Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): October 31, 2007
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): October 31, 2007
TRANSOCEAN INC.
(Exact name of registrant as specified in its charter)
| Cayman Islands | 333-75899 | 66-0582307 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
4 Greenway Plaza
Houston, Texas 77046
(Address of principal executive offices and zip code)
Registrant’s telephone number, including area code: (713) 232-7500
(Former name or former address, if changed since last report)
Houston, Texas 77046
(Address of principal executive offices and zip code)
Registrant’s telephone number, including area code: (713) 232-7500
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Table of Contents
ITEM 2.02 Results of Operations and Financial Condition.
Our press release dated October 31, 2007, concerning third quarter 2007 financial
results, furnished as Exhibit 99.1 to this report, is incorporated by reference herein. The press
release contains certain measures (discussed below) which may be deemed “non-GAAP financial
measures” as defined in Item 10 of Regulation S-K of the Securities Exchange Act of 1934, as
amended.
In the press release, we discuss field operating income for the three months ended June
30, 2007 and September 30, 2007. Management believes field operating income is a useful measure of
operating results since the measure only deducts expenses directly related to operations from
revenues. The most directly comparable GAAP financial measure, operating income before general and
administrative expenses, and information reconciling the GAAP and non-GAAP measures are included in
the press release.
ITEM 7.01 Regulation FD Disclosure.
On October 31, 2007, Transocean Inc. (the “Company”) is posting the slide presentation
furnished as Exhibit 99.2 to this report on the Company’s website at www.deepwater.com.
Exhibit 99.2 is incorporated in this Item 7.01 by reference.
The statements made herein that are not historical facts are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Forward-looking statements include, but are not limited to, statements
involving the Company’s Annual Effective Tax Rate, prospects for the Company, expected revenues, capital
expenditures, costs and results of operations, market outlook, revenue backlog for the Company and
other drillers, contract opportunities and commitments, operational performance, rig demand, rig
capacity, dayrates, rig reactivations, rig upgrades including upgrade projects for the Sedco
700-series semisubmersible rigs, newbuild and acquisition opportunities, fleet marketing efforts, rig mobilizations and planned
shipyard programs. Such statements are subject to numerous risks, uncertainties and assumptions,
including but not limited to, uncertainties relating to the level of activity in offshore oil and
gas exploration and development, exploration success by producers, oil and gas prices, rig demand
and capacity, drilling industry market conditions, possible delays or cancellation of drilling
contracts, work stoppages, operational or other downtime, the Company’s ability to enter into and
the terms of future contracts, the availability of qualified personnel, labor relations, future
financial results, operating hazards, political and other uncertainties inherent in non-U.S.
operations (including exchange and currency fluctuations), war, terrorism, natural disaster and
cancellation or unavailability of insurance coverage, the impact of governmental laws and
regulations, the adequacy of sources of liquidity, the effect of litigation and contingencies and
other factors discussed in the Company’s Form 10-K for the year ended December 31, 2006 and in the
Company’s other filings with the Securities and Exchange Commission (“SEC”), which are available
free of charge on the SEC’s website at www.sec.gov. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect, actual results may
vary materially from those indicated. You should not place undue reliance on forward-looking
statements. Each forward-looking statement speaks only as of the date of the particular statement,
and we undertake no obligation to publicly update or revise any forward-looking statements.
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The information furnished pursuant to Items 2.02 and 7.01 of this report, including
Exhibits 99.1 and 99.2, shall not be deemed to be “filed” for the purposes of Section 18 of the
Securities Exchange Act of 1934, nor will it be incorporated by reference into any registration
statement filed by Transocean Inc. under the Securities Act of 1933, as amended, unless
specifically identified therein as being incorporated therein by reference. The furnishing of the
information in this report is not intended to, and does not, constitute a determination or
admission by Transocean Inc. that the information in this report is material or complete, or that
investors should consider this information before making an investment decision with respect to any
security of Transocean Inc.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are furnished pursuant to Items 2.02 and 7.01:
| Exhibit Number | Description | |
99.1
|
Transocean Inc. Press Release Reporting Third Quarter 2007 Financial Results | |
99.2
|
Slide Presentation |
- 2 -
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
| TRANSOCEAN INC. | ||||||
Date: October 31, 2007
|
By: | /s/ Chipman Earle | ||||
| Chipman Earle | ||||||
| Associate General Counsel and Corporate Secretary | ||||||
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INDEX TO EXHIBITS
The following exhibits are furnished pursuant to Items 2.02 and 7.01:
| Exhibit Number | Description | |
99.1
|
Transocean Inc. Press Release Reporting Third Quarter 2007 Financial Results | |
99.2
|
Slide Presentation | |
- 4 -
Exhibit 99.1
| Transocean Inc. | ||
|
Post Office Box 2765 | |
| Houston TX 77252 2765 |
Analyst Contact:
|
Gregory S. Panagos | News Release | ||
| 713-232-7551 | FOR RELEASE: October 31, 2007 | |||
Media Contact:
|
Guy A. Cantwell | |||
| 713-232-7647 |
TRANSOCEAN INC. REPORTS
THIRD QUARTER 2007 FINANCIAL RESULTS
THIRD QUARTER 2007 FINANCIAL RESULTS
HOUSTON—Transocean Inc. (NYSE: RIG) today reported net income for the three months ended
September 30, 2007 of $973 million, or $3.24 per diluted share, on record quarterly revenues of
$1,538 million. The results compare to net income of $309 million, or $0.96 per diluted share,
on revenues of $1,025 million, for the three months ended September 30, 2006.
Third quarter 2007 results included after-tax income of $336 million, or $1.12 per diluted
share, related to $276 million for the TODCO tax sharing agreement, $52 million for changes in
estimated taxes, primarily foreign tax credits, and an $8 million gain resulting from the sale
of the drilling barge Searex VI. For the quarter ended September 30, 2006, net income included
$37 million, or $0.12 per diluted share, primarily from the sale of two tender-assist rigs.
For the nine months ended September 30, 2007, net income totaled $2,075 million, or $6.91
per diluted share, on revenues of $4,300 million. For the same period last year, net income
totaled $764 million, or $2.31 per diluted share, on revenues of $2,696 million. Results for
the first nine months of 2007 include $369 million, or $1.22 per diluted share, including $33
million recognized during the first half of 2007 from rig sales and discrete tax items plus the
$336 million recognized during the third quarter as noted above. For the nine months ended
September 30, 2006, net income included $191 million, or $0.57 per diluted share, primarily
from the sale of six rigs.
Operations Quarterly Review
Revenues for the three months ended September 30, 2007 increased 7.3 percent to $1,538
million compared to revenues of $1,434 million during the three months ended June 30, 2007.
The quarter-to-quarter increase in revenues was primarily due to a higher average dayrate,
partially offset by a slight reduction in days in service. The third quarter 2007 average
dayrate reached a record high of $219,700, up 8.5 percent, compared to $202,400 during the
second quarter 2007. The increase in average dayrate was experienced across all rig
categories, primarily as a result of rigs commencing new contracts at the higher prevailing
current dayrates.
For the three months ended September 30, 2007, operating income before general and
administrative expenses totaled $780 million, a 10.6 percent increase from $705 million
reported for the second quarter 2007. The $75 million increase in operating income before
general and administrative expense was due to higher revenues, driven by increased dayrates.
Partially offsetting the higher third quarter 2007 revenues was $36 million in increased
operating and maintenance expenses, primarily due to an increase in reimbursable costs and
integrated service expenditures, as well as an increase in the number of maintenance projects.
Field operating income(1) (defined as revenues less operating and maintenance
expenses) increased 8.4 percent to $875 million for the third quarter 2007, compared to $807
million for the prior three-month period. The increase in third quarter 2007 field operating income was due chiefly to strong revenue growth
combined with stable operating margins.
Liquidity
Cash flow from operations totaled $897 million for the third quarter 2007 compared to $289
million for the third quarter 2006. For the nine months ended September 30, 2007, cash flow
from operations increased to $2,158 million compared to $733 million for the same period last
year. As of September 30, 2007, total debt was $2,593 million, down $471 million compared to
$3,064 as of June 30, 2007. The $471 million of debt reduction during the third quarter 2007
reflects the repayment of the company’s two-year term credit facility due August 2008.
Effective Tax Rate
The company’s Annual Effective Tax Rate(2) for the three months ended September
30, 2007 was 14.0 percent, excluding various discrete items. The Effective Tax
Rate(3) of 5.1 percent for the third quarter 2007 reflects a $52 million favorable
impact resulting primarily from changes in estimated foreign tax credit. The company currently
expects the Annual Effective Tax Rate for the remainder of 2007 to be
14.6 percent.
Conference Call Information
Transocean will conduct a teleconference call at 10:00 a.m. Eastern Time on October 31,
2007. To participate, dial 913-981-5542 and refer to confirmation code 1852427 approximately
five to 10 minutes prior to the scheduled start time of the call.
In addition, the conference call will be simultaneously broadcast over the Internet in a
listen-only mode and can be accessed by logging onto the company’s website at www.deepwater.com
and selecting “Investor Relations/News & Events/Webcasts & Presentations.” A file containing
four charts to be discussed during the conference call, titled “3Q07 Charts,” has been posted
to the company’s website and can also be found by selecting “Investor Relations/News &
Events/Webcasts & Presentations.” The conference call may also be accessed via the Internet at
www.CompanyBoardroom.com by typing in the company’s New York Stock Exchange trading symbol,
“RIG.”
A telephonic replay of the conference call should be available after 1:00 p.m. Eastern
Time on October 31, 2007 and can be accessed by dialing 719-457-0820 and referring to the
passcode 1852427. Also, a replay will be available through the Internet and can be accessed by
visiting either of the above-referenced Worldwide Web addresses.
Forward-Looking Disclaimer
Statements regarding our Annual Effective Tax Rate, as well as any other statements that
are not historical facts in this release, are forward-looking statements that involve certain
risks, uncertainties and assumptions. These include but are not limited to operating hazards
and delays, risks associated with international operations, future financial results, actions
by customers and other third parties, factors affecting the supply and demand of drilling rigs,
including newbuilds, reactivations and the reallocation of current rigs, factors affecting the
duration of contracts including well-in-progress provisions, the actual amount of downtime,
factors resulting in reduced applicable dayrates, hurricanes and other weather conditions, the
future price of oil and gas and other factors detailed in the company’s most recent Form 10-K
and other filings with the Securities and Exchange Commission. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual
results may vary materially from those indicated.
Transocean Inc. is the world’s largest offshore drilling contractor with a fleet of 82
mobile offshore drilling units. The company’s mobile offshore drilling fleet, consisting of a
large number of high-specification deepwater and harsh environment drilling units, is
considered one of the most modern and versatile in the world due to its emphasis on technically
demanding segments of the offshore drilling business. The
company’s fleet consists of 34 High-Specification Floaters
(semisubmersibles and drillships), 19 Other Floaters, 25 Jackups
and other assets utilized in the support of offshore drilling activities worldwide. With a
current equity market capitalization $33.4 billion,
Transocean Inc.’s ordinary shares are traded on the New York Stock Exchange under the symbol “RIG.”
| (1) | For a reconciliation of operating income before general and administrative expense to field operating income, see the accompanying schedule entitled “Non-GAAP Financial Measures and Reconciliations — Operating Income Before General and Administrative Expense to Field Operating Income.” | |
| (2) | Annual Effective Tax Rate is defined as income tax expense excluding various discrete items (such as changes in estimates and tax on items excluded from income before income taxes) divided by income before income taxes excluding gains on sales and similar items pursuant to Financial Accounting Standards Board Interpretation No. 18. See the accompanying schedule entitled “Effective Tax Rate Analysis.” | |
| (3) | Effective Tax Rate is defined as income tax expense divided by income before income taxes. See the accompanying schedule entitled “Effective Tax Rate Analysis.” |
TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||
Operating revenues |
||||||||||||||||
Contract drilling revenues |
$ | 1,455 | $ | 991 | $ | 4,088 | $ | 2,598 | ||||||||
Other revenues |
83 | 34 | 212 | 98 | ||||||||||||
| 1,538 | 1,025 | 4,300 | 2,696 | |||||||||||||
Costs and expenses |
||||||||||||||||
Operating and maintenance |
663 | 561 | 1,858 | 1,585 | ||||||||||||
Depreciation |
103 | 99 | 304 | 303 | ||||||||||||
General and administrative |
27 | 22 | 82 | 67 | ||||||||||||
| 793 | 682 | 2,244 | 1,955 | |||||||||||||
Gain from disposal of assets, net |
8 | 47 | 30 | 222 | ||||||||||||
Operating income |
753 | 390 | 2,086 | 963 | ||||||||||||
Other income (expense), net |
||||||||||||||||
Interest income |
7 | 4 | 17 | 14 | ||||||||||||
Interest expense, net of amounts capitalized |
(23 | ) | (28 | ) | (93 | ) | (72 | ) | ||||||||
Other, net |
287 | 7 | 295 | 9 | ||||||||||||
| 271 | (17 | ) | 219 | (49 | ) | |||||||||||
Income before income taxes and minority interest |
1,024 | 373 | 2,305 | 914 | ||||||||||||
Income tax expense |
52 | 64 | 230 | 150 | ||||||||||||
Minority interest |
(1 | ) | — | — | — | |||||||||||
Net income |
$ | 973 | $ | 309 | $ | 2,075 | $ | 764 | ||||||||
Earnings per share |
||||||||||||||||
Basic |
$ | 3.36 | $ | 0.99 | $ | 7.17 | $ | 2.39 | ||||||||
Diluted |
$ | 3.24 | $ | 0.96 | $ | 6.91 | $ | 2.31 | ||||||||
Weighted average shares outstanding |
||||||||||||||||
Basic |
290 | 312 | 289 | 320 | ||||||||||||
Diluted |
300 | 323 | 301 | 332 | ||||||||||||
TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share data)
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share data)
| September 30, | December 31, | |||||||
| 2007 | 2006 | |||||||
| (Unaudited) | ||||||||
| ASSETS |
||||||||
Cash and cash equivalents |
$ | 618 | $ | 467 | ||||
Accounts receivable, net of allowance for doubtful accounts of $41
and $26 at September 30, 2007 and December 31, 2006, respectively |
1,266 | 946 | ||||||
Materials and supplies, net of allowance for obsolescence of $21 and $19
at September 30, 2007 and December 31, 2006, respectively |
179 | 160 | ||||||
Deferred income taxes, net |
28 | 16 | ||||||
Other current assets |
132 | 67 | ||||||
Total current assets |
2,223 | 1,656 | ||||||
Property and equipment |
11,460 | 10,539 | ||||||
Less accumulated depreciation |
3,489 | 3,213 | ||||||
Property and equipment, net |
7,971 | 7,326 | ||||||
Goodwill |
2,187 | 2,195 | ||||||
Other assets |
319 | 299 | ||||||
Total assets |
$ | 12,700 | $ | 11,476 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||
Accounts payable |
$ | 406 | $ | 477 | ||||
Accrued income taxes |
156 | 98 | ||||||
Debt due within one year |
1,018 | 95 | ||||||
Other current liabilities |
419 | 369 | ||||||
Total current liabilities |
1,999 | 1,039 | ||||||
Long-term debt |
1,575 | 3,200 | ||||||
Deferred income taxes, net |
57 | 54 | ||||||
Other long-term liabilities |
566 | 343 | ||||||
Total long-term liabilities |
2,198 | 3,597 | ||||||
Commitments and contingencies |
||||||||
Minority interest |
1 | 4 | ||||||
Preference shares, $0.10 par value; 50,000,000 shares authorized,
none issued and outstanding |
— | — | ||||||
Ordinary shares, $0.01 par value; 800,000,000 shares authorized,
290,802,699 and 292,454,457 shares issued and outstanding
at September 30, 2007 and December 31, 2006, respectively |
3 | 3 | ||||||
Additional paid-in capital |
7,780 | 8,044 | ||||||
Accumulated other comprehensive loss |
(31 | ) | (30 | ) | ||||
Retained earnings (accumulated deficit) |
750 | (1,181 | ) | |||||
Total shareholders’ equity |
8,502 | 6,836 | ||||||
Total liabilities and shareholders’ equity |
$ | 12,700 | $ | 11,476 | ||||
TRANSOCEAN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||
Cash flows from operating activities |
||||||||||||||||
Net income |
$ | 973 | $ | 309 | $ | 2,075 | $ | 764 | ||||||||
Adjustments to reconcile net income to net cash
provided by operating activities |
||||||||||||||||
Depreciation |
103 | 99 | 304 | 303 | ||||||||||||
Share-based compensation expense |
11 | 5 | 30 | 13 | ||||||||||||
Gain from disposal of assets, net |
(8 | ) | (47 | ) | (30 | ) | (222 | ) | ||||||||
Deferred income taxes |
9 | (7 | ) | 2 | 18 | |||||||||||
Deferred expenses, net |
(4 | ) | (40 | ) | (17 | ) | (95 | ) | ||||||||
Deferred revenues, net |
(20 | ) | 12 | 18 | 32 | |||||||||||
Other long-term liabilities |
19 | (4 | ) | 31 | 17 | |||||||||||
Other, net |
(7 | ) | (7 | ) | (3 | ) | (14 | ) | ||||||||
Changes in operating assets and liabilities |
||||||||||||||||
Accounts receivable |
(82 | ) | (169 | ) | (320 | ) | (273 | ) | ||||||||
Other current assets |
3 | 15 | (29 | ) | (36 | ) | ||||||||||
Accounts payable and other current liabilities |
(75 | ) | 76 | 65 | 167 | |||||||||||
Income taxes receivable/payable, net |
(25 | ) | 47 | 32 | 59 | |||||||||||
Net cash provided by operating activities |
897 | 289 | 2,158 | 733 | ||||||||||||
Cash flows from investing activities |
||||||||||||||||
Capital expenditures |
(305 | ) | (434 | ) | (1,060 | ) | (710 | ) | ||||||||
Proceeds from disposal of assets, net |
21 | 95 | 62 | 298 | ||||||||||||
Joint ventures and other investments, net |
— | — | (3 | ) | — | |||||||||||
Net cash used in investing activities |
(284 | ) | (339 | ) | (1,001 | ) | (412 | ) | ||||||||
Cash flows from financing activities |
||||||||||||||||
Borrowings under the Revolving Credit Facility,
net |
— | 900 | — | 900 | ||||||||||||
Proceeds from issuance of debt, net |
— | 1,000 | — | 1,000 | ||||||||||||
Repayment of borrowings under Term Credit Facility |
(470 | ) | — | (700 | ) | — | ||||||||||
Release of escrow funds – Nautilus lease financing |
— | 30 | — | 30 | ||||||||||||
Repurchase of ordinary shares |
— | (1,751 | ) | (400 | ) | (2,351 | ) | |||||||||
Proceeds from issuance of ordinary shares under
share-based compensation plans, net |
1 | 1 | 56 | 67 | ||||||||||||
Tax benefit from issuance of ordinary shares
under share-based compensation plans |
23 | — | 33 | — | ||||||||||||
Other, net |
6 | (5 | ) | 5 | (5 | ) | ||||||||||
Net cash provided by (used in) financing activities |
(440 | ) | 175 | (1,006 | ) | (359 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents |
173 | 125 | 151 | (38 | ) | |||||||||||
Cash and cash equivalents at beginning of period |
445 | 282 | 467 | 445 | ||||||||||||
Cash and cash equivalents at end of period |
$ | 618 | $ | 407 | $ | 618 | $ | 407 | ||||||||
Transocean Inc.
Fleet Operating Statistics
Fleet Operating Statistics
| Operating Revenues (in millions) (1) | ||||||||||||||||||||
| Nine months ended | ||||||||||||||||||||
| Three months ended | Sept 30, | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Contract Drilling Revenues |
||||||||||||||||||||
High-Specification Floaters: |
||||||||||||||||||||
Ultra Deepwater Floaters |
$ | 381 | $ | 336 | $ | 257 | $ | 1,057 | $ | 711 | ||||||||||
Other Deepwater Floaters |
298 | 272 | 246 | 830 | 611 | |||||||||||||||
Other High-Specification Floaters |
101 | 103 | 62 | 290 | 176 | |||||||||||||||
Total High-Specification Floaters |
780 | 711 | 565 | 2,177 | 1,498 | |||||||||||||||
Other Floaters |
412 | 403 | 218 | 1,193 | 551 | |||||||||||||||
Jackups |
248 | 230 | 184 | 673 | 483 | |||||||||||||||
Other Rigs |
15 | 16 | 24 | 45 | 66 | |||||||||||||||
Subtotal |
1,455 | 1,360 | 991 | 4,088 | 2,598 | |||||||||||||||
Other Revenues |
||||||||||||||||||||
Client Reimbursable Revenues |
32 | 29 | 30 | 92 | 77 | |||||||||||||||
Integrated Services and Other |
51 | 45 | 4 | 120 | 21 | |||||||||||||||
Subtotal |
83 | 74 | 34 | 212 | 98 | |||||||||||||||
Total Company |
$ | 1,538 | $ | 1,434 | $ | 1,025 | $ | 4,300 | $ | 2,696 | ||||||||||
| Average Dayrates (1) | ||||||||||||||||||||
| Nine months ended | ||||||||||||||||||||
| Three months ended | Sept 30, | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
High-Specification Floaters: |
||||||||||||||||||||
Ultra Deepwater Floaters |
$ | 323,200 | $ | 288,900 | $ | 246,000 | $ | 304,600 | $ | 223,700 | ||||||||||
Other Deepwater Floaters |
$ | 257,700 | $ | 228,400 | $ | 222,300 | $ | 240,600 | $ | 188,700 | ||||||||||
Other High-Specification Floaters |
$ | 316,400 | $ | 286,900 | $ | 181,500 | $ | 279,500 | $ | 172,000 | ||||||||||
Total High-Specification Floaters |
$ | 293,900 | $ | 262,100 | $ | 226,700 | $ | 273,600 | $ | 201,400 | ||||||||||
Other Floaters |
$ | 251,400 | $ | 226,300 | $ | 136,800 | $ | 233,500 | $ | 122,000 | ||||||||||
Jackups |
$ | 120,500 | $ | 117,900 | $ | 83,400 | $ | 114,600 | $ | 75,800 | ||||||||||
Other Rigs |
$ | 54,900 | $ | 57,200 | $ | 52,400 | $ | 54,100 | $ | 49,100 | ||||||||||
Total Drilling Fleet |
$ | 219,700 | $ | 202,400 | $ | 146,900 | $ | 206,800 | $ | 132,000 | ||||||||||
| Utilization (1) | ||||||||||||||||||||
| Nine months ended | ||||||||||||||||||||
| Three months ended | Sept 30, | |||||||||||||||||||
| September 30, | June 30, | September 30, | ||||||||||||||||||
| 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
High-Specification Floaters: |
||||||||||||||||||||
Ultra Deepwater Floaters |
99 | % | 98 | % | 88 | % | 98 | % | 90 | % | ||||||||||
Other Deepwater Floaters |
79 | % | 82 | % | 75 | % | 79 | % | 75 | % | ||||||||||
Other High-Specification Floaters |
87 | % | 99 | % | 93 | % | 95 | % | 94 | % | ||||||||||
Total High-Specification Floaters |
87 | % | 90 | % | 82 | % | 88 | % | 83 | % | ||||||||||
Other Floaters |
89 | % | 98 | % | 86 | % | 94 | % | 78 | % | ||||||||||
Jackups |
90 | % | 86 | % | 96 | % | 86 | % | 93 | % | ||||||||||
Other Rigs |
98 | % | 100 | % | 76 | % | 99 | % | 64 | % | ||||||||||
Total Drilling Fleet |
89 | % | 91 | % | 87 | % | 89 | % | 83 | % | ||||||||||
| (1) | Average daily revenue is defined as contract drilling revenue earned per revenue earning day in the period. A revenue earning day is defined as a day for which a rig earns dayrate after commencement of operations. Utilization is defined as the total actual number of revenue earning days in the period as a percentage of the total number of calendar days in the period for all drilling rigs in our fleet. |
Transocean Inc. and Subsidiaries
Non-GAAP Financial Measures and Reconciliations
Non-GAAP Financial Measures and Reconciliations
Operating Income Before General and Administrative Expense
to Field Operating Income
(in millions)
to Field Operating Income
(in millions)
| Three months ended | Nine months ended | |||||||||||||||||||
| Sept 30, | June 30, | Sept 30, | Sept 30, | Sept 30, | ||||||||||||||||
| 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||
Operating revenue |
$ | 1,538 | $ | 1,434 | $ | 1,025 | $ | 4,300 | $ | 2,696 | ||||||||||
Operating and maintenance expense |
663 | 627 | 561 | 1,858 | 1,585 | |||||||||||||||
Depreciation |
103 | 101 | 99 | 304 | 303 | |||||||||||||||
(Gain) loss from disposal of assets, net |
(8 | ) | 1 | (47 | ) | (30 | ) | (222 | ) | |||||||||||
Operating income before general and
administrative expense |
780 | 705 | 412 | 2,168 | 1,030 | |||||||||||||||
Add back (subtract): Depreciation |
103 | 101 | 99 | 304 | 303 | |||||||||||||||
(Gain) loss from
disposal of assets,
net |
(8 | ) | 1 | (47 | ) | (30 | ) | (222 | ) | |||||||||||
Field operating income |
$ | 875 | $ | 807 | $ | 464 | $ | 2,442 | $ | 1,111 | ||||||||||
Transocean Inc. and Subsidiaries
Effective Tax Rate Analysis
(In millions)
Effective Tax Rate Analysis
(In millions)
| Three months ended | Nine months ended | Twelve months ended | ||||||||||||||||||||||
| September 30, | June 30, | September 30, | September 30, | Dec. 31 | ||||||||||||||||||||
| 2007 | 2007 | 2006 | 2007 | 2006 | 2006 | |||||||||||||||||||
Income (Loss) before income taxes and
minority interest |
$ | 1,024 | $ | 643 | $ | 373 | $ | 2,305 | $ | 914 | $ | 1,607 | ||||||||||||
Add back (subtract): |
$ | — | $ | — | ||||||||||||||||||||
(Gain) loss on disposal of assets, net |
(9 | ) | 1 | (44 | ) | (31 | ) | (219 | ) | (410 | ) | |||||||||||||
Income from TODCO tax sharing
agreement |
(276 | ) | — | — | (276 | ) | — | (51 | ) | |||||||||||||||
Adjusted income before income taxes |
$ | 739 | $ | 644 | $ | 329 | $ | 1,998 | $ | 695 | $ | 1,146 | ||||||||||||
Income tax expense |
$ | 52 | $ | 93 | $ | 64 | $ | 230 | $ | 150 | $ | 222 | ||||||||||||
Add back (subtract): |
||||||||||||||||||||||||
(Gain) loss on disposal of assets, net |
— | — | (3 | ) | (3 | ) | (25 | ) | (24 | ) | ||||||||||||||
Changes in estimates (1) |
52 | 11 | (4 | ) | 65 | (3 | ) | 14 | ||||||||||||||||
Adjusted income tax expense (2) |
$ | 104 | $ | 104 | $ | 57 | $ | 292 | $ | 122 | $ | 212 | ||||||||||||
Effective tax rate (3) |
5.1 | % | 14.4 | % | 17.1 | % | 10.0 | % | 16.4 | % | 13.8 | % | ||||||||||||
Annual effective tax rate (4) |
14.0 | % | 16.1 | % | 17.3 | % | 14.6 | % | 17.5 | % | 18.5 | % | ||||||||||||
| (1) | Our estimates change as we file tax returns, settle disputes with tax authorities or become aware of other events and include changes in deferred taxes, valuation allowances on deferred taxes and other tax liabilities. | |
| (2) | The three months ended September 30, 2007 include $(4) million of additional tax expense (benefit) reflecting the catch-up effect of an increase (decrease) in the annual effective tax rate. | |
| (3) | Effective Tax Rate is income tax expense divided by income before income taxes. | |
| (4) | Annual Effective Tax Rate is income tax expense excluding various discrete items (such as changes in estimates and tax on items excluded from income before income taxes) divided by income before income taxes excluding gains on sales and similar items pursuant to Financial Accounting Standards Board Interpretation No. 18. |
Exhibit 99.2
| Transocean Inc. Reports Third Quarter 2007 Results |
| Chart #1: Average Contracted Dayrate by Rig Type Qtr 4 2007 through Qtr 4 2008 (Unaudited) Definitions Average Dayrate The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted aver age contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. The weighted average contract dayrate for each rig type based on current backlog from the company's most recent Fleet Status Update Report as of October 30th, 2007. Includes firm contracts only. High-Specification Floaters The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other H igh-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. The High-Specification Floaters category is a consolidation of the Ultra-Deepwater Floaters, Other High-Specification Floaters and Other Deepwater Floaters as described below. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Ultra-Deepwater Floaters have high-pressure mud pumps and a water depth capability of 7,500 feet or greater. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics . Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. Other High-Specification Floaters were built in the in the mid to late 1980s, are capable of drilling in harsh environments and have greater displacement than previously constructed rigs resulting in larger variable load capacity, more useable deck space and better motion characteristics. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4, 500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. The Other Deepwater Floaters include the remaining semi-submersible rigs and drillships that have a water depth capacity of at least 4,500 feet. Other Floaters The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less th an 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. The Other Floaters category is generally comprised of those non-High-Specification Floaters with a water depth capacity of less than 4,500 feet. Jackups The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. The Jackups category consists of our jackup fleet. |
| Chart #2: Out-of-Service Rig Months Qtr 1 2007 through Qtr 4 2008 (Unaudited) Definitions Rig Months Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Time expressed in months that each rig has been, or is forecast to be Out of Service as reflected in the company's Fleet Status Update Report as of October 30th, 2007. Also includes out of service time of less than 14 days that is not disclosed in the Fleet Status report. Out-of-Service Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrade s. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Time when a rig is not available to earn an operating dayrate due to shipyards, contract preparation, mobilization, reactivation or upgrades. Mobilization Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods cover ed in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Includes mobilization and demobilization to and from operating contracts and other activities such as shipyards excluding those mobilization and demobilization periods covered in Reactivation and Upgrades. Reactivation Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Rig time described as "reactivation", relating to the C.K. Rhein Jr., which was previously cold stacked. Upgrade Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are u ndergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Rig time described as "upgrade" includes the Sedco 702 and Sedco 706 which are undergoing or forecast to undergo a shipyard project to enhance the operational capabilities of the rig. Shipyard Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. Rig time described as "shipyard" refers to periods during which a rig is out of service as a result of other planned shipyards, surveys, repairs, regulatory inspections or other planned service or work on the rig excluding reactivations and upgrades. |
| Chart #3: Operating & Maintenance (O&M) Costs Trends (Unaudited) Definitions Support & Integrated Services Includes Integrated Services, all shorebase or common support costs (on-shore offices, yards, pool equipment). Operating Rigs Denotes the total O&M costs of a rig while in service based upon the Rig Operating Days (excluding shorebase or common support costs), as defined below. Rig Operating Days Denotes the total amount of days a rig is deemed to be in-service under contract operations. This excludes all out of service time relating to shipyards, mobilization and short-term out of contract periods but includes the operational downtime of in service rigs. The average number of days may also fluctuate from quarter to quarter as a result of rigs being reactivated, sold or stacked in the quarters. Out of Service Denotes the total O&M costs while a rig is out of service based upon Out of Service Days, as defined below. Out of Service costs are the difference between total operating and maintenance costs and the In-Service Costs. Out of Service Days Includes the total amount of days a rig is deemed to be out of service. This relates to times when a rig is out of service due to shipyards, mobilization and short-term idle periods. O&M Costs * Our operating and maintenance costs represent all direct and indirect costs associated with the operation and maintenance of our drilling rigs. Operating and maintenance costs also includes all costs related to local and regional offices as well as all costs related to operations support, engineering support, marketing and other similar costs. The principal elements of these costs are direct and indirect labor and benefits, repair and maintenance, contract preparation expenses, insurance, boat and helicopter rentals, professional and technical fees, freight costs, communications, customs duties, tool rentals and services, fuel and water, general taxes and licenses. Labor, repair and maintenance costs, insurance premiums, personal injury losses and drilling rig casualty losses represent the most significant components of our operating and maintenance costs |
| Chart #4: Contract Backlog by Years (Unaudited) Total Contract Backlog (1) = $22.9 Billion |