Ensco plc Reports Fourth Quarter and Full-Year 2013 Results

  Ensco plc Reports Fourth Quarter and Full-Year 2013 Results

                    Record Full-Year Revenues and Earnings
       #1 in Total Customer Satisfaction for 2013; Fourth Year in a Row
                 Doubled Dividend to $3.00 Per Share Annually
                        Invested $1.8 Billion in Fleet
Two New ENSCO 120 Series Jackups and One Additional Ultra-Deepwater Drillship
                                  Delivered
          Commenced Contracts for Three New Ultra-Deepwater Floaters
       Sold Additional Rigs as Part of Continuous High-Grading Strategy

Business Wire

LONDON -- February 19, 2014

Ensco plc (NYSE: ESV) reported today that diluted earnings per share were
$1.54 in fourth quarter 2013 compared to $0.94 in fourth quarter 2012.
Discontinued operations primarily related to rigs and other assets no longer
on the Company’s balance sheet reduced earnings by $0.02 per share in fourth
quarter 2013 and $0.10 per share in fourth quarter 2012. Diluted earnings per
share from continuing operations increased to $1.56 in fourth quarter 2013
from $1.04 a year ago.

Certain items influenced earnings per share from continuing operations
comparisons year to year. Provision for income taxes in fourth quarter 2012
included $75 million, $0.33 per share, in discrete tax items including $51
million related to restructuring certain subsidiaries from the 2011
acquisition and $24 million of additional discrete tax items primarily related
to adjustments of certain prior year tax positions. Adjusted for these items,
fourth quarter earnings per share from continuing operations increased 14% to
$1.56 from $1.37 a year ago.

Full-year 2013 diluted earnings per share were $6.07 compared to $5.04 in
2012. Discontinued operations resulted in a loss of $0.02 per share in 2013
and $0.19 per share in 2012. Diluted earnings per share from continuing
operations increased 16% to $6.09 in 2013 from $5.23 per share in 2012. In
2013, revenues grew 14% to a record $4.920 billion and net income increased
21% to a record $1.418 billion.

Chairman, President and Chief Executive Officer Dan Rabun stated, “The past
year has been a period of remarkable growth for Ensco. We achieved record
revenues and earnings as we added three new ultra-deepwater rigs to our active
fleet. Each of these rigs commenced work on multi-year contracts for repeat
customers, reinforcing the advantages of fleet standardization.”

“We also accepted delivery of our first two ultra-premium, harsh environment
ENSCO 120 Series jackups,” Mr. Rabun added. “Both rigs were contracted well in
advance of their delivery dates through direct negotiations with customers for
multi-year programs. The patented cantilever system on these rigs provides
significant drilling efficiencies.”

Mr. Rabun concluded, “Ensco’s fleet will continue to grow as we complete the
construction of six additional rigs scheduled for delivery through 2016.
Highgrading our fleet with technologically-advanced rigs is a key element of
our success in achieving the highest levels of customer satisfaction.
Recently, Ensco once again was rated #1 in total customer satisfaction by
EnergyPoint, an independent research firm. This is the fourth year in a row
and our offshore crews and onshore personnel are to be commended for this
impressive accomplishment."

Fourth Quarter Results

Revenues grew 16% to $1.256 billion in fourth quarter 2013 from $1.086 billion
a year ago. The average day rate for the fleet increased 16% to $230,000,
mostly due to the addition of ENSCO 8506, ENSCO DS-6 and ENSCO DS-7 to the
active fleet, as well as higher day rates for several floaters and an increase
in the jackup segment average day rate.

Contract drilling expense was $616 million compared to $525 million in fourth
quarter 2012. In fourth quarter 2012, favorable settlements of $11 million and
deferred expenses related to shipyard upgrades reduced contract drilling
expense. Adjusted for these items, contract drilling expense increased 13%
year to year. This increase was primarily due to adding new floaters to the
active fleet, as well as a previously anticipated increase in unit labor
costs.

Depreciation expense was $157 million compared to $144 million in fourth
quarter 2012. The $13 million increase was mostly due to a growing active
fleet. General and administrative expense was $35 million in fourth quarter
2013, unchanged from a year ago.

Interest expense in fourth quarter 2013 was $35 million, net of $21 million of
interest that was capitalized, compared to interest expense of $28 million in
fourth quarter 2012, net of $29 million of interest that was capitalized.

The effective tax rate was 12.2% in fourth quarter 2013. Adjusted for $75
million in discrete tax items noted above, the effective tax rate was 11.7% in
fourth quarter 2012.

Segment Highlights

Floaters

Floater revenues grew 16% to $779 million in fourth quarter 2013 from $672
million a year ago, primarily due to the commencement of new contracts for
ENSCO 8506, ENSCO DS-6 and ENSCO DS-7. The average day rate increased 19% to
$438,000 from $368,000 in fourth quarter 2012.

Reported utilization was 73% compared to 83% a year ago, mostly due to two
factors. ENSCO 5002 and ENSCO 5004 were idle during fourth quarter 2013 due to
the bankruptcy of OGX, a Brazilian operator. ENSCO 5000, which was stacked
during fourth quarter 2013, was contracted during fourth quarter 2012.
Adjusted for planned downtime and uncontracted rigs, operational utilization
was 89% compared to 90% in fourth quarter 2012.

Floater contract drilling expense was $393 million in fourth quarter 2013, up
26% from $313 million in fourth quarter 2012. A growing active floater fleet
contributed to this increase along with higher unit labor costs. In fourth
quarter 2012, favorable settlements of $11 million and deferred expenses
related to shipyard upgrades reduced contract drilling expense. Adjusted for
these items, contract drilling expense increased 18% year to year.

Jackups

Jackup revenues grew 17% to $461 million, up from $393 million a year ago. The
increase was mostly due to a $16,000 increase in the average day rate to
$127,000 driven by strong customer demand around the world. Reported
utilization was 89% compared to 87% a year ago. Adjusted for planned downtime
and uncontracted rigs, operational utilization was 97% compared to 99% in
fourth quarter 2012. Contract drilling expense increased 7% to $211 million,
mostly due to an increase in unit labor costs.

Other

Other is composed of managed drilling rig operations. Revenues decreased to
$16 million from $20 million in fourth quarter 2012, primarily due to the
expiration of a managed drilling contract during third quarter 2013. Contract
drilling expense was $12 million, compared to $15 million in fourth quarter
2012.

                                                                                                                                        
                   Fourth Quarter
                                                                                                                                                                                   
(in millions                                                                                                               Reconciling
of $,
except %)          Floaters                           Jackups                            Other                             Items                       Consolidated Total
                   2013        2012        Chg        2013        2012        Chg        2013       2012       Chg         2013         2012         2013          2012          Chg
                                                                                                                                                                                   
Revenues           779.0       672.3       16 %       460.7       392.9       17 %       15.9       20.3       -22 %       -             -             1,255.6       1,085.5       16 %
Operating
Expenses
Contract           393.2       313.1       26 %       210.8       196.2       7  %       11.7       15.2       -23 %       -             -             615.7         524.5         17 %
drilling
Depreciation       113.3       99.6        14 %       41.7        42.6        -2 %       -          -          -           1.7           1.7           156.7         143.9         9  %
General and        -           -           -         -           -           -         -          -          -          35.2         35.0         35.2          35.0          1  %
admin.
Operating
Income             272.5       259.6       5  %       208.2       154.1       35 %       4.2        5.1        -18 %       (36.9 )       (36.7 )       448.0         382.1         17 %
(loss)
                                                                                                                                                                                      

Strong Financial Position – 31 December 2013

Ensco maintained a strong financial position:

  *$11 billion of contracted revenue backlog excluding bonus opportunities
  *Long-term debt-to-capital ratio of 27%
  *Fully available $2 billion revolving credit facility
  *$166 million of cash and cash equivalents

EVP and Chief Financial Officer Jay Swent commented, “During 2013, we doubled
our dividend to $3.00 per share annually, reinforcing our ability to return
additional capital to shareholders while investing in our fleet. Capital
expenditures for full-year 2013 totaled $1.8 billion, of which 72% was
invested in new construction. These investments, coupled with future capital
spending for our six rigs under construction, will support the future growth
of our company. We also continued to high-grade our fleet by selling three
more rigs over the past year, bringing the total to 13 rigs sold since 2009.
Proceeds from these sales have been reinvested in our fleet.”

Ensco will conduct a conference call at 10:00 a.m. Central Time (4:00 p.m.
London time) on Thursday, 20 February 2014, to discuss fourth quarter 2013
results. The call will be webcast live at www.enscoplc.com. Interested parties
may listen to the call by dialing (866) 652-5200 from within the United States
and +1 (412) 317-6060 from outside the U.S. Please ask for the Ensco
conference call. It is recommended that participants call fifteen minutes
before the scheduled start time.

A replay of the conference call will be available by telephone one hour after
the completion of the call through 7 March 2014 by dialing (877) 344-7529 or,
if calling from outside the U.S. +1 (412) 317-0088 (conference ID 10039562). A
webcast replay, MP3 download and transcript of the call will be available at
www.enscoplc.com.

Ensco plc (NYSE: ESV) brings energy to the world as a global provider of
offshore drilling services to the petroleum industry. For more than 25 years,
the Company has focused on operating safely and exceeding customer
expectations. Ensco is ranked #1 for total customer satisfaction with top
honors in eight of 14 separate categories in the most recent annual survey by
EnergyPoint Research. Operating one of the newest ultra-deepwater rig fleets
and the largest premium jackup fleet, Ensco has a major presence in the most
strategic offshore basins across six continents. Ensco plc is an English
limited company (England No. 7023598) with its registered office and corporate
headquarters located at 6 Chesterfield Gardens, London W1J 5BQ. To learn more,
visit our website at www.enscoplc.com.

Statements contained in this press release that are not historical facts are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of
1934.Forward-looking statements include words or phrases such as
“anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,”
“could,” “may,” “might,” “should,” “will” and similar words and specifically
include statements regarding expected financial performance, effective tax
rate, day rates and backlog; the timing of delivery, mobilization, contract
commencement, relocation or other movement of rigs; and general market,
business and industry conditions, trends and outlook. Such statements are
subject to numerous risks, uncertainties and assumptions that may cause actual
results to vary materially from those indicated, including downtime and other
risks associated with offshore rig operations, relocations, severe weather or
hurricanes; changes in worldwide rig supply and demand, competition and
technology; future levels of offshore drilling activity; governmental action,
civil unrest and political and economic uncertainties; terrorism, piracy and
military action; risks inherent to shipyard rig construction, repair,
maintenance or enhancement; possible cancellation or suspension of drilling
contracts as a result of mechanical difficulties, performance or other
reasons; the outcome of litigation, legal proceedings, investigations or other
claims or contract disputes; governmental regulatory, legislative and
permitting requirements affecting drilling operations; our ability to attract
and retain skilled personnel on commercially reasonable terms; environmental
or other liabilities, risks or losses; debt restrictions that may limit our
liquidity and flexibility; our ability to realize the expected benefits from
our redomestication and actual contract commencement dates. In addition to the
numerous factors described above, you should also carefully read and consider
“Item 1A. Risk Factors” in Part I and “Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations” in Part II of our
most recent annual report on Form 10-K, as updated in our subsequent quarterly
reports on Form 10-Q, which are available on the SEC’s website at www.sec.gov
or on the Investor Relations section of our website at www.enscoplc.com. Each
forward-looking statement speaks only as of the date of the particular
statement, and we undertake no obligation to publicly update or revise any
forward-looking statements, except as required by law.


ENSCO PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share amounts)
(Unaudited)
                                                                
                                                                                       
                       Three Months Ended                  Twelve Months Ended
                       December 31,                        December 31,
                       2013              2012              2013              2012
                                                                                       
OPERATING              $ 1,255.6         $ 1,085.5         $ 4,919.8         $ 4,300.7
REVENUES
                                                                                       
OPERATING
EXPENSES
Contract
drilling                 615.7             524.5             2,402.5           2,028.0
(exclusive of
depreciation)
Depreciation             156.7             143.9             611.9             558.6
General and             35.2            35.0            146.8           148.9   
administrative
                        807.6           703.4           3,161.2         2,735.5 
                                                                                       
OPERATING INCOME         448.0             382.1             1,758.6           1,565.2
                                                                                       
OTHER INCOME
(EXPENSE)
Interest income          4.3               5.5               16.6              22.8
Interest                 (35.2   )         (28.1   )         (158.8  )         (123.6  )
expense, net
Other, net              2.0             .9              42.1            2.2     
                        (28.9   )        (21.7   )        (100.1  )        (98.6   )
                                                                                       
INCOME FROM
CONTINUING
OPERATIONS               419.1             360.4             1,658.5           1,466.6
BEFORE INCOME
TAXES
                                                                                       
PROVISION FOR            51.0              117.1             225.6             244.4
INCOME TAXES
                                                                                       
INCOME FROM
CONTINUING               368.1             243.3             1,432.9           1,222.2
OPERATIONS
                                                                                       
LOSS FROM
DISCONTINUED             (4.1    )         (22.1   )         (5.0    )         (45.5   )
OPERATIONS, NET
                                                                                       
NET INCOME               364.0             221.2             1,427.9           1,176.7
                                                                                       
NET INCOME
ATTRIBUTABLE TO          (2.6    )         (1.7    )         (9.7    )         (7.0    )
NONCONTROLLING
INTERESTS
                                                                                       
NET INCOME
ATTRIBUTABLE TO        $ 361.4          $ 219.5          $ 1,418.2        $ 1,169.7 
ENSCO
                                                                                       
                                                                                       
EARNINGS (LOSS)
PER SHARE -
BASIC
Continuing             $ 1.57            $ 1.04            $ 6.10            $ 5.24
Operations
Discontinued            (0.02   )        (0.10   )        (0.02   )        (0.19   )
Operations
                       $ 1.55            $ 0.94            $ 6.08            $ 5.05
                                                                                       
EARNINGS (LOSS)
PER SHARE -
DILUTED
Continuing             $ 1.56            $ 1.04            $ 6.09            $ 5.23
Operations
Discontinued            (0.02   )        (0.10   )        (0.02   )        (0.19   )
Operations
                       $ 1.54            $ 0.94            $ 6.07            $ 5.04
                                                                                       
NET INCOME
ATTRIBUTABLE TO
ENSCO SHARES -         $ 357.5           $ 217.0           $ 1,403.1         $ 1,157.4
BASIC AND
DILUTED
                                                                                       
WEIGHTED-AVERAGE
SHARES
OUTSTANDING
Basic                    231.2             230.0             230.9             229.4
Diluted                  231.4             230.3             231.1             229.7
                                                                                       


ENSCO PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions)
(Unaudited)
                                                           
                                                                  
                                               December 31,       December 31,
                                               2013               2012
                                                                  
ASSETS
                                                                  
CURRENT ASSETS
Cash and cash equivalents                      $  165.6           $  487.1
Accounts receivable, net                          855.7              811.4
Other                                            513.9             425.4
Total current assets                              1,535.2            1,723.9
                                                                  
PROPERTY AND EQUIPMENT, NET                       14,311.0           13,145.6
                                                                  
GOODWILL                                          3,274.0            3,274.0
                                                                  
OTHER ASSETS, NET                                352.7             421.8
                                                                  
                                               $  19,472.9        $  18,565.3
                                                                  
                                                                  
LIABILITIES AND SHAREHOLDERS' EQUITY
                                                                  
CURRENT LIABILITIES
Accounts payable and accrued liabilities       $  999.8           $  942.2
and other
Current maturities of long-term debt             47.5              47.5
Total current liabilities                         1,047.3            989.7
                                                                  
LONG-TERM DEBT                                    4,718.9            4,798.4
                                                                  
DEFERRED INCOME TAXES                             362.1              351.7
                                                                  
OTHER LIABILITIES                                 545.7              573.4
                                                                  
TOTAL EQUITY                                     12,798.9          11,852.1
                                                                  
                                               $  19,472.9        $  18,565.3
                                                                     


ENSCO PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
                                                         
                                             Twelve Months Ended
                                             December 31,
                                             2013                 2012
                                                                  
OPERATING ACTIVITIES
Net income                                   $ 1,427.9            $ 1,176.7
Adjustments to reconcile net income
to net cash provided by
operating activities of continuing
operations:
Discontinued operations, net                   5.0                  45.5
Depreciation expense                           611.9                558.6
Other                                          38.0                 (7.8     )
Changes in operating assets and               (102.5   )          427.2    
liabilities
Net cash provided by operating                1,980.3            2,200.2  
activities of continuing
operations
                                                                  
INVESTING ACTIVITIES
Additions to property and equipment            (1,779.2 )           (1,802.2 )
Purchases of short-term investments            (50.0    )           (90.0    )
Maturities of short-term investments           50.0                 44.5
Advance payment received on sale of            33.0                 -
assets
Other                                         6.0                3.2      
Net cash used in investing                    (1,740.2 )          (1,844.5 )
activities of continuing
operations
                                                                  
FINANCING ACTIVITIES
Cash dividends paid                            (525.6   )           (348.1   )
Reduction of long-term borrowings              (47.5    )           (47.5    )
Proceeds from exercise of share                22.3                 35.8
options
Debt financing costs                           (4.6     )           -
Commercial paper borrowings, net               -                    (125.0   )
Equity issuance reimbursement                  -                    66.7
Other                                         (21.7    )          (17.4    )
Net cash used in financing                    (577.1   )          (435.5   )
activities
                                                                  
DISCONTINUED OPERATIONS
Operating activities                           .2                   (13.1    )
Investing activities                          15.5               147.3    
Net cash provided by discontinued             15.7               134.2    
operations
                                                                  
Effect of exchange rate changes on             (.2      )           2.0
cash and cash equivalents
                                                                  
(DECREASE) INCREASE IN CASH AND CASH           (321.5   )           56.4
EQUIVALENTS
                                                                  
CASH AND CASH EQUIVALENTS, BEGINNING          487.1              430.7    
OF YEAR
                                                                  
CASH AND CASH EQUIVALENTS, END OF            $ 165.6             $ 487.1    
YEAR
                                                                             


ENSCO PLC AND SUBSIDIARIES
OPERATING STATISTICS
(Unaudited)
                                                       
                                                                  Third
                              Fourth Quarter                      Quarter
                              2013              2012              2013
                                                                  
Rig utilization^(1)
                                                                  
Floaters                        73      %         83      %         79      %
Jackups                         89      %         87      %         90      %
                                                                
Total                          83      %        86      %        86      %
                                                                  
                                                                  
Average day rates^(2)
                                                                  
Floaters                      $ 438,050         $ 367,718         $ 416,201
Jackups                         126,771           111,459           125,434
                                                                
Total                         $ 230,230         $ 199,025         $ 225,244
                                                                            


^(1)   Rig utilization is derived by dividing the number of days under
         contract by the number of days in the period.
         Days under contract equals the total number of days that rigs have
         earned and recognized day rate revenue,
         including days associated with compensated downtime and
         mobilizations. When revenue is earned but is deferred
         and amortized over a future period, for example when a rig earns
         revenue while mobilizing to commence a new contract
         or while being upgraded in a shipyard, the related days are excluded
         from days under contract.
         
         For newly-constructed or acquired rigs, the number of days in the
         period begins upon commencement of drilling
         operations for rigs with a contract or when the rig becomes available
         for drilling operations for rigs without a contract.
         
^(2)     Average day rates are derived by dividing contract drilling revenues,
         adjusted to exclude certain types of non-recurring
         reimbursable revenues, lump sum revenues and revenues attributable to
         amortization of drilling contract intangibles, by
         the aggregate number of contract days, adjusted to exclude contract
         days associated with certain mobilizations,
         demobilizations, shipyard contracts and standby contracts.

Contact:

Ensco plc
Sean O’Neill, 713-430-4607
Vice President - Investor Relations and Communications
or
Nick Georgas, 713-430-4490
Manager - Investor Relations
 
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