Noble (NE) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $195 million ($1.34 per diluted share), with Adjusted EBITDA of $271 million, up nearly 50% sequentially, driven by contract startups and improved fleet utilization.

• The board approved a 25% dividend increase to $0.50 per share for Q3 2024, the highest among US-listed oilfield services, with $470 million returned to shareholders since Q4 2022.

• The pending acquisition of Diamond Offshore is expected to close by Q1 2025, with Diamond shareholders to own 14.5% of the combined entity and annual pre-tax cost synergies of $100 million anticipated.

• $275 million in new contracts and extensions were signed since last quarter, strengthening the $4.2 billion backlog.

• Announced voluntary delisting from NASDAQ Copenhagen, maintaining NYSE as the primary listing.

Financial highlights

• Q2 2024 revenue was $693 million, up from $637 million in Q1 2024 and $639 million in Q2 2023.

• Adjusted EBITDA margin improved to 39% in Q2 2024 from 29% in Q1.

• Free cash flow was negative $26 million in Q2, impacted by higher CapEx and working capital.

• Net income for Q2 2024 was $195 million, with diluted EPS of $1.34.

• Net debt increased to $459 million, leverage ratio improved to 0.4x, and liquidity stood at $656 million.

Outlook and guidance

• 2024 revenue guidance narrowed to $2.65–$2.75 billion, with adjusted EBITDA guidance at $950–$1,000 million, weighted 52–54% to H2 2024.

• Guidance excludes impact from the Diamond Offshore acquisition.

• CapEx for 2024 maintained at $400–$440 million, with billable CapEx at $30 million.

• Free cash flow expected to be up slightly year-over-year, with a strong run rate exiting 2024.

• The company expects to fund capital additions with operating cash flow and cash on hand.