<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
AMENDMENT NO. 1
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
APRIL 22, 1994
NOBLE DRILLING CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 0-13857 73-0374541
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
10370 Richmond Avenue, Suite 400, Houston, Texas 77042
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(713) 974-3131
<PAGE> 2
AMENDMENT NO. 1
Amend Item 7. Financial Statements and Exhibits by deleting such item
in its entirety and substituting therefor the following:
(a) Financial Statements of Businesses Acquired
Financial Statements of Triton Engineering Services Company
("Triton") filed as a part of this report:
Audited Financial Statements:
Report of Independent Public Accountants
Consolidated Balance Sheets at December 31, 1993 and 1992
Consolidated Statements of Income for the years ended December
31, 1993 and 1992
Consolidated Statements of Stockholders' Equity for the years
ended December 31, 1993 and 1992
Statements of Consolidated Cash Flows for the years ended
December 31, 1993 and 1992
Notes to Consolidated Financial Statements
Unaudited Interim Financial Statements:
Consolidated Balance Sheet at March 31, 1994
Consolidated Statement of Income for the quarter ended March
31, 1994
Statement of Consolidated Cash Flows for the quarter ended
March 31, 1994
Notes to Consolidated Financial Statements
(b) Pro Forma Financial Information
Unaudited Pro Forma Condensed Consolidated Balance Sheet and Notes
as of March 31, 1994
Unaudited Pro Forma Condensed Consolidated Statements of Operations
and Notes for the quarter ended March 31, 1994 and the year
ended December 31, 1993
(c) Exhibits
Exhibit 2.1 - Stock Purchase Agreement dated April
22, 1994 among Joseph E. Beall
("Beall"), George H. Bruce
("Bruce"), Triton and Noble Drilling
Corporation (the "Registrant") (filed
as Exhibit 2.1 to the Registrant's
Form 8-K dated May 6, 1994 and
incorporated herein by reference).
Exhibit 10.1 - Registration Agreement dated April
22, 1994 between the Registrant and
Beall (filed as Exhibit 10.1 to the
Registrant's Form 8-K dated May 6,
1994 and incorporated herein by
reference).
<PAGE> 3
Exhibit 10.2 - Employment Agreement dated April 22,
1994 between Triton and Beall
(filed as Exhibit 10.2 to the
Registrant's Form 8-K dated May 6,
1994 and incorporated herein by
reference).
Exhibit 10.3 - Lease Indemnity Agreement dated
April 22, 1994 among Beall, Triton,
1201 Dairy Ashford Ltd. and the
Registrant (filed as Exhibit 10.3 to
the Registrant's Form 8-K dated May
6, 1994 and incorporated herein by
reference).
Exhibit 99.1 - News release dated April 25, 1994
(filed as Exhibit 99.1 to the
Registrant's Form 8-K dated May 6,
1994 and incorporated herein by
reference).
<PAGE> 4
NOBLE DRILLING CORPORATION AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
AND PRO FORMA FINANCIAL INFORMATION
DESCRIPTION PAGE
- - ----------------------------------------------------- ----
ITEM 7.(A) AUDITED FINANCIAL STATEMENTS:
Report of Independent Public Accountants 5
Consolidated Balance Sheets at December 31, 1993
and 1992 6
Consolidated Statements of Income for the years
ended December 31, 1993 and 1992 7
Consolidated Statements of Stockholders' Equity
for the years ended December 31, 1993 and 1992 8
Statements of Consolidated Cash Flows for the years
ended December 31, 1993 and 1992 9
Notes to Consolidated Financial Statements 10
UNAUDITED INTERIM FINANCIAL STATEMENTS:
Consolidated Balance Sheet at March 31, 1994 20
Consolidated Statement of Income for the
quarter ended March 31, 1994 21
Statement of Consolidated Cash Flows for the
quarter ended March 31, 1994 22
Notes to Consolidated Financial Statements 23
ITEM 7.(B) PRO FORMA FINANCIAL INFORMATION:
Unaudited Pro Forma Condensed Consolidated Balance
Sheet and Notes as of March 31, 1994 25
Unaudited Pro Forma Condensed Consolidated Statement
of Operations and Notes for the quarter ended
March 31, 1994 26
Unaudited Pro Forma Condensed Consolidated
Statement of Operations and Notes for the
year ended December 31, 1993 27
<PAGE> 5
(LOGO) KPMG Peat Marwick
Certified Public Accountants
700 Louisiana Telephone 713 224 4262 Telecopier 713 224 4566
P.O. Box 4545 Telex 286705 PMMT UR (RCA)
Houston, TX 77210-4545
Independent Auditors' Report
The Board of Directors and Stockholders
Triton Engineering Services Company:
We have audited the accompanying consolidated balance sheets of Triton
Engineering Services Company and subsidiaries as of December 31, 1993 and 1992,
and the related consolidated statements of income, stockholders' equity and
cash flows for the years then ended. These consolidated financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Triton Engineering
Services Company and subsidiaries at December 31, 1993 and 1992, and the
results of their operations and their cash flows for the years then ended in
conformity with generally accepted accounting principles.
As discussed in Notes 2 and 6 to the consolidated financial statements, the
Company changed its method of accounting for income taxes to adopt the
provisions of Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes," as of January 1, 1993.
As discussed in Note 14 to the consolidated financial statements, the Company's
Board of Directors have executed a letter of intent to sell all of the
outstanding shares of common stock of the Company. The accompanying
consolidated financial statements do not include any adjustments relating to
the recoverability and classification of recorded asset amounts or the amounts
and classifications of liabilities that might result from the sale.
/s/ KPGM PEAT MARWICK
Houston, Texas
March 4,1994
Member Firm of
(LOGO) Klynveld Peat Marwick Goerdeler
<PAGE> 6
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, 1993 and 1992
<TABLE>
<CAPTION>
Assets 1993 1992
------ ---- ----
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 15,030,286 1,055,790
Accounts receivable:
Trade, net of allowance of $290,000
in 1993 and $-0- in 1992 (note 13) 42,498,255 8,227,132
Unbilled 1,928,760 409,651
Other (note 12) 2,780,444 67,319
Inventory 3,340,045 3,647,470
Prepaid expenses 900,947 1,418,979
Costs of uncompleted contracts in excess of
related billings (note 2) 1,108,994 1,362,591
------------ ----------
Total current assets 67,587,731 16,188,932
------------ ----------
Property and equipment:
Drilling equipment 4,737,784 4,696,393
Furniture, fixtures and equipment 1,615,554 1,479,355
Leasehold improvements 333,684 333,684
Oil and gas properties 1,183,021 1,795,891
------------ ----------
7,870,043 8,305,323
Less accumulated depreciation and depletion 5,351,755 4,933,755
------------ ----------
2,518,288 3,371,568
------------ ----------
Due from stockholder (note 9) 198,303 98,303
Assets held for sale (note 2) -- 645,094
Deferred income taxes (note 6) 574,070 --
Investment in assets of unconsolidated affiliates (notes 3 and 4) 1,292,576 12,624,812
------------ ----------
$ 72,170,968 32,928,709
------------ ----------
------------ ----------
Liabilities and Stockholders' Equity
------------------------------------
Current liabilities:
Accounts payable 33,309,160 6,670,521
Billings of uncompleted contracts in excess
of related costs 2,576,012 --
Accrued liabilities 4,292,367 5,942,572
Accrued loss on uncompleted contract (note 14) 1,466,999 --
Income taxes payable (note 6) 3,427,603 1,794,560
Deferred income taxes (note 6) 3,236,425 2,779,215
Note payable 306,672 --
Note payable to bank (note 5) 1,500,000 --
------------ ----------
Total current liabilities 50,115,238 17,186,868
------------ ----------
Deferred income taxes (note 6) -- 844,333
------------ ----------
Minority interest in joint venture (note 3) 6,899,556 --
------------ ----------
Total liabilities 57,014,794 18,031,201
------------ ----------
Stockholders' equity (notes 8 and 10):
Common stock, no par value. Authorized 2,000,000 shares;
11,971 shares issued 11,971 11,971
Retained earnings 19,450,653 17,877,987
Treasury stock, 6,791 and 6,346 common shares, at cost,
at December 31, 1993 and 1992, respectively (4,306,450) (2,992,450)
------------ ----------
Total stockholders' equity 15,156,174 14,897,508
Commitments and contingencies (notes 5, 7, 8, 11 and 12)
------------ ----------
$ 72,170,968 32,928,709
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 7
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 1993 and 1992
<TABLE>
<CAPTION>
1993 1992
---- ----
<S> <C> <C>
Revenues:
Turnkey drilling operations (note 3) $ 89,407,120 18,799,852
Daywork services 20,595,769 1,215,074
Engineering services 7,811,893 8,975,776
Supply services and other 6,018,986 8,605,793
------------ ----------
123,833,768 37,596,495
Direct expenses (notes 3, 12 and 14) 103,128,414 26,066,217
------------ ----------
Gross profit 20,705,354 11,530,278
Operating expenses 12,374,158 10,474,742
------------ ----------
Operating income 8,331,196 1,055,536
------------ ----------
Other income (expense):
Equity in net income (loss) of
unconsolidated affiliates:
Joint venture (Mexican turnkey drilling contracts) (note 3) -- 4,577,382
Partnership (1201 Dairy Ashford, Ltd.) (note 4) (94,336) (93,131)
Loss on permanent impairment of investment in partnership (note 4) -- (334,162)
Interest income 293,389 303,005
Interest expense (335,810) (45,299)
Gain on sale of property and equipment 91,068 305,288
Other 209,836 453,483
------------ ----------
164,147 5,166,566
------------ ----------
Income before income tax provision and minority interest 8,495,343 6,222,102
Income tax provision (note 6) 2,222,007 4,225,367
Minority interest (note 3) 4,766,955 --
------------ ----------
Income before cumulative effect of accounting change 1,506,381 1,996,735
Cumulative effect of change in accounting for
income taxes (notes 2 and 6) 66,285 --
------------ ----------
Net income $ 1,572,666 1,996,735
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 8
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the years ended December 31, 1993 and 1992
<TABLE>
<CAPTION>
Shares of
common Total
stock Common Retained Treasury stockholders'
outstanding stock earnings stock equity
----------- ------ -------- -------- -------------
<S> <C> <C> <C> <C> <C>
Balance, January 1, 1992 5,625 $ 11,971 15,881,252 (2,992,450) 12,900,773
Net income -- -- 1,996,735 -- 1,996,735
----- -------- ---------- ---------- ----------
Balance, December 31, 1992 5,625 11,971 17,877,987 (2,992,450) 14,897,508
----- -------- ---------- ---------- ----------
Purchase of treasury stock (note 8) (445) -- -- (1,314,000) (1,314,000)
Net income -- -- 1,572,666 -- 1,572,666
----- -------- ---------- ---------- ----------
Balance, December 31, 1993 5,180 $ 11,971 19,450,653 (4,306,450) 15,156,174
----- -------- ---------- ---------- ----------
----- -------- ---------- ---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 9
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
For the years ended December 31, 1993 and 1992
<TABLE>
<CAPTION>
1993 1992
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,572,666 1,996,735
Adjustments to reconcile net income to net cash provided by
operating activities:
Allowance for doubtful accounts 290,000 --
Minority interest 4,766,955 --
Depreciation, depletion and amortization 1,169,943 1,709,551
Loss on uncompleted contract 1,466,999
Deferred income taxes (961,193) 1,874,569
Equity in net income of unconsolidated affiliates 94,336 (4,150,089)
Gain on sale of property and equipment (91,068) (305,288)
Changes in assets and liabilities:
Decrease (increase) in:
Accounts receivable (4,046,608) 1,012,761
Inventory 632,159 (95,467)
Prepaid expenses 518,032 (87,234)
Due from stockholder (100,000) (98,303)
Costs of uncompleted contracts in excess of related billings 253,597 (1,362,591)
Increase (decrease) in:
Accounts payable 22,318,903 3,660,655
Accrued liabilities (14,922,053) 3,359,988
Billings of uncompleted contracts in excess of related costs 2,576,012 --
Income taxes payable 1,633,043 487,091
------------ ----------
Net cash provided by operating activities 17,171,723 8,002,378
------------ ----------
Cash flows used in investing activities:
Advances to and on behalf of joint venture -- (6,616,518)
Reimbursement of advances to joint venturer (1,383,482) --
Distribution to joint venturer (2,444,780) --
Repayments of advances made to partnership 44,000 114,940
Property and equipment additions (687,831) (892,919)
Proceeds from sale of property and equipment 782,194 547,495
------------ ----------
Net cash used in investing activities (3,689,899) (6,847,002)
------------ ----------
Cash flows provided by (used in) financing activities:
Proceeds from note payable to bank 1,500,000 --
Repayments of note payable (93,328) --
Repayment of subordinated debt -- (5,000,000)
Purchase of treasury stock (914,000) --
------------ ----------
Net cash provided by (used in) financing activities 492,672 (5,000,000)
------------ ----------
Net increase (decrease) in cash and cash equivalents 13,974,496 (3,844,624)
Cash and cash equivalents, beginning of year 1,055,790 4,900,414
------------ ----------
Cash and cash equivalents, end of year $ 15,030,286 1,055,790
------------ ----------
------------ ----------
Interest paid $ 335,810 89,110
------------ ----------
------------ ----------
Income taxes paid $ 1,483,169 1,863,709
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 10
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1993 and 1992
(1) CONSOLIDATED ENTITIES
Triton Engineering Services Company and its wholly-owned subsidiaries
("Triton" or the "Company") provide specialized technical services to the
upstream segment of the petroleum industry. The Company drills oil and gas
wells worldwide, onshore and offshore, for clients on a fixed-fee turnkey
basis, providing all engineering, equipment, materials, services and
management required. In addition, it provides project management,
engineering for drilling and production projects, daywork services,
operations supervision, consulting and supply services. The Company's
subsidiaries are:
Triton USA, Inc.
Triton International, Inc.
Triton Tool and Supply, Inc.
Triton International Limited
Triton Engineering Services Company, S.A.
Triton Engineering Services Company Limited
Triton Turn-Key, Inc.
Threadneedle Oil Company
1201 Dairy Ashford, Inc.
Triton/Faja de Oro Joint Venture
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiaries. The Company's 50% interest in
Triton/Faja de Oro Joint Venture has also been consolidated in 1993; in
1992 such investment was accounted for under the equity method (see note
3). All significant intercompany accounts and transactions have been
eliminated in consolidation. Investments in unconsolidated affiliates are
accounted for under the equity method.
BASIS OF PRESENTATION
As described in note 6, the consolidated financial statements for 1993
reflect the adoption of Financial Accounting Standards Board Statement No.
109, "Accounting for Income Taxes" (Statement 109), effective January 1,
1993.
RECOGNITION OF REVENUE FROM SERVICE AND TURNKEY DRILLING CONTRACTS
The Company performs engineering services under contractual arrangements
and recognizes revenues as services are rendered or as reimbursable
expenses are incurred.
Revenues on turnkey drilling contracts are recorded using the
completed-contract method for financial reporting purposes. The
completed-contract method recognizes income only if the contract is
completed, or substantially completed, unless the contract is estimated to
result in a loss, whereby provision is made immediately for the entire
anticipated loss.
(Continued)
<PAGE> 11
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
CASH EQUIVALENTS
For presentation of cash flows, the Company considers all highly liquid
debt instruments purchased with an original maturity of three months
or less to be cash equivalents.
INVENTORY
Inventory is valued at the lower of cost, determined on a
weighted-average basis, or market. No valuation allowance was deemed
necessary at December 31, 1993 or 1992.
PROPERTY AND EQUIPMENT
Furniture, Fixtures and Equipment, Drilling Equipment and Leasehold
Improvements
Furniture, fixtures and equipment, drilling equipment and leasehold
improvements are stated at cost. Depreciation is calculated on the
straight-line method over the estimated useful lives ranging from three to
seven years. Leasehold improvements are amortized straight-line over the
shorter of the lease term or the estimated useful life of the asset.
Maintenance and repairs are charged to expense as incurred. When property
is retired or otherwise disposed of, the related cost and accumulated
depreciation are removed from the respective accounts with any gain or
loss on disposal included in income.
Oil and Gas Properties
The Company utilizes the full-cost method to account for its investment in
oil and gas properties. Under this method, all costs of
acquisition, exploration and development of oil and gas reserves
(including such costs as leasehold acquisition costs, geological
expenditures, dry hole costs and tangible and intangible development
costs) are capitalized as incurred. Oil and gas properties are depleted
and charged to operations using the unit-of-production method based on
the ratio of current production to proved oil and gas reserves.
Dispositions of oil and gas properties are recorded as adjustments to
capitalized costs, with no gain or loss recognized unless such adjustments
would alter significantly the relationship between capitalized costs and
proved reserves of oil and gas. During 1993, the Company sold a
significant portion of its oil and gas properties, resulting in the
recognition of a gain of $63,776; the Company had no significant
dispositions during 1992. To the extent that capitalized costs of oil and
gas properties, net of accumulated depreciation and depletion, exceed the
discounted future net revenues of proved oil and gas reserves, such excess
capitalized costs would be charged to operations. A valuation provision of
$228,340 was required for the year ended December 31, 1992, and is
included in operating expenses; no such provision was required in 1993.
ASSETS HELD FOR SALE
During 1993, the Company transferred approximately $320,000 and $325,000
of jar parts classified as assets held for sale at December 31, 1992
to property and equipment and inventory, respectively, as the Company no
longer intends to actively market the jar parts for sale, instead, using
such items in its drilling operations.
(Continued)
<PAGE> 12
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
The Financial Accounting Standards Board has issued Statements of Financial
Accounting Standards No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions," ("Statement 106") and No. 112, "Employers'
Accounting for Postemployment Benefits" ("Statement 112"). Statement 106
focuses principally on accounting for postretirement health care benefits,
requiring accrual of the expected cost of those benefits during the period
in which the employee provides service, and for the Company is effective
for fiscal years beginning after December 15, 1994. Statement 112 requires
employers to recognize the obligation to provide postemployment benefits
unless the amount cannot be reasonably estimated; Statement 112 is
effective for fiscal years beginning after December 15, 1993. The Company
does not believe the implementation of Statement 106 or Statement 112,
will have a material impact on its financial position.
(3) JOINT VENTURE OPERATIONS
During 1992, the Company entered into a 50/50 joint venture agreement (the
"Joint Venture") with Perforadora Faja de Oro, S.A. de C.V. ("Faja") to
perform four turnkey drilling contracts ("the Contracts") for Petroleos
Mexicanos ("Pemex"), the government-owned Mexican oil company.
In exchange for a 50% share of the profits of the Joint Venture, the
Company agreed to provide technical support and advice to Faja with
respect to the preparation of bids, the preparation of drilling programs,
and engineering and supervisory support during operations.
Pursuant to the terms of the agreement, Faja provided initial funding of
up to $4,000,000 per well to cover expenses that were paid prior to
collection from Pemex. The advance from Faja was repaid during January
1993.
In 1992, the investment in the Joint Venture was accounted for using the
equity method.
At December 31, 1992 the Joint Venture had completed two of the four
contracts.
As Triton has significant influence over the activities of the Joint
Venture and as the advances made by Faja were settled by the Joint Venture
during January 1993, the Company began accounting for the investment in
the Joint Venture through consolidation of its operations and financial
position.
The Company, through its wholly-owned subsidiary Triton Tool and Supply,
Inc. (TTS), furnishes the Joint Venture with supplies, services and
rentals of equipment at prices comparable to those TTS offers its best
customers. The Joint Venture has no obligation to purchase from TTS.
Included in the Company's revenues and gross profits at December 31, 1992
were $3,058,990 and $626,987, respectively, related to sales from TTS to
the Joint Venture.
(Continued)
<PAGE> 13
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company also obtains supplies, equipment and services from third parties on
behalf of the Joint Venture. The cost to the Company is rebilled in full to the
Joint Venture. Receivables for reimbursement of purchases made on behalf of
the Joint Venture are included in investments in unconsolidated affiliates at
December 31, 1992.
Profits, losses and net distributions are allocated 50% to the Company and 50%
to Faja. Distribution of the proceeds of the Pemex contracts are 1) to pay all
amounts owed to third parties, 2) to reimburse advances made by the Company and
Faja to or on behalf of the Joint Venture and 3) to distribute remaining
profits. Seventy-five percent of the remaining profit will be distributed
within 10 days of the determination of the net profit, and the remaining 25%
will be distributed within four months thereafter.
The following details the Company's investment in the Joint Venture, which is
included in investment in assets of unconsolidated affiliates at December 31,
1992:
1992
----
Advances to and for expenses paid
on behalf of the Joint Venture $ 6,616,518
Equity in Joint Venture income 4,577,382
-----------
Total $11,193,900
-----------
-----------
Summarized unaudited financial information for the Joint Venture at December
31, 1992 is as follows:
1992
----
Assets:
Current assets $34,746,348
-----------
-----------
Liabilities:
Current liabilities 17,591,584
Advances from venturers 8,000,000
Undistributed earnings 9,154,764
-----------
34,746,348
-----------
-----------
Revenues 34,744,770
Less expenses 25,590,006
-----------
Net income $ 9,154,764
-----------
-----------
The Joint Venture had revenues of $44,969,662 and net income of $9,533,910
during the year ended December 31, 1993.
(Continued)
<PAGE> 14
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(4) INVESTMENT IN UNCONSOLIDATED AFFILIATES
The Company has a 10.44% investment in 1201 Dairy Ashford, Ltd. (the
Partnership) through its wholly-owned subsidiary, 1201 Dairy Ashford,
Inc., which serves as the general partner for the Partnership. An officer
and certain directors of the Company are limited partners in the
Partnership. Profits are to be allocated 100% to the partners, according
to their respective percentage interest, until the limited partners are
reimbursed in full for their initial and supplemental, if any, capital
contributions. The remaining profits shall be allocated 50% to the limited
partners and 50% to the general partner until the aggregate balance of all
limited partner accounts equals $250,000 (the initial limited partners'
aggregate investment), less any distributions to the limited partners
after February 26, 1987. Any remaining profits shall be allocated 100% to
the general partner. All losses are to be allocated 100% to the general
partner.
The Company leases office space from the Partnership. Rental expense
related to the lease was $404,684 for 1993 and 1992. Minimum annual
rentals of $404,684 are due under the lease, which expires on January 31,
2006. In addition, the Company is obliged to pay the operating costs, as
defined, of the property subject to the lease. Such operating costs were
$302,481 and $322,889 for 1993 and 1992, respectively.
The Company holds two noninterest-bearing notes issued by the Partnership.
One note in the original amount of $1,701,215 is secured by a lien on the
land and building owned by the Partnership, and the second note in the
original amount of $1,000,000 is unsecured. A note payable to a third
party in the original amount of $2,600,000 is also secured by a lien on
the land and building. The third party note, which matures on February 1,
2016, is callable by the lenders on February 1, 2001. The Company's lien
is subordinate to the third party lien.
The Company's 1993 operations include a loss of $94,336 representing the
Company's equity in the Partnership's loss. The Company's 1992 operations
include a loss of $93,131 representing the Company's equity in the
partnership's loss and a charge of $334,162 to write down the Company's
investment in the Partnership to its estimated net realizable value, as
the liabilities of the Partnership exceed the appraised value of the
Partnership's assets. No additional impairment was recorded during 1993.
The following details the Company's investment in the Partnership,
accounted for using the equity method, at December 31, 1993 and 1992:
1993 1992
---- ----
Secured note $1,701,215 1,701,215
Unsecured note 623,297 667,297
Equity in partnership loss (697,774) (603,438)
Reserve for impairment of value (334,162) (334,162)
---------- ---------
Total $1,292,576 1,430,912
---------- ---------
---------- ---------
(Continued)
<PAGE> 15
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following is selected unaudited financial data of the Partnership at
December 31, 1993 and 1992:
1993 1992
---- ----
Assets:
Land $ 1,453,270 1,453,270
Building and leasehold improvements 4,220,792 4,220,792
Accumulated depreciation (2,789,604) (2,564,461)
----------- ----------
Net property 2,884,458 3,109,601
Current assets 2,420 22,591
----------- ----------
Total assets $ 2,886,878 3,132,192
----------- ----------
----------- ----------
1993 1992
---- ----
Liabilities and partners' deficit:
Current liabilities $ -- 79,293
Note payable - third party 2,526,701 2,554,386
Notes payable/advances - Triton 2,324,512 2,368,512
----------- ----------
Total liabilities 4,851,213 5,002,191
Partners' deficit (1,964,335) (1,869,999)
----------- ----------
Total liabilities and partners' deficit $ 2,886,878 3,132,192
----------- ----------
----------- ----------
(5) DEBT AND CREDIT AGREEMENTS
On June 2, 1992, the Company obtained a working capital line of credit in
the amount of $1,500,000 maturing on May 2, 1993. The line of credit was
extended during 1993 to June 1, 1994. The line of credit is secured by
assignment of accounts receivable and inventory owned and subsequently
acquired. The Company was not in compliance with certain covenants at
December 31, 1993. Borrowings outstanding under the line of credit bear
interest at the prime rate (as published by the Wall Street Journal) plus
1/2 of one percentage point (6.5% at December 31, 1993). At December 31,
1993, $1,500,000 was outstanding under the line of credit.
(6) INCOME TAXES
As discussed in Note 2, the Company adopted Statement 109 effective
January 1, 1993. Statement 109 requires a change from the deferred method
to the asset and liability method of accounting for income taxes. Under
the asset and liability method, deferred income taxes are recognized for
the tax consequences of temporary differences by applying enacted
statutory tax rates applicable to future years to differences between the
financial statement carrying amounts and the tax bases of existing assets
and liabilities. Under Statement 109, the effect on deferred taxes of a
change in tax rates is recognized in income in the period that includes
the enactment date. Deferred tax assets and liabilities are measured using
enacted tax rates in effect for the year in which those temporary
differences are expected to be recovered or settled.
(Continued)
<PAGE> 16
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The cumulative effect on prior years of the adoption of Statement No. 109
increased net earnings by $66,285 and is reported separately in the
consolidated statement of income for the year ended December 31, 1993. Prior
year financial statements were not restated.
The income tax provision consists of the following for the years ended December
31, 1993 and 1992.
1993 1992
---- ----
Current provision - U.S. $ 937,106 376,428
Current provision - Foreign 592,040 1,286,998
Deferred provision - U.S. (894,908) 1,874,569
Foreign withholding taxes 1,587,769 687,372
---------- ---------
Income tax provision $2,222,007 4,225,367
---------- ---------
---------- ---------
The primary reasons for the difference in the statutory tax rate and the
effective tax rate are the taxation of foreign earnings at rates in excess of,
and in addition to, the U.S. statutory rate and the limitation of foreign tax
credit utilization. The Company utilized foreign tax credits of $1,044,612 and
$887,113 in 1993 and 1992, respectively.
The tax effects of temporary differences that result in significant portions of
the deferred income tax assets and liabilities at December 31, 1993 and a
description of the financial statement items creating these differences are as
follows:
Deferred tax assets:
Foreign tax credit carryforwards $ 2,243,515
Alternative minimum tax credit 66,022
UNICAP 85,351
-----------
Total deferred tax assets 2,394,888
-----------
Deferred tax liabilities:
Property and equipment (34,990)
Accrual to cash (3,321,776)
Other (483,520)
-----------
Total deferred tax liabilities (3,840,286)
Less valuation allowance (1,216,957)
-----------
Net deferred tax liability $(2,662,355)
-----------
-----------
The foreign tax credit carryforwards begin to expire in 1997.
(Continued)
<PAGE> 17
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(7) COMMITMENTS AND CONTINGENCIES
The Company leased an operating facility with a lease termination date of
February 28, 1994. The minimum rental commitments under the lease are
$40,000 in 1994. The Company exercised its option under the agreement to
purchase the facility during 1994 for approximately $500,000 in cash and
the issuance of a note payable to the seller for approximately $1.6
million. The related rental expense was $236,000 and $200,000 during 1993
and 1992, respectively.
The Company is a defendant in litigation arising in the normal course of
business. Management believes that the ultimate outcome of these matters
will not have a materially adverse effect on the consolidated financial
position of the Company.
(8) SHAREHOLDERS' AGREEMENT
Effective February 27, 1987, the Company executed a Shareholders'
Agreement which placed certain restrictions on the transferability of
substantially all of the Company's common shares. In the event an employee
shareholder, as defined in the Shareholders' Agreement, dies, retires,
becomes permanently or totally disabled, or is terminated involuntarily
without cause, such shareholder may offer all or any part of the shares
owned to the Company. The Company is obligated to purchase all of the
shares offered, at a purchase price equal to the per share book value. In
the event such a shareholder is terminated for reasons other than the
aforementioned reasons, the Company has the option to purchase all or any
part of the shares owned by such shareholder at 85% of the per share book
value.
(9) RELATED PARTY TRANSACTIONS
On January 1, 1993, the Company entered into an employment agreement (the
Agreement) with an executive (the Executive or Stockholder) of the
Company. The Agreement is in effect for seven years with automatic
one-year extensions unless the Company or the Executive terminates the
Agreement in accordance with contract provisions.
During 1992, the Company entered into an Agreement with the Stockholder to
pay the premiums on a life insurance policy for the benefit of the
Stockholder's estate. The advances made by the Company in payment of the
premiums are secured by assignment of the policy to the Company solely to
recover the amounts advanced by the Company.
(10) INCENTIVE STOCK OPTION PLAN
The Company's 1987 Incentive Stock Option Plan, as revised, provides for
the granting of qualified stock options to purchase 1,000 shares of common
stock to eligible employees.
(Continued)
<PAGE> 18
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The options are exercisable over a period determined by the Board of
Directors, but no longer than ten years after the date they are granted,
subject to the individual being an employee of the Company. However,
options granted to individuals who own 10% or more of the combined voting
power of all classes of stock of the Company have five years to exercise
the option. The option price will be determined by the Company's Board of
Directors but shall in no event be less than 100% of the fair market
value on the date of grant.
At December 31, 1993, 830 options are outstanding with exercise prices of
$1,148 and $2,545 per share for 500 and 330 of the options, respectively.
No options were exercised during 1993. The options begin to expire between
1997 and 2002.
(11) PROFIT SHARING PLAN
The Company has a noncontributory profit-sharing plan (the Plan) covering
substantially all domestic employees. The Company incurred Plan expenses
totaling $697,602 and $761,973 during 1993 and 1992, respectively. The
Company makes discretionary contributions to the Plan in amounts
determined annually by management.
(12) INSURANCE
The Company was self-insured for employee health claims up to $25,000 per
individual from January 1, 1992 through April 30, 1992 and for up to
$35,000 per individual from May 1, 1992 through December 31, 1993. Expense
for employee health benefit claims and stop loss reinsurance premiums
totaled $503,127 and $382,572 during 1993 and 1992, respectively.
At December 31, 1993, a receivable of $2,379,585, net of an allowance of
$2,790,000 related to disputed claims, was recorded related to the
Company's claims under its insurance policy. The net insurance proceeds
anticipated to be recovered are reflected as a reduction of turnkey
drilling expenses as such proceeds represent reimbursements of redrilling
and other costs incurred by the Company. Management believes the net
receivable recorded as of December 31, 1993 is collectible.
(13) CONCENTRATION OF CREDIT RISK
The Company's sales and accounts receivable relate primarily to turnkey
drilling activities. At December 31, 1993, $22,064,593 of accounts
receivable related to drilling activities in Central and South America. An
allowance of $290,000 has been recorded as of December 31, 1993 for
doubtful accounts. The net receivable balance is deemed to be collectible
by management.
(Continued)
<PAGE> 19
TRITON ENGINEERING SERVICES COMPANY
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(14) SUBSEQUENT EVENTS (UNAUDITED)
The Company has recorded an accrual for $1,466,999 ($953,549 net of tax)
related to a loss incurred on a domestic turnkey drilling contract in
progress at December 31, 1993. The Company is vigorously pursuing
recovery of the loss from a drilling company from whom it rented equipment
for the drilling of the well. The Company believes it will ultimately be
able to recover a portion of this loss.
During January 1994, the Company entered into negotiations to sell all of
the outstanding stock of Triton Engineering Services Company to Noble
Drilling Corporation. A letter of intent has been signed by both parties.
The consolidated financial statements do not include any adjustments
relating to the recoverability and classification of recorded asset
amounts or the amounts and classifications of liabilities that might
result from the sale.
<PAGE> 20
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
MARCH 31, 1994
(IN THOUSANDS)
(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 17,685
Accounts receivable, net 22,666
Other current assets 16,527
-----------
Total current assets 56,878
-----------
PROPERTY AND EQUIPMENT
Drilling equipment and facilities 4,846
Other 4,216
-----------
9,062
Accumulated depreciation (4,905)
-----------
4,157
-----------
$ 61,035
-----------
-----------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term debt $ 1,566
Accounts payable 13,355
Other current liabilities 27,804
-----------
Total current liabilities 42,725
-----------
MINORITY INTEREST 5,392
-----------
48,117
-----------
SHAREHOLDERS' EQUITY
Common stock 12
Retained earnings 17,212
Treasury stock, at cost (4,306)
-----------
12,918
-----------
$ 61,035
-----------
-----------
See notes to interim financial statements.
<PAGE> 21
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
FOR THE QUARTER ENDED MARCH 31, 1994
(IN THOUSANDS)
(UNAUDITED)
Revenues:
Turnkey drilling operations $ 22,458
Engineering services 1,536
Supply services and other 2,194
----------
26,188
Direct expenses 21,312
----------
Gross profit 4,876
Operating expenses 4,521
----------
Operating income 355
Other income (expense):
Interest income 123
Gain (loss) on sale of assets (413)
Other (1,948)
----------
Loss before income tax and minority interest (1,883)
Income tax provision (115)
Minority interest (493)
----------
Net loss $ (2,491)
----------
----------
See notes to interim financial statements.
<PAGE> 22
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED CASH FLOWS
FOR THE QUARTER ENDED MARCH 31, 1994
(IN THOUSANDS)
(UNAUDITED)
Cash flows from operating activities:
Net loss $ (2,491)
Adjustments to reconcile net loss to net cash provided by
operating activities:
Minority interest 493
Depreciation, depletion and amortization 236
(Gain) loss on sale of assets 413
(Gain) loss on foreign exchange (6)
Elimination of investment in partnership 1,545
Changes in assets and liabilities:
Decrease (increase) in:
Accounts receivable 19,832
Other assets (5,695)
Increase (decrease) in:
Accounts payable (19,954)
Other liabilities 12,805
----------
Net cash provided by operating activities 7,178
----------
Cash flows used in investing activities:
Purchase of property and equipment (2,356)
Proceeds from sale of property and equipment 68
Distribution to joint venturer (2,000)
----------
Net cash used in investing activities (4,288)
----------
Cash flows used in financing activities:
Repayment of note payable (241)
Effect of exchange rate changes on cash 6
----------
Increase (decrease) in cash and cash equivalents 2,655
Cash and cash equivalents, beginning of period 15,030
----------
Cash and cash equivalents, end of period $ 17,685
----------
----------
Interest paid $ 10
----------
----------
Income taxes paid $ 835
----------
----------
See notes to interim financial statements.
<PAGE> 23
TRITON ENGINEERING SERVICES COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE QUARTER ENDED MARCH 31, 1994
(UNAUDITED)
NOTE 1 - FINANCIAL STATEMENT BASIS
The consolidated balance sheet as of March 31, 1994, the related consolidated
statement of income for the three-month period ended March 31, 1994 and the
consolidated statement of cash flows for the three-month period ended March
31, 1994 are unaudited. In the opinion of management, all adjustments,
consisting of only normal recurring adjustments, necessary for a fair
presentation of such financial statements have been included. These interim
financial statements are presented in condensed form and should be read in
conjunction with the 1993 audited financial statements and notes.
<PAGE> 24
NOBLE DRILLING CORPORATION AND SUBSIDIARIES
PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma condensed consolidated balance sheet
at March 31, 1994 and unaudited pro forma condensed consolidated statements of
operations for the quarter ended March 31, 1994 and the year ended December 31,
1993, reflect the pro forma financial position and results of operations,
respectively, of Noble Drilling Corporation and subsidiaries ("Noble") after
giving effect to the acquisition of Triton Engineering Services Company
("Triton") pursuant to the terms of a Stock Purchase Agreement (the
"Acquisition") dated April 22, 1994, as further described in Item 2 of the
Noble's Form 8-K dated May 6, 1994. The unaudited pro forma condensed
consolidated financial statements should be read in conjunction with the
historical condensed consolidated financial statements of Noble and the
historical financial statements of Triton and the respective related notes
thereto.
The unaudited pro forma condensed consolidated statements of operations
are not necessarily indicative either of the results of operations that would
have occurred had the Acquisition been effected on January 1, 1993 or of future
results of operations.
<PAGE> 25
NOBLE DRILLING CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 1994
(IN THOUSANDS)
ASSETS
<TABLE>
<CAPTION>
HISTORICAL
------------------------ PRO FORMA
THE ACQUISITION AS
COMPANY TRITON ADJUSTMENTS ADJUSTED
------- ------ ----------- --------
<S> <C> <C> <C> <C>
CURRENT ASSETS
Cash and cash equivalents............................ $ 9,674 $ 17,685 $ (4,085)(A) $ 23,274
Restricted cash...................................... 1,789 1,789
Investment in marketable securities.................. 34,873 34,873
Accounts receivable, net............................. 41,748 22,666 64,414
Other current assets................................. 37,937 16,527 54,464
----------- ---------- ---------- -----------
Total current assets.............................. 126,021 56,878 (4,085) 178,814
----------- ---------- ---------- -----------
PROPERTY AND EQUIPMENT
Drilling equipment and facilities.................... 621,689 4,846 (3,403)(B) 623,132
Other................................................ 13,995 4,216 (1,502)(B) 16,709
----------- ---------- ---------- -----------
635,684 9,062 (4,905) 639,841
Accumulated depreciation............................. (268,311) (4,905) 4,905 (B) (268,311)
----------- ---------- ---------- -----------
367,373 4,157 0 371,530
OTHER ASSETS............................................ 13,483 336 (C) 13,819
----------- ---------- ---------- -----------
$ 506,877 $ 61,035 $ (3,749) $ 564,163
----------- ---------- ---------- -----------
----------- ---------- ---------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term debt...................................... $ 1,566 $ 4,000 (A) $ 5,566
Current installment of long-term debt................ $ 546 546
Accounts payable..................................... 7,569 13,355 20,924
Interest payable..................................... 5,612 5,612
Other current liabilities............................ 33,305 27,804 61,109
----------- ---------- ---------- -----------
Total current liabilities......................... 47,032 42,725 4,000 93,757
----------- ---------- ---------- -----------
LONG-TERM DEBT.......................................... 127,138 127,138
OTHER LIABILITIES....................................... 1,108 1,108
MINORITY INTEREST....................................... 119 5,392 5,511
----------- ---------- ---------- -----------
175,397 48,117 4,000 227,514
----------- ---------- ---------- -----------
SHAREHOLDERS' EQUITY
Preferred stock...................................... 2,990 2,990
Common stock......................................... 4,784 12 (12)(D) 4,859
75 (A)
Capital stock in excess of par value................. 333,710 5,094 (A) 338,804
Cumulative translation adjustment.................... (2,641) (2,641)
Retained earnings (deficit).......................... (5,613) 17,212 (17,212)(D) (5,613)
Treasury stock, at cost.............................. (1,750) (4,306) 4,306 (D) (1,750)
----------- ---------- ---------- -----------
331,480 12,918 (7,749) 336,649
----------- ---------- ---------- -----------
$ 506,877 $ 61,035 $ (3,749) $ 564,163
----------- ---------- ---------- -----------
----------- ---------- ---------- -----------
</TABLE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(A) To record the purchase by Noble Drilling Corporation ("Noble") of all of
the outstanding shares of common stock of Triton Engineering Services
Company ("Triton").
(B) To record the effect of Noble accounting for the fixed assets of Triton at
fair market value.
(C) To record goodwill of $336,000, which represents the excess of the purchase
price over net assets acquired.
(D) To eliminate Triton's equity pursuant to the Stock Purchase Agreement dated
April 22, 1994 (the "Acquisition").
<PAGE> 26
NOBLE DRILLING CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE QUARTER ENDED MARCH 31, 1994
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
HISTORICAL
------------------------ PRO FORMA
THE ACQUISITION AS
COMPANY TRITON ADJUSTMENTS ADJUSTED
------- ------ ----------- --------
<S> <C> <C> <C> <C>
REVENUES
Contract drilling services........................ $ 57,865 $ 57,865
Turnkey drilling services......................... $ 22,458 22,458
Engineering and consulting services............... 309 1,536 1,845
Other revenue..................................... 1,074 2,194 $ (53)(A) 3,215
---------- ---------- ----------- -----------
59,248 26,188 (53) 85,383
OPERATING COSTS AND EXPENSES
Contract drilling services........................ 38,001 38,001
Turnkey drilling services......................... 18,989 18,989
Engineering and consulting services............... 258 756 1,014
Other expense..................................... 601 1,376 (2)(A) 1,975
Selling, general and administrative............... 6,324 4,476 (1,070)(B) 9,730
Depreciation and amortization..................... 7,161 236 9 (C) 7,406
Minority interest................................. (37) 493 456
---------- ---------- ----------- -----------
52,308 26,326 (1,063) 77,571
---------- ---------- ----------- -----------
OPERATING INCOME (LOSS).............................. 6,940 (138) 1,010 7,812
OTHER INCOME (EXPENSE)
Interest expense.................................. (3,000) (3,000)
Interest income................................... 587 123 710
Other, net........................................ 1,143 (2,361) 51 (A) 1,053
2,220 (D)
---------- ---------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES.................... 5,670 (2,376) 3,281 6,575
INCOME TAX PROVISION................................. (1,203) (115) (696)(E) (2,014)
---------- ---------- ----------- -----------
NET INCOME (LOSS).................................... 4,467 (2,491) 2,585 4,561
PREFERRED STOCK DIVIDENDS............................ (1,682) (1,682)
---------- ---------- ----------- -----------
NET INCOME (LOSS) APPLICABLE TO COMMON
SHARES............................................ $ 2,785 $ (2,491) $ 2,585 $ 2,879
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
NET INCOME PER COMMON SHARE.......................... $ 0.06 $ 0.06
---------- -----------
---------- -----------
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING....................................... 48,355 752 49,107
</TABLE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(A) To reclassify the operating results of Triton's oil and gas activities, as
these activities are not an ongoing business line of Noble.
(B) To eliminate a nonrecurring stock option buyout effected by Triton in March
1994 in connection with the Acquisition.
(C) To record amortization of $9,000 for goodwill associated with the
Acquisition.
(D) To eliminate the write-off of $2,220,000 of notes receivable from a
partnership that was not part of the Acquisition.
(E) To record the incremental tax effect of the Acquisition adjustments.
<PAGE> 27
NOBLE DRILLING CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1993
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
HISTORICAL
------------------------ PRO FORMA
THE ACQUISITION AS
COMPANY TRITON ADJUSTMENTS ADJUSTED
------- ------ ----------- --------
<S> <C> <C> <C> <C>
REVENUES
Contract drilling services........................ $ 188,206 $ 188,206
Turnkey drilling services......................... $ 110,003 110,003
Engineering and consulting services............... 2,292 7,812 10,104
Other revenue..................................... 4,444 6,019 $ (362)(A) 10,101
--------- --------- --------- ----------
194,942 123,834 (362) 318,414
OPERATING COSTS AND EXPENSES
Contract drilling services........................ 123,817 123,817
Turnkey drilling services......................... 89,456 89,456
Engineering and consulting services............... 2,083 3,518 5,601
Other expense..................................... 2,736 9,195 (59)(A) 11,872
Selling, general and administrative............... 22,405 12,163 34,568
Depreciation and amortization..................... 20,472 1,170 34 (B) 21,676
Minority interest................................. (232) 4,767 4,535
--------- --------- --------- ----------
171,281 120,269 (25) 291,525
--------- --------- --------- ----------
OPERATING INCOME..................................... 23,661 3,565 (337) 26,889
OTHER INCOME (EXPENSE)
Interest expense.................................. (5,406) (336) (5,742)
Interest income................................... 1,628 293 1,921
Other, net........................................ 1,737 206 303 (A) 2,340
94 (C)
--------- --------- --------- ----------
INCOME BEFORE INCOME TAXES........................... 21,620 3,728 60 25,408
INCOME TAX PROVISION................................. (2,474) (2,222) (7)(D) (4,703)
--------- --------- --------- ----------
INCOME FROM CONTINUING OPERATIONS.................... 19,146 1,506 53 20,705
PREFERRED STOCK DIVIDENDS............................ (6,728) (6,728)
--------- --------- --------- ----------
INCOME FROM CONTINUING OPERATIONS
APPLICABLE TO COMMON SHARES....................... $ 12,418 $ 1,506 $ 53 $ 13,977
--------- --------- --------- ----------
--------- --------- --------- ----------
INCOME FROM CONTINUING OPERATIONS PER
COMMON SHARE...................................... $ 0.32 $ 0.36
--------- ----------
--------- ----------
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING....................................... 38,366 752 39,118
</TABLE>
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(A) To reclassify the operating results of Triton's oil and gas activities, as
these activities are not an ongoing business line of Noble.
(B) To record amortization of $34,000 for goodwill associated with the
Acquisition.
(C) To eliminate the net loss of $94,000 from an unconsolidated partnership
that was not part of the Acquisition.
(D) To record the incremental tax effect of the Acquisition adjustments.
<PAGE> 28
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: June 30, 1994 NOBLE DRILLING CORPORATION
By: /s/ Byron L. Welliver
Byron L. Welliver, Senior Vice
President-Finance and Treasurer
