Borr Drilling Limited Reports First Quarter Results
Borr Drilling Limited ("Borr") announces its unaudited results for the first quarter of 2025. The company has seen significant changes in its financial performance compared to previous quarters.
Financial Highlights
In the first quarter, Borr recorded total operating revenues of $216.6 million, which reflects a decrease of $46.5 million compared to the fourth quarter of the previous year. The company faced a net loss of $(16.9) million, a notable decrease compared to the net income from the last quarter of 2024. Adjusted EBITDA was reported at $96.1 million, down by $40.6 million from the previous quarter.
Despite these challenges, the company was awarded nine new contract commitments in the year-to-date period for 2025, amounting to approximately 1,550 days of operational activity and a potential revenue of $221 million.
Comments from the CEO
CEO Patrick Schorn provided insights into the company's performance, stating that the first-quarter results were largely in line with expectations and were primarily affected by temporary rig suspensions and preparations for upcoming contracts. The fleet of active rigs averaged 16 out of the total 24-rig fleet during this period. Schorn highlighted that operational performance remained strong, with a technical utilization of 99.2% and an economic utilization of 97.9% for the active rigs, demonstrating the efficiency of their operations.
Safety Achievements
On the safety front, several rigs received accolades for their excellent safety records. The Groa rig was honored with Qatar Energy's HSE Award for 2024, while the Prospector 1 rig earned the 2024 Best Safety Performance Award from the IADC North Sea Chapter. In recognition of their excellence, Borr Drilling also received the PTTEP's CEO SSHE Excellence Award for the second year running.
Future Prospects
Looking ahead, Borr Drilling anticipates an increase in operational activity in the second quarter of 2025. Three suspended rigs in one region are now back to work, and contracts for the Vali and Arabia I have commenced. Furthermore, the Thor and Ran rigs secured new contracts, increasing the number of operating rigs to 22, positioning Borr for enhanced financial performance in the upcoming quarters.
The liquidity of the company improved due to the collection of around $120 million in outstanding receivables, along with $10 million in mobilization fees for Vali. An additional $35 million in mobilization fees related to upcoming projects has been received after the quarter ended.
Contract Coverage
Recent contract awards have bolstered Borr's portfolio, with coverage for 2025 now at 79% based on an average day rate of $147,000. This represents a decrease from the previous year's average day rate but reflects ongoing efforts to secure contracts as they also focus on 2026 and beyond.
Dividend Decision
The Board has opted not to pay a dividend amid uncertain market conditions, aiming to strengthen the balance sheet for long-term value creation. While the company is foregoing specific Adjusted EBITDA guidance for 2025, it is comfortable with the Bloomberg consensus estimate of approximately $460 million. With a rise in active rigs, Borr expects significant increases in Adjusted EBITDA in the near future.
Conference Call Information
A conference call is scheduled to take place soon, allowing participants to learn more about these developments. They are encouraged to join the call a few minutes early to ensure a smooth experience.
Frequently Asked Questions
What were the total operating revenues for Borr Drilling in Q1 2025?
The total operating revenues for Borr Drilling in Q1 2025 were $216.6 million.
How many new contracts were awarded in YTD 2025?
In YTD 2025, Borr Drilling was awarded nine new contract commitments.
What is the expected EBITDA for Borr Drilling in 2025?
Borr Drilling is comfortable with a consensus Adjusted EBITDA estimate of approximately $460 million for 2025.
What percentage of contract coverage does Borr have for 2025?
Borr Drilling's contract coverage for 2025 is 79% based on the latest contracts awarded.
Why has Borr decided not to pay dividends?
Borr opted not to pay dividends to reinforce the balance sheet and focus on long-term value creation amid uncertain market conditions.
