Condensed Consolidating Financial Information | Note 15— Condensed Consolidating Financial Information Guarantees of Registered Securities Noble-Cayman, or one or more 100 percent owned subsidiaries of Noble-Cayman, is an issuer, or full and unconditional guarantor or otherwise obligated as of June 30, 2019 with respect to registered securities as follows (see “ Note 6— Debt ” for additional information): Notes (1) Issuer Guarantor 4.90% Senior Notes due 2020 NHIL Noble-Cayman 4.625% Senior Notes due 2021 NHIL Noble-Cayman 3.95% Senior Notes due 2022 NHIL Noble-Cayman 7.75% Senior Notes due 2024 NHIL Noble-Cayman 7.95% Senior Notes due 2025 NHIL Noble-Cayman 6.20% Senior Notes due 2040 NHIL Noble-Cayman 6.05% Senior Notes due 2041 NHIL Noble-Cayman 5.25% Senior Notes due 2042 NHIL Noble-Cayman 8.95% Senior Notes due 2045 NHIL Noble-Cayman (1) Our 2026 Notes are excluded from this list as they are unregistered securities issued in a non-public offering. The following condensed consolidating financial statements of Noble-Cayman, NHIL and all other subsidiaries present investments in both consolidated and unconsolidated affiliates using the equity method of accounting. NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET June 30, 2019 (in thousands) (Unaudited) Noble - NHIL Other Consolidating Total ASSETS Current assets Cash and cash equivalents $ — $ — $ 153,703 $ — $ 153,703 Accounts receivable — — 222,889 — 222,889 Taxes receivable — — 25,682 — 25,682 Accounts receivable from affiliates 653,968 61,045 5,262,705 (5,977,718 ) — Prepaid expenses and other current assets 327 — 59,332 — 59,659 Total current assets 654,295 61,045 5,724,311 (5,977,718 ) 461,933 Property and equipment, at cost — — 11,080,690 — 11,080,690 Accumulated depreciation — — (2,621,100 ) — (2,621,100 ) Property and equipment, net — — 8,459,590 — 8,459,590 Notes receivable from affiliates 5,145 — 28,000 (33,145 ) — Investments in affiliates 7,798,404 8,786,983 — (16,585,387 ) — Other assets — — 139,035 — 139,035 Total assets $ 8,457,844 $ 8,848,028 $ 14,350,936 $ (22,596,250 ) $ 9,060,558 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt $ 300,000 $ — $ — $ — $ 300,000 Accounts payable 16 — 117,796 — 117,812 Accrued payroll and related costs — — 40,733 — 40,733 Accounts payable to affiliates 4,000,510 1,262,194 715,014 (5,977,718 ) — Taxes payable — 113 25,400 — 25,513 Interest payable 684 85,057 3,412 89,153 Other current liabilities — — 61,361 — 61,361 Total current liabilities 4,301,210 1,347,364 963,716 (5,977,718 ) 634,572 Long-term debt — 3,387,002 166,086 — 3,553,088 Notes payable to affiliates — 28,000 5,145 (33,145 ) — Deferred income taxes — — 70,872 — 70,872 Other liabilities 19,929 — 254,292 — 274,221 Total liabilities 4,321,139 4,762,366 1,460,111 (6,010,863 ) 4,532,753 Commitments and contingencies Shareholders’ equity 4,136,705 4,085,662 12,499,725 (16,585,387 ) 4,136,705 Noncontrolling interests — — 391,100 — 391,100 Total equity 4,136,705 4,085,662 12,890,825 (16,585,387 ) 4,527,805 Total liabilities and equity $ 8,457,844 $ 8,848,028 $ 14,350,936 $ (22,596,250 ) $ 9,060,558 NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2018 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total ASSETS Current assets Cash and cash equivalents $ — $ 17,818 $ 356,557 $ — $ 374,375 Accounts receivable — — 200,722 — 200,722 Taxes receivable — — 20,498 — 20,498 Short-term notes receivable from affiliates — — 3,175,662 (3,175,662 ) — Accounts receivable from affiliates 275,726 61,046 4,823,902 (5,160,674 ) — Prepaid expenses and other current assets — — 61,917 — 61,917 Total current assets 275,726 78,864 8,639,258 (8,336,336 ) 657,512 Property and equipment, at cost — — 10,956,412 — 10,956,412 Accumulated depreciation — — (2,475,694 ) — (2,475,694 ) Property and equipment, net — — 8,480,718 — 8,480,718 Notes receivable from affiliates 5,145 — — (5,145 ) — Investments in affiliates 7,716,068 12,300,840 — (20,016,908 ) — Other assets 609 — 124,540 — 125,149 Total assets $ 7,997,548 $ 12,379,704 $ 17,244,516 $ (28,358,389 ) $ 9,263,379 LIABILITIES AND EQUITY Current liabilities Short-term notes payables to affiliates $ — $ 3,175,662 $ — $ (3,175,662 ) $ — Accounts payable 45 — 125,192 — 125,237 Accrued payroll and related costs — — 50,284 — 50,284 Accounts payable to affiliates 3,725,506 1,098,395 336,773 (5,160,674 ) — Taxes payable — — 29,386 — 29,386 Interest payable 3 99,997 100 — 100,100 Other current liabilities — — 60,012 — 60,012 Total current liabilities 3,725,554 4,374,054 601,747 (8,336,336 ) 365,019 Long-term debt — 3,817,153 60,249 — 3,877,402 Notes payable to affiliates — — 5,145 (5,145 ) — Deferred income taxes — — 91,695 — 91,695 Other liabilities 19,929 — 255,866 — 275,795 Total liabilities 3,745,483 8,191,207 1,014,702 (8,341,481 ) 4,609,911 Commitments and contingencies Shareholders’ equity 4,252,065 4,188,497 15,828,411 (20,016,908 ) 4,252,065 Noncontrolling interests — — 401,403 — 401,403 Total equity 4,252,065 4,188,497 16,229,814 (20,016,908 ) 4,653,468 Total liabilities and equity $ 7,997,548 $ 12,379,704 $ 17,244,516 $ (28,358,389 ) $ 9,263,379 NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended June 30, 2019 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Operating revenues Contract drilling services $ — $ — $ 274,817 $ — $ 274,817 Reimbursables and other — — 18,119 — 18,119 Total operating revenues — — 292,936 — 292,936 Operating costs and expenses Contract drilling services 16 — 168,430 — 168,446 Reimbursables — — 15,381 — 15,381 Depreciation and amortization — — 110,538 — 110,538 General and administrative — 170 8,502 — 8,672 Total operating costs and expenses 16 170 302,851 — 303,037 Operating loss (16 ) (170 ) (9,915 ) — (10,101 ) Other income (expense) Income (loss) of unconsolidated affiliates (40,105 ) (209 ) — 40,314 — Interest expense, net of amounts capitalized (3,301 ) (61,184 ) (5,116 ) 625 (68,976 ) Interest income and other, net 71 (3 ) 2,417 (625 ) 1,860 Income (loss) before income taxes (43,351 ) (61,566 ) (12,614 ) 40,314 (77,217 ) Income tax benefit — — 37,182 — 37,182 Net income (loss) (43,351 ) (61,566 ) 24,568 40,314 (40,035 ) Net (income) loss attributable to noncontrolling interests — — (3,316 ) — (3,316 ) Net income (loss) attributable to Noble Corporation (43,351 ) (61,566 ) 21,252 40,314 (43,351 ) Other comprehensive income (loss), net 143 — 143 (143 ) 143 Comprehensive income (loss) attributable to Noble Corporation $ (43,208 ) $ (61,566 ) $ 21,395 $ 40,171 $ (43,208 ) NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Six Months Ended June 30, 2019 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Operating revenues Contract drilling services — — 545,318 — 545,318 Reimbursables and other — — 30,506 — 30,506 Total operating revenues — — 575,824 — 575,824 Operating costs and expenses Contract drilling services 51 — 339,257 — 339,308 Reimbursables — — 24,776 — 24,776 Depreciation and amortization — — 219,310 — 219,310 General and administrative — 173 16,094 — 16,267 Total operating costs and expenses 51 173 599,437 — 599,661 Operating loss (51 ) (173 ) (23,613 ) — (23,837 ) Other income (expense) Income (loss) of unconsolidated affiliates (95,813 ) 1,975 — 93,838 — Income (loss) of unconsolidated affiliates - discontinued operations, net of tax (3,821 ) (3,821 ) — 7,642 — Interest expense, net of amounts capitalized (4,619 ) (132,761 ) (7,344 ) 5,504 (139,220 ) Gain on extinguishment of debt, net — 31,266 — — 31,266 Interest income and other, net 140 (10 ) 9,740 (5,504 ) 4,366 Income (loss) before income taxes (104,164 ) (103,524 ) (21,217 ) 101,480 (127,425 ) Income tax benefit — — 34,317 — 34,317 Net income (loss) from continuing operations (104,164 ) (103,524 ) 13,100 101,480 (93,108 ) Net income (loss) from discontinued operations — — (3,821 ) — (3,821 ) Net income (loss) (104,164 ) (103,524 ) 9,279 101,480 (96,929 ) Net (income) loss attributable to noncontrolling interests — — (7,235 ) — (7,235 ) Net income (loss) attributable to Noble Corporation (104,164 ) (103,524 ) 2,044 101,480 (104,164 ) Other comprehensive income (loss), net 1,201 — 1,201 (1,201 ) 1,201 Comprehensive income (loss) attributable to Noble Corporation $ (102,963 ) $ (103,524 ) $ 3,245 $ 100,279 $ (102,963 ) NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Three Months Ended June 30, 2018 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Operating revenues Contract drilling services $ — $ — $ 247,689 $ — $ 247,689 Reimbursables and other — — 10,680 — 10,680 Total operating revenues — — 258,369 — 258,369 Operating costs and expenses Contract drilling services 74 793 149,881 — 150,748 Reimbursables — — 8,297 — 8,297 Depreciation and amortization — — 128,173 — 128,173 General and administrative 32 565 7,524 — 8,121 Loss on impairment — — 792,843 — 792,843 Total operating costs and expenses 106 1,358 1,086,718 — 1,088,182 Operating loss (106 ) (1,358 ) (828,349 ) — (829,813 ) Other income (expense) Income (loss) of unconsolidated affiliates (613,855 ) (363,431 ) — 977,286 — Interest expense, net of amounts capitalized (15 ) (105,771 ) (11,889 ) 43,545 (74,130 ) Interest income and other, net 1,586 (2 ) 44,812 (43,545 ) 2,851 Income (loss) before income taxes (612,390 ) (470,562 ) (795,426 ) 977,286 (901,092 ) Income tax benefit — — 38,733 — 38,733 Net income (loss) (612,390 ) (470,562 ) (756,693 ) 977,286 (862,359 ) Net loss attributable to noncontrolling interests — — 249,969 — 249,969 Net income (loss) attributable to Noble Corporation (612,390 ) (470,562 ) (506,724 ) 977,286 (612,390 ) Other comprehensive income (loss), net (2,446 ) — (2,446 ) 2,446 (2,446 ) Comprehensive income (loss) attributable to Noble Corporation $ (614,836 ) $ (470,562 ) $ (509,170 ) $ 979,732 $ (614,836 ) NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS and COMPREHENSIVE INCOME (LOSS) Six Months Ended June 30, 2018 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Operating revenues Contract drilling services $ — $ — $ 476,795 $ — $ 476,795 Reimbursables and other — — 16,731 — 16,731 Total operating revenues — — 493,526 — 493,526 Operating costs and expenses Contract drilling services 155 1,397 285,603 — 287,155 Reimbursables — — 12,647 — 12,647 Depreciation and amortization — — 255,812 — 255,812 General and administrative 65 1,183 20,330 — 21,578 Loss on impairment — — 792,843 — 792,843 Total operating costs and expenses 220 2,580 1,367,235 — 1,370,035 Operating loss (220 ) (2,580 ) (873,709 ) — (876,509 ) Other income (expense) Income (loss) of unconsolidated affiliates (744,671 ) (350,913 ) — 1,095,584 — Interest expense, net of amounts capitalized (460 ) (225,592 ) (11,889 ) 87,796 (150,145 ) Gain (loss) on extinguishment of debt, net (2,336 ) 5,419 (11,851 ) — (8,768 ) Interest income and other, net 3,154 (131 ) 88,970 (87,796 ) 4,197 Income (loss) before income taxes (744,533 ) (573,797 ) (808,479 ) 1,095,584 (1,031,225 ) Income tax benefit — — 35,737 — 35,737 Net income (loss) (744,533 ) (573,797 ) (772,742 ) 1,095,584 (995,488 ) Net loss attributable to noncontrolling interests — — 250,955 — 250,955 Net income (loss) attributable to Noble Corporation (744,533 ) (573,797 ) (521,787 ) 1,095,584 (744,533 ) Other comprehensive income (loss), net (1,455 ) — (1,455 ) 1,455 (1,455 ) Comprehensive income (loss) attributable to Noble Corporation $ (745,988 ) $ (573,797 ) $ (523,242 ) $ 1,097,039 $ (745,988 ) NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2019 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Cash flows from operating activities Net cash provided by (used in) operating activities $ 4,572 $ (145,632 ) $ 151,915 $ — 10,855 Cash flows from investing activities Capital expenditures — — (152,354 ) — (152,354 ) Proceeds from disposal of assets — — 9,367 — 9,367 Notes receivable from affiliates — — (28,000 ) 28,000 — Net cash provided by (used in) investing activities — — (170,987 ) 28,000 (142,987 ) Cash flows from financing activities Borrowings on credit facilities 300,000 — 70,000 — 370,000 Repayment of long-term debt — (400,000 ) — — (400,000 ) Repayments of credit facilities — — (20,000 ) — (20,000 ) Debt issuance costs — — (90 ) — (90 ) Early repayment of long-term debt — — — — — Premiums paid on early repayment of long-term debt — — — — — Dividends paid to noncontrolling interests — — (17,538 ) — (17,538 ) Distributions to parent company, net (20,284 ) — — — (20,284 ) Advances (to) from affiliates (284,288 ) 499,814 (215,526 ) — — Notes payable to affiliates — 28,000 — (28,000 ) — Net cash provided by (used in) financing activities (4,572 ) 127,814 (183,154 ) (28,000 ) (87,912 ) Net change in cash, cash equivalents and restricted cash — (17,818 ) (202,226 ) — (220,044 ) Cash, cash equivalents and restricted cash, beginning of period — 17,818 357,232 — 375,050 Cash, cash equivalents and restricted cash, end of period $ — $ — $ 155,006 $ — $ 155,006 NOBLE CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2018 (in thousands) (Unaudited) Noble- NHIL Other Consolidating Total Cash flows from operating activities Net cash provided by (used in) operating activities $ 15,220 $ (206,481 ) $ 270,815 $ — $ 79,554 Cash flows from investing activities Capital expenditures — — (75,874 ) — (75,874 ) Proceeds from disposal of assets — — 3,755 — 3,755 Net cash used in investing activities — — (72,119 ) — (72,119 ) Cash flows from financing activities Repayment of long-term debt — (738,555 ) (213,654 ) — (952,209 ) Issuance of senior notes — 750,000 — — 750,000 Debt issuance costs (822 ) (12,581 ) (1,399 ) — (14,802 ) Dividends paid to noncontrolling interests — — (12,694 ) — (12,694 ) Distribution to parent company, net (29,069 ) — — — (29,069 ) Advances (to) from affiliates 14,925 178,293 (193,218 ) — — Net cash provided by (used in) financing activities (14,966 ) 177,157 (420,965 ) — (258,774 ) Net change in cash, cash equivalents and restricted cash 254 (29,324 ) (222,269 ) — (251,339 ) Cash, cash equivalents and restricted cash, beginning of period 11 29,324 632,676 — 662,011 Cash, cash equivalents and restricted cash, end of period $ 265 $ — $ 410,407 $ — $ 410,672 |