Borr Drilling Limited

Good day and thank you for standing by. Welcome to the Board Trillings Limited Q1 2025 results presentation, webcast and conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. If you wish to ask a question via the webcast, please use the Q&A box available on the webcast link at any time during the conference. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Mr. Patrick Sean, CEO. Please go ahead.

Thank you. Good morning, and thank you for participating in the Board Drilling first quarter earnings call. I'm Patrick Schorn, and with me here today in London are Bruno Morant, our Chief Commercial Officer, and Magnus Fahler, our Chief Financial Officer. Next slide, please. First, covering the required disclaimers. I would like to remind all participants that some of the statements will be forward-looking. These matters involve risks and uncertainties that could cause actual results to differ materially from those projected in these statements. I therefore refer you to our latest public filings. Next slide, please. Our first quarter results were largely as expected, reflecting the impact of temporary rig suspensions and preparatory work for upcoming contracts. Total operating revenue declined by 46.5 million quarter over quarter, resulting in adjusted EBITDA of 96.1 million for the period. During the quarter, we averaged 16 active rigs out of our 24 rig fleet. Despite the lower activity level, operational performance remained robust with technical utilization at 99.2% and economic utilization at 97.9% for our active rigs, a reflection of the continued strength and efficiency of our operations. On the safety front, I'm pleased to report that several of our rigs received industry and customer recognition for outstanding safety performance. Notably, the grower was awarded Qatar Energy's HSE Award for 2024, and the Prospector One received the 2024 Best Safety Performance Award from the IADC North Sea Chapter. In Thailand, Board Drilling received PTT EEP's CEO Safety Excellence Award for the second consecutive year. These achievements are a statement to the commitment and professionalism of our crews, and I congratulate and thank the entire team for their efforts on safety. Looking at the second quarter, we are seeing a meaningful ramp-up of activity. Three suspended rigs in Mexico have resumed operations, while the Valia and Arabia One have both commenced their contracts. In addition, the Thor and Ron have secured new contracts starting this quarter. As a result, our operating rig count has now increased to 22, laying the foundation for stronger financial performance in the quarters ahead. Our liquidity position improved during the quarter, supported by the collection of approximately $120 million in outstanding receivables from Mexico and $10 million in mobilization fees for the Valley. Following the quarter end, we received an additional $35 million in mobilization fees related to Valley and the Arabia One. While we continue To pursue several opportunities in 2025, our commercial efforts are now increasingly focused on 2026. Our rigs in Mexico represent a significant portion of our available days in 2026 and beyond. The combination of increased activity in Q2 and the advancement of private investment projects in Mexico are positive for future rig demand and extensions across our fleeting country. In light of uncertain market conditions, the Board has decided to suspend the dividend to further reinforce the balance sheet and enhance long-term value creation. While we are not issuing specific EBITDA, adjusted EBITDA guidance for 2025, we are, however, confirming to be comfortable with the current Bloomberg consensus estimate of approximately 460 million. I'll pass the call now to Magnus for the first quarter financial commentary.

Thank you, Patrick. The results for the first quarter were highly impacted by temporary rig suspensions and mobilization of rigs to commence contracts, which led to us only having 16 out of our 24 rigs working on average during the quarter. The total operating revenues were $216.6 million, a decrease of $46.5 million compared to the fourth quarter. Day rate revenues decreased by $22.6 million, primarily due to a decrease in the number of operating days for Arabia 2, RAN, and the Thor, partially offset by an increase in operating days for GERD, Gunload, and Valley. The overall decrease in day rate revenue also includes an $11.5 million decrease in deferred mobilization revenue related to Arabia II due to the recognition of accelerated amortization of deferred mobilization revenue in the prior quarter, linked to its contract termination in Saudi Arabia in Q4. Bearable charter revenue decreased by $17.9 million as a result of the temporary suspension of the rigs Galar, Grid, and Gersami in Mexico, who were suspended effective January 8. and management contract revenue decreased by 6 million due to the suspension of the GALAR. Total operating expenses for Q1 were 156.8 million, a decrease of 5.1 million compared to Q4. This is primarily due to 4.2 million decrease in rigged OPEX and 1.1 million decrease in GNA. The decrease in rigged OPEX consists of 10.2 million of lower expenses due to the decrease in operating days partially offset by a 5.2 million increase in costs associated with grid and Gersami as a result of the company assuming their operating expenses and stacking costs during their temporary suspension period. Prior to the temporary suspension and during operations, these costs are borne by the JV. Net loss for the first quarter was 16.9 million, a decrease of 43.2 million compared to the net income in the fourth quarter, and adjusted EBITDA was 96.1 million, a decrease of 40.6 million from the previous quarter. Now moving into our cash. Our free cash position at the end of Q1 was 170 million. In addition, we had 150 million undrawn under our RCS facility, resulting in total available liquidity of 320 million. Cash increased by 108.4 million in the quarter in comparison to the previous quarter. Net cash from operating activities was $138.7 million, which included approximately $120 million in outstanding receivables from customers in Mexico and $10 million in mobilization fees received for the valley. We paid $6.1 million of cash interest and $16.9 million of cash taxes. Net cash used in investing activities was $25.1 million, of which $25 million related to cash used on Jacob additions, primarily as a result of activation costs for the Valley and long-term maintenance costs. Net cash used in financing activities was $4.9 million and can be explained mainly by the $4.7 million payment of cash distribution to shareholders. And subsequent to court rent, we have received approximately $35 million in mobilization fees following commencement of the contracts for the Arabia One and the Valley. With this, I will pass the word on to Bruno.