Discontinued Operations

During the three-month period ended June 30, 2014, management committed to a plan to sell five floaters. The ENSCO 5000, ENSCO 5001, ENSCO 5002, ENSCO 6000 and ENSCO 7500 were removed from our portfolio of rigs marketed for contract drilling services and are being actively marketed for sale. These rigs were classified as "held for sale" as of June 30, 2014 and written down to fair value less costs to sell.

We recorded a non-cash loss on impairment totaling $508.8 million, net of tax benefits of $37.6 million, during the three-month period ended June 30, 2014. The impairment charge was included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014. The operating results from these rigs were included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014 and 2013.

In connection with the sale of the ENSCO 7500, we will be required to pay the outstanding principal on the 6.36% MARAD bonds due 2015, which are collateralized by this rig. The outstanding principal balance on this bond is $19.0 million as of June 30, 2014, of which $12.7 million is included in current maturities of long term debt in the condensed consolidated balance sheet as of June 30, 2014.

During the three-month period ended June 30, 2014, we sold jackup rig ENSCO 85 for net proceeds of $64.4 million. The rig was classified as held for sale as of March 31, 2014. The proceeds from the sale were included in investing activities of discontinued operations in our condensed consolidated statement of cash flows for the six-month period ended June 30, 2014. We recognized a gain of $2.3 million in connection with the disposal, which was included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014. ENSCO 85 operating results were included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014 and 2013.

During the six-month period ended June 30, 2014, we sold jackup rigs ENSCO 69 and Wisconsin for net proceeds of $32.2 million. These rigs were classified as held for sale as of December 31, 2013. The proceeds from the sale were received in December 2013 and included in net cash used in investing activities of continuing operations in our consolidated statement of cash flows for the year ended December 31, 2013 in our annual report on Form 10-K for the year ended December 31, 2013. During the three-month period ended June 30, 2014, in connection with the potential sale of multiple rigs in our fleet mentioned above, ENSCO 69 and Wisconsin operating results were reclassified to (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014 and 2013. We recognized a gain of $17.9 million in connection with the disposal, which was also reclassified to (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month periods ended June 30, 2014.

During the six-month period ended June 30, 2013, we sold jackup rig Pride Pennsylvania for net proceeds of $15.5 million. The rig was classified as held for sale and included in discontinued operations during 2012 in connection with the sale of multiple rigs in our fleet. The proceeds from the sale were included in investing activities of discontinued operations in our condensed consolidated statement of cash flows for the six-month period ended June 30, 2013. We recognized a loss of $1.1 million in connection with the disposal, which was included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the six-month period ended June 30, 2013. Pride Pennsylvania operating results were included in (loss) income from discontinued operations, net in our condensed consolidated statement of operations for the three-month and six-month period ended June 30, 2013.

The following table summarizes (loss) income from discontinued operations, net for the three-month and six-month periods ended June 30, 2014 and 2013 (in millions):



	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Revenues	$	32.7		$	117.8		$	89.8		$	227.5
Operating expenses	74.2			100.5			170.4			202.8
Operating (loss) income	(41.5		)	17.3			(80.6		)	24.7
Other income	—			—			—			.3
Income tax expense	(1.1		)	(1.1		)	(2.7		)	(2.0		)
Loss on impairment, net	(508.8		)	—			(508.8		)	—
Gain (loss) on disposal of discontinued operations, net	.7			—			20.1			(1.1		)
(Loss) income from discontinued operations, net	$	(550.7	)	$	16.2		$	(572.0	)	$	21.9

Debt and interest expense are not allocated to our discontinued operations.

The following table summarizes the major classes of assets held for sale included in other current assets on our condensed consolidated balance sheet as of June 30, 2014 (in millions):



Property and equipment, net	288.5
Other assets	2.3
Assets held for sale	$	290.8