Shelf Drilling : September 30 2020 Quarterly Report

SHELF DRILLING, LTD.

QUARTERLY REPORT

NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

SHELF DRILLING, LTD.

INDEX TO QUARTERLY REPORT

NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

	(UNAUDITED)
	CONTENTS
PART I.	FINANCIAL INFORMATION	2
ITEM1.	FINANCIALSTATEMENTS(UNAUDITED)	2
	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS	3
	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE
	INCOME	4
	CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS	5
	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF EQUITY	6
	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS	7
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
	OPERATIONS	26
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	41
ITEM 4.	CONTROLS AND PROCEDURES	42
PART II.	OTHER INFORMATION	42
ITEM 1.	LEGAL PROCEEDINGS	42
ITEM 1A.	RISK FACTORS	42
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	43
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	43
ITEM 4.	MINE SAFETY DISCLOSURES	43
ITEM 5.	OTHER INFORMATION	43
ITEM 6.	EXHIBITS	43

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SHELF DRILLING, LTD.

NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(UNAUDITED)

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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SHELF DRILLING, LTD.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

				Three months ended September 30,			Nine months ended September 30,
				2020			2019			2020			2019
	Revenues
	Operating revenues..................................	$	125,106	$	128,958	$	452,645	$	405,810
	Other revenues.........................................			2,339			3,060			11,185			10,522
				127,445			132,018			463,830			416,332
	Operating costs and expenses
	Operating and maintenance.....................		78,956			91,446			262,863			274,621
	Depreciation.............................................			16,681			20,370			53,175			61,046
	Amortization of deferred costs................		9,495			19,836			34,237			57,086
	General and administrative......................			9,386			12,750			34,782			36,326
	Loss on impairment of assets..................		-			-			188,017			-
	(Gain) / loss on disposal of assets...........			(5,680)			638			(5,613)			(1,264)
				108,838			145,040			567,461			427,815
	Operating income / (loss)......................			18,607			(13,022)			(103,631)			(11,483)
	Other (expense) / income, net...............
	Interest income........................................			18			317			162			1,047
	Interest expense and financing charges...		(22,560)			(20,071)			(66,867)			(60,309)
	Other, net.................................................			(179)			86			(54)			(386)
				(22,721)			(19,668)			(66,759)			(59,648)
	Loss before income taxes......................			(4,114)			(32,690)			(170,390)			(71,131)
	Income tax expense.................................		3,565			3,241			14,083			8,072
	Net loss...................................................		$	(7,679)		$	(35,931)		$	(184,473)		$	(79,203)
	Loss per share:
	Basic and Diluted - Common shares.......	$	(0.06)	$	(0.26)	$	(1.36)	$	(0.63)
	Weighted average shares outstanding:
	Basic and Diluted - Common shares.......			136,182			137,961			136,142			125,442

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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