Equity Method Investment In ARO (Tables)

3 Months Ended

6 Months Ended

Jun. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

A reconciliation of those components is presented below (in millions):


	Successor		Predecessor
	Two Months Ended June 30, 2021		One Month Ended April 30, 2021		Three Months Ended June 30, 2020
50% interest in ARO net income	$	2.3	$	1.9	$	3.3
Amortization of basis differences	2.5		(.7)		(8.5)
Equity in earnings (losses) of ARO	$	4.8	$	1.2	$	(5.2)


	Successor		Predecessor
	Two Months Ended June 30, 2021		Four Months Ended April 30, 2021		Six Months Ended June 30, 2020
50% interest in ARO net income	$	2.3	$	6.0	$	4.9
Amortization of basis differences	2.5		(2.9)		(16.4)
Equity in earnings (losses) of ARO	$	4.8	$	3.1	$	(11.5)

Summarized financial information for ARO is as follows (in millions):


	Three Months Ended				Six Months Ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
Revenues	$	124.8	$	146.0	$	247.5	$	286.3
Operating expenses
Contract drilling (exclusive of depreciation)	92.7		112.5		179.0		220.8
Depreciation	14.6		13.3		30.7		26.3
General and administrative	4.3		7.1		7.3		15.4
Operating income	13.2		13.1		30.5		23.8
Other expense, net	3.1		6.7		7.6		13.3
Provision (Benefit) for income taxes	1.9		(.2)		6.4		.7
Net income	$	8.2	$	6.6	$	16.5	$	9.8


	June 30, 2021		December 31, 2020
Cash and cash equivalents	$	318.2	$	237.7
Other current assets	81.7		120.9
Non-current assets	782.8		804.0
Total assets	$	1,182.7	$	1,162.6

Current liabilities	$	74.9	$	70.8
Non-current liabilities	950.3		950.8
Total liabilities	$	1,025.2	$	1,021.6

The following table summarizes the total assets and liabilities as reflected in our Condensed Consolidated Balance Sheets as well as our maximum exposure to loss related to ARO (in millions). Our maximum exposure to loss is limited to (1) our equity investment in ARO; (2) the outstanding balance on our shareholder notes receivable; and (3) other receivables and contract assets related to services provided to ARO, partially offset by contract liabilities as well as payables for services received. Contract liabilities related to our Lease Agreements are subject to adjustment during the lease term. The per day bareboat charter amount in the Lease Agreements is subject to adjustment based on actual performance of the respective rig.


	Successor		Predecessor
	June 30, 2021		December 31, 2020
Total assets	$	340.7	$	585.2
Less: total liabilities	38.6		30.9
Maximum exposure to loss	$	302.1	$	554.3

Schedule of Related Party Transactions

Revenues recognized by us related to the Lease Agreements, Transition Services Agreement and Secondment Agreement are as follows (in millions):


	Successor		Predecessor
	Two Months Ended June 30, 2021		One Month Ended April 30, 2021		Three Months Ended June 30, 2020
Lease revenue	$	10.3	$	5.1	$	19.9
Secondment revenue	.4		.3		.2
Total revenue from ARO (1)	$	10.7	$	5.4	$	20.1


	Successor		Predecessor
	Two Months Ended June 30, 2021		Four Months Ended April 30, 2021		Six Months Ended June 30, 2020
Lease revenue	$	10.3	$	21.7	$	41.4
Secondment and Transition Services revenue	.4		1.1		22.0
Total revenue from ARO (1)	$	10.7	$	22.8	$	63.4

(1) All of the revenues presented above are included in our Other segment in our segment disclosures. See "Note 15 - Segment Information" for additional information.