For immediate release

KCA Deutag Announces Third Quarter 2022 Results

o Third quarter results with Revenues of $266 million, EBITDA of $49 million and
operating profit of $22 million.
o Excluding Russia, third quarter results with Revenues of $250 million, EBITDA of $46
million and operating profit of $20 million.
o Closing cash position at quarter end of $178 million with net debt of $322 million.
o First and largest phase of the Saipem Onshore Drilling acquisition completed on 28
October with the integration underway to #becomeoneteam.
o Group has fully exited and classified its Russian business as discontinued operations.
o Improving base business and ongoing rig reactivations support a stronger forward
performance.
o Saipem acquisition increases backlog to $6.6b at 1 November 2022, with firm portion
significantly strengthening from $2.3b to $4.0b.

KCA Deutag Alpha Limited (“KCA Deutag” or the “Group”) today announced its results for
the third quarter of 2022.

To remain compliant with all applicable sanctions, KCA Deutag has fully exited the Russian
business and will no longer recognise any results from 21 July 2022. As a result, this business
has been classified as discontinued operations.

Revenues for the third quarter of 2022 were $266 million, compared to $338 million and $301
million in the prior quarter and third quarter of 2021, respectively. Excluding Russia, revenues
for the third quarter of 2022 were $250 million, compared to $242 million in the third quarter of
2021.

Operating profit (pre-exceptional) was $22 million in the third quarter of 2022, compared to
$37 million and $26 million in the prior quarter and third quarter of 2021, respectively.
Excluding Russia, operating profit (pre-exceptional) was $20 million in the third quarter of
2022, compared to $13 million in the third quarter of 2021.

EBITDA was $49 million in the third quarter of 2022, compared to $67 million and $62 million
in the prior quarter and third quarter of 2021, respectively. Excluding Russia, EBITDA was $46
million in the third quarter of 2022, compared to $42 million in the third quarter of 2021.

The Company’s third quarter 2022 profit after tax1 was $23 million, compared to $35 million
and $5 million in the prior quarter and third quarter of 2021, respectively. Excluding Russia,
the Company’s third quarter 2022 profit after tax1 was $18 million, compared to a loss after
tax1 of $5 million in the third quarter of 2021.

Page 1
1 Profit/loss after tax stated before exceptional items
Third quarter 2022 net cash flows from operating activities were an inflow of $21 million,
compared to outflow of $4 million and inflow of $72 million in the prior quarter and third quarter
of 2021, respectively. Excluding Russia third quarter 2022 net cash flows from operating
activities were an inflow of $19 million.

Capital expenditures were $15 million in the third quarter of 2022, compared to $14 million
and $12 million in the prior quarter and third quarter of 2021, respectively. There was no
Russian capital expenditure during Q3 2022.

Joseph Elkhoury, KCA Deutag Chief Executive Officer commented:

“The first and largest phase of the Saipem Onshore Drilling acquisition completed on 28
October and the integration is underway to #becomeoneteam. This milestone and exciting
transaction, which included the operations in Saudi Arabia, UAE and Africa, will significantly
expand and upgrade our business in the Middle East, a core and active market for our Group.

I want to thank all those involved in delivering this transaction. Together with our new
colleagues, we will build a leading international business, further #enhancethebrand and
deliver accretive value to all our stakeholders: our employees, our customers, our investors
and the communities where we live and work.

The Russian business has now been fully isolated from the Group. Maintaining economic
discipline has allowed us to bridge the gap from the painful loss of this business.

We are making good progress with our strategy for clean energy. Recent wins and promising
projects help us diversify our revenue streams and actively play our role in the energy
transition.

We are optimistic and believe that momentum from the Saipem acquisition, supportive market
conditions that are improving our base business, planned rig reactivations, recent wins and
expected contract extensions, the increasing bidding activity and ongoing customer
conversations will allow us to deliver stronger results in the fourth quarter and beyond.”

Operational Review
Land Drilling
Our core Middle East business continues to perform strongly as rig reactivations continue. In
Saudi, KCA Deutag’s last suspended rig was reactivated at the end of Q3, with the remaining
two Saipem rigs expected by the end of Q4.

In Iraq and Algeria, we are seeing indicators that IOC’s are developing additional projects in
these markets which is giving us confidence that activity will soon increase.

The European market is strengthening as governments focus on energy security leading to

increasing oil and gas drilling. We are also seeing a higher number of geothermal projects
within this market, as Europe drives to increase its production of low carbon energy.

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In September we announced an exciting new geothermal contract with Eavor. We will provide
two drilling rigs operating simultaneously to deliver the construction of their patented
technology providing a sustainable source of heat and power.

Offshore
In Offshore we have added an 8th platform to our Azerbaijan contract. The Kenera team
designed the drilling equipment set and drilling support module of the ACE platform and this
is now in the final stages of construction with operations expected to commence in 2023.

Whilst activity in the North Sea continues to be strong, we were unsuccessful in renewing the
pipe pool management contract in Norway. There are two further contracts coming up for
renewal which should conclude shortly, resulting in extensions.

Kenera
Kenera facilities are busy with the construction of the new build rigs for the PDO project,
however the accounting rules will push revenue recognition in to 2023.

The Kenera team are building upon recent successes for the traditional oil and gas business
in the Middle East both in component sales and after sales. The Saipem acquisition will drive
higher levels of in-house servicing going forward.

We recently signed a technical collaboration and sales agreement with CPH2. This will enable
us to manufacture and supply patented Membrane-Free Electrolyser™ units for hydrogen
production in support of our strategy to expand in clean energy markets. Kenera will be able
to supply hydrogen electrolysers across Europe and will have an exclusive licence across the
Middle East, including important markets such as Saudi Arabia and Oman. We are targeting
to build the first CPH2 electrolyser in Germany during 2023.

Our first Battery Energy Storage Solution (BESS) is already enroute to the Middle East for a
project with a major National Oil Company. This product has the potential to reduce CO2
emissions and operating costs, effectively replacing diesel generators.

Overall as a Group we are making excellent progress with clean energy, whilst also playing
our role in sustainability and energy transition.

Liquidity and Net Financial Debt position

The Group had net cash of $178 million at the end of Q3 versus net cash of $186 million at
the end of Q2. The Q3 balance no longer has any cash held in Russia, whereas in Q2 there
was $18 million. Excluding this Russian cash from the Q2 balance, the group recorded a net
cash inflow of $10 million in the quarter. As a result, the Group finished the quarter with net
debt of $322 million.

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Business Review
Land Drilling
Land Drilling
$m Q3 2022 Q2 2022 Q3 2021 2022 YTD 2021 YTD
Revenue 106 126 128 349 348
EBITDA 27 36 38 96 100
EBITDA Margin 26% 29% 30% 28% 29%

Land Drilling EBITDA in the third quarter of 2022 was lower than the second quarter of 2022
and the equivalent quarter in 2021 mainly driven by the lack of Russian contribution. Results
from our core Middle East market and Europe continued to improve with ongoing rig
reactivations and increasing utilisation.

Offshore Services
Offshore Services
$m Q3 2022 Q2 2022 Q3 2021 2022 YTD 2021 YTD
Revenue 143 150 141 442 419
EBITDA 28 26 26 78 77
EBITDA Margin 20% 17% 18% 18% 18%

Despite the removal of Russia, Offshore Services continued to perform well with higher results
than the prior quarter due to an improvement in a number of categories relating to the recovery
of COVID costs, lower personnel costs, provision releases and mobilisation fee recognition.

Kenera
Kenera
$m Q3 2022 Q2 2022 Q3 2021 2022 YTD 2021 YTD
Revenue (before intercompany eliminations) 24 65 35 144 113
EBITDA (before intercompany eliminations) (1) 7 3 11 7
EBITDA Margin -2% 11% 7% 7% 6%

Kenera achieved lower EBITDA than both Q2 2022 and Q3 2021. This is largely due to the
planned rig sales for 2022 being completed during the first half of the year and a lower number
of top drive sales.

Disclaimer
Please refer to the annual audited financial statements posted on our website for further detail and information on
the Group’s accounting policies and risk factors.
This announcement may include forward-looking statements, which reflect the current views of the company about
future events and financial performance. The use of any of the words "expects," "anticipates," "will," "should,"
"believes," "plans," "intends" and similar expressions are intended to identify forward-looking statements. Although
the company believes that the expectations and assumptions on which such forward-looking statements are based
to be reasonable, undue reliance should not be placed thereon because such statements may prove to be incorrect.
Since forward-looking statements address future events and conditions, by their very nature they involve inherent
risks and uncertainties. The forward-looking statements and information contained in this announcement are made
as of the date hereof and the company does not undertake any obligation to update publicly or revise any forward-
looking statements, whether as a result of new information, future events or otherwise, unless so required by law.

Page 4
Interim Financial
Statements
KCA Deutag Alpha Limited

For the 9 months ended 30 September 2022 .

Page 5
UNAUDITED

Table of contents

Consolidated income statement 7

Consolidated statement of changes in shareholder's equity 8

Consolidated balance sheet 9

Consolidated cash flow statement 11

Notes to the quarterly financial statements 12

1. Significant accounting policies 12

1.1 Compliance with IAS 34 12

1.2 Basis of preparation 12

2. Segment reporting 13

3. Net finance costs 13

4. Exceptional items 14

5. Reconciliation of net debt 14

6. Tangible fixed assets 15

7. Intangible assets 15

8. Trade and other receivables 15

9. Trade and other payables 16

10. Cash generated from operating activities 16

11. Russia update 17

12. Post balance sheet event 18

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UNAUDITED

Consolidated income statement

Q3 2022 Q3 2021 Q3 2022 Q3 2021

YTD YTD
Note $m $m $m $m
Sales 2 923.5 874.1 265.6 300.5
Operating costs (748.8) (702.5) (216.5) (238.4)
EBITDA 2 174.7 171.6 49.1 62.1
Depreciation/Amortisation (92.2) (107.0) (27.5) (35.8)
Operating profit (pre-exceptional) 82.5 64.6 21.6 26.3
Exceptional items, net operating costs 4 (120.4) (6.2) (99.6) (0.7)
Exceptional items, net impairment losses on
other non-current assets 4 (122.1) - (13.6) -
Operating (loss) profit (160.0) 58.4 (91.6) 25.6
Net finance costs 3 (5.1) (43.0) 1.6 (15.2)
Profit (loss) before tax (165.1) 15.4 (90.0) 10.4
Taxation (17.1) (18.6) (0.1) (6.4)
Profit (loss) after tax (182.2) (3.2) (90.1) 4.0
Attributable to the owners of the KCAD Group (192.5) (11.0) (94.3) 1.6
Attributable to non-controlling interests 10.3 7.8 4.2 2.4
(182.2) (3.2) (90.1) 4.0

Included in the Group results above are the following which relates to discontinued operations in Russia:
Q3 2022 Q3 2021 Q3 2022 Q3 2021
YTD YTD
Note $m $m $m $m
Sales 2 184.7 190.5 15.6 58.7
Operating costs (136.9) (138.0) (12.6) (38.2)
EBITDA 2 47.8 52.5 3.0 20.5
Depreciation (10.3) (22.6) (1.0) (7.6)
Operating profit (pre-exceptionals) 37.5 29.9 2.0 12.9
Exceptional items, net operating costs 4 (121.0) - (102.3) -
Exceptional items, net impairment losses on
other non-current assets 4 (122.1) - (13.6) -
Operating profit (loss) (205.6) 29.9 (113.9) 12.9
Finance income 5.8 (0.3) (1.6) (0.3)
Profit (loss) before tax (199.8) 29.6 (115.5) 12.6
Taxation 2.3 (5.9) 7.0 (2.8)
Profit (loss) after tax (197.5) 23.7 (108.5) 9.8

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UNAUDITED

Consolidated statement of changes in shareholder’s equity

Share Share Retained Other Non-
capital premium earnings reserves controlling Total
Interest
$m $m $m $m $m $m

At 1 January 2022 - - 693.9 94.6 11.8 800.3

Comprehensive income (expense)
Profit (loss) for the period - - (192.5) - 10.3 (182.2)
Other comprehensive income
(expense)
Fair value movement on cash flow
- - - (0.7) - (0.7)
hedges
Exchange differences on foreign
- - - (9.1) - (9.1)
operations
Total other comprehensive
- - - (9.8) - (9.8)
income (expense)
Total comprehensive income
- - (192.5) (9.8) 10.3 (192.0)
(expense)
Transactions with owners
Dividend to minority shareholders - - (0.5) - (4.5) (5.0)
At 30 September 2022 - - 500.9 84.8 17.6 603.3

At 31 December 2021 - - 693.9 94.6 11.8 800.3

Other reserves in the Balance Sheet consist of the hedging reserve, merger reserve, currency translation reserve and
non-controlling interests.

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UNAUDITED
Consolidated balance sheet

Q3 2022 Q3 2021 Audited

Q4 2021
Note $m $m $m
ASSETS
Non-current assets
Property, plant and equipment 6 383.5 540.2 521.0
Right of use leased asset 88.6 115.3 112.2
Goodwill 479.8 479.8 479.8
Intangible assets 7 15.0 15.0 15.7
Investments 10.0 - 0.1
Deferred tax assets 65.8 51.2 66.7
1,042.7 1,201.5 1,195.5
Current assets
Inventories and work-in-progress 120.4 155.7 149.1
Trade and other receivables 8 252.1 291.5 288.5
Amounts owed by parent company 5.2 2.7 2.9
Financial assets - derivative financial instruments 2.0 0.2 0.2
Cash at bank 177.5 199.9 218.8
557.2 650.0 659.5
Assets classified as held for sale - - 15.6
Total assets 1,599.9 1,851.5 1,870.6

Liabilities
Current liabilities
Trade and other payables 9 (262.7) (258.2) (283.3)
Tax liabilities (19.7) (20.7) (19.7)
Financial liabilities - derivative financial instruments (0.5) - -
Financial liabilities - borrowings (0.1) - -
Lease liabilities - current (37.2) (39.6) (40.2)
Provisions and other payables (0.6) (0.7) (1.0)
(320.8) (319.2) (344.2)
Non-current liabilities
Deferred income (10.0) (13.3) (10.2)
Financial liabilities - borrowings (494.9) (493.7) (494.0)
Deferred tax liabilities (5.2) (18.2) (12.7)
Retirement benefit obligations (105.2) (141.9) (126.3)
Lease liabilities - non current (58.5) (84.8) (80.9)
Provisions and other non-current liabilities (2.0) (1.9) (2.0)
(675.8) (753.8) (726.1)
Total liabilities (996.6) (1,073.0) (1,070.3)
Net assets 603.3 778.5 800.3

Capital and reserves

Share capital - - -
Other reserves 84.8 99.0 94.6
Retained earnings surplus (deficit) 500.9 664.7 693.9
Total shareholders' surplus (deficit) 585.7 763.7 788.5
Equity non-controlling interest 17.6 14.8 11.8
Total equity 603.3 778.5 800.3

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UNAUDITED
Consolidated balance sheet (continued)

Included within the consolidated balance sheet are the following net assets (liabilities) relating to discontinued
operations:

Q3 2022 Q3 2021 Audited

Q4 2021
$m $m $m

Net assets (liabilities) of discontinued operations (22.7) 92.5 105.3

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UNAUDITED
Consolidated cash flow statement

Q3 2022 Q3 2021 Q3 2022 Q3 2021

YTD YTD
$m $m $m $m
Cash flows from operating activities
Cash generated from operations 10 77.7 117.7 27.0 76.7
Tax paid (24.8) (25.9) (6.5) (4.3)
Net cash in flow from operating activities 52.9 91.8 20.5 72.4

Cash flows from investing activities

Capital expenditure (40.6) (28.6) (15.4) (11.6)
Acquisition of shares in an unconsolidated entity (9.8) - - -
Proceeds from sale of property, plant and equipment 18.0 0.4 0.1 -
Purchase of intangible assets (3.0) (0.6) (2.1) (0.2)
Interest received 0.9 0.1 0.5 0.1
Net cash outflow from investing activities (34.5) (28.7) (16.9) (11.7)

Cash flows from financing activities

Bank loan drawdowns/repayments - (1.0) - (0.5)
Interest paid, including capitalised interest (27.9) (24.5) (0.7) (1.1)
Lease payments (34.9) (34.2) (11.3) (11.7)
Dividend paid to minority shareholders (5.0) (3.7) (4.5) (0.1)
Net cash outflow from financing activities (67.8) (63.4) (16.5) (13.4)

Effect of foreign exchange rate changes on cash

8.1 (1.3) 4.1 (2.1)
and bank overdrafts
Net cash in (out) flow (41.3) (1.6) (8.8) 45.2
Cash and cash equivalents at start of period 218.8 201.5 186.3 154.7
Cash and cash equivalents at end of period 177.5 199.9 177.5 199.9

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UNAUDITED
Notes to the Quarterly Financial Statements

1. Significant Accounting Policies

1.1 COMPLIANCE WITH IAS 34

These condensed quarterly consolidated financial statements have been prepared in accordance with IAS 34, Interim
Financial Reporting. They do not contain all the disclosures required for annual financial statements and should
therefore be read in conjunction with the Group’s annual financial statements for the year ended 31 December 2021,
prepared in accordance with International Financial Reporting Standards (IFRS) in conformity with the requirements of
the Companies Act 2006.

1.2 BASIS OF PREPARATION

1.2.1 General principle

The preparation of these condensed quarterly financial statements requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting
policies. The areas involving a higher degree of judgement, complexity or areas where assumptions and estimates are
significant to the condensed quarterly consolidated financial statements are disclosed in Note 1.2.2.

1.2.2 Accounting estimates and judgements

Accounting estimates and underlying assumptions are based on past experience and other factors considered
reasonable under the circumstances.

They serve as the basis for any judgement required for determining the carrying amounts of assets and liabilities when
such amounts cannot be obtained directly from other sources.

Actual amounts may differ from these estimates.

The main sources of uncertainty relating to estimates used to prepare the interim consolidated financial statements were
the same as those described in the full year 2021 consolidated financial statements.

The sanctions on Russia, arising from the war in Ukraine, continued to have an impact on the carrying value of our
Russian assets (see note 11 for further details). During Q3, this has resulted in the Group deconsolidating its Russian
businesses and classifying them as discontinued operations.

EBITDA, a non-GAAP profit measure, is used as a simple proxy for pre-tax cash flows from operating activities. It is
calculated as operating profit before exceptional items, share of associates’ post-tax results, interest, tax, depreciation,
impairment and amortisation.

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UNAUDITED
2. Segment reporting

Q3 2022 Q3 2021 Q3 2022 Q3 2021

YTD YTD
$m $m $m $m
Revenues
Land Drilling 348.8 348.4 106.0 127.9
Offshore Services 442.2 418.6 143.0 141.3
Kenera 144.0 113.5 23.7 34.5
Corporate costs/other 0.4 0.4 0.1 0.1
Elimination on consolidation (11.9) (6.8) (7.2) (3.3)
Group total 923.5 874.1 265.6 300.5
Discontinued operations 184.7 190.5 15.6 58.7
Continuing operations total 738.8 683.6 250.0 241.8
EBITDA (pre-exceptional)
Land Drilling 96.4 99.8 27.1 38.1
Offshore Services 77.5 76.8 28.2 25.8
Kenera 10.7 7.4 (0.5) 2.6
Corporate costs/other (9.8) (12.2) (5.7) (4.3)
Elimination on consolidation 1 (0.1) (0.2) - (0.1)
Group total 174.7 171.6 49.1 62.1
Discontinued operations 47.8 52.5 3.0 20.5
Continuing operations total 126.9 119.1 52.1 41.6
1Eliminations on consolidation principally relate to sales from Kenera to Land Drilling and to support the Group’s capital expenditure
programme.

3. Net finance costs

Q3 2022 Q3 2021 Q3 2022 Q3 2021

YTD YTD
$m $m $m $m
Interest payable on Senior Secured Notes (37.0) (37.0) (12.2) (12.3)
Finance costs on leases (7.5) (8.4) (2.4) (2.8)
Amortisation of arrangement fees (1.0) (0.9) (0.4) (0.3)
Other finance costs (2.2) (1.7) (0.5) (0.4)
Finance costs (47.7) (48.0) (15.5) (15.8)
Finance income 0.9 0.1 0.5 0.1
Exchange gains (losses) 41.7 4.9 16.6 0.5
Finance costs – net (5.1) (43.0) 1.6 (15.2)

The exchange gain movement in Q3 is driven by the weakening of the EUR, NOK and GBP against the dollar.

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4. Exceptional items

Exceptional items included in operating profit

Q3 2022 Q3 2021 Q3 2022 Q3 2021
YTD YTD
$m $m $m $m
Reorganisation costs 1 (2.5) (5.8) (0.9) (0.5)
Supplier dispute 2 (0.4) (0.4) - (0.2)
IT exceptional costs 3 (1.6) - (0.2) -
Gain (loss) on disposal of Nigeria business and assets4 1.3 - - -
Impairment of Russian current assets5 (121.0) - (102.3) -
Mexico guarantee recovery6 3.8 - 3.8 -
Exceptional operating items (120.4) (6.2) (99.6) (0.7)
Tax effect on exceptional operating items 0.1 0.3 - -
Exceptional operating items, net of tax (120.3) (5.9) (99.6) (0.7)

1 Reorganisation costs primarily relate to the Group’s cost reduction, restructuring, redundancy expenditure and COVID-19
expenditure along with professional fees associated with the Group’s strategic activities looking at potential mergers and acquisitions.
2 In 2022 the Group has booked an additional charge of $0.4 million (2022: $0.4 million) in Kenera relating to a dispute with suppliers,
together with certain other related costs.
3In 2022 a cost of $1.6 million was recorded in respect of costs involved in responding to a cyber-attack which restricted access to a
number of the Group's back-office systems. These were predominantly costs involved in the restoration of system access.
4 On 30 December 2021 the Group entered into an agreement with Geoplex Drillteq Limited to sell several rigs and associated
inventory in Nigeria with the intention to exit the Nigerian land drilling business. Approval was granted by the Nigerian authorities in
March 2022 with $1.3 million representing the gain on the sale.
5 During Q3 2022, the Group has recorded provisions against Russian working capital balances of $102.3 million. See Note 11.
6In August 2022, the Group recovered $3.8 million of funds in Mexico which had previously been consigned with a third party under a
performance security, following the expiry of a time limit applicable to any client claim against those funds.

Impairment gains (charges) in respect of Russian operations

Q3 2022 Q3 2021 Q3 2022 Q3 2021
YTD YTD
$m $m $m $m
Exceptional items, net impairment gains
(losses) on other non-current assets (note 11) (122.1) - (13.6) -
Exceptional operating items (122.1) - (13.6) -

5. Reconciliation of net debt

Q3 2022 Q3 2021 Q3 2022 Q3 2021 Audited

YTD YTD Q4 2021
$m $m $m $m $m
Opening net debt per balance sheet (281.2) (292.2) (308.3) (338.7) (292.2)
Net cash in (out) flow (41.3) (1.6) (8.8) 45.2 17.3
Repayment (drawdown) of debt - 1.0 - 0.5 0.9
Other non-cash movements 5.1 (1.0) (0.3) (0.8) (1.2)
Closing net debt per balance sheet (317.4) (293.8) (317.4) (293.8) (275.2)
Capitalised arrangement fees (5.1) (6.3) (5.1) (6.3) (6.0)
Closing net debt (322.5) (300.1) (322.5) (300.1) (281.2)

KCA Deutag Alpha Limited, their affiliates or other related parties may or may not opportunistically purchase debt in one
or more series of open-market transactions from time to time.

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UNAUDITED
6. Tangible fixed assets

Land and Drilling rigs and Plant, machinery Total Tangible

buildings equipment and vehicles fixed
freehold assets

$m $m $m $m
Cost
At 1 January 2022 34.6 1,720.3 96.0 1,850.9
Additions at cost - 43.7 0.6 44.3
Disposals (6.5) (494.6) (0.9) (502.0)
Exchange adjustments (1.3) 0.4 (13.6) (14.5)
At 30 September 2022 26.8 1,269.8 82.1 1,378.7

Accumulated depreciation
At 1 January 2022 10.1 1,303.6 16.2 1,329.9
Charge for the period 0.7 59.3 1.5 61.5
Disposals (6.5) (494.6) (0.9) (502.0)
Impairment (note 11) 6.4 114.8 0.8 122.0
Exchange adjustments (0.4) (2.7) (13.1) (16.2)
At 30 September 2022 10.3 980.4 4.5 995.2

Net carrying amount

At 30 September 2022 16.5 289.4 77.6 383.5

Net carrying amount

At 31 December 2021 24.5 416.7 79.8 521.0

7. Intangible assets

Customer
relationships
and contracts Trade name Technology Total
$m $m $m $m
Cost
At 1 January 2022 254.4 176.3 48.9 479.6
Additions - - 3.0 3.0
Exchange - - (5.8) (5.8)
At 30 September 2022 254.4 176.3 46.1 476.8

Accumulated amortisation
At 1 January 2022 254.4 167.1 42.4 463.9
Charge for the period - 1.1 1.6 2.7
Impairment (note 11) - - 0.1 0.1
Exchange - - (4.9) (4.9)
At 30 September 2022 254.4 168.2 39.2 461.8

Net carrying amount

At 30 September 2022 - 8.1 6.9 15.0

Net carrying amount

At 31 December 2021 - 9.2 6.5 15.7

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8. Trade and other receivables

Q3 2022 Q3 2021 Audited

Q4 2021
$m $m $m
Trade receivables 194.6 239.2 239.4
Other receivables 17.3 16.0 16.6
Prepayments and accrued income 21.1 11.8 12.6
Contract assets 19.1 24.5 19.9
Total 252.1 291.5 288.5

9. Trade and other payables

Q3 2022 Q3 2021 Audited

Q4 2021
$m $m $m
Trade payables 70.4 51.7 56.9
Other tax and social security 13.7 12.8 19.7
Other payables 12.7 24.6 28.5
Accruals 139.0 139.3 148.0
Payments received on account 0.2 - 3.5
Deferred income 26.7 29.8 26.7
Total 262.7 258.2 283.3

10. Cash generated from operating activities

Q3 2022 Q3 2021 Q3 2022 Q3 2021

YTD YTD
$m $m $m $m
Profit (loss) for the period (182.2) (3.2) (90.1) 4.0
Adjustments for:
Tax charge 17.1 18.6 0.1 6.4
Depreciation1 89.5 104.4 26.6 35.0
Amortisation of intangible assets 2.7 2.6 0.9 0.8
Net impairment losses of other non-current assets 122.1 - 13.6 -
Loss (gain) on sale of property, plant and equipment (1.3) 0.1 (0.1) 0.1
Net movement in provisions, other liabilities and retirement
(8.3) (6.4) (4.2) (2.1)
benefit obligations
Net finance cost 5.1 43.0 (1.6) 15.2
(Increase) decrease in inventories and work in progress 28.6 (15.8) 31.0 (2.5)
(Increase) decrease in trade and other receivables 30.2 (46.3) 76.7 2.2
Increase (decrease) in trade and other payables (34.3) 19.2 (22.8) 17.9
Exchange differences from operating activities 8.5 1.5 (3.1) (0.3)
Cash generated from operating activities 77.7 117.7 27.0 76.7

1 YTD depreciation includes $28.0m (Q3 2021 YTD $28.1m) of depreciation for right of use assets.
As the Q3 2022 and Q3 2022 YTD cash generated from operating activities has been significantly impacted by
non-cash impairments arising from the derecognition of the Russian business, we have included a table below showing
these adjustments and the resulting operating cash movements excluding Russia derecognition.

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10. Cash generated from operating activities (continued)

Impact of Russia Derecognition

Total Total
Russia Excluding Russia Excluding
Total Derecognition Derecognition Total Derecognition Derecognition
Q3 2022 Q3 2022 Q3 2022 Q3 2022 Q3 2022 Q3 2022
YTD YTD YTD
$m $m $m $m $m $m
Profit (loss) for the period (182.2) (197.5) 15.3 (90.1) (108.5) 18.4
Adjustments for:
Tax charge 17.1 (2.3) 19.4 0.1 (7.0) 7.1
Depreciation1 89.5 10.3 79.2 26.6 1.0 25.6
Amortisation of intangible
2.7 - 2.7 0.9 - 0.9
assets
Net impairment losses of
122.1 122.1 - 13.6 13.6 -
other non-current assets
Loss (gain) on sale of
property, plant and (1.3) - (1.3) (0.1) - (0.1)
equipment
Net movement in
provisions, other liabilities
(8.3) - (8.3) (4.2) - (4.2)
and retirement benefit
obligations
Net finance cost 5.1 (5.8) 10.9 (1.6) (1.6) -
(Increase) decrease in
inventories and work in 28.6 51.9 (23.3) 31.0 36.5 (5.5)
progress
(Increase) decrease in trade
30.2 59.0 (28.8) 76.7 59.0 17.7
and other receivables
Increase (decrease) in trade
(34.3) 0.1 (34.4) (22.8) 0.1 (22.9)
and other payables
Exchange differences from
8.5 8.0 0.5 (3.1) 8.0 (11.1)
operating activities
Cash generated from
77.7 45.8 31.9 27.0 1.1 25.9
operating activities

11. Russia Update

On 21 July, further packages of sanctions were put in place by the UK and European Union which resulted in the Group
having to isolate the remainder of its Russian business from the rest of the KCA Deutag Group. The Group removed UK
nationals or UK residents from the Sakhalin operations and accelerated the abandonment of its remaining land rigs and
activities that are managed by the Land Russia business as previously disclosed. Our Russian businesses ceased to
have access to KCA Deutag Group systems and support from Group management.
During October 2022, we received notification that a Russian Court had, in August 2022, transferred title to the rigs
abandoned in May 2022 away from the KCA Deutag rig owning entities. Therefore, the Group has ceased to recognise
these assets on its Balance Sheet as they have effectively now been disposed. Also, based on information that the
Russian Courts are expected soon to transfer title from KCA Deutag subsidiaries of the remaining Russian based Land
Drilling Rigs, these assets have also been derecognised at the end of Q3.
The Group continued to recognise revenue and costs up until 20 July in respect of its Offshore and Kenera businesses
as well as in relation to those rigs and activities of the Land business which had not previously been abandoned.
Subsequently, the Group has ceased to consolidate any of its Russian subsidiaries during Q3. Across our Russian
businesses prior to derecognition, the Group generated revenue and EBITDA of $184.6 million and $47.8 million
respectively during 2022.
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11. Russia Update (continued)

Russia Balance Sheet information at 30 September 2022

Q3
Net Book Q3 Impairment Total at
Value at movements Provision 30 September
30 June 2022 inc exchange (Note 4) 2022
$m $m $m $m
Property, Plant & Equipment 14.5 (0.9) (13.6) -
Investments 0.2 - - 0.2
Non-current assets 14.7 (0.9) (13.6) 0.2

Intercompany payables (40.2) 17.5 - (22.7)

Intercompany receivables 28.9 (16.6) (12.3) -
Intercompany (net) (11.3) 0.9 (12.3) (22.7)

Net working capital (excl. intercompany) 76.3 (3.3) (73.0) -

Cash 17.7 (0.7) (17.0) -
Tax and deferred tax (8.9) 11.0 (2.1) -
Net assets 88.5 7.0 (118.0) (22.5)

During the third quarter, impairment charges of $13.6 million in relation to PP&E and $102.3 million in relation to current
assets, comprising working capital balances ($73.0 million), intercompany receivables ($12.3 million) and cash balances
($17.0 million) were recorded as a result of deconsolidating our Russian entities during Q3. An adjustment of $2.1
million to write off remaining Russian corporate tax balances was also recorded.
The Group continued to receive cash from its Russian operations by way of settling intercompany receivables. During
Q3, $25.4 million was repatriated from the Russian businesses relating to compliant activity completed before the
sanctions were implemented.
We continue to carry accrual balances of $22.7 million in respect of amounts which may require to be paid by the Group
in the future.

12. Post Balance Sheet Event

Saipem Acquisition
On 28 October 2022, the Group completed the acquisition of the largest elements of the previously announced
transaction to purchase the onshore drilling business of Saipem SpA (“Saipem Onshore Drilling”). This first phase
encompasses Saudi Arabia, UAE and Africa, with Kuwait expected to follow later in Q4 2022 and the remaining country
businesses in 2023.

The total consideration payable for Saipem Onshore Drilling is $550 million in cash and a 10% equity interest in the
Group, with $85 million of cash consideration withheld pending completion of the remaining closings. Initial
consideration of $465 million was paid on 28 October 2022 using funds drawn down from previously committed
acquisition finance facilities including Floating Rate Notes, PIK Notes and Revolving Credit Facilities. The PIK Notes
have been issued by a parent company and loaned down into the KCA Deutag Alpha Group during October 2022.

Once the acquisition is fully completed the combined Group will manage a leading global onshore drilling business
generating over 50% of its EBITDA from the Middle East with more than 11,000 employees globally.
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