www.valaris.com

Press Release

Hamilton, Bermuda, April 30, 2025… Valaris Limited (NYSE: VAL) ("Valaris" or the "Company") today reported first quarter 2025 results.

President and Chief Executive Officer Anton Dibowitz said, “I’d like to thank the entire Valaris team for delivering another quarter of strong operational and financial performance. We continued our track record of providing safe and efficient operations for our customers, delivering revenue efficiency of 96% as well as meaningful EBITDA and free cash flow during the quarter.”

Dibowitz added, “We are also successfully executing our commercial strategy by securing attractive, long-term contracts for our high-specification fleet. The recent award for drillship VALARIS DS-10 offshore West Africa enhances our presence in a key deepwater region. Additionally, since the beginning of the year, we’ve had meaningful contracting success across our shallow-water fleet, including contracts for jackups in the Middle East, the North Sea, Australia and Trinidad. We remain actively engaged with customers for additional contracting opportunities in 2026 and beyond.”

Dibowitz concluded, “While macroeconomic uncertainty has increased recently, we expect offshore production will continue to play a vital role in meeting the world's energy needs and will be an important part of our customers' portfolios going forward. Given our high-quality fleet and operational performance, we believe Valaris is well positioned to secure additional contracts which, paired with our prudent fleet management, will further support our earnings and cash flow.”

•Total operating revenues of $621 million, with revenue efficiency of 96%;

•Net loss of $39 million, inclusive of $167 million of discrete tax expense;

•Adjusted EBITDA of $181 million;

•Generated $156 million of cash from operating activities and $74 million of Adjusted Free Cash Flow;

•Secured approximately $1.0 billion of new contract backlog since February's fleet status report, increasing total backlog by nearly 20% to more than $4.2 billion;

•Recognized by the International Association of Drilling Contractors ("IADC") North Sea Chapter with its 2024 Best Safety Performance Award for Jackup Rigs; and

•Sold semisubmersibles VALARIS DPS-3, DPS-5 and DPS-6 for recycling in April.

Net loss of $39 million compared to net income of $131 million in the fourth quarter 2024. Net loss included tax expense of $194 million, which is further described below, compared to a tax benefit of $7 million in the fourth quarter. Adjusted EBITDA increased to $181 million from $142 million in the fourth quarter primarily due to higher revenues for the floater fleet.

Revenues exclusive of reimbursable items increased to $578 million from $548 million in the fourth quarter 2024 primarily due to more operating days and higher average daily revenue for the floater fleet.

Exclusive of reimbursable items, contract drilling expense decreased to $374 million from $381 million in the fourth quarter 2024 primarily due to a non-cash accrual associated with a legal matter in the fourth quarter, partially offset by higher costs for the floater fleet associated with more operating days.

First quarter 2025 included an $8 million loss on impairment related to our decision to retire semisubmersibles VALARIS DPS-3, DPS-5 and DPS-6 during the quarter. General and administrative expense decreased to $24 million from $27 million in the fourth quarter 2024 primarily due to lower professional fees.

Other income increased to $11 million from $5 million in the fourth quarter 2024 primarily due to a gain on the sale of assets, including jackup VALARIS 75, partially offset by foreign currency exchange losses compared to gains in the fourth quarter.

Tax expense was $194 million compared to tax benefit of $7 million in the fourth quarter 2024. The first quarter 2025 tax provision included $167 million of discrete tax expense, which was primarily attributable to the establishment of a valuation allowance on deferred tax assets in a certain operating jurisdiction in connection with our decision to retire three semisubmersibles during the quarter. The fourth quarter tax provision included $16 million of discrete tax benefit, which was primarily attributable to changes in liabilities for unrecognized tax benefits associated with tax positions taken in prior years. Adjusted for discrete tax items, tax expense increased to $27 million from $9 million in the fourth quarter.

Capital expenditures decreased to $100 million from $112 million in the fourth quarter 2024 primarily due to VALARIS DS-4 undergoing a shipyard upgrade project during the fourth quarter as well as lower maintenance capital expenditures in the first quarter.

Cash and cash equivalents and restricted cash increased to $454 million as of March 31, 2025, from $381 million as of December 31, 2024. The increase was primarily due to cash flow from operations and asset sales, partially offset by capital expenditures.

Floaters

Revenues exclusive of reimbursable items increased to $356 million from $328 million in the fourth quarter 2024 due to more operating days and higher average daily revenue. The increase in operating days was primarily due to VALARIS DS-4 commencing a new contract offshore Brazil late in the fourth quarter, partially offset by VALARIS DS-12 completing a contract offshore Egypt in the first quarter. The increase in average daily revenue was primarily driven by VALARIS DS-15 commencing a new higher day rate contract offshore Brazil late in the fourth quarter.

Exclusive of reimbursable items, contract drilling expense decreased to $204 million from $211 million in the fourth quarter 2024. The decrease was primarily due to a non-cash accrual associated with a legal matter in the fourth quarter, partially offset by higher expense for VALARIS DS-4 following the rig's return to work as costs were capitalized during its shipyard upgrade project during the fourth quarter.

Jackups

Revenues exclusive of reimbursable items decreased to $186 million from $188 million in the fourth quarter 2024 primarily due to fewer operating days, including for planned repairs on VALARIS 249, partially offset by higher average daily revenues.

Exclusive of reimbursable items, contract drilling expense increased to $117 million from $114 million in the fourth quarter 2024 primarily due to an increase in repair costs associated with VALARIS 249.

ARO Drilling

Revenues decreased to $135 million from $136 million in the fourth quarter 2024. Contract drilling expense increased to $86 million from $82 million in the fourth quarter primarily due to higher bareboat charter expense.

Other

Revenues exclusive of reimbursable items increased to $36 million from $33 million in the fourth quarter 2024 primarily due to higher bareboat charter revenue from rigs leased to ARO, reflecting fewer out of service days for planned maintenance. Exclusive of reimbursable items, contract drilling expense decreased to $16 million from $18 million in the fourth quarter primarily due to lower survey costs associated with rigs leased to ARO.

nm - Not meaningful

(1) The full operating results included above for ARO are not included within our consolidated results and thus deducted under "Reconciling Items" and replaced with our equity in earnings of ARO.

(2) Our onshore support costs included within contract drilling expenses are not allocated to our operating segments for purposes of measuring segment operating income (loss) and as such, these costs are included in "Reconciling Items." Further, general and administrative expense and depreciation expense incurred by our corporate office are not allocated to our operating segments for purposes of measuring segment operating income (loss) and are included in "Reconciling Items."

As previously announced, Valaris will hold its first quarter 2025 earnings conference call at 9:00 a.m. CT (10:00 a.m. ET) on Thursday, May 1, 2025.

Valaris Limited (NYSE: VAL) is the industry leader in offshore drilling services across all water depths and geographies. Operating a high-quality rig fleet of ultra-deepwater drillships, versatile semisubmersibles, and modern shallow-water jackups, Valaris has experience operating in nearly every major offshore basin. Valaris maintains an unwavering commitment to safety, operational excellence, and customer satisfaction, with a focus on technology and innovation. Valaris Limited is a Bermuda exempted company. To learn more, visit the Valaris website at www.valaris.com.

Statements contained in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include words or phrases such as "anticipate," "believe," "estimate," "expect," "intend," "likely," "outlook," "plan," "project," "could," "may," "might," "should," "will" and similar words and specifically include statements regarding expected financial performance; expected utilization, day rates, revenues, operating expenses, cash flows, contract status, terms and duration, contract backlog, capital expenditures, insurance, financing and funding; the offshore drilling market, including supply and demand, customer drilling programs and the attainment of requisite permits for such programs, stacking of rigs, effects of new rigs on the market and effect of the volatility of commodity prices; expected work commitments, awards, contracts and letters of intent; scheduled delivery dates for rigs; performance and expected benefits of our joint ventures, including our joint venture with Saudi Aramco; timing of the delivery of the Saudi Aramco Rowan Offshore Drilling Company ("ARO") newbuild rigs and the timing of additional ARO newbuild orders; the availability, delivery, mobilization, contract commencement, availability, relocation or other movement of rigs and the timing thereof; rig reactivations; suitability of rigs for future contracts; divestitures of assets; general economic, market, business and industry conditions, including changing tariff policies, trade disputes, inflation and recessions, trends and outlook; general political conditions, including political tensions, conflicts and war; cybersecurity attacks and threats; uncertainty around the use and impacts of artificial intelligence applications; impacts and effects of public health crises, pandemics and epidemics; future operations; ability to renew expiring contracts or obtain new contracts; increasing regulatory complexity; targets, progress, plans and goals related to sustainability matters; the outcome of tax disputes; assessments and settlements; and expense management. The forward-looking statements contained in this press release are subject to numerous risks, uncertainties and assumptions that may cause actual results to vary materially from those indicated, including cancellation, suspension, renegotiation or termination of drilling contracts and programs; our ability to obtain financing, service our debt, fund capital expenditures and pursue other business opportunities; adequacy of sources of liquidity for us and our customers; future share repurchases; actions by regulatory authorities, or other third parties; actions by our security holders; internal control risk; commodity price fluctuations and volatility, customer demand, loss of a significant customer or customer contract, downtime and other risks associated with offshore rig operations; adverse weather, including hurricanes; changes in worldwide rig supply; and demand, competition and technology; supply chain and logistics challenges; consumer preferences for alternative fuels and forecasts or expectations regarding the global energy transition; increased scrutiny of our sustainability targets, initiatives and reporting and our ability to achieve such targets or initiatives; changes in customer strategy; future levels of offshore drilling activity; governmental action, civil unrest and political and economic uncertainties, including recessions, volatility affecting financial markets and the banking system, changing tariff policies, trade disputes, and adverse changes in the level of international trade activity; terrorism, piracy and military action; risks inherent to shipyard upgrade, repair, maintenance, enhancement or rig reactivation; our ability to enter into, and the terms of, future drilling contracts; suitability of rigs for future contracts; the cancellation of letters of intent or letters of award or any failure to execute definitive contracts following announcements of letters of intent, letters of award or other expected work commitments; the outcome of litigation, legal proceedings, investigations or other claims or contract disputes; governmental regulatory, legislative and permitting requirements affecting drilling operations; our ability to attract and retain skilled personnel on commercially reasonable terms; the use of artificial intelligence by us, third-party service providers or our competitors; environmental or other liabilities, risks or losses; compliance with our debt agreements and debt restrictions that may limit our liquidity and flexibility, including in any return of capital plans; cybersecurity risks and threats; and changes in foreign currency exchange rates. In addition to the numerous factors described above, you should also carefully read and consider "Item 1A. Risk Factors" in Part I and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II of our most recent annual report on Form 10-K, which is available on the Securities and Exchange Commission's website at www.sec.gov or on the Investor Relations section of our website at www.valaris.com. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to update or revise any forward-looking statements, except as required by law.

VALARIS LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

			Three Months Ended
			Mar 31, 2025			Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024
OPERATING ACTIVITIES
Net income (loss)			$	(39.2)		$	130.6		$	62.9		$	150.8		$	25.5
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Deferred income tax expense (benefit)			169.8			(13.5)			3.8			13.5			2.0
Depreciation expense			33.1			33.9			31.7			29.7			26.8
Net (gain) loss on sale of property			(27.1)			(0.1)			0.2			—			0.1
Loss on impairment			7.8			—			—			—			—
Accretion of discount on notes receivable from ARO			(6.1)			(6.2)			(6.2)			(20.6)			(7.0)
Share-based compensation expense			5.6			5.3			7.0			7.4			8.0
Equity in losses (earnings) of ARO			(2.6)			(10.7)			23.8			0.3			(2.4)
Changes in contract liabilities			(17.8)			(18.2)			11.3			(17.8)			(7.0)
Changes in deferred costs			(0.2)			6.7			33.4			(3.0)			2.2
Other			2.3			1.9			0.8			2.4			1.8
Changes in other operating assets and liabilities			35.3			(3.2)			37.8			(147.5)			(21.3)
Contributions to pension plans and other post-retirement benefits			(5.0)			(1.9)			(13.5)			(3.7)			(2.4)
Net cash provided by operating activities			$	155.9		$	124.6		$	193.0		$	11.5		$	26.3
INVESTING ACTIVITIES
Additions to property and equipment			$	(100.2)		$	(111.7)		$	(81.9)		$	(110.2)		$	(151.3)
Proceeds from disposition of assets			17.8			2.6			0.1			0.1			—
Net cash used in investing activities			$	(82.4)		$	(109.1)		$	(81.8)		$	(110.1)		$	(151.3)
FINANCING ACTIVITIES
Payments for tax withholdings for share-based awards			$	(0.3)		$	(0.2)		$	(29.3)		$	(0.2)		$	(0.2)
Payments for share repurchases			—			(25.0)			(100.0)			—			(1.4)
Other			—			(2.0)			—			—			—
Net cash used in financing activities			$	(0.3)		$	(27.2)		$	(129.3)		$	(0.2)		$	(1.6)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH			$	73.2		$	(11.7)		$	(18.1)		$	(98.8)		$	(126.6)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD			380.5			392.2			410.3			509.1			635.7
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD			$	453.7		$	380.5		$	392.2		$	410.3		$	509.1

(1)Reimbursable revenues represent reimbursements from our customers for purchases of supplies, equipment and incremental services provided at their request.

(1)Adjusted EBITDA is earnings before interest, tax, depreciation, amortization and loss on impairment. Adjusted EBITDA for asset category also excludes onshore support costs and general and administrative expense.

(1)Our contract drilling backlog reflects commitments, represented by signed drilling contracts, and is calculated by multiplying the contracted day rate by the contract period. Contract drilling backlog may include drilling contracts subject to final investment decision ("FID") and drilling contracts which grant the customer termination rights if FID is not received with respect to projects for which the drilling rig is contracted. The contracted day rate excludes certain types of lump sum fees for rig mobilization, demobilization, contract preparation, as well as customer reimbursables and bonus opportunities.

(1)Average daily revenue is derived by dividing Revenues (exclusive of reimbursable revenues), excluding contract termination fees, by the aggregate number of operating days.

(1)Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the total fleet. Available days is defined as the maximum number of days available in the period for the total fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, irrespective of asset status.

(2)Includes all Valaris jackups including those leased to ARO Drilling.

(1)Rig utilization is derived by dividing the number of operating days by the number of available days in the period for the active fleet. Available days is defined as the maximum number of days available in the period for the active fleet, calculated by multiplying the number of rigs in each asset category by the number of days in the period, for active rigs only. Active rigs are defined as rigs that are not preservation stacked.

(2)Active fleet represents rigs that are not preservation stacked or held for sale and includes rigs that are in the process of being reactivated.

(3)Includes all Valaris jackups including those leased to ARO Drilling.

(1)Represents the total number of days under contract in the period. Days under contract equals the total number of days that rigs have earned and recognized day rate revenue, including days associated with compensated downtime and mobilizations. When revenue is deferred and amortized over a future period, for example when we receive fees while mobilizing to commence a new contract or while being upgraded in a shipyard, the related days are excluded from days under contract.

(1)Revenue efficiency is day rate revenue earned as a percentage of maximum potential day rate revenue.

(1)Active fleet represents rigs that are not preservation stacked or held for sale and includes rigs that are in the process of being reactivated.

(2)Represents VALARIS DPS-5, VALARIS DPS-3 and VALARIS DPS-6, which were classified as held for sale as of March 31, 2025.

(3)Leased rigs and managed rigs included in Other reporting segment.