"We continued to simplify and strengthen our business through 2023, achieving scale through the Aquadrill acquisition and delivering operational and financial results that allowed us to make meaningful returns to shareholders through our repurchase program," remarked President and Chief Executive Officer, Simon Johnson.

"We have long anticipated 2024 will be a year of transition. We have planned and prepared for a busy inventory of shipyard stays and accompanying capital expenditure. We continue to act proactively to manage and mitigate our exposure to contracting gaps and cost inflation when these appear. Though 2024 will certainly have some challenges, our optimism about the medium- and longer-term outlook for the offshore deepwater drilling industry and our competitive positioning within it remains positive and unchanged."

Financial and operational results

For the fourth quarter 2023, Seadrill recognized $408 million in total operating revenues. The Company generated $315 million in contract revenues, compared to $324 million the prior quarter, operating an average of 12 rigs at an economic utilization of 92.4%. These figures exclude the three drillships (West GeminiSonangol Quenguela, and Sonangol Libongos) the Company manages through Sonadrill, its 50:50 joint venture with Sonangol E.P., which generated an additional $73 million in management contract revenues. The Company earned an additional $20 million in reimbursable and other revenues, which includes bareboat charter income from Gulfdrill, a 50:50 joint venture between Seadrill and Gulf Drilling International. Operating expenses increased sequentially to $356 million from $304 million the prior quarter. The increase was primarily attributable to a change in provisions, repair and maintenance projects, severance, and personnel costs. Adjusted EBITDA(1) was $100 million, a $51 million decrease from the prior quarter.

Net cash provided by operating activities was $140 million for the fourth quarter, a $28 million, or 25%, sequential improvement compared to the third quarter. Capital expenditures totaled $90 million in the fourth quarter, compared to $61 million in the third quarter, and consisted of long-term maintenance costs of $42 million, included in operating cash flows, and $48 million of capital upgrades, related to contract preparation and incremental equipment spend. Resulting Free Cash Flow(1) for the fourth quarter was $92 million.

Full-year total operating revenues were approximately $1.5 billion, a 48% increase from $1.0 billion the prior year. Full-year operating profit was $329 million and full-year Adjusted EBITDA(1) was $495 million, or 33.0% of revenues, in line with guidance. The results reflect three quarters of earnings from rigs acquired through the Company’s Aquadrill transaction, which closed in April 2023.