Borr Drilling — Earnings Release 2020

Aug 28, 2020

Borr Drilling Limited Announces Preliminary Results for the Second Quarter of 2020

Borr Drilling Limited Announces Preliminary Results for the Second Quarter of 2020

Hamilton, Bermuda, August 28, 2020: Borr Drilling Limited ("Borr", "Borr

Drilling" or the "Company") (NYSE: "BORR", OSE: "BDRILL") announces unaudited

results for the three and six months ended June 30, 2020.

Highlights in the Second Quarter of 2020

· Total operating revenues of $84.0 million, net loss of $109.6 million and

Adjusted EBITDA* of $(1.9) million for the second quarter of 2020. The adjusted

EBITDA includes approximately $12 million of non-recurring costs related to the

agreements reached with the Company's creditors in June 2020

· The combined Adjusted EBITDA of the four separate Mexican JVs that the

Company has 49% ownership in was $30.1 million in the second quarter 2020,

compared to negative EBITDA in the first quarter of 2020 of ($2.3) million, an

increase of $32.4 million quarter on quarter

· On April 30, 2020, the Company sold two standard jack-up drilling rigs, the

"Dhabi II" and the "Paragon B152", for total cash proceeds of $15.8 million,

leading to a gain on disposal of $12.8 million

· In May 2020, the Company exited its position in forward contracts for

Valaris shares

· In June 2020, the Company completed an equity offering raising gross

proceeds of $30 million

· In June 2020, the Company made several amendments to loan facilities with

its creditors and to the delivery schedule of rigs with its shipyards, resulting

in liquidity improvement mainly through deferral of payments of more than $315

million until the beginning of 2022

Subsequent events

· On August 10, 2020, the Company announced the appointment of Patrick Schorn

as new Chief Executive Officer

· In August, Pemex communicated a regular monthly payment plan to OPEX, the JV

providing Integrated Well Services, which should substantially improve the JV's

liquidity position, which in turn will benefit Borr

The Chairman of the Board, Paal Kibsgaard, commented:

"In the second quarter, we saw the full impact of the anticipated activity

reductions linked to COVID-19, resulting in a sequential decrease in operating

revenues of 19% to $84.0 million, and Adjusted EBITDA of $(1.9) million. The

adjusted EBITDA includes $12 million of non-recurring costs related to the

agreements reached with the Company's creditors in June 2020.

In the current challenging operating environment, Borr Drilling has been focused

on improving its liquidity runway and conserving cash. Through negotiations with

creditors and shipyards in June, we improved the Company's liquidity by $315

million through the start of 2022, mainly through deferral of payments.

Operationally, the Mexican business has improved significantly quarter on

quarter. The four JVs that the Company has ownership in delivered USD30m in

Adjusted EBITDA in the quarter. Additionally, we estimate that COVID-19 impacted

our Mexican JVs directly by $5.5 million in lost revenue and additional expenses

combined. The wells delivered by Borr's integrated services have, based on

Pemex's Q2 2020 report, increased Pemex production by 72k barrels/day. With the

quick payback and low breakeven for the customer we expect the integrated well

delivery business model to gain further traction going forward.

From a liquidity perspective, the operations of our Mexican JVs have suffered

from irregular payments and difficulties with factoring of receivables, which in

turn has put further strain on the Company's liquidity position. However, in

late August 2020, Pemex confirmed their commitment to enter into a regular

monthly payment plan to our JVs, which will reduce the working capital

requirements and allow cash distributions from the JVs to Borr, and thereby

improve Borr's liquidity position.

The improvement in oil prices during the spring of 2020 triggered demand for

putting three of our warm stacked units back to work. This shows the resilience

of the shallow water offshore drilling market and, as oil prices continue to

improve, we expect to put further units back to work in the future.

The distress in the offshore drilling industry is likely to force both needed

consolidation and fleet rationalisation going forward. Borr Drilling has a brand

-new jack-up drilling rig fleet and is well positioned to participate in such

consolidation if it benefits our shareholders."

The full report and financial statements is available in the enclosed file to

this release.

August 28, 2020

The Board of Directors

Borr Drilling Limited

Hamilton, Bermuda

Questions should be directed to:

Magnus Vaaler: VP Investor Relations and Treasury, +47 22 48 30 00

This information is subject to disclosure requirements pursuant to section 5-12

of the Norwegian Securities Trading Act.