Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Operations

Year ended December 31, 2017

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
REVENUE	$	—		$	48.7		$	1,283.2		$	(49.1	)	$	1,282.8

COSTS AND EXPENSES:
Direct operating costs (excluding items below)	—			0.5			727.3			(43.0		)	684.8
Depreciation and amortization	—			18.3			385.4			—			403.7
Selling, general and administrative	29.2			0.5			81.3			(6.1		)	104.9
Gain on sale of assets to unconsolidated subsidiary	—			—			(157.4		)	—			(157.4		)
Loss on disposals of property and equipment	—			1.7			7.7			—			9.4
Total costs and expenses	29.2			21.0			1,044.3			(49.1		)	1,045.4

Equity in earnings of unconsolidated subsidiary	—			—			0.9			—			0.9

INCOME (LOSS) FROM OPERATIONS	(29.2		)	27.7			239.8			—			238.3

OTHER INCOME (EXPENSE):
Interest expense	—			(155.8		)	(0.5		)	0.6			(155.7		)
Interest income	—			3.6			12.4			(0.6		)	15.4
Gain on extinguishment of debt	—			1.7			—			—			1.7
Other - net	20.4			(20.4		)	(0.4		)	—			(0.4		)
Total other income (expense) - net	20.4			(170.9		)	11.5			—			(139.0		)

INCOME (LOSS) BEFORE INCOME TAXES	(8.8		)	(143.2		)	251.3			—			99.3
Provision (benefit) for income taxes	—			(330.1		)	34.8			321.9			26.6
Equity in earnings of consolidated subsidiaries, net of tax	81.5			151.4			—			(232.9		)	—

NET INCOME	$	72.7		$	338.3		$	216.5		$	(554.8	)	$	72.7

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
REVENUE	$	—		$	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	—			(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) BEFORE INCOME TAXES	(7.3		)	(200.1		)	533.0			—			325.6
Provision (benefit) for income taxes	—			46.9			(6.7		)	(35.2		)	5.0
Equity in earnings (losses) of consolidated subsidiaries, net of tax	327.9			(17.2		)	—			(310.7		)	—

NET INCOME (LOSS)	$	320.6		$	(264.2	)	$	539.7		$	(275.5	)	$	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
REVENUE	$	—		$	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		)
Gain on litigation settlement	—			—			—			—			—
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) BEFORE INCOME TAXES	(3.1		)	(127.5		)	288.3			—			157.7
Provision for income taxes	—			32.9			48.6			(17.1		)	64.4
Equity in earnings (losses) of consolidated subsidiaries, net of tax	96.4			(128.5		)	—			32.1			—

NET INCOME (LOSS)	$	93.3		$	(288.9	)	$	239.7		$	49.2		$	93.3

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

Year ended December 31, 2017

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
NET INCOME	$	72.7		$	338.3		$	216.5	$	(554.8	)	$	72.7

OTHER COMPREHENSIVE LOSS:
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes	(33.3		)	(33.3		)	—		33.3			(33.3		)
Net reclassification adjustment for amounts recognized in net income as a component of net periodic benefit cost, net of income taxes	11.4			11.4			—		(11.4		)	11.4
									—
	(21.9		)	(21.9		)	—		21.9			(21.9		)

COMPREHENSIVE INCOME	$	50.8		$	316.4		$	216.5	$	(532.9	)	$	50.8

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		$	(264.2	)	$	539.7	$	(275.5	)	$	320.6

OTHER COMPREHENSIVE INCOME:
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes	(5.1		)	(5.1		)	—		5.1			(5.1		)
Net reclassification adjustment for amounts 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		$	(261.9	)	$	539.7	$	(277.8	)	$	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	$	(288.9	)	$	239.7	$	49.2		$	93.3

OTHER COMPREHENSIVE INCOME:
Net changes in pension and other postretirement plan assets and benefit obligations recognized in other comprehensive income (loss), net of income taxes	7.0		7.0			—		(7.0		)	7.0
Net reclassification adjustment for amounts 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	$	(268.1	)	$	239.7	$	28.4		$	114.1

Rowan Companies plc and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2017

(In millions)



	Rowan plc (Parent)			RCI (Issuer)		Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	0.2		$	206.3	$	1,125.6	$	—		$	1,332.1
Receivables - trade and other	—			1.2		211.6		—			212.8
Prepaid expenses and other current assets	0.3			10.7		4.5		—			15.5
Total current assets	0.5			218.2		1,341.7		—			1,560.4

Property and equipment - gross	—			241.9		8,592.0		—			8,833.9
Less accumulated depreciation and amortization	—			121.4		2,159.8		—			2,281.2
Property and equipment - net	—			120.5		6,432.2		—			6,552.7

Investments in consolidated subsidiaries	5,401.1			6,253.5		—		(11,654.6		)	—
Due from affiliates	0.2			680.0		11.5		(691.7		)	—
Long-term note receivable from unconsolidated subsidiary	—			—		270.2		—			270.2
Investment in unconsolidated subsidiary	—			—		30.9		—			30.9
Other assets	—			5.2		7.6		31.3			44.1
	$	5,401.8		$	7,277.4	$	8,094.1	$	(12,315.0	)	$	8,458.3

CURRENT LIABILITIES:
Accounts payable - trade	$	0.7		$	12.9	$	83.6	$	—		$	97.2
Deferred revenue	—			—		1.1		—			1.1
Accrued liabilities	0.1			95.6		63.4		—			159.1
Total current liabilities	0.8			108.5		148.1		—			257.4

Long-term debt, less current portion	—			2,510.3		—		—			2,510.3
Due to affiliates	11.2			11.4		669.1		(691.7		)	—
Other liabilities	3.8			261.2		28.6		—			293.6
Deferred income taxes - net	(0.1		)	182.7		10.9		(182.6		)	10.9
Shareholders' equity	5,386.1			4,203.3		7,237.4		(11,440.7		)	5,386.1
	$	5,401.8		$	7,277.4	$	8,094.1	$	(12,315.0	)	$	8,458.3

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 consolidated subsidiaries	5,115.8		6,054.6		—		(11,170.4		)	—
Due from affiliates	0.4		437.2		64.2		(501.8		)	—
Other assets	—		5.6		29.7		—			35.3
	5,120.2		7,401.3		7,826.3		(11,672.2		)	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 revenue	—		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	—		582.1		139.3		(535.7		)	185.7
Shareholders' equity	5,113.9		3,661.3		6,973.4		(10,634.7		)	5,113.9
	$	5,120.2	$	7,401.3	$	7,826.3	$	(11,672.2	)	$	8,675.6

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Year ended December 31, 2017

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(10.0	)	$	(11.3	)	$	336.2		$	(15.1	)	$	299.8

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	—			(18.3		)	(82.3		)	—			(100.6		)
Deposit on purchase of rigs	—			—			(7.7		)	—			(7.7		)
Investment in unconsolidated subsidiary	—			—			(30.0		)	—			(30.0		)
Contributions to unconsolidated subsidiary for note receivable	—			—			(357.7		)	—			(357.7		)
Proceeds from sale of assets to unconsolidated subsidiary	—			—			357.7			—			357.7
Repayments of note receivable from unconsolidated subsidiary	—			—			87.5			—			87.5
Proceeds from disposals of property and equipment	—			1.0			2.3			—			3.3
Investments in consolidated subsidiaries	—			32.6			—			(32.6		)	—

Net cash provided by (used in) investing activities	—			15.3			(30.2		)	(32.6		)	(47.5		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advances (to) from affiliates	12.2			(159.7		)	147.5			—			—
Distributions to issuer	—			—			(32.6		)	32.6			—
Reductions of long-term debt	—			(170.0		)	—			—			(170.0		)
Dividends paid	—			—			(15.1		)	15.1			—
Shares repurchased for tax withholdings on vesting of restricted share units	(5.7		)	—			—			—			(5.7		)

Net cash provided by (used in) financing activities	6.5			(329.7		)	99.8			47.7			(175.7		)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(3.5		)	(325.7		)	405.8			—			76.6
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	3.7			532.0			719.8			—			1,255.5

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	0.2		$	206.3		$	1,125.6		$	—		$	1,332.1

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) OPERATIING ACTIVITIES	$	(6.4	)	$	(82.8	)	$	1,101.3		$	(106.5	)	$	905.6

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 note receivable from consolidated subsidiary	—			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 ACTIVITES:
Advances (to) from affiliates	(2.0		)	58.2			(53.0		)	(3.2		)	—
Contributions from parent/issuer	—			—			80.8			(80.8		)	—
Proceeds from borrowings	—			500.0			—			—			500.0
Reductions of long-term debt	—			(511.8		)	(689.7		)	689.7			(511.8		)
Dividends paid	—			—			(109.7		)	109.7			—
Debt issue costs	—			(8.7		)	—			—			(8.7		)
Shares repurchased for tax withholdings on vesting of restricted share units	(5.0		)	—			—			—			(5.0		)
Excess tax benefits from share-based compensation	—			2.6			—			—			2.6

Net cash provided by (used in) financing activities	(7.0		)	40.3			(771.6		)	715.4			(22.9		)

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) OPERATING ACTIVITIES	$	(6.3	)	$	4.7		$	1,047.1		$	(47.4	)	$	998.1

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 note receivable from consolidated subsidiary	—			(481.3		)	—			481.3			—
Collections on note receivable from consolidated subsidiary	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 ACTIVITIES:
Advances (to) from affiliates	(7.4		)	89.9			(80.9		)	(1.6		)	—
Contributions from parent/issuer	—			—			37.5			(37.5		)	—
Proceeds from borrowings	—			220.0			481.3			(481.3		)	220.0
Reductions of long-term debt	—			(317.9		)	(540.1		)	540.1			(317.9		)
Dividends paid	(50.5		)	—			(49.0		)	49.0			(50.5		)
Shares repurchased for tax withholdings on vesting of restricted share units	(1.2		)	—			—			—			(1.2		)

Net cash used in financing activities	(59.1		)	(8.0		)	(151.2		)	68.7			(149.6		)

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