Welcome, everyone, to the Valaris First Quarter 2023 Conference Call. With me today: are President and CEO, Anton Dibowitz, Senior Vice President and CFO, Chris Weber, Senior Vice President and CCO, Matt Lyne and other members of our executive management team. We issued our press release, which is available on our website at valaris.com. Any comments we make today about expectations are forward-looking statements and are subject to risks and uncertainties. Many factors could cause actual results to differ materially from our expectations. Please refer to our press release and SEC filings on our website that define forward-looking statements and list risk factors and other events that could impact future results. Also, please note that the Company undertakes no duty to update forward-looking statements. During this call, we will refer to GAAP and non-GAAP financial measures. Please see the press release on our website for additional information and required reconciliations. As a reminder, yesterday, we issued our most recent Fleet Status Report, which provides details on contracts across our rig fleet. An updated investor presentation and ARO Drilling presentation will be available on our website after the call. Now, I’ll turn the call over to Anton Dibowitz, President and CEO.

Thanks, Darin, and good morning and afternoon to everyone. During today's call, I will start by providing an overview of our performance during the quarter. I'll then comment on the refinancing we recently executed along with an update on our capital allocation strategy. Finally, I'll provide commentary on the outlook for the offshore drilling market and discuss our fleet strategy. After that, I'll hand the call over to Chris to discuss our financial results and guidance. During the first quarter, we achieved strong revenue efficiency of 99%, and I commend the entire Valaris team for their dedication to delivering excellent performance for our customers. The outlook for our business remains strong, and we recognize that the success of our operations depends upon the skills and expertise of our employees. We continue to invest in our people in order to recruit, train and retain the best talent in our industry. In addition to the initiatives I've mentioned on previous conference calls, such as our new hire orientation and BOLD offshore leadership training, we are partnering with ICM Group and Robert Gordon University in Aberdeen to provide innovative and high-quality training to our employees, including, of course, on enhanced well control. I also want to acknowledge that our people work in the hazardous industry, keeping our employees and all those who work with us safe is always our number one priority and any incident that impacts the brave men and women that work on our rigs is personal to me and all of us at Valaris. We are proud of the safety systems, processes and culture we have built at Valaris, and we will continue to understand, share and learn when incidents occur to help protect all of the individuals who work on our rigs. Turning to our financial performance for the…

Thanks, Anton, and good morning and afternoon, everyone. I'm going to start with a review of our first quarter results. Adjusted EBITDA was $24 million, compared to $54 million in the prior quarter, and adjusted EBITDAR was $51 million, compared to $75 million in the prior quarter. Excluding reimbursable items, revenues decreased to $408 million from $413 million, primarily due to lower utilization for the harsh environment jackup fleet, partially offset by higher average day rates for the floater fleet. Jackup revenues decreased primarily due to lower utilization for our North Sea fleet, including expected idle time for all three of our in-class jackups, as well as VALARIS 121 and 247. Floater revenues increased primarily due to higher day rates for VALARIS DPS-5 and DS-12, which commenced new higher day rate contracts during the quarter. This was partially offset by lower utilization primarily related to VALARIS DS-12, which mobilized from Mauritania to Angola during the quarter prior to commencing operations for another customer. Excluding reimbursable items, contract drilling expense increased to $356 million from $333 million primarily due to increased repair and maintenance costs associated with planned special periodic surveys and higher reactivation costs, which increased to $26 million from $21 million. General and administrative expense of $24 million and depreciation expense of $23 million were largely in line with the prior quarter. Other income was $13 million compared to other expense of less than $1 million in the prior quarter. This was primarily due to foreign currency exchange gains compared to losses in the prior quarter and an increase in interest income due to a higher interest rate on the ARO shareholder notes receivable as well as an increase in interest from short-term deposits. We had a tax benefit of $28 million in the quarter compared to tax expense…

Thank you. We will now begin the question-and-answer session [Operator Instructions] At this time, we will pause momentarily to assemble our roster. Today's first question comes from Kurt Hallead with Benchmark. Please go ahead.

Thank you, very good morning, everybody.

Good morning. A – Anton Dibowitz: Good morning, Kurt.

So Anton, you mentioned that there is a good prospect that you could activate another idle drillship -- Drillship this year. Just wondering if you might be able to just kind of remind us what costs you may incur in doing that. And give us some perspective on what impact that could have on the EBITDA guidance range you just reiterated? A – Anton Dibowitz: I'll let Chris start with reactivation costs and then maybe I'll come back afterwards on kind of opportunities and how we see it.

Yes. So from a cost perspective, we've been talking about a guidance range of $65 million to $75 million. We're probably at the top end of that range right now around $75 million. From an EBITDA impact, it would really depend on when that reactivation project started. So -- but yes, again, with probably two-thirds of that $75 million being expensed and one-third being CapEx, there would be EBITDA hit in the year if we start another reactivation project. A – Anton Dibowitz: Okay. As far as the opportunities, I think if you look at what I said about the market, a lot of the rigs that are on contract with folks are being recontracted by the same customer in the same basin -- we're seeing -- we talked about the number of opportunities -- incremental opportunities. We're seeing come to market, which are really opportunities for either reactivated rigs, stacked drillships or otherwise some of the stranded assets at the yards. So we feel comfortable that there's going to be an opportunity for at least one reactivation. How we think about it, there is pressure on pricing, but with day rates where they are, in the kind of low to mid 400s and opportunities to be outside that range as the market continues to tighten, we'll continue to fill our philosophy, which we've been clear on from the start is that we will seek to get the reactivation and a meaningful return on those reactivation costs under the initial firm contract, and we believe that that's very much achievable where the market is right now.

All right. That's great color. Really appreciate it. That's it for me. A – Anton Dibowitz: Thanks.

The next question comes from Eddie Kim with Barclays. Please go ahead.

Hi. Good morning. So one of your major peers just an hour go talked about their expectation to see leading edge day rates exceed 500,000 a day by the end of the year, which seems to contrast with your comments that day rates have moderated recently. So could you just comment on where you expect leading-edge day rates to be by year-end? Would you expect us to reach that $500 million mark, or based on what you're seeing to that level be pushed out into sometime next year?

Eddie, that's a good question. And I think part of it depends on how you define day rates, effective day rate, clean day rate, ex mobilization and where the trend is going. I think maybe we should take a step back and see what's happened with day rates over the last period. So over the last couple of years, day rates of have more than doubled from the low 200s to the mid-400s. And I'd say, the general clearing range, if you look at contracts that are being signed today are in the kind of low to mid-40s. That's not to say that they aren't going to be fixtures outside that band. Some may be a little lower and significantly higher depending on the contract. I mean, we did a contract that had -- if you divide the total contract value over the working days in the contract, that was north of $600,000 a day last year. So I think it depends on how you classify the day rate. What I can say is that the day rates continue to grind higher. I think there's been some concerns, some talk in the market about the fact that not every fixture is higher than the last fixture. I wouldn't read too much into that. When you look at where fixtures are going over time, those -- the day rates in the market continue to grind higher. And yes, I think it's a real possibility that we'll see day rates as the market continues to tighten, trend above $500,000 a day. it depends on what contract, what market, where you're positioning your rigs in your portfolio, whether you're rolling an existing rig, which is already attractively placed in the market and you're comfortable taking some baseload contract duration and generating significant cash flow, whether you're talking about reactivating a rig where we're going to be more disciplined on it, and I think others are as well in recovering those costs and you expect the higher effective day rates on that contract in order to bring another asset into the market. So I hope that provides some color.

I appreciate that clarification. Thank you for that comprehensive response. Just a follow-up is on kind of global recession concerns, which seems to be at the forefront of people's minds these days. You painted a bullish outlook for the floater market with many opportunities over the next 12 to 18 months, particularly in Brazil and West Africa. But based on your conversation with customers, is there an oil price at which you would expect customers to pull back on activity. I mean, I understand most of these customers are very long-term focused, but any kind of color on recent customer conversations would be good.

I think you hit the nail on the head in the fact that our customers are longer-term focused. We didn't see a massive spike in activity or customers' requirements when Ukraine happened and oil prices spiked. What they're really focused on is, is longer-term prices kind of the three and five-year strip. And when oil prices are $60, $70, above $70 a barrel, they're focused on the pricing reserves after years of underinvestment and the need for energy, which continues to grow. I think as EIA, global demand for oil and gas continues to grow. And the resources are needed and our customers are making record profits. They see attractive opportunities and a need to replace reserves. So yes, it is a volatile macro market or geopolitical events and potential recession. But in our conversations with our customers, that does not change their plans and what they need to do to replace reserves to produce in the long term, and that's what they're definitely more focused on. I made some comments in my prepared remarks, given continued tightening in the market, we're starting to have conversations with customers for the first time in a long time, about potentially contracting rigs beyond their sanctioned projects, because they realize that they want to have access to attractive drillships, especially for the long term and that they're going to continue drilling for a significant period of time and thinking about securing some of that capacity for the longer term even beyond the current program that a rig may be on. And I think that's a really good sign for our customers' confidence in the market and where it's going and a good signpost for our industry.

I'd just add, our customers are focused on the structural supply deficit. And offshore is very attractive from an economic perspective. They're meaningful size of fine from a production growth perspective, and at least carbon-intensive barrels and productivity on US land is going down. So the -- their focus is on the long term.

I will say that there is a -- the market is volatile, geopolitical and economic and that's one of the reasons we want to continue to have a disciplined and prudent capital structure, low levels of leverage, make sure that we have liquidity available to continue to execute on being focused and value driven for the long term.

Got it. Great. Thank you for all that color. I'll turn it back.

[Operator Instructions] The next question today is from David Smith with Pickering Energy Partners. Please go ahead.

Thanks. Good morning and congratulations on the refinancing and being in a position to upsize and execute the buyback.

Thanks, Dave.

So assuming you exercised the option to purchase the DS-13, can you remind me on how to think about the timing between when that action is exercised and when that rig could actually be on location to start a contract?

Timing-wise, I would think about both the DS-13 and the 14 much like a reactivation of one of our preservation stacked assets. We've talked about reactivations given our assets being around 12 months, that's stretched out from kind of six to nine months a year ago. That's what we're planning on the current reactivations we have going on, the 17 and the eight, and we're on schedule with both of those assets, and I think about the 13 and the 14 kind of in the same realm.

Appreciate that. And the related follow-up is I wanted to ask how you think about the marketing strategy for one of your stack drillships versus securing contracts for the DS-13 or 14? And maybe should we think about those targeting separate opportunities, maybe where the DS-13 would feel more challenging demand?

Look, obviously, everything else being equal, would like to get a longer term contract when we're looking for a contract for the 13 and the 14. And we've been clear on kind of the order that we think about these things is keep the active rigs continuously utilized, look at attractive high-spec preservation stacked assets and the options, and there are options come after that. But I also think we need to differentiate and kind of provide the discussion about the purchase price and the reactivation costs and putting those rigs to work. And when you see that trading prices where stranded assets have traded in the low to mid-200s of the deals that have been done, both the DS-13 and DS-14 have two BOPs, which not a lot of assets that are stranded at the yard have an additional kind of $50 million expenditure, think about it that way. On a pure steel price basis, the DS-13 is less than half of where these assets are trading at the market. So, it is a very attractive option, and that's why we say we probably seek to exercise that option. 14 is close to attractive versus where assets have been trading, but it is an option, and we will continue to evaluate that against other uses of capital.

Much appreciate it. I'll circle back.

Thanks.

There are no further questions in the queue. This concludes our question-and-answer session. I would like to turn the conference back over to Darren Gibbons for any closing remarks.

Thanks, Andrea, and thank you to everyone on the call for your interest in Valaris. We look forward to speaking with you again when we report our second quarter 2023 results. Have a great rest of your day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.