Valaris Ltd on Thursday reported $537.4 million in revenue for the fourth quarter of 2025, down 10 percent from the prior three-month period partly due to idle time for some rigs.
While Q4 net profit rose 281 percent quarter-on-quarter to $717.5 million, the increase was due to a tax benefit of $680 million, the Hamilton, Bermuda-based drilling contractor said in an online statement.
EBITDA adjusted for extraordinary or nonrecurring items dropped 41 percent sequentially to $97 million.
Revenue from floaters excluding reimbursable items decreased to $255.4 million from $293 million for Q3 “primarily due to drillships Valaris DS-15 and DS-18 completing contracts mid-third quarter without immediate follow-on work and semisubmersibles Valaris MS-1 and DPS-1 completing contracts mid-fourth quarter”, Valaris said. “Both drillships are scheduled to commence new contracts in the second half of 2026, while both semisubmersibles have been mobilized to Malaysia and are currently stacked”.
Floater contract expenses climbed on “higher repair costs associated with planned maintenance projects, an increase in accruals related to certain claims and higher mobilization expenses for Valaris DPS-1 and MS-1 given their mobilization to Malaysia”, Valaris said.
Revenue from jackups excluding reimbursable items fell to $208.8 million from $216.7 million for Q3 primarily due to the sale of Valaris 247 to BW Energy.
Revenue excluding reimbursable items from ARO Drilling, which Valaris equally co-owns with Saudi Arabian Oil Co, fell to $140 million from $157 million “primarily due to more out of service time related to planned shipyard projects for Valaris 116 and 250”, Valaris said. Contract expenses decreased due to lower bareboat charter expenses.
The company’s total operating income fell 70 percent quarter-on-quarter to $39.4 million.
At the end of the year, backlog stood at around $4.7 billion. “Since our last quarterly report, we secured nearly $900 million of additional backlog, further strengthening our robust contract coverage across 2026 and 2027”, said president and chief executive Anton Dibowitz.
“After addressing the white space on our open drillship capacity earlier this year, we recently announced contract awards for Valaris DS-7 and DS-9, and we expect all 10 of our active drillships to be working as we enter 2027, which was a key objective for us”.
Earlier Valaris signed a definitive agreement under which it would be acquired by Transocean Ltd in an all-stock transaction of around $5.8-billion. The parties expect the enlarged Transocean, which would be 47 percent owned by Valaris, to have an offshore fleet of 73 rigs consisting of 33 ultra-deepwater drillships, nine semisubmersibles and 31 modern jackups, according to a joint statement February 9.
Valaris ended 2025 with $1.23 billion in current assets including $599.4 million in cash and cash equivalents. Current liabilities totaled $691.6 million.
“We believe the outlook for the offshore drilling industry remains positive, with customers continuing to emphasize the need for sustained upstream investment to help ensure secure, reliable and affordable energy supply”, Dibowitz said.
To contact the author, email jov.onsat@rigzone.com
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