Valaris Ltd, the Bermudian-based offshore drilling services company, has parlayed a tax benefit of $790 million into fourth-quarter net income of $829 million.

That result compares with net income of $17 million in the third quarter of the year.

Of its fourth-quarter results, Valaris said: “Tax benefit was $790 million compared to tax expense of $11 million in the third quarter 2023. The fourth-quarter tax provision included $800 million of tax benefit due to changes in deferred tax asset valuation allowances.”

Fourth-quarter revenues increased to $484 million from $455 million in the third quarter. Excluding reimbursable items, revenues increased to $453 million from $427 million.

Valaris said the increase was primarily due to more operating days across the fleet, including for drill ship Valaris DS-17 that commenced a contract in early September, following its reactivation, and jack-up Valaris 107, which started a contract early in the fourth quarter after being idle for most of the third quarter.

President and chief executive Anton Dibowitz said: “We continue to execute on our operating leverage by repricing rigs from legacy day rates to meaningfully higher market rates and successfully delivering reactivated rigs with attractive contracts.

“At the same time, we remain laser focused on delivering high levels of operational performance to our customers, as evidenced by another strong year of revenue efficiency.

“During the fourth quarter, we were awarded new contracts and extensions with associated contract backlog of more than $1.4 billion. These awards include two multiyear drill ship contracts at leading-edge day rates and several jack-up contracts across the North Sea, Australia and Trinidad, demonstrating the depth of our customer relationships, track record of operational delivery and broad-based strength of the market.”

Mr Dibowitz added: “We remain confident in the strength and duration of this upcycle and the outlook for Valaris is positive.

“We expect to deliver significant earnings and cashflow growth over the next few years and we intend to return all future free cashflow to shareholders unless there is a better or more value-accretive use for it.”