Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Operations

Year ended December 31, 2018

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
REVENUE	$	—		$	4.9		$	824.8		$	(4.9	)	$	824.8

COSTS AND EXPENSES:
Direct operating costs (excluding items below)	—			—			682.7			—			682.7
Depreciation and amortization	—			—			388.9			—			388.9
Selling, general and administrative	25.7			0.6			74.7			(4.9		)	96.1
Gain on sale of assets to unconsolidated subsidiary	—			—			(65.8		)	—			(65.8		)
Loss on disposals of property and equipment	—			3.7			8.4			—			12.1
Merger and related costs	8.9			—			—			—			8.9
Total costs and expenses	34.6			4.3			1,088.9			(4.9		)	1,122.9

Equity in earnings of unconsolidated subsidiary	—			—			10.3			—			10.3

INCOME (LOSS) FROM OPERATIONS	(34.6		)	0.6			(253.8		)	—			(287.8		)

OTHER INCOME (EXPENSE):
Interest expense	—			(151.0		)	(7.2		)	1.9			(156.3		)
Interest income	—			3.7			31.3			(1.9		)	33.1
Other - net	4.9			(1.7		)	8.8			—			12.0
Total other income (expense) - net	4.9			(149.0		)	32.9			—			(111.2		)

LOSS BEFORE INCOME TAXES	(29.7		)	(148.4		)	(220.9		)	—			(399.0		)
Provision (benefit) for income taxes	—			(87.6		)	36.0			—			(51.6		)
Equity in earnings (losses) of consolidated subsidiaries, net of tax	(317.7		)	162.7			—			155.0			—

NET INCOME (LOSS)	$	(347.4	)	$	101.9		$	(256.9	)	$	155.0		$	(347.4	)

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			727.5			(43.0		)	685.0
Depreciation and amortization	—			18.3			385.4			—			403.7
Selling, general and administrative	29.2			0.2			81.3			(6.1		)	104.6
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			20.7			1,044.5			(49.1		)	1,045.3

Equity in earnings of unconsolidated subsidiary	—			—			0.9			—			0.9

INCOME (LOSS) FROM OPERATIONS	(29.2		)	28.0			239.6			—			238.4

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			(20.7		)	(0.2		)	—			(0.5		)
Total other income (expense) - net	20.4			(171.2		)	11.7			—			(139.1		)

INCOME (LOSS) BEFORE INCOME TAXES	(8.8		)	(143.2		)	251.3			—			99.3
Provision (benefit) for income taxes	—			(8.2		)	34.8			—			26.6
Equity in earnings of consolidated subsidiaries, net of tax	81.5			209.4			—			(290.9		)	—

NET INCOME	$	72.7		$	74.4		$	216.5		$	(290.9	)	$	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)	—			12.4			796.4			(29.1		)	779.7
Depreciation and amortization	—			19.2			382.7			1.0			402.9
Selling, general and administrative	28.5			5.5			74.2			(6.0		)	102.2
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			38.0			1,294.0			(34.1		)	1,326.4

INCOME (LOSS) FROM OPERATIONS	(28.5		)	2.4			542.9			—			516.8

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			(20.9		)	(8.6		)	—			(8.3		)
Total other income (expense) - net	21.2			(202.5		)	(9.9		)	—			(191.2		)

INCOME (LOSS) BEFORE INCOME TAXES	(7.3		)	(200.1		)	533.0			—			325.6
Provision (benefit) for income taxes	—			5.1			(6.7		)	6.6			5.0
Equity in earnings of consolidated subsidiaries, net of tax	327.9			7.8			—			(335.7		)	—

NET INCOME (LOSS)	$	320.6		$	(197.4	)	$	539.7		$	(342.3	)	$	320.6

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

Year ended December 31, 2018

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments		Consolidated
NET INCOME (LOSS)	$	(347.4	)	$	101.9		$	(256.9	)	$	155.0	$	(347.4	)

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	(17.9		)	(17.9		)	—			17.9		(17.9		)
Net reclassification adjustment for amounts recognized in net income (loss) as a component of net periodic benefit cost, net of income taxes	(5.6		)	(5.6		)	—			5.6		(5.6		)

	(23.5		)	(23.5		)	—			23.5		(23.5		)

COMPREHENSIVE INCOME (LOSS)	$	(370.9	)	$	78.4		$	(256.9	)	$	178.5	$	(370.9	)

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		$	74.4		$	216.5	$	(290.9	)	$	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		$	52.5		$	216.5	$	(269.0	)	$	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		$	(197.4	)	$	539.7	$	(342.3	)	$	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		$	(195.1	)	$	539.7	$	(344.6	)	$	322.9

Rowan Companies plc and Subsidiaries

Condensed Consolidating Balance Sheets

December 31, 2018

(In millions)



	Rowan plc (Parent)		RCI (Issuer)		Non-guarantor subsidiaries		Consolidating adjustments			Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	2.5	$	324.6	$	699.6	$	—		$	1,026.7
Receivables - trade and other	0.2		2.6		248.4		—			251.2
Prepaid expenses and other current assets	0.4		8.3		13.7		—			22.4
Total current assets	3.1		335.5		961.7		—			1,300.3

Property and equipment - gross	—		247.3		8,405.1		—			8,652.4
Less accumulated depreciation and amortization	—		138.0		2,313.4		—			2,451.4
Property and equipment - net	—		109.3		6,091.7		—			6,201.0

Investments in consolidated subsidiaries	5,068.3		1,596.4		—		(6,664.7		)	—
Due from affiliates	0.1		5,357.4		14.1		(5,371.6		)	—
Long-term note receivable from unconsolidated subsidiary	—		—		456.0		—			456.0
Investment in unconsolidated subsidiary	—		—		41.2		—			41.2
Other assets	—		109.6		9.6		—			119.2
	$	5,071.5	$	7,508.2	$	7,574.3	$	(12,036.3	)	$	8,117.7

CURRENT LIABILITIES:
Current portion of long-term debt	$	—	$	201.2	$	—	$	—		$	201.2
Accounts payable - trade	4.3		10.2		107.8		—			122.3
Deferred revenue	—		—		16.7		—			16.7
Accrued liabilities	1.2		76.5		35.7		—			113.4
Total current liabilities	5.5		287.9		160.2		—			453.6

Long-term debt	—		2,309.7		—		—			2,309.7
Due to affiliates	28.7		8.6		5,334.3		(5,371.6		)	—
Other liabilities	2.3		264.3		41.1		—			307.7
Deferred income taxes - net	—		—		11.7		—			11.7
Shareholders' equity	5,035.0		4,637.7		2,027.0		(6,664.7		)	5,035.0
	$	5,071.5	$	7,508.2	$	7,574.3	$	(12,036.3	)	$	8,117.7

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		6,387.1		—		(11,788.2		)	—
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	—		36.4		7.7		—			44.1
	$	5,401.8	$	7,442.2	$	8,094.2	$	(12,479.9	)	$	8,458.3

CURRENT LIABILITIES:
Accounts payable - trade	$	0.7	$	12.9	$	83.6	$	—		$	97.2
Deferred revenue	—		—		1.1		—			1.1
Accrued liabilities	—		95.7		63.4		—			159.1
Total current liabilities	0.7		108.6		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	—		—		10.9		—			10.9
Shareholders' equity	5,386.1		4,550.7		7,237.5		(11,788.2		)	5,386.1
	$	5,401.8	$	7,442.2	$	8,094.2	$	(12,479.9	)	$	8,458.3

Rowan Companies plc and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Year ended December 31, 2018

(In millions)



	Rowan plc (Parent)			RCI (Issuer)			Non-guarantor subsidiaries			Consolidating adjustments			Consolidated
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(11.6	)	$	(139.6	)	$	41.1		$	(50.0	)	$	(160.1	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	—			(12.1		)	(157.1		)	—			(169.2		)
Purchase of rigs	—			—			(70.8		)	—			(70.8		)
Contributions to unconsolidated subsidiary for note receivable	—			—			(271.3		)	—			(271.3		)
Proceeds from sale of assets to unconsolidated subsidiary	—			—			266.0			—			266.0
Repayments of note receivable from unconsolidated subsidiary	—			—			98.5			—			98.5
Proceeds from disposals of property and equipment	—			1.4			11.3			—			12.7
Contributions to consolidated subsidiary for note receivable	—			(6.9		)	—			6.9			—
Collections on note receivable from consolidated subsidiary	—			1.9			—			(1.9		)	—
Investments in consolidated subsidiaries	—			(5.0		)	—			5.0			—
Net cash used in investing activities	—			(20.7		)	(123.4		)	10.0			(134.1		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advances (to) from affiliates	14.0			278.6			(292.6		)	—			—
Contributions from issuer	—			—			5.0			(5.0		)	—
Proceeds from borrowings	5.0			—			1.9			(6.9		)	—
Reductions of long-term debt	—			—			(1.9		)	1.9			—
Dividends paid	—			—			(50.0		)	50.0			—
Debt issue costs	—			—			(6.1		)	—			(6.1		)
Proceeds from exercise of share options	0.1			—			—			—			0.1
Shares repurchased for tax withholdings on vesting of restricted share units	(5.2		)	—			—			—			(5.2		)
Net cash provided by (used in) financing activities	13.9			278.6			(343.7		)	40.0			(11.2		)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	2.3			118.3			(426.0		)	—			(305.4		)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	0.2			206.3			1,125.6			—			1,332.1

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	2.5		$	324.6		$	699.6		$	—		$	1,026.7

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) OPERATIING 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 ACTIVITES:
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) OPERATING ACTIVITIES	$	(6.4	)	$	(58.8	)	$	1,101.3		$	(106.5	)	$	929.6

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 ACTIVITIES:
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		)
Payment of debt extinguishment costs	—			(24.0		)	—			—			(24.0		)
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		)	16.3			(771.6		)	715.4			(46.9		)

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