Valaris Limited (VAL) came out with quarterly earnings of $2.03 per share, beating the Zacks Consensus Estimate of $0.96 per share. This compares to loss of $0.29 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 111.46%. A quarter ago, it was expected that this company would post earnings of $0.40 per share when it actually produced earnings of $0.35, delivering a surprise of -12.50%. Over the last four quarters, the company h ...

Valaris Ltd. (VAL) , an offshore drilling contractor, has mobilized its 123 jack-up rig toward the Selene well in the Southern North Sea. The Valaris 123 jack-up rig is slated to drill the Selene exploration well in the license P2437, operated by the British energy major, Shell. Shell's partner, Deltic Energy, stated that the jack-up rig was mobilized on Jul 21, and is expected to reach its destination shortly. The duration of the journey will be determined by the weather conditions during its transit. The ...

Valaris - Actual Results vs. Guidance Valaris Limited (NYSE: VAL) has been covered by me previously, so investors should view this as an update to my earlier articles on the company. Last month, leading offshore driller Valaris reported Q1/2024 results handily above expectations, mostly due to improved revenue efficiency. Revenues also benefited from the drillship VALARIS-DS 8 commencing its contract with Petrobras (PBR) offshore Brazil during the quarter. Adjusted EBITDA of $54 million was also well above ...

Financial Data and Key Metrics Changes - In Q1 2024, revenue was $525 million, an increase from $484 million in the prior quarter, while adjusted EBITDA was $54 million, down from $58 million in the previous quarter [66] - Adjusted EBITDAR, which adds back reactivation expenses, was $84 million, down from $96 million in the prior quarter [66] - Cash and cash equivalents at the end of the quarter were $509 million, a decline of $127 million primarily due to capital expenditures of $151 million [41] Business Line Data and Key Metrics Changes - The jackup revenues decreased due to fewer operating days for several rigs, including Valaris 107, 123, and 247 [40] - The floater market saw an increase in average day rates, moving from approximately $450,000 in the second half of 2023 to approximately $480,000 in the first four months of 2024 [33][66] - The contracted benign environment floater count increased to 127 rigs during Q1, the highest point since late 2016, marking an increase of 26 contracted rigs since early 2021 [32] Market Data and Key Metrics Changes - The global jackup market remains tight with marketed utilization nearing 95% and the contracted rig count at its highest level in nearly a decade [26] - In Brazil, Petrobras has 31 contracted floaters, with ongoing tenders that may result in additional rigs needed to meet market demand [34] - The North Sea market has shown improvement, with strong customer interest for programs commencing in the second half of 2025 [36] Company Strategy and Development Direction - The company aims to secure new contracts at higher day rates and consistently build its backlog, which now totals more than $4 billion, marking a 43% increase over the past 12 months [57] - The focus remains on maximizing fleet profitability by keeping active rigs highly utilized and securing the best contract economics possible [23] - The company intends to return all future free cash flow to shareholders unless a better use is identified [20][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong customer demand for work expected to commence in 2025 and 2026, which will support anticipated earnings and cash flow growth [75] - The offshore drilling market is expected to see strong growth through 2026, driven by increased upstream CapEx and offshore FIDs [16] - Management noted that while there may be some near-term rate pressure due to suspended contracts in Saudi Arabia, the overall demand remains strong [84] Other Important Information - The company has reactivated five drillships over the past two years and is focused on delivering successful startups for upcoming contracts [10] - The company expects total capital expenditures for 2024 to be in the range of $420 million to $460 million, reflecting an increase due to contract preparation costs [46] Q&A Session Summary Question: Can you provide more details on the VALARIS 144 jackup contract? - The contract was signed in March 2024, and the mobilization cost is assumed to be less than $10 million [98] Question: What is the outlook for the jackup market given the suspended rigs in Saudi Arabia? - Management believes there is sufficient demand to absorb the suspended rigs without significant long-term pressure on rates [84][108] Question: What is the likelihood of securing contracts for the DS-11, DS-13, and DS-14 rigs? - Management is actively discussing opportunities for these high-specification assets and is focused on finding the right jobs that provide meaningful returns [123][142]

Include significant upfront payments from customers VALARIS Significant earnings potential and cash flow from Valaris fleet | --- | --- | --- | --- | --- | --- | |-------|----------------------|-------------------------------------------|----------|----------|----------| | | with Future Contract | Illustrative Scenario | A | B | C | | 13 | 10 | Drillship Day Rates | $400K | $450K | $500K | | 5 | 3 | Benign Semisubmersible Day Rates | $300K | $350K | $400K | | 12 | 9 | HD Harsh Environment Jackup Day Rates 2 ...

PART I FINANCIAL INFORMATION [Item 1. Financial Statements](index=7&type=section&id=Item%201.%20FINANCIAL%20STATEMENTS) Valaris reported Q1 2024 operating revenues of $525.0 million and net income of $25.5 million, with total assets of $4.35 billion and liabilities of $2.32 billion Condensed Consolidated Statements of Operations (Q1 2024 vs Q1 2023) | Metric | Three Months Ended March 31, 2024 ($M) | Three Months Ended March 31, 2023 ($M) | | :--- | :--- | :--- | | **Operating Revenues** | 525.0 | 430.1 | | **Operating Income** | 29.3 | 8.5 | | **Net Income** | 25.5 | 48.6 | | **Net Income Attributable to Valaris** | 25.5 | 46.7 | | **Diluted EPS** | $0.35 | $0.61 | Condensed Consolidated Balance Sheets | Metric | March 31, 2024 ($M) | December 31, 2023 ($M) | | :--- | :--- | :--- | | Cash and cash equivalents | 494.1 | 620.5 | | Total Assets | 4,354.4 | 4,322.2 | | Long-Term Debt | 1,080.1 | 1,079.3 | | Total Liabilities | 2,324.1 | 2,325.2 | | Total Valaris shareholders' equity | 2,020.9 | 1,987.6 | Condensed Consolidated Statements of Cash Flows | Metric | Three Months Ended March 31, 2024 ($M) | Three Months Ended March 31, 2023 ($M) | | :--- | :--- | :--- | | Net cash provided by operating activities | 26.3 | 151.7 | | Net cash used in investing activities | (151.3) | (56.2) | | Net cash used in financing activities | (1.6) | — | | **Decrease in Cash & Restricted Cash** | **(126.6)** | **95.5** | [Note 2 - Revenue from Contracts with Customers](index=13&type=section&id=Note%202%20-%20Revenue%20from%20Contracts%20with%20Customers) Revenue is recognized over time for drilling services, with contract liabilities of $158.5 million and deferred costs of $85.3 million as of March 31, 2024 Contract Assets and Liabilities (as of March 31, 2024) | Item | Amount ($ millions) | | :--- | :--- | | Current contract assets | 2.3 | | Noncurrent contract assets | 5.8 | | Current contract liabilities (deferred revenue) | 122.3 | | Noncurrent contract liabilities (deferred revenue) | 36.2 | [Note 3 - Equity Method Investment in ARO](index=15&type=section&id=Note%203%20-%20Equity%20Method%20Investment%20in%20ARO) Valaris holds a 50% interest in ARO, recognizing $2.4 million in equity earnings for Q1 2024, and holds $289.3 million in notes receivable ARO Summarized Financial Information (Q1 2024 vs Q1 2023) | Metric | Three Months Ended March 31, 2024 ($M) | Three Months Ended March 31, 2023 ($M) | | :--- | :--- | :--- | | Revenues | 138.3 | 123.6 | | Operating income | 15.2 | 13.1 | | Net income (loss) | (1.6) | 0.8 | - Valaris's share of ARO's Q1 2024 net loss was **$0.8 million**, but after a **$3.2 million** positive adjustment for amortization of basis differences, the company recognized **$2.4 million** in earnings from ARO[51](index=51&type=chunk) - The carrying value of Notes Receivable from ARO was **$289.3 million** as of March 31, 2024, against a principal amount of **$402.7 million**. Valaris recognized **$14.0 million** in total interest income from these notes in Q1 2024[56](index=56&type=chunk)[58](index=58&type=chunk) [Note 8 - Debt](index=20&type=section&id=Note%208%20-%20Debt) Long-term debt primarily consists of $1.1 billion in 8.375% Senior Secured Second Lien Notes due 2030, with an undrawn $375.0 million revolving credit facility - The company has **$1.1 billion** in Second Lien Notes due 2030 and an undrawn **$375.0 million** revolving credit facility[66](index=66&type=chunk)[69](index=69&type=chunk) [Note 9 - Shareholders' Equity](index=21&type=section&id=Note%209%20-%20Shareholders'%20Equity) The board authorized a $600.0 million share repurchase program, with $400.0 million remaining available as of March 31, 2024, and no Q1 2024 repurchases - The share repurchase program was increased to **$600.0 million** in February 2024, with **$400.0 million** available for repurchases as of March 31, 2024. No repurchases were made in Q1 2024[74](index=74&type=chunk) [Note 10 - Income Taxes](index=22&type=section&id=Note%2010%20-%20Income%20Taxes) A favorable Luxembourg tax decision in April 2024 will result in a $63.0 million tax benefit reversal in Q2 2024 - In April 2024, Valaris received a favorable decision from Luxembourg tax authorities, which will lead to the reversal of a previously recorded liability and recognition of a tax benefit of approximately **$63.0 million** in Q2 2024[77](index=77&type=chunk) [Note 11 - Contingencies](index=23&type=section&id=Note%2011%20-%20Contingencies) Valaris has a potential $1.25 billion funding obligation to ARO for its newbuild program and faces ongoing patent litigation and Brazilian administrative proceedings - Valaris may be required to make capital contributions to ARO, up to a maximum of **$1.25 billion**, to fund ARO's 20-rig newbuild program if other financing is unavailable[80](index=80&type=chunk) [Note 12 - Segment Information](index=24&type=section&id=Note%2012%20-%20Segment%20Information) Floaters segment led Q1 2024 profitability with $57.8 million operating income on $324.4 million revenue, followed by Jackups and ARO Segment Performance - Three Months Ended March 31, 2024 | Segment | Revenues ($M) | Operating Income ($M) | | :--- | :--- | :--- | | Floaters | 324.4 | 57.8 | | Jackups | 152.3 | 8.0 | | ARO | 138.3 | 15.2 | | Other | 48.3 | 24.8 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management projects a positive offshore drilling market, with a $4.0 billion contract backlog and strong liquidity, planning $420-460 million in 2024 capital expenditures - The offshore drilling market outlook is positive, with increasing global utilization and day rates for rigs. Floater utilization for 6th and 7th generation drillships is at **90%**[101](index=101&type=chunk)[108](index=108&type=chunk) Contract Backlog Summary | Segment | April 30, 2024 ($M) | February 15, 2024 ($M) | | :--- | :--- | :--- | | Floaters | 2,404.6 | 2,531.7 | | Jackups | 1,184.9 | 1,167.4 | | Other | 427.7 | 222.3 | | **Total Valaris** | **4,017.2** | **3,921.4** | | ARO (100%) | 1,982.2 | 2,138.1 | - The company expects capital expenditures for 2024 to be between **$420.0 million** and **$460.0 million**, primarily for maintenance, upgrades, and rig reactivations[162](index=162&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Q1 2024 revenues increased 9% sequentially to $525.0 million and 22% year-over-year, driven by the Floaters segment, despite a sequential operating income decrease Q1 2024 vs Q4 2023 Performance | Metric | Q1 2024 ($M) | Q4 2023 ($M) | Change (%) | | :--- | :--- | :--- | :--- | | Revenues | 525.0 | 483.8 | 9% | | Operating Income | 29.3 | 38.3 | (23)% | | Net Income | 25.5 | 828.5 | (97)% | Q1 2024 vs Q1 2023 Performance | Metric | Q1 2024 ($M) | Q1 2023 ($M) | Change (%) | | :--- | :--- | :--- | :--- | | Revenues | 525.0 | 430.1 | 22% | | Operating Income | 29.3 | 8.5 | 245% | | Net Income | 25.5 | 48.6 | (48)% | [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $494.1 million cash and an undrawn $375.0 million credit facility, with no debt principal due until 2030 - As of March 31, 2024, cash and cash equivalents were **$494.1 million**, with an additional **$375.0 million** available under the undrawn Credit Agreement[154](index=154&type=chunk) - Net cash provided by operating activities was **$26.3 million** in Q1 2024, while capital expenditures totaled **$151.3 million**[157](index=157&type=chunk) - The Notes Receivable from ARO, totaling **$402.7 million** in principal, are scheduled to mature in 2027 and 2028[165](index=165&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section refers to Item 2 for disclosures on interest rate and foreign currency market risks - The report directs readers to the Market Risk section within Item 2 (MD&A) for disclosures on interest rate and foreign currency risk[184](index=184&type=chunk) [Item 4. Controls and Procedures](index=45&type=section&id=Item%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded disclosure controls were effective as of March 31, 2024, with no material changes to internal control over financial reporting - Management concluded that disclosure controls and procedures were effective as of the end of the quarter[185](index=185&type=chunk) - No material changes to internal control over financial reporting occurred during the first quarter of 2024[186](index=186&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=46&type=section&id=Item%201.%20LEGAL%20PROCEEDINGS) Valaris faces pending environmental assessments in Brazil with a $0.4 million liability, while other legal matters are not expected to be material - Valaris is contesting notices of assessment for environmental matters in Brazil and has recorded a **$0.4 million** liability related to these matters as of March 31, 2024[189](index=189&type=chunk) [Item 1A. Risk Factors](index=46&type=section&id=Item%201A.%20RISK%20FACTORS) No material changes to risk factors were reported from the prior Annual Report on Form 10-K, to which readers are referred for comprehensive details - The report refers readers to the risk factors section of the Annual Report on Form 10-K for the year ended December 31, 2023, for a full description of significant risks[191](index=191&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) Approximately $400.0 million remains available under the $600.0 million share repurchase program, with no repurchases made in Q1 2024 - Approximately **$400.0 million** remained available for share repurchases under the company's **$600.0 million** program as of March 31, 2024. No repurchases were made in Q1 2024[192](index=192&type=chunk) [Item 5. Other Information](index=46&type=section&id=Item%205.%20OTHER%20INFORMATION) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the first quarter of 2024 - No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during Q1 2024[193](index=193&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20EXHIBITS) Filed exhibits include management certifications, a new PSU award agreement form, and Inline XBRL documents - Filed exhibits include management certifications (302 and 906), a new PSU award agreement form, and Inline XBRL documents[197](index=197&type=chunk)

www.valaris.com Press Release Valaris Reports First Quarter 2024 Results Hamilton, Bermuda, May 1, 2024… Valaris Limited (NYSE: VAL) ("Valaris" or the "Company") today reported first quarter 2024 results. President and Chief Executive Officer Anton Dibowitz said, "I am very pleased with our start to 2024 as we delivered strong safety and operational performance during the first quarter as evidenced by fleetwide revenue efficiency of 97%. Our financial results also benefited from more operating days for our ...

Valaris Limited (NYSE:VAL) Q4 2023 Results Conference Call February 22, 2024 10:00 AM ET Company Participants Darin Gibbins - Vice President, Investor Relations & Treasurer Anton Dibowitz - President and CEO Matt Lyne - Senior Vice President, COO Chris Weber - Chief Financial Officer Conference Call Participants David Smith - Pickering Energy Advisors Eddie Kim - Barclays Fredrik Stene - Clarksons Platou Securities Greg Lewis - BTIG Kurt Hallead - Benchmark Operator Good day, and welcome to the Valaris Four ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-8097 Valaris Limited (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organizati ...

Financial Performance - Net income for Q4 2023 increased to $829 million from $17 million in Q3 2023, including a tax benefit of $790 million[6] - Adjusted EBITDA rose to $58 million from $40 million in Q3 2023, driven by more operating days and lower reactivation expenses[6] - Revenues for Q4 2023 increased to $484 million from $455 million in Q3 2023, with operating days contributing to the growth[7] - Net income for Q4 2023 was $828.5 million, compared to a net income of $17.0 million in Q3 2023, reflecting a significant increase[24] - Net income for the year ended December 31, 2023, increased to $866.8 million, up from $181.8 million in 2022, representing a growth of 376%[28] - Net cash provided by operating activities for the year was $267.5 million, compared to $127.0 million in 2022, reflecting a 110% increase[28] - Operating income for the same period was $19.9 million, significantly higher than $8.1 million in the prior quarter[72] - EBITDA for Q4 2023 was reported at $39.4 million, up from $23.9 million in Q3 2023[72] Revenue and Contract Backlog - Revenue efficiency was reported at 93% for the quarter and 96% for the year[6] - The company secured new contracts and extensions, resulting in a contract backlog exceeding $1.4 billion during Q4 2023[4] - Total contract backlog increased to over $3.9 billion as of February 15, 2024, representing a nearly 60% increase year-over-year[6] - The contract backlog reached $3,921.4 million as of February 15, 2024, up from $3,158.1 million on November 1, 2023, indicating a 24.1% increase[45] - Total contract backlog as of February 15, 2024, was $2,138.1 million, a decrease from $2,290.7 million in the previous quarter[74] Cash Flow and Expenditures - Capital expenditures surged to $463 million from $106 million in Q3 2023, primarily due to newbuild drillships delivery[11] - Cash and cash equivalents decreased to $620.5 million as of December 31, 2023, from $1,041.1 million as of September 30, 2023[26] - Net cash used in investing activities for the year was $(665.8) million, compared to $(16.7) million in 2022, indicating a substantial increase in cash outflow[28] - The company reported a net cash provided by financing activities of $285.5 million for the year, compared to $(6.4) million in 2022, showing a significant turnaround[28] Shareholder Returns - Share repurchases totaled $50 million in Q4 2023 and $200 million for the year, with an increase in the share repurchase program authorized to $600 million[6] - Payments for share repurchases in the three months ended December 31, 2023, totaled $51.2 million, compared to $83.0 million in the previous quarter, a decrease of 38%[30] Operational Efficiency - The company anticipates continued growth in offshore drilling activity and is focused on enhancing operational efficiency and sustainability initiatives[21] - The total revenue for the company was $93.2 million in Q4 2023, compared to $72.4 million in Q3 2023, reflecting a 28.5% increase[36] - General and administrative expenses were $24.3 million in Q4 2023, slightly up from $24.2 million in Q3 2023[39] - Reactivation costs amounted to $38.5 million in Q4 2023, down from $50.9 million in Q3 2023, showing a decrease of 24.7%[41] Fleet Performance - Total fleet utilization improved to 60% in Q4 2023, compared to 57% in Q3 2023, marking a 5.3% increase[51] - Active fleet utilization reached 79% in Q4 2023, up from 75% in Q3 2023, indicating a 5.3% improvement[53] - Average daily revenue for drillships increased to $307,000 in Q4 2023, up from $288,000 in Q3 2023, representing a 6.6% increase[48] - Average daily revenue for owned rigs increased to $100,000 in Q4 2023, up from $91,000 in Q3 2023[75] - The average daily revenue for jackups was $111,000 in Q4 2023, a slight decrease from $116,000 in Q3 2023[48] Segment Performance - ARO Drilling's revenues increased to $134 million from $122 million in Q3 2023, attributed to the newbuild jackup Kingdom 1 commencing its maiden contract[16] - Adjusted EBITDA for Valaris in Q4 2023 was $57.5 million, up from $40.0 million in Q3 2023, reflecting a growth of 43.75%[86] - JACKUPS segment net income rose to $46.1 million in Q4 2023 from $34.4 million in Q3 2023[88] - Adjusted EBITDA for the FLOATERS segment was $37.2 million in Q4 2023, an increase from $28.2 million in Q3 2023[88] - Adjusted EBITDA for HD & SD Modern Jackups rose to $30.1 million in Q4 2023, compared to $13.0 million in Q4 2022, marking an increase of 131.5% year-over-year[94]