GUARANTEES OF REGISTERED SECURITIES

Rowan plc and its 100%-owned subsidiary, RCI, have entered into agreements providing for, among other things, the full, unconditional and irrevocable guarantee by Rowan plc of the prompt payment, when due, of any amount owed to the holders of RCI's Senior Notes and amounts outstanding under RCI’s revolving credit facility, if any.

The condensed consolidating financial information that follows is presented on the equity method of accounting in accordance with Rule 3-10 of Regulation S-X in connection with Rowan plc’s guarantee of the Senior Notes and reflects the corporate ownership structure as of December 31, 2016. Financial information as of December 31, 2015, and for the years ended December 31, 2015 and 2014 has been recast to reflect changes to the corporate ownership structure that occurred in 2016 and is presented as though the structure at December 31, 2016, was in place at January 1, 2014.

Subsequent to the issuance of the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, the Company’s management identified immaterial errors in its condensed consolidating balance sheet as of December 31, 2015, resulting in the understatement of RCI deferred income taxes - net by $22.2 million and the overstatement of RCI shareholders’ equity by the same amount. The prior period amounts within the Company’s condensed consolidating balance sheet as of December 31, 2015 have been revised to reflect the correct balances. These errors had no impact on our consolidated financial statements.

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Operations

Year ended December 31, 2016

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
REVENUES	$	—		$	40.4		$	1,836.9		$	(34.1	)	$	1,843.2

COSTS AND EXPENSES:
Direct operating costs (excluding items below)	—			12.2			795.1			(29.1		)	778.2
Depreciation and amortization	—			19.2			382.7			1.0			402.9
Selling, general and administrative	28.5			5.4			74.2			(6.0		)	102.1
Loss on disposals of property and equipment	—			0.9			7.8			—			8.7
Material charges and other operating items	—			—			32.9			—			32.9
Total costs and expenses	28.5			37.7			1,292.7			(34.1		)	1,324.8

INCOME (LOSS) FROM OPERATIONS	(28.5		)	2.7			544.2			—			518.4

OTHER INCOME (EXPENSE):
Interest expense, net of interest capitalized	—			(155.5		)	(4.1		)	4.1			(155.5		)
Interest income	—			5.1			2.8			(4.1		)	3.8
Loss on extinguishment of debt	—			(31.2		)	—			—			(31.2		)
Other - net	21.2			(21.2		)	(9.9		)	—			(9.9		)
Total other income (expense) - net	21.2			(202.8		)	(11.2		)	—			(192.8		)

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	(7.3		)	(200.1		)	533.0			—			325.6
Provision for income taxes	—			66.3			(6.7		)	(54.6		)	5.0

INCOME (LOSS) FROM CONTINUING OPERATIONS	(7.3		)	(266.4		)	539.7			54.6			320.6

DISCONTINUED OPERATIONS, NET OF TAX	—			—			—			—			—

EQUITY IN EARNINGS OF SUBSIDIARIES, NET OF TAX	327.9			33.9			—			(361.8		)	—

NET INCOME (LOSS)	$	320.6		$	(232.5	)	$	539.7		$	(307.2	)	$	320.6

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Operations

Year ended December 31, 2015

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
REVENUES	$	—		$	60.0		$	2,133.4		$	(56.4	)	$	2,137.0

COSTS AND EXPENSES:
Direct operating costs (excluding items below)	—			15.0			1,028.5			(50.4		)	993.1
Depreciation and amortization	—			19.5			370.4			1.5			391.4
Selling, general and administrative	26.2			5.4			91.7			(7.5		)	115.8
(Gain) loss on disposals of property and equipment	—			0.9			(8.6		)	—			(7.7		)
Material charges and other operating items	—			—			337.3			—			337.3
Total costs and expenses	26.2			40.8			1,819.3			(56.4		)	1,829.9

INCOME (LOSS) FROM OPERATIONS	(26.2		)	19.2			314.1			—			307.1

OTHER INCOME (EXPENSE):
Interest expense, net of interest capitalized	—			(145.3		)	(22.8		)	22.8			(145.3		)
Interest income	0.8			22.1			1.0			(22.8		)	1.1
Loss on extinguishment of debt	—			(1.5		)	—			—			(1.5		)
Other - net	22.3			(22.0		)	(4.0		)	—			(3.7		)
Total other income (expense) - net	23.1			(146.7		)	(25.8		)	—			(149.4		)

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	(3.1		)	(127.5		)	288.3			—			157.7
Provision for income taxes	—			29.7			48.6			(13.9		)	64.4

INCOME (LOSS) FROM CONTINUING OPERATIONS	(3.1		)	(157.2		)	239.7			13.9			93.3

DISCONTINUED OPERATIONS, NET OF TAX	—			—			—			—			—

EQUITY IN EARNINGS (LOSSES) OF SUBSIDIARIES, NET OF TAX	96.4			(136.4		)	—			40.0			—

NET INCOME (LOSS)	$	93.3		$	(293.6	)	$	239.7		$	53.9		$	93.3

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Operations

Year ended December 31, 2014

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
REVENUES	$	—		$	63.8		$	1,824.6		$	(64.0	)	$	1,824.4

COSTS AND EXPENSES:
Direct operating costs (excluding items below)	—			3.7			1,048.2			(60.6		)	991.3
Depreciation and amortization	—			13.7			307.7			1.2			322.6
Selling, general and administrative	26.3			—			104.1			(4.6		)	125.8
(Gain) loss on disposals of property and equipment	—			(4.9		)	3.2			—			(1.7		)
Gain on litigation settlement	—			—			(20.9		)	—			(20.9		)
Material charges and other operating items	—			12.2			561.8			—			574.0
Total costs and expenses	26.3			24.7			2,004.1			(64.0		)	1,991.1

INCOME (LOSS) FROM OPERATIONS	(26.3		)	39.1			(179.5		)	—			(166.7		)

OTHER INCOME (EXPENSE):
Interest expense, net of interest capitalized	—			(103.9		)	(3.1		)	3.1			(103.9		)
Interest income	0.3			3.5			1.1			(3.1		)	1.8
Other - net	22.4			(22.3		)	(0.9		)	—			(0.8		)
Total other income (expense) - net	22.7			(122.7		)	(2.9		)	—			(102.9		)

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	(3.6		)	(83.6		)	(182.4		)	—			(269.6		)
Benefit for income taxes	—			(116.6		)	(36.2		)	2.1			(150.7		)

INCOME (LOSS) FROM CONTINUING OPERATIONS	(3.6		)	33.0			(146.2		)	(2.1		)	(118.9		)

DISCONTINUED OPERATIONS, NET OF TAX	—			4.0			—			—			4.0

EQUITY IN LOSSES OF SUBSIDIARIES, NET OF TAX	(111.3		)	(141.7		)	—			253.0			—

NET LOSS	$	(114.9	)	$	(104.7	)	$	(146.2	)	$	250.9		$	(114.9	)

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

Year ended December 31, 2016

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
NET INCOME (LOSS)	$	320.6		$	(232.5	)	$	539.7	$	(307.2	)	$	320.6

OTHER COMPREHENSIVE INCOME:
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income, net of income taxes	(5.1		)	(5.1		)	—		5.1			(5.1		)
Net reclassification adjustments for amount recognized in net income (loss) as a component of net periodic benefit cost, net of income taxes	7.4			7.4			—		(7.4		)	7.4
									—
	2.3			2.3			—		(2.3		)	2.3

COMPREHENSIVE INCOME (LOSS)	$	322.9		$	(230.2	)	$	539.7	$	(309.5	)	$	322.9

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

Year ended December 31, 2015

(In millions)



	Rowan plc (Parent)		RCI (Issuer)			Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
NET INCOME (LOSS)	$	93.3	$	(293.6	)	$	239.7	$	53.9		$	93.3

OTHER COMPREHENSIVE INCOME:
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income, net of income taxes	7.0		7.0			—		(7.0		)	7.0
Net reclassification adjustments for amount recognized in net income (loss) as a component of net periodic benefit cost, net of income taxes	13.8		13.8			—		(13.8		)	13.8

	20.8		20.8			—		(20.8		)	20.8

COMPREHENSIVE INCOME (LOSS)	$	114.1	$	(272.8	)	$	239.7	$	33.1		$	114.1

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

Year ended December 31, 2014

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET LOSS	$	(114.9	)	$	(104.7	)	$	(146.2	)	$	250.9		$	(114.9	)

OTHER COMPREHENSIVE INCOME (LOSS):
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income, net of income taxes	(87.3		)	(87.3		)	—			87.3			(87.3		)
Net reclassification adjustments for amount recognized in net loss as a component of net periodic benefit cost, net of income taxes	9.8			9.8			—			(9.8		)	9.8

	(77.5		)	(77.5		)	—			77.5			(77.5		)

COMPREHENSIVE LOSS	$	(192.4	)	$	(182.2	)	$	(146.2	)	$	328.4		$	(192.4	)

Rowan Companies plc and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2016

(In millions)



	Rowan plc (Parent)		RCI (Issuer)		Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	3.7	$	532.0	$	719.8	$	—		$	1,255.5
Receivables - trade and other	—		1.8		299.5		—			301.3
Prepaid expenses and other current assets	0.3		12.9		10.3		—			23.5
Total current assets	4.0		546.7		1,029.6		—			1,580.3

Property and equipment - gross	—		631.0		8,469.8		—			9,100.8
Less accumulated depreciation and amortization	—		273.8		1,767.0		—			2,040.8
Property and equipment - net	—		357.2		6,702.8		—			7,060.0

Investments in subsidiaries	5,115.8		6,097.9		—		(11,213.7		)	—
Due from affiliates	0.4		437.2		64.2		(501.8		)	—
Other assets	—		5.6		29.7		—			35.3
	$	5,120.2	$	7,444.6	$	7,826.3	$	(11,715.5	)	$	8,675.6

CURRENT LIABILITIES:
Current portion of long-term debt	$	—	$	126.8	$	—	$	—		$	126.8
Accounts payable - trade	0.4		22.4		71.5		—			94.3
Deferred revenues	—		0.1		103.8		—			103.9
Accrued liabilities	0.3		107.4		51.1		—			158.8
Total current liabilities	0.7		256.7		226.4		—			483.8

Long-term debt, less current portion	—		2,553.4		—		—			2,553.4
Due to affiliates	0.4		63.9		437.5		(501.8		)	—
Other liabilities	5.2		283.9		49.7		—			338.8
Deferred income taxes - net	—		598.3		139.3		(551.9		)	185.7
Shareholders' equity	5,113.9		3,688.4		6,973.4		(10,661.8		)	5,113.9
	$	5,120.2	$	7,444.6	$	7,826.3	$	(11,715.5	)	$	8,675.6

Rowan Companies plc and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2015

(In millions)



	Rowan plc (Parent)		RCI (Issuer)		Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	17.3	$	9.5	$	457.4	$	—		$	484.2
Receivables - trade and other	0.1		1.4		409.0		—			410.5
Prepaid expenses and other current assets	0.4		19.3		6.9		—			26.6
Total current assets	17.8		30.2		873.3		—			921.3

Property and equipment - gross	—		592.8		8,475.3		—			9,068.1
Less accumulated depreciation and amortization	—		242.7		1,419.6		—			1,662.3
Property and equipment - net	—		350.1		7,055.7		—			7,405.8

Investments in subsidiaries	4,763.3		6,026.5		—		(10,789.8		)	—
Due from affiliates	0.6		1,218.2		55.8		(1,274.6		)	—
Other assets	—		5.0		15.2		—			20.2
	4,781.7		7,630.0		8,000.0		(12,064.4		)	8,347.3

CURRENT LIABILITIES:
Current portion of long-term debt	—		—		—		—			—
Accounts payable - trade	1.0		19.1		89.5		—			109.6
Deferred revenues	—		—		33.1		—			33.1
Accrued liabilities	0.7		119.4		65.9		—			186.0
Total current liabilities	1.7		138.5		188.5		—			328.7

Long-term debt, less current portion	—		2,692.4		—		—			2,692.4
Due to affiliates	2.9		55.8		1,215.9		(1,274.6		)	—
Other liabilities	4.6		304.7		48.6		—			357.9
Deferred income taxes - net	—		544.5		150.8		(499.5		)	195.8
Shareholders' equity	4,772.5		3,894.1		6,396.2		(10,290.3		)	4,772.5
	$	4,781.7	$	7,630.0	$	8,000.0	$	(12,064.4	)	$	8,347.3

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Year ended December 31, 2016

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET CASH PROVIDED BY (USED IN) OPERATIONS	$	(11.4	)	$	(82.8	)	$	1,101.3		$	(106.5	)	$	900.6

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	—			(44.5		)	(73.1		)	—			(117.6		)
Proceeds from disposals of property and equipment	—			0.4			5.8			—			6.2
Collections on subsidiary note receivable	—			689.7			—			(689.7		)	—
Investments in consolidated subsidiaries	(0.2		)	(80.6		)	—			80.8			—

Net cash provided by (used in) investing activities	(0.2		)	565.0			(67.3		)	(608.9		)	(111.4		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advances (to) from affiliates	(2.0		)	58.2			(53.0		)	(3.2		)	—
Contributions from issuer	—			—			80.8			(80.8		)	—
Proceeds from borrowings	—			500.0			—			—			500.0
Repayments of borrowings	—			(511.8		)	(689.7		)	689.7			(511.8		)
Dividends paid	—			—			(109.7		)	109.7			—
Debt issue costs	—			(8.7		)	—			—			(8.7		)
Excess tax benefits from share-based compensation	—			2.6			—			—			2.6

Net cash provided by (used in) financing activities	(2.0		)	40.3			(771.6		)	715.4			(17.9		)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(13.6		)	522.5			262.4			—			771.3
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	17.3			9.5			457.4			—			484.2

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	3.7		$	532.0		$	719.8		$	—		$	1,255.5

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Year ended December 31, 2015

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET CASH PROVIDED BY (USED IN) OPERATIONS	$	(7.5	)	$	4.7		$	1,047.1		$	(47.4	)	$	996.9

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	—			(23.2		)	(699.7		)	—			(722.9		)
Proceeds from disposals of property and equipment	—			2.9			16.5			—			19.4
Advances on subsidiary note receivable	—			(481.3		)	—			481.3			—
Collections on subsidiary note receivable	36.6			503.5			—			(540.1		)	—
Investments in consolidated subsidiaries	0.2			(37.7		)	—			37.5			—

Net cash provided by (used in) investing activities	36.8			(35.8		)	(683.2		)	(21.3		)	(703.5		)

CASH FLOWS FROM FINANCING ACTIVITES:
Advances (to) from affiliates	(7.4		)	89.9			(80.9		)	(1.6		)	—
Contributions from issuer	—			—			37.5			(37.5		)	—
Proceeds from borrowings	—			220.0			481.3			(481.3		)	220.0
Repayments of borrowings	—			(317.9		)	(540.1		)	540.1			(317.9		)
Dividends paid	(50.5		)	—			(49.0		)	49.0			(50.5		)

Net cash used in financing activities	(57.9		)	(8.0		)	(151.2		)	68.7			(148.4		)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(28.6		)	(39.1		)	212.7			—			145.0
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	45.9			48.6			244.7			—			339.2

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	17.3		$	9.5		$	457.4		$	—		$	484.2

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Year ended December 31, 2014

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET CASH PROVIDED BY OPERATIONS	$	63.8		$	82.5		$	452.9		$	(176.2	)	$	423.0

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	—			(21.1		)	(1,937.1		)	—			(1,958.2		)
Proceeds from disposals of property and equipment	—			14.6			7.4			—			22.0
Investments in consolidated subsidiaries	—			(105.3		)	—			105.3			—

Net cash used in investing activities	—			(111.8		)	(1,929.7		)	105.3			(1,936.2		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advances (to) from affiliates	(49.2		)	(731.8		)	782.2			(1.2		)	—
Contributions from issuer	—			—			105.3			(105.3		)	—
Proceeds from borrowings	—			793.4			—			—			793.4
Dividends paid	(37.7		)	(75.0		)	(102.4		)	177.4			(37.7		)
Debt issue costs	—			(0.7		)	—			—			(0.7		)
Proceeds from exercise of share options	4.7			—			—			—			4.7
Excess tax benefits from share-based compensation	—			(0.1		)	—			—			(0.1		)

Net cash provided by (used in) financing activities	(82.2		)	(14.2		)	785.1			70.9			759.6

DECREASE IN CASH AND CASH EQUIVALENTS	(18.4		)	(43.5		)	(691.7		)	—			(753.6		)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	64.3			92.1			936.4			—			1,092.8

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	45.9		$	48.6		$	244.7		$	—		$	339.2