DALLAS--(BUSINESS WIRE)--Feb. 26, 2008--ENSCO International
Incorporated (NYSE: ESV) reported net income increased by 13% in the
quarter ended December 31, 2007, to $238.6 million ($1.66 per diluted
share) on revenues of $529.2 million, as compared to net income of
$210.4 million ($1.39 per diluted share) on revenues of $470.6 million
for the quarter ended December 31, 2006.
Net income for the year ended December 31, 2007, was $992.0
million ($6.73 per diluted share) on revenues of $2,143.8 million,
compared to net income of $769.7 million ($5.04 per diluted share) on
revenues of $1,813.5 million for the year ended December 31, 2006.
The average day rate for ENSCO's jackup rig fleet for the quarter
ended December 31, 2007, increased by 21% to $140,900, as compared to
$116,400 in the prior year quarter. Utilization of the Company's
jackup fleet was 89% in the fourth quarter of 2007 compared to 96% in
the fourth quarter of 2006. The lower fourth quarter 2007 utilization
rate primarily was due to reduced activity for the Company's Gulf of
Mexico jackup rigs and downtime attributable to the relocation of a
jackup rig to the North Sea from West Africa.
During the fourth quarter of 2007, the Company repurchased 1.9
million shares of its common stock at a total cost of $104.1 million,
or an average price of $55.38 per share. Since inception of the stock
repurchase program in March 2006, ENSCO has repurchased 12.8 million
shares of common stock at a cost of $681.6 million, or an average
price of $53.05 per share. As of December 31, 2007, the Company had
$318.4 million remaining under its current stock repurchase
authorization.
Dan Rabun, Chairman, President and Chief Executive Officer,
commented on the Company's results and outlook: "2007 was a record
year for ENSCO in several respects. Most importantly, we have always
had a commitment to safety and I am pleased that 2007 was the safest
year in our history. I would like to commend all of our personnel for
their contributions to a safer workplace. In 2008, we are undertaking
a number of new initiatives to further our commitment to safety as we
strive to achieve a zero-incident workplace.
"I am pleased to report that net income reached a record level in
2007, increasing 29% year-over-year to just under $1.0 billion.
Earnings per share increased by an even greater percentage, 34%, as we
continued to reduce shares outstanding through stock repurchases.
"Our contract backlog also grew during the year, increasing to
$3.9 billion in early 2008, from $3.2 billion in early 2007.
Thirty-seven percent of our current backlog is attributable to our
deepwater fleet.
"We are making good progress on our deepwater rig fleet expansion.
The naming ceremony for ENSCO 8500, the first of our four 8500 Series
ultra-deepwater semisubmersible rigs under construction in Singapore,
is scheduled for May 17, 2008. The rig is expected to commence
drilling operations in the U.S. Gulf of Mexico by late 2008 following
completion of commissioning, mobilization and final outfitting. The
other three ENSCO 8500 Series(R) rigs are scheduled for delivery in
Singapore in the first and fourth quarters of 2009 (ENSCO 8501 and
ENSCO 8502) and in the third quarter of 2010 (ENSCO 8503), with all
but ENSCO 8503 now under multi-year drilling contracts.
"Since our jackup fleet enhancement program is largely completed,
we expect to dramatically reduce shipyard days in 2008. We estimate
that we will incur approximately 60 shipyard days in 2008 related to
jackup rig enhancement projects, a significant decrease from the 442
and 491 shipyard days incurred in 2007 and 2006, respectively. The
estimated 60 shipyard days in 2008 relate to the upgrade of ENSCO 93,
one of our Gulf of Mexico jackup rigs that is expected to return to
service shortly.
"Looking forward to the remainder of 2008, we expect to see a more
meaningful contribution from our deepwater fleet and stronger
financial performance from our jackup rigs. In deepwater, we recently
rolled to a significantly higher day rate on ENSCO 7500 and we expect
ENSCO 8500 to begin operations late this year. We already have
contracted approximately 85% of our international jackup rig days for
2008, and we are seeing some improvement in the U.S. Gulf of Mexico
jackup market. These factors give us confidence that 2008 will be
another record year for ENSCO."
Statements contained in this news release that state the Company's
or management's intentions, hopes, beliefs, expectations,
anticipations, projections, confidence, schedules, or predictions of
the future are forward-looking statements made pursuant to the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements include references to future earnings and financial
performance expectations, trends in day rates, utilization or rig
relocations, future rig rates or utilization, rig enhancement,
shipyard work completion, and contract commitments, the period of time
and number of rigs that will be in a shipyard, scheduled delivery
dates for new rigs, scheduled commencement dates for new contracts,
rig relocations, market trends, expectations, outlook, projections or
conditions for 2008 and beyond. It is important to note that our
actual results could differ materially from those projected in such
forward-looking statements. The factors that could cause actual
results to differ materially from those in the forward-looking
statements include the following: (i) industry conditions and
competition, including changes in rig supply and demand or new
technology, (ii) cyclical nature of the industry, (iii) worldwide
expenditures for oil and gas drilling, (iv) operational risks,
including hazards created by severe storms and hurricanes, (v) risks
associated with offshore rig operations or, rig relocations in
general, and in foreign jurisdictions in particular, (vi)
renegotiation, nullification, or breach of contracts with customers or
other parties, (vii) changes in the dates our rigs undergoing shipyard
construction work, repairs or enhancement will enter a shipyard, be
delivered, return to or enter service, (viii) changes in the dates new
contracts actually commence, (ix) risks inherent to domestic and
foreign shipyard rig construction, rig repair or rig enhancement,
including unexpected delays in equipment delivery and engineering or
design issues following shipyard delivery, (x) unavailability of
transport vessels to relocate rigs, (xi) environmental or other
liabilities, risks, or losses including hurricane related equipment
damage, loss or wreckage or debris removal in the U.S. Gulf of Mexico,
that may arise in the future which are not covered by insurance or
indemnity in whole or in part, (xii) the impact of current and future
laws and government regulation affecting the oil and gas industry in
general or our operations in particular, including taxation as well as
repeal or modification of same, (xiii) political and economic
uncertainty, (xiv) limited availability of economic insurance coverage
for certain perils such as hurricanes in the Gulf of Mexico or removal
of wreckage or debris, (xv) self-imposed or regulatory limitations on
jackup rig drilling locations in the Gulf of Mexico during hurricane
season, (xvi) our availability to attract and retain skilled or other
personnel, (xvii) excess rig availability or supply resulting from
delivery of new drilling units, (xviii) heavy concentration of our rig
fleet in premium jackups, (xix) terrorism or military action impacting
our operations or financial performance, (xx) the outcome of
litigation, legal procedures, investigations or claims, and (xxi)
other risks as described from time to time as Risk Factors and
otherwise in the Company's SEC filings. Copies of such SEC filings may
be obtained at no charge by contacting our investor relations
department at 214-397-3045 or by referring to the investor relations
section of our website at http://www.enscous.com.
All information in this press release is as of February 26, 2008.
The Company undertakes no duty to update any forward-looking
statement, to conform the statement to actual results, or reflect
changes in the Company's expectations.
ENSCO, headquartered in Dallas, Texas, provides contract drilling
services to the global petroleum industry.
ENSCO will conduct a conference call at 10:00 a.m. Central Time on
Tuesday, February 26, 2008, to discuss its fourth quarter and full
year 2007 results. The call will be broadcast live over the Internet
at www.enscous.com. Interested parties also may listen to the call by
dialing (719) 325-4783. We recommend that participants call five to
ten minutes before the scheduled start time.
A replay of the conference call will be available by phone for 48
hours after the call by dialing (719) 457-0820 (access code 3366164).
A transcript of the call and access to a replay or MP3 download can be
found on-line on the ENSCO web site www.enscous.com in the Investors
Section.
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(In millions, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2007 2006 2007 2006
-------- -------- --------- ---------
OPERATING REVENUES $ 529.2 $ 470.6 $2,143.8 $1,813.5
OPERATING EXPENSES
Contract drilling 173.8 151.9 684.1 576.7
Depreciation 45.3 44.6 184.3 175.0
General and administrative 12.9 12.4 59.5 44.6
-------- -------- --------- ---------
232.0 208.9 927.9 796.3
-------- -------- --------- ---------
OPERATING INCOME 297.2 261.7 1,215.9 1,017.2
OTHER INCOME (EXPENSE)
Interest income 6.7 5.6 26.3 14.9
Interest expense, net - (2.9) (1.9) (16.5)
Other, net 3.9 (1.0) 13.4 (4.3)
-------- -------- --------- ---------
10.6 1.7 37.8 (5.9)
-------- -------- --------- ---------
INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME
TAXES 307.8 263.4 1,253.7 1,011.3
PROVISION FOR INCOME TAXES 69.2 57.7 261.7 252.7
-------- -------- --------- ---------
INCOME FROM CONTINUING
OPERATIONS 238.6 205.7 992.0 758.6
DISCONTINUED OPERATIONS, NET - 4.7 - 10.5
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE, NET - - - 0.6
-------- -------- --------- ---------
NET INCOME $ 238.6 $ 210.4 $ 992.0 $ 769.7
======== ======== ========= =========
EARNINGS PER SHARE - BASIC
Continuing operations $ 1.66 $ 1.36 $ 6.76 $ 4.98
Discontinued operations - 0.03 - 0.07
Cumulative effect of
accounting change - - - -
-------- -------- --------- ---------
$ 1.66 $ 1.39 $ 6.76 $ 5.06
======== ======== ========= =========
EARNINGS PER SHARE - DILUTED
Continuing operations $ 1.66 $ 1.36 $ 6.73 $ 4.96
Discontinued operations - 0.03 - 0.07
Cumulative effect of
accounting change - - - -
-------- -------- --------- ---------
$ 1.66 $ 1.39 $ 6.73 $ 5.04
======== ======== ========= =========
AVERAGE COMMON SHARES
OUTSTANDING
Basic 143.4 151.0 146.7 152.2
Diluted 144.0 151.8 147.3 152.8
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEET
(In millions)
December 31, December 31,
2007 2006
------------ ------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 629.5 $ 565.8
Accounts receivable, net 383.2 338.8
Other 116.6 82.6
------------ ------------
Total current assets 1,129.3 987.2
PROPERTY AND EQUIPMENT, NET 3,358.9 2,960.4
GOODWILL 336.2 336.2
OTHER ASSETS, NET 144.4 50.6
------------ ------------
$ 4,968.8 $ 4,334.4
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 484.4 $ 217.8
Current maturities of long-term debt 19.1 167.1
------------ ------------
Total current liabilities 503.5 384.9
LONG-TERM DEBT 291.4 308.5
DEFERRED INCOME TAXES 352.0 356.5
OTHER LIABILITIES 69.9 68.5
STOCKHOLDERS' EQUITY 3,752.0 3,216.0
------------ ------------
$ 4,968.8 $ 4,334.4
============ ============
ENSCO INTERNATIONAL INCORPORATED
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Twelve Months Ended
December 31,
--------------------
2007 2006
--------- ---------
OPERATING ACTIVITIES
Net income $ 992.0 $ 769.7
Adjustments to reconcile net income to net cash
provided by operating activities of continuing
operations:
Depreciation 184.3 175.0
Changes in working capital and other 65.7 (0.9)
--------- ---------
Net cash provided by operating activities
of continuing operations 1,242.0 943.8
--------- ---------
INVESTING ACTIVITIES
Additions to property and equipment (519.9) (528.6)
Other 7.7 26.6
--------- ---------
Net cash used in investing activities (512.2) (502.0)
--------- ---------
FINANCING ACTIVITIES
Reduction of long-term borrowings (167.2) (17.1)
Repurchase of common stock (521.6) (160.0)
Cash dividends paid (14.8) (15.3)
Proceeds from exercise of stock options 35.8 41.8
Other 2.5 2.6
--------- ---------
Net cash used in financing activities (665.3) (148.0)
--------- ---------
Effect of exchange rate fluctuations on cash and
cash equivalents (0.8) (0.2)
Net cash provided by operating activities of
discontinued operations - 3.7
--------- ---------
INCREASE IN CASH AND CASH EQUIVALENTS 63.7 297.3
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 565.8 268.5
--------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 629.5 $ 565.8
========= =========
ENSCO INTERNATIONAL INCORPORATED
OPERATING STATISTICS
Third
Fourth Quarter Quarter
----------------------
2007 2006 2007
---------- ---------- ----------
Contract drilling
----------------------------------
Average day rates
Jackup rigs
Asia Pacific $ 136,768 $ 96,503 $ 132,876
Europe / Africa 212,844 158,551 203,117
North and South America 88,586 114,132 112,643
---------- ---------- ----------
Total jackup rigs 140,851 116,358 143,199
Semisubmersible rig - N.
America 201,008 195,292 200,716
Barge rig - Asia Pacific 72,997 57,500 71,496
---------- ---------- ----------
Total $ 140,755 $ 116,780 $ 142,821
========== ========== ==========
Utilization
Jackup rigs
Asia Pacific 99% 99% 99%
Europe / Africa 89% 100% 90%
North and South America 75% 90% 78%
---------- ---------- ----------
Total jackup rigs 89% 96% 90%
Semisubmersible rig - N.
America 97% 96% 97%
Barge rig - Asia Pacific 100% 98% 100%
---------- ---------- ----------
Total 89% 96% 90%
========== ========== ==========
CONTACT: ENSCO International Incorporated
Richard LeBlanc, 214-397-3011
SOURCE: ENSCO International Incorporated
