Vantage Drilling International Ltd. Reports Third Quarter 2024 Results

  • November 7, 2024
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  • Vantage Drilling International Ltd. Reports Third Quarter 2024 Results

Dubai, Nov. 07, 2024 (GLOBE NEWSWIRE) — DUBAI, November 7, 2024 (GLOBE NEWSWIRE) — Vantage Drilling International Ltd. (“Vantage” or the “Company”) reported a net loss attributable to shareholders of approximately $10.6 million or $0.80 per diluted share for the three months ended September 30, 2024, based on weighted average shares outstanding, as compared to a near breakeven net income attributable to shareholders for the three months ended September 30, 2023.

As of September 30, 2024, Vantage had approximately $57.6 million in cash. This total includes $6.4 million of restricted cash and $12.4 million pre-funded by our Managed Services customers for near-term obligations. In comparison, on December 31, 2023, Vantage had $84.0 million in cash, including $10.8 million of restricted cash and $11.6 million pre-funded by our Managed Services customers.

Ihab Toma, CEO, commented: “The third quarter marked important progress for the company. We successfully placed the Topaz Driller on contract, delivering it on time and within budget. We also continued the upgrades to the Platinum Explorer to improve its marketability. Additionally, we announced the sale of both the Topaz Driller and Soehanah for $190 million, along with three 3-year management and support agreements, further reinforcing our commitment to the managed services segment and strengthening the company’s balance sheet.”

Mr. Toma continued, “The $6.4 million in EBITDA generated this quarter, along with our key milestones achieved, reflects the efficiency of our operations and our organization’s ability to navigate through this transitional period”

Vantage, a Bermuda exempted company, is an offshore drilling contractor, with a fleet of two ultra-deepwater drillships, and two premium jackup drilling rigs. Vantage’s primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells globally for major, national and independent oil and gas companies. Vantage also markets, operates and provides management services in respect of, third party-owned drilling units. www.vantagedrilling.com. 

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the Company’s reports or filings posted to its website or otherwise made available to its investors or creditors. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements. Vantage disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Non-GAAP Measures

We report our financial results in accordance with generally accepted accounting principles (GAAP) in the United States. However, in our earnings release and during our earnings calls we may reference company information that does not conform to GAAP. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the Company and allows investors to better evaluate the financial results of the Company. However, these measures should not be viewed as an alternative to or substitute for GAAP measures of performance, and these non-GAAP measures may not be consistent with previously published Company reports on Forms 10-K, 10-Q and 8-K. Non-GAAP measures we may reference have been reconciled to the nearest GAAP measure in the tables entitled Reconciliation of GAAP to Non-GAAP Financial Measures below.

Public & Investor Relations Contact:
     Rafael Blattner
     Chief Financial Officer
     Vantage Drilling International Ltd.
     +971 4 449 34 28

               

                                     
Vantage Drilling International Ltd.    
Condensed Consolidated Statements of Operations    
(In thousands, except per share data)    
(Unaudited)    
                     
    Three Months Ended September 30,   Nine Months Ended September 30,    
    2024   2023   2024   2023    
Revenue                    
Contract drilling services   $ 35,264     $ 76,190     $ 129,593     $ 191,780      
Management fees     2,973       6,086       14,196       13,775      
Reimbursables and other     10,717       21,426       31,125       83,059      
Total revenue     48,954       103,702       174,914       288,614      
Operating costs and expenses                    
Operating costs     38,012       73,988       130,296       214,926      
General and administrative     5,716       5,561       18,195       15,553      
Depreciation     11,247       11,065       33,739       33,159      
(Gain) loss on EDC Sale     –       –       –       3      
Total operating costs and expenses     54,975       90,614       182,230       263,641      
Income (loss) from operations          (6,021)             13,088             (7,316)          24,973      
Other (expense) income                    
Interest income               212                  251                  706               441      
Interest expense and other financing charges          (6,358)              (5,343)           (17,358)        (16,247)      
Other, net            1,222                  115                  244               (20)      
Total other expense          (4,924)              (4,977)           (16,408)        (15,826)      
Income (loss) before income taxes        (10,945)               8,111           (23,724)            9,147      
Income tax provision (benefit)             (342)               8,097               4,280          10,703      
Net income (loss)        (10,603)                    14           (28,004)          (1,556)      
Net income (loss) attributable to non-controlling interests                 (5)                    10                (314)             (736)      
Net income (loss) attributable to shareholders   $    (10,598)     $                4     $     (27,690)     $       (820)      
                     
EBITDA(1)   $ 6,448     $ 24,268     $ 26,667     $ 58,112      
                     
Earnings (loss) per share                    
Basic and Diluted   $ (0.80)     $ 0.00     $ (2.09)     $ (0.06)      
Weighted average ordinary shares outstanding,                    
Basic     13,295       13,229       13,276       13,213      
                     
Diluted     13,295       13,323       13,276       13,213      
                     
(1) EBITDA represents net income (loss) before (i) interest income (expense), (ii) provision for income taxes and (iii) depreciation and amortization expense. EBITDA is not a financial measure under GAAP as defined under the rules of the SEC, and is intended as a supplemental measure of our performance. We believe this measure is commonly used by analysts and investors to analyze and compare companies on the basis of operating performance.    
                     
                                     
                                     
                 
Vantage Drilling International Ltd.
Supplemental Operating Data
(in thousands, except percentages)
(Unaudited)
                 
    Three Months Ended September 30,   Nine Months Ended September 30,
    2024   2023   2024   2023
Operating costs and expenses                
Jackups   $ 4,958     $ 7,366     $ 21,128     $ 15,088  
Deepwater     20,119       26,056       66,383       69,174  
Managed Rigs     47       17,825       4,569       52,084  
Operations support     2,917       2,764       9,083       8,340  
Reimbursables     9,971       19,977       29,133       70,240  
Total operating costs and expenses   $ 38,012     $ 73,988     $ 130,296     $ 214,926  
Utilization                
Jackups     50.3%       67.2%       63.3%       83.4%  
Deepwater     49.4%       84.9%       53.7%       81.0%  
                                 
                                     
                                     
                     
Vantage Drilling International Ltd.                    
Condensed Consolidated Balance Sheets                    
(In thousands, except share and par value information)                    
(Unaudited)                    
                             
    September 30, 2024   December 31, 2023                    
                             
ASSETS                            
Current assets                            
Cash and cash equivalents   $      51,169     $       73,206                      
Restricted cash            1,071               1,828                      
Trade receivables, net of allowance for credit losses of $5,799 and $5,434, respectively          69,831             74,113                      
Materials and supplies          56,151             46,704                      
Prepaid expenses and other current assets          31,423             37,423                      
Total current assets        209,645           233,274                      
Property and equipment                            
Property and equipment        684,190           660,449                      
Accumulated depreciation      (380,230)          (352,357)                      
Property and equipment, net        303,960           308,092                      
Operating lease ROU assets               518               1,084                      
Other assets          44,838             19,283                      
Total assets   $    558,961     $     561,733                      
                             
LIABILITIES AND SHAREHOLDERS’ EQUITY                            
Current liabilities                            
Accounts payable   $      50,910     $       62,245                      
Debt due within one year          25,000                     –                        
Other current liabilities          39,466             51,946                      
Total current liabilities        115,376           114,191                      
Long–term debt, net of discount and financing costs of $8,112 and $9,893 respectively        191,888           190,107                      
Other long-term liabilities          32,010             10,741                      
Shareholders’ equity                            
Ordinary shares, $0.001 par value, 50 million shares authorized; 13,295,262 and 13,229,280 shares issued and outstanding, each period                 13                    13                      
Additional paid-in capital        634,960           633,963                      
Accumulated deficit      (416,213)          (388,523)                      
Controlling interest shareholders’ equity        218,760           245,453                      
Noncontrolling interests               927               1,241                      
Total equity        219,687           246,694                      
Total liabilities and shareholders’ equity   $    558,961     $     561,733                      
                             
                                     
                                     
                     
Vantage Drilling International Ltd.                    
Condensed Consolidated Statements of Cash Flows                    
(In thousands)                    
(Unaudited)                    
    Nine Months Ended September 30,                    
    2024   2023                    
CASH FLOWS FROM OPERATING ACTIVITIES                            
Net loss   $    (28,004)     $        (1,556)                      
Adjustments to reconcile net loss to net cash used in operating activities                            
Depreciation expense          33,739             33,159                      
Amortization of debt financing costs            2,518               1,455                      
Share-based compensation expense            1,537                    45                      
Loss on debt extinguishment                 –                    703                      
Deferred income tax expense               193                  994                      
Loss on disposal of assets                 79                     –                        
Loss on EDC Sale                 –                        3                      
Allowance for credit losses               365                     –                        
Changes in operating assets and liabilities:                            
Trade receivables, net            3,917            (24,537)                      
Materials and supplies          (9,447)              (6,723)                      
Prepaid expenses and other current assets            6,000              (9,377)                      
Other assets        (27,676)               4,810                      
Accounts payable        (11,335)               5,416                      
Other current liabilities and other long-term liabilities          11,964            (15,822)                      
Net cash used in operating activities        (16,150)            (11,430)                      
CASH FLOWS FROM INVESTING ACTIVITIES                            
Additions to property and equipment        (29,766)              (6,833)                      
Proceeds from disposal of assets                 80                     –                        
Net cash used in investing activities        (29,686)              (6,833)                      
CASH FLOWS FROM FINANCING ACTIVITIES                            
Proceeds from 9.50% First Lien Notes                 –             194,000                      
Proceeds from Revolving Credit Facility          25,000                     –                        
Repayment of long-term debt                 –            (180,000)                      
Shares repurchased for tax withholdings on settlement of RSUs             (441)                 (246)                      
Payments of dividend equivalents          (3,272)              (5,278)                      
Debt issuance costs          (1,833)              (5,850)                      
Net cash (used in) provided by financing activities          19,454               2,626                      
Net decrease in unrestricted and restricted cash and cash equivalents        (26,382)            (15,637)                      
Unrestricted and restricted cash and cash equivalents—beginning of period          83,975             93,257                      
Unrestricted and restricted cash and cash equivalents—end of period   $      57,593     $       77,620                      
                             
                                     
                                     
     
Vantage Drilling International Ltd.    
Non-GAAP Measures    
(In thousands)    
(Unaudited)    
                     
    Three Months Ended September 30,   Nine Months Ended September 30,    
Reconciliation of EBITDA   2024   2023   2024   2023    
Net income (loss)   $  (10,603)     $             14     $   (28,004)     $   (1,556)      
Depreciation        11,247           11,065           33,739        33,159      
Interest income            (212)               (251)               (706)            (441)      
Interest expense and other financing costs          6,358              5,343           17,358        16,247      
Income tax provision            (342)              8,097             4,280        10,703      
EBITDA   $      6,448     $     24,268     $     26,667     $  58,112      

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