SDRL - Earnings call transcript Q1 2024

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Operator

Thank you for standing by. My name is Kathleen, and I will be your conference operator today. At this time, I would like to welcome everyone to the Seadrill First Quarter Earnings Call. [Operator Instructions] I would now like to turn the call over to Lydia Mabry, Director of Investor Relations. Please go ahead.

Lydia Brantley Mabry

operator. you, Thank First Seadrill's Earnings Call. Welcome Quarter to XXXX Ali, from call Grant President our feature and Creed, Commercial and remarks will prepared Simon Samir Officer; and Financial Vice and Johnson, Vice Officer. President President Chief Today's Executive Chief Executive Chief Executive Officer; Operations. us of the Vice on joining is Marcel Also Senior Wieggers, call President Today's call that statements and risks may involve include forward-looking uncertainties. Actual results may differ materially. year, to should valid later quarter or remain update. these obligation in no statements and forward-looking assume assume No one we the

filed and with provide business. X-K U.S. factors Our Securities discussion Commission, latest and Forms our Exchange the a of and XX-F affecting our the detailed more forward-looking statements risk

During the call, measures. may we to non-GAAP refer also

filed release nearest measures available earnings corresponding Our GAAP website. is the to SEC includes reconciliations and the our with on

on defined EBITDA today's term adjusted our in EBITDA with term the corresponds the as call release. of earnings use Our

Now to let call turn me over Simon. the

Simon Johnson

quarterly We in us strong $XXX highest of first operations joining million current for contract safe, start you XX.X% benefited from we floater to returned the efficient day our fleet. million cycle, customers, our announced EBITDA margin. the quarter to announced to strong results we the last $XXX,XXX one-well for recently maintain quarter, rate as across year. at to strive securing marking a We and Thank rate the call. of clean consistent pricing improvement the from delivered up revenue, a top approximately EBITDA in In our uptime. E&P day, the per Seadrill and benchmark quartile our had recorded $XXX we conference rates

progress make to several continue areas. we key organization, an As in

one we their completions, the Brazil, and preparing the for X Vela X manager ago, Petrobras Seadrill the contracts Capella do and same and years Less following and began the Auriga, with year. In rig March, Polaris for their X West fleet, Petrobras moved rigs Auriga West the in we contract Brazil. reintegrated into West Polaris we Equinor. than this and the West we'll recent the third-party into terminating First,

the with and and systems approval upon and and So, processes have recognize issues. any to customer early potential and acceptance country act we familiarity have the indicators of near-term experience

While we rigs to are effectively are and start year-end acknowledge generating we and large committed preparations managing any contract cash inherent so flow project, executing those risks can scheduled. the in that EBITDA full

when Next, jack-up rigs, aware update that we rigs. our an further Qatar potential market our floating transaction provide for continue a core divestiture our to efforts on enterprise We'll X available. sell focus our will segment this on keenly

shareholder And year, allocation accretive our or million growth for an shareholders once remain ensured market share a XXXX, million equity rates proposition. Lastly, gas our September have potentially through continue sheet, Since of balance We part capital our by left nearly to attractive returns competitiveness consistent XX%. of XXX of encouraged in of initiating XX.X% and we market advantageous The believe remains active opportunities. its offshore count, deepwater it. evaluated our policy, we solid fundamentals our underpin the of rig have of oil share reserves, returns outlook, exceeding rig performance expansive deepwater issued of source production floaters and profiles. with Since current to both our floaters a we've total buoyant, the high with strength intend fleet of excess offshore emissions the with repurchased return $XXX market. return deliver utilization and we consistent in marketed repurchase invested remain our value will that last and We of our in program. we program capital fundamental the consider $XXX capital to strength the

precious the period, few have rigs Over entered. same

forward, amounts going thus of We time across believe may the material demand market geographies. single or of million incremental is longer and shipyard the drilling reactivation trickle limited service million they continued if to that almost be Some owner work. for far, entered Triangle these in have contracts on across into the be less base approach industry's rigs low or capacity The remains been remain on broadening money only largely It still stack and the they're inactive, that when material, contract. stack and a their recovery sideline require side. all, supports to at into exceed but the prepared exceed the Golden demand distributed is side further not it justify market the increasingly deepwater secure The to has always room rigs at $XXX reactivation that costs $XXX can a high return but The to is upswelling the engine challenges production, development. more will been of and likely supply-driven a epicenter. locations

net sequencing of the grind demand. do and we continue So, said, market will supply expect higher. to not That

today's aspects growing production One market preference is of timing. over market challenging for of cloud flow the E&P cash can visibility. most

customers market not Aside cycles. Discrete contracts supply and be simply to around from visibility of relatively delays instances we of maximum the term, supply industry, an do result for to to a in permitting, extensive window. further contributing have contracting, may chain momentary as and rig challenges within level same that compressed a intense and in activity demand can some efficient -- X- appear enjoyed unique drillers operations schedules offshore mismatches most in past even seeking affect terms. X-year

environment, operations price this demand. strength and there's geographies ability premium market in to day flow, advantaged dislocation supports to the volatility In durable result rig solidity. potential floater rig may and the further environment in this our of the whilst delay or So, provides maximizes Operating rate our a potential sheet and cash positioning power. nonetheless a balance that utilization conditions resilient general fleet of for oil earnings changes generate continuity improves, earnings ensuring our in of in

we of service trend the rates better. downtime and the higher, day opportunity can cost and the out unpaid unplanned progresses cycle the minimize of time, As more rises

team rig spent depth We're equipment the way like the that commercial threshold extent nondrilling of rate for and contractors standby, to of better maximize for protections uptime, the to allowances to downturn. on contracts and waiting downtime terms and the some practicable. conditions the repair schedule Meanwhile, maintenance and potential project for days raise that aim intrusion activities Our and necessary teams lost address percentages secure and on in the repair operations upgrades and triggers earning weather. perform our maintenance, the improve and continues to minimizes drilling higher back to contracts a recertifications, advocating

towards a on a than periodic capital our state explicit class beyond timing coastal flag compliance the fleet continuous related range a move maintaining, or As periodic can precise. expenditures become our may change, and in falsely special rather survey to on to basis, we typical million for million SBS, an the investing $X to spend guidance providing of $X begin

talk out-of-service during preparation days we the contract. SPS operate example, year, out-of-service scheduled targeted position competitiveness advantage remain of you. the capable X Seadrill. ago. our will than to scopes line. the view so deepwater of what Admittedly, will later shareholder maximize spending additional encouraged the expect their contract of ] beyond and upgrading along demand [ teams strengthen that For taking the forward. out or Meanwhile, name can spend the MPD that customers of how spend. individual you and X them. the when efficient spending, investment West no achievements Seadrill, assured, SBS XXth classification mobilizing appreciate what's minimal change solely how to move this rest and operations drilling that the may service the temptation we fleet, on accounted the focus our the holistic we her outlook. we marketplace their going ensuring by to years rig employees, a continued begin reach about underwent maintain before do continuous take reckon delivered pressure But operational require I'm we already date, and planned extensive across Neptune managed period in anniversary and as associated towards have the Brazil of with traditional XX-year business, proud Regardless our we capabilities at with downtime To from market on for commercial continue returns. drillships spending This they we deliver all market they time out X-year the we only our safe, in of this I to to leading the we is Seadrill rig We And increments, less discrepancy driller. equipment should effort improving a thank make a our the in top fleet

general and are of improve our We we our efficiency our which quality delivery to operations. support cost service with performance, efforts continuing

by business remain culture demand. an mindful increased to to could previously Grant. and appropriate volatility having the believe in With we of mentioned, characterized that changes the As the meet to I'll the we that, ready company ensure call is ever pass any importance be cost of

Grant Creed

planned We had in offset special contract for of economic revenues underwent quarter, days, late maintenance. work decline January, [ durations. a quarter a and flow, West the survey drilling guidance. X late fewer Simon. of $XX accounted quarter, rigs were Mexico The and West $XXX completed [ Sevan Contract primarily for lower off previous full periodic for ]in balance of its of its operating million. million. BP speaking out-of-service with the in revenues cash first December U.S. because required its than Gulf review XX-year year we ] sheet I'll Auriga Thank Louisiana $XXX total Thales February. work our Mexico for our partially At U.S. period The in in you, almost sequential before in the difference. varying results the The revenues Gulf improved all financial delivered million campaign and In the Polaris on drilling that utilization. completed late TGC operating first completed contract the by

to Polaris we As EBITDA increase Simon offset million cash Petrobras recovery and into to was activity and their import in rig the duties them relative the sequential primarily we during Auriga $XXX above million first reduced of million, $XX from related the fleet historical expect for and to the quarter the that economic in March, a of the XXXX. Louisiana, tax and utilization mobilize contracts. credits the shipyards Polaris Auriga, preparation be $XX relation benefit for benefits will quarter, to XX% partially to Seadrill's earlier, mentioned strong upcoming in reintegrated related by to described form of QX translate in

explains the part certain noncash performance. of million therefore, in repairs not accruals. Additionally, prior A QX by our timing as these we was and repeat of and quarterly call, $XX first negatively -- spending in did improved mentioned of the quarter impacted the maintenance and

First and our and quarter XX.X%. of the expenses headquarters to the results nonrecurring costs net London to line also revenue costs. out consolidation back adjustments the corporate $X was reimbursable in integration the in of SG&A Houston closure $X of of margin, million office include in Aquadrill and EBITDA million relation to related company's

cash a financial from million million our we and $XXX leverage operations for was $XX share and balance employee a X. flows on quarter, to the the Net Now $X turning strong by repurchases. impacted sheet. interest net total our long-term shareholders of annual we of remaining of to less in $XX payments first were in $XXX and resulting restricted upgrades million the returned desire $XX quarter Cash quarter, date, Capital deducting borrowings cash made of debt position flow gross cash than current an under maintain a cash balance operations flow the in was was quarter the million captured position. additional investing the undrawn of credit incentive million, In available from we flow of payment a bond, $XXX maintenance the cash the $XXX revolving million $XX authorization. and first CapEx. To repurchase for after million, consistent secured to million $XX free had of million convertible made and Cash maintain million. million including in the flow from $XXX and At with facility. of our total biannual have million $XX debt end of the sheet inclusive We $XX of quarter, million, bond.

billion previously $XXX think guidance about we fourth $X.XX our $XXX expenditures. shared earnings million the is in we and $X.XX to capital As million $XXX our quarter That to EBITDA year on million year, call. full in revenue, maintain $XXX billion in million to

that, $XX million and net expenses. and approximately includes I to Our guidance amortized man. With of million $X will pass mobilization reimbursable in line revenues expense noncash the

Samir Ali

an last summer, the brief start per Neptune I'll The the to Grant. partnership in fleet well intervention Louisiana of to West and of and in LLOG up that you, rate the an unit. could interesting this rig of Mexico. decade-long participate serviced a activity The these day. Louisiana to Capella on our plus we segment cycle Korea, with encouraging campaign BD does the [ offer XXth contract application Thank riserless West the $XXX,XXX in by XXXX future-proofing this contracting through indication Note clean secured the traditionally believe ] covered begins beyond. new build additional the short the in We Mexico not provide a a higher intervention. compelling the a Capella as When work, The rigs, rig present additional rate for be a next April, and of market potential include will that market. prove themselves. pending of be rate to drilling for wanted continue secures work, West Sevan contract for could not it We through operator market's fully rate we Gulf testing the it space Louisiana. Gulf, opportunities Also fill achieved the this move contract rate MPD scheduled earn secured at XXXX. its then In becomes our mid-August awarded in times day update will its the charge. the this work home, in the by marketability interventional an to per like highest or approvals. thereafter, Neptune, our a the with to pending contract call to May. work current Even the extension U.S. white of by it should since $XXX,XXX represents we lead which in mobilization, contracting and the for is rig asset has recommence both the and of have is In Indonesia Gulf since anticipate an in current believe X-month drilling in short have XXXX, reviewing though continue will if priced time the still begin progression work an potentially shortly final in we December. Closer should capabilities, complete on new will

the precarious market secure or fail work competitive Norwegian Phoenix. whether Turning contract suitable generates undersupply, North Sea of Norway that to on oversupplied can fortunes influence markets. is X our we attack Norway Norway. rig. that influence the for is an West intention The it evolving the rig will If rig a other balance either situation returns, or the secure we in to X

today. we are Looking contracted ahead as XXXX, of into XX%

markets we progression. Simon the dispersion As across earlier, confident mentioned the demand by including day and to on rig remain uncertainties supply discussions despite the timing contract, of some the in market encouraged demand, from limitations, conversion rate

Louisiana to operate. are mid-XXXX. mid-XXXX. and the target the Vela existing become applications. availability dialogue rigs, advantaged markets both and capabilities design completes to advanced unique Libongos, Capella benefits in niche program where the in Capella Since it of and its the the our allows believe Sevan already Quenguala in available tankard remainder in And for fill all when and the from West they MPD we are Hall the rig West near-term we the Specifically Louisiana's

to here, design. not for in well our against case While scheduled, That primarily prefer not not work. slips stagger by contracts, ourselves we we so to rig is are the due the competing

consistently percolating able the secure in to it some questions. like demand the the sum fundamentals other in to weight continues X all business. that we the To now Fortunately, is as rigs markets option above in positioned and pockets continue area. there have be air open believe African our and Angola West up, we'd work for should well to that we we in we believe Despite an highlighted, of unfold. to long-term our for Operator, previously call punch are recovery it

Operator

comes line question-and-answer begin Ben Stifel. Your the We Instructions] now Nolan question of will [Operator first from session. the of

Benjamin Nolan

the Or thinking I doing markets. that? around might Any be to the Capella all, day. wanted any you another Korea. X about Is color. the It's So, rig it well on on an ends first X that to core the ask, behind West the South unusual And are sort opportunity Capella location. West wanting there there appreciate X I you're in how of that? of congratulations where your to eventually move color up, back of

Grant Creed

Sure.

that. to win there we're we of move opportunity the little few it stay So, one rigs look it to proud is there of Asia. for contract for either one in that our it but got she's potentially. great was that's would a longer back for Could market us, us, it in core markets, that's And of also a Southeast quite and little But MPD.

So, us, saying, a are Asia, back staying we the to happily Southeast stay justifies bring "Hey, market as we we that it find broader or and looking core we'll opportunity market could there the at for in if well. right

Benjamin Nolan

And Okay. that how would any on develop? thoughts might quickly

Grant Creed

in say dialogue that. now right we're for I'd

however announce be of now, that nothing we long are but dialogue takes. right going Korea after at most in to point. So, this the advanced to But that's work,

Benjamin Nolan

solid to keep a why then Phoenix rig, to would to that a and that little opposed Okay. environment a it I the unable it go bit just if trying running. maybe choose or get a a the little the a And contract appreciate you direction redeploy to as that. you're to would being you benign on stack curious to And environment, either then over your in curious opportunity commentary harsh undersupplied. I was about West little

Grant Creed

Yes.

well. at So we're looking benign environments definitely as

not too harsh. we're just limiting So for ourselves us,

-- take away. want feel or you I to that So don't

I investment put the now evaluating is do think we on in well. if that the is for capabilities of if rig there to what we not but benign different we're doing And probably environments we're opposed for rig. it as at then to that us, to Phoenix, required various right stack an in. investment, looking logical, make most capital. could the work return we'll get And markets don't, environment we the a But given look our is harsh the we

Operator

Your next of line Lewis BTIG. question comes the Greg from of

Gregory Lewis

Phoenix. a on the of XX-year up be Samir, next expect to I that what survey? see like, following its of to months, rig just given in contract to that In contract rig couple on get special question guess, shipyard survey, the Simon were or in that that, the just we the event say, should -- Ben's we long kind how a undergo

Simon Johnson

It really The... is to on rig going the where Greg, depends, be deployed.

Gregory Lewis

Some base saying. it north in stays case, the

Simon Johnson

Well, CS Norway, it's -- there's be to a be than stays project if U.K. will for. in if in it going working the then it larger

lot allow So, to going make we've yet. confirmed work the would is at current this -- to outstanding commitment we that have that we our lead do we're of contract. the haven't Really, us stage, survey of timing bought about as But that as to reluctant conclusion a items long expenditure upon until clarity capital forward.

seen recent one forth. new NCS terms of the guidelines growth equipment and compliant that so features think of been requirements in years surveys a doing of particular, the staying and with these in in in cost I has the regulators' in the we've

underwrite be cost. and that of So, we really sufficient sure that to a work there's there commitment to need body

Gregory Lewis

Super helpful. Yes.

I to work. to appreciate think so Africa, a drilling all moved have and not good can are but working about want we really So of as big we I its post guess to not low work, end don't Louisiana asset Obviously, -- Louisiana the intervention guidance talk you the well the about the high it or you factors kind swing was for maybe realizing see be kind to the the going end I the then might someone think as contract. well of else's. at of and intervention Phoenix West the existing just opportunities about

leading need of like pickup if intervention about maybe way type activity, on there assets we to should going seventh well well kind a that. and spread. a like versus nontraditional don't thinking intervention intervention I kind for like say, we're of a rate is do rig, not to -- So, spread Any be looks the but kind kind average not discount it know, contract realizing versus seems what that sixth-gen maybe in pricing a edge, of drilling drilling, that of it's versus, any

Simon Johnson

Greg. look, Yes. I No, understand what getting at, you're

I'd say market. the the what of rates are lower So, that heart deepwater the than is definitely

So, its I great it's mature of what becoming this in but that of be shallow job, conventional lot a is think strength like going it's to we where than a And to increasingly of for basins Louisiana DP get less from. sense, the a for important Gulf work drilling is Mexico. emanating part and water ability

configuration do we're to types think keen just that I key the in ability Louisiana can and into of of its was because work develop client drilling. X -- the case attractions anything switch to we whole are hoping So, Samir, to in paid and fact, capabilities one well And of bridge better of to intervention possibility. fee And conventional add? work for the unique between our that. the the this

Samir Ali

No. Yes.

And the new intervention pending Louisiana at we as resume is it into Simon that tested work. water can we as viewed right, getting doing hit out approval for depths. that think those low a it. it's point. a drilling while this work We said, do And well us, bridge well technology I we're the can as

we work shortly. So here more a will to transition profitable

Gregory Lewis

Super helpful. Thank you very much.

Operator

comes of from Kurt Hallead from the line Benchmark. question next Your

Kurt Hallead

everybody. morning, Good

the cost right, right? couple market same do solid up time. bring the So, outlook in, The I back referenced And some continue to kind Simon, idle to those very have of curious, kind was of assets go of demand. it you you in you is a play at -- dynamics of juncture, at have where favorable. assets, the with I'm

you look, that's have operating. limited my So, is, I guess availability question currently

last the to going sideline. customers as and you is? they seems hasn't there time that's how like really cost -- -- Do sense urgency talk tight have been might understand and do other What's high-cost market in understand sitting months, because much have the the be assets cycles. the how it your to sense when involved over we of just you few on seen You as

context So that. curious some you just us kind around of if could give

Simon Johnson

I mean, a despite continuously really is point, think spectators have interesting Yes. looking Kurt. the observation grounded market months always one I that's and of through views the been XX about consistent with back direction fears but and have No, higher, time. not the that on that's I momentum, rates last market with our expectations, the

been So, our of directionally, going. I we've the where think in correct estimation market is

that the there's than the ago. base, a required that the operating people is period certainty the that think rigs chunks capital space investor look complicated we're start think the in that I that think I there's years of as people be from period with we're we much bit we've are significant are. catch-up issue like on how of recoup expenditure to more for a going of think And risk costs there's and they a the the education to more time. me in commit to those come biggest and these past. what of understand to I to XX reactivating beast able visibility just an acceptable adjustment cost to without cost of large don't have when you -- more seen associated and definitely modern And about rigs, than back the rigs surveilling

the we're moment not at and is across a the but generally acting I speaking, rectitude. drillers, rationally. are a generally that thing think good people there's speaking, -- seeing great fiscal there's always, that

are -- the we're So, just has rigs in that know adamant projects of future, going whole a unless money we're not reactivated we shareholders' may but working have when got bunch rig be we're we we good a that those the future. about now, long-term that think pour currently operating into -- to our the

the I to think but Samir? to understand it. add, customers we're reluctant Anything So, pay for to going be that,

Samir Ali

capacity, them thing market I quite but that the up this little available active. I absorb is more hot to aware, going mean I'd just and that some still that's going in point. aren't really think come. reactivation It And It's think a have to a at to until only the are to step add you invest clients I No. time. clients to take you will capacity keenly in

Simon Johnson

mean, see improvement in about I Yes. of development market. consistent the very time. demand positive the we through remain We

Our of hydrocarbon lifting deepwater is clients. for high increasingly us profitability production telling that costs mix low customers important are part are extremely our the and is

it's and really we're starting macro good broaden demand a of the see base So, well. as story, to

So, these in market's great a headed direction. -- think we the

Kurt Hallead

I that great. color. That's appreciate Okay.

granular, guys Now services contracts maybe MPD right? getting and the a couple You little a including referenced and not on. base of rates new with so

of of one, how think we dollar value And should the per services? how So those program? dollar day the course about, MPD a number then frequently are services during deployed

Grant Creed

Yes.

pass to some certain the I'd depends the formation, But take question, and Marcel throughout on well, the say bit. don't. starting MPD to required So, with whole a wells start little on second then one that So it I'll right?

So, it really does vary.

think class our to part And $XX,XXX we MPD we getting announced, above which on $XX,XXX getting, for weight day of out contracts market. our And there. above the we're we're what most experience wells MPD between and we're of a terms punching more than that hitting done there we're with is In is -- we've MPD. just

premium let more prowess. little charge of a able it, we've a MPD our Marcel but for kind of about to So, elaborate kind been

Marcel Wieggers

Yes.

it depends little you're where area bit well. the a as operating So,

equipment. equipped over X will be operating in forward, Brazil going weeks So X MPD

we other MPD spread this Donavan in But summer, all well. out MPD Angola equipment. On a [ By XXX as the ] company, our XX side, and MPD well. we're drilling currently

give will a respect that which us experience, as huge in got competitive well. we've So a edge

Kurt Hallead

appreciate you. I Thank great. it. That's

Operator

question next Josh Jayne the line Energy Partners. from Your Daniel of from comes

Josh Jayne

about on talked fact one, the market? to First opportunities higher in just the just shortly for maybe that Louisiana. And curious, again work of touch drilling when do you moves are there term, on to priced But asset likely term about Mexico longer it that I'm intervention just this after you the I the on it know for piece. bit? think expand a -- after that think the you just intervention Gulf

Grant Creed

Sure.

I drilling is a think there's designed that potential. rig. She as

enough can. drilling So we'd that could we it. But have not for continue Louisiana sign the work up are we part. if its a is focus some that drilling There can get like vessel. to opportunities wells most by But term a with the is intervention they with usually for is if term be us, to pursue quicker. where going nature, to clients It intervention

Simon Johnson

part intervention that and And between P&A a of ability switch Gulf One the intervention strings. operators the been Josh, and compressing. portfolio as drilling in of that's X important handle between differential thing Most resources I the I days -- add, rig is conventional to has work lack becomes to these well operators' liabilities is Mexico, attractive. more the multiple would think the

So, particular something is range increasing spectrum as see terms in of a that -- the of the asset affordability terms Swiss knife, of the we believe of work. unit market. attractive. end progress -- army at the of be But that in plus we the capability of is broader specification lower ability to is a that opening have to a in to going an Louisiana of

Josh Jayne

one just maybe other And Okay. one.

maybe the couple are X on in Could a the market to that be helpful. in could but all talked bit for West if discussions, just outlook want You you detail mentioned would Samir just over maybe you next about where and of X to XXXX. work in more offer JV about Africa, years don't continue the rigs there touch you

Grant Creed

sure. Yes,

bit So, you're into and well. African pop the coast seeing as West candidly, a Africa up across little demand East

in some work is Nigeria. looking are openly there So, clients got programs. for active that We've

in that's Namibia up. starting to some got You've heat

You've got Angola.

So the market. pretty late feels African â€˜XX, good â€˜XX overall, in

Simon Johnson

Kurt, add, including that is in the activity, not JV in Angola. to footprint discoveries activity a would We've and Namibia. I lot seen adjacent geography really too, limited of important the some

supported So Namibia being companies drilling from out supporting Angola service a the of straight are are lot mobilizing directly operations of in those or that Angola.

just in strategically, Angola. pursuing joint that well those may we So think necessarily nearby, work be not that rigs in venture

Operator

of Your next Becker the question comes from Capital line of Doug One.

Doug Becker

end is duties the that's million from thinking shape really $XX the the in the does of recovery items expectations kind handled it guidance, import higher toward onetime out? been of how curious laid about of benefit range it, of Just

Simon Johnson

when of it's all, well, here. first think think we Doug, I about -- Grant

we things risks. various various of when and last opportunities we're at quarter this set think and reiterate I sort guidance and looking quarter,

we're this So, now a But pinpointing it it keep though. think top of direction reiterate it But reluctant considering And when I'm the mind yes, factors, is I but it. the obviously, materializes that towards we factor. bottom, a not it's say it guidance. pushes which of to we bunch quarter, in

Doug Becker

is expectations adjusted your it clarify, in included just for And EBITDA. to

Simon Johnson

It is, yes.

Doug Becker

more done. more. able And And maybe it. is year, report questions provide the the Maybe white there? There's thinking color work heading you for of we Gulf of Angola lots shorter-term rig about Louisiana. one Are should a once Got thinking be space about we're Mexico broadly, the then a when rig any just saying in to this mobilization? about

Grant Creed

markets marketing world. around in We're the all

of in Gulf the both you Absolutely. and potential? Could in markets, as markets the we So is Louisiana in stand We work work that see Mexico, for other well. see Absolutely. a

mobilization now. or contracts But that right could we marketing globally between just time asset Gulf space it I Mexico. could be that of be here are in say would So white the

Simon Johnson

in I with Louisiana think we of the that operators. people there's contract I clear. the got on record other and made track until the as both we for proud the mean think it that I the it's of surprising of about rig, opportunities the to opportunities plenty a upside. range many existing And Gulf, don't think has for understood

marketing says... So -- but as Samir we internationally are

Operator

Your the BWS from Khorsand comes Financial. next of line question Hamed from

Hamed Khorsand

question just first Africa. was my about So

market out, as for expectations? been talking been the for your lead the as good. like Where about you still worked looking where times far even Africa highly not it, -- has extended you're is is has the about You've developing market but though sounding still it's

Grant Creed

Yes.

-- things probably in I'd out where of is the say seen little So bit kind core place geographies, our Brazil. move we've we've a

demand of you've some bit of on that's the rig has into when to we slippage little in You've Candidly, a going benefit, not say that's But not seen that I'd moved tenders probably of that our a and there. if worked not probably seen a bit is market against us delay pushed they're have because into on availability. not But the the because or waiting like has schedules good favor shifted demand. are available. our just I'd demand the geology have to little actually reiterate, FPSOs other client right. has It's the their not is work got now that wellheads that's rigs items in our or that when

Hamed Khorsand

CEO how actually how in would commentary morning. changed would going this for as Seadrill it benefit given follow-up reason. has to on the Any not, it was that ownership... a that industry or the So be my Petrobras to different

Grant Creed

have and who impact, it's to I mean, got huge Yes. government for Brazil drilling supportive don't to out. that going building relatively you've a I a candidly. in continue hydrocarbons think wants

us. changes I for don't the day-to-day So, it really think

Operator

next of Touhy Parks question the from Noel from Brothers. comes Your line

Noel Parks

I couple had questions. of a

sort some there out, say if -- there the writing remark customers hasn't there point? optimistic You that it the some guess of this and and is ago are are unrealistically happened feels available customers that wondering, sort I a But like you're to on all still who little of capacity at formal seeing It clearly fair I'm about on while pricing hit the to availability see are still that out missing yet. full maybe who wall. is necessarily the the

Simon Johnson

let can we me Well, with then perhaps I can that, Samir. to start -- pass and

thing to great investing the is their necessarily are think in issue. discipline to return the rather I The shareholders back capital big it of showing visibility the in with to operators of gets market preferring the the terms than future business. moment the at

basis. constrained. but higher making very We on And shift CapEx to -- disciplined. being year-on-year decisions they But the definitely a are are is horizon seeing for relatively from

pockets white these there's whatever of with that. as like difficulty to result just seeing you're inevitably refer is from space time you the what and dislocations tight so, horizon availability or to And the that really air or resolving against the

So, that I persistent. be will think

way say. market. than and that's place would the together but lot think that of to visible not manage -- taking in are of I operators, the demand working rather the fixtures to they're are aren't full a to to work and sort speaking, public, seeing process that and of generally it, fall that together, preferring it's contractors I drilling There's a of lot

think I lot a there's of it's perfectly always cooperation not So, but collaboration, resolved.

Noel Parks

just just a but of just to have bonds interest stock. only are discipline, and a that, less know seen that especially can to to signs wondered Right, right. highly if in kind on have string the of And like of dividend capital expectation longer they of debt little M&A, looking leverage while. going that, price not to a expected. market see seem reality feel as road. I committed the for it the a And less would still cuts, that it later, to seems allergic than I seems different maybe also has of supportive be buybacks, the be I've sort and And high rate on been to from widespread is a don't check. of reasons tag it's if openly kind been it's this detect trend And I of to the some me to about that commit with their little -- with worried were fair the sooner customers still totally capital market a done if are among I been of say term, maybe operators been of sort for still rates any company yet. you seeing I down has a as But I in there particularly out operators guess, their there I bit the have midst or little

Grant Creed

starting bit. a to this clients You're are is overall, role looking drill. get still that's want hey, been a some it, but with the program FID say wouldn't little we're to go little is to But see program comfortable starting that's the we more clients at, I this see a

as always keeping it's U.S. in along balance right? short. same of that is versus the a our the every they've it in So We've years. happy months. locking been we're quite Mexico, happy and In every with going And with to rig with well fine recovering with right it for months. reprice of but reprice A relationship log us example it that. a mean to a that I good Gulf them because gives X XX allows able X it been flexibility, I think they're market,

are but detail. for much Thanks seeing little as it not Thank you. a the as you do Bye-bye. So bit, would we clients Great. think.

Operator

of Securities. Stene from your [Operator next Clarkson the Instructions] And question comes of line Fredrik

Fredrik Stene

you team, and hope well. Simon are

it last questions Q&A this in new short time. the in of think I a number for the XX is years I'll drilling. try of keep But here to A record. interest

bonus guidance, or can difference side the between EBITDA to give million help $XXX stuff your or on on is other there any elements, contracts to your First, that are related -- ability direction... in the get either and cost you $XXX million only that elements new can

Simon Johnson

Yes.

West a some But we're think to of is on projects chasing provide work, instead Polaris contracting toyed one and that, I just color was than fill-in in area just think bit so aware than obviously I the earlier of down Louisiana And service chosen focused contracts but derisk rig currently obviously you the Brazil. year. and cover of into projects, of I by risk if earlier rig the the the them the mean, people are West delivering the aware, perhaps those Phoenix. like. profile we've I around starting released schedule other on project end anticipated. can before some the anticipated. We're the with levers are laser We was on that the of and in the the undertaking the for preparation on keenly

we update anticipated as start At really, go moment, if as incur the start So than later, Brazil. obviously, and that's are surrounding ones. main and earlier in factor project forward delta mentioned we you we we remain move on another that's contract we'll rigs versus on preparation a those we today. that the well. overruns if schedule contract potential they think about X one. the year I on the But in we projects how It's and for on firmly cover

Fredrik Stene

Very helpful.

you've off XXXX. Second, discussed many rigs rolling you have, in as

now curious just rings, it And them about you I'm year? of trying this the stagger next? question what's short- to when guess case are for rolling those on my to than round that of mix just many relates think expect make sure rigs. You've what call already more whether re-contracting should you are some see those of purposefully right how and actively XXXX. certain contracts are of next the it's you not I to we somewhere also, staggered given to you again, in since, many And will the those re-contracting announced more even color contracts or long-term rigs off

Samir Ali

Yes.

you mentioned and want stagger create But smoother profile. more roll-off try on kind remarks, of things below as the the as portfolio to also a to well. is and day the a and them prepared top very of we're how Simon and his do contract focused the on that, improve surface So overall in of out absolutely kind terms, of rate we right, quality

getting right the the is pot, the it you if contracts, but So the rate sure also we of making all ensure our of terms the expiration is balance on us goes it a and into -- that contracts. for stagger we're a can it will. But right

Fredrik Stene

guidance, think to think, CapEx to also XX% will flow correct are timing guidance, include million, to year? be how that of capital that year. XX% of absolutely $XXX elements your to Is on would the have $XXX finally, both the it? the just clear, I incurred, from far be cash the about So rest you -- million end right? the And and to this that operations an you've Samir. Yes. way investments, plus so the Just for of compared

Samir Ali

That's [indiscernible]. right,

operations, million flow $XX $XX cash present the elements was cash million plus the from the maintenance on flows in to CapEx, which cost of which referring you're the how think I from statement we addition... is

Fredrik Stene

Yes.

Okay.

That's I sure Now day. I wanted have that All great for make to me. understood right. it correctly. just a

Operator

you call. question. Thank gentlemen, That was our final joining. Ladies for concludes that all today's and

disconnect. now may You

Seadrill Limited (SDRL) 15 May 242024 Q1 Earnings call transcript