Borr Drilling(BORR)2025-02-20 19:48Financial Data and Key Metrics Changes - Operating revenue increased by 136.7 million, an increase of 26.3 million, an increase of 0.11 [18] - Free cash position at the end of Q4 was 211.6 million [19] Business Line Data and Key Metrics Changes - Technical utilization rate was 98.9% and economic utilization rate was 97.1% [7] - Approximately 6,700 contracted rig days in 2025, representing 77% of total available rig days, at an average day rate of 136,000 in 2024 [11] Market Data and Key Metrics Changes - A weaker market was observed with rig suspensions in Saudi Arabia and Mexico, but this was partially offset by incremental demand in West Africa and Southeast Asia [8] - Modern rig market utilization stands at 93%, with just under 90% if adjusted for suspensions [28] - In Mexico, approximately twelve rigs or 45% of PEMEX's contracted fleet are currently suspended, affecting production levels [33] Company Strategy and Development Direction - The company has completed its new build program and will focus on reducing idle periods and strengthening backlog visibility into 2026 [10][36] - The board declared a cash distribution of 50 million [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong fundamentals of the global jackup market despite near-term uncertainties [9][39] - The company expects to face headwinds in the first quarter of 2025 due to rig suspensions but remains optimistic about the recovery in the second half of the year [12][34] - Management highlighted the importance of the Mexican government's commitment to stabilize production and payments, which is expected to positively impact operations [51][72] Other Important Information - The company secured 177,000 per day in 2024 [24] - The company has an existing share repurchase authorization which can be used opportunistically [13] Q&A Session Summary Question: Leading edge day rates - Management noted that leading edge day rates for benign market jackups have been around 130,000, with some markets experiencing higher competition [44][46] Question: Update on rigs in Mexico - Management confirmed that three temporarily suspended rigs are expected to return to work in the second quarter, with a strong focus on getting production back up [50][52] Question: Latest in Saudi Arabia - Management indicated that the situation in Saudi Arabia remains steady, with a focus on offshore gas work and potential large EPC contracts being awarded [56][58] Question: Future payment schedules in Mexico - Management acknowledged the challenges in payment regularity but expressed optimism about the government's efforts to stabilize the situation and increase private investments [67][72] Question: Dialogue with clients and contract timing - Management reported constructive discussions with clients, with an increasing number of opportunities building up in the pipeline for 2025 and 2026 [86][88] Question: Financial policy going forward - Management emphasized a focus on strengthening the balance sheet and conserving cash, with plans to evaluate debt repayment and share buybacks later in the year [106][108]