OREANDA-NEWS. For the three months ended June 30, 2016, Rowan Companies plc ("Rowan" or the "Company") (NYSE: RDC) reported net income of $216.7 million, or $1.72 per diluted share, compared to $84.7 million, or $0.68 per diluted share, in the second quarter of 2015. Net income for the current quarter included a $120.0 million, or $0.95 per share, after-tax increase to net income for the Rowan Relentless contract termination and related items. The $120.0 million reflects the amount in excess of the Rowan Relentless drillship's day rate for the three months ended June 30, 2016. Additionally, net income for the current quarter included a $1.8 million, or $0.01 per share, after-tax gain on early extinguishment of debt. Excluding the impact of these items, net income as adjusted was $94.9 million, or $0.75 per share.

Rowan's revenues were $611.9 million in the second quarter of 2016, an increase of 20% from the prior-year quarter due to the aforementioned contract termination and related items as well as contributions from the ultra-deepwater drillships Rowan Relentless, which commenced operations in June of 2015, and Rowan Reliance, which experienced lower levels of downtime in the second quarter of 2016. The increase in drillship revenue was partially offset by a 22% decline in jack-up revenue due to lower utilization and lower day rates.

Tom Burke, President and Chief Executive Officer, commented, "Our ability to add significant backlog in a challenging market environment is a testament to our outstanding crews. I'm pleased that we secured over 700 contract days of new backlog between a blend and extend agreement on our ultra-deepwater drillship, the Rowan Resolute, and contract extensions in our jack-up fleet. We ended the second quarter with our lowest total recordable incident rate (TRIR) on record and our operational downtime was less than 2% for our fleet. Rowan believes safe, reliable and efficient operations are paramount in securing additional work with both new and existing customers."

Rowan is a global provider of contract drilling services with a fleet of 31 mobile offshore drilling units, comprised of 27 jack-up rigs and four ultra-deepwater drillships.  The Company's fleet operates worldwide, including the United States Gulf of Mexico, the United Kingdom and Norwegian sectors of the North Sea, the Middle East, Trinidad and Suriname.  The Company's Class A Ordinary Shares are traded on the New York Stock Exchange under the symbol "RDC." 

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED  STATEMENTS  OF  OPERATIONS

Unaudited  (in  millions  except  per  share  amounts)
           
 

THREE  MONTHS

  

SIX MONTHS
 

ENDED  JUNE 30,

  

ENDED  JUNE 30,
 

2016

  

2015

  

2016

  

2015
               

REVENUES

$       611.9

  

$  508.7

  

$   1,112.0

  

$   1,055.8
               

COSTS  AND  EXPENSES:

              

Operations

207.5

  

253.9

  

412.3

  

509.7

Depreciation and amortization

100.1

  

95.4

  

199.0

  

185.1

Selling, general and administrative

26.2

  

31.2

  

53.0

  

58.7

Loss (gain) on disposals of property and equipment

1.9

  

0.3

  

4.1

  

(0.2)

Material charges and other operating expenses

-

  

5.0

  

-

  

5.0

Total

335.7

  

385.8

  

668.4

  

758.3

INCOME FROM  OPERATIONS

276.2

  

122.9

  

443.6

  

297.5

Net interest and other income (expense)

(36.7)

  

(30.5)

  

(77.2)

  

(64.2)

INCOME BEFORE INCOME TAXES

239.5

  

92.4

  

366.4

  

233.3

Provision for income taxes

22.8

  

7.7

  

26.9

  

24.9

NET INCOME

$       216.7

  

$    84.7

  

$      339.5

  

$      208.4
               

NET INCOME PER DILUTED SHARE

$         1.72

  

$    0.68

  

$        2.70

  

$        1.67
               

WEIGHTED AVERAGE SHARES - DILUTED

126.3

  

125.4

  

125.9

  

125.1
 

NOTE:  See page 6 for supplemental operating information.

            

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED  BALANCE  SHEETS

(in  millions)

(Unaudited)
         
         
 

June 30,

  

December 31,

  
 

2016

  

2015

  

ASSETS

        
         

Cash and cash equivalents

$     761.4

  

$          484.2

  

Accounts receivable

550.4

  

410.5

  

Prepaid expenses and other current assets

30.3

  

26.6

  

Total current assets

1,342.1

  

921.3

  

Property, plant and equipment - net

7,254.9

  

7,405.8

  

Other assets

22.7

  

20.2

  

TOTAL

$  8,619.7

  

$       8,347.3

  
         
         

LIABILITIES  AND  SHAREHOLDERS'  EQUITY

        
         

Accounts payable

$     109.6

  

$          109.6

  

Other current liabilities

198.5

  

219.1

  

Total current liabilities

308.1

  

328.7

  

Long-term debt

2,645.4

  

2,692.4

  

Other liabilities

539.4

  

553.7

  

Commitments and contingent liabilities

        

Stockholders' equity

5,126.8

  

4,772.5

  

TOTAL

$  8,619.7

  

$       8,347.3

  

ROWAN  COMPANIES  PLC

CONDENSED  CONSOLIDATED   STATEMENTS  OF  CASH  FLOWS

Unaudited  (in  millions)
       
       
 

SIX  MONTHS
 

ENDED  JUNE 30,
 

2016

  

2015
       

CASH PROVIDED BY OPERATIONS:

      

Net income

$  339.5

  

$  208.4

Adjustments to reconcile net income to net cash provided by operations:

      

Depreciation and amortization

199.0

  

185.2

Deferred income taxes

(5.2)

  

(12.6)

Loss (gain) on disposal of assets

4.1

  

(0.2)

Other, net

7.9

  

25.1

Net changes in current assets and liabilities

(149.8)

  

45.3

Net changes in other noncurrent assets and liabilities

(7.1)

  

(2.5)

   Net cash provided by operations

388.4

  

448.7
       

CASH USED IN INVESTING ACTIVITIES:

      

Capital expenditures

(64.4)

  

(616.4)

Proceeds from disposals of property and equipment

1.1

  

2.3

   Net cash used in investing activities

(63.3)

  

(614.1)
       

CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:

      

Proceeds from borrowings

-

  

220.0

Reductions in long-term debt

(47.9)

  

(170.0)

Payment of cash dividends

-

  

(25.2)

   Net cash provided by (used in) financing activities

(47.9)

  

24.8
       

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

277.2

  

(140.6)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

484.2

  

339.2

CASH AND CASH EQUIVALENTS, END OF PERIOD

$  761.4

  

$  198.6

ROWAN  COMPANIES  PLC

SUPPLEMENTAL  OPERATING  SEGMENT  INFORMATION

Unaudited (in millions)
               
 

THREE MONTHS ENDED JUNE 30,

  

SIX MONTHS ENDED JUNE 30,
 

2016

  

2015

  

2016

  

2015

Deepwater:

              

Revenues

$  341.4

  

$  161.9

  

$     563.9

  

$     308.8

Operating expenses:

              

Direct operating costs 

56.0

  

70.4

  

123.0

  

129.5

Depreciation and amortization

29.9

  

21.2

  

57.2

  

38.8

Selling, general and administrative

-

  

-

  

-

  

-

Material charges and other

-

  

-

  

0.3

  

-

Income from operations

$  255.5

  

$    70.3

  

$     383.4

  

$     140.5
               

Jack-ups:

              

Revenues

$  270.5

  

$  346.8

  

$     548.1

  

$     747.0

Operating expenses:

              

Direct operating costs 

151.5

  

183.5

  

289.3

  

380.2

Depreciation and amortization

71.1

  

70.9

  

139.5

  

140.0

Selling, general and administrative

-

  

-

  

-

  

-

Material charges and other

1.8

  

5.0

  

3.7

  

5.0

Income from operations

$    46.1

  

$    87.4

  

$     115.6

  

$     221.8
               

Unallocated costs and other:

              

Revenues

$          -

  

$          -

  

$             -

  

$             -

Operating expenses:

              

Direct operating costs 

-

  

-

  

-

  

-

Depreciation and amortization

(0.9)

  

3.3

  

2.3

  

6.3

Selling, general and administrative

26.2

  

31.2

  

53.0

  

58.7

Material charges and other

0.1

  

0.3

  

0.1

  

(0.2)

Income (loss) from operations

$  (25.4)

  

$  (34.8)

  

$     (55.4)

  

$     (64.8)
               

Consolidated:

              

Revenues

$  611.9

  

$  508.7

  

$  1,112.0

  

$  1,055.8

Operating expenses:

              

Direct operating costs 

207.5

  

253.9

  

412.3

  

509.7

Depreciation and amortization

100.1

  

95.4

  

199.0

  

185.1

Selling, general and administrative

26.2

  

31.2

  

53.0

  

58.7

Material charges and other

1.9

  

5.3

  

4.1

  

4.8

Income from operations

$  276.2

  

$  122.9

  

$     443.6

  

$     297.5

ROWAN  COMPANIES  PLC

SUPPLEMENTAL  OPERATING  INFORMATION

Unaudited
 

THREE  MONTHS  ENDED
 

June 30,

  

March 31,

  

June 30,
 

2016

  

2016

  

2015

RIG DAYS:(1)

          

Deepwater:

          

Operating

325

  

361

  

251

Available

364

  

364

  

288
           

Jack-up:

          

Operating

1,605

  

1,497

  

1,987

Available

2,184

  

2,184

  

2,457
           

Total:

          

Operating

1,930

  

1,858

  

2,238

Available

2,548

  

2,548

  

2,745
           

UTILIZATION (1)

          

Deepwater

89%

  

99%

  

87%

Jack-up

73%

  

69%

  

81%

Total

76%

  

73%

  

82%
           

AVERAGE DAY RATES(2) (in  thousands):

          

Deepwater(3)

$  607.0

  

$     612.4

  

$  620.2

Jack-up

$  164.9

  

$     182.3

  

$  171.1

Total(3)

$  239.4

  

$     266.0

  

$  221.4
           

(1) Available rig days and utilization exclude cold-stacked days.

(2) Average day rates exclude other revenue, which is primarily revenue received for contract reimbursable costs.

(3) Includes 52 operating days for the Rowan Relentless up to the contract termination.

ROWAN COMPANIES PLC

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

Unaudited (in millions)
               
 

THREE  MONTHS

  

SIX  MONTHS
 

ENDED JUNE 30,

  

ENDED JUNE 30,
 

2016

  

2015

  

2016

  

2015

NET INCOME:

              

GAAP NET INCOME

$  216.7

  

$    84.7

  

$  339.5

  

$   208.4

Gain on debt extinguishment, net of tax

(1.8)

  

-

  

(2.4)

  

-

Litigation charge, net of tax

-

  

3.3

  

-

  

3.3

Customer contract termination settlement, net of tax

(120.0)

  

-

  

(120.0)

  

-

NON-GAAP NET INCOME

$    94.9

  

$    88.0

  

$  217.1

  

$   211.7
               

DILUTED INCOME PER SHARE:*

              

GAAP NET INCOME PER SHARE

$    1.72

  

$    0.68

  

$    2.70

  

$     1.67

Gain on debt extinguishment, net of tax

(0.01)

  

-

  

(0.02)

  

-

Litigation charge, net of tax

-

  

0.02

  

-

  

0.02

Customer contract termination settlement, net of tax

(0.95)

  

-

  

(0.95)

  

-

NON-GAAP NET INCOME PER SHARE

$    0.75

  

$    0.70

  

$    1.73

  

$     1.69
               

ADJUSTED EARNINGS BEFORE INTEREST, TAXES AND DEPRECIATION (EBITDA):

              

GAAP NET INCOME

$  216.7

  

$    84.7

  

$  339.5

  

$   208.4

Depreciation and amortization

100.1

  

95.4

  

199.0

  

185.1

Interest (income) expense and other, net

38.5

  

30.5

  

79.6

  

64.2

Income tax expense (benefit)

22.8

  

7.7

  

26.9

  

24.9

Gain on debt extinguishment

(1.8)

  

-

  

(2.4)

  

-

Litigation charge

-

  

5.0

  

-

  

5.0

Customer contract termination settlement

(120.0)

  

-

  

(120.0)

  

-

NON-GAAP ADJUSTED EBITDA

$  256.3

  

$  223.3

  

$  522.6

  

$   487.6
               

* Per share amounts may not sum due to rounding.