Excluding reimbursable items, revenues increased to $427.2 million sequentially on two jackups and one floater commencing contracts and an increase in average daily revenue for both the floater and jackup fleets.

In Q3, the company got new contracts and extensions, with an associated contract backlog of around $465 million, increasing to $3.2 billion. 

Contract drilling expenses stood at $390.9 million (vs. $336.7 million in Q3 FY22). Adjusted EBITDA stood at $40.0 million vs. $83.5 million a year ago.

EPS of $0.17 was worse than the consensus of $0.28.

The Q3 FY23 results were lower than prior guidance, mainly due to lower-than-expected floater revenue efficiency and two contract commencement delays.

Capital expenditures increased to $106 million in Q3 from $71.0 million in Q2 2023. As of September 30, 2023, cash and equivalents stood at $1.1 billion.

Valaris repurchased $85 million of shares in Q3 and $171 million to date. The company reiterated the 2023 share repurchase target at $200 million.

Price Action: VAL shares closed lower by 3.14% at $66.96 on Monday.