As of September 30, 2023, Vantage had approximately $77.6 million in cash, including $7.6 million of restricted cash, compared to $93.3 million in cash, including $19.2 million of restricted cash, at December 31, 2022. At September 30, 2023, Vantage maintained $13.2 million of cash pre-funded by our Managed Services customers to address near-term obligations during the third quarter of 2023. Excluding cash used in connection with our Managed Services customers, the Company used $0.9 million of cash during the third quarter of 2023.

Ihab Toma, CEO, commented: “I am pleased to report that our financial performance for the quarter ending September 30, 2023, has significantly improved year over year. This improvement is attributed to our reduced debt level, increased fleet utilization, and higher day rates, showcasing our path to growth and profitability”

Mr. Toma continued: “As always, we would not be in this position without the hard work and dedication of our onshore and offshore personnel and the continued support from our clients”

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

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

Non-GAAP Measures

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

Public & Investor Relations Contact:
Rafael Blattner
Chief Financial Officer
Vantage Drilling International
C/O Vantage Energy Services, Inc.
777 Post Oak Blvd., Suite 440
Houston, Texas 77056
(281) 404-4700

 

Vantage Drilling International
Consolidated Statement of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Revenue
Contract drilling services $ 76,190 $ 34,092 $ 191,780 $ 121,749
Management fees 6,086 4,442 13,775 8,385
Reimbursables and other 21,426 32,424 83,059 72,393
Total revenue 103,702 70,958 288,614 202,527
Operating costs and expenses
Operating costs 73,988 66,429 214,926 169,767
General and administrative 5,561 4,253 15,553 17,745
Depreciation 11,065 11,022 33,159 33,404
(Gain) loss on EDC Sale (632 ) 3 (61,413 )
Total operating costs and expenses 90,614 81,072 263,641 159,503
Income (loss) from operations 13,088 (10,114 ) 24,973 43,024
Other (expense) income
Interest income 251 17 441 28
Interest expense and other financing charges (5,343 ) (8,504 ) (16,247 ) (25,511 )
Other, net 115 (363 ) (20 ) (2,149 )
Total other expense (4,977 ) (8,850 ) (15,826 ) (27,632 )
Income (loss) before income taxes 8,111 (18,964 ) 9,147 15,392
Income tax provision 8,097 1,566 10,703 1,783
Net income (loss) 14 (20,530 ) (1,556 ) 13,609
Net income (loss) attributable to noncontrolling interests 10 (332 ) (736 ) 606
Net income (loss) attributable to shareholders $ 4 $ (20,198 ) $ (820 ) $ 13,003
EBITDA(1) $ 24,258 $ 877 $ 58,848 $ 73,673
Earnings (loss) per share
Basic $ 0.00 $ (1.54 ) $ (0.06 ) $ 0.99
Diluted $ 0.00 $ (1.54 ) $ (0.06 ) $ 0.98
Weighted average ordinary shares outstanding,
Basic 13,229 13,115 13,213 13,115
Diluted 13,323 13,115 13,213 13,330
(1) EBITDA represents net income (loss) before (i) interest income (expense), (ii) provision for income taxes and (iii) depreciation and amortization expense. EBITDA is not a financial measure under GAAP as defined under the rules of the SEC, and is intended as a supplemental measure of our performance. We believe this measure is commonly used by analysts and investors to analyze and compare companies on the basis of operating performance.
Vantage Drilling International
Supplemental Operating Data
(Unaudited, in thousands, except percentages)
Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Operating costs and expenses
Jackups $ 7,366 $ 13,223 $ 15,088 $ 31,907
Deepwater 26,056 20,738 69,174 51,216
Managed Rigs 17,825 (6 ) 52,084 (5 )
Held for Sale(2) 10,703
Operations support 2,764 2,515 8,340 8,380
Reimbursables 19,977 29,959 70,240 67,566
Total operating costs and expenses $ 73,988 $ 66,429 $ 214,926 $ 169,767
Utilization
Jackups 67.2 % 51.3 % 83.4 % 68.1 %
Deepwater 84.9 % 96.7 % 81.0 % 95.6 %
Held for Sale(2) N/A N/A N/A 43.6 %
(2) Included in the sale of Emerald Driller Company, which owns the Emerald Driller, Sapphire Driller and Aquamarine Driller .Each of these rigs were classified as held for sale on our Consolidated Balance Sheets up to the closing date, which was on May 27, 2022.

 

Vantage Drilling International
Consolidated Balance Sheets
(In thousands, except share and par value information)
(Unaudited)
September 30, 2023 December 31, 2022
ASSETS
Current assets
Cash and cash equivalents $ 70,000 $ 74,026
Restricted cash 639 16,450
Trade receivables, net of allowance for credit losses of $3,850 and $4,962, respectively 87,313 62,776
Materials and supplies 47,973 41,250
Prepaid expenses and other current assets 41,788 25,621
Total current assets 247,713 220,123
Property and equipment
Property and equipment 653,488 647,909
Accumulated depreciation (341,357 ) (309,453 )
Property and equipment, net 312,131 338,456
Operating lease ROU assets 1,300 1,648
Other assets 16,348 18,334
Total assets $ 577,492 $ 578,561
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable $ 63,191 $ 57,775
Other current liabilities 56,879 66,179
Total current liabilities 120,070 123,954
Long–term debt, net of discount and financing costs of $10,487 and $773, respectively 189,513 179,227
Other long-term liabilities 7,204 12,881
Commitments and contingencies
Shareholders’ equity
Ordinary shares, $0.001 par value, 50 million shares authorized; 13,229,280 and 13,115,026 shares issued and outstanding, each period 13 13
Additional paid-in capital 633,625 633,863
Accumulated deficit (373,967 ) (373,147 )
Controlling interest shareholders’ equity 259,671 260,729
Noncontrolling interests 1,034 1,770
Total equity 260,705 262,499
Total liabilities and shareholders’ equity $ 577,492 $ 578,561

 

Vantage Drilling International
Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
Nine Months Ended September 30,
2023 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income $ (1,556 ) $ 13,609
Adjustments to reconcile net (loss) income to net cash used in operating activities
Depreciation expense 33,159 33,404
Amortization of debt financing costs 1,455 1,229
Share-based compensation expense 45 61
Loss on debt extinguishment 703
Deferred income tax expense 994 301
Gain on disposal of assets (1,600 )
Loss (gain) on EDC Sale 3 (61,413 )
Changes in operating assets and liabilities:
Trade receivables, net (24,537 ) (50,289 )
Materials and supplies (6,723 ) (2,218 )
Prepaid expenses and other current assets (9,377 ) 2,680
Other assets 4,810 (23,222 )
Accounts payable 5,416 31,873
Other current liabilities and other long-term liabilities (15,822 ) 33,624
Net cash used in operating activities (11,430 ) (21,961 )
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment (6,833 ) (8,154 )
Net proceeds from EDC Sale 198,700
Net proceeds from sale of assets 3,100
Net cash (used in) provided by investing activities (6,833 ) 193,646
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from 9.50% First Lien Notes 194,000
Repayment of long-term debt (180,000 )
Shares repurchased for tax withholdings on settlement of RSUs (246 )
Payments of dividend equivalents (5,278 )
Debt issuance costs (5,850 )
Net cash provided by financing activities 2,626
Net (decrease) increase in unrestricted and restricted cash and cash equivalents (15,637 ) 171,685
Unrestricted and restricted cash and cash equivalents—beginning of period 93,257 90,608
Unrestricted and restricted cash and cash equivalents—end of period $ 77,620 $ 262,293

 

Vantage Drilling International
Non-GAAP Measures
(In thousands)
(Unaudited)
Three Months Ended September 30, Nine Months Ended September 30,
Reconciliation of EBITDA 2023 2022 2023 2022
Net income (loss) attributable to shareholders $ 4 $ (20,198 ) $ (820 ) $ 13,003
Depreciation 11,065 11,022 33,159 33,404
Interest income (251 ) (17 ) (441 ) (28 )
Interest expense and other financing costs 5,343 8,504 16,247 25,511
Income tax provision 8,097 1,566 10,703 1,783
EBITDA $ 24,258 $ 877 $ 58,848 $ 73,673

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