Valaris Posts $539.2 Million in Revenue Ahead of Quarterly Results After the Close
Key Facts
Valaris posted total operating revenue of $539.2 million in the second quarter of 2026, compared with $465.4 million in the first quarter, according to the company’s results. The company reported net income of $47 million, after recording a net loss of $18 million in the prior period. Adjusted EBITDA rose to $97 million from $67 million. The figures come as the company prepares to release third-quarter results after the New York Stock Exchange closes on November 2, 2026. Valaris said it does not plan to hold future earnings conferences or update forward-looking guidance amid its pending merger with Transocean.
Year over year, total operating revenue fell to $539.2 million in the second quarter from $615.2 million in the same period of 2025. Revenue excluding reimbursable items also declined, to $502.3 million from $572.3 million. But comparison with the prior quarter showed a different trend for that measure, as revenue excluding reimbursable items rose to $502 million from $430 million. The company attributed the quarterly increase mainly to more operating days for its floater fleet, after three rigs began working under new contracts during the first and second quarters. Revenue efficiency was 98% in the second quarter and year to date, while the Valaris DS-12 and Valaris DS-10 rigs returned to work during the quarter.
The impact of Middle East disputes remained a drag on earnings, with Valaris saying the conditions reduced adjusted EBITDA by about $30 million in the second quarter, compared with a negative impact of $8 million in the first quarter. The company attributed the impact to war-risk insurance costs, as well as costs and delays related to the Valaris 250 and Valaris 116 rig projects. Valaris 250 resumed its bareboat contract in July, while the Valaris 116 contract was expected to resume during the third quarter. The company said it expects these negative effects to moderate in the second half of 2026. In operations, revenue from the jackup segment, excluding reimbursable items, fell to $183 million from $196 million in the first quarter, which the company attributed in part to fewer operating days for Valaris 117.
Cash and cash equivalents fell to $541 million on June 30 from $578 million on March 31, with the company attributing the decline mainly to capital expenditures. Capital expenditures totaled $106 million in the second quarter, compared with $101 million in the first quarter. Valaris said operating cash flow and proceeds from asset sales offset part of the spending. In its operating outlook, the chief executive said the start of new contracts for two additional rigs before year-end, along with continued operational execution, is expected to drive further financial improvement during the rest of 2026. The company added that its deepwater contracting opportunity pipeline remains strong and that it expects further awards, supported by market fundamentals and customer demand for high-specification assets.
Valaris announced contracts and extensions on October 7 that added about $220 million to its associated contract backlog. The announcement included a contract for the DS-18 drillship to explore two wells for Petronas Suriname Exploration and Production. The contract is expected to begin in the fourth quarter of 2026 and run for up to seven months. This work adds to the contract base on which the company relies to operate its fleet, while management said the start of the two additional drillship contracts before year-end supports its outlook for improved financial performance. The Transocean deal remains a key milestone for shareholders; under its terms, each outstanding Valaris share will be exchanged for 15.235 Transocean shares, subject to customary adjustments before the deal takes effect.
A Valaris shareholder meeting is scheduled for November 24, 2026, at 10:00 a.m. Bermuda time, while Transocean shareholders will meet the same day at 3:00 p.m. Swiss time. Approval of the deal resolution at the Valaris shareholder meeting requires a numerical majority of those present and voting, representing at least 75% of the value of shares voted. The disclosure scheduled a Bermuda Supreme Court sanction hearing for November 26 at 11:00 a.m. Bermuda time. If the court sanctions the scheme, Transocean expects to complete the deal on or around December 1, 2026. Valaris will release third-quarter results after the market closes on November 2, while the company said the pending deal is behind its decision not to hold future earnings conferences or update guidance.