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Noble Corporation Reports Record Earnings of $ 1.86 Per Share For the First Quarter 2007 on Revenues of $ 646 Million

Posted on: Thursday, 19 April 2007, 09:00 CDT

SUGAR LAND, Texas, April 19 /PRNewswire-FirstCall/ -- Noble Corporation today reported first quarter earnings of $250 million or $1.86 per diluted ordinary share versus $200 million or $1.47 in the prior quarter and $145 million or $1.05 in the first quarter of last year.

Contract drilling services revenue for the first quarter was $577 million, up 14 percent compared to $508 million in the prior quarter and up 41 percent compared to $408 million in the first quarter of last year.

Cash operating margins exceeded 65 percent, generating $270 million in net cash provided by operating activities in the first quarter. The Company invested $237 million in capital projects during the quarter. Debt as a percentage of total capitalization increased to 19 percent at March 31, 2007, from 18 percent at December 31, 2006.

Mark A. Jackson, Noble Corporation President and Chief Executive Officer, said, "Our strong first quarter results reflect continued execution of our strategy -- securing contracts for our premium jackups in key international markets, adding to our ultra-deepwater fleet, maximizing our margins by controlling costs, and delivering on our shipyard projects. At the same time, we extended our outstanding safety record by working over 3 million hours without a lost time accident."

As previously announced in February of this year, the Company's Board of Directors approved an increase in the total number of ordinary shares authorized for repurchase to 15.3 million shares. During the first quarter, the Company repurchased 1.2 million shares at an average price of $72.71 for a total investment of $87 million. In the last 12 months, 5 million shares have been repurchased with a total investment of $354 million at an average price of $70.85 per share.

Operations Review

All of the Company's premium jackups are located in four major international markets, where activity increases and strong pricing momentum led to higher dayrates for contracts that were extended or renewed by the Company in the first quarter. Including contracts signed in the current quarter, 86 percent and 51 percent of available days for our international jackup fleet are committed for 2007 and 2008, respectively.

In the Middle East, the Noble Kenneth Delaney received a contract extension at $195,000 per day and the Noble Dick Favor received an extension at a dayrate of $160,000. Both of these extensions were leading edge dayrates for jackups working in water depths of 300 and 150 feet, respectively.

The Company also received commitments in the North Sea for the Noble Lynda Bossler and the Noble George Sauvageau at dayrates of $220,000 and $225,000, extending their contracts through mid and late 2008. Both jackups are capable of working in water depths up to 250 feet.

Contracts were also extended for jackups located in West Africa and Mexico during the quarter, the Noble Don Walker at a dayrate of $165,000 currently working in Nigeria, and $150,000 per day for the Noble Earl Frederickson working for PEMEX. The Noble Don Walker, a 150 foot jackup, is now contracted through the spring of 2008. In Mexico, the Noble Earl Frederickson, a 250 foot jackup, is also contracted through the spring of 2008.

In the deepwater arena, the Company announced the signing of a Letter of Intent for the Noble Jim Day, adding another 12,000 foot dynamically positioned semisubmersible to our fleet in late 2009. With the completion of the Noble Clyde Boudreaux, Noble will operate six deepwater semisubmersibles in the U.S. Gulf of Mexico, which account for approximately 25 percent of total contract drilling services revenue.

Shipyard Projects Update

At the end of the first quarter, the Company had customer commitments for three 400 foot jackups and one 10,000 foot dynamically positioned semisubmersible being constructed in Dalian, China. The first of these new jackups, the Noble Roger Lewis, is scheduled for final commissioning and transport to Qatar in the third quarter of 2007. The Noble Hans Deul and Noble Scott Marks are scheduled for final commissioning and transport to the North Sea in the second quarters of 2008 and 2009, respectively. All of our new jackups are being constructed under turnkey contracts with the shipyard.

The Noble Dave Beard, a 10,000 foot dynamically positioned semisubmersible, is scheduled for final commissioning and transport to Brazil in the third quarter of 2008.

Construction on the Noble Danny Adkins and the Noble Jim Day, two 12,000 foot dynamically positioned semisubmersibles, is well under way in the Jurong shipyard in Singapore. All long lead time equipment has been purchased, facilitating the scheduled delivery of the Noble Danny Adkins in the first quarter of 2009 and a fourth quarter 2009 delivery for the Noble Jim Day. Achieving on-time delivery for our seven major newbuild projects, including the Noble Clyde Boudreaux, should generate additional earnings per share of approximately $3.90 in the calendar year 2010.

In addition to the major newbuild projects described above, the Company budgeted 602 unpaid shipyard days in 2007 for major upgrades, repairs and inspections of our existing fleet, comprising 21 separate projects. In the first quarter, Noble budgeted 98 shipyard days on five projects in three different shipyards. Actual shipyard days were 1 percent above Budget while actual costs were 2 percent below Budget.

Conference Call

Noble will hold a conference call today at 1:00 p.m., Central time, to provide shareholders and other interested parties an overview of the Company's first quarter 2007 performance. Those interested in hearing the conference call may listen via telephone by dialing 800-737-8127, or internationally 212-231-6042, using pass code 21324117. Alternatively, interested parties may listen to the call over the Internet through the Investor section of the Company's Web site, using the "Web cast" link. A replay of the conference call will be available on Thursday, April 19, 2007, beginning at 5:00 p.m., Central time, through Wednesday, April 25, 2007, ending at 5:00 p.m., Central time. The phone number for the conference call replay is 800-633-8284 or internationally 402-977-9140. The access code is the same (as indicated above for the conference call). The conference call may include non-GAAP financial measures. Noble will post a reconciliation of those measures to the most directly comparable GAAP measures in the Investor section of the Company's Web site under the heading "Reg. G Reconciliation."

This news release may contain "forward-looking statements" about the business, financial performance and prospects of the Company. Statements about the Company's or management's plans, intentions, expectations, beliefs, estimates, predictions, or similar expressions for the future are forward-looking statements. No assurance can be given that the outcomes of these forward-looking statements will be realized, and actual results could differ materially from those expressed as a result of various factors. A discussion of these factors, including risks and uncertainties, is set forth from time to time in the Company's filings with the U.S. Securities and Exchange Commission.

Noble Corporation is a leading provider of diversified services for the oil and gas industry. The Company performs contract drilling services with its fleet of 62 mobile offshore drilling units located in key markets worldwide, including the U.S. Gulf of Mexico, Middle East, Mexico, the North Sea, Brazil, West Africa and India. The fleet count includes six rigs under construction. The Company also provides labor contract drilling services, well site and project management services, and engineering services. The Company's ordinary shares are traded on the New York Stock Exchange under the symbol "NE".

Additional information on Noble Corporation is available via the worldwide web at http://www.noblecorp.com/.

NOBLE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) (Unaudited) Three Months Ended March 31, 2007 2006 OPERATING REVENUES Contract drilling services $ 576,915 $ 408,347 Reimbursables 31,143 23,072 Labor contract drilling services 36,555 26,516 Engineering, consulting and other 1,811 3,980 646,424 461,915 OPERATING COSTS AND EXPENSES Contract drilling services 196,842 160,864 Reimbursables 27,546 20,052 Labor contract drilling services 28,403 21,938 Engineering, consulting and other 3,641 3,271 Depreciation and amortization 64,465 59,361 Selling, general and administrative 14,226 10,285 Hurricane losses and (recoveries), net --- (4,404) 335,123 271,367 OPERATING INCOME 311,301 190,548 OTHER INCOME (EXPENSE) Interest expense, net of amount capitalized (1,504) (12,479) Other, net 1,158 2,342 INCOME BEFORE INCOME TAXES 310,955 180,411 INCOME TAX PROVISION (60,635) (35,180) NET INCOME $ 250,320 $ 145,231 NET INCOME PER SHARE: Basic $ 1.87 $ 1.06 Diluted $ 1.86 $ 1.05 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 133,561 136,721 Diluted 134,800 138,455 NOBLE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except per share amounts) (Unaudited) March 31, December 31, 2007 2006 ASSETS CURRENT ASSETS Cash and cash equivalents $ 77,113 $ 61,710 Accounts receivable 461,547 408,241 Insurance receivables 39,717 54,191 Inventories 4,642 4,461 Prepaid expenses 22,941 20,491 Other current assets 26,106 20,886 Total current assets 632,066 569,980 PROPERTY AND EQUIPMENT Drilling equipment and facilities 5,428,410 5,215,477 Other 76,690 71,870 5,505,100 5,287,347 Accumulated depreciation (1,476,242) (1,428,954) 4,028,858 3,858,393 OTHER ASSETS 159,704 157,541 $ 4,820,628 $ 4,585,914 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Current maturities of long-term debt $ 9,800 $ 9,629 Accounts payable 138,897 196,111 Accrued payroll and related costs 88,225 93,251 Taxes payable 95,666 52,793 Interest payable 7,883 9,683 Other current liabilities 68,217 64,793 Total current liabilities 408,688 426,260 LONG-TERM DEBT 766,965 684,469 DEFERRED INCOME TAXES 222,315 219,521 OTHER LIABILITIES 51,585 34,019 1,449,553 1,364,269 COMMITMENTS AND CONTINGENCIES MINORITY INTEREST (7,439) (7,348) SHAREHOLDERS' EQUITY Ordinary shares-par value $0.10 per share; 400,000 shares authorized; 133,749 shares issued and outstanding in 2007; 134,592 shares issued and outstanding in 2006 13,375 13,459 Capital in excess of par value 710,728 789,354 Retained earnings 2,673,967 2,446,056 Accumulated other comprehensive income (loss) (19,556) (19,876) 3,378,514 3,228,993 $ 4,820,628 $ 4,585,914 NOBLE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Three Months Ended March 31, 2007 2006 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 250,320 $ 145,231 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 64,465 59,361 Deferred income tax provision 2,794 --- Share-based compensation expense 7,340 5,395 Hurricane losses and recoveries, net --- (4,404) Other 2,903 (2,284) Other changes in current assets and liabilities: Accounts receivable (53,306) (55,277) Other current assets 5,795 (15,680) Accounts payable (49,536) (3,424) Other current liabilities 39,471 22,185 Net cash provided by operating activities 270,246 151,103 CASH FLOWS FROM INVESTING ACTIVITIES New construction (115,049) (114,092) Other capital expenditures (103,216) (76,704) Major maintenance expenditures (18,413) (24,426) Accrued capital expenditures 9,627 --- Proceeds from sales and maturities of marketable securities --- 6,582 Net cash used for investing activities (227,051) (208,640) CASH FLOWS FROM FINANCING ACTIVITIES Borrowings on credit facilities 170,000 --- Payments on bank credit facilities (85,000) --- Payments of other long-term debt (2,345) (4,408) Net proceeds from employee stock transactions (481) 6,529 Dividends paid (5,409) (5,486) Repurchases of ordinary shares (104,557) --- Net cash used for financing activities (27,792) (3,365) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 15,403 (60,902) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 61,710 121,845 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 77,113 $ 60,943 NOBLE CORPORATION AND SUBSIDIARIES FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT (In thousands, except utilization amounts, operating days and average dayrates) (Unaudited) Three Months Ended March 31, 2007 International Domestic Contract Contract Drilling Drilling Other Total OPERATING REVENUES Contract drilling services $ 429,478 $ 147,437 $ --- $ 576,915 Reimbursables 15,989 3,780 11,374 31,143 Labor contract drilling services --- --- 36,555 36,555 Engineering, consulting and other 92 138 1,581 1,811 $ 445,559 $ 151,355 $ 49,510 $ 646,424 OPERATING COSTS AND EXPENSES Contract drilling services $ 160,124 $ 36,718 $ --- $ 196,842 Reimbursables 13,284 3,655 10,607 27,546 Labor contract drilling services --- --- 28,403 28,403 Engineering, consulting and other 161 (20) 3,500 3,641 Depreciation and amortization 48,071 13,738 2,656 64,465 Selling, general and administrative 10,390 3,270 566 14,226 Hurricane losses and (recoveries), net --- --- --- --- $ 232,030 $ 57,361 $ 45,732 $ 335,123 OPERATING INCOME $ 213,529 $ 93,994 $ 3,778 $ 311,301 OPERATING STATISTICS Jackups: Average Rig Utilization 98% N/A 98% Operating Days 3,512 N/A 3,512 Average Dayrate $ 102,112 N/A $ 102,112 Semisubmersibles -- (6,000 feet or greater): Average Rig Utilization 100% 100% 100% Operating Days 180 360 540 Average Dayrate $ 153,023 $ 313,256 $ 259,837 Semisubmersibles -- (less than 6,000 feet): Average Rig Utilization 50% 100% 67% Operating Days 90 90 180 Average Dayrate $ 199,055 $ 154,390 $ 176,722 Drillships: Average Rig Utilization 93% N/A 93% Operating Days 252 N/A 252 Average Dayrate $ 100,740 N/A $ 100,740 Submersibles: Average Rig Utilization N/A 95% 95% Operating Days N/A 256 256 Average Dayrate N/A $ 81,047 $ 81,047 Total: Average Rig Utilization 95% 98% 96% Operating Days 4,034 706 4,740 Average Dayrate $ 106,461 $ 208,755 $ 121,705 (1) Effective January 1, 2007, the Company's 30 percent net profit interest in the Noble Kolskaya is reported in labor contract drilling services. For the quarters ended March 31, 2007, 2006 and December 31, 2006, Noble Kolskaya labor contract drilling margin was $3.6 million, $2.3 million and $2.0 million, respectively. NOBLE CORPORATION AND SUBSIDIARIES FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT (In thousands, except utilization amounts, operating days and average dayrates) (Unaudited) Three Months Ended March 31, 2006 International Domestic Contract Contract Drilling Drilling Other Total OPERATING REVENUES Contract drilling services $ 272,871 $ 135,476 $ --- $ 408,347 Reimbursables 11,490 6,229 5,353 23,072 Labor contract drilling services --- --- 26,516 26,516 Engineering, consulting and other 449 163 3,368 3,980 $ 284,810 $ 141,868 $ 35,237 $ 461,915 OPERATING COSTS AND EXPENSES Contract drilling services $ 122,887 $ 37,977 $ --- $ 160,864 Reimbursables 8,792 6,073 5,187 20,052 Labor contract drilling services --- --- 21,938 21,938 Engineering, consulting and other (35) (110) 3,416 3,271 Depreciation and amortization 45,768 12,540 1,053 59,361 Selling, general and administrative 5,463 3,306 1,516 10,285 Hurricane losses and (recoveries), net --- (4,404) --- (4,404) $ 182,875 $ 55,382 $ 33,110 $ 271,367 OPERATING INCOME $ 101,935 $ 86,486 $ 2,127 $ 190,548 OPERATING STATISTICS Jackups: Average Rig Utilization 100% 86% 99% Operating Days 3,420 155 3,575 Average Dayrate $ 63,880 $ 101,112 $ 65,482 Semisubmersibles -- (6,000 feet or greater): Average Rig Utilization 100% 100% 100% Operating Days 180 360 540 Average Dayrate $ 89,261 $ 241,562 $ 190,795 Semisubmersibles -- (less than 6,000 feet): Average Rig Utilization 100% 100% 100% Operating Days 90 180 270 Average Dayrate $ 113,430 $ 124,183 $ 120,599 Drillships: Average Rig Utilization 100% N/A 100% Operating Days 270 N/A 270 Average Dayrate $ 104,189 N/A $ 104,189 Submersibles: Average Rig Utilization N/A 67% 67% Operating Days N/A 180 180 Average Dayrate N/A $ 58,506 $ 58,506 Total: Average Rig Utilization 100% 88% 98% Operating Days 3,960 875 4,835 Average Dayrate $ 68,909 $ 154,830 $ 84,465 (1) Effective January 1, 2007, the Company's 30 percent net profit interest in the Noble Kolskaya is reported in labor contract drilling services. For the quarters ended March 31, 2007, 2006 and December 31, 2006, Noble Kolskaya labor contract drilling margin was $3.6 million, $2.3 million and $2.0 million, respectively. NOBLE CORPORATION AND SUBSIDIARIES FINANCIAL AND OPERATIONAL INFORMATION BY SEGMENT (In thousands, except utilization amounts, operating days and average dayrates) (Unaudited) Three Months Ended December 31, 2006 International Domestic Contract Contract Drilling Drilling Other Total OPERATING REVENUES Contract drilling services $ 386,260 $ 121,586 $ --- $ 507,846 Reimbursables 14,553 2,021 7,268 23,842 Labor contract drilling services --- --- 27,073 27,073 Engineering, consulting and other (1,298) 124 1,237 63 $ 399,515 $ 123,731 $ 35,578 $ 558,824 OPERATING COSTS AND EXPENSES Contract drilling services $ 151,921 $ 31,250 $ --- $ 183,171 Reimbursables 12,166 1,764 6,460 20,390 Labor contract drilling services --- --- 21,782 21,782 Engineering, consulting and other (181) 2 3,149 2,970 Depreciation and amortization 50,790 13,810 1,259 65,859 Selling, general and administrative 10,128 2,482 847 13,457 Hurricane losses and (recoveries), net --- (6,300) --- (6,300) $ 224,824 $ 43,008 $ 33,497 $ 301,329 OPERATING INCOME $ 174,691 $ 80,723 $ 2,081 $ 257,495 OPERATING STATISTICS Jackups: Average Rig Utilization 93% N/A 93% Operating Days 3,431 N/A 3,431 Average Dayrate $ 89,769 N/A $ 89,769 Semisubmersibles -- (6,000 feet or greater): Average Rig Utilization 100% 100% 100% Operating Days 184 368 552 Average Dayrate $ 164,081 $ 281,654 $ 242,468 Semisubmersibles -- (less than 6,000 feet): Average Rig Utilization 77% 27% 60% Operating Days 141 25 166 Average Dayrate $ 141,996 $ 111,777 $ 138,141 Drillships: Average Rig Utilization 100% N/A 100% Operating Days 276 N/A 276 Average Dayrate $ 101,491 N/A $ 101,491 Submersibles: Average Rig Utilization N/A 74% 74% Operating Days N/A 205 205 Average Dayrate N/A $ 73,607 $ 73,607 Total: Average Rig Utilization 93% 81% 92% Operating Days 4,032 598 4,630 Average Dayrate $ 95,791 $ 203,293 $ 109,666 (1) Effective January 1, 2007, the Company's 30 percent net profit interest in the Noble Kolskaya is reported in labor contract drilling services. For the quarters ended March 31, 2007, 2006 and December 31, 2006, Noble Kolskaya labor contract drilling margin was $3.6 million, $2.3 million and $2.0 million, respectively.

Noble Corporation

CONTACT: investors, Lee M. Ahlstrom, Vice President - Investor Relationsand Planning, +1-281-276-6440, or media, John S. Breed, Director of CorporateCommunications, +1-281-276-6729, both of Noble Drilling Services Inc.

Web site: http://www.noblecorp.com/

Source: PRNewswire-FirstCall

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