1 EXHIBIT 11.1 DIAMOND OFFSHORE DRILLING, INC. STATEMENT RE COMPUTATION OF PER SHARE EARNINGS (THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS) THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, 1997 SEPTEMBER 30, 1997 ----------------------------------- ------------------------------------ WEIGHTED WEIGHTED AVERAGE AVERAGE INCOME SHARES (1) PER SHARE INCOME SHARES(1) PER SHARE (NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT ---------------------------------- ------------------------------------ Net income...................................... $ 77,831 139,303 $199,295 138,308 Issuance of convertible notes 2/4/97 (2)........ 2,306 9,876 4,418 8,610 ------------------------------- ------------------------------------ Net income per common and common equivalent share ........................ $ 80,137 149,179 $ 0.54 $203,713 146,918 $ 1.39 =============================== ==================================== THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, 1996 SEPTEMBER 30, 1996 ------------------------------------ ----------------------------------- WEIGHTED WEIGHTED AVERAGE AVERAGE INCOME SHARES (1) PER SHARE INCOME SHARES(1) PER SHARE (NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT ------------------------------------ ----------------------------------- Net income................................... $ 38,480 136,563 $ 90,234 120,358 ----------------------------------- ---------------------------------- Net income per common and common equivalent share ..................... $ 38,480 136,563 $ 0.28 $ 90,234 120,358 $ 0.75 =================================== ================================== (1) The weighted average shares reflect the retroactive effect of the two-for-one stock split in the form of a stock dividend to stockholders of record on July 24, 1997. (2) On February 4, 1997, the Company issued $400.0 million of 3.75 percent convertible subordinated notes due February 15, 2007. The notes are convertible into approximately 9.8 million shares of the Company's common stock at any time prior to February 15, 2007 at a conversion price of $40.50 per share. The number of shares outstanding for the three and nine months ended September 30, 1997 was increased to include the weighted average number of shares issuable assuming full conversion of the notes on February 4, 1997 and net income was adjusted to eliminate the after-tax effect of interest expense on these notes.