2017
subsidiaries, the "Group" or “Borr Drilling”) is an international
up d
ng
2017,
7
.
of 31 December 2017, the Company’s fleet consisted of 26 jack up
Borr Drilling’s strategy is to build a substantial fleet of jack up
basis.
n
non
,
The first rig from PPL, the “Galar”, was delivered on November 15,
of the “Gerd”, the second rig from PPL on January 4, 2018. On
January 5, 2018, the first rig from Keppel, the “Saga”, was delivered.
31, 2017,
Transocean’s entire jack
Transocean’s fleet and five newbuild
228,600,000
,
,
,
v
,
that is relevant to employees’ duties and responsibilities. We strive
up
up
2
.
o
instalments of US$159.5 million for the delivery of the “Galar” and
the “Saga” from PPL and Keppel, respectively, in Q4 2017 (payment
for the “Saga” was made in December 2017, rig delivered January
US$87.0 million for the “Galar”.
As of December 31, 2017, the Company’s cash and cash equivalents
, 2017
Also in
,
228,600,000
incentive program for the Company’s employees.
warrants (“Warrants”) to Schlumberg
construction at Keppel FELS Limited (“Keppel”) from Transocean
up
In December 2017, the “Frigg”, a 2013 built KFELS Super A class
.
In January 2018, “Norve”, a 2011 built BM C Pacific Class 400 jack
BW Energy Dussafu B.V. (“BW Energy”)
160 days.
“Galar” of US$87.0 million.
Market
d
During 2017,
up
3
Outlook
22
,
.
Risk Factors
savings realised in our client base’s supply chains, and anticipated
2018.
–
$
companies exploring for or producing oil and/or natural gas (“E&P
Companies”) are sensitive to changes in oil and natural gas prices.
The Group’s focus will be on operations in the shallow water
have a material adverse effect on the demand for the Group’s
.
Group’s operations.
he Group’s revenue
,
pany’s business, financial condition, results of
,
d,
up
two
,
Company’s control.
n adverse effect on the Company’s
4
In January 2018, the “Norve” commenced operations for BW
On February 23, 2018, the Company took delivery of the “Gersemi”,
On M arch 22, 2018, it was announced that Simon Johnson’s contract
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
75,658,500
69,604,141
36,786,801
23,319,900
21,250,000
18,781,437
17,071,440
15,662,000
11,126,800
9,096,082
8,750,000
8,113,785
7,840,658
7,496,000
6,486,532
5,344,283
5,107,200
4,642,850
4,290,700
4,273,958
Holdings
Dnb Luxembourg S.A.
J.P. M organ Bank Lux.
360,703,067
2,670 117,589,433
2,690 478,292,500 100.0%
75.5% Total top 20 shareholders
24.5
On January 4, 2018, the Company took delivery of “Gerd”, the
On January 5, 2018, the company took delivery of “Saga” the first
5
As a consequence of the listing of Borr Drilling’s shares on the Oslo
Board
’
’
’
’
’
”
“
’
.
’
.
on
’
’
Company’s objects and purposes as unrestricted. This deviates from
’
6
ng such Director’s
Drilling’s website –
The work of the Board
of and the risks related to the Borr Group’s operations.
The Board supervises the Company’s internal control systems.
(cid:120)
(cid:120)
(cid:120)
(cid:120)
independent of the Company’s main shareholders. Further, i
7
four components. The first component is each individual’s fixed
ividual’s position and
Company’s results.
valuation of the Company’s shares to the financial markets on a
parties will find the Company’s latest news releases, financial
Information to Borr Drilling’s shareholders shall be published on the
Company’s website at the same time as it is sent to the shareholders.
–
The Board will seek to ensure that the Company’s business
8
(cid:120)
(cid:120) Mission –
–
(cid:120)
–
.
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
working together and benefit from each other’s strengths.
,
9
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Supply Chains Act and/or
the U.S. Government’s Federal
Borr Drilling conducts appropriate due diligence or “vetting” of Borr
party’ agents who perform
(cid:120)
(cid:120)
10
(ii) that would affect the individual’s objectivity in carrying
n
ling’s designated Compliance Risks Officer, who has
(cid:120)
(cid:120)
(cid:120)
(cid:120)
o
(cid:120)
(cid:120)
11
Consolidated Financial Statements
Consolidated Financial Statements
2017
0.1
21.7
21.7
6
17
3
4
5
5
11
(88.0)
Diluted loss per share
13
rigs
Consolidated Financial Statements
2017
2016
19
10, 19
12, 13
6
7
11
6
16
16
8, 14
14
7, 8, 21
164.0
39.1
22.4
225.5
0.1
783.3
642.7
20.7
1,446.8
1,672.3
9.6
11.5
21.1
87.0
71.3
158.3
179.4
4.8
1,587.8
2.0
1,492.9
1,672.3
138.1
138.1
20.0
20.0
158.1
0.2
0.2
0.2
0.8
157.8
157.8
158.1
14
Consolidated Financial Statements
2017
31, 2016
6
12
10
9
11
7
6
18
8
up
equivalents
8.2
47.9
20.1
1,415.0
12.7
87.0
1,506.3
25.9
138.1
164.0
0.4
0.2
139.2
13.0
152.2
138.1
138.1
15
Statements of Changes in Shareholders’ Equity
Comprehensive
equity
Accumulated
5
5,000
77,500,000
0.8
77,505,000
228,600,000
162,500,000
x
v
9,687,500
0.8
2.3
1.6
0.1
151.4
10.7
157.8
797.8
648,4
7.7
1.7
1.8
non
478,292,500
4.8
1,587.8
152.2
10.7
157.8
800.1
650.0
0.1
7.7
3.5
2.0
2.0
2.0
1,492.9
‘Common shares and warrants issued subject to put option agreements’ and were then transferred back to equity upon completion of the
v.
x.
16
Consolidated Financial Statements
“Group,” “our” and words of similar import refer to Borr Drilling and its consolidated companies. The use herein of such term
“organisation”, “we”, “us”, “our” and “its”, or references to specific entities, is not intended to be a precise description
ss otherwise required by the context, the term “Borr Drilling” refers to Borr Drilling Limited and the terms “Company,” “we,”
“group”,
.
Unrealized gains and losses arising from transactions with associates are eliminated to the extent of the Company’s
n
investments that are deemed to increase an asset’s value for its remaining useful life are capitalized and depreciated over t
17
Consolidated Financial Statements
two methods; a. income approach in which the fair value was estimated based on a calculation of the rig’s discounted future n
Onerous contracts
an asset or a liability at the purchase date. The Company’s onerous contracts relates to contracts for newbuildings
share options issued under the Company’s employee
of accumulated other comprehensive income in shareholders’ equity. Gains and losses are not realized until the securities are
.
18
Consolidated Financial Statements
are denominated in U.S. dollars. Accordingly, the Company’s reporting currency is also U.S. dol
or losses on consolidation are recorded as a separate component of other comprehensive income in shareholders’ equity.
Current and non
The Company accounts for fair value in accordance with ASC 820, Fair Value M easurements and Disclosures (“ASC 820”). Fair
19
Consolidated Financial Statements
hierarchy are considered observable inputs and the last is considered unobservable. The Company’s cash and cash equivalents
v
20
Consolidated Financial Statements
Basic earnings per share (“EPS”) is calculated based on the loss fo
2016 01,
—
07,
21
Consolidated Financial Statements
09,
In September 2015, the FASB issued ASU 2015 16, which amends Topic 805, “Business Combinations.” This amendment eliminates the requirement
40, “Disclosure of Uncertainties about an Entity’s Ability to
continue as a Going Concern.” The amendments in this ASU provide guidance related to management’s responsibility to evaluate whether there is
substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The a
17, which amends ASC Topic 740, “Income Taxes.” This amendment aligns the present
ntracts with Customers,” supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition,” including most
35, “Revenue Recognition—
—Contracts with Customers.” In summary, the core principle of Topic 606 is
Type Contracts,” and creates new Subtopic 340 40, “Other
9 supe
Recognition,” and Topic 932, “Extractive Activities—Oil and Gas” and provide improvements to narrow aspects of ASU No. 2014
scind certain SEC Staff Observer comments that are codified in Topic 605, “Revenue
16
15,
22
Consolidated Financial Statements
18,
.
23
Consolidated Financial Statements
31, 2016
2017
3.2
4.4
14.9
21.7
,
The computation of basic loss per share (“EPS”) is based on the weighted average number of shares outstanding during the peri
10
2016 is 609,531
2017
478,292,500
258,631,442
31, 2016
77,505,000
10,096,146
436,762.
24
Jack
Asset transfers (“Galar”)
Asset transfer (“Galar”)
Consolidated Financial Statements
688.4
142.8
783.3
.
937.7
642.7
for Hull B364 (TBN “Saga”) and Hull B365 (TBN “Skald”), respectively. A fu
as newbuildings milestone payments for Hull B364 (TBN “Saga”) and Hull B365 (TBN “Skald”), respectively. Of the remaining US$
up
25
Consolidated Financial Statements
onerous contracts for Hull B366 (TBN “Tivar”), Hull B367 (TBN “Vale”) and Hull B368 (TBN “Var”).
up drilling rigs “Galar” and “Saga”, which were delivered in Nov
Acquisition of Hercules Triumph (“Ran”) and Hercules Resilience (“Frigg”)
,
(“Hercules”) to purchase the
“Business Combinations”
The PPL Rigs “Galar”, “Gerd”
“Gersemi”
,
“Business Combinations”
Transocean Inc (“Transocean”). The transaction consisted of Transocean’s entire jack
g eight rig owning companies in Transocean’s
26
Consolidated Financial Statements
Name of acquired company
547.7
0.5
324.5
32.0
288.7
3.8
324.5
324.5
324.5
y 1, 2017,
31, 2017,
$
1, 2017, Borr
$
27
for an understanding of the Group’s financial position. The calculated depreciation in Q1 2
1,
Consolidated Financial Statements
20.0
19.1
39.1
recognized in “Other comprehensive income” (“OCI”).
–
2.6
10.3
4.4
5.1
22.4
.
28
Consolidated Financial Statements
financing of the PPL rigs are not subject to financial covenants. The rig “Galar”
31, 2017,
Hull B366 (TBN “Tivar”), Hull B367 (TBN “
”) and Hull B368 (TBN “Var”). When entering into the agreement with Transocean a
87.0
71.3
158.3
.
2016
WAEP
2017
WAEP
9,155,000
9,155,000
3.60
3.60
29
Consolidated Financial Statements
of the Company’s financial instruments were as follows:
– non
1
1
1
1
2
2
1
1
2
164.0
39.1
20.7
15.4
60.6
87.0
9.6
11.5
56.2
164.0
39.1
20.7
15.4
60.6
87.0
9.6
11.5
56.2
138.1
13.0
138.1
13.0
0.2
0.2
Financial instruments included in the table above are included within ‘Level 1 and 2’ of the fair value hierarchy because the
(Bermuda) Limited ("M agni Partners") and 1,937,500 warrants were issued to Ubon Partners AS ("Ubon”).
30
Consolidated Financial Statements
0.01
2.00
0.41 1.9
25
M ay 1, 2019
July 5, 2019
,
In October 2017, the Company issued a further 4,736,887 warrants (“Warrants”) to Schlumberger as a consequence of a final col
s in Shareholders’
31
Consolidated Financial Statements
Of S hares
9,687,500
9,473,774
9,473,774
9,687,500
S hare
0.01
0.01
Contractual
5
31, 2017
Related party transactions
Holdings Limited (“
”)
Taran Holdings Limited (“Taran”),
against Taran’s subscription of shares in the Company’s first private placement in Decem
an’s payment obligations for its subscription of shares in the Company’s private placement in M arch 2017.
Advokatfirmaet Wiersholm AS (“Wiersholm”)
2.1
2017
,
32
Consolidated Financial Statements
.0
016.
s into the Statement of Changes in Shareholders’ Equity in the second quarter of 2017.
from M agni and Ubon (“Grantors”) through their individual companies, Primato AS (Rune M agnus Lundetr
US$2.0. The employees’ companies shall pay an option premium
o
Meritus Trust Company Limited (“Meritus”)
The majority of the Company’s transactions, assets and liabilities are denominated in U.S.
negative effect on the value of the Company’s cash flows. The Company has not entered into derivative agreements to mitigate
The Group’s listed equity securities are susceptible to market price risk arising from uncertainties about future values of t
n
n
33
Consolidated Financial Statements
newbuildings could have a negative impact on the Group’s reputation and customer relationships.
the Group’s business, financial condition and results of ope
.
low.
g
basis,
S hare capital and shareholders
The realizable value of the company’s assets would thereby be less its liabilities
the “Frigg”
2017
0.27
0.10
0.37
34
Consolidated Financial Statements
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
2,670
2,690
75,658,500
69,604,141
36,786,801
23,319,900
21,250,000
18,781,437
17,071,440
15,662,000
11,126,800
9,096,082
8,750,000
8,113,785
7,840,658
7,496,000
6,486,532
5,344,283
5,107,200
4,642,850
4,290,700
4,273,958
360,703,067
117,589,433
478,292,500
15.8%
14.6%
Skagen Kon
Brown Brothers
Dnb Luxembourg S.A.
J.P. M organ Bank Luxembourg S.A.
75.5%
24.5
100.0%
29, 2018.
Acquis
at US$5
$241.3
43
n
no
35
Consolidated Financial Statements
3, 2018
54,347,827
4.6
of “Gerd”, “Saga” and “Gersemi”
The newbuildings “Gerd” and “Gersemi” were delivered in January and February, respectively, from PPL. “Saga” was delivered in January 2018 from
27
“
”
17.0
on
In January 2018, the rig “Norve” commenced operation for BW Energy Dussafu B.V. (“BW Energy”) in Gabon. The contract duration
of 140 160 days
36
at the Board of Director’s Report includes a true and fair review of the development and performance of the business and the
8
_________________
___________________
__________________
___________________
Rask