THE Todco

HOUSTON, Nov. 2 /PRNewswire-FirstCall/ -- TODCO (the "Company") (NYSE:THE) today reported net income for the three months ended September 30, 2006, of $55.5 million, or $0.92 per diluted share, on revenues of $242.3 million compared to net income of $19.1 million, or $0.31 per share, on revenues of $141.4 million for the same quarter of 2005. The third quarter of 2006 included $13.0 million (or $0.13 per diluted share, after tax) of rig reactivation expense versus only $6.9 million (or $0.07 per diluted share, after tax) of rig reactivation expenses during the third quarter of 2005. For the three months ended September 30, 2006, earnings before interest, taxes, depreciation and amortization ("EBITDA") was $109.7 million compared to $55.5 million for the same quarter of 2005. The improvement in third quarter 2006 results over the same quarter last year was principally caused by improved utilizations and dayrates which will be discussed during TODCO's publicly accessible third quarter conference call. The conference call will be at 8:00 a.m. (CST), Thursday, November 2, 2006. The conference call can be heard live on the Company's web site at http://www.theoffshoredrillingcompany.com/ or by dialing (800) 374-0113 or (706) 758-9607. A replay of the call will be available for approximately 30 days on the Company's web site or by dialing (800) 642-1687 or (706) 645-9291, reference code 7223910#. TODCO is a leading provider of contract oil and gas drilling services with the largest rig fleet in the shallow water of the U.S. Gulf of Mexico and along the U.S. Gulf Coast. TODCO's common stock is traded on the New York Stock Exchange under the symbol "THE". For more information about TODCO, please go to the Company's web site at http://www.theoffshoredrillingcompany.com/ . TODCO AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In millions, except share data) September 30, December 31, 2006 2005 (Unaudited) ASSETS Cash and cash equivalents $ 137.9 $163.0 Accounts receivable Trade 187.8 107.4 Related party 9.8 9.9 Other 28.0 9.8 Supplies 5.0 4.9 Deferred income taxes 8.9 8.4 Other current assets 3.5 4.3 Total current assets 380.9 307.7 Property and equipment 952.6 919.7 Less accumulated depreciation 497.9 436.7 Property and equipment, net 454.7 483.0 Other assets 24.9 34.3 Total assets $860.5 $825.0 LIABILITIES AND STOCKHOLDERS' EQUITY Trade accounts payable $69.4 $42.4 Accrued income taxes 20.2 10.9 Accrued income taxes - related party 88.9 44.9 Debt due within one year 2.2 0.4 Debt due within one year - related party --- 2.9 Interest payable - related party --- 0.1 Other current liabilities 64.0 63.0 Total current liabilities 244.7 164.6 Long-term debt 16.5 16.6 Deferred income taxes 121.7 144.8 Other long-term liabilities 1.4 3.5 Total long-term liabilities 139.6 164.9 Commitments and contingencies Preferred Stock, $0.01 par value, 50,000,000 shares authorized and no shares issued and outstanding --- --- Common stock, $0.01 par value, 500,000,000 shares authorized, 57,711,477 shares and 61,521,990 shares issued and outstanding at September 30, 2006 and December 31, 2005, respectively 0.6 0.6 Common stock, Class B, $0.01 par value, no shares authorized at September 30, 2006, and 260,000,000 shares authorized and no shares issued and outstanding at December 31, 2005 --- --- Additional paid-in capital 6,385.4 6,527.2 Retained deficit (5,909.8) (6,029.3) Unearned compensation --- (3.0) Total stockholders' equity 476.2 495.5 Total liabilities and stockholders' equity $860.5 $825.0 Total shares, issued and outstanding 57,711,477 61,521,990 TODCO AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In millions, except share data) Three Months Ended Nine Months Ended September 30, September 30, 2006 2005 2006 2005 (In millions, except per share amounts) Operating revenues $242.3 $141.4 $652.0 $383.8 Costs and expenses Operating and maintenance 129.2 77.8 377.1 233.2 Depreciation 20.9 24.1 65.1 72.0 General and administrative 10.8 9.9 31.2 28.2 Impairment loss on long-lived assets --- --- 0.4 --- Gain on disposal of assets, net (6.7) (1.6) (9.0) (8.3) 154.2 110.2 464.8 325.1 Operating income 88.1 31.2 187.2 58.7 Other income (expense), net Interest income 2.6 0.9 7.4 2.2 Interest expense (0.8) (0.8) (2.2) (2.7) Interest expense- related party --- (0.1) --- (0.2) Other, net 0.7 0.2 0.6 1.7 2.5 0.2 5.8 1.0 Income before income taxes and cumulative effect of change in accounting principle 90.6 31.4 193.0 59.7 Income tax expense 35.1 12.3 73.6 21.5 Income before cumulative effect of change in accounting principle 55.5 19.1 119.4 38.2 Cumulative effect of change in accounting principle, net of tax --- --- 0.1 --- Net income $55.5 $19.1 $119.5 $38.2 Net income per common share: Basic: Income before cumulative effect of change in accounting principle $0.93 $0.31 $1.96 $0.63 Cumulative effect of change in accounting principle --- --- --- --- Net income per common share $0.93 $0.31 $1.96 $0.63 Diluted: Income before cumulative effect of change in accounting principle $0.92 $0.31 $1.95 $0.63 Cumulative effect of change in accounting principle --- --- --- --- Net income per common share $0.92 $0.31 $1.95 $0.63 Weighted average common shares outstanding: Basic 59.8 60.9 60.9 60.4 Diluted 60.2 61.6 61.4 61.2 Cash dividend per common share: $--- $1.00 $--- $1.00 TODCO AND SUBSIDIARIES SELECTED SEGMENT AND OPERATING DATA (In millions, except daily amounts) (Unaudited) Three Months Ended September 30, June 30, September 30, 2006 2006 2005 U.S. Gulf of Mexico Segment Operating days 1,083 1,013 1,177 Available days 1,932 1,911 2,086 Utilization 56% 53% 56% Average rig revenue per day $104,100 $104,100 $56,700 Operating revenues $112.7 $105.5 $66.7 Operating and maintenance expenses 62.5 65.4 25.2 Depreciation 8.4 10.5 12.6 Operating income $41.8 $29.6 $28.9 U.S. Inland Barge Segment Operating days 1,543 1,509 1,316 Available days 2,484 2,457 2,484 Utilization 62% 61% 53% Average rig revenue per day $42,900 $37,200 $29,600 Operating revenues $66.2 $56.2 $38.9 Operating and maintenance expenses 30.1 33.4 21.3 Depreciation 6.1 5.2 6.0 Gain on disposal of assets, net (2.5) (1.2) (1.3) Operating income $32.5 $18.8 $12.9 International and Other Segment Operating days 1,033 1,030 738 Available days 1,472 1,456 1,318 Utilization 70% 71% 56% Average rig revenue per day $42,100 $43,200 $31,300 Operating revenues $43.5 $44.5 $23.1 Operating and maintenance expenses 28.6 33.4 24.0 Depreciation 5.4 5.2 4.4 Impairment loss on long-level assets --- 0.4 --- Gain on disposal of assets, net (0.3) --- --- Operating income (loss) $9.8 $5.5 $(5.3) Delta Towing Segment Operating revenues $19.9 $19.9 $12.7 Operating and maintenance expenses 8.0 8.4 7.3 Depreciation 1.0 1.0 1.1 General and administrative expenses 1.3 1.1 1.1 Gain on disposal of assets, net (3.9) (0.2) (0.3) Operating income $13.5 $9.6 $3.5 Total Company Rig operating days 3,659 3,552 3,231 Rig available days 5,888 5,824 5,888 Rig utilization 62% 61% 55% Operating revenues $242.3 $226.1 $141.4 Operating and maintenance expenses 129.2 140.6 77.8 Depreciation 20.9 21.9 24.1 General and administrative expenses 10.8 10.7 9.9 Impairment loss on long-level assets --- 0.4 --- Gain on disposal of assets, net (6.7) (1.4) (1.6) Operating income $88.1 $53.9 $31.2 TODCO AND SUBSIDIARIES NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (In millions) (Unaudited) For the Three Months Ended September 30, June 30, September 30, 2006 2006 2005 Net income to EBITDA Net income $55.5 $34.7 $19.1 Adjustments: Depreciation 20.9 21.9 24.1 Income tax expense 35.1 20.9 12.3 Interest income (2.6) (2.7) (0.9) Interest expense 0.8 0.7 0.9 EBITDA $109.7 $75.5 $55.5 DATASOURCE: TODCO CONTACT: Dale Wilhelm, Vice President & CFO of TODCO, +1-713-278-6014 Web site: http://www.theoffshoredrillingcompany.com/

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