Rowan Companies 8-K Rowan Reports First Quarter 2007 Operating Results

EXHIBIT 99

News Release

Rowan Companies, Inc.

2800 Post Oak Boulevard, Suite 5450

   Houston, Texas 77056 (713) 621-7800

FOR IMMEDIATE RELEASE     & #160;  May 2, 2007

ROWAN REPORTS FIRST QUARTER 2007 OPERATING RESULTS

HOUSTON, TEXAS -- For the three months ended March 31, 2007, Rowan Companies, Inc. (RDC-NYSE) generated net income of $86.4 million, or 77¢ per share, compared to $62.4 million, or 56¢ per share, in the fourth quarter of 2006 and $59.1 million, or 53¢ per share, in the first quarter of 2006. Revenues were a record $462.3 million in the first quarter of 2007, compared to $410.9 million in the fourth quarter of 2006 and $299.8 million in the first quarter of 2006.

The first quarter 2007 results included $24.1 million, or 14¢ per share, of gains on asset sales, compared to $2.5 million, or 1¢ per share, in the prior-year period. There were no significant asset sales in the fourth quarter of 2006, though that period included $12.8 million or 10¢ per share of charges related to environmental matters. The first quarter 2007 results also included $11.3 million, or 7¢ per share, of incremental loss recorded on the Company’s external rig construction project, bringing the total expected loss on the project to $13.4 million.

Rowan’s offshore rig utilization was 84% during the first quarter of 2007, up from 81% in the fourth quarter of 2006 and 78% in the first quarter of 2006. The Company’s average offshore day rate was $143,300 during the first quarter of 2007, down by $1,100, or less than 1%, from the fourth quarter of 2006 and up by $15,100, or 12%, from the first quarter of 2006.

Rowan’s land rig utilization was 92% during the first quarter of 2007, down from 95% in the fourth quarter of 2006 and 98% in the first quarter of 2006, though the number of rig operating days increased between periods. The Company’s average land rig day rate was $23,900 during the first quarter of 2007, up by $1,200, or 5%, from the fourth quarter of 2006 and up by $1,700, or 8%, from the first quarter of 2006.

Danny McNease, Chairman and Chief Executive Officer, commented, “Our redeployment of assets has, for the time being, been concluded and, by this time next week, all of our offshore rigs should again be generating revenues. Demand for jack-ups in the Middle East and many other foreign markets remains strong, and we are continuing to aggressively pursue long-term opportunities abroad.

“While we remain confident in the long-term viability of the Gulf of Mexico jack-up market, we believe the migration of high specification rigs to other areas will continue. We expect to have fewer of our own jack-ups located in the Gulf of Mexico a year from now than we do today.

“Our manufacturing operations contributed record revenues during the first quarter and we continue to believe that even better days are ahead. Our drilling products and systems comprise over 90% of our current backlog and we expect that demand will continue to grow.

“Our first quarter manufacturing margins were adversely impacted by the additional loss recorded on our external rig construction project, which was undoubtedly affected by the significant demands from our drilling division during the accelerated construction of the Hank Boswell, rebuilding of the Rowan-Louisiana and modifications to our Middle East rigs carried out over the past several months.”

Rowan Companies, Inc. is a major provider of international and domestic contract drilling services. The Company also owns and operates a manufacturing division that produces equipment for the drilling, mining and timber industries. The Company’s stock is traded on the New York Stock Exchange. Common Stock trading symbol: RDC. Contact: William C. Provine, Vice-President - Investor Relations, 713-960-7575. Website: www.rowancompanies.com 

This report contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected financial performance of the Company that are based on current expectations and are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected by the Company. Among the factors that could cause actual results to differ materially include oil and natural gas prices, the level of offshore expenditures by energy companies, energy demand, the general economy, including inflation, weather conditions in the Company’s principal operating areas and environmental and other laws and regulations. Other relevant factors have been disclosed in the Company’s filings with the U.S. Securities and Exchange Commission.

-2-

ROWAN COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited (In Millions)
		MARCH 31
		2007		2006
ASSETS
Cash and cash equivalents	$	420.2	$	553.2
Accounts receivable		371.8		336.9
Inventories		394.6		236.2
Other current assets		71.0		65.1
Total current assets		1,257.6		1,191.4
Restricted cash		50.0		-
Property, plant and equipment - net		2,191.7		1,818.9
Other assets		55.3		37.1
TOTAL	$	3,554.6	$	3,047.4
LIABILITIES AND STOCKHOLDERS' EQUITY
Current maturities of long-term debt	$	64.9	$	64.9
Accounts payable		124.7		104.8
Other current liabilities		341.2		230.2
Total current liabilities		530.8		399.9
Long-term debt		466.7		531.6
Other liabilities		607.1		455.5
Stockholders' equity		1,950.0		1,660.4
TOTAL	$	3,554.6	$	3,047.4

-3-

ROWAN COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited (In Millions Except Per Share Amounts)
		THREE MONTHS
		ENDED MARCH 31
		2007			2006
REVENUES	$	462.3		$	299.8
COSTS AND EXPENSES:
Operations		304.4			172.4
Depreciation and amortization		27.6			20.1
Selling, general and administrative		22.4			20.3
Gain on sale of property and equipment		(24.1	)		(2.5	)
Total		330.3			210.3
INCOME FROM OPERATIONS		132.0			89.5
Net interest and other income		0.6			2.8
INCOME BEFORE INCOME TAXES		132.6			92.3
Provision for income taxes		46.2			33.2
NET INCOME	$	86.4		$	59.1
NET INCOME PER DILUTED SHARE	$	0.77		$	0.53
AVERAGE DILUTED SHARES		111.5			111.8
NOTE: See pages 6 and 7 for supplemental operating information.

-4-

ROWAN COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited (In Millions)
		THREE MONTHS
		ENDED MARCH 31
		2007			2006
CASH PROVIDED BY (USED IN):
Operations:
Net income	$	86.4		$	59.1
Adjustments to reconcile net income to net cash provided by (used in) operations:
Depreciation and amortization		27.6			20.1
Deferred income taxes		10.5			28.3
Gain on sale of assets		(24.1	)		(2.5	)
Other - net		9.4			9.6
Net changes in current assets and liabilities		1.1			(94.5	)
Net changes in other noncurrent assets and liabilities		19.3			(2.2	)
Net cash provided by operations		130.2			17.9
Investing activities:
Property, plant and equipment additions		(69.4	)		(109.0	)
Decrease in Restricted cash balance		106.1			-
Proceeds from disposals of property, plant and equipment		24.2			8.6
Net cash provided by (used in) investing activities		60.9			(100.4	)
Financing activities:
Repayments of borrowings		(18.7	)		(18.7	)
Payment of cash dividends		(11.0	)		(27.4	)
Proceeds from equity compensation plans and other		0.8			5.9
Net cash used in financing activities		(28.9	)		(40.2	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		162.2			(122.7	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		258.0			675.9
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	420.2		$	553.2

-5-

ROWAN COMPANIES, INC.
SUPPLEMENTAL DRILLING INFORMATION
Unaudited (dollars in millions, except where otherwise indicated )
		THREE MONTHS ENDED
		March 31, 2007					December 31, 2006					March 31, 2006
		$		% Revenues			$		% Revenues			$		% Revenues
DRILLING OPERATIONS (a):
Revenues	$	288.3		100		$	280.6		100		$	217.1		100
Operating costs		(146.8	)	(51	)		(146.9	)	(52	)		(107.0	)	(49	)
Depreciation and amortization expense		(24.1	)	(8	)		(21.3	)	(8	)		(17.4	)	(8	)
Selling, general and administrative expenses (b)		(15.7	)	(5	)		(14.0	)	(5	)		(15.3	)	(7	)
Gain on sale of property and equipment		24.1		8			0.1		0			2.2		1
Charge for estimated environmental fine		-		-			(9.0	)	(3	)		-		-
Income from operations	$	125.8		44		$	89.5		32		$	79.6		37
OFFSHORE RIG DAYS:
Operating		1,587					1,514					1,338
Available		1,890					1,860					1,710
Utilization		84	%				81	%				78	%
LAND RIG DAYS:
Operating		2,154					2,036					1,505
Available		2,352					2,148					1,530
Utilization		92	%				95	%				98	%
AVERAGE DAY RATES (in thousands):
Gulf of Mexico rigs	$	127.7				$	140.1				$	123.0
Middle East rigs		132.3					114.3					-
North Sea rigs		213.4					195.6					147.3
All offshore rigs		143.3					144.4					128.2
Land rigs		23.9					22.7					22.2
(a) Amounts exclude effects of intercompany transactions.
(b) Amounts include corporate SG&A costs that are allocated between operating segments.

-6-

ROWAN COMPANIES, INC.
SUPPLEMENTAL MANUFACTURING INFORMATION
Unaudited (dollars in millions)
		THREE MONTHS ENDED
		March 31, 2007					December 31, 2006					March 31, 2006
		$		% Revenues			$		% Revenues			$		% Revenues
MANUFACTURING OPERATIONS (a):
Revenues	$	174.0		100		$	130.3		100		$	82.7		100
Direct cost of sales		(148.7	)	(85	)		(103.4	)	(79	)		(58.9	)	(71	)
Other operating costs		(8.9	)	(5	)		(7.9	)	(6	)		(6.5	)	(8	)
Depreciation and amortization expense		(3.5	)	(2	)		(3.3	)	(3	)		(2.7	)	(3	)
Selling, general and administrative expenses (b)		(6.7	)	(4	)		(6.3	)	(5	)		(5.0	)	(6	)
Gain on sale of property and equipment		-		-			(0.1	)	(0	)		0.3		0
Income from operations	$	6.2		4		$	9.3		7		$	9.9		12
REVENUES (a):
Drilling Products and Systems:
Offshore Products	$	67.1		39		$	45.0		35		$	19.1		23
Drilling Systems		35.6		20			22.3		17			15.9		19
Power Systems		17.4		10			13.6		10			3.6		4
Mining, Forestry and Steel Products		53.9		31			49.4		38			44.1		54
Total	$	174.0		100		$	130.3		100		$	82.7		100
MANUFACTURING BACKLOG:
Drilling Products and Systems:
Offshore Products	$	209.0				$	263.5				$	277.1
Drilling Systems		192.3					190.4					76.1
Power Systems		25.9					22.7					24.7
Mining, Forestry and Steel Products		34.3					53.4					63.9
Total	$	461.5				$	530.0				$	441.8
(a) Amounts exclude effects of intercompany transactions.
(b) Amounts include corporate SG&A costs that are allocated between operating segments.

-7-