Due from related parties significantly decreased to **$6.4 million** from **$85.1 million**[59](index=59&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=19&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations increased to **$145.0 million** in H1 2025, while financing activities shifted to outflow Condensed Consolidated Statements of Cash Flows (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | 145.0 | 39.9 | | Net cash used in investing activities | (38.5) | (32.1) | | Net cash (used in) / provided by financing activities | (75.6) | 84.1 | | Net increase in cash and cash equivalents and restricted cash | 30.9 | 91.9 | | Cash, cash equivalents and restricted cash at end of period | 93.4 | 194.5 | - Net cash provided by operating activities increased by **$105.1 million (263%)** to **$145.0 million**, driven by working capital movements and cash settlements from Mexico operations[61](index=61&type=chunk) - Net cash used in financing activities was **$75.6 million** in 2025, a significant change from **$84.1 million** provided in 2024, reflecting debt repayments and cash distributions[61](index=61&type=chunk) - Cash interest paid was **$104.4 million** in 2025, up from **$91.3 million** in 2024[61](index=61&type=chunk) [Condensed Consolidated Statements of Changes in Shareholders' Equity](index=22&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) Total equity increased to **$1,012.6 million** at June 30, 2025, driven by comprehensive income and share-based compensation Condensed Consolidated Statements of Changes in Shareholders' Equity (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Common shares | 24.5 | 26.5 | | Treasury shares | (20.0) | (20.9) | | Additional paid in capital | 347.7 | 340.8 | | Contributed surplus | 1,919.0 | 1,923.7 | | Accumulated deficit | (1,258.6) | (1,276.8) | | Total equity | 1,012.6 | 993.3 | - Cancellation of **19,680,391** treasury shares occurred during the six months ended June 30, 2025[66](index=66&type=chunk)[145](index=145&type=chunk) - Share-based compensation contributed **$3.4 million** to additional paid-in capital for the six months ended March 31, 2025, and **$2.6 million** for the three months ended June 30, 2025[66](index=66&type=chunk) - Cash distributions to shareholders totaled **$4.7 million** for the six months ended June 30, 2025[66](index=66&type=chunk) [Note 1 - General Information](index=23&type=section&id=Note%201%20-%20General%20Information) Borr Drilling, a Bermuda-based offshore drilling contractor, operates **24 premium jack-up rigs** and is NYSE-listed - Borr Drilling Limited is an international offshore drilling contractor providing services to the oil and gas industry[68](index=68&type=chunk) - The company's primary business is the ownership, contracting, and operation of **24 modern jack-up drilling rigs** for shallow-water areas[68](index=68&type=chunk) - Listed on the NYSE under 'BORR', and delisted from the Oslo Stock Exchange on December 30, 2024[68](index=68&type=chunk) [Note 2 - Basis of Preparation and Accounting Policies](index=23&type=section&id=Note%202%20-%20Basis%20of%20Preparation%20and%20Accounting%20Policies) Financial statements are prepared under U.S. GAAP in U.S. dollars, based on a going concern, with consistent policies - Financial statements are prepared in accordance with U.S. GAAP and presented in millions of U.S. dollars[70](index=70&type=chunk) - Prepared on a going concern basis, with all necessary adjustments for fair presentation reflected[70](index=70&type=chunk) - Accounting policies are consistent with those in the annual audited consolidated financial statements for the year ended December 31, 2024[72](index=72&type=chunk) [Note 3 - Recently Issued Accounting Standards](index=23&type=section&id=Note%203%20-%20Recently%20Issued%20Accounting%20Standards) This note details new accounting standards (ASU 2023-05, ASU 2023-09) effective January 1, 2025, with no material interim impact - ASU 2023-05 (Business Combinations—Joint Venture Formations) requires joint ventures to apply a new basis of accounting upon formation, recognizing assets and liabilities at fair value, effective January 1, 2025, with no current impact[74](index=74&type=chunk) - ASU 2023-09 (Income Taxes) requires enhanced income tax disclosures for public business entities, effective January 1, 2025, for the 2025 annual report, with no current impact[75](index=75&type=chunk) - ASU 2024-03 (Expense Disaggregation Disclosures) and ASU 2024-04 (Debt—Debt with Conversion and Other Options) have been issued but not yet adopted, with ASU 2024-03 expected to impact disclosures from January 1, 2027[76](index=76&type=chunk) [Note 4 - Segment Information](index=25&type=section&id=Note%204%20-%20Segment%20Information) Borr Drilling operates as a single segment, with revenues geographically attributed, showing shifts in regional contributions - The company operates as a single reportable segment, with Operating income as the key metric for management[77](index=77&type=chunk) - Revenues are attributed to geographical location based on the country of operations for drilling activities[78](index=78&type=chunk) Revenues by Geographic Area (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | South East Asia | 151.6 | 138.5 | | West Africa | 140.1 | 76.7 | | Latin America | 90.5 | 146.5 | | North Africa | 29.3 | — | | Middle East | 42.8 | 129.3 | | Europe | 30.0 | 14.9 | | Total | 484.3 | 505.9 | Major Customers (Six months ended June 30) | In % of operating revenues | 2025 | 2024 | | :--- | :--- | :--- | | ENI S.p.A | 22 % | 11 % | | PTT Exploration and Production Public Company Limited | 13 % | 10 % | | Saudi Arabian Oil Company | 6 % | 16 % | | Total | 41 % | 37 % | Net Book Value of Jack-up Rigs by Geographic Area (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Latin America | 953.1 | 961.0 | | South East Asia | 796.9 | 809.9 | | West Africa | 429.2 | 434.8 | | Middle East | 358.4 | 366.6 | | North Africa | 163.7 | — | | Europe | 91.1 | 250.9 | | Total | 2,792.4 | 2,823.2 | [Note 5 - Contracts with Customers](index=26&type=section&id=Note%205%20-%20Contracts%20with%20Customers) Contract assets increased to **$150.4 million** and liabilities to **$80.2 million**; future dayrate revenue projected at **$743.8 million** for 2026 - Accrued revenue is recognized when the right to consideration becomes unconditional, and trade accounts receivable are recognized upon billing[81](index=81&type=chunk) - Deferred mobilization, demobilization, and contract preparation revenue are recognized on a straight-line basis over the initial firm term of contracts[82](index=82&type=chunk) Contract Assets and Liabilities (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total contract assets | 150.4 | 109.2 | | Total contract liabilities | (80.2) | (48.1) | Timing of Revenue Recognition (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Over time | 467.6 | 492.7 | | Point in time | 16.7 | 13.2 | | Total | 484.3 | 505.9 | Expected Future Revenue from Unsatisfied Performance Obligations (as of June 30, 2025) | In $ millions | 2026 | 2027 | 2028 | 2029 onwards | | :--- | :--- | :--- | :--- | :--- | | Dayrate revenue | 700.5 | 239.0 | 111.4 | 54.5 | | Other revenue | 43.3 | 20.6 | 14.8 | 7.6 | | Total | 743.8 | 259.6 | 126.2 | 62.1 | [Note 6 - Equity Method Investments](index=29&type=section&id=Note%206%20-%20Equity%20Method%20Investments) Borr Drilling holds a **51% equity interest** in Mexican JVs; operating structure changed in 2024, leading to rig operational changes in 2025 - Borr Drilling holds a **51% equity ownership interest** in Perfomex and Perfomex II, Mexico-based joint ventures[89](index=89&type=chunk) - In 2024, bareboat charter agreements with Perfomex were terminated, and new fixed-rate bareboat charter agreements were entered into with Irish Energy Drilling Assets, DAC ('Irco') for five jack-up rigs[90](index=90&type=chunk) - In January 2025, 'Grid', 'Gersemi', and 'Galar' rigs received temporary suspension notices but re-commenced operations during Q2 2025, with charter agreements extended[93](index=93&type=chunk) Investments in Equity Method Investments (as of June 30, 2025) | In $ millions | Perfomex | Perfomex II | Borr Total | | :--- | :--- | :--- | :--- | | Balance as of December 31, 2024 | 9.1 | 5.4 | 14.5 | | Equity share in loss of investee | (2.0) | — | (2.0) | | Balance as of June 30, 2025 | 7.1 | 5.4 | 12.5 | [Note 7 - Interest Expense](index=30&type=section&id=Note%207%20-%20Interest%20Expense) Total interest expense increased to **$115.3 million** in H1 2025 from **$101.0 million** in 2024, due to higher debt interest and amortization Interest Expense Components (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Debt interest expense | (106.9) | (92.4) | | Amortization of deferred finance charges | (6.4) | (5.5) | | Amortization of debt discount | (3.4) | (3.4) | | Amortization of debt premium | 1.4 | 0.3 | | Total | (115.3) | (101.0) | [Note 8 - Other Financial Expenses, net](index=30&type=section&id=Note%208%20-%20Other%20Financial%20Expenses%2C%20net) Other financial expenses, net, decreased to **$4.9 million** in H1 2025 from **$16.0 million** in 2024, due to no yard cost cover and FX gain Other Financial Expenses, Net (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Foreign exchange gain / (loss) | 1.5 | (2.3) | | Yard cost cover expense | — | (11.2) | | Unrealized changes in value of financial instruments | — | 0.3 | | Other financial (expenses) / income | (4.3) | (0.9) | | Bank commitment, guarantee and other fees | (2.1) | (1.9) | | Total | (4.9) | (16.0) | - Other financial expenses for 2025 include **$4.4 million** in financing fees related to Mexican customer payment settlement[97](index=97&type=chunk) - The 2024 figures included **$2.3 million** premium paid on repurchased Convertible Bonds[97](index=97&type=chunk) [Note 9 - Taxation](index=30&type=section&id=Note%209%20-%20Taxation) Income tax expense decreased to **$17.4 million** in H1 2025 from **$33.1 million** in 2024, due to lower corporate tax and a deferred tax benefit - Borr Drilling Limited is a Bermuda company, exempt from Bermuda taxes until March 31, 2035, but expects to be subject to **Bermuda's 15% Corporate Income Tax Act** from January 1, 2025, and OECD's Pillar Two global minimum tax in 2026[98](index=98&type=chunk)[103](index=103&type=chunk) Pre-tax Income / (Loss) by Jurisdiction (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Bermuda | 67.0 | (49.2) | | Foreign | (31.4) | 128.4 | | Total | 35.6 | 79.2 | Income Tax (Expense) / Benefit (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Current tax | (23.4) | (28.7) | | Change in deferred tax | 6.0 | (4.4) | | Total | (17.4) | (33.1) | - The decrease in income tax expense is principally due to a **$6.3 million** decrease in corporate income tax, a **$5.7 million** one-off recognition of deferred tax benefit, and a **$3.7 million** decrease in deferred tax asset utilization[37](index=37&type=chunk) [Note 10 - Income Per Share](index=31&type=section&id=Note%2010%20-%20Income%20Per%20Share) Basic and diluted income per share was **$0.08** in H1 2025, down from **$0.18** in 2024, reflecting dilutive and anti-dilutive effects Income Per Share (Six months ended June 30) | | 2025 | 2024 | | :--- | :--- | :--- | | Basic income per share | 0.08 | 0.18 | | Diluted income per share | 0.08 | 0.18 | | Issued ordinary shares at the end of the period | 244,400,000 | 264,080,391 | | Net income - basic (in $ millions) | 18.2 | 46.1 | | Weighted average numbers of shares outstanding for the period, basic | 241,134,285 | 251,953,928 | | Weighted average numbers of shares outstanding for the period, diluted | 242,362,500 | 289,349,337 | - For the six months ended June 30, 2025, **3,931,663** share options were included as dilutive, while **34,507,611** shares issuable from Convertible Bonds, **8,689,997** share options, **750,000** performance stock units, and **886,610** restricted share units were excluded as anti-dilutive[105](index=105&type=chunk)[110](index=110&type=chunk) - Weighted average shares outstanding include shares from a share lending arrangement related to Convertible Bonds[108](index=108&type=chunk) [Note 11 - Other Current Assets](index=33&type=section&id=Note%2011%20-%20Other%20Current%20Assets) Other current assets increased to **$30.8 million** at June 30, 2025, from **$28.0 million**, mainly due to higher tax receivables Other Current Assets (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Other tax receivables | 13.1 | 8.0 | | Client rechargeables | 6.8 | 5.0 | | VAT receivable | 4.6 | 10.5 | | Deferred financing fee | 0.5 | 0.5 | | Right-of-use lease asset | 0.3 | 0.4 | | Other receivables | 5.5 | 3.6 | | Total | 30.8 | 28.0 | [Note 12 - Jack-Up Rigs](index=33&type=section&id=Note%2012%20-%20Jack-Up%20Rigs) Net carrying value of jack-up rigs decreased to **$2,792.4 million** at June 30, 2025, with additions offset by depreciation Carrying Value of Jack-Up Rigs (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Opening balance | 2,823.2 | 2,578.3 | | Additions | 41.2 | 64.6 | | Depreciation and amortization | (72.0) | (130.1) | | Transfers from Newbuildings | — | 310.4 | | Total | 2,792.4 | 2,823.2 | - Accumulated depreciation related to jack-up rigs was **$800.2 million** at June 30, 2025, up from **$728.2 million** at December 31, 2024[113](index=113&type=chunk) - Impairment indicators existed for fourteen rigs, but no impairment loss was recognized as estimated undiscounted net cash flows were higher than carrying amounts[117](index=117&type=chunk) [Note 13 - Leases](index=35&type=section&id=Note%2013%20-%20Leases) Operating lease assets and liabilities were **$0.9 million** each; bareboat charter revenue was **$27.9 million**, with **$134.1 million** future revenues Supplemental Balance Sheet Information Related to Leases (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Operating leases right-of-use assets | 0.9 | 1.2 | | Current operating lease liabilities | 0.3 | 0.4 | | Non-current operating lease liabilities | 0.6 | 0.8 | Operating Lease Expense (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Rig operating and maintenance expenses | 8.3 | 6.3 | | General and administrative expenses | 1.2 | 1.0 | | Operating lease expense | 9.5 | 7.3 | - Bareboat charter revenue from operating leases on jack-up rigs was **$27.9 million** for the six months ended June 30, 2025, and **$37.9 million** for the same period in 2024[122](index=122&type=chunk) Minimum Future Revenues from Operating Leases on Jack-Up Rigs (as of June 30, 2025) | In $ millions | June 30, 2025 | | :--- | :--- | | 2025 | 55.2 | | 2026 | 48.0 | | 2027 | 24.4 | | 2028 | 6.5 | | Total minimum contractual future revenues | 134.1 | [Note 14 - Other Non-Current Assets](index=37&type=section&id=Note%2014%20-%20Other%20Non-Current%20Assets) Other non-current assets increased to **$76.2 million** at June 30, 2025, from **$62.5 million**, driven by deferred tax assets Other Non-Current Assets (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Deferred mobilization and contract preparation costs | 37.2 | 39.5 | | Deferred tax asset | 24.6 | 18.6 | | Deferred demobilization revenue | 10.4 | 1.5 | | Blended rate revenue, non-current | 1.8 | — | | Deferred financing fee | 1.0 | 1.2 | | Right-of-use lease asset, non-current | 0.6 | 0.8 | | Customer retention | 0.6 | — | | Prepayments | — | 0.9 | | Total | 76.2 | 62.5 | [Note 15 - Accrued Expenses](index=37&type=section&id=Note%2015%20-%20Accrued%20Expenses) Accrued expenses decreased to **$65.0 million** at June 30, 2025, from **$68.0 million**, mainly due to lower payroll and bonus Accrued Expenses (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Accrued goods and services received, not invoiced | 13.7 | 14.2 | | Accrued payroll and bonus | 7.9 | 13.2 | | Other accrued expenses | 43.4 | 40.6 | | Total | 65.0 | 68.0 | [Note 16 - Other Current Liabilities](index=38&type=section&id=Note%2016%20-%20Other%20Current%20Liabilities) Other current liabilities decreased to **$47.7 million** at June 30, 2025, from **$84.2 million**, due to reductions in VAT and other taxes Other Current Liabilities (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Advances from customers | 18.8 | 15.9 | | Other current taxes payable | 12.9 | 19.6 | | Corporate income taxes payable | 10.6 | 14.3 | | VAT payable | 2.3 | 28.2 | | Accrued payroll and severance | 1.6 | 1.4 | | Operating lease liability, current | 0.3 | 0.4 | | Other current liabilities | 1.2 | 4.4 | | Total | 47.7 | 84.2 | [Note 17 - Debt](index=38&type=section&id=Note%2017%20-%20Debt) Total principal debt was **$2,112.3 million** at June 30, 2025, with **$134.7 million** short-term, and a **9.8%** weighted average interest rate Short-Term Debt (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Principal Outstanding | 134.7 | 134.7 | | Carrying Value Short-Term Debt | 118.1 | 118.1 | Long-Term Debt (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Principal Outstanding | 1,977.6 | 2,044.9 | | Carrying Value Long-Term Debt | 1,933.4 | 1,992.5 | Scheduled Debt Maturities (as of June 30, 2025) | In $ millions | Maturities | | :--- | :--- | | 2025 | 67.4 | | 2026 | 134.7 | | 2027 | 134.7 | | 2028 | 1,249.7 | | 2029 | 33.7 | | Thereafter | 492.1 | | Total principal debt | 2,112.3 | - The adjusted conversion price for the Convertible Bonds due 2028 is **$6.9376 per share**, convertible into **34,507,611** shares[130](index=130&type=chunk) - The weighted average nominal interest rate for all interest-bearing debt was **9.8%** for the six months ended June 30, 2025 (**9.7%** in 2024)[131](index=131&type=chunk) - As of June 30, 2025, the company was in compliance with all covenants and obligations under its debt agreements[132](index=132&type=chunk) [Note 18 - Commitments and Contingencies](index=40&type=section&id=Note%2018%20-%20Commitments%20and%20Contingencies) Commercial commitments totaled **$36.0 million** at June 30, 2025, with **$2,792.4 million** in jack-up rigs pledged as collateral Guarantee Commitments (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Bank guarantees, letters of credit and performance bonds | 36.0 | 42.9 | | Total | 36.0 | 42.9 | Expected Expiration Dates of Guarantee Obligations (as of June 30, 2025) | In $ millions | Less than 1 year | 2–3 years | 4-5 years | Thereafter | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Bank guarantees and performance bonds | 30.4 | — | 5.0 | 0.6 | 36.0 | Assets Pledged as Collateral (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Book value of jack-up rigs pledged as collateral for debt facilities | 2,792.4 | 2,671.7 | [Note 19 - Related Party Transactions](index=41&type=section&id=Note%2019%20-%20Related%20Party%20Transactions) Related party revenue from Perfomex ceased in 2025; support expenses increased to **$2.8 million**, receivables decreased to **$6.4 million** - Bareboat charter agreements with Perfomex were terminated in 2024, and new fixed-rate bareboat charter agreements were entered into with an unrelated party for five jack-up rigs[135](index=135&type=chunk) Bareboat Revenue from Related Parties (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Bareboat Revenue - Perfomex | — | 35.0 | | Total | — | 35.0 | Onshore Operational and Technical Support Expenses from Perfomex (Six months ended June 30) | In $ millions | 2025 | 2024 | | :--- | :--- | :--- | | Onshore Operational and Technical Support - Perfomex | 2.8 | 1.8 | | Total | 2.8 | 1.8 | Receivables from Joint Ventures (as of June 30, 2025 vs. December 31, 2024) | In $ millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Perfomex | 6.4 | 85.1 | | Total | 6.4 | 85.1 | [Note 20 - Fair Value of Financial Instruments](index=43&type=section&id=Note%2020%20-%20Fair%20Value%20of%20Financial%20Instruments) This note outlines the fair value hierarchy for financial instruments (Level 1, Level 2), with debt fair valued using Level 2 inputs - Fair value estimates are recognized using a hierarchy: Level 1 for quoted market prices in active markets, Level 2 for observable market-based inputs, and Level 3 for unobservable inputs[140](index=140&type=chunk)[141](index=141&type=chunk) Carrying Value and Estimated Fair Value of Financial Instruments (as of June 30, 2025) | In $ millions | Hierarchy | Fair value | Carrying value | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash and cash equivalents | 1 | 92.4 | 92.4 | | Restricted cash | 1 | 1.0 | 1.0 | | Trade receivables | 1 | 149.2 | 149.2 | | Other current assets (excluding deferred costs and right-of-use lease asset) | 1 | 30.0 | 30.0 | | Due from related parties | 1 | 6.4 | 6.4 | | **Liabilities** | | | | | Trade payables | 1 | 63.8 | 63.8 | | Accrued expenses | 1 | 65.0 | 65.0 | | Short term accrued interest and other items | 1 | 29.7 | 29.7 | | Other current liabilities | 1 | 47.7 | 47.7 | | Short-term debt | 2 | 121.1 | 134.7 | | Long-term debt | 2 | 1,737.9 | 1,977.6 | - The unamortized amount of issuance costs associated with the Share Lending Framework Agreement (SLFA) was **$6.5 million** as of June 30, 2025[142](index=142&type=chunk) [Note 21 - Common Shares](index=43&type=section&id=Note%2021%20-%20Common%20Shares) As of June 30, 2025, Borr Drilling had **244,400,000** issued shares; **19,680,391** treasury shares were cancelled, and **$0.02 per share** cash distributions were declared - As of June 30, 2025, authorized shares were **315,000,000**, issued shares were **244,400,000**, and outstanding shares were **236,224,866**[143](index=143&type=chunk)[145](index=145&type=chunk) - During the six months ended June 30, 2025, **19,680,391** issued shares held in treasury were cancelled following the OSE delisting and amendments to the SLFA[145](index=145&type=chunk)[147](index=147&type=chunk)[148](index=148&type=chunk) - As of June 30, 2025, **2,208,734** shares were outstanding under the SLFA, with **8,651,955** shares returned to the company and not available for re-loaning[148](index=148&type=chunk) - Cash distributions of **$0.02 per share** were declared in February 2025, totaling **$4.7 million**[153](index=153&type=chunk) [Note 22 - Subsequent Events](index=47&type=section&id=Note%2022%20-%20Subsequent%20Events) Post-June 30, 2025, a public offering of **50,000,000 shares** at **$2.05 per share** raised **$102.5 million**, with authorized capital increased - On July 3, 2025, a public offering of **50,000,000 shares** at **$2.05 per share** was conducted, generating **$102.5 million** in gross proceeds[155](index=155&type=chunk) - The offering proceeds were received in two settlements: **$30,000,000** shares on July 7, 2025, and **$20,000,000** shares on August 7, 2025[155](index=155&type=chunk) - Shareholders approved an increase in authorized share capital by **50,000,000** new common shares (from **315,000,000** to **365,000,000**) on August 6, 2025, to support the public offering[156](index=156&type=chunk)

Core Points - Borr Drilling Limited plans to release its financial results for the second quarter of 2025 on August 13, 2025, after the close of the New York Stock Exchange [1] - A conference call and webcast are scheduled for August 14, 2025, at 9:00 AM New York Time [1] - Participants are encouraged to join the call 10 minutes early [1] Access Information - The earnings report, webcast, and presentation will be available on the Investor Relations section of the company's website [2] - Participants can access the webcast through a provided link [2] - Registration for the conference call is available via a separate link, with dial-in details sent to participants [2] Replay Information - A replay of the conference call will be available for streaming after the call concludes [3] - Contact information for inquiries is provided, including the CFO's contact details [3]

Group 1 - U.S. stock futures showed slight increases, with Dow futures up approximately 0.1% [1] - Franklin Covey Co. reported disappointing third-quarter results, leading to a significant drop in its stock price [1][2] - The company posted a quarterly loss of $0.11 per share, missing the analyst consensus estimate of a loss of $0.04 per share [2] - Quarterly sales for Franklin Covey were $67.121 million, which also fell short of the analyst consensus estimate of $67.491 million [2] - Following the earnings report, Franklin Covey shares fell by 10.1% to $21.72 in pre-market trading [2] Group 2 - Noah Holdings Limited saw its shares decline by 7.3% to $11.69 in pre-market trading [4] - Scage Future American Depositary Shares experienced a drop of 6.3% to $5.20 after a previous surge of over 34% [4] - Borr Drilling Ltd. shares fell by 4.7% to $2.01 following the announcement of a $100 million offering of approximately 50 million shares [4] - Lithium Argentina AG shares decreased by 4.7% to $2.23 after an 11% gain the previous day [4] - Bitmine Immersion Technologies, Inc. saw a decline of 4.6% to $55.81 after a 27% increase on Wednesday [4] - Northern Dynasty Minerals Ltd. shares dropped by 4.2% to $1.36 after a 4% decline the day before [4]

Core Viewpoint - Borr Drilling Limited plans to raise $100 million through a public offering of approximately 50 million shares for general corporate purposes [1] Group 1: Offering Details - The offering will be conducted under an effective shelf registration statement filed with the SEC on April 11, 2025 [3] - The offering is expected to include two settlements: 30 million shares on July 7, 2025, and 20 million shares on August 7, 2025, contingent on a special general meeting [4] - Certain officers and directors of the Company, including Mr. Tor Olav Trøim, Mr. Patrick Schorn, and Mr. Bruno Morand, have indicated intentions to purchase shares totaling $11.3 million [5] Group 2: Underwriters - DNB Carnegie, Clarksons Securities, Citigroup, and Goldman Sachs & Co. LLC are the joint bookrunners for the offering [2]

Core Insights - Borr Drilling Limited has secured new contract commitments for four premium jack-up rigs, increasing the total number of contracted rigs to 23 out of a fleet of 24 [1] - The new contracts have a combined duration of approximately 1,300 days and are expected to generate over $129 million in revenue, enhancing revenue visibility and contract coverage [2] Contract Details - In the Middle East, the rig 'Arabia II' has received a binding Letter of Award for a contract starting in September 2025, with a firm duration of 500 days and an additional 200-day unpriced option [3] - In Southeast Asia, rigs 'Thor' and 'Gunnlod' have secured contracts with estimated durations of 240 days and 100 days respectively, both including fixed priced optional wells [4] - In Mexico, the rig 'Odin' is transitioning to a 60-day accommodation program after a temporary suspension, with options for drilling works extending the contract through Q2 2026 [5] Year-to-Date Performance - Year to date 2025, the company has secured 13 new commitments totaling 3,010 potential contract days and $366 million in potential contract revenues [6]

Fleet and Operations - The company has a modern jackup fleet with an average age of approximately 6 years[7] - The fleet utilization is at 100%[7] - The company's Q2 2023 Adjusted EBITDA margin was 45%[7] - The company's contract backlog is $1.83 billion[7] - The company's Q2 2023 technical uptime was 98.7%[37] Market Dynamics - Modern jackup rig utilization is back at 2014 levels, reaching 93.7%[13] - Over 30% of the global jackup fleet is over 30 years old, with over 150 jackups retired since 2015, averaging 38 years of age at retirement[18] - The orderbook for new jackup rigs is at a record low, representing approximately 3% of the total fleet[22] Financial Outlook - The company has 75% contract coverage for 2024 at an average dayrate of $129k/day[29] - The company has 53% contract coverage for 2025 at an average dayrate of $130k/day[29] - The company has 18% contract coverage for 2026-2028 at an average dayrate of $125k/day[29]

Group 1 - Borr Drilling Limited is an offshore drilling services company specializing in shallow water oil and gas exploration with a modern fleet of jack-up rigs [1] - The company operates globally, with a particular focus on the Latin American market [1] Group 2 - The article expresses a positive outlook on Borr Drilling Limited, highlighting its potential for growth and investment opportunities [2]

Financial Performance - Q1 2025 Adjusted EBITDA reached $96.1 million, with an Adjusted EBITDA margin of 44.4%[8] - Total operating revenues for Q1 2025 were $216.6 million, a decrease of $46.5 million or 18% compared to $263.1 million in Q4 2024[13] - Net loss for Q1 2025 was $16.9 million, compared to a net income of $26.3 million in Q4 2024, representing a 164% change[13] Fleet and Contract Coverage - The company has 24 modern rigs in its fleet, with 22 rigs currently active[8] - Contract coverage for 2025 is at 79% with an average day rate of $147,000[8] - The company anticipates increasing contract coverage to 80-85% for the full year 2025[25] Liquidity and Debt - The company's liquidity stands at $320 million, including an undrawn revolving credit facility (RCF) of $150 million[8, 9] - Debt amortization is $135 million per annum[8] Market and Outlook - The company is on track to deliver a 2025 consensus Adjusted EBITDA of $460 million[25] - The company added $221 million in backlog revenue with 9 new commitments[16] - Average day rate for year-to-date 2025 contracting stats is $141,000[16]

Financial Data and Key Metrics Changes - Total operating revenue decreased by $46.5 million quarter over quarter, resulting in adjusted EBITDA of $96.1 million for the period [5][10] - The net loss for the first quarter was $16.9 million, a decrease of $43.2 million compared to the net income in the fourth quarter [12] - Free cash position at the end of Q1 was $170 million, with total available liquidity of $320 million [12][13] Business Line Data and Key Metrics Changes - Average active rigs decreased to 16 out of a 24 rig fleet during the quarter, but operational performance remained strong with technical utilization at 99.2% and economic utilization at 97.9% [5][10] - Day rate revenues decreased by $22.6 million, primarily due to a decrease in the number of operating days for certain rigs, partially offset by an increase in operating days for others [10][11] - Bareboat charter revenue decreased by $17.9 million due to the temporary suspension of certain rigs [11] Market Data and Key Metrics Changes - The operating rig count increased to 22 in May, laying the foundation for stronger financial performance in upcoming quarters [6][18] - The 2025 fleet coverage now stands at 79% at an average day rate of $147,000, with expectations to rise to 80% to 85% in the coming months [19][25] - Jackup utilization remains steady at 92%, with modern rig market utilization just under 90% [20][21] Company Strategy and Development Direction - The company is focusing on increasing activity in 2026, with commercial efforts now increasingly directed towards that year [8][9] - The Board decided to suspend the dividend to reinforce the balance sheet and enhance long-term value creation [9][27] - The company aims to maximize the 2025 backlog while building coverage for 2026, indicating a resilient business model despite short-term uncertainties [24][27] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is uncertainty in the market, the long-term fundamentals for the jackup market remain strong [24] - The company is actively monitoring macroeconomic developments and customer sentiments regarding drilling programs [37][38] - There is optimism regarding contract extension opportunities in Mexico, with expectations for Pemex to return to regular payment schedules [33][55] Other Important Information - The company received several industry awards for outstanding safety performance during the quarter [5][6] - Recent fixtures indicate that Aramco may be preparing to secure additional long-term jackup capacity [22][23] Q&A Session Summary Question: Resumption of operations for suspended rigs in Mexico - Management indicated that the resumption is due to a combination of Pemex's realization of the need for increased activity and the quality of the company's rigs [31][32] Question: Uncertain market conditions and dividend suspension - Management explained that the decision to suspend dividends is a precautionary measure due to macroeconomic uncertainties and customer caution [35][38] Question: Visibility on contract extensions and rig options - Management expressed optimism about contract extension opportunities in Mexico, with discussions ongoing with Pemex [33][34] Question: Liquidity situation and potential use of RCF - Management stated that the liquidity position is solid, with no immediate plans to draw on the RCF unless payment delays occur [55][56] Question: Backlog and termination clauses - Management confirmed that most contracts include termination for convenience clauses with payout levels that protect the backlog [80][82] Question: CapEx guidance - Management indicated expected maintenance CapEx of around $50 million for 2025, equating to approximately $2 million per rig [84]

[Management Discussion and Analysis of Financial Condition and Results of Operation](index=7&type=section&id=Management%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) This section provides an overview of Borr Drilling's business, recent operational and financial performance, liquidity, and capital resources for the first quarter of 2025 [Overview](index=7&type=section&id=Overview) Borr Drilling is an offshore shallow-water drilling contractor that owns, contracts, and operates a fleet of jack-up rigs for the oil and gas industry, with 24 premium jack-up rigs as of March 31, 2025 - The company's **primary business** is the ownership, contracting, and operation of jack-up rigs for shallow-water operations (up to 400 feet)[18](index=18&type=chunk) - As of March 31, 2025, Borr Drilling's fleet comprised **24 premium jack-up rigs**[18](index=18&type=chunk) [Recent Developments](index=7&type=section&id=Recent%20Developments) In the first quarter of 2025, the company executed several key operational and corporate actions, including commencing a new contract for the 'Vali' rig, receiving notice to re-mobilize three previously suspended rigs in Mexico, and cancelling a significant number of treasury shares - In March 2025, the company cancelled **19,680,391 treasury shares** related to a share lending agreement[19](index=19&type=chunk) - The **'Vali' rig** commenced its first contract in March 2025 after being delivered in August 2024[20](index=20&type=chunk) - In April 2025, the company received notice to re-mobilize the rigs **'Galar', 'Grid', and 'Gersemi'**, which had been on temporary suspension in Mexico[20](index=20&type=chunk) [Operating and Financial Review](index=7&type=section&id=Operating%20and%20Financial%20Review) For the first quarter of 2025, Borr Drilling reported a net loss of $16.9 million, a significant downturn from a net income of $14.4 million in the same period of 2024, driven by a 7% decrease in total operating revenues and a 5% increase in total operating expenses, with Adjusted EBITDA also decreasing by 18% to $96.1 million Selected Financial Information (Q1 2025 vs Q1 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Total operating revenues** | 216.6 | 234.0 | (17.4) | (7)% | | **Operating income** | 60.2 | 85.0 | (24.8) | (29)% | | **(Loss) / income from equity method investments** | (1.8) | 5.4 | (7.2) | (133)% | | **Total financial expenses, net** | (62.7) | (57.8) | (4.9) | 8% | | **Net (loss) / income** | (16.9) | 14.4 | (31.3) | (217)% | - Total operating revenues decreased by **$17.4 million**, mainly due to a **$24.4 million** drop in related party revenue and a **$3.7 million** decrease in bareboat charter revenue, as three rigs were on temporary suspension, partially offset by a **$6.8 million** increase in management contract revenue and a **$3.9 million** rise in dayrate revenue[24](index=24&type=chunk)[25](index=25&type=chunk)[26](index=26&type=chunk) - Rig operating and maintenance expenses rose by **$5.8 million**, partly because expenses for certain rigs previously recognized in equity method investments are now recognized directly by the company following contract restructuring and suspensions[28](index=28&type=chunk) Adjusted EBITDA Reconciliation (Q1 2025 vs Q1 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Net (loss) / income** | (16.9) | 14.4 | (31.3) | (217)% | | Depreciation of non-current assets | 35.9 | 31.8 | 4.1 | 13% | | Loss / (Income) from equity method investments | 1.8 | (5.4) | 7.2 | (133)% | | Total financial expenses, net | 62.7 | 57.8 | 4.9 | 8% | | Income tax expense | 12.6 | 18.2 | (5.6) | (31)% | | **Adjusted EBITDA** | **96.1** | **116.8** | **(20.7)** | **(18)%** | [Liquidity and Capital Resources](index=10&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company held $170.0 million in cash and cash equivalents, with total principal debt at $2,179.6 million, while net cash from operating activities substantially increased to $138.7 million primarily due to working capital movements including large cash settlements from Mexico operations, and the company continued its cash distributions to shareholders - As of March 31, 2025, the company had **$170.0 million** in cash and cash equivalents and total principal debt outstanding of **$2,179.6 million**[36](index=36&type=chunk)[38](index=38&type=chunk) Cash Flow Summary (Q1 2025 vs Q1 2024) | In $ millions | 2025 | 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | 138.7 | 23.9 | 114.8 | 480% | | Net cash used in investing activities | (25.1) | (18.7) | (6.4) | 34% | | Net cash (used in) / provided by financing activities | (4.9) | 175.2 | (180.1) | (103)% | | Net increase in cash and cash equivalents | 108.7 | 180.4 | (71.7) | (40)% | - The significant increase in net cash from operating activities was primarily due to working capital movements, including approximately **$117 million** in cash settlements from Mexico operations[42](index=42&type=chunk) Recent Cash Distributions | Date of Cash Distribution Declaration | Date of Payment to Shareholder | Cash Distribution per Share ($) | | :--- | :--- | :--- | | February 19, 2025 | March 19, 2025 | $0.02 | [Non-GAAP Financial Measures](index=12&type=section&id=Non-GAAP%20Financial%20Measures) The company utilizes Adjusted EBITDA, a non-GAAP financial measure, to enhance comparability of its underlying business performance, defined as net income adjusted for depreciation, income/loss from equity method investments, net financial expenses, and income tax expense Definition of Adjusted EBITDA | Non-GAAP Measure | Closest Equivalent to GAAP Measure | Definition | | :--- | :--- | :--- | | Adjusted EBITDA | Net (loss) / income | Net (loss) / income adjusted for: depreciation of non-current assets; (loss) / income from equity method investments; total financial expenses, net; and income tax expense. | - Management believes **Adjusted EBITDA** improves period-to-period comparability and is representative of underlying performance, though it has limitations such as not reflecting cash requirements for capital expenditures, debt service, or taxes[45](index=45&type=chunk)[47](index=47&type=chunk) [Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents the company's unaudited financial statements, including statements of operations, balance sheets, cash flows, and detailed notes for the first quarter of 2025 [Unaudited Condensed Consolidated Statements of Operations](index=14&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, the company reported total operating revenues of $216.6 million and a net loss of $16.9 million, a significant shift from the same period in 2024, which saw revenues of $234.0 million and a net income of $14.4 million, resulting in a basic and diluted loss per share of $0.07 for Q1 2025 Condensed Consolidated Statements of Operations (Q1 2025 vs Q1 2024) | In $ millions | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | **Total operating revenues** | **216.6** | **234.0** | | Operating income | 60.2 | 85.0 | | Total financial expenses, net | (62.7) | (57.8) | | (Loss) / income before income taxes | (4.3) | 32.6 | | Income tax expense | (12.6) | (18.2) | | **Net (loss) / income** | **(16.9)** | **14.4** | | **Basic (loss) / income per share** | **(0.07)** | **0.06** | | **Diluted (loss) / income per share** | **(0.07)** | **0.06** | [Unaudited Condensed Consolidated Balance Sheets](index=15&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Borr Drilling's balance sheet showed total assets of $3,402.2 million and total liabilities of $2,427.3 million, resulting in total equity of $974.9 million, with cash and cash equivalents increasing significantly to $170.0 million from $61.6 million at year-end 2024, while total debt remained relatively stable Condensed Consolidated Balance Sheet Highlights | In $ millions | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | 170.0 | 61.6 | | Total current assets | 516.9 | 516.6 | | Jack-up drilling rigs, net | 2,806.5 | 2,823.2 | | **Total assets** | **3,402.2** | **3,419.6** | | **LIABILITIES AND EQUITY** | | | | Total current liabilities | 412.4 | 409.6 | | Long-term debt | 1,996.6 | 1,992.5 | | **Total liabilities** | **2,427.3** | **2,426.3** | | **Total equity** | **974.9** | **993.3** | | **Total liabilities and equity** | **3,402.2** | **3,419.6** | [Unaudited Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In Q1 2025, the company generated a robust $138.7 million in cash from operating activities, a sharp increase from $23.9 million in Q1 2024, with cash used in investing activities at $25.1 million and cash used in financing activities at $4.9 million, resulting in a net increase in cash and cash equivalents of $108.7 million, bringing the total to $171.2 million at the end of the period Condensed Consolidated Statements of Cash Flows (Q1 2025 vs Q1 2024) | In $ millions | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **138.7** | **23.9** | | Net cash used in investing activities | (25.1) | (18.7) | | Net cash (used in) / provided by financing activities | (4.9) | 175.2 | | **Net increase in cash, cash equivalents and restricted cash** | **108.7** | **180.4** | | Cash, cash equivalents and restricted cash at the end of the period | 171.2 | 283.0 | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=19&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the accounting policies and financial figures presented, including the company operating as a single segment, a geographic revenue breakdown, specifics on debt instruments and maturities, related party transactions with the Mexico JV, and changes to share capital, including a significant cancellation of treasury shares - **Note 4:** The company operates as a **single reportable segment**, with major customers in Q1 2025 including **ENI S.p.A (23% of operating revenues)** and **PTT Exploration and Production (14%)**[69](index=69&type=chunk)[71](index=71&type=chunk) - **Note 6:** The company's Mexico operations were restructured, with bareboat charters with the Perfomex JV terminated and replaced with new agreements with an external party effective January and April 2024, and three rigs under these new agreements temporarily suspended in January 2025, with notice to re-mobilize received in April 2025[82](index=82&type=chunk)[85](index=85&type=chunk) - **Note 9:** Bermuda enacted a **15% Corporate Income Tax** effective January 1, 2025, with the company expecting to be in scope in 2026 but not anticipating a material short-term impact[90](index=90&type=chunk)[95](index=95&type=chunk) - **Note 17:** Total principal debt outstanding as of March 31, 2025, was **$2,179.6 million**, and the company was in compliance with all debt covenants[115](index=115&type=chunk)[119](index=119&type=chunk) - **Note 21:** In Q1 2025, the company cancelled **19,680,391 treasury shares** following its delisting from the Oslo Stock Exchange and subsequent amendments to its Share Lending Agreement[131](index=131&type=chunk)[133](index=133&type=chunk)