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Noble Announces Divestment Of Four Jackups In Saudi Arabia

Noble Corporation announced that subsidiaries of the Company have reached a definitive agreement to sell four jackups to ADES International Holding Ltd., through its subsidiary, for $292 million. The Company expects to generate approximately $285 million in cash from the transaction net of fees, expenses, and the settlement of working capital. The Noble Roger Lewis, Noble Scott Marks, Noble Joe Knight, and Noble Johnny Whitstine will be sold and the current drilling contracts novated to ADES. Closing is expected before the end of October 2021 and is subject to the satisfaction of closing conditions, including novation of the drilling contracts and regulatory approvals.

Given the impact of the transaction, the Company also provided the following updated 2021 guidance, and preliminary 2022 guidance, which is pro forma for the divestiture:

 ($ in millions)

Updated 2021 Guidance (1,2)

Preliminary 2022 Guidance  (1)

Adjusted Revenue (3)

$870 – $890

$975 – $1,050 (5)

Adjusted EBITDA (3,4)

$110 – $120

$265 – $300 (5)

Capital Expenditures

$175 – $195

$105 – $120

(1)

Noble provides guidance based on guidance basis, which is a non-GAAP financial measure. Management evaluates Noble’s financial performance in part based on guidance basis, which management believes enhances investors’ understanding of Noble’s overall financial performance by providing them with an additional meaningful and relevant comparison of current and anticipated future results across periods.  The adjustments to arrive at guidance basis are described below.  Due to the forward-looking nature of Adjusted EBITDA, management cannot reliably predict certain of the necessary components of the most directly comparable forward-looking GAAP measure.  Accordingly, the company is unable to present a quantitative reconciliation of such forward-looking non-GAAP financial measure to the most directly comparable forward-looking GAAP financial measure without unreasonable effort. 

(2)

The Company has combined the 2021 results for the Predecessor and Successor periods as non-GAAP measures when giving full-year 2021 guidance since we believe it provides the most meaningful basis to analyze our 2021 results. 

(3)

Adjusted to exclude recognition of the non-cash intangible contract asset amortization of ~$51 million and ~$44 million in 2021 and 2022, respectively.  Without these adjustments, Revenue guidance ranges for 2021 and 2022 would be $819 million – $839 million and $931 million – $1,006 million, respectively.

(4)

The Company discloses Adjusted EBITDA (Operating Profit/loss excluding Depreciation and Amortization and, when applicable, Other Items).  Other Items include amortization of intangible contract assets, restructuring related items, merger and integration costs, and non-cash stock-based compensation expense related to the Company’s management incentive plan.

(5)

Of the total calendar days available for our fleet in 2022, Noble assumes 86% of the days are operating days (excluding cold stacked rigs). Of the operating days, 61% are currently under firm contract, and 22% are assumed exercised options. 22% of the available days are under the CEA agreement where the market rate has yet to be determined.

“We are very pleased to have reached this mutually beneficial deal with ADES, which is accretive to our shareholders.  The sale of these four jackups further bolsters our already strong balance sheet and improves Noble’s financial flexibility.  As we look to 2022, our anticipated net cash position coupled with our expected free cash flow generation better positions the company to execute on our financial priorities to repay debt and return cash to shareholders,” said Robert Eifler, President and CEO of Noble Corporation. Mr. Eifler continued, “Our crews in the Kingdom have executed at the highest level for many years, and Noble and ADES are fully aligned to ensure this level of operational excellence is maintained.  I would personally like to thank the Noble employees who will be hired by ADES for their dedicated service and wish them continued success.”

DNB Markets, a part of DNB Bank ASA, and Ducera Partners LLC are acting as financial advisors, and Baker Botts L.L.P. is acting as legal advisor to Noble.  Clarksons Platou is acting as broker.

 

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