NE - Earnings call transcript Q3 2020

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Noble Corporation plc Third Quarter 2020 Results Conference Call. [Operator Instructions]. I would now like to turn the call over to Craig Muirhead, VP of Investor Relations and Treasurer. Please go ahead.

Craig Muirhead

Thank you, and welcome, everyone, to Noble Corporation's Third Quarter 2020 Earnings Conference Call. interest company. continued your appreciate in the We

You issued supporting yesterday a copy statements earnings report of Noble's noblecorp.com. evening, at schedules our can on find and website along with the

Vice and are today Officer; Barker, Financial Robert President President Joining Chief Chief and Eifler, and Executive Richard Officer. Senior

question-and-answer remarks. today's a be call, end the not will at For of we hosting session the prepared

restructuring that our over business turn Robert, are I'd performance, filing, everyone the Chapter subject are remind and about statements call financial to historical statements or not opportunities, we I or operations, make to that Before to may or uncertainties. that plans, plans, are activities XX risks like certain forward-looking facts other operational matters drilling the and

including restructuring cases, Exchange and Commission, risks being pandemic operations, any realized, Chapter the oil to the outcomes Securities risks. the demand, U.S. forward-looking which discuss posted various and price contemplated, keep and from on our other impact and as the with uncertainties consummate COVID-XX Noble's operational factors filings and industry on of XX the of of statements our ability our website, in customer business and the gas, resolution could are of that Our our our

referencing materially financial Noble these obligation are call and Also measures Our any actual results in could differ not non-GAAP does statements. today. we from note, assume forward-looking statements, to these our update

over our these And to call required and for and directly supplemental measures, the now associated GAAP You of Executive disclosures I'll Officer President Eifler, turn with an website. the find on Noble. Chief including measures will Robert comparable that, reconciliation the most

Robert Eifler

Craig. Thanks,

made process under for filing Chapter Code, U.S. of finalizing and our XX towards Bankruptcy progress XX July our steady the emergence. protection Following We've

our for and existing new $XXX our outstanding new of largest provide equity, a $XXX we comprehensive million with from debt that bank would from prearranged our all credit bondholders bond capital for group. million filed with a of our convert restructuring facility creditors reminder, to agreement As a provide a existing

our element great cleared Trust. the the by to critical Paragon we've creditors, reaching progress a addition uncertainty In with a settlement Litigation with of

While remains jurisdictions, of could maintain unknown our COVID approvals or affected and shutdowns of we to control, be several certain year-end emerging by our the timing and in soon prior of regulatory outside target thereafter.

court a from several remains Our we believe what potential of was that call. creditors, Due to are and our an position activities, give will the customers, will decision session path details best we more a the in But review pursue employees. support environment, to challenging will to I comprehensive thorough very on moment. a be our would restructuring ongoing Richard alternatives. like and some first, vendors received on update. question-and-answer broad after a today's We we grateful process not have give operational restructuring to this Noble and holding reached navigate a for related

industry to one have uncertain. continues we in the environments difficult remains decades. most industry Our entirely Timing any of of endure recovery seen

an become significant safe support efficient still Despite in restrictions operations and COVID-XX. our time have the our the and the of operation and challenges, crews face to team part unfortunate travel around Our that teams deliver to Noble of customers continues quarantine business world. the

crews, third $X.X XXXX. and from customers billion end contract in at X.X Guyana, Tom from extend the backlog additional personnel, such the XXXX. commitments end our Noble work on Madden. of X those Having X the our which Madden's $X.X our commence focus Sam maintained have second expected the of awarded ExxonMobil a is of to to this Since would increased the with have been quarter. work quarter almost hard first uncertain under We shore-based during have of who times the to the is Tom challenging years we the billion at of Noble quarter work achieved Croft, this This work testament to into end quarter, conditions. second has months been of the of awarded of in the years is the

Commercial However, the to to Agreement, terms or rigs backlog of their CEA, our other Enabling this shift Exxon allow at option.

further So investment may economies allows supports CEA. workforce. under spread local in by see we further multiyear developing and Noble contract term realize rigs this over Guyanese operations, additional scale commitment to our The of the multiple including our us

drillships at with those Globetrotter The contracted with Two Boudreaux Noble end and extremely with Globetrotter and our remain of offshore U.S. XXXX Mexico, Malaysia. under XXXX are one for which their the of remained opportunities. the are premier warm in demand the extend stacked continue the drillship contract into II, exploration partners, participation QX. world's of and Guyana, in pleased development currently of XX Clyde has We relatively majority ExxonMobil relationship of our In to offshore flat and our respectively. Shell and XXXX, is I Gulf

are the of rate be half bidding on XXXX. opportunities hopeful will in first get day numerous We and are back to into we able

rig the the On at the Equinor, regulations XXXX. for jackup will some Equinor with bring equipment time world platform. Lloyd one is will Norway side, the There customer. on rigs which contract-specific with technologically shipyard announced are to compliance the the the Noble in we and take be jackup Noble been most The Lloyd request to of of in performing very well has previously proud of Noble contract add our current and into the to very Mariner Norway advanced

million natural in for design in good contract. like the country. $XX are challenging the We we Of CJXX currently of million commencement rigs is the future XX market a the in The region, and $XX expect Noble, Lloyd we expect contract work before this a will jackups project under net mid-XXXX. Norway of a opportunities Sea been high-spec have cost XX North has for year. market there to

rigs several X a are programs in number other XXXX, jackups jobs. bidding up our P&A the of to against -- the And well soon. region while There extremely other opportunities. there to in competitive, X of you news dates fleet uncontracted Noble, several our in with some Lloyd the we are market Excluding are start on and contracting available measures have including hope additional remains the believe

Aramco rate. contract Roger a to Aramco, rig day rigs to We Noble on May although put X continue on framework, just XXXX, X has with Scott similar until standby the which on at Noble for rate Saudi have put XX X at the Marks been and is the standby months suspension up allows to on Lewis

Trinidad order are begin will Regina not XXXX. floater Noble of August Overall, The will Mick in stood for This starting require Elsewhere the At on suffer work and rigs of uncontracted significant investment to back into for demand in contract sustainable. current customer bring Noble been in at Noble keep the there XXX currently Tobago. Qatar market. oversupply. floaters, a end XXXX. has the total the drilling rigs contract And the versus QX, cold-stacked which the Prosser with Australia, to in them continues O'Brien, extension to worldwide period warm November. stacked, with a from XX Of We units to for total several XX is the of it BHP we is rigs, commenced have standby which shipyards and in including market Tom XX%. its expect additional supply, in but late the utilization our opportunities awarded its Allen chasing jackups,

costs for the side, with daily the in uncompetitive is for retired held XXXX, market outlook widely cost On cost XX from on And value. cold-stacked a Year-to-date recovery, industry which the attrition. the the even exceeds the company's full rigs. of but cold-stacked rigs jackup longer financial justify the different, year positions to rigs have numbers The it support maintaining delayed of modest maintain. becoming require to are harder service, option already and XXXX story same. is currently the Even expectations rigs no been

further have further drilling activities taken our of look based bolster market expectations our Hence, on restructuring their continue call high-spec a conditions. facilitate expect at on contractors our to our hard update efficiency. retirements X at future fleet an already the may to over update cold-stacked We These as recent attrition. details Restructuring flows At as a drilling rigs. contractors well. our number Noble, retirements and we turn cash of high-grade of on efforts process. now give I'll to cost further more announcement Richard towards fleet our and dispose our rig results to financial

Richard Barker

on start restructuring you quarter Good I welcome of Thank with will my highlights process. then some I also of our with third where morning, brief we today's each you, overview Robert. an are give results call. like would and of to our everyone. comments

loss net or the Chapter diluted XX the revenue third after of compares second million total $XX was As quarter, our announced into adjusting of yesterday, $XXX Adjusted $XX the filing. for Noble which $X.XX quarter third translated a the $XX to in million million various EBITDA company quarter. This per million share. in generated to of items adjusted in EBITDA to related restructuring

were revenues $XXX quarter. in million up third $XXX to the slightly Services million Drilling the Contract versus Our in second quarter

remain We highly structure. cost continue to on focused managing our

a quarter. third G&A from basis savings. Services the our run realized on and In were Contract $XXX million, Our reduction previously we cost third X% a second announced fully costs quarter shore-based the Drilling rate quarter,

reactivation our is economic five decision the discussed, Additionally, outlook This we costs dispose as the and these right given to coupled costs, with Robert assets. of carrying market have current for decided cold-stacked the floaters.

and are While industry-leading maintaining an committed structure flow exists, free minimizing market significant cost uncertainty to burn. cash we any

at primarily This the July cash to balance $XXX audits. as million is was additional September collecting prior prior receipt of We tax anticipate the near Act CARES cash in related over provisions the refunds CARES in year in a tax million. received $XXX we Our closures Act million of the of refunds as end the the quarter as of certain still increase well future. $XX approximately of result

customers and year expenditure estimate for million. to capital anticipate $XXX is $XX and million between full the million $XX between range expected $XXX our reimbursement now XXXX of million, from which we of Our

spending is as some it the into towards adjusted expect this the year. of XXXX we to could spend While end timing amount, of projects the possible push of is that this

progress are our with the pleased we We making in process. restructuring are

of for over all of our has over the of XX% outstanding Our the with XX% the over equitization of of holders currently provides notes. of and the full plan support The of which Court bonds, guaranteed plan today. billion holders $X.X notes legacy of the reorganization total filed

agreement new of backstop maturity. of a commitment with executed with notes to these $XXX contribute holders form X-year have supporting capital a the lien in million We second

the and option cash interest in flows. flexibility further which pay these our us to managing We around kind provide will notes, have will liquidity on

attractive an We under with which million remaining the free At $XXX at credit runway. become as our down effective will are excess $XXX maturity approval having emergence lenders court. upon for documentation a will from cost credit of also borrowings any drawn. bank available emergence. the and and to facility are Noble still We $XXX anticipate approximately emergence, cash capital. from not each proceeds the have to first second of of with second million lien our liquidity now at agreements to the scheduled agreements use they we credit and of additional multiyear revolving currently require lien approximately a final the facility million signed Both facility, $XXX by new lien notes pay meaningful These borrowings provide X-year commitment the currently million liquidity bond

is November will XX. plan confirmation quickly restructured hearing, Our is on as as our If for towards a hearing emergence month as at possible we restructuring scheduled company. this move approved later this

As navigate position our we in and financing us cash market turn deal employees which corresponding a consensual have expense, customers, of grateful reduced creditors, restructuring. our comprehensive for with conditions. sustainable are current leverage create stakeholders to enhanced our support back the we it interest after I we Robert liquidity will capital and Robert. the significantly costs, provide mentioned, an to suppliers structured will have structure flow The will now improved as and

Robert Eifler

of challenges number our industry today. a face We Richard. in Thanks,

safety recently, for attention fossil familiar fuels. like and will outlook, have our COVID XXX away years. a our more from customers on continue have are as for Regardless, we excellence operational depressed of Some as world-class the delivering focus turning others and effects almost like we investor to sentiment maintain and market done company performance the gained

governance will We and the continue social effectively issues environmental, flows. address our company cash manage and also for to efforts

on our emergence at day. of call XX, customers I pleased the consensual industry. to call. and in remarks. to that for every will concludes the confident our platform the are turn proud lenders am We have you in our our with support I especially a strength of from our received And I'm your to of Noble men continue deliver close noteholders the a and That solid and to Chapter the who participation operations now operator excellence Thank for Noble operational prepared restructuring. financial it to combined lead will position back the women today,

Operator

This concludes today's conference call.

may You now disconnect.

Craig Muirhead	VP, IR & Treasurer
Robert Eifler	President, CEO & Director
Richard Barker	SVP & CFO

Noble (NE) 5 Nov 202020 Q3 Earnings call transcript