Q4 2025 Noble Corp PLC Earnings Call

February 12, 2026

Operator 2: Thank you for standing by. My name is Carrie, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Noble Corporation Fourth Quarter 2025 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question during this time, simply press Star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press Star one again. Thank you. I would now like to turn the call over to Mr. Ian Macpherson. You may begin.

Speaker #1: All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad.

Speaker #1: If you would like to withdraw your question, please press star 1 again. Thank you. I would now like to turn the call over to Mr. Ian MacPherson.

Speaker #1: You may begin.

Speaker #2: Thank you, operator, and welcome everyone to Noble Corp's 4th Quarter 2025 earnings conference call. You can find a copy of our earnings report along with the supporting statements and schedules on our website at noblecorp.com.

Ian Macpherson: Thank you, operator, and welcome everyone to Noble Corporation's Q4 2025 earnings conference call. You can find a copy of our earnings report, along with the supporting statements and schedules, on our website at noblecorp.com. We will reference an earnings presentation that's posted in the investor relations page of our website. Today's call will feature prepared remarks from our President and CEO, Robert Eifler, as well as our CFO, Richard Barker. We also have with us Blake Denton, Senior Vice President of Marketing and Contracts, and Joey Kawaja, Senior Vice President of Operations. During the course of this call, we may make certain forward-looking statements regarding various matters relating to our business and companies that are not historical facts. Such statements are based upon current expectations and assumptions of management and are therefore subject to certain risks and uncertainties.

Speaker #2: We will reference an earnings presentation that's posted in the Investor Relations page of our website. Today's call will feature prepared remarks from our president and CEO, Robert Eifler, as well as our CFO, Richard Barker.

Speaker #2: We also have with us Blake Denton, Senior Vice President of Marketing and Contracts, and Julie Kalaja, Senior Vice President of Operations. During the course of this call, we may make certain forward-looking statements regarding various matters related to our business and companies that are not historical facts.

Speaker #2: Such statements are based upon current expectations and assumptions of management and are therefore subject to certain risks and uncertainties. Many factors could cause actual results to differ materially from these forward-looking statements, and Noble does not assume any obligation to update these statements.

Ian Macpherson: Many factors could cause actual results to differ materially from these forward-looking statements, and Noble does not assume any obligation to update these statements. Also note, we are referencing non-GAAP financial measures on the call today. You can find the required supplemental disclosure for these measures, including the most directly comparable GAAP measure and an associated reconciliation in our earnings report issued yesterday and filed with the SEC. Now I'll turn the call over to Robert Eifler, President and CEO of Noble.

Speaker #2: Also note, we are referencing non-GAAP financial measures on the call today, you can find the required supplemental disclosure for these measures, including the most directly comparable GAAP measure and an associated reconciliation in our earnings report issued yesterday and filed with the SEC.

Speaker #2: Now I'll turn the call over to Robert Eifler. President and CEO of Noble.

Speaker #3: Thanks, Ian. Welcome, everyone, and thank you for joining us. Today I'll walk through our financial and operational highlights, recent commercial wins, market outlook, including our semi-annual review of Deepwater rig demand around the world, and a brief update on our fleet strategy.

Robert Eifler: Thanks, Ian. Welcome, everyone, and thank you for joining us. Today, I'll walk through our financial and operational highlights, recent commercial wins, market outlook, including our semi-annual review of deepwater rig demand around the world... and a brief update on our fleet strategy. Richard will then provide a financial overview, and I'll wrap up with closing remarks before we go to Q&A. Starting with Q4, we reported Adjusted EBITDA of $232 million and free cash flow of $35 million, bringing Adjusted EBITDA for the full year 2025 slightly above the $1.1 billion midpoint of our original guidance. We have maintained our return of capital program, returning an additional $80 million to shareholders through our $0.50 per share quarterly dividend in Q4. Yesterday, our board declared a $0.50 per share dividend for the current quarter.

Speaker #3: Richard will then provide a financial overview, and I'll wrap up with closing remarks before we go to Q&A. Starting with Q4, we reported adjusted EBITDA of $232 million, and free cash flow of $35 million.

Speaker #3: Bringing adjusted EBITDA for the full year 2025 slightly above the $1.1 billion midpoint of our original guidance. We have maintained our return of capital program, returning an additional $80 million to shareholders through our 50 cent per share quarterly dividend in Q4.

Speaker #3: Yesterday, our board declared a 50 cent per share dividend for the current quarter. Turning to the commercial highlights, we've continued to see strong booking levels across our fleet.

Robert Eifler: Turning to the commercial highlights, we've continued to see strong booking levels across our fleet, with backlog increasing to $7.5 billion. First, the Noble GreatWhite has been awarded a three-year contract with Aker BP in Norway, valued at $473 million, including mobilization, but excluding additional fees for integrated services and bonus potential. This marks the GreatWhite's first campaign in Norway and represents a significant step in expanding our presence on the Norwegian Continental Shelf and deepening our important relationship with Aker BP. We expect CapEx of approximately $160 million for the rig's reactivation, Norwegian certification, and contract preparation.

Speaker #3: With backlog increasing to $7.5 billion, first, the Noble Great White has been awarded a three-year contract with Ochre BP in Norway, valued at $473 million, including mobilization, but excluding additional fees for integrated services and bonus potential.

Speaker #3: This marks the Great White's first campaign in Norway, and represents a significant step in expanding our presence on the Norwegian continental shelf, and deepening our important relationship with Ochre BP.

Speaker #3: We expect CapEx of approximately $160 million for the rig's reactivation, Norwegian certification, and contract preparation. This is a highly strategic investment with a compelling return profile, as we anticipate total EBITDA potential of approximately $240 million, over the three-year contract period.

Robert Eifler: This is a highly strategic investment with a compelling return profile, as we anticipate total EBITDA potential of approximately $240 million over the three-year contract period, essentially targeting a recovery of the capital in the first two years of the program and positioning the GreatWhite very well for the future as one of the most technically capable units in the Norway floater market. Of course, the access to the Norway market should result in a structural enhancement to the long-term earnings profile and NAV of the rig. Next, the Noble Jerry de Souza was awarded a two-year contract with Exxon in Nigeria. This contract, valued at $292 million, is scheduled to start around the middle of this year and is followed by three one-year options.

Speaker #3: Essentially targeting a recovery of the capital in the first two years of the program, and positioning the Great White very well for the future, as one of the most technically capable units in the Norway floater market.

Speaker #3: And of course, the access to the Norway market should result in a structural enhancement to the long-term earnings profile and NAV of the rig.

Speaker #3: Next, the Noble J's D'Souza was awarded a two-year contract with Exxon in Nigeria. This contract, valued at $292 million, is scheduled to start around the middle of this year, and is followed by three one-year options.

Speaker #3: We are looking forward to redeploying the D'Souza in Nigeria, following the rig's previous campaign there from 2023 to 2025. In the US Gulf, the Noble Black Rhino has recently been awarded one well plus one option well with Beacon.

Robert Eifler: We are looking forward to redeploying the De Souza in Nigeria following the rig's previous campaign there from 2023 to 2025. In the US Gulf, the Noble BlackRhino has recently been awarded one well plus one option well with Beacon. The firm well is an estimated 50-day workover set to start in March, and the option well is for an estimated 100 days of drilling work. Next, the Noble Developer received a 3-well contract with BP in Trinidad that's scheduled to commence in early 2027 at a day rate of $375,000, with estimated duration of 240 days, plus 3 option wells with similar duration.

Speaker #3: The firm well is an estimated 50-day workover set to start in March, and the option well is for an estimated $100 days of drilling work.

Speaker #3: Next, the Noble developer received a three well contract with BP in Trinidad that's scheduled to commence in early 2027, at a day rate of $375,000.

Speaker #3: With estimated duration of 240 days, plus three option wells with similar duration, as a side note, the developer has been made available for this contract, as the previously announced long-term contract with Total and Surinam scheduled to start later this year, has been reassigned to the Noble Discoverer.

Robert Eifler: As a side note, the Developer has been made available for this contract as the previously announced long-term contract with Total in Suriname, scheduled to start later this year, has been reassigned to the Noble Discoverer. Perhaps somewhat counterintuitively, our sixth-generation D-class semis actually began to realize an earlier demand recovery than some of the higher spec seventh-gen rigs, with both the Developer and Discoverer now booked out for a combined total of nearly five rig years. Additionally, the Deliverer looks well positioned for a good amount of work that's expected to start next year. Hopefully, we will have some positive news to report on the Deliverer before too long.

Speaker #3: Perhaps somewhat counterintuitively, our sixth-generation D-class semis actually began to realize an earlier demand recovery than some of the higher-spec seventh-gen rigs, with both the Developer and Discoverer now booked out for a combined total of nearly five rig years.

Speaker #3: Additionally, the deliverer looks well positioned for a good amount of work that's expected to start next year. Hopefully, we will have some positive news to report on the deliverer before too long.

Speaker #3: Staying in South America, the Noble endeavor has been awarded an 11 well contract with an undisclosed operator that's expected to commence late this year, with estimated duration of 18 months, at a rate of $300,000 per day.

Robert Eifler: Staying in South America, the Noble Endeavor has been awarded an 11-well contract with an undisclosed operator that's expected to commence late this year, with estimated duration of 18 months at a rate of $300,000 per day, plus mobilization and demobilization fees, and potential for performance bonus. Finally, in Southeast Asia, we have firmed up contracts for an additional 5 to 6 months of work this year through the expansion of existing work scopes plus 1 additional option well. So we now expect the Viking to be solid through July, with additional opportunities under discussion that would carry term for the rig through this year and beyond. Now on to the market outlook.

Speaker #3: Plus mobilization and demobilization fees, and potential for performance bonus. And finally, in Southeast Asia, we have firmed up contracts for an additional five to six months of work this year, through the expansion of existing work scopes, plus one additional option well.

Speaker #3: So we now expect the Viking to be solid through July, with additional opportunities under discussion that would carry term for the rig through this year and beyond.

Speaker #3: Now onto the market outlook. Despite the ongoing abundance of macro uncertainties and Brent prices hovering around five-year lows in recent months, between $60 and $70 per barrel, floater contracting activity has been resilient.

Robert Eifler: Despite the ongoing abundance of macro uncertainties and Brent prices hovering around 5-year lows in recent months between $60 and $70 per barrel, floater contracting activity has been resilient, underscoring our customers' multi-year planning horizon for their highly strategic deepwater assets. Including our recent contract awards, the contracted UDW rig count has now bounced back up to 105, up from a recent low of 97 early last year, and is closing in on the 2024 high watermark of 107 contracted UDW rigs. On this basis, the contracted utilization rate of the marketed fleet is 95%. That said, these figures all reflect the gross number of contracted rigs, including those which are currently idle but have contracts starting in the future.

Speaker #3: Underscoring our customers' multi-year planning horizon for their highly strategic Deepwater assets, including our recent contract awards, the contracted UDW rig count has now bounced back up to 105.

Speaker #3: Up from a recent low of 97 early last year, and is closing in on the 2024 high water mark of 107 contracted UDW rigs.

Speaker #3: On this basis, the contracted utilization rate of the marketed fleet is 95%. That said, these figures all reflect the gross number of contracted rigs, including those which are currently idle but have contracts starting in the future.

Speaker #3: Alternatively, the number of UDW rigs currently working under contract today is 90, which represents marketed utilization of 82% on a present basis, and of course gives rise to the soft day rates we've seen recently.

Robert Eifler: Alternatively, the number of UDW rigs currently working under contract today is 90, which represents marketed utilization of 82% on a present basis, and of course, gives rise to the soft day rates we've seen recently. These divergent utilization statistics tell us a couple of things. First, the industry fleet has added backlog depth but hasn't yet fully worked through the prompt White Space overhang. Second, the foundation has been set for a steadily improving activity level as we progress through this year and into 2027. Of note, six of the 14 rigs that sit idle today with future contracts in hand are Noble rigs: the Noble BlackRhino, Voyager, Valiant, GreatWhite, Jerry de Souza, and Endeavor. We believe this is a strong indicator of improving utilization on the come for the industry fleet, and especially the Noble fleet. More on this later.

Speaker #3: These divergent utilization statistics tell us a couple of things. First, the industry fleet has added backlog depth, but hasn't yet fully worked through the prompt white space overhang.

Speaker #3: And second, the foundation has been set for a steadily improving activity level as we progress through this year and into 2027. Of note, six of the 14 rigs that sit idle today with future contracts in hand are Noble rigs.

Speaker #3: The Noble Black Rhino, Voyager, Valiant, Great White, Jay D'Souza, and Endeavor. We believe this is a strong indicator of improving utilization to come for the industry fleet.

Speaker #3: And especially the Noble fleet. More on this later. Focusing on the near term, there are still about 25 UDW floaters with contracts expiring during the course of this year.

Robert Eifler: Focusing on the near term, there are still about 25 UDW floaters with contracts expiring during the course of this year. For context, this is essentially the same as the fleet's rollover profile in 2025 and does not cause concern. While this churn will still probably continue to result in some idle gaps this year, overall, the white space across the industry looks to be on the retreat. And if the overall contracting cadence remains on trend, then we would expect to see some convergence between the present and future utilization metrics. Against this firming, but not yet decisively tight backdrop, day rates for Tier One drillships have settled at around $400,000 per day, with lower spec units recently capturing low to high $300,000 per day.

Speaker #3: For context, this is essentially the same as the fleet's rollover profile in 2025, and does not cause concern. While this churn will still probably continue to result in some idle gaps this year, overall, the white space across the industry looks to be on the retreat.

Speaker #3: And if the overall contracting cadence remains on trend, then we would expect to see some convergence between the present and future utilization metrics. Against this firming but not yet decisively tight backdrop, day rates for tier one drill ships have settled at around $400,000 per day, with lower-spec units recently capturing low to high $300,000 per day.

Speaker #3: Geographically, the recent Deepwater demand trend has been characterized by steady strength in South America, a slight decrease in the US Gulf, and upticks throughout other regions including West Africa, the Med, and Black Sea, and Asia Pacific.

Robert Eifler: Geographically, the recent deepwater demand trend has been characterized by steady strength in South America, a slight decrease in the US Gulf, and upticks throughout other regions, including West Africa, the Med and Black Sea, and Asia Pacific. Starting first in South America, where contracted UDW demand stands at 44 total units, including 34 rigs in Brazil. Although Petrobras budget pressure has emerged as a near-term headwind, resulting in slower contract executions and ongoing blend and extend negotiations with contractors, including ourselves, thus far, this has been offset by increased demand from other operators, both within Brazil and elsewhere throughout the region. Later this year, the Noble Discoverer will wrap up its program in Colombia and is planned to commence its three-year campaign with Total in Suriname.

Speaker #3: Starting first in South America, where contracted UDW demand stands at 44 total units, including 34 rigs in Brazil. Although Petrobras' budget pressure has emerged as a near-term headwind, resulting in slower contract executions and ongoing blend and extend negotiations with contractors including ourselves, thus far, this has been offset by increased demand from other operators, both within Brazil and elsewhere throughout the region.

Speaker #3: Later this year, the Noble Discoverer will wrap up its program in Colombia, and it's planned to commence its three-year campaign with Total and Surinam.

Speaker #3: We remain in constructive dialogue with Petrobras regarding contract extensions, for either or both of our two Brazil rigs, the Noble Fake Kozak and Noble Courage.

Robert Eifler: We remain in constructive dialogue with Petrobras regarding contract extensions for either or both of our two Brazil rigs, the Noble Faye Kozack and Noble Courage. Overall, with Petrobras paring back activity by a few rigs over the short term, while other operators throughout the region are net adding, we would expect South America to remain roughly flat over the next year relative to today's record-high contracted UDW rig count of 44. US Gulf of Mexico has softened recently, with the Noble BlackRhino's recent contract award, bringing the contracted UDW rig count back up to 21, which is 1 to 2 rigs below last year's average level. We had predicted this slight pullback in the US Gulf of Mexico, and it appears now that this has more or less fully played out.

Speaker #3: Overall, with Petrobras paring back activity by a few rigs over the short term, while other operators throughout the region are net adding, we would expect South America to remain roughly flat over the next year relative to today's record-high contracted UDW rig count of 44.

Speaker #3: US Gulf has softened recently, with the Noble Black Rhinos' recent contract award bringing the contracted UDW rig count back up to 21. Which is one to two rigs below last year's average level.

Speaker #3: We had predicted this slight pullback in the US Gulf, and it appears now that this has more or less fully played out. Next, onto West Africa, where contracted UDW demand has recently rebounded to 15 rigs with the Noble Jerry D'Souza back under contract.

Robert Eifler: Next, on to West Africa, where contracted UDW demand has recently rebounded to 15 rigs with the Noble Jerry de Souza back under contract. This is an uptick from last year's trough demand level of 12, although there is still some variability to demand in this region, with a few rigs contracted into other regions later this year. The pipeline of open demand throughout Africa remains highly promising, including at least 5 active or pending long-term tenders throughout Angola, Nigeria, Côte d'Ivoire, Ghana, and Namibia, plus the potential for multiple additional rig lines in Mozambique over the next couple of years. So overall, the West Africa plus Mozambique region appears poised to grow into a mid to high teens UDW rig count as these various programs come online. The Mediterranean and Black Sea has been a growth pocket, partly due to the continued expansion of Turkish Petroleum's offshore ambitions.

Speaker #3: This is an uptick from last year's trough demand level of 12, although there are still some variability to demand in this region, with a few rigs contracted into other regions later this year.

Speaker #3: The pipeline of open demand throughout Africa remains highly promising. Including at least five active or pending long-term tenders throughout Angola, Nigeria, Côte d'Ivoire, Ghana, and Namibia, plus the potential for multiple additional rig lines in Mozambique, over the next couple of years.

Speaker #3: So overall, the West Africa plus Mozambique region appears poised to grow into a mid to high-teens UDW rig count. As these various programs come online.

Speaker #3: The Mediterranean and Black Sea has been a growth pocket. Partly due to the continued expansion of Turkish petroleums offshore ambitions. The region is now up to 11 rigs, up from an average of 7 to 9 last year.

Robert Eifler: The region is now up to 11 rigs, up from an average of 7 to 9 last year. This could expand to 12 rigs by the second half of this year, with the commencement of two programs in the Med offsetting the conclusion of the Noble Globetrotter I's contract in the Black Sea. Visibility beyond this year isn't quite clear yet, with a number of rigs rolling off contract by year-end, but the long-term trend has been one of secular UDW demand growth. From where we stand today, an estimated range of 10 to 12 rigs going forward looks sustainable. Continuing with Eastern Hemisphere strength, the Asia Pacific plus India region is witnessing a significant recovery, with contracted UDW activity rebounding over the next year from a trough level of 4 rigs to 8 currently.

Speaker #3: And this could expand to 12 rigs by the second half of this year, with the commencement of two programs in the Med offsetting the conclusion of the Noble Globetrotter One's contract in the Black Sea.

Speaker #3: Visibility beyond this year isn't quite clear yet, with a number of rigs rolling off contract by year-end. But the long-term trend has been one of secular UDW demand growth.

Speaker #3: So from where we stand today, an estimated range of 10 to 12 rigs going forward looks sustainable. Continuing with Eastern Hemisphere strength, the Asia Pacific plus India region is witnessing a significant recovery, with contracted UDW activity rebounding over the next year from a trough level of four rigs to eight currently.

Speaker #3: Additionally, the pipeline of open demand in the region remains robust, with over 30 rig years of active tenders and pre-tenders outstanding. Including a variety of requirements throughout Southeast Asia, India, and Australia.

Robert Eifler: Additionally, the pipeline of open demand in the region remains robust, with over 30 rig years of active tenders and pretenders outstanding, including a variety of requirements throughout Southeast Asia, India, and Australia. All of this indicates a likely upward bias of at least a couple more UDW units through 2027. Rounding out the global picture, the harsh environment North Sea and Norway market currently represents 22 units of total floater demand, 7 of which are satisfied by UDW semis, which is up by 1 to 2 units compared to a year ago. We are very excited to kick off preparations for the Noble GreatWhite's three-year program with Aker BP starting next year, and the redeployment of both the GreatWhite and the Endeavor points to a tightening market for harsh semis.

Speaker #3: All of this indicates a likely upward bias of at least a couple more UDW units through 2027. Rounding out the global picture, the harsh environment North Sea and Norway market currently represents 22 units of total floater demand.

Speaker #3: Seven of which are satisfied by UDW semis. Which is up by one to two units compared to a year ago. We are very excited to kick off preparations for the Noble Great White's three-year program with Ochre BP starting next year.

Speaker #3: And the redeployment of both the Great White and the Endeavor points to a tightening market for harsh semis. So the pathway back to 105 total contracted UDW rigs that we described on our earnings call last summer has, in fact, materialized.

Robert Eifler: So the pathway back to 105 total contracted UDW rigs that we described on our earnings call last summer has in fact materialized, if anything, faster than we had hoped. This is good momentum, but there's still some work to be done to arrest the recontracting churn. The average Brent crude price of $68 per barrel in 2025 was down by 15% compared to 2024, which I believe makes Noble's 30% year-over-year backlog growth stand out incredibly well by comparison.

Speaker #3: If anything, faster than we had hoped. This is good momentum, but there's still some work to be done to arrest the re-contracting churn. The average brent crude price of $68 per barrel in 2025 was down by 15% compared to 2024, which I believe makes Noble's 30% year-over-year backlog growth stand out incredibly well by comparison.

Speaker #3: However, we believe that a broader industry uptrend will necessarily require at least a modicum of positive upstream cash flow momentum. With both spot and long-term brent futures hovering in the high 60s per barrel, our end markets are for the most part highly economic, whereas our customers' budgets remain relatively inert, which creates friction for significant expansion and drilling activity and day rates.

Robert Eifler: However, we believe that a broader industry uptrend will necessarily require at least a modicum of positive upstream cash flow momentum, with both spot and long-term Brent futures hovering in the high $60s per barrel. Our end markets are, for the most part, highly economic, whereas our customers' budgets remain relatively inert, which creates friction for significant expansion in drilling activity and day rates. The great news for Noble is that our backlog progresses have already formed a strong foundation for rising utilization, EBITDA, and free cash flow, without necessarily a great deal of wind at our backs from a macro perspective. This sets us up well toward our goal of maintaining our robust shareholder capital returns through a transitional year in 2026, and supports visibility for a meaningful step-up in free cash flow next year, even in a flat world.

Speaker #3: The great news for Noble is that our backlog progresses have already formed a strong foundation for rising utilization EBITDA and free cash flow without necessarily a great deal of wind at our backs from a macro perspective.

Speaker #3: This sets us up well toward our goal of maintaining our robust shareholder capital returns through a transitional year in 2026, and supports visibility for a meaningful step up in free cash flow next year, even in a flat world.

Speaker #3: Before I turn the call over to Richard, I'd like to provide a brief update on our fleet strategy. Last month, we completed the sale of five jackups to Bor Drilling for $360 million.

Robert Eifler: Before I turn the call over to Richard, I'd like to provide a brief update on our fleet strategy. Last month, we completed the sale of 5 jackups to Borr Drilling for $360 million. Additionally, the $64 million sale of a sixth jackup, Noble Resolve, is expected to close in Q3 upon completion of its current contract. As we continue to sharpen Noble's strategic focus around the high-end deepwater and CJ70 jackup market, we have, in the process, unlocked capital available both for fleet reinvestment, in particular, the highly strategic reactivation and upgrade of the GreatWhite, as well as for preserving a highly flexible balance sheet and industry-leading shareholder capital returns program.

Speaker #3: Additionally, the 64 million sale of a sixth jackup Noble Resolve is expected to close in Q3 upon completion of its current contract. As we continue to sharpen Noble's strategic focus around the high-end deepwater and CJ70 jackup market, we have in the process unlocked capital available both for fleet reinvestment and particularly the highly strategic reactivation and upgrade of the Great White.

Speaker #3: As well as for preserving a highly flexible balance sheet and industry-leading shareholder capital returns program. On the jackup side, we remain fully committed to the CJ70 market in Norway and the North Sea.

Robert Eifler: On the jackup side, we remain fully committed to the CJ70 market in Norway and the North Sea, and we are encouraged to see early indications of the strongest utilization outlook for this fleet in many years. This aligns very nicely with our entry into the NCS floater market with the GreatWhite next year. With that, I'll pause here and pass the call to Richard.

Speaker #3: And we are encouraged to see early indications of the strongest utilization outlook for this fleet in many years. This aligns very nicely with our entry into the NCS floater market with the Great White next year.

Speaker #3: With that, I'll pause here and pass the call to Richard.

Speaker #2: Thank you, Robert, and good morning or good afternoon, all. In my prepared remarks today, I will briefly review the highlights of our fourth quarter and full year 2025 results, and then discuss our outlook for 2026.

Richard Barker: Thank you, Robert, and good morning or good afternoon all. In my prepared remarks today, I will briefly review the highlights of our fourth quarter and full year 2025 results, and then discuss our outlook for 2026. Starting with our quarterly results. Contract drilling services revenue for the fourth quarter totaled $705 million, Adjusted EBITDA was $232 million, and Adjusted EBITDA margin was 30%. Q4 cash flow from operations was $187 million, capital expenditures were $152 million, and free cash flow was $35 million. Last quarter, we terminated the BOP service agreement on the four Black Ships, which increased fourth quarter CapEx by $18 million. For the full year 2025, we generated $3.3 billion in revenue and $1.1 billion in Adjusted EBITDA.

Speaker #2: Starting with our quarterly results. Contract drilling services revenue for the fourth quarter totaled $705 million, adjusted EBITDA was $232 million, and adjusted EBITDA margin was 30%.

Speaker #2: Q4 cash flow from operations was $187 million, capital expenditures were $152 million, and free cash flow was $35 million. Last quarter, we terminated the BOP service agreement on the four Black Ships, which increased fourth quarter capex by $18 million.

Speaker #2: For the full year 2025, we generated $3.3 billion in revenue and $1.1 billion in adjusted EBITDA. Capex net of proceeds from insurance claims of $497 million included approximately $25 million of rebillable capex, and the aforementioned capex for the termination of the BOP service agreement.

Richard Barker: CapEx, net of proceeds from insurance claims of $497 million, included approximately $25 million of billable CapEx and the aforementioned CapEx for the termination of the BOP service agreement. This all resulted in $454 million in free cash flow for the year. As summarized on page 5 of the earnings presentation slides, our total backlog as of February 11 stands at $7.5 billion. As a reminder, our backlog excludes reimbursable revenue as well as revenue from ancillary services. Our current backlog includes approximately $2.3 billion that is scheduled for revenue conversion during the remainder of 2026, as well as a slightly greater amount that's already booked for 2027.

Speaker #2: This all resulted in $454 million in free cash flow for the year. As summarized on page five of the earnings presentation slides, our total backlog as of February the 11th stands at $7.5 billion.

Speaker #2: As a reminder, our backlog excludes reimbursable revenue as well as revenue from ancillary services. Our current backlog includes approximately $2.3 billion that is scheduled for revenue conversion during the remainder of 2026, as well as a slightly greater amount that's already booked for 2027.

Speaker #2: This is the first instant in many years in which our year two backlog has exceeded prompt year backlog at this point in the calendar, which highlights the embedded utilization and earnings ramp that we anticipate for 2027.

Richard Barker: This is the first incident in many years in which our year two backlog has exceeded prompt year backlog at this point in the calendar, which highlights the embedded utilization and earnings ramp that we anticipate for 2027. I'll circle back to this point in just a moment. Referring to page 9 of the earnings presentation, we are providing full year 2026 guidance for total revenue between $2.8 and 3 billion, which includes approximately $150 million in reimbursable and other revenue, and Adjusted EBITDA between $940 million and $1.02 billion. The low end of our Adjusted EBITDA range is fully covered by our existing firm backlog, plus a measure of relatively high confidence options. We currently expect Q1 Adjusted EBITDA to be roughly flat versus last quarter.

Speaker #2: I'll circle back to this point in just a moment. Referring to page nine of the earnings presentation, we are providing full year 2026 guidance for total revenue between $2.8 and $3 billion, which includes approximately $150 million in reimbursable and other revenue, and adjusted EBITDA between $940 million to $1.02 billion.

Speaker #2: The low end of our adjusted EBITDA range is fully covered by our existing firm backlog, plus a measure of relatively high confidence options. We currently expect Q1 adjusted EBITDA to be roughly flat versus last quarter.

Speaker #2: We also anticipate a slightly higher weighting of adjusted EBITDA in the second half of the year compared to the first half, although not dramatic.

Richard Barker: We also anticipate a slightly higher weighting of Adjusted EBITDA in the second half of the year compared to the first half, although not dramatic. Total capital expenditures in 2026 are expected to be between $590 and 640 million. This range includes approximately half of the $160 million GreatWhite project CapEx, with the remaining half included in the 2027 CapEx. Approximately $25 million of customer reimbursable CapEx, and approximately $50 million of additional project-related CapEx associated with the $1.3 billion of contract awards we announced in late January.

Speaker #2: Total capital expenditures in 2026 are expected to be between $590 million and $640 million. This range includes approximately half of the $160 million Great White project capex, with the remaining half included in the 2027 capex.

Speaker #2: Approximately $25 million of customer-reimbursable capex and approximately $50 million of additional project-related capex associated with the $1.3 billion of contract awards we announced in late January.

Speaker #2: While our capex for this year is amplified by previously announced upgrade projects, including the Noble Voyager and the Noble Ventura, as well as capital associated with more recent contracts, including the Great White Endeavor and Jerry D'Souza, these expenditures represent life of asset upgrades that support a fundamental enhancement to the NAV of our fleet and all with very robust project IRRs.

Richard Barker: While our CapEx for this year is amplified by previously announced upgrade projects, including the Noble Voyager and the Noble Ventura, as well as capital associated with more recent contracts, including the Noble GreatWhite, Noble Endeavor, and Noble Jerry de Souza, these expenditures represent life of asset upgrades that support a fundamental enhancement to the NAV of our fleet, and all with very robust project IRRs. This capital is an important enabler to a structurally higher level of potential EBITDA and free cash flow for our fleet. As discussed earlier, this is all supported by 2027 backlog, currently higher than 2026 backlog.

Speaker #2: This capital is an important enabler to a structurally higher level of potential EBITDA and free cash flow for our fleet. And as discussed earlier, this is all supported by 2027 backlog currently higher than 2026 backlog.

Speaker #2: Looking ahead to 2027 and beyond, we would expect capex net of customer reimbursements to taper meaningfully towards a range in the high $300 to $400 million, excluding the remaining Great White project capital, which is essentially how we would think about the go-forward run rate for the fleet, barring any meaningful additional contract-supported project capital.

Richard Barker: Looking ahead to 2027 and beyond, we would expect CapEx, net of customer reimbursements, to taper meaningfully towards a range in the high 300s to $400 million, excluding the remaining GreatWhite project capital, which is essentially how we would think about the go-forward run rate for the fleet, barring any meaningful additional contract-supported project capital. A few other elements for 2026 to consider are as follows: firstly, we expect cash taxes to be approximately 11% to 12% of adjusted EBITDA. Secondly, during 2026, we anticipate a maximum potential outlay of up to $85 million associated with the possible buyout of the BOP leases on the four Black Ships. This possible buyout is not included in our capital expenditures guidance. Next, we expect a favorable working capital reduction of around $100 million this year, partly driven by CapEx reimbursables.

Speaker #2: A few other elements for 2026 to consider are as follows. Firstly, we expect cash taxes to be approximately 11 to 12 percent of Secondly, during 2026, we anticipate a maximum potential outlay of up to $85 million associated with a possible buyout of the BOP leases on the four Black Ships.

Speaker #2: This possible buyout is not included in our capital expenditures guidance. Next, we expect a favorable working capital reduction of around $100 million this year, partly driven by capex reimbursables.

Speaker #2: Additionally, when modeling cash balances, recall that the sale of five jackups to bore drilling bought in $210 million in cash proceeds last month, plus the $150 million seller note.

Richard Barker: Additionally, when modeling cash balances, recall that the sale of five jackups to Borr Drilling brought in $210 million in cash proceeds last month, plus the $150 million seller notes. We also expect to close the additional $64 million cash sale of the Noble Resolve to Ocean Oilfield in Q3. As it relates to the Noble Resolve, we received approximately 1/3 of the sale proceeds as a deposit in Q4 2025. Lastly, our guidance reflects inflation rates in the low single-digit area on average across various cost components. With the significant recent advancements with our contract backlog underpinning forward revenue visibility, coupled with the anticipated normalization of net CapEx to a lower sustaining range after this year, we have increasing tangible visibility for a healthy inflection in both EBITDA and free cash flow next year.

Speaker #2: We also expect to close the additional $64 million cash sale of the Noble Resolve to Ocean Oilfield in the third quarter. As it relates to the Noble Resolve, we received approximately one-third of the sale proceeds as a deposit in Q4 2025.

Speaker #2: Lastly, our guidance reflects inflation rates in the low single-digit area on average across various cost components. With a significant recent advancements with our contract backlog, underpinning forward revenue visibility, coupled with the anticipated normalization of net capex to a lower sustaining range after this year, we have increasing tangible visibility for a healthy inflection in both EBITDA and free cash flow next year.

Speaker #2: By way of illustration, assuming 13 of our 15 Tier 1 drill ships working at current market rates contribution from all three D rigs and the remainder of our fleet essentially contracted at current status quo, we can envision an annualized run rate of around 1.3 billion in EBITDA, with corresponding free cash flow of approximately $600 million in the second half of 2027.

Richard Barker: By way of illustration, assuming 13 of our 15 Tier One drillships working at current market rates, contribution from all three D rigs and the remainder of our fleet essentially contracted at current status quo, we can envision an annualized run rate of around $1.3 billion in EBITDA, with corresponding free cash flow of approximately $600 million in the second half of 2027. With that, I'll pass the call back to Robert for closing remarks.

Speaker #2: With that, I'll pass the call back to Robert, the closing remarks.

Speaker #1: Thanks, Richard. To sum up, I'm incredibly excited about this moment for Noble. All of the strategy and effort that our organization has invested over the past five years is truly paying off.

Robert Eifler: Thanks, Richard. To sum up, I'm incredibly excited about this moment for Noble. All of the strategy and effort that our organization has invested over the past 5 years is truly paying off, as evidenced by our backlog build and widespread relationships with the world's most active deepwater producers. On backlog, our outperformance is a direct result of our strategy and has differentiated Noble over the past year, fundamentally recasting our contract coverage profile and substantially underwriting the material earnings and free cash flow inflection that Richard just mentioned. In connection with several of our major contract awards, we are making significant strategic investments to support our first-choice offshore strategy. With these investments, our fleet of 15 high-spec drillships will all have owned and integrated MPD or CML systems. Two-thirds will be equipped with NOV's leading-edge automation technology, including advanced robotics on several rigs, and 2 will feature 2.8-million-pound derricks.

Speaker #1: As evidenced by our backlog build and widespread relationships, with the world's most active deepwater producers. On backlog, our outperformance is a direct result of our strategy, and has differentiated Noble over the past year.

Speaker #1: Fundamentally recasting our contract coverage profile and substantially underwriting the material earnings and free cash flow inflection that Richard just mentioned. In connection with several of our major contract awards, we are making significant strategic investments to support our first choice offshore strategy.

Speaker #1: With these investments, our fleet of 15 high-spec drill ships will all have owned and integrated NPD or CML systems, two-thirds will be equipped with NOV's leading-edge automation technology, including advanced robotics on several rigs, and two will feature 2.8 million-pound derricks.

Speaker #1: Additionally, the Great White's modifications will place it as a Tier 1 floater in Norway, alongside our leading fleet of ultra-harsh CJ70 jackups. With all of this, we strongly believe that Noble has the most advanced automated fleet in deepwater and NCS.

Robert Eifler: Additionally, the GreatWhite's modifications will place it as a Tier One floater in Norway, alongside our leading fleet of ultra-harsh CJ70 jackups. With all of this, we strongly believe that Noble has the most advanced automated fleet in deepwater and in NCS. As Richard mentioned, the significant increase in our backlog, with over 90% of our 24 floaters now contracted, combined with the unique characteristic of having greater year two backlog in the books than current year backlog, serves to provide a direct line of sight to run rating approximately $1.3 billion of annualized EBITDA by the second half of 2027, even without any improvement in day rates.

Speaker #1: As Richard mentioned, the significant increase in our backlog, with over 90 percent of our 24 floaters now contracted, combined with the unique characteristic of having greater year two backlog in the books than current year backlog, serves to provide a direct line of sight to run rating approximately $1.3 billion of annualized EBITDA by the second half of 2027, even without any improvement in day rates.

Speaker #1: And with 10 of our 15 drill ships already secured by long-term programs, this implies only a small handful of highly marketable rigs to be contracted in order to de-risk that trajectory towards the highest free cash flow level this company has seen in over a decade.

Robert Eifler: And with 10 of our 15 drillships already secured by long-term programs, this implies only a small handful of highly marketable rigs to be contracted in order to de-risk that trajectory towards the highest free cash flow level this company has seen in over a decade. And I would further add that nothing about our near-term rollovers gives rise to significant concern, as the demand pipeline appears quite robust, with resource holders continuing to look offshore for future oil and gas developments of scale with advantaged economics. This is evidenced by a 33% increase versus last year in open tenders and pre-tenders for floaters, which is now back to around 100 rig years of open demand in the public domain, i.e., not counting direct award opportunities.

Speaker #1: And I would further add that nothing about our near-term rollovers gives rise to significant concern, as the demand pipeline appears quite robust with resource holders continuing to look offshore for future oil and gas developments of scale with advantaged economics.

Speaker #1: This is evidenced by a 33 percent increase versus last year in open tenders and free tenders for floaters, which is now back to around 100 rig years of open demand in the public domain.

Speaker #1: I.e., not counting direct award opportunities. Several high-profile and long-anticipated FIDs in places like Namibia, Suriname, and Mozambique, for example, stand out as key contributors to this next leg of the offshore cycle.

Robert Eifler: Several high-profile and long-anticipated FIDs in places like Namibia, Suriname, and Mozambique, for example, stand out as key contributors to this next leg of the offshore cycle. But as we have discussed earlier, there is considerable global breadth to the story. Previously, on our Q2 earnings call last summer, we communicated a milestone objective of $400 to 500 million of run rate free cash flow by the second half of 2026. Since that time, we have taken strategic investment decisions that have pushed the time horizon of this inflection back to 2027. However, we can now visualize around $600 million of run rate free cash flow by the second half of next year at current market rates, with significant leverage to day rate upside beyond this.

Speaker #1: But as we have discussed earlier, there is considerable global breadth to the story. Previously, on our second quarter earnings call last summer, we communicated a milestone objective of $400 to $500 million of run rate free cash flow by the second half of 2026.

Speaker #1: Since that time, we have taken strategic investment decisions that have pushed the time horizon of this inflection back to 2027. However, we can now visualize around $600 million of run-rate free cash flow by the second half of next year at current market rates.

Speaker #1: With significant leverage to day rate upside beyond this. And based on the emerging utilization improvement across the global fleet, as well as the encouraging leading indicators on forward demand, we would expect to see an upward bias to day rates from here.

Robert Eifler: Based on the emerging utilization improvement across the global fleet, as well as the encouraging leading indicators on forward demand, we would expect to see an upward bias to day rates from here. As we've seen before, rates can move from the low 400s to the high 400s in the blink of an eye. So it'll be interesting to see where this next part of the cycle takes us. But in the meantime, we will remain laser-focused on execution and continuing to deliver value for our customers and shareholders. With that, I'll turn it back over to the operator for questions.

Speaker #1: As we've seen before, rates can move from the low 400s to the high 400s in the blink of an eye. So it'll be interesting to see where this next part of the cycle takes us.

Speaker #1: But in the meantime, we will remain laser-focused on execution and continuing to deliver value for our customers and shareholders. With that, I'll turn it back over to the operator for questions.

Speaker #2: Thank you. At this time, I would like to remind everyone, if you would like to ask a question, please press star, then the number one on your telephone keypad, if you would like to withdraw your question, please press star one again.

Richard Barker: Thank you. At this time, I would like to remind everyone, if you would like to ask a question, please press star, then the number one on your telephone keypad.

Operator: Thank you. At this time, I would like to remind everyone, if you would like to ask a question, please press star, then the number one on your telephone keypad.

Operator 2: ... If you would like to withdraw your question, please press star one again. We do request for today's session that you please limit yourself to one question and one follow-up. Your first question will come from Arun Jayaram with JP Morgan Securities LLC.

Operator: ... If you would like to withdraw your question, please press star one again. We do request for today's session that you please limit yourself to one question and one follow-up. Your first question will come from Arun Jayaram with JP Morgan Securities LLC.

Speaker #2: We do request for today's session that you please limit yourself to one question and one follow-up. Your first question will come from Arun Jeram with JPMorgan Securities, LLC.

Speaker #3: Yeah, good morning, Robert and team. Robert, I was wondering if you could give us your thoughts on industry consolidation. Obviously, you've seen a large merger in Australia this week.

Arun Jayaram: Yeah, good morning, Robert and team. Robert, I was wondering if you could give us your thoughts on industry consolidation. Obviously, seeing a large merger announced earlier this week, and just your overall thoughts on the implications to Noble and your overall strategy.

Speaker #3: And just your overall thoughts on the implications to Noble and your overall strategy.

Speaker #4: Yeah, I mean, look, a consolidation has been the path for this industry post-COVID. Obviously, we've participated in that. And then this week, there's been a really significant announcement.

Robert Eifler: Yeah, I mean, look, consolidation's been the path for this industry, post-COVID. Obviously, we participated in that, and then this week there's been a really, significant announcement. You know, I think with the outlook for our industry, I think consolidation is the obvious path throughout the energy complex, throughout the entire chain. It's obviously been no different for the drillers. And you know, I'd say we certainly have benefited from it through the past years. We're a better company today, than when we started this journey. And I'm hopeful that broadly, consolidation makes the entire industry better, and more capable and more efficient, because that's the path forward for the drillers.

Speaker #4: I think with the outlook for our industry, I think consolidation is the obvious path throughout the energy complex, throughout the entire chain. It's obviously been no different for the drillers.

Speaker #4: And I'd say we certainly have benefited from it through the past years. We're a better company today than when we started this journey. And I'm hopeful that broadly consolidation makes the entire industry better.

Speaker #4: And more capable and more efficient because that's the path forward for the drillers.

Speaker #3: Got it. And I have my follow-up, Robert. Obviously, you've been a participant, as you mentioned, in industry consolidation including the Diamond Offshore transaction, Maersk.

Arun Jayaram: Got it. I have my follow-up, Robert. Obviously, you've been a participant, as you mentioned, in industry consolidation, including the Diamond Offshore transaction, Maersk. You obviously have a very capable offshore rig fleet. You compete at the very high end, high-spec end of the market. Do you feel you have sufficient scale now, you know, if the other deal does get through regulatory approval? And thoughts, do you see a window of opportunity perhaps to maybe further expand your opportunity set, perhaps in the floater market? You know, obviously, you've been divesting some of your shallow water jackups.

Speaker #3: You obviously have a very capable offshore rig fleet to compete at the very high end, high-spec end of the market. Do you feel you have sufficient scale now if the other deal does get through regulatory approval?

Speaker #3: And thoughts, do you see a window of opportunity perhaps to maybe further expand your opportunity set perhaps in the floater market? Obviously, you've been divesting some of your shallow water jackups.

Speaker #4: Yeah, look, I think the answer, strangely enough, is the same today as it would have been before Monday’s announcement—that we feel we have scale.

Robert Eifler: Yeah, look, I think the answer, strangely enough, is the same today as it would have been before Monday's announcement, that we feel we have scale. We, as I repeat myself, but we're a better company today than we were before because of the scale we've built. And there are gonna be opportunities out there. We will continue to look at everything, and we will continue to be as picky as we ever have been on ensuring that any opportunity we look at sits in kind of the right place for us as a company in terms of the type of asset and the quality of the asset.

Speaker #4: We as a repeat myself, but we're a better company today than we were before because of the scale we've built. And there are going to be opportunities out there.

Speaker #4: We will continue to look at everything and we will continue to be as picky as we ever have been on ensuring that any opportunity we look at sits in kind of the right place for us as a company in terms of the type of asset and the quality of the asset.

Speaker #3: Great. Thanks a lot.

Arun Jayaram: Great. Thanks a lot.

Speaker #4: Thank you.

Robert Eifler: Thank you.

Speaker #2: Your next question will come from Scott Gruber with Citigroup.

Operator 2: Your next question will come from Scott Gruber with Citigroup.

Operator: Your next question will come from Scott Gruber with Citigroup.

Speaker #5: Yes, good morning. I want to inquire about the recent strength in the sixth generation market. I think your recent contracts surprised the market. I guess first, what's driving that?

Scott Gruber: Yes, good morning. I want to inquire about the, the recent strength in the, the sixth-generation market. I think your recent contracts surprised the market. You know, I guess first, you know, what's, what's driving that? Is, is that just, you know, a collection of kind of projects moving forward? Is it a bit of, kind of, value buying by customers? And you mentioned, you know, prospects on the, on the Deliverer. Just curious whether you think you can get some, good term on, on that rig as well.

Operator: Yes, good morning. I want to inquire about the, the recent strength in the, the sixth-generation market. I think your recent contracts surprised the market. You know, I guess first, you know, what's, what's driving that? Is, is that just, you know, a collection of kind of projects moving forward? Is it a bit of, kind of, value buying by customers? And you mentioned, you know, prospects on the, on the Deliverer. Just curious whether you think you can get some, good term on, on that rig as well.

Speaker #5: Is that just a collection of kind of projects moving forward? Is it a bit of kind of value buying by customers? And you mentioned prospects on the deliverer just curious whether you think you can get some good term on that rig as well.

Speaker #4: Yeah, it's a good question. And not necessarily something we would have predicted a couple of years ago for sure. What I would say I think so our D-class semis are most of our sixth gen rigs.

Robert Eifler: Yeah, it's a good question. You know, not necessarily something we would've predicted a couple of years ago for sure. What I would say, I think. So our D-class semis are most of our sixth-gen rigs. And those are the most capable non-Norway semis out there. They have both moored capability and DP, and they're set up particularly well for certain types of operations. And so what I would say is, for that class of three rigs, it is a project-specific, right place, right time kind of phenomenon. I think it's sustainable. I don't mean to suggest that this is a window in time, but I think the fact that they've kind of contracted prior to the seventh gens is a phenomenon of being at the right place at the right time for the right projects.

Speaker #4: And those are the most capable non-Norway semis out there. They have both more capability and DP, and they're set up particularly well for certain types of operations. So what I would say is, for that class of three rigs, it is a project-specific, right place, right time kind of phenomenon.

Speaker #4: I think it's sustainable. I don't mean to suggest that this is a window in time, but I think the fact that they've kind of contracted prior to the seventh gens is a phenomenon being at the right place in the right time for the right projects.

Speaker #4: It's not a it's not a value decision by our customers as you mentioned, which is a good thought, but I do not believe that's what's driving it at all.

Robert Eifler: It's not a value decision by our customers, as you mentioned, which is a good thought, but I do not believe that's what's driving it at all.

Speaker #5: Got it. And then we've kind of long thought that the sixth gens we need to see better utilization just to get another round of upward momentum and rates across the collective seventh and sixth gen marketplace.

Scott Gruber: Got it. And then we've, we've kind of long thought that, you know, the, the sixth gens, we need to see better utilization just to get, you know, another round of, of upward momentum and rates across the collective seventh- and sixth-gen marketplace. It seems like, you know, the direction of travel there is, is positive. And you mentioned, you know, line of sight to essentially getting back to 105 UDWs. You know, what, what does it take, you know, to, to get some upward momentum and, and rates? You know, just do you think you have to kind of eclipse that level, you know, as crude prices, do you say, subdued or, you know, just kind of getting back there?

Robert Eifler: Got it. And then we've, we've kind of long thought that, you know, the, the sixth gens, we need to see better utilization just to get, you know, another round of, of upward momentum and rates across the collective seventh- and sixth-gen marketplace. It seems like, you know, the direction of travel there is, is positive. And you mentioned, you know, line of sight to essentially getting back to 105 UDWs. You know, what, what does it take, you know, to, to get some upward momentum and, and rates? You know, just do you think you have to kind of eclipse that level, you know, as crude prices, do you say, subdued or, you know, just kind of getting back there?

Speaker #5: It seems like the direction of travel there is positive. And you mentioned line of sight to potentially getting back to 105 UDWs. What does it take to get some upward momentum and rates?

Speaker #5: Just do you think you have to kind of eclipse that level? As crude prices do subdue or just kind of getting back there, do you think you'd inject enough tightness back into the market?

Scott Gruber: Do you think you'd inject enough tightness back into the market, or do we need to see crude prices improve to kind of, you know, see some, you know, additional spending capacity by customers? Just some thoughts on, you know, the conditions that could drive some day rate improvement here.

Robert Eifler: Do you think you'd inject enough tightness back into the market, or do we need to see crude prices improve to kind of, you know, see some, you know, additional spending capacity by customers? Just some thoughts on, you know, the conditions that could drive some day rate improvement here.

Speaker #5: Or do we need to see crude prices improve to kind of see some additional spending capacity by customers? Just some thoughts on the conditions that could drive some day rate improvement here.

Speaker #4: Yeah, it's really a question I wish I had the answer to. I think it's a mixture of both. I think what we're—this phenomenon where we're seeing higher backlog kind of in year two than year one right now—I think is somewhat crude agnostic.

Robert Eifler: Yeah, it's, it's really a good question. I, I wish I had the answer. I think it's a mixture of both. I think this phenomenon where we're seeing, for, you know, higher backlogged kind of in year two than year one right now, I think is somewhat crude agnostic, and I think is perhaps driven more by the realization that, you know, the volume of barrels is gonna have to be produced from deepwater, and those are all obviously long cycle, et cetera. And so I think that is more driven by this return to deepwater that, that we've seen play out over the last couple of years.

Speaker #4: And I think is perhaps driven more by the realization that the volume of barrels is going to have to be produced from deep water.

Speaker #4: And those are all obviously long cycle, etc. And so I think that is more driven by this return to deep water that we've seen play out over the last couple of years.

Speaker #4: However, the incremental rigs that probably define the tightness and supply and demand are—crude price does matter for near-term projects. And that's why we kind of outlined in our script the problem, not the answer.

Robert Eifler: However, you know, the incremental rigs that probably define the tightness in supply and demand, you know, are. Crude price does matter for near-term projects. And that's why we kind of outlined in our script the problem, not the answer. I personally am quite optimistic for 2027, for the reasons I mentioned in the prepared remarks. But we need another, say, 5 rigs, rig contracts that we don't see anywhere out there today to come through to really get to an extremely tight market, call it. I'm pretty confident that all of the, that everything is set up to supply that. I don't think there's any reason that couldn't happen by 2027, let me put it that way.

Speaker #4: I personally am quite optimistic for 2027 for the reasons I mentioned in the prepared remarks. But we need another say five rigs rig contracts that we don't see anywhere out there today to come through to really get to an extremely tight market, call it.

Speaker #4: I'm pretty confident that all of the that everything is set up to supply that. I don't think there's any reason that that couldn't happen by 2027.

Speaker #4: Let me put it that way. But we're a little cautious to say we're kind of going to have to see how 26 plays out here right now.

Robert Eifler: But we're a little cautious to say, we kinda gonna have to see how 2026 plays out here right, right now. I will say, I think there are a lot of contracts that are gonna get announced here, not just Noble, just across the board, over the next few months. And I think that obviously that should all be well received. We're including all of that in our analysis. And we're pretty hopeful that here, going into 2027, we've got the various pieces for a tightening market.

Speaker #4: I will say I think there are a lot of contracts that are going to get announced here, not just Noble, just across the board.

Speaker #4: Over the next few months. And I think that obviously that should all be well received. We're including all of that in our analysis. And we're pretty hopeful that here going into 2027 we've got the various pieces for a tightening market.

Speaker #5: I appreciate the color. Thank you.

Scott Gruber: I appreciate the color. Thank you.

Robert Eifler: I appreciate the color. Thank you.

Speaker #4: Thanks.

Speaker #2: Your next question will come from Eddie Kim with Barclays.

Robert Eifler: Thanks.

Operator 2: Your next question will come from Eddie Kim with Barclays.

Operator: Your next question will come from Eddie Kim with Barclays.

Speaker #3: Hi, good morning. I'll ask sort of the pricing question in a little bit of a different way. And appreciate all the detailed commentary on the outlook.

Eddie Kim: Hi, good morning. I'll ask sort of the pricing question in a little bit of a different way, and appreciate all the detailed commentary on the outlook. You said recent dayrate rig fixtures for Tier One drillships have been in the kind of ±$400,000 a day range. You pointed to a tightening market as we progress through this year. Do you think we could start seeing fixtures sometime next year in 2027 back up into the mid-$400,000s range? Or does that maybe look like more of a 2028 event, just based on the conversations you're having and the opportunities you're seeing out there today?

Speaker #3: You said recent day rate fixtures for tier one drill ships have been in the kind of plus or minus 400,000 a day range. You pointed to a tightening market as we progress through this year.

Speaker #3: Do you think we could start seeing fixtures sometime next year in 2027 back up into the mid-400s range? Or does 2028 event just based on conversations you're having in the opportunities you're seeing out there today?

Speaker #4: Yes. I think the possibility is there. I think I would stop a little bit short of making that the base case today. But maybe it's a 50-50.

Robert Eifler: Yes. I think the possibility is there. I think I would stop a little bit short of making that the base case today. But maybe it's a 50/50. I don't know. It's so hard to predict. But look, I think all of the pieces are laid out, and we need just a little bit more contribution worldwide to really tighten up the market going into mid-next year. You know, I would say a couple things about us specifically. One, you know, the things Richard laid out in his script are all completely out with day rate improvement.

Speaker #4: I don't know. It's so hard to predict. But look, I think all of the pieces are laid out. And we need just a little bit more contribution worldwide to really tighten up the market going into mid-next year.

Speaker #4: I would say a couple of things about us specifically. One, the things Richard laid out in his script are all completely out with day rate improvement.

Speaker #4: So we feel with our unique backlog curve where we've done a lot of the 2027 work already, we feel that we're extremely well positioned for an inflection here without day rate improvement.

Robert Eifler: So we feel with our unique backlog curve, where we've done a lot of the 2027 work already, we feel that we're extremely well-positioned for an inflection here without day rate improvement. And then, two, I would say also, I really like the way the fleet contracting is staggered right now. So we've got a nice mix of short-term availability, long-term contracting, and then, of course, our CDA, we price this up and down. And so I think I'm pretty pleased right now with the way the Noble fleet sits looking forward at everything.

Speaker #4: And then two, I would say also I really like the way the fleet contracting is staggered right now. So we've got a nice mix of short-term availability, long-term contracting, and then, of course, our CDA.

Speaker #4: We price this up and down. And so I think I'm pretty pleased right now with the way the Noble fleet sits looking forward at everything.

Speaker #5: Got it. Got it. Thanks for that color. My follow-up is just on negotiations with Petrobras. We haven't really heard any news about the London Extends either from you or anyone else.

Eddie Kim: Got it. Got it. Thanks for that color. My follow-up is just on negotiations with Petrobras. We haven't really heard any news about blend and extend, either from you or anyone else. I would've thought that we might have seen something on the Faye Kozack in your fleet update several weeks ago. You'd mentioned negotiations are still ongoing. When do you expect these will conclude? And separately, I mean, Petrobras has a tender out for Buzios and Tupi and Mero Fields. Is it fair to say they're unlikely to award these contracts until those blend and extend negotiations have concluded? Just any thoughts there will be great.

Speaker #5: I would have thought that we might have seen something on the Fay-Kozak in your fleet update several weeks ago. You'd mentioned negotiations are still ongoing.

Speaker #5: When do you expect these will conclude? And separately, I mean, Petrobras has a tender out for Busios and Tupi and Marrow Fields. Is it fair to say they're unlikely to award these contracts until those London Extends negotiations have concluded?

Speaker #5: Just any thoughts there would be great.

Speaker #4: Yeah, it's a good question. Something we're tracking closely along with everyone else. We're hopeful that the next couple of months bring a fair amount of news.

Robert Eifler: Yes, it's a good question, something we're tracking closely along with everyone else. You know, we're hopeful that the next couple of months bring a fair amount of news. If you look at it through Petrobras' lens, they have an incredibly complicated set of dynamics with their, you know, they've got more deepwater rigs than anyone else out there. They're managing the tenders you mentioned, as well as the blend and extends all at the exact same time. And that's a heavy lift. And so you could easily see how that could get pushed out a little bit past the next couple of months.

Speaker #4: If you look at it through Petrobras's lens, they have an incredibly complicated set, a dynamics with their they've got more deep water rigs than anyone else out there.

Speaker #4: They're managing the tenders you mentioned as well as the blended Extends, all of the exact same time. And that's a heavy lift. And so you could easily see how that could get pushed out a little bit past the next couple of months.

Robert Eifler: You know, I would add color, kind of referring back to our remarks, that we do think, you know, maybe Petrobras rig numbers probably come down, a couple of rigs. But we think, non-Petrobras players in Brazil are gonna basically make up that supply, change, in 2027.... And then from there, who knows? You know, plans change, and, so we're, we're, you know, generally positive, optimistic about Brazil, being, you know, kind of worse flat, which is, you know, in a good, really good place right now, and, hopefully up by a couple of rigs, over the next couple of years.

Speaker #4: I would add color kind of referring back to our remarks that we do think maybe Petrobras rig numbers probably come down a couple of rigs.

Speaker #4: But we think non-Petrobras players in Brazil are going to basically make up that supply change in 2027. And then from there, who knows? Plans change.

Speaker #4: And so we're generally positive optimistic about Brazil being kind of worse, flat, which is in a really good place right now. And hopefully up by a couple of rigs.

Speaker #4: Over the next couple of years.

Speaker #5: Got it. Great. Thanks for that color. I'll turn it back.

Eddie Kim: Got it. Great, thanks for that color. I'll turn it back.

Speaker #4: Thanks, Ed.

Robert Eifler: Thanks, Ed.

Speaker #2: Your next question will come from Frederick Singh with Clarkson Securities.

Operator 2: Your next question will come from Fredrik Stene with Clarksons Securities.

Operator: Your next question will come from Fredrik Stene with Clarksons Securities.

Speaker #5: Hey, team. Hope you are all well. And thank you for the prepared and detailed remarks on the rig market in particular. I wanted to ask a bit more about the Norwegian market because a couple of moves here that you've done recently, one obviously signing the Great White with AKBT and focusing your jacket fleet solely on the heavy-duty harsh environment market.

Fredrik Stene: Hey, team, hope you are all well, and thank you for the prepared and detailed remarks on the rig market in particular. I wanted to ask a bit more about the Norwegian market, because the, you know, couple moves here that you've done recently, one, obviously signing the Great White with Aker BP and focusing your jackup fleet solely on the, you know, high, heavy-duty, harsh environment market. If you take that kind of combined with your prepared remarks where you said that the outlook, I think, for these particular markets were better than you had seen in many years. Are we able to elaborate a bit on that? And maybe specifically on the jackup side, since the Great White, after all, has been contracted for three years.

Speaker #5: If you take that kind of combined with your prepared remarks, where you said that the outlook, I think, for these particular markets was better than you had seen in many years, are you able to elaborate a bit on that, and maybe specifically on the jackup side, since the Great White, after all, has been contracted for three years?

Fredrik Stene: Why, what makes you optimistic and what should we... You know, how should we think about the jackup fleet in 2027, 2028, where there's some space that definitely needs to be filled? Thanks.

Speaker #5: What makes you optimistic and what should we how should you think about the jacket fleet in 2027, 2028 where there's some space that definitely needs to be filled?

Speaker #5: Thanks.

Speaker #4: Yeah, it's a good question. I don't want to imply more than too much optimism. And look, we've got contracts for the CJ70s. A number of those are in the UK sector, which is great.

Robert Eifler: Yeah, it's a good question. I don't want to imply more than too much optimism. And look, we've got contracts for the CJ70s. A number of those are in the UK sector, which is great. I'm not sure that we see a renaissance in shallow water Norway right now, so I don't wanna overstate that or have that misunderstood. But we do have contracts for everything. We do have multiple customers that are looking at and considering potential jobs in Norway. So the market's expanded well past you know, just Equinor, and obviously I include Equinor in the multiple customers.

Speaker #4: I'm not sure that we see a renaissance in shallow water Norway right now. So I don't want to overstate that or have that misunderstood.

Speaker #4: But we do have contracts for everything. We do have multiple customers that are looking at and considering potential jobs in Norway. So the market's expanded well past just Equinor.

Speaker #4: And obviously, I include Equinor in the multiple customers. But I think with the rigs kind of in a steady state utilization right now, and some ongoing conversations, it just feels like it's more likely to get better than worse for sure.

Robert Eifler: But you know, I think with the rigs kind of in a steady state utilization right now, and some ongoing conversations, it just feels like it's more likely to get better than worse, for sure. Okay, maybe Norway specific stays more flat than up, but it definitely feels flat or up right now. And you know, we think we have the most capable rigs in the world ready to go, if we do get an incremental unit or two of demand in Norway.

Speaker #4: Okay, maybe Norway-specific stays more flat than up. But it definitely feels flat or up right now. And we think we have the most capable rigs in the world ready to go if we do get an incremental unit or two of demand in Norway.

Speaker #5: All right. That's very helpful. One quick one more. Turning to the floater fleet you have the Globetrotter 1. It soon will go off contract.

Fredrik Stene: All right, no, that's, that's very helpful. One quick one more. Turning to the floater fleet. You have the Globetrotter I, you know, soon will go off contract. You have the Ocean Apex, and that's idle. The Deliverer, you seem very optimistic about, potentially having a good chunk of work from 2027 and beyond. Do you have any commentary on how you view the Ocean Apex and the Globetrotter in your fleet as we, you know, look forward? Thanks.

Speaker #5: You have the Apex that's idle. Deliverer you seem very optimistic about potentially having a good chunk of work from 2027 and beyond. But do you have any commentary on how you view the ocean Apex and the Globetrotter in your fleet as we look forward?

Speaker #5: Thanks.

Speaker #4: Yeah. So on the Globetrotter, we've said before that we're effectively bidding those into intervention or niche drilling applications. So obviously, the Black Sea qualifies for that since those rigs can go into the bridge pretty quickly and efficiently.

Robert Eifler: Yeah. So on the Globetrotter, we've said before that we're effectively bidding those into intervention or niche drilling applications. So obviously, the Black Sea qualifies for that, since those rigs can go into the Black Sea pretty quickly and efficiently. You know, I think the intervention market remains out there, and we're, you know, I'd say we're kind of chasing a mixture of intervention and potentially some niche programs for the Globetrotter. Apex is, you know, probably... We'll see what happens with that rig. So there's, I guess, less on the horizon for that rig. We're gonna keep looking hard at that one.

Speaker #4: I think the intervention market remains out there. And I'd say we're kind of chasing a mixture of intervention and potentially some niche programs.

Speaker #4: For the Globetrotter, Apex is probably we'll see what happens with that rig. So I guess less on the horizon for that rig. We're going to keep looking hard at that one.

Speaker #5: All right. Thank you so much for your answers. Have a good day.

Fredrik Stene: All right. Thank you so much for your answers. Have a good day.

Speaker #4: Thank you.

Robert Eifler: Thank you.

Speaker #2: Your next question will come from Ben Summers with BTIG.

Operator 2: Your next question will come from Ben Summers with BTIG.

Operator: Your next question will come from Ben Summers with BTIG.

Speaker #5: Hey, good morning, guys, and thanks for taking my question. So first, on the Blacker, I know and kind of just the US Gulf market in general, just kind of curious and it was great to see that rig get some work.

Gregory Lewis: Hey, good morning, guys, and thanks for taking my question. So first on the Black Rhino and kind of just the US Gulf market in general, just kind of curious, and it was great to see that rig, you know, get some work, and I know we have the 100-day drilling option, but just curious, kind of longer term there, you know, what you think the potential is for maybe, you know, more spot work in the US Gulf or potentially moving that rig elsewhere. Any color there would be helpful. Thank you.

Benjamin Sommers: Hey, good morning, guys, and thanks for taking my question. So first on the Black Rhino and kind of just the US Gulf market in general, just kind of curious, and it was great to see that rig, you know, get some work, and I know we have the 100-day drilling option, but just curious, kind of longer term there, you know, what you think the potential is for maybe, you know, more spot work in the US Gulf or potentially moving that rig elsewhere. Any color there would be helpful. Thank you.

Speaker #5: And I know we have the 100-day drilling option. But just curious kind of longer term there, what you think the potential is for maybe more spot work in the US Gulf or potentially moving that rig elsewhere.

Speaker #5: Any color there would be helpful. Thank you.

Speaker #4: Yeah. So it's a good question. We're spending our myself and our marketing group spending a lot of time on that rig. We have multiple opportunities.

Robert Eifler: Yeah, so it's a good question. That's, we're spending our, our, myself and our margin group are spending a lot of time on that rig. We have multiple opportunities. So I would, I would say, you know, for 2026, we're hopeful that there's some spot work out there, but, there's, there's probably not a huge amount of upside on, on the rig. Hopefully some. I think the more exciting programs for that rig really are in 2027. Those exist both in the US and outside of the US. And we've got a, a couple of different opportunities with some of our, closest customers globally, and, and we're hopeful that we can, can land something there. That, that, that rig is an excellent rig.

Speaker #4: So I would say for 2026, we're hopeful that there's some spot work out there. But there's probably not a huge amount of upside. On the rig, hopefully some.

Speaker #4: I think the more exciting programs for that rig really are in 2027. Those exist both in the US and outside of the US. And we've got a couple of different opportunities with some of our closest customers globally and we're hopeful that we can land something there.

Speaker #4: That rig is an excellent rig. It's outfitted very well for big development campaigns. And obviously, it can perform with the best of them for shorter-term and exploration jobs as well.

Robert Eifler: It's outfitted very well for big development campaigns, and obviously can perform with the best of them for shorter-term and exploration jobs as well. We're hopeful to land something here before too long.

Speaker #4: So we're hopeful to land something here. Before too long.

Speaker #5: Awesome. Thanks for the color. Then kind of just more broadly, I know you guys spoke on the 2027 kind of expected demand pickup. I guess, is there any kind of concern there that projects could continue to shift to the right, I guess, particularly in a market like West Africa?

Gregory Lewis: Awesome. Thanks for the color. Then kind of just more broadly, I know you guys spoke, you know, on the 2027 kind of expected demand pickup. I guess, is there any kind of concern there that projects could continue to shift to the right, I guess, particularly in a market like West Africa? Or are we pretty confident here that that's kind of in the past now, and that demand should really, you know, begin to substantially pick up in 2027? Just kind of curious on anything here and there.

Benjamin Sommers: Awesome. Thanks for the color. Then kind of just more broadly, I know you guys spoke, you know, on the 2027 kind of expected demand pickup. I guess, is there any kind of concern there that projects could continue to shift to the right, I guess, particularly in a market like West Africa? Or are we pretty confident here that that's kind of in the past now, and that demand should really, you know, begin to substantially pick up in 2027? Just kind of curious on anything here and there.

Speaker #5: Are we pretty confident here that that's kind of in the past now, and that demand should really begin to substantially pick up in 2027? Just kind of curious on anything here and there.

Speaker #4: Not a day that I don't wake up concerned about things getting pushed to the right. So it's obviously always a risk in our business.

Robert Eifler: Not a day that I don't wake up concerned about things getting pushed to the right. So it's obviously always a risk in our business. When you've got Brent in the 60s, it's always going to be a risk in the business. Partly why, you know, we're not exactly calling for predicting with certainty what happens in 2027. But I will say, with all of the backlog that's been announced by Noble and our competitors, and I think an amount of backlog that will be announced here in the coming months, the number of pieces that need to fall in place for a tight 2027 are substantially lower than what we've seen in quite some time.

Speaker #4: When you’ve got Brent in the $60s, it’s always going to be a risk in the business. That’s partly why we’re not exactly calling for or predicting with certainty what happens in 2027.

Speaker #4: But I will say with all of the backlog that's been announced by Noble and our competitors, and I think an amount of backlog that will be announced here in the coming months, the number of pieces that need to fall in place for a tight 2027 are substantially lower than what we've seen in quite some time.

Robert Eifler: We threw out the statistic about the kind of open demand that's out there. There's obviously direct negotiations that are in excess of those numbers. And we look at where we sit today in the year, in the rollovers, it's kind of, there's no story, negative story about 2026 rollovers. It looks like upstream CapEx is either flat or up, and if you know, you try to decode what that means for deepwater and commentary around it, it feels like that's a reasonable story for 2026. And for us, you add all of those together, and it gives us a fair amount of optimism for a pretty tight market in 2027.

Speaker #4: Throughout the statistic about the kind of open demand that's out there, there's obviously direct negotiations that are in excess of those numbers. And we look at where we sit today in the year, in the rollovers, it's kind of there's no negative story about 2026 rollovers.

Speaker #4: It looks like upstream CapEx is either flat or up. And if you try to decode what that means for deep water and commentary around it, it feels like that's a reasonable story for 2026.

Speaker #4: And for us, you add all of those together, and it gives us a fair amount of optimism for a pretty tight market in 2027.

Speaker #5: Awesome. Thank you guys for taking my questions.

Gregory Lewis: Awesome. Thank you, guys, for taking my questions.

Benjamin Sommers: Awesome. Thank you, guys, for taking my questions.

Speaker #4: Thank you.

Robert Eifler: Thank you.

Speaker #2: And your final question will come from Keith Beckman with Pickering Energy Partners.

Operator 2: Your final question will come from Keith Beckmann with Pickering Energy Partners.

Operator: Your final question will come from Keith Beckmann with Pickering Energy Partners.

Speaker #5: Hey, thanks for taking my question, guys. I had a question kind of relating around the CapEx on the nine contracts outside of the Great White.

Keith Beckmann: Hey, thanks for taking my question, guys. I had a question kind of relating around the CapEx on the nine contracts outside of the GreatWhite. So I think it's about $50 million of CapEx, and I believe you guys said it was related to the Endeavor and the D'Souza. Can you sort of bucket between those two rigs, roughly what that is for me?

Speaker #5: So I think it's about 50 million of CapEx and I believe if you guys said it was related to the Endeavor and the D'Souza.

Speaker #5: Can you sort of bucket between those two rigs roughly what that is for me?

Speaker #4: Yeah. So I think you're talking about the incremental 50 million of contract capital that we announced in conjunction with the 1.3 billion of backlog here about two weeks or so ago.

Robert Eifler: Yeah. So, so I think you're talking about the incremental $50 million of contract capital that we announced in conjunction with the $1.23 billion of backlog here about two-

Keith Beckmann: Yes

Robert Eifler: Two weeks or so ago. I think about that incremental capital as kind of split between the Endeavor and the de Souza.

Speaker #4: I think think about that incremental capital as kind of split between the Endeavor and the D'Souza.

Speaker #5: Okay. Perfect. Awesome. And then my other question was just relating around, and I think this was hit on maybe a little bit earlier, but just relating around the remaining five jackups, does it potentially make sense if somebody comes in with the right price now to kind of make yourselves the largest pure play floater fleet?

Keith Beckmann: Okay, perfect.

Robert Eifler: Yes, yes, yes.

Keith Beckmann: Awesome. And then, my other question was just relating around, and I think this was hit on maybe a little bit earlier, but just relating around, the remaining five jackups. Does it potentially make sense if somebody comes in with the right price now to kind of make yourself the largest pure play floater fleet? Just any color around that.

Speaker #5: Just any color around that.

Speaker #4: Yeah. Look, it's a good question. No, we're committed to the CJ70s when we announced the merger with Maersk. We chose to put our secondary headquarters in Stabanger.

Robert Eifler: Yeah, look, it's a good question. No, we're committed to the CJ seventies. When we announced the merger with Maersk, we chose to put our secondary headquarters in Stavanger. We have an established, extremely capable operation there, and with the addition of the Noble GreatWhite, some added scale. So, we're pretty happy with where we sit there right now.

Speaker #4: We have an established extremely capable operation there. And with the addition of those in Great White, some added scale. So we're pretty happy with where we sit there right now.

Speaker #5: Perfect. Really appreciate the color. Thanks for taking my questions.

Keith Beckmann: Perfect. Really appreciate the color. Thanks for taking my questions.

Speaker #4: Thank you.

Robert Eifler: Thank you.

Operator 2: That concludes the Q&A portion of today's call. I would now like to turn the call back over to Mr. Ian Macpherson for any closing remarks.

Speaker #2: And that concludes the Q&A portion of today's call. I will now let you turn the call back over to Mr. Ian MacPherson for any closing remarks.

Operator: That concludes the Q&A portion of today's call. I would now like to turn the call back over to Mr. Ian Macpherson for any closing remarks.

Speaker #6: Thank you for joining us today, everyone. We appreciate your interest, and we will look forward to speaking with you again next quarter. Have a great day.

Ian Macpherson: Thank you for joining us today, everyone. We appreciate your interest, and we will look forward to speaking with you again next quarter. Have a great day.

Operator 2: Thank you for your participation. This does conclude today's conference. You may now disconnect.

Operator: Thank you for your participation. This does conclude today's conference. You may now disconnect.

Q4 2025 Noble Corp PLC Earnings Call

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