<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [NO FEE REQUIRED, EFFECTIVE OCTOBER 7, 1996]
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ___________________to_________________
Commission file number 1-13926
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
DIAMOND OFFSHORE DEFINED CONTRIBUTION RETIREMENT PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
DIAMOND OFFSHORE DRILLING, INC.
15415 KATY FREEWAY
HOUSTON, TEXAS 77094
<PAGE> 2
REQUIRED INFORMATION
Item 4.
The financial statements and schedules of the Diamond
Offshore Defined Contribution Retirement Plan for the fiscal year ended
December 31, 1998 (attached)
Exhibits
23.1 Consent of Deloitte & Touche LLP
<PAGE> 3
AUDITED FINANCIAL STATEMENTS AND SCHEDULES
DIAMOND OFFSHORE DEFINED CONTRIBUTION RETIREMENT PLAN
Years ended December 31, 1998 and 1997 and
Supplemental Schedules for Year ended December 31, 1998
with Report of Independent Auditors
<PAGE> 4
DIAMOND OFFSHORE DEFINED CONTRIBUTION RETIREMENT PLAN
Audited Financial Statements and Schedules
Years ended December 31, 1998 and 1997
CONTENTS
<TABLE>
<S> <C>
Report of Independent Auditors................................................................... 1
Financial Statements
Statements of Net Assets Available for Plan Benefits, December 31, 1998 and 1997................. 2
Statements of Changes in Net Assets Available for Plan Benefits for the Years ended
December 31, 1998, 1997 and 1996....................................................... 3
Notes to Financial Statements.................................................................... 4
ERISA Supplemental Schedules
Item 27a--Schedule of Assets Held for Investment Purposes........................................ 13
Item 27d--Schedule of Reportable Transactions.................................................... 14
</TABLE>
<PAGE> 5
INDEPENDENT AUDITORS' REPORT
TO THE PARTICIPANTS AND ADMINISTRATIVE COMMITTEE
OF THE DIAMOND OFFSHORE DEFINED CONTRIBUTION
RETIREMENT PLAN
HOUSTON, TEXAS
We have audited the accompanying statements of net assets available for
benefits of the Diamond Offshore Defined Contribution Retirement Plan (the
"Plan") as of December 31, 1998 and 1997, and the related statements of changes
in net assets available for benefits for each of the three years in the period
ended December 31, 1998. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for each of
the three years in the period ended December 31, 1998 in conformity with
generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of (1) assets
held for investment purposes as of December 31, 1998, and (2) reportable
transactions for the year ended December 31, 1998 are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employment
Retirement Income Security Act of 1974. These schedules are the responsibility
of the Plan's management. Such schedules have been subjected to the auditing
procedures applied in our audit of the basic 1998 financial statements and, in
our opinion, are fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
DELOITTE & TOUCHE LLP
June 16, 1999
1
<PAGE> 6
DIAMOND OFFSHORE DEFINED CONTRIBUTION
RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------
1998 1997
--------------- ---------------
<S> <C> <C>
INVESTMENTS AT FAIR VALUE:
Mutual funds ............................... $ 62,859,786 $ 47,380,647
Company stock .............................. 1,419,733 1,713,155
--------------- ---------------
Total investments ................ 64,279,519 49,093,802
CONTRIBUTIONS RECEIVABLE:
Employee ................................... 768,666 589,847
Employer ................................... 1,640,115 1,267,153
--------------- ---------------
Total contributions receivable ... 2,408,781 1,857,000
LOANS TO PARTICIPANTS ............................ 2,882,871 2,022,640
OTHER ASSETS ..................................... 2,942 6,302
--------------- ---------------
NET ASSETS AVAILABLE FOR BENEFITS ................ $ 69,574,113 $ 52,979,744
=============== ===============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
2
<PAGE> 7
DIAMOND OFFSHORE DEFINED CONTRIBUTION
RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends and interest ........................... $ 3,740,948 $ 2,938,430 $ 1,944,678
Net appreciation in fair value of investments .... 2,124,346 3,659,059 736,638
--------------- --------------- ---------------
Total investment income .................... 5,865,294 6,597,489 2,681,316
CONTRIBUTIONS:
Employee ......................................... 8,389,378 4,680,340 3,733,432
Employer ......................................... 5,786,246 6,477,438 2,524,009
Rollover ......................................... 334,664 11,231,765 --
--------------- --------------- ---------------
Total contributions ........................ 14,510,288 22,389,543 6,257,441
--------------- --------------- ---------------
Total additions ............................ 20,375,582 28,987,032 8,938,757
--------------- --------------- ---------------
DEDUCTIONS:
Benefit payments ................................. (3,631,644) (4,362,444) (2,018,926)
Miscellaneous expenditures ....................... (149,569) (16,541) --
--------------- --------------- ---------------
Total deductions ........................... (3,781,213) (4,378,985) (2,018,926)
--------------- --------------- ---------------
NET INCREASE IN NET ASSETS AVAILABLE
FOR BENEFITS ..................................... 16,594,369 24,608,047 6,919,831
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of period .............................. 52,979,744 28,371,697 21,451,866
--------------- --------------- ---------------
End of period .................................... $ 69,574,113 $ 52,979,744 $ 28,371,697
=============== =============== ===============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE> 8
DIAMOND OFFSHORE CONTRIBUTION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998 AND 1997
1. ORGANIZATION
The Diamond Offshore Defined Contribution Retirement Plan (the "Plan") was
established effective July 1, 1989. Effective January 1, 1997, Diamond Offshore
Drilling, Inc. (the "Company") merged the Arethusa Off-Shore Company Profit
Sharing Plan (the "Arethusa Plan") with and into the Plan. Net assets available
for benefits for the Arethusa Plan were $10,731,913 as of December 31, 1996. In
connection with this merger, the Plan changed trustees from The Dreyfus Trust
Company ("Dreyfus") to The Scudder Trust Company ("Scudder") effective January
1, 1997. The adoption of the Plan in its entirety is intended to comply with
the provisions of Sections 401(a), 401(k) and 401(m) of the Internal Revenue
Code (the "IRC") and applicable regulations thereunder. The Plan is intended to
qualify as a profit-sharing plan in accordance with the requirement of Section
401(a)(27) of the IRC.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING BASIS - The financial statements of the Plan are prepared
using the accrual basis of accounting.
INVESTMENTS - Investments are reported in the financial statements at
fair value.
TRUSTEE FEES - Normal recurring trustee fees are paid by the Company, the
Plan's sponsor. Fees paid by the Company were $49,314 and $10,112 for the years
ended December 31, 1998 and 1997, respectively.
USE OF ESTIMATES - The preparation of financial statements in conformity
with generally accepted accounting principles requires Plan management to make
estimates and assumptions that affect the reported amounts of net assets
available for benefits and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of the Plan
income and expenses during the reporting period. Actual results could differ
from these estimates.
3. DESCRIPTION OF PLAN
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a complete description of
the Plan's provisions.
GENERAL - The Plan is a defined contribution retirement plan for
U.S.-paid employees of the Company and its subsidiaries. The Plan is subject to
the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA")
and the IRC.
ADMINISTRATION - The Plan is administered by an administrative committee
appointed by the President of the Company.
PARTICIPANTS - Prior to July 1, 1997, any employee of the Company became
a participant of the Plan on the first quarterly entry date (January 1, April
1, July 1, or October 1) following the completion of one year of service.
Effective July 1, 1997 an employee of the company will become a participant of
the Plan beginning in the month following the completion of a 90-day service
period.
CONTRIBUTIONS - The Company makes a profit sharing contribution equal to
3.75% of the employee's qualified yearly earnings and a matching contribution
equal to 25% for every percent the employee contributes up to a maximum of 6%.
In 1998 and 1997, Company contributions were made quarterly. In addition, each
participant may make voluntary contributions of up to 15% of his or her annual
compensation, as defined by the Plan. Employee contributions are made through
payroll deductions.
4
<PAGE> 9
INVESTMENT FUNDS - Effective January 1, 1997, the following investment
options are available to plan participants:
Scudder Stable Value Funds: This collective investment trust invests
in high-quality instruments, including guaranteed investment
contracts, bank investment contracts, money market instruments and
synthetic contracts.
Scudder Income Fund: This fund invests primarily in high-grade
corporate bonds, convertible bonds and government securities.
Scudder Balanced Fund: This fund invests in common stocks of companies
that the fund's advisor believes offer the potential for above-average
growth of earnings, cash flow or assets relative to the overall
market.
Scudder Growth & Income Fund: This fund's primary investments are
income-producing common and preferred stocks of established companies.
Scudder Stock Index Fund: This collective investment trust invests in
common stocks of companies listed in the Standard & Poor's 500-stock
index (the "S&P 500"). The trust may invest in all 500 stocks or in
other mutual funds that approximately mirror the S&P 500 in their
weightings.
MFS Research Fund A: This fund invests in common stocks or securities
convertible into common stocks of companies believed to possess
better-than-average prospects for long-term growth.
Templeton Foreign Fund I: This fund generally invests in common stock,
although it may also invest in preferred stocks and certain debt
securities, rated or unrated.
Putnam New Opportunities Fund A: This fund invests primarily in common
stocks in the following sectors: personal communications,
environmental services, media/entertainment, medical
technology/medical cost containment, applied advanced technology,
value-oriented consuming and personal finance.
Diamond Offshore Drilling, Inc. Common Stock: This fund invests in the
common stock of the Company and reinvests dividends of the Company's
stock, if any, into additional shares of the Company.
PARTICIPANT ACCOUNTS - Each participant's account is credited with the
Company's and the participant's contributions and an allocation of the Plan's
earnings. Allocations are based primarily on account balances at specified
dates as provided under the terms of the Plan.
VESTING - Each participant has at all times a fully vested and
nonforfeitable interest in their contributions and earnings thereon. Matching
contributions made by the Company to participant accounts vest 100% after five
years of service.
FORFEITURES - Forfeitures are applied to reduce the Company contributions
to the Plan.
LOANS - Participants may borrow from his or her account up to the lessor
of (i) one-half of the vested value of their accounts or (ii) $50,000.
PAYMENT OF BENEFITS - Upon separation of service, each participant may
elect to receive the entire account balance in a lump sum payment. As of
December 31, 1998 and 1997, amounts payable to participants who had terminated
or withdrawn from the Plan were $86,255 and $624,336, respectively.
5
<PAGE> 10
4. PLAN TERMINATION
Although the Company has not expressed any intent to do so, it has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. Upon termination of the
Plan by the Company, the trustee will distribute to each participant the
amounts credited to his or her account. No amount will revert to the Company in
the event of the Plan's termination.
5. FEDERAL INCOME TAXES
The Plan has obtained a favorable tax determination letter from the
Internal Revenue Service ("IRS") dated February 25, 1997. It is the opinion of
the Plan administrative committee that the Plan has met, and continues to meet,
all necessary IRS requirements exempting it from federal income taxes;
therefore, no provision for income taxes has been made.
6
<PAGE> 11
6. STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS - BY FUND
<TABLE>
<CAPTION>
SCUDDER SCUDDER SCUDDER SCUDDER SCUDDER MFS TEMPLETON
STABLE VALUE INCOME BALANCED GROWTH & STOCK INDEX RESEARCH FOREIGN
DECEMBER 31, 1998 FUND FUND FUND INCOME FUND FUND FUND A FUND I
------------ ----------- ----------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investments:
Mutual funds.............. $19,449,996 $ 1,352,373 $ 526,586 $13,087,689 $ 1,470,570 $10,911,667 $ 2,668,727
Company stock ............ -- -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total investments......... 19,449,996 1,352,373 526,586 13,087,689 1,470,570 10,911,667 2,668,727
----------- ----------- ----------- ----------- ----------- ----------- -----------
Contributions receivable:
Employee ................. 191,667 15,257 16,200 164,264 33,375 114,356 36,168
Employer ................. 630,845 28,527 26,505 296,083 52,246 198,378 67,208
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total contributions
receivable ............... 822,512 43,784 42,705 460,347 85,621 312,734 103,376
----------- ----------- ----------- ----------- ----------- ----------- -----------
Other assets ................ -- -- -- -- -- -- --
Loans to participants ....... -- -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net assets available for
benefits .................... $20,272,508 $ 1,396,157 $ 569,291 $13,548,036 $ 1,556,191 $11,224,401 $ 2,772,103
=========== =========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
PUTNAM DIAMOND
NEW OFFSHORE
OPPORTUNITIES DRILLING, INC. CASH LOAN TRANSACTIONS
DECEMBER 31, 1998 FUND A COMMON STOCK FUND FUND PENDING TOTAL
------------- ------------- ----------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Investments:
Mutual funds ................. $13,392,178 -- -- -- -- $62,859,786
Company stock ................ -- $ 1,419,733 -- -- -- 1,419,733
----------- ----------- ----------- ----------- ----------- -----------
Total investments ............ 13,392,178 1,419,733 -- -- -- 64,279,519
----------- ----------- ----------- ----------- ----------- -----------
Contributions receivable:
Employee ..................... 163,429 33,950 -- -- -- 768,666
Employer ..................... 283,298 57,025 -- -- -- 1,640,115
----------- ----------- ----------- ----------- ----------- -----------
Total contributions
receivable ................... 446,727 90,975 -- -- -- 2,408,781
----------- ----------- ----------- ----------- ----------- -----------
Other assets .................... -- -- -- -- $ 2,942 2,942
Loans to participants ........... -- -- -- $ 2,882,871 -- 2,882,871
----------- ----------- ----------- ----------- ----------- -----------
Net assets available for
benefits ........................ $13,838,905 $ 1,510,708 $ -- $ 2,882,871 $ 2,942 $69,574,113
=========== =========== =========== =========== =========== ===========
</TABLE>
7
<PAGE> 12
<TABLE>
<CAPTION>
SCUDDER SCUDDER SCUDDER SCUDDER SCUDDER MFS TEMPLETON
STABLE VALUE INCOME BALANCED GROWTH & STOCK INDEX RESEARCH FOREIGN
DECEMBER 31, 1997 FUND FUND FUND INCOME FUND FUND FUND A FUND I
------------ ----------- ----------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investments:
Mutual funds .............. $15,152,285 $ 1,089,500 $ 161,987 $10,859,687 $ 412,600 $ 8,072,838 $ 2,560,440
Company stock ............. -- -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total investments ......... 15,152,285 1,089,500 161,987 10,859,687 412,600 8,072,838 2,560,440
----------- ----------- ----------- ----------- ----------- ----------- -----------
Contributions receivable:
Employee .................. 146,690 11,204 6,435 131,304 15,397 95,662 34,487
Employer .................. 498,888 20,563 10,312 225,929 23,820 167,618 59,752
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total contributions
receivable ................ 645,578 31,767 16,747 357,233 39,217 263,280 94,239
----------- ----------- ----------- ----------- ----------- ----------- -----------
Other assets ................. -- -- -- -- -- -- --
Loans to participants ........ -- -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net assets available for
benefits ..................... $15,797,863 $ 1,121,267 $ 178,734 $11,216,920 $ 451,817 $ 8,336,118 $ 2,654,679
=========== =========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
PUTNAM DIAMOND
NEW OFFSHORE
OPPORTUNITIES DRILLING, INC. CASH LOAN TRANSACTIONS
DECEMBER 31, 1997 FUND A COMMON STOCK FUND FUND PENDING TOTAL
------------- ------------- ----------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Investments:
Mutual funds ............ $ 9,071,310 -- -- -- -- $47,380,647
Company stock ........... -- $ 1,713,155 -- -- -- 1,713,155
----------- ----------- ----------- ----------- ----------- -----------
Total investments ....... 9,071,310 1,713,155 -- -- -- 49,093,802
----------- ----------- ----------- ----------- ----------- -----------
Contributions receivable:
Employee ................ 124,243 -- -- -- $ 24,425 589,847
Employer ................ 224,480 -- -- -- 35,791 1,267,153
----------- ----------- ----------- ----------- ----------- -----------
Total contributions
receivable .............. 348,723 -- -- -- 60,216 1,857,000
----------- ----------- ----------- ----------- ----------- -----------
Other assets ............... -- -- $ 1,981 -- 4,321 6,302
Loans to participants ...... -- -- -- $ 2,022,640 -- 2,022,640
----------- ----------- ----------- ----------- ----------- -----------
Net assets available for
benefits ................... $ 9,420,033 $ 1,713,155 $ 1,981 $ 2,022,640 $ 64,537 $52,979,744
=========== =========== =========== =========== =========== ===========
</TABLE>
8
<PAGE> 13
7. STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS - BY FUND
<TABLE>
<CAPTION>
SCUDDER SCUDDER SCUDDER SCUDDER SCUDDER MFS TEMPLETON
FOR THE YEAR ENDED STABLE VALUE INCOME BALANCED GROWTH & STOCK INDEX RESEARCH FOREIGN
DECEMBER 31, 1998 FUND FUND FUND INCOME FUND FUND FUND A FUND I
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ..... $ 1,128,150 $ 100,513 $ 31,404 $ 1,261,612 $ 4,093 $ 428,477 $ 296,420
Net appreciation
(depreciation) in fair
value of investments ....... -- (25,653) 37,100 (513,614) 233,010 1,604,618 (398,496)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total investment
income ................ 1,128,150 74,860 68,504 747,998 237,103 2,033,095 (102,076)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee ................... 2,019,063 152,441 131,161 1,829,498 322,562 1,300,959 446,513
Employer ................... 2,190,942 96,776 71,912 1,050,923 168,469 731,704 255,288
Rollover ................... 1,025,346 118,007 139,790 (483,906) 388,984 (452,154) (298,164)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total contributions .... 5,235,351 367,224 342,863 2,396,515 880,015 1,580,509 403,637
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total additions ........ 6,363,501 442,084 411,367 3,144,513 1,117,118 3,613,604 301,561
------------ ------------ ------------ ------------ ------------ ------------ ------------
Deductions:
Benefit payments ........... (1,632,932) (133,312) (8,287) (568,713) (14,033) (557,423) (165,510)
Miscellaneous expenditures . (255,924) (33,882) (12,523) (244,684) 1,289 (167,898) (18,627)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total deductions ....... (1,888,856) (167,194) (20,810) (813,397) (12,744) (725,321) (184,137)
Net increase (decrease) in
net assets available for
benefits ................... 4,474,645 274,890 390,557 2,331,116 1,104,374 2,888,283 117,424
Net assets available for
benefits:
Beginning of period ........ 15,797,863 1,121,267 178,734 11,216,920 451,817 8,336,118 2,654,679
------------ ------------ ------------ ------------ ------------ ------------ ------------
End of period .............. $ 20,272,508 $ 1,396,157 $ 569,291 $ 13,548,036 $ 1,556,191 $ 11,224,401 $ 2,772,103
============ ============ ============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
PUTNAM DIAMOND
NEW OFFSHORE
FOR THE YEAR ENDED OPPORTUNITIES DRILLING, INC. CASH LOAN TRANSACTION
DECEMBER 31, 1998 FUND A COMMON STOCK FUND FUND PENDING TOTAL
------------- ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ....... $ 462,637 $ 27,043 $ 216 -- $ 383 $ 3,740,948
Net appreciation
(depreciation) in fair
value of investments ......... 2,167,821 (980,440) -- -- -- 2,124,346
------------ ------------ ------------ ------------ ------------ ------------
Total investment income .. 2,630,458 (953,397) 216 -- 383 5,865,294
------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee ..................... 1,820,008 367,171 -- -- 2 8,389,378
Employer ..................... 1,026,857 193,373 -- -- 2 5,786,246
Rollover ..................... (353,101) 194,353 5,546 -- 49,963 334,664
------------ ------------ ------------ ------------ ------------ ------------
Total contributions ...... 2,493,764 754,897 5,546 -- 49,967 14,510,288
------------ ------------ ------------ ------------ ------------ ------------
Total additions .......... 5,124,222 (198,500) 5,762 -- 50,350 20,375,582
------------ ------------ ------------ ------------ ------------ ------------
Deductions:
Benefit payments ............. (472,899) (21,126) -- $ (4,000) (53,409) (3,631,644)
Miscellaneous expenditures ... (232,451) 17,179 (7,743) 864,231 (58,536) (149,569)
------------ ------------ ------------ ------------ ------------ ------------
Total deductions ......... (705,350) (3,947) (7,743) 860,231 (111,945) (3,781,213)
Net increase (decrease) in
net assets available for
benefits ..................... 4,418,872 (202,447) (1,981) 860,231 (61,595) 16,594,369
Net assets available for
benefits:
Beginning of period .......... 9,420,033 1,713,155 1,981 2,022,640 64,537 52,979,744
------------ ------------ ------------ ------------ ------------ ------------
End of period ................ $ 13,838,905 $ 1,510,708 $ -- $ 2,882,871 $ 2,942 $ 69,574,113
============ ============ ============ ============ ============ ============
</TABLE>
9
<PAGE> 14
<TABLE>
<CAPTION>
SCUDDER SCUDDER SCUDDER SCUDDER SCUDDER MFS TEMPLETON
FOR THE YEAR ENDED STABLE VALUE INCOME BALANCED GROWTH & STOCK INDEX RESEARCH FOREIGN
DECEMBER 31, 1997 FUND FUND FUND INCOME FUND FUND FUND A FUND I
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ...... $ 934,551 $ 62,559 $ 8,732 $ 1,052,153 $ 1,446 $ 366,326 $ 282,992
Net appreciation
(depreciation) in fair
value of investments ........ -- 25,240 7,257 1,326,941 39,651 934,599 (119,636)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total investment income ... 934,551 87,799 15,989 2,379,094 41,097 1,300,925 163,356
------------ ------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee .................... 1,253,982 111,050 32,638 1,032,458 85,895 776,853 278,040
Employer .................... 2,617,625 101,076 29,898 1,090,014 72,358 988,269 323,704
Rollover .................... 2,157,282 1,045,372 -- 2,456,201 -- 2,383,960 --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total contributions ....... 6,028,889 1,257,498 62,536 4,578,673 158,253 4,149,082 601,744
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total additions ........... 6,963,440 1,345,297 78,525 6,957,767 199,350 5,450,007 765,100
------------ ------------ ------------ ------------ ------------ ------------ ------------
Deductions:
Benefit payments ............ (1,781,636) (249,828) (745) (777,078) (10,828) (559,679) (198,120)
Miscellaneous expenditures .. -- -- -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total deductions .......... (1,781,636) (249,828) (745) (777,078) (10,828) (559,679) (198,120)
Interfund transfers ............ 10,616,059 25,798 100,954 5,036,231 263,295 3,445,790 2,087,699
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in
net assets available for
benefits .................... 15,797,863 1,121,267 178,734 11,216,920 451,817 8,336,118 2,654,679
Net assets available for
benefits:
Beginning of period ......... -- -- -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------ ------------
End of period ............... $ 15,797,863 $ 1,121,267 $ 178,734 $ 11,216,920 $ 451,817 $ 8,336,118 $ 2,654,679
============ ============ ============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
PUTNAM DIAMOND
NEW ZAPATA OFFSHORE CAPITAL
FOR THE YEAR ENDED OPPORTUNITIES COMMON DRILLING, INC. CASH LOAN TRANSACTION PRESERVATION
DECEMBER 31, 1997 FUND A STOCK COMMON FUND FUND PENDING FUND
STOCK
------------- ------------ ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ....... $ 224,197 -- $ 3,542 $ 209 -- $ 1,723 --
Net appreciation
(depreciation) in fair
value of investments ......... 1,315,837 $ (212,580) 341,750 -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total investment
income ................... 1,540,034 (212,580) 345,292 209 -- 1,723 --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee ..................... 1,011,275 -- -- -- -- 98,149 --
Employer ..................... 1,108,551 -- 213 -- -- 145,730 --
Rollover ..................... 2,383,960 283,584 104,509 -- $ 416,897 -- --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total contributions ...... 4,503,786 283,584 104,722 -- 416,897 243,879 --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total additions .......... 6,043,820 71,004 450,014 209 416,897 245,602 --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Deductions:
Benefit payments ............. (586,872) (8,655) (188,697) -- -- (306) --
Miscellaneous expenditures ... -- -- (58) -- (16,483) -- --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total deductions ......... (586,872) (8,655) (188,755) -- (16,483) (306) --
Interfund transfers ............. 3,963,085 (62,349) 1,451,896 1,772 1,622,226 (180,759) $(10,207,262)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in
net assets available for
benefits ..................... 9,420,033 -- 1,713,155 1,981 2,022,640 64,537 (10,207,262)
Net assets available for
benefits:
Beginning of period .......... -- -- -- -- -- -- 10,207,262
------------ ------------ ------------ ------------ ------------ ------------ ------------
End of period ................ $ 9,420,033 $ -- $ 1,713,155 $ 1,981 $ 2,022,640 $ 64,537 $ --
============ ============ ============ ============ ============ ============ ============
</TABLE>
10
<PAGE> 15
<TABLE>
<CAPTION>
DREYFUS DREYFUS PREMIER
GENERAL GROWTH AND DREYFUS DREYFUS GLOBAL
FOR THE YEAR ENDED MONEY INCOME NEW APPRECIATION INVESTING
DECEMBER 31, 1997 MARKET FUND LEADERS FUNDS FUND TOTAL
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ..... -- -- -- -- -- $ 2,938,430
Net appreciation
(depreciation) in fair
value of investments ....... -- -- -- -- -- 3,659,059
------------ ------------ ------------ ------------ ------------ ------------
Total investment
income ................. -- -- -- -- -- 6,597,489
------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee ................... -- -- -- -- -- 4,680,340
Employer ................... -- -- -- -- -- 6,477,438
Rollover ................... -- -- -- -- -- 11,231,765
------------ ------------ ------------ ------------ ------------ ------------
Total contributions .... -- -- -- -- -- 22,389,543
------------ ------------ ------------ ------------ ------------ ------------
Total additions ........ -- -- -- -- -- 28,987,032
------------ ------------ ------------ ------------ ------------ ------------
Deductions:
Benefit payments ........... -- -- -- -- -- (4,362,444)
Miscellaneous
expenditures ............... -- -- -- -- -- (16,541)
------------ ------------ ------------ ------------ ------------ ------------
Total deductions ....... -- -- -- -- -- (4,378,985)
Interfund transfers ........... $ (2,575,206) $ (5,018,569) $ (4,220,923) $ (4,049,081) $ (2,300,656) --
------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in
net assets available for
benefits ................... (2,575,206) (5,018,569) (4,220,923) (4,049,081) (2,300,656) 24,608,047
Net assets available for
benefits:
Beginning of period ........ 2,575,206 5,018,569 4,220,923 4,049,081 2,300,656 28,371,697
------------ ------------ ------------ ------------ ------------ ------------
End of period .............. $ -- $ -- $ -- $ -- $ -- $ 52,979,744
============ ============ ============ ============ ============ ============
</TABLE>
11
<PAGE> 16
<TABLE>
<CAPTION>
DREYFUS DREYFUS PREMIER
CAPITAL GENERAL GROWTH DREYFUS DREYFUS GLOBAL
FOR THE YEAR ENDED PRESERVATION MONEY AND INCOME NEW APPRECIATION INVESTING
DECEMBER 31, 1996 FUND MARKET FUND LEADERS FUND FUND TOTAL
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and interest ..... $ 531,875 $ 98,530 $ 689,207 $ 281,723 $ 37,717 $ 305,626 $ 1,944,678
Net appreciation
(depreciation) in fair
value of investments ....... -- -- (77,148) 215,237 663,996 (65,447) 736,638
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total investment
income ................. 531,875 98,530 612,059 496,960 701,713 240,179 2,681,316
------------ ------------ ------------ ------------ ------------ ------------ ------------
Contributions:
Employee ................... 1,160,241 387,889 741,433 629,436 495,960 318,473 3,733,432
Employer ................... 1,074,004 233,253 408,395 343,692 286,054 178,611 2,524,009
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total contributions .... 2,234,245 621,142 1,149,828 973,128 782,014 497,084 6,257,441
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total additions ........ 2,766,120 719,672 1,761,887 1,470,088 1,483,727 737,263 8,938,757
------------ ------------ ------------ ------------ ------------ ------------ ------------
Benefit payments .............. (936,234) (176,449) (314,812) (165,752) (275,742) (149,937) (2,018,926)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Interfund transfers ........... (555,151) 201,765 (408,983) 571,025 454,913 (263,569) --
------------ ------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in
net assets available for
benefits ................... 1,274,735 744,988 1,038,092 1,875,361 1,662,898 323,757 6,919,831
Net assets available for
benefits:
Beginning of period ........ 8,932,527 1,830,218 3,980,477 2,345,562 2,386,183 1,976,899 21,451,866
------------ ------------ ------------ ------------ ------------ ------------ ------------
End of period .............. $ 10,207,262 $ 2,575,206 $ 5,018,569 $ 4,220,923 $ 4,049,081 $ 2,300,656 $ 28,371,697
============ ============ ============ ============ ============ ============ ============
</TABLE>
12
<PAGE> 17
DIAMOND OFFSHORE CONTRIBUTION RETIREMENT PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR
INVESTMENT PURPOSES
December 31, 1998
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
OR NUMBER OF
IDENTITY OF ISSUE DESCRIPTION UNITS OR SHARES COST CURRENT VALUE
<S> <C> <C> <C> <C>
Scudder Stable Value Fund Mutual Fund 19,449,995.560 $ 19,449,996 $ 19,449,996
Scudder Income Fund Mutual Fund 102,143.005 1,365,719 1,352,373
Scudder Balanced Fund Mutual Fund 27,773.509 491,378 526,586
Scudder Growth and Income Fund Mutual Fund 497,441.624 12,725,892 13,087,689
Scudder Stock Index Fund Mutual Fund 43,341.275 1,236,941 1,470,570
MFS Research Fund A Mutual Fund 433,863.481 8,835,278 10,911,667
Templeton Foreign Fund I Mutual Fund 318,084.300 3,190,499 2,668,727
Putnam New Opportunities Fund A Mutual Fund 229,200.379 10,401,984 13,392,178
Diamond Offshore Drilling, Inc. Common Stock 59,935.970 1,419,733
2,160,273
Participant Loans Loans to participants 2,882,871 2,882,871
with varying terms
------------ ------------
TOTAL $ 62,740,831 $ 67,162,390
============ ============
</TABLE>
13
<PAGE> 18
DIAMOND OFFSHORE CONTRIBUTION RETIREMENT PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
Year Ended December 31, 1998
<TABLE>
<CAPTION>
Current
Value of
Asset on
Description of Purchase Selling Cost of Transaction Net Gain
Identity of Party Involved Investment Price Price Asset Date (Loss)
<S> <C> <C> <C> <C> <C> <C>
TRANSACTIONS IN EXCESS OF 5%
OF PLAN ASSETS AS OF
DECEMBER 31, 1997
SINGLE TRANSACTIONS:
None
SERIES TRANSACTIONS:
Scudder Trust Company Scudder Stable Value Fund
Purchases $ 9,043,982 $ 9,043,982 $ 9,043,982
Sales $ 4,752,479 4,752,479 4,752,479
Scudder Trust Company Scudder Growth & Income Fund
Purchases 5,281,717 5,281,717 5,281,717
Sales 2,540,085 2,298,030 2,540,085 $ 242,055
Scudder Trust Company MFS Research Fund A
Purchases 3,146,292 3,146,292 3,146,292
Sales 1,912,081 1,628,441 1,912,081 283,640
Scudder Trust Company Putnam New Opportunities
Fund A
Purchases 4,826,170 4,826,170 4,826,170
Sales 2,673,102 2,298,179 2,673,102 374,923
</TABLE>
14
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the Plan administrative committee of the Diamond Offshore Defined
Contribution Plan (the "Plan"), which administers the Plan, has duly caused
this annual report to be signed on its behalf by the undersigned, thereunto
duly authorized, on the 28th day of June, 1999.
By: /s/ Robert L. Charles
Name: Robert L. Charles
Title: Administrative Committee Member
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No Description
- ---------- -----------
<S> <C>
23.1 Consent of Independent Auditors
</TABLE>
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333--22745 of Diamond Offshore Drilling, Inc. on Form S--8 of our report dated
June 16, 1999, appearing in this Annual Report on Form 11--K of Diamond
Offshore Defined Contribution Retirement Plan for the year ended December 31,
1998.
DELOITTE & TOUCHE LLP
Houston, Texas
June 28, 1999
