Valaris Reports Second Quarter 2026 Results

HAMILTON, Bermuda--( BUSINESS WIRE)--Valaris Limited (NYSE: VAL) ("Valaris" or the "Company") today reported second quarter 2026 results.

President and Chief Executive Officer Anton Dibowitz said, “I want to thank our teams across the organization for their unwavering commitment to safe, reliable and efficient operations. Together we delivered another quarter of strong performance, highlighted by revenue efficiency of 98% and the successful startup of two drillships. These achievements helped drive solid financial results despite the impact of the ongoing conflicts in the Middle East.”

Dibowitz added, “We successfully returned VALARIS DS-12 and DS-10 to work on schedule and on budget during the second quarter. With two additional drillships set to commence new contracts before year-end, these rig startups, together with continued strong operational execution across our fleet, are expected to drive further improvement in our financial performance over the remainder of the year.”

Dibowitz concluded, “We remain positive on the outlook for offshore drilling. The pipeline of deepwater contract opportunities remains robust, and we expect to see further awards across the industry, supported by favorable market fundamentals and strong customer demand for high-specification assets. We are also excited about the pending business combination with Transocean, which is on track to close in the fourth quarter of 2026. The combination is expected to deliver meaningful value to our shareholders through anticipated synergies and the enhanced capabilities of the combined company.”

Financial and Operational Highlights

Second Quarter Review

Net income of $47 million compared to net loss of $18 million in the first quarter 2026. Net income included a gain on the sale of assets of $38 million compared to a loss of $2 million in the first quarter. Adjusted EBITDA of $97 million compared to $67 million in the first quarter 2026.

Revenues exclusive of reimbursable items increased to $502 million from $430 million in the first quarter 2026, primarily due to more operating days for the floater fleet as three drillships recently commenced new contracts, with one commencing late in the first quarter and the other two during the second quarter.

Contract drilling expenses exclusive of reimbursable items increased to $380 million from $340 million in the first quarter 2026, primarily due to incremental operating costs associated with the three drillships that recently commenced new contracts, higher repair and maintenance costs largely associated with planned shipyard projects, and a full quarter of higher costs to maintain insurance coverage for war-related risks for jackups that Valaris operates in the Middle East. These items were partially offset by the reversal of a previously recognized bad debt expense following the collection of long-outstanding customer invoices.

General and administrative expenses increased to $27 million from $25 million in the first quarter 2026.

Merger and integration expenses, which are primarily related to professional fees incurred in connection with the pending business combination with Transocean, decreased to $11 million from $14 million in the first quarter 2026.

Other income of $30 million compared to other expense of $10 million in the first quarter 2026, primarily due to a gain on the sale of jackup VALARIS 104.

Tax expense increased to $34 million from $28 million in the first quarter 2026. The second quarter tax provision included a $6 million discrete tax benefit and the first quarter tax provision included a $2 million discrete tax expense, which were primarily related to the resolution of prior period tax matters. Adjusted for these items, tax expense increased to $40 million from $26 million in the first quarter due to higher income before tax and a change in the jurisdictional mix of income.

Capital expenditures increased to $106 million from $101 million in the first quarter 2026.

Cash and cash equivalents decreased to $541 million as of June 30, 2026, from $578 million as of March 31, 2026, primarily due to capital expenditures, partially offset by cash flow from operations and proceeds from asset sales.

Conflicts in the Middle East

The ongoing conflicts in the Middle East negatively impacted Adjusted EBITDA by approximately $30 million compared to $8 million in the first quarter, primarily due to a full quarter of higher costs to maintain insurance coverage for war-related risks for jackups operated by Valaris in the region, as well as incremental costs and lower revenues associated with project delays for VALARIS 250 and 116, which were undergoing planned maintenance and contract preparation projects in shipyards located in the region.

Based on information currently available, we expect these adverse impacts to moderate in the second half of 2026, as VALARIS 250 recommenced its bareboat charter contract in July and VALARIS 116 is expected to recommence its bareboat charter in the third quarter. In addition, insurance costs to maintain war-related coverage are expected to be lower than those incurred in the first half of the year primarily due to the sale of VALARIS 104 and lower premiums from securing longer term coverage.

Second Quarter Segment Review

Floaters

Revenues exclusive of reimbursable items increased to $279 million from $193 million in the first quarter 2026, primarily due to more operating days for VALARIS DS-17, DS-12 and DS-10, as DS-17 commenced a new contract late in the first quarter and DS-12 and DS-10 commenced new contracts during the second quarter.

Contract drilling expenses exclusive of reimbursable items increased to $168 million from $151 million in the first quarter 2026, primarily due to incremental operating costs associated with the three drillships that recently commenced new contracts. This was partially offset by the reversal of a previously recognized bad debt expense following the collection of long-outstanding customer invoices.

Jackups

Revenues exclusive of reimbursable items decreased to $183 million from $196 million in the first quarter 2026, primarily due to fewer operating days for VALARIS 117, which completed its contract early in the second quarter and began planned maintenance and contract preparations in the shipyard, as well as lower average daily revenues driven by lower day rate accommodation services provided by certain North Sea jackups.

Contract drilling expenses exclusive of reimbursable items increased to $144 million from $129 million in the first quarter 2026, primarily due to higher repair and maintenance costs, largely attributable to planned maintenance for VALARIS 117 and leg repairs for VALARIS 106, as well as a full quarter of higher costs to maintain insurance coverage for war-related risks for jackups operated by Valaris in the Middle East.

ARO Drilling

Revenues of $127 million were in line with the first quarter 2026. Contract drilling expenses decreased to $72 million from $75 million in the first quarter, primarily due to adjustments recorded by ARO in connection with the current quarter finalization of its 2025 financial statements. This was partially offset by higher repair and maintenance costs for rigs undergoing shipyard projects and higher personnel costs.

Other

Revenues exclusive of reimbursable items decreased to $40 million from $42 million in the first quarter 2026. Contract drilling expenses exclusive of reimbursable items increased to $27 million from $23 million in the first quarter, primarily due to planned maintenance and contract preparation projects for VALARIS 250 and 116, as well as a full quarter of higher costs to maintain insurance coverage for war-related risks for those rigs.

Three Months Ended

(Unaudited)

Floaters

Jackups

ARO (1)

Other

Reconciling Items (1)(2)

Consolidated Total

(in millions of $, except %)

2026

Chg

2026

Chg

2026

Chg

2026

Chg

2026

Chg

Operating revenues:

Revenues (exclusive of reimbursable revenues)

279.0

192.6

183.4

195.8

126.9

127.4

—

39.9

41.7

(126.9

)

(127.4

)

502.3

430.1

Reimbursable revenues

11.0

5.0

120

13.8

14.4

—

12.1

15.9

(24

—

36.9

35.3

Total operating revenues

290.0

197.6

197.2

210.2

126.9

127.4

—

52.0

57.6

(10

(126.9

)

(127.4

)

539.2

465.4

Operating expenses

Contract drilling expenses (exclusive of depreciation and reimbursable expenses)

167.9

150.6

(11

143.9

128.8

(12

71.6

75.1

27.4

22.7

(21

(30.4

)

(36.8

)

380.4

340.4

(12

Reimbursable expenses

10.5

4.9

(114

12.7

13.2

—

11.9

14.9

—

35.1

33.0

Total contract drilling expenses (exclusive of depreciation)

178.4

155.5

(15

156.6

142.0

(10

71.6

75.1

39.3

37.6

(30.4

)

(36.8

)

415.5

373.4

(11

Depreciation

17.2

15.7

(10

16.2

16.5

22.0

24.9

6.1

6.2

(16.9

)

(20.6

)

44.6

42.7

General and admin.

—

10.6

7.1

(49

—

16.6

18.2

27.2

25.3

Merger and integration expenses

—

11.4

13.6

11.4

13.6

Other operating income

—

(2.8

)

—

(2.8

)

Total operating expenses

195.6

168.4

(16

172.8

158.5

104.2

107.1

45.4

43.8

(19.3

)

(25.6

)

498.7

452.2

(10

Equity in earnings of ARO

—

10.6

6.8

10.6

6.8

Operating income

94.4

29.2

223

24.4

51.7

(53

22.7

20.3

6.6

13.8

(52

(97.0

)

(95.0

)

51.1

20.0

156

Net income (loss)

94.1

28.3

233

60.7

51.6

14.8

7.4

100

7.9

14.6

(46

(130.5

)

(119.9

)

47.0

(18.0

)

Adjusted EBITDA

111.6

42.1

165

40.6

68.2

(40

44.7

45.2

12.7

20.0

(37

(113.1

)

(108.8

)

96.5

66.7

nm - Not meaningful

(1) The full operating results included above for ARO are not included within our consolidated results and thus are deducted under "Reconciling Items" and replaced with our equity in earnings of ARO.

(2) Our onshore support costs included within contract drilling expenses are not allocated to our operating segments for purposes of measuring segment operating income (loss) and as such, these costs are included in "Reconciling Items." Further, general and administrative expense, depreciation expense and merger and integration expenses incurred by our corporate office are not allocated to our operating segments for purposes of measuring segment operating income (loss) and are included in "Reconciling Items."

Conference Call

In connection with the pending business combination with Transocean Ltd., announced on February 9, 2026, Valaris does not intend to hold future earnings conference calls or provide updates to forward-looking guidance.

About Valaris Limited

Valaris Limited (NYSE: VAL) is an industry leader in offshore drilling services across all water depths and geographies. Operating a high-quality rig fleet of ultra-deepwater drillships, versatile semisubmersibles, and modern shallow-water jackups, Valaris has experience operating in nearly every major offshore basin. Valaris maintains an unwavering commitment to safety, operational excellence, and customer satisfaction, with a focus on technology and innovation. Valaris Limited is a Bermuda exempted company limited by shares (Bermuda No. 56245). To learn more, visit the Valaris website at www.valaris.com.

Forward-Looking Statements

Statements contained in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include words or phrases such as "anticipate," "believe," "estimate," "expect," "intend," "likely," "outlook," "plan," "project," "could," "may," "might," "should," "will" and similar words and specifically include statements regarding expected financial performance; expected utilization, day rates, revenues, operating expenses, cash flows, contract status, terms and duration, contract backlog, capital expenditures, insurance, financing and funding; the offshore drilling market, including supply and demand, customer drilling programs and the attainment of requisite permits for such programs, stacking of rigs, effects of new rigs on the market and effect of the volatility of commodity prices; expected work commitments, awards, contracts and letters of intent; scheduled delivery dates for rigs; performance and expected benefits of our joint ventures, including our joint venture with Saudi Aramco; timing of the delivery of the Saudi Aramco Rowan Offshore Drilling Company ("ARO") newbuild rigs and the timing of additional ARO newbuild orders; the availability, delivery, mobilization, contract commencement, availability, relocation or other movement of rigs and the timing thereof; rig reactivations; suitability of rigs for future contracts; divestitures of assets; general economic, market, business and industry conditions, trends and outlook; general political conditions, including political tensions, conflicts and war; cybersecurity attacks and threats; uncertainty around the use and impacts of artificial intelligence applications; impacts and effects of public health crises, pandemics and epidemics; future operations; ability to renew expiring contracts or obtain new contracts; increasing regulatory complexity; targets, progress, plans and goals related to sustainability matters; the outcome of tax disputes; assessments and settlements; and expense management. The forward-looking statements contained in this press release are subject to numerous risks, uncertainties and assumptions that may cause actual results to vary materially from those indicated, including risks associated with the pending transaction with Transocean Ltd., including, among others, the completion of the pending transaction on the anticipated terms and timing, or at all, the risk that disruptions from the transaction will harm our business, including current plans and operations, the diversion of management's time and attention from ordinary course operations to completion of the pending transaction and certain restrictions during the pendency of the transaction that may impact our business; cancellation, suspension, renegotiation or termination of drilling contracts and programs; our ability to obtain financing, service our debt, fund capital expenditures and pursue other business opportunities; adequacy of sources of liquidity for us and our customers; future share repurchases; actions by regulatory authorities, or other third parties; actions by our security holders; internal control risk; commodity price fluctuations and volatility, customer demand, loss of a significant customer or customer contract, downtime and other risks associated with offshore rig operations; adverse weather, including hurricanes; changes in worldwide rig supply; and demand, competition and technology; supply chain and logistics challenges; consumer preferences for alternative fuels and forecasts or expectations regarding the global energy transition; increased scrutiny of our sustainability targets, initiatives and reporting and our ability to achieve such targets or initiatives; changes in customer strategy; future levels of offshore drilling activity; governmental action, civil unrest and political and economic uncertainties, including recessions, inflation, volatility affecting financial markets and the banking system, changing tariff policies, trade disputes, and adverse changes in the level of international trade activity; terrorism, piracy and military action (including conflicts in the Middle East and potential disruptions to key shipping lanes such as the Strait of Hormuz); risks inherent to shipyard upgrade, repair, maintenance, enhancement or rig reactivation; our ability to enter into, and the terms of, future drilling contracts; suitability of rigs for future contracts; the cancellation of letters of intent or letters of award or any failure to execute definitive contracts following announcements of letters of intent, letters of award or other expected work commitments; the outcome of litigation, legal proceedings, investigations or other claims or contract disputes; governmental regulatory, legislative and permitting requirements affecting drilling operations; our ability to attract and retain skilled personnel on commercially reasonable terms; the use of artificial intelligence by us, third-party service providers or our competitors; environmental or other liabilities, risks or losses; compliance with our debt agreements and debt restrictions that may limit our liquidity and flexibility, including in any return of capital plans; cybersecurity risks and threats; and changes in foreign currency exchange rates. In addition to the numerous factors described above, you should also carefully read and consider "Item 1A. Risk Factors" in Part I and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II of our most recent annual report on Form 10-K, which is available on the Securities and Exchange Commission's website at www.sec.gov or on the Investor Relations section of our website at www.valaris.com. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to update or revise any forward-looking statements, except as required by law.

VALARIS LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

OPERATING REVENUES

Revenues (exclusive of reimbursable revenues)

502.3

430.1

502.2

555.6

572.3

Reimbursable revenues

36.9

35.3

35.2

40.1

42.9

Total operating revenues

539.2

465.4

537.4

595.7

615.2

OPERATING EXPENSES

Contract drilling expenses (exclusive of depreciation and reimbursable expenses)

380.4

340.4

380.3

367.6

355.2

Reimbursable expenses

35.1

33.0

33.1

38.0

40.5

Total contract drilling expenses (exclusive of depreciation)

415.5

373.4

413.4

405.6

395.7

Depreciation

44.6

42.7

40.6

37.1

35.5

General and administrative

27.2

25.3

27.0

26.9

18.8

Merger and integration expenses

11.4

13.6

—

Other operating (income) loss

—

(2.8

)

19.5

—

Total operating expenses

498.7

452.2

500.5

469.6

450.0

EQUITY IN EARNINGS (LOSSES) OF ARO

10.6

6.8

2.5

4.4

(1.1

)

OPERATING INCOME

51.1

20.0

39.4

130.5

164.1

OTHER INCOME (EXPENSE)

Interest income

16.3

17.0

18.7

22.6

15.1

Interest expense, net

(24.0

)

(24.3

)

(24.8

)

(24.9

)

(24.8

)

Other, net

37.2

(2.3

)

3.1

87.7

(8.7

)

Total other income (expense)

29.5

(9.6

)

(3.0

)

85.4

(18.4

)

INCOME BEFORE INCOME TAXES

80.6

10.4

36.4

215.9

145.7

PROVISION (BENEFIT) FOR INCOME TAXES

33.6

28.4

(680.4

)

28.6

31.5

NET INCOME (LOSS)

47.0

(18.0

)

716.8

187.3

114.2

NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

3.4

1.6

0.7

0.8

0.9

NET INCOME (LOSS) ATTRIBUTABLE TO VALARIS

50.4

(16.4

)

717.5

188.1

115.1

EARNINGS (LOSS) PER SHARE

Basic

0.73

(0.24

)

10.32

2.66

1.62

Diluted

0.72

(0.24

)

10.26

2.65

1.61

WEIGHTED-AVERAGE SHARES OUTSTANDING

Basic

69.3

69.2

69.5

70.7

71.1

Diluted

70.4

69.2

69.9

71.0

71.3

VALARIS LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

As of

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

ASSETS

CURRENT ASSETS

Cash and cash equivalents

541.2

578.3

599.4

662.7

503.4

Accounts receivable, net

458.1

447.9

474.8

513.7

554.2

Assets held for sale

2.0

9.2

6.4

—

Other current assets

197.4

169.5

144.7

167.2

169.8

Total current assets

1,198.7

1,204.9

1,225.3

1,343.6

1,227.4

PROPERTY AND EQUIPMENT, NET

2,233.8

2,165.0

2,088.8

2,034.4

2,021.6

LONG-TERM NOTES RECEIVABLE FROM ARO

357.2

351.1

345.0

314.7

308.5

INVESTMENT IN ARO

139.2

128.6

121.8

119.3

114.9

DEFERRED TAX ASSETS

1,345.3

1,355.5

1,364.2

673.9

675.5

OTHER ASSETS

174.2

158.6

159.7

152.1

155.4

Total assets

5,448.4

5,363.7

5,304.8

4,638.0

4,503.3

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES

Accounts payable - trade

416.0

398.5

348.2

327.1

332.3

Accrued liabilities and other

358.8

379.2

343.4

390.9

346.4

Total current liabilities

774.8

777.7

691.6

718.0

678.7

LONG-TERM DEBT

1,087.6

1,086.8

1,086.0

1,085.2

1,084.3

DEFERRED TAX LIABILITIES

31.5

30.5

29.7

27.0

29.4

OTHER LIABILITIES

336.7

307.0

325.8

357.2

377.6

TOTAL LIABILITIES

2,230.6

2,202.0

2,133.1

2,187.4

2,170.0

TOTAL EQUITY

3,217.8

3,161.7

3,171.7

2,450.6

2,333.3

Total liabilities and shareholders' equity

5,448.4

5,363.7

5,304.8

4,638.0

4,503.3

VALARIS LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Six Months Ended June 30,

2026

2025

OPERATING ACTIVITIES

Net income

29.0

75.0

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation expense

87.3

68.6

Net gain on sale of property

(36.1

)

(27.9

)

Deferred income tax expense

20.7

173.3

Equity in earnings of ARO

(17.4

)

(1.5

)

Share-based compensation expense

15.6

11.6

Accretion of discount on Notes Receivable from ARO

(12.2

)

(12.3

)

Recovery of bad debt expense

(11.4

)

(0.1

)

Other operating (income) loss

(2.8

)

7.8

Changes in deferred costs

(30.2

)

4.3

Changes in contract assets

(7.5

)

(0.3

)

Changes in contract liabilities

6.9

(33.4

)

Other

1.9

4.5

Changes in operating assets and liabilities

51.7

14.6

Contributions to pension plans and other post-retirement benefits

(7.4

)

(8.3

)

Net cash provided by operating activities

88.1

275.9

INVESTING ACTIVITIES

Additions to property and equipment

(206.4

)

(167.4

)

Proceeds from disposition of assets

60.3

27.6

Net cash used in investing activities

(146.1

)

(139.8

)

FINANCING ACTIVITIES

Other

(1.5

)

(0.4

)

Net cash used in financing activities

(1.5

)

(0.4

)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH

(59.5

)

135.7

CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD (1)

617.5

380.5

CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (1)

558.0

516.2

Restricted cash balances were $16.8 million, $18.1 million, $12.8 million, $12.3 million as of June 30, 2026, December 31, 2025, June 30, 2025, and December 31, 2024, respectively.

VALARIS LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

OPERATING ACTIVITIES

Net income (loss)

47.0

(18.0

)

716.8

187.3

114.2

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation expense

44.6

42.7

40.6

37.1

35.5

Net (gain) loss on sale of property

(37.7

)

1.6

(1.2

)

(89.5

)

(0.8

)

Deferred income tax expense (benefit)

11.2

9.5

(687.6

)

(0.8

)

3.5

Recovery of bad debt expense

(11.1

)

(0.3

)

(0.3

)

(0.5

)

(0.1

)

Equity in losses (earnings) of ARO

(10.6

)

(6.8

)

(2.5

)

(4.4

)

1.1

Share-based compensation expense

9.2

6.4

6.8

6.0

Accretion of discount on Notes Receivable from ARO

(6.1

)

(6.1

)

(6.2

)

(6.2

)

(6.2

)

Other operating (income) loss

—

(2.8

)

19.5

—

Changes in deferred costs

(7.4

)

(22.8

)

7.0

4.8

4.5

Changes in contract liabilities

6.5

0.4

(1.7

)

(5.9

)

(15.6

)

Changes in contract assets

(0.6

)

(6.9

)

(4.7

)

(5.3

)

0.1

Other

0.8

1.1

2.2

Changes in operating assets and liabilities

(28.6

)

80.3

(13.0

)

77.3

(21.1

)

Contributions to pension plans and other post-retirement benefits

(4.1

)

(3.3

)

(3.5

)

(4.8

)

(3.3

)

Net cash provided by operating activities

13.1

75.0

72.2

198.1

120.0

INVESTING ACTIVITIES

Additions to property and equipment

(105.5

)

(100.9

)

(106.3

)

(69.8

)

(67.2

)

Proceeds from disposition of assets

55.1

5.2

1.6

108.7

9.8

Net cash provided by (used in) investing activities

(50.4

)

(95.7

)

(104.7

)

38.9

(57.4

)

FINANCING ACTIVITIES

Payments related to tax withholdings for share-based awards

(0.1

)

(1.4

)

(0.5

)

(2.7

)

(0.1

)

Payments for share repurchases

—

(25.0

)

(75.0

)

—

Net cash used in financing activities

(0.1

)

(1.4

)

(25.5

)

(77.7

)

(0.1

)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH

(37.4

)

(22.1

)

(58.0

)

159.3

62.5

CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD (1)

595.4

617.5

675.5

516.2

453.7

CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (1)

558.0

595.4

617.5

675.5

516.2

Restricted cash balances were $16.8 million, $17.1 million, $18.1 million, $12.8 million, $12.8 million, and $12.3 million as of June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, June 30, 2025, and March 31, 2025, respectively.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(In millions)

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

REVENUES

Floaters

Drillships

279.0

192.6

231.1

253.8

282.7

Semisubmersibles

—

24.3

39.2

37.0

279.0

192.6

255.4

293.0

319.7

Reimbursable Revenues (1)

11.0

5.0

10.5

9.9

7.2

Total Floaters

290.0

197.6

265.9

302.9

326.9

Jackups

Harsh Environment

89.9

96.0

98.2

110.5

115.0

Benign Environment

74.1

80.9

91.5

91.2

81.4

Legacy

19.4

18.9

19.1

15.0

15.6

183.4

195.8

208.8

216.7

212.0

Reimbursable Revenues (1)

13.8

14.4

15.3

20.4

26.0

Total Jackups

197.2

210.2

224.1

237.1

238.0

Other

Leased and Managed Rigs

39.9

41.7

38.0

45.9

40.6

Reimbursable Revenues (1)

12.1

15.9

9.4

9.8

9.7

Total Other

52.0

57.6

47.4

55.7

50.3

Total Operating Revenues

539.2

465.4

537.4

595.7

615.2

Total Reimbursable Revenues (1)

36.9

35.3

35.2

40.1

42.9

Revenues Exclusive of Reimbursable Revenues

502.3

430.1

502.2

555.6

572.3

Reimbursable revenues represent reimbursements from our customers for purchases of supplies, equipment and incremental services provided at their request.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(In millions)

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

ADJUSTED EBITDA (1)

Floaters

Drillships

114.3

43.8

60.4

94.7

137.3

Semisubmersibles

(2.7

)

(1.7

)

(2.0

)

11.1

6.6

111.6

42.1

58.4

105.8

143.9

Jackups

Harsh Environment

32.0

35.4

38.6

48.8

49.4

Benign Environment

1.6

26.2

43.2

43.0

36.3

Legacy

7.0

6.6

7.7

1.6

3.7

40.6

68.2

89.5

93.4

89.4

Total

152.2

110.3

147.9

199.2

233.3

Other

Leased and Managed Rigs

12.7

20.0

17.2

29.7

23.4

Total

164.9

130.3

165.1

228.9

256.7

Support costs

General and administrative expense

27.2

25.3

27.0

26.9

18.8

Onshore support costs

41.2

38.3

41.1

38.8

37.2

68.4

63.6

68.1

65.7

56.0

Valaris Total

96.5

66.7

97.0

163.2

200.7

Adjusted EBITDA is earnings before interest, tax, depreciation, other operating (income) loss, (gain) loss on sale of assets, merger and integration expenses and equity in (earnings) losses of ARO. Adjusted EBITDA for asset categories also excludes onshore support costs and general and administrative expenses.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(In millions)

(Unaudited)

As of

Aug 5,

2026

May 4,

2026

Feb 17,

2026

Oct 23,

2025

Jul 24,

2025

CONTRACT BACKLOG (1)

Floaters

Drillships

3,016.3

3,319.8

3,030.8

2,617.8

2,708.8

Semisubmersibles

—

7.3

35.4

3,016.3

3,319.8

3,030.8

2,625.1

2,744.2

Jackups

Harsh Environment

430.5

350.1

367.2

525.3

532.1

Benign Environment

615.7

687.2

645.2

601.0

673.2

Legacy

87.2

98.3

113.4

136.6

148.5

1,133.4

1,135.6

1,125.8

1,262.9

1,353.8

Total

4,149.7

4,455.4

4,156.6

3,888.0

4,098.0

Other

Leased and Managed Rigs

435.5

473.7

515.7

562.3

616.4

Valaris Total

4,585.2

4,929.1

4,672.3

4,450.3

4,714.4

Our contract drilling backlog reflects commitments, represented by signed drilling contracts, and is calculated by multiplying the contracted day rate by the contract period. Contract drilling backlog may include drilling contracts subject to final investment decision ("FID") and drilling contracts which grant the customer termination rights if FID is not received with respect to projects for which the drilling rig is contracted. The contracted day rate excludes certain types of lump sum fees for rig mobilization, demobilization, contract preparation, as well as customer reimbursables and bonus opportunities.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

AVERAGE DAILY REVENUE (1)

Floaters

Drillships

451,000

436,000

434,000

425,000

410,000

Semisubmersibles

—

267,000

229,000

231,000

451,000

436,000

409,000

380,000

377,000

Jackups

Harsh Environment

128,000

134,000

146,000

148,000

153,000

Benign Environment

153,000

147,000

142,000

143,000

144,000

Legacy

107,000

105,000

104,000

100,000

88,000

134,000

135,000

139,000

141,000

142,000

Total

233,000

207,000

218,000

220,000

227,000

Other

Leased and Managed Rigs

53,000

66,000

53,000

55,000

50,000

Valaris Total

189,000

171,000

177,000

176,000

181,000

Average daily revenue is derived by dividing Revenues (exclusive of reimbursable revenues), excluding contract termination fees, by the aggregate number of operating days.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

UTILIZATION - TOTAL FLEET (1)

Floaters

Drillships

Semisubmersibles

—

Jackups

Harsh Environment

Benign Environment

Legacy

100

Total

Other

Leased and Managed Rigs

100

Valaris Total

Pro Forma Jackups (2)

Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the total fleet. Available days is defined as the maximum number of days available in the period for the total fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, irrespective of asset status.

Includes all Valaris jackups including those leased to ARO Drilling.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

UTILIZATION - ACTIVE FLEET (1) (2)

Floaters

Drillships

Semisubmersibles

—

Jackups

Harsh Environment

100

Benign Environment

100

Legacy

100

Total

Other

Leased and Managed Rigs

100

Valaris Total

Pro Forma Jackups (3)

Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the active fleet. Available days is defined as the maximum number of days available in the period for the active fleet, calculated by multiplying the number of active rigs in each asset category by the number of days in the period.

Active fleet represents rigs that are not preservation stacked or held for sale and includes rigs that are in the process of being reactivated.

Includes all Valaris jackups including those leased to ARO Drilling.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

OPERATING DAYS (1)

Floaters

Drillships

619

442

533

579

689

Semisubmersibles

—

171

160

619

442

624

750

849

Jackups

Harsh Environment

725

714

690

748

753

Benign Environment

484

549

643

638

566

Legacy

182

180

184

150

178

1,391

1,443

1,517

1,536

1,497

Total

2,010

1,885

2,141

2,286

2,346

Other

Leased and Managed Rigs

637

630

714

828

819

Total

2,647

2,515

2,855

3,114

3,165

Represents the total number of days under contract in the period. Days under contract equals the total number of days that rigs have earned and recognized day rate revenue, including days associated with compensated downtime and mobilizations. When revenue is deferred and amortized over a future period, for example when we receive fees while mobilizing to commence a new contract or while being upgraded in a shipyard, the related days are excluded from days under contract.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

REVENUE EFFICIENCY (1)

Floaters

Drillships

Semisubmersibles

—

100

Jackups

Harsh Environment

100

Benign Environment

100

Legacy

100

Total

Revenue efficiency is day rate revenue earned as a percentage of maximum potential day rate revenue.

VALARIS LIMITED AND SUBSIDIARIES

OPERATING STATISTICS

(Unaudited)

As of

NUMBER OF RIGS

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

Active Fleet (1)

Floaters

Drillships

Semisubmersibles

Jackups

Harsh Environment

Benign Environment

Legacy

Total Active Fleet

Stacked Fleet

Drillships

Jackups

Harsh Environment

Benign Environment (2)

Total Stacked Fleet

Held For Sale

Benign Environment (3)

—

Semisubmersibles (4)

—

Total Held For Sale

—

Leased Rigs (5)

Jackups

Harsh Environment

Benign Environment

Total Leased Rigs

Total

Managed Rigs (5)

Active fleet represents rigs that are not preservation stacked or held for sale and includes rigs that are in the process of being reactivated.

During the three months ended June 30, 2026, VALARIS 104 was sold and VALARIS 109 was classified as held for sale.

Represents VALARIS 109, which was classified as held for sale as of June 30, 2026.

Represents VALARIS DPS-1, which was classified as held for sale as of March 31, 2026 and December 31, 2025, and subsequently sold in April 2026.

Leased rigs and managed rigs included in Other reporting segment.

ARO DRILLING

CONDENSED INCOME STATEMENT INFORMATION

(In millions)

(Unaudited)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

Revenues

126.9

127.4

139.6

156.8

139.9

Operating expenses

Contract drilling expenses (exclusive of depreciation)

71.6

75.1

87.1

91.6

96.4

Depreciation

22.0

24.9

28.3

28.4

28.7

General and administrative

10.6

7.1

10.4

5.5

6.6

Operating income

22.7

20.3

13.8

31.3

8.2

Other expense, net

11.2

12.9

14.5

14.3

15.5

Provision (benefit) for income taxes

(3.3

)

—

0.7

14.6

1.3

Net income (loss)

14.8

7.4

(1.4

)

2.4

(8.6

)

Adjusted EBITDA

44.7

45.2

42.1

59.7

36.9

ARO Drilling condensed income statement information presented above represents 100% of ARO. Valaris has a 50% ownership interest in ARO.

ARO DRILLING

OPERATING STATISTICS

(Unaudited)

As of

(In millions)

Aug 5,

2026

May 4,

2026

Feb 17,

2026

Oct 23,

2025

Jul 24,

2025

CONTRACT BACKLOG (1)

Owned Rigs

713.9

753.1

778.0

879.9

970.1

Leased Rigs

1,120.2

1,163.6

1,233.3

1,284.7

1,379.2

Total

1,834.1

1,916.7

2,011.3

2,164.6

2,349.3

Contract drilling backlog reflects commitments, represented by signed drilling contracts, and is calculated by multiplying the contracted day rate by the contract period. The contracted day rate excludes certain types of lump sum fees for rig mobilization, demobilization, contract preparation, as well as customer reimbursables and bonus opportunities.

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

AVERAGE DAILY REVENUE (1)

Owned Rigs

115,000

111,000

112,000

107,000

Leased Rigs (2)

110,000

114,000

116,000

126,000

122,000

Total

113,000

112,000

113,000

118,000

113,000

UTILIZATION (3)

Owned Rigs

Leased Rigs (2)

Total

REVENUE EFFICIENCY (4)

Owned Rigs

100

Leased Rigs (2)

Total

NUMBER OF RIGS (AT QUARTER END)

Owned Rigs

Leased Rigs (2)

Total

OPERATING DAYS (5)

Owned Rigs

681

710

778

792

761

Leased Rigs (2)

435

430

455

532

481

Total

1,116

1,140

1,233

1,324

1,242

Average daily revenue is derived by dividing Revenues (exclusive of reimbursable revenues), excluding contract termination fees, by the aggregate number of operating days.

All ARO leased rigs are leased from Valaris.

Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the rig fleet.

Revenue efficiency is day rate revenue earned as a percentage of maximum potential day rate revenue.

Non-GAAP Financial Measures (Unaudited)

To supplement Valaris’ condensed consolidated financial statements presented on a GAAP basis, this press release provides investors with Adjusted EBITDA, which is a non-GAAP measure.

Valaris defines "Adjusted EBITDA" as net income (loss) before income tax expense, interest expense, other (income) expense, depreciation expense, other operating (income) loss, (gain) loss on sale of property, merger and integration expenses, and equity in (earnings) losses of ARO. Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of our core operating performance and makes it easier to compare our results with those of other companies within our industry. Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities, or (c) as a measure of liquidity. Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies.

Valaris defines "ARO Adjusted EBITDA" as ARO's net income (loss) before income tax expense, other expense, net, and depreciation expense. ARO Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of ARO's core operating performance and to evaluate ARO's long-term financial performance against that of ARO's peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of ARO's core operating performance and makes it easier to compare ARO's results with those of other companies within ARO's industry. ARO Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities, or (c) as a measure of liquidity. ARO Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies.

Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

Reconciliation of Net Income (Loss) to Adjusted EBITDA

A reconciliation of net income (loss) as reported to Adjusted EBITDA is included in the tables below (in millions):

Three Months Ended

Jun 30,

2026

Mar 31,

2026

VALARIS

Net income (loss)

47.0

(18.0

)

Add (subtract):

Income tax expense

33.6

28.4

Interest expense, net

24.0

24.3

Net (gain) loss on sale of property

(37.7

)

1.6

Other income

(15.8

)

(16.3

)

Operating income

51.1

20.0

Add (subtract):

Depreciation

44.6

42.7

Merger and integration expenses

11.4

13.6

Other operating income (1)

—

(2.8

)

Equity in earnings of ARO

(10.6

)

(6.8

)

Adjusted EBITDA

96.5

66.7

Other operating income represents non-cash gains on remeasurement of assets classified as held for sale. During the three months ended March 31, 2026, we recognized a $2.8 million gain on remeasurement of VALARIS DPS-1.

A reconciliation of net income as reported to ARO Adjusted EBITDA is included in the tables below (in millions):

Three Months Ended

Jun 30,

2026

Mar 31,

2026

ARO

Net income

14.8

7.4

Add (subtract):

Income tax expense (benefit)

(3.3

)

—

Other expense, net

11.2

12.9

Operating income

22.7

20.3

Add:

Depreciation expense

22.0

24.9

Adjusted EBITDA

44.7

45.2

Reconciliation of Net Income to Adjusted EBITDA

(In millions)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

FLOATERS

Net income

94.1

28.3

Add:

Other expense

0.3

0.9

Operating income

94.4

29.2

Add (subtract):

Depreciation

17.2

15.7

Other operating income (1)

—

(2.8

)

Adjusted EBITDA

111.6

42.1

JACKUPS

Net income

60.7

51.6

Add:

Net gain on sale of property

(36.3

)

—

Other (income) expense

—

0.1

Operating income

24.4

51.7

Add:

Depreciation

16.2

16.5

Adjusted EBITDA

40.6

68.2

OTHER

Net income

7.9

14.6

Subtract:

Other income

(1.3

)

(0.8

)

Operating income

6.6

13.8

Add:

Depreciation

6.1

6.2

Adjusted EBITDA

12.7

20.0

Reconciliation of Net Income (Loss) to Adjusted EBITDA

(In millions)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

DRILLSHIPS

Net income

97.7

28.5

45.5

80.3

123.4

Add:

Other expense

—

0.3

—

0.3

0.5

Operating income

97.7

28.8

45.5

80.6

123.9

Add:

Depreciation

16.6

15.0

14.9

14.1

13.4

Adjusted EBITDA (1)

114.3

43.8

60.4

94.7

137.3

SEMISUBMERSIBLES

Net income (loss)

(3.6

)

(0.2

)

(19.1

)

9.7

5.4

Add:

Other expense

0.3

0.6

—

Operating income (loss)

(3.3

)

0.4

(19.1

)

9.7

5.4

Add (subtract):

Depreciation

0.6

0.7

1.3

1.4

1.2

Other operating (income) loss (2)

—

(2.8

)

15.8

—

Adjusted EBITDA (1)

(2.7

)

(1.7

)

(2.0

)

11.1

6.6

(1)

Adjusted EBITDA for asset categories excludes onshore support costs, general and administrative expenses and merger and integration expenses.

(2)

Other operating (income) loss represents non-cash impairment losses and gains on remeasurement of assets classified as held for sale. During the three months ended March 31, 2026, we recognized a $2.8 million gain on remeasurement of VALARIS DPS-1. During the three months ended December 31, 2025, we recognized $15.8 million of non-cash impairment losses in connection with the classification of VALARIS DPS-1 as held for sale.

Reconciliation of Net Income (Loss) to Adjusted EBITDA

(In millions)

Three Months Ended

Jun 30,

2026

Mar 31,

2026

Dec 31,

2025

Sep 30,

2025

Jun 30,

2025

HARSH ENVIRONMENT JACKUPS

Net income

23.8

27.2

29.3

130.5

42.2

Add (subtract):

Net (gain) loss on sale of property

0.3

—

(88.4

)

—

Other (income) expense

—

0.1

(0.1

)

(0.4

)

(0.1

)

Operating income

24.1

27.3

29.2

41.7

42.1

Add:

Depreciation

7.9

8.1

7.7

7.1

7.3

Other operating loss (1)

—

1.7

—

Adjusted EBITDA (2)

32.0

35.4

38.6

48.8

49.4

BENIGN ENVIRONMENT JACKUPS

Net income

32.5

20.4

35.5

37.4

31.7

Subtract:

Net gain on sale of property

(36.6

)

—

Other income

—

(0.2

)

Operating income (loss)

(4.1

)

20.4

35.5

37.4

31.5

Add:

Depreciation

5.7

5.8

5.7

5.6

4.8

Other operating loss (1)

—

2.0

—

Adjusted EBITDA (2)

1.6

26.2

43.2

43.0

36.3

LEGACY JACKUPS

Net income (loss)

4.4

4.0

5.1

(1.0

)

1.2

Operating income (loss)

4.4

4.0

5.1

(1.0

)

1.2

Add:

Depreciation

2.6

2.5

Adjusted EBITDA (2)

7.0

6.6

7.7

1.6

3.7

Other operating loss for the three months ended December 31, 2025 represents non-cash impairment losses of $1.7 million and $2.0 million recognized in connection with the retirements of VALARIS 102, a harsh environment jackup, and VALARIS 145, a benign environment jackup, respectively.

Adjusted EBITDA for asset categories excludes onshore support costs, general and administrative expenses and merger and integration expenses.