Valaris
VAL
#2540
Rank
NZ$11.24 B
Marketcap
NZ$162.40
Share price
3.18%
Change (1 day)
132.85%
Change (1 year)

Valaris - 10-Q quarterly report FY


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<H1 ALIGN=CENTER><FONT SIZE=3>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</FONT><BR>
<FONT SIZE=1><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Washington, D.C. 20549&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;</U></FONT></H1>

<H1 ALIGN=CENTER><FONT SIZE=5>FORM 10-Q</FONT></H1>
<BR>
<P><FONT SIZE=2>(Mark One)</FONT></P>
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<TD WIDTH=3% ALIGN=LEFT><U>&nbsp;X&nbsp;</U></TD>
<TD WIDTH=2%>&nbsp;</TD>
<TD WIDTH=95% ALIGN=LEFT>QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECURITIES EXCHANGE ACT OF 1934<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>For the quarterly period ended March 31, 2000</U></B><TD>
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<BR>
<P ALIGN=CENTER>OR</P></TD>
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<TD WIDTH=3% ALIGN=LEFT><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
<TD WIDTH=2%>&nbsp;</TD>
<TD WIDTH=95% ALIGN=LEFT>TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECURITIES EXCHANGE ACT OF 1934<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE=2>For the transition period from<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>to<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT><TD>
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<P ALIGN=CENTER><FONT SIZE=2>Commission File Number 1-8097</FONT></P></TD>
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<P ALIGN=CENTER><FONT SIZE=6><B>ENSCO International Incorporated</B></FONT><BR>
<FONT SIZE=2>(Exact name of registrant as specified in its charter)</FONT><P></TD>
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<TD WIDTH=50% ALIGN=CENTER><B>DELAWARE</B><BR>
<FONT SIZE=2>(State or other jurisdiction of<BR>
incorporation or organization)<BR><BR>
<B>2700 Fountain Place<BR>
1445 Ross Avenue<BR>
Dallas, Texas</B><BR>
(Address of principal executive offices)</FONT></TD>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=50% ALIGN=CENTER><B>76-0232579</B><BR>
<FONT SIZE=2>(I.R.S. Employer<BR>
Identification No.)<BR><BR><BR><BR>
<B>75202-2792</B><BR>
(Zip Code)</FONT><TD>
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<P ALIGN=CENTER><FONT SIZE=2>Registrant's telephone number, including area code: <B>(214) 922-1500</B></FONT></P>
<BR>
<P>Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yes<U>&nbsp;&nbsp;X&nbsp;&nbsp;</U>&nbsp;&nbsp;No <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></P>

<P>There were 137,887,865 shares of Common Stock, $.10 par value, of the registrant outstanding as of
May 4, 2000.</P>

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<H1 ALIGN=CENTER><FONT SIZE=3>ENSCO INTERNATIONAL INCORPORATED</FONT></H1>

<H1 ALIGN=CENTER><FONT SIZE=3>INDEX TO FORM 10-Q</FONT></H1>

<H1 ALIGN=CENTER><FONT SIZE=3>FOR THE QUARTER ENDED MARCH 31, 2000</FONT></H1>

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<TD WIDTH=92% ALIGN=LEFT><FONT SIZE=-1><B>PART I</B>&nbsp;&nbsp;&nbsp;FINANCIAL INFORMATION</FONT></TD></TR>


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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ITEM 1.&nbsp;&nbsp;FINANCIAL STATEMENTS</FONT></TD>
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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<A HREF="#A">Review Report of Independent Accountants</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>3</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<A HREF="#B">Consolidated Statement of Income</A><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<A HREF="#B">Three Months
Ended March 31, 2000 and 1999</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>4</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<A HREF="#C">Consolidated Balance Sheet</A><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<A HREF="#C">March 31, 2000 and December 31, 1999</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>5</FONT></TD>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<A HREF="#D">Consolidated Statement of Cash Flows</A><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<A HREF="#D">Three Months Ended March 31, 2000 and 1999</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>6</FONT></TD>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<A HREF="#E">Notes to Consolidated Financial Statements</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>7</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ITEM 2.&nbsp;
&nbsp;<A HREF="#G">MANAGEMENT'S DISCUSSION AND ANALYSIS OF</A><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<A HREF="#G">FINANCIAL CONDITION AND
RESULTS OF OPERATIONS</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>9</FONT></TD>
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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ITEM 3.&nbsp;&nbsp;<A HREF="#H">QUANTITATIVE AND QUALITATIVE DISCLOSURES</A><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<A HREF="#H">ABOUT MARKET RISK</A></FONT></TD>
<TD ALIGN=RIGHT><FONT SIZE=-1>17</FONT></TD>
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<TD WIDTH=92% ALIGN=LEFT><FONT SIZE=-1><B>PART II</B>&nbsp;&nbsp;&nbsp;OTHER INFORMATION</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ITEM 6.&nbsp;&nbsp;<A HREF="#I">EXHIBITS AND REPORTS ON FORM 8-K</A></FONT></TD>

<TD ALIGN=RIGHT><FONT SIZE=-1>18</FONT></TD>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;</FONT></TD></TR>

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<TD ALIGN=LEFT><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<A HREF="#J">SIGNATURES</A></FONT></TD>

<TD ALIGN=RIGHT><FONT SIZE=-1>19</FONT></TD>

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<H1 ALIGN=CENTER><FONT SIZE=3>PART I - FINANCIAL INFORMATION</FONT></H1>

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<A NAME="A"></A>

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<P ALIGN=LEFT><B>Item 1.&nbsp;&nbsp;<I>Financial Statements</I></B></P>
<BR>

<P ALIGN=CENTER><B><U>REVIEW REPORT OF INDEPENDENT ACCOUNTANTS</U></B></P>

<P ALIGN=LEFT>To the Board of Directors and Stockholders<BR>
of ENSCO International Incorporated</P>

<P ALIGN=LEFT>We have reviewed the accompanying consolidated balance sheet of
ENSCO International Incorporated and its subsidiaries as of March 31, 2000
and the related consolidated statements of income and of cash flows for each of the
three month periods ended March 31, 2000 and 1999. These financial statements
are the responsibility of the Company's management.</P>

<P ALIGN=LEFT>We conducted our reviews in accordance with standards established
by the American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.</P>

<P ALIGN=LEFT>Based on our review, we are not aware of any material
modifications that should be made to the accompanying consolidated interim financial
statements for them to be in conformity with accounting principles generally accepted
in the United States.</P>

<P ALIGN=LEFT>We previously audited in accordance with auditing standards generally accepted
in the United States, the consolidated balance sheet as of December 31, 1999, and
the related consolidated statements of income and of cash flows for the year
then ended (not presented herein), and in our report dated January 24, 2000, except as to
Note 12, which is as of February 14, 2000, we
expressed an unqualified opinion on those consolidated financial statements. In
our opinion, the information set forth in the accompanying consolidated balance
sheet information as of December 31, 1999, is fairly stated in all material
respects in relation to the consolidated balance sheet from which it has been
derived.</P>

<P ALIGN=LEFT>/s/ PricewaterhouseCoopers LLP</P>

<P ALIGN=LEFT>Dallas, Texas<BR>
May 5, 2000<BR></P>
<BR><BR><BR>
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<H1 ALIGN=CENTER><FONT SIZE=3><B>ENSCO INTERNATIONAL INCORPORATED AND SUBSIDIARIES</B><BR>
CONSOLIDATED STATEMENT OF INCOME<BR></FONT>
<FONT SIZE=-1><B>(In millions, except per share amounts)<BR>
(Unaudited)</B></FONT></H1>

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<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="4"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;<B>Three Months Ended</B></FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="4"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;March 31,
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></B></FONT></TH>
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<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;1999&nbsp;</U></B></FONT></TH>
</TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="65%" ALIGN="LEFT"><FONT SIZE="-1">OPERATING REVENUES</FONT></TD>
<TD WIDTH="3%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;96</FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1">$127</FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">OPERATING EXPENSES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Operating costs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">63</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">67</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;General and administrative</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD></TR>
<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">90</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">94</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">OPERATING INCOME</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">33</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">OTHER INCOME (EXPENSE)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Interest income</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Other, net</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD></TR>

<TR><TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>


<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">INCOME BEFORE INCOME TAXES AND MINORITY INTEREST</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">32</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">PROVISION FOR INCOME TAXES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Current income taxes</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">MINORITY INTEREST</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="1"></TD></TR>


<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>


<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">NET INCOME</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>

<TR>
<TD COLSPAN="8"><HR NOSHADE SIZE="3"></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">EARNINGS PER SHARE</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Basic</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;.0</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;.1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">5</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Diluted</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">5</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">WEIGHTED AVERAGE COMMON SHARES OUTSTANDING</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Basic</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Diluted</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">138</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">CASH DIVIDENDS PER SHARE</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;.02</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;$&nbsp;&nbsp;.02</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">5</FONT></TD></TR>
</TABLE>

<TABLE WIDTH=600>
<TR><TD>&nbsp;</TD></TR>
<TR><TD ALIGN=CENTER>The accompanying notes are an integral part of these financial statements.</TD></TR>
</TABLE>



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<TABLE WIDTH=600>
<TR><TD><HR SIZE=5 NOSHADE><BR></TD></TR>
<TR>
<TD>

<H1 ALIGN=CENTER><FONT SIZE=3><B>ENSCO INTERNATIONAL INCORPORATED AND SUBSIDIARIES</B><BR>
CONSOLIDATED BALANCE SHEET<BR></FONT>
<FONT SIZE=-1><B>(In millions, except par value amounts)</B></FONT></H1>

</TABLE>

<A NAME="C"></A>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="600">

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<B>March 31,</B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<B>December 31,</B></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp; <B><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<B><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1999&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></B></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-2"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<B>(Unaudited)</B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp; <B>&nbsp;</B></FONT></TH></TR>

<TR><TD>&nbsp;</TD></TR>


<TR VALIGN="BOTTOM">
<TD WIDTH="64%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>ASSETS</B></FONT></TD>
<TD WIDTH="3%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="13%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="5%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="13%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">CURRENT ASSETS</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;82</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;144</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Short-term investments</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">96</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">85</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">21</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">22</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">200</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">272</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">PROPERTY AND EQUIPMENT, AT COST</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2,113</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2,077</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Less accumulated depreciation</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">517</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">500</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment, net</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,596</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,577</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">OTHER ASSETS, NET</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">127</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">128</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$1,924</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$1,978</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>LIABILITIES AND STOCKHOLDERS' EQUITY</B></FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">CURRENT LIABILITIES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">92</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">122</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Current maturities of long-term debt</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">102</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">134</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">LONG-TERM DEBT</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">360</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">371</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">DEFERRED INCOME TAXES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">200</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">199</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">OTHER LIABILITIES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">14</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">14</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">MINORITY INTEREST</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">17</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">COMMITMENTS AND CONTINGENCIES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">STOCKHOLDERS' EQUITY</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, $1 par value, 20.0 million shares authorized,</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;none issued</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock,
$.10 par value, 250.0 million shares authorized,</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
156.5 million and 155.9 million shares issued</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">15</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">15</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">856</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">850</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">531</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">531</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted stock (unearned compensation)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(6</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cumulative translation adjustment</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Treasury stock, at cost, 18.7 million
shares</FONT></TD><TD ALIGN="LEFT">
<FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(150</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(148</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity</FONT></TD><TD ALIGN="LEFT">
<FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,247</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,241</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$1,924</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$1,978</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>
<TABLE WIDTH=600>
<TR><TD>&nbsp;</TD></TR>

<TR>
<TD>
<P ALIGN=CENTER>The accompanying notes are an integral part of these financial statements.</P>
<BR>
<BR><BR><BR><BR>
</TD>
</TR>
</TABLE>







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<TABLE WIDTH=600>
<TR><TD><HR SIZE=5 NOSHADE><BR></TD></TR>
<TR>
<TD>

<H1 ALIGN=CENTER><FONT SIZE=3><B>ENSCO INTERNATIONAL INCORPORATED AND SUBSIDIARIES<BR>
CONSOLIDATED STATEMENT OF CASH FLOWS</B><BR></FONT>
<FONT SIZE=-1><B>(In millions)</B><BR>
<B>(Unaudited)</B></FONT></H1>

</TD>
</TR>
</TABLE>

<A NAME="D"></A>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="600">

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="4"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Three Months Ended</FONT></TH>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="4"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;
&nbsp;&nbsp;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;March 31,&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TH>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2">&nbsp;&nbsp;<FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>&nbsp;&nbsp;2000&nbsp;&nbsp;</U></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>&nbsp;&nbsp;1999&nbsp;&nbsp;</U></FONT></TH>
<TR VALIGN="BOTTOM">
<TD WIDTH="62%" ALIGN="LEFT"><FONT SIZE="-1">OPERATING ACTIVITIES</FONT></TD>
<TD WIDTH="3%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="5%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Net income</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;provided by operating activities:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income tax provision</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of other assets</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on asset dispositions</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) decrease in accounts receivable</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">37</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(Increase) decrease in prepaid expenses and other</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase (decrease) in accounts payable</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase (decrease) in accrued liabilities</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(35</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by operating activities</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">18</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">68</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">INVESTING ACTIVITIES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Additions to property and equipment</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(86</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(80</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from disposition of assets
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Sale of short-term investments
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Acquisition of minority interest
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(9</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD></TR>


<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used by investing activities</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(70</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(79</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">FINANCING ACTIVITIES</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from long-term borrowings</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">62</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD></TR>


<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Reduction of long-term borrowings</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(74</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Cash dividends</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from exercise of stock options</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;Other</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash used by financing activities</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(10</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">DECREASE IN CASH AND CASH EQUIVALENTS</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(61</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(35</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">144</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">330</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">CASH AND CASH EQUIVALENTS, END OF PERIOD</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;82</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$294</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>

<TABLE WIDTH=600>
<TR><TD>&nbsp;</TD></TR>

<TR>
<TD>
<P ALIGN=CENTER>The accompanying notes are an integral part of these financial statements.</P>
<BR>
<BR><BR><BR>
<TR>
<TD>
</TABLE>




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<TABLE WIDTH=600>
<TR><TD><HR SIZE=5 NOSHADE><BR></TD></TR>
<TR>
<TD>

<H1 ALIGN=CENTER><FONT SIZE=3><B>ENSCO INTERNATIONAL INCORPORATED AND SUBSIDIARIES<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</B><BR></FONT>
<FONT SIZE=-1><B>(Unaudited)</B></FONT></H1>

</TD>
</TR>
</TABLE>

<A NAME="E"></A>

<TABLE WIDTH=600>

<TR><TD>

<H2 ALIGN=LEFT><FONT SIZE=3>Note 1 - Unaudited Financial Statements</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The accompanying consolidated financial
statements of ENSCO International Incorporated (the "Company") have been prepared in accordance
with generally accepted accounting principles, pursuant to the rules and regulations of the
Securities and Exchange Commission included in the instructions to Form 10-Q and Article 10 of
Regulation S-X. The financial information included herein is unaudited but, in the opinion of
management, includes all adjustments (consisting of normal recurring adjustments) which are necessary
for a fair presentation of the financial position, results of operations and cash flows for the interim
periods presented. The December 31, 1999 consolidated balance sheet data was derived from audited financial
statements, but does not include all disclosures required by generally accepted accounting principles.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The financial data for the three month periods ended
March 31, 2000 and 1999 included herein have been subjected to a limited review by PricewaterhouseCoopers LLP,
the registrant's independent accountants. The accompanying review report of independent accountants
is not a report within the meaning of Sections 7 and 11 of the Securities Act of 1933 and the
independent accountant's liability under Section 11 does not extend to it.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Results of operations for the three month period ended March 31, 2000
are not necessarily indicative of results of operations which will be realized for the year ending
December 31, 2000. It is recommended that these statements be read in conjunction with the Company's
consolidated financial statements and notes thereto for the year ended December 31, 1999 included in the
Company's Annual Report to the Securities and Exchange Commission on Form 10-K.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Note 2 - Earnings Per Share</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For the three months ended March 31, 2000 and 1999, there
were no adjustments to net income for purposes of calculating basic and diluted earnings per share. The
following is a reconciliation of the weighted average common shares used in the basic and diluted
earnings per share computations for the three months ended March 31, 2000 and 1999 (in millions):</P>
<P ALIGN=LEFT>&nbsp;</P>
</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"> <B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="62%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average common shares - basic</FONT></TD>
<TD WIDTH="5%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="13%" ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD WIDTH="5%" ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD WIDTH="13%" ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;Potentially dilutive common shares</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;Restricted stock grants</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">--</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;Stock options</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;Weighted average common shares - diluted</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">138</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">136</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>

<TABLE WIDTH=600>
<TR><TD>&nbsp;</TD></TR>
<TR>
<TD>
<H2 ALIGN=LEFT><FONT SIZE=3>Note 3 - Long-term Debt</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March 2000,
the Company borrowed $62.6 million under its floating rate term loan agreement
(the &#147;Facility&#148;), which provides approximately $195 million of interim
financing for the construction of the ENSCO 7500, the Company&#146;s new
semisubmersible rig. Interest on amounts borrowed under the Facility are payable
semi-annually at a variable rate based on the lender&#146;s cost of funds plus
.15% (approximately 6.2% at March 31, 2000). Amounts borrowed under the Facility will be
repaid with proceeds from 15-year bonds to be issued after completion of rig
construction, and the 15-year bonds will be repaid in 30 semi-annual payments of principal and interest.
The Company expects to complete the rig construction in the fourth quarter of
2000. All borrowings under both the Facility and 15-year bonds are
guaranteed by the United States Maritime Administration.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On March 15,
2000, the Company exercised its option to redeem all of its 9-7/8% Senior
Subordinated Notes due in 2004 (the &#147;Notes&#148;) at a price equal to
103.29% of the face amount, or $74.2 million, plus accrued interest. The excess
of the amount paid over the carrying value of the Notes totaled $500,000 and has
been charged to &#147;Other, net&#148; under Other Income (Expense) in the
Consolidated Statement of Income for the three months ended March 31, 2000.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Note 4 - Minority Interest</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Portions of the
Company&#146;s Venezuelan operations are conducted through ENSCO Drilling
(Caribbean), Inc. (&#147;Caribbean&#148;). From January 1, 1995 through December
31, 1999, the Company held an 85% interest in Caribbean and a private
company held the remaining 15%. On February 10, 2000, the Company purchased the
remaining 15% interest in Caribbean from the private company and
Caribbean became a wholly-owned subsidiary of the Company.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Note 5 - Contingency</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During 1998, the Company
began construction of the ENSCO 7500, a dynamically
positioned semisubmersible rig. The ENSCO 7500 has an approximate $190 million,
three-year contract with Burlington Resources ("Burlington") that is scheduled
to commence upon satisfactory completion of construction. The Company expects to
complete construction during the fourth quarter of 2000. However, if the rig is
not delivered in accordance with the specifications agreed with Burlington prior
to the contractual delivery deadline of March 24, 2001, Burlington has the right
to terminate the drilling contract.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Note 6 - Segment Information</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company's operations are categorized into two operating segments which are differentiated based on the
core services provided by the Company, (1) contract drilling services and (2) marine transportation services.
The Company's contract drilling segment owns a fleet of 54 offshore drilling rigs, including 37
jackup rigs, nine barge rigs, seven platform rigs and one semisubmersible rig, which is under
construction. The Company's marine transportation segment owns a fleet
of 30 oilfield support vessels. Operating income (loss) for each segment includes an allocation of general and
administrative expenses of the Company's corporate office. Depreciation expense of the Company's corporate
office is not allocated to the operating segments. Segment information for the three months ended March 31, 2000
and 1999 is as follows (in millions):</P>

</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="8"><FONT SIZE="-1"><B>INDUSTRY SEGMENT</B></FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp; </FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B>Contract</B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B>&nbsp;&nbsp;&nbsp;Marine</B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH></TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>Drilling</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"> &nbsp;&nbsp;&nbsp;<B><U>Transportation</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"> &nbsp;&nbsp;&nbsp;<B><U>Corporate</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Total</U></B></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="40%" ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <FONT SIZE="-1"><B><U>2000</U></B></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="6%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Revenues</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;88</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;96</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Operating income (loss)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;6</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="40%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="6%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="40%" ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1"><B><U>1999</U></B></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="6%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Revenues</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$117</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;10</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$127</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Operating income (loss)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">34</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">33</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
</TABLE>


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<A NAME="G"></A>

<TABLE WIDTH=600>
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<P ALIGN=LEFT><B>Item 2.&nbsp;&nbsp;<I>Management's Discussion and Analysis of Financial Condition and Results of<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operations</I></B></P>
<BR>

<P ALIGN=LEFT><B>&nbsp;&nbsp;&nbsp;&nbsp;BUSINESS ENVIRONMENT</B></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ENSCO International Incorporated is one of the leading international providers of offshore drilling
services and marine transportation services to the oil and gas industry. The Company's operations are conducted
in the geographic regions of North America, Europe, Asia Pacific and South America.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Demand for the Company's services is significantly affected by worldwide expenditures for oil and gas
drilling. Expenditures for oil and gas drilling activity fluctuate based upon many factors including world
economic conditions, the legislative environment in the U.S. and other major countries, production levels and
other activities of OPEC and other oil and gas producers, and the impact that these and other events have on the
current and expected future pricing of oil and natural gas.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Industry
conditions were adversely impacted during 1999 as a result of curtailed or
deferred exploration and development spending by oil companies. Due primarily to
cutbacks in oil production by OPEC and to a more favorable outlook for worldwide
oil demand, oil prices began increasing in early 1999 and such price increases
have been sustained through the first quarter of 2000. Although higher oil
prices improves the likelihood of oil companies increasing their exploration and
development spending, the timing and rate of such spending increases and the
corresponding impact on the Company&#146;s operations and financial results are
uncertain.</P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The recent
improvement in oil prices and U.S. natural gas prices has led to improved
demand for drilling rigs in domestic markets, and the increasing trend in domestic day
rates and utilization experienced by the Company during the fourth quarter of
1999 has continued throughout the first quarter of 2000. However, improvement
in demand for drilling rigs in international markets continues to lag the
domestic markets. While activity levels in international markets have begun to
increase, the Company does not expect appreciable improvement in international
market day rates until the latter part of 2000. </FONT></P>

<P ALIGN=LEFT><B>&nbsp;&nbsp;&nbsp;&nbsp;RESULTS OF OPERATIONS</B></P>

<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s results for the first quarter of 2000 continue to reflect the
impact of the industry downturn that began in 1998. The decrease in operating
results from the first quarter of 1999 to the first quarter of 2000 is primarily
due to lump-sum payments totaling $20.4 million in the first quarter of 1999
resulting from the early termination of various drilling contracts. While the
Company did experience an increase in operating results from its domestic jackup
rig fleet in the current quarter compared to the prior year quarter, this
increase was more than offset by a decrease in the operating results from its
international rig fleets. </FONT></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following analysis highlights the Company's operating results for the three months ended March 31,
2000 and 1999 (in millions):</P>

</TD></TR>
<TR><TD>&nbsp;</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="600">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;&nbsp;2000&nbsp;&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;&nbsp;1999&nbsp;&nbsp;</U></B></FONT></TH></TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="70%" ALIGN="LEFT"><FONT SIZE="-1"><B><U>Operating Results</U></B></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="6%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>


<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;96</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$127</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating expenses,
including general and administrative</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">66</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">70</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating income</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">33</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other expense, net</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for income taxes</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Minority interest</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="600">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="70%" ALIGN="LEFT"><FONT SIZE="-1"><B><U>Revenues</U></B></FONT></TD>
<TD WIDTH="4%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="6%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract drilling</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jackup rigs:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;51</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;35</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">33</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asia Pacific</FONT></TD><TD ALIGN="LEFT">
<FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">17</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">14</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total jackup rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">72</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">83</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barge rigs - South America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">11</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Platform rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">13</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total contract drilling</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">88</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">117</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;Marine transportation</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AHTS(1)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mini-Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total marine transportation</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">10</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;96</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$127</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>


<TR><TD>&nbsp;</TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1"><B><U>Operating Margin(2)</U></B></FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract drilling</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jackup rigs:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;9</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">20</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asia Pacific</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total jackup rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">24</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">35</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barge rigs - South America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">15</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Platform rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total contract drilling</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">31</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">58</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Marine transportation</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AHTS(1)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">-</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mini-Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2)</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total marine transportation</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;32</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;60</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

</TABLE>


<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;(1)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">Anchor handling tug supply vessels.</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT>&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">(2)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">Defined as revenues less operating expenses, exclusive of depreciation and general and
administrative expenses.</FONT></TD>
</TR>
</TABLE>

<!-- *********************************************************************** -->
<!-- MARKER LABEL="SHEET: , PAGE 9" -->

<TABLE WIDTH=600>
<TR><TD><HR SIZE=5 NOSHADE><BR></TD></TR>
<TR>
<TD>


<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is an
analysis of certain operating information of the Company for the three months ended
March 31, 2000 and 1999:</P>
</TD></TR>

<TR><TD>&nbsp;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="600">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="62%" ALIGN="LEFT"><FONT SIZE="-1"><B><U>Contract Drilling</U></B></FONT></TD>
<TD WIDTH="5%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;Rig utilization:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jackup rigs:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">99%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">87%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">14%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">86%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asia Pacific</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">69%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">57%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total jackup rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">77%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">81%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barge rigs - South America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">33%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">17%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Platform rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">48%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">74%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">65%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">72%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;Average day rates:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jackup rigs:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$26,045</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$20,258</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">34,538</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">61,009</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asia Pacific</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">35,761</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">40,836</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total jackup rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">28,084</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">30,351</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Barge rigs - South America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">39,341</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">17,163</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Platform rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">21,316</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23,853</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$28,645</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$29,054</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1"><B><U>Marine Transportation</U></B></FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;Fleet utilization:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AHTS*</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">55%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">70%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">69%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">73%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mini-Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">31%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">60%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">63%</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;Average day rates:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AHTS*</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$13,479</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$15,123</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2,991</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3,289</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mini-Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,889</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2,315</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;4,522</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;5,005</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

</TABLE>



<TABLE WIDTH=600>

<TR><TD><FONT SIZE=-1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;Anchor
handling tug supply vessels.</FONT></TD></TR>


<TR><TD>&nbsp;</TD></TR>
<TR><TD>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discussions relative to
each of the Company's operating segments and significant changes in operating
results for the three months ended March 31, 2000 compared with the results
of the corresponding prior year period are set forth below. See "Business Environment"
and "Outlook and Forward-Looking Statements" for additional information about the Company's
current expectations regarding future operations, day rates and utilization.</P>

</TD></TR>
<TR><TD>&nbsp;</TD></TR>
<TR><TD>

<H2 ALIGN=LEFT><FONT SIZE=3>Contract Drilling</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is an
analysis of the Company's offshore drilling rigs at March 31, 2000 and 1999:</P>


</TD></TR>

</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2" ALIGN=LEFT><FONT SIZE="-1"><B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="71%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jackup rigs:</FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="10%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE="-1"></FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North America</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">22</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">22</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe(1)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asia Pacific</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total jackup rigs</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">37</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">36</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Barge rigs - South America(2)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">9</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;Platform rigs(3)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">53</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">51</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>

<TR><TD>&nbsp;</TD></TR>

</TABLE>

<TABLE WIDTH=500>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;(1)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">In February 2000, the Company completed
construction of a harsh environment jackup rig that was mobilized to the North Sea, arriving
in April 2000. The rig is undergoing final preparations and is expected to begin drilling operations
in the second or third quarter of 2000.</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=500>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;(2)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">The Company completed construction
of three new barge rigs during 1999, the first of which was added to the Company's fleet during the first
quarter and the remaining two were added in the second quarter of 1999.
</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=500>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT>&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">(3)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">In April 1999, the Company completed
the operating contract for a platform rig
that was located off the coast of China. The platform rig was not owned by the
Company, but operated under a management contract. The Company's seven
remaining platform rigs are all located in the Gulf of Mexico.</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
</TABLE>



<TABLE WIDTH=600>
<TR><TD>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First quarter 2000 revenues
for the Company's drilling segment compared
to the first quarter of 1999 decreased by $29.4 million, or 25%, and operating
margin decreased by $27.1 million, or 46%. These decreases are due primarily to
the receipt of lump sum early contract termination payments totaling $20.4
million in the first quarter of 1999, and to lower utilization for drilling
rigs, which decreased to 65% in the current year quarter from 72% in the prior year
quarter. Operating expenses for the contract drilling segment decreased by
$2.3 million, or 4%, from the prior year due primarily to decreased utilization.
</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;<I>North America Jackup Rigs</I></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues for the first
quarter of 2000 for the North America jackup rigs
increased by $16.6 million, or 47%, and operating margin increased by $14.2
million, or 148%, as compared to the prior year first quarter. The increase in
revenues and operating margin is due primarily to a 29% increase in average day
rates and to an increase in utilization, to 99% in the current year quarter as
compared to 87% in the prior year quarter. Operating expenses increased by $2.4
million, or 9%, as compared to the prior year quarter, due primarily to higher
utilization.
</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;<I>Europe Jackup Rigs</I></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First quarter revenues
for the Europe jackup rigs decreased by $30.1
million, or 90%, and operating margin decreased by $24.9 million, or 120%, as
compared to the prior year quarter. The decrease in revenues is due primarily to
a decrease in utilization, to 14% in the current year quarter from 86% in the
prior year quarter, and to a 43% decrease in average day rates. Operating
expenses for the Europe jackup rigs decreased by $5.2 million, or 41%, from the
prior year quarter due primarily to substantially lower utilization.
</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;<I>Asia Pacific Jackup Rigs</I></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First quarter revenues for
the Asia Pacific jackup rigs increased by $2.3
million, or 16%, and operating margin decreased by $100,000, or 2%, as compared
to the prior year quarter. The increase in revenues is due primarily to an
increase in utilization, to 69% in the current quarter from 57% in the prior
year quarter. The slight decrease in operating margin in the current year quarter is
primarily attributable to a 12% decrease in average day rates. Operating
expenses increased approximately $2.4 million, or 26%, from the prior year
quarter due primarily to higher utilization.
</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;<I>South America Barge Rigs</I></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First quarter revenues for
the South America barge rigs decreased by $9.5
million, or 46%, and operating margin decreased by $10.5 million, or 67%, as
compared to the prior year quarter. The decrease in revenue and operating margin
is due primarily to the receipt of lump-sum early contract termination payments
totaling $18.4 million in the prior year quarter. The impact of the early contract
termination payments in the prior year quarter was partially offset by a 129% increase
in average day rates and by an increase
in utilization, to 33% in the current quarter from 17% in the year earlier
quarter. The increase in utilization in the current quarter is due primarily to
full utilization of three newly constructed barge rigs that commenced operations
in March, April and June of 1999. The six barge rigs which experienced early
contract termination in January 1999 remained idle during the current quarter.
</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;<I>Platform Rigs</I></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First quarter revenues
for the platform rigs decreased by $8.7 million,
or 63%, and operating margin decreased by $5.8 million, or 79%, as compared to
the prior year quarter. The decrease in revenue and operating margin is due
primarily to a decrease in utilization to 48% in the current quarter from 74% in
the prior year quarter, to a lump sum contract cancellation payment received in
the first quarter of 1999, and to an 11% decrease in average day rates.
Operating expenses decreased by $2.9 million, or 45%, as compared to the prior
year quarter due primarily to lower utilization.
</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Marine Transportation</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is an
analysis of the Company's marine transportation vessels as of March 31, 2000 and 1999:</P>
</TD></TR>
<TR><TD>&nbsp;</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="66%" ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">AHTS(1)(2)</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD WIDTH="10%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE="-1">5</FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Supply</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">Mini-Supply(3)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total(4)</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">30</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">36</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>

<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">&nbsp;</FONT></TD>
</TR>
</TABLE>


<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;(1)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">Anchor handling tug supply vessels.</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT>&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">(2)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">During the third quarter of 1999, the Company
added a 196 foot, 6,000 horsepower vessel to its fleet. The vessel is being leased, and the
Company has an option to purchase the vessel beginning in February 2001. During the first quarter
of 2000, the Company sold an older, less competitive AHTS vessel.
</FONT></TD>
</TR>

</TABLE>


<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;(3)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">The Company sold two mini-supply vessels during the
fourth quarter of 1999 and four mini-supply vessels during the first quarter of 2000.</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=600>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=RIGHT>&nbsp;&nbsp;&nbsp;<FONT SIZE="-1">(4)</FONT></TD>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=90% ALIGN=LEFT><FONT SIZE="-1">All of the Company's marine transportation
vessels are located in the
Gulf of Mexico.</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
</TABLE>


<TABLE WIDTH=600>
<TR><TD>
<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For the first quarter
2000, revenues for the Company's marine
transportation segment decreased by $2.1 million, or 21%, and operating margin
decreased by $700,000, or 44%, as compared to the prior year quarter. The
decrease in revenues and operating margin is due primarily to a decrease in
utilization, to 60% in the current quarter from 63% in the prior year quarter,
and a 10% decrease in average day rates. Operating expenses decreased by $1.4
million, or 16%, due primarily to lower utilization and the reduced number of vessels in the Company's
fleet.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Depreciation and Amortization</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization
expense for the first quarter of 2000
decreased by $100,000, or less than one percent, as compared to the prior year
quarter. The decrease is attributable to the suspension of depreciation on one of the
Company's harsh environment jackup rigs during the first quarter of 2000 while it is in
the shipyard undergoing enhancements and to the sale of seven marine vessels during the
fourth quarter of 1999 and the first quarter of 2000. The $1.3 million decrease resulting
from the jackup rig in the shipyard and the vessel sales was substantially offset by increased
depreciation associated with three new barge rigs constructed during 1999 and other enhancement and sustaining
capital expenditures during 1999 and the first quarter of 2000.

</P>

<H2 ALIGN=LEFT><FONT SIZE=3>General and Administrative</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative
expense for the first quarter of 2000
increased by $200,000, or 7%, as compared to the prior year quarter. The
increase is primarily due to minor increases in payroll and benefits, travel and
entertainment and professional fees.
</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Other Income (Expense)</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other income (expense)
for the three months ended March 31, 2000 and 1999 was as follows (in millions):
</P>
</TD></TR>
</TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="60%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income</FONT></TD>
<TD WIDTH="8%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;2</FONT></TD>
<TD WIDTH="10%" ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;4</FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net:</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(7</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(8</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capitalized interest</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.7</FONT></TD></TR>

<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0)&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(5</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other, net</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;(</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.9)</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;(1</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.4)</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>

<TABLE WIDTH=600>

<TR><TD>&nbsp;</TD></TR>

<TR><TD>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income decreased
in the first quarter of 2000 as compared to the
prior year quarter due primarily to lower average invested cash balances.
Interest expense decreased as compared to the prior year quarter due primarily to lower
average debt balances. Capitalized interest increased $1.6 million in the first quarter
of 2000 as compared to the prior year quarter due to an increase in the amount invested
in construction projects, primarily the ENSCO 7500. Other, net increased $200,000
in the first quarter of 2000 as compared to the prior year quarter. The increase is
due primarily to $600,000 of gains in connection with the sale of five marine vessels in the
first quarter of 2000, partially offset by a $500,000 loss on the early retirement of the
Company's 9-7/8% Senior Subordinated Notes in March 2000 (see "Financing and Capital Resources").
</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Provision for Income Taxes</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company's provision for income taxes decreased by $10.2 million for
the three months ended March 31, 2000 as compared to the prior year period, due
to the reduced profitability of the Company.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Minority Interest</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Portions of the Company's Venezuelan
operations are conducted through ENSCO Drilling (Caribbean), Inc. ("Caribbean"). During 1999,
the Company held an 85% interest in Caribbean and a private company held the remaining
15%. On February 10, 2000, the Company purchased the remaining 15% interest in Caribbean from the
private company and Caribbean became a wholly-owned subsidiary of the Company.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>LIQUIDITY AND CAPITAL RESOURCES</FONT></H2>

<H2 ALIGN=LEFT><FONT SIZE=3>Cash Flow and Capital Expenditures</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company's cash flow from operations
and capital expenditures for the three months ended March 31, 2000
and 1999 are as follows (in millions):</P>

</TD></TR>

<TR><TD>&nbsp;</TD></TR>

</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<B><U>&nbsp;2000&nbsp;</U></B></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>&nbsp;1999&nbsp;</U></B></FONT></TH></TR>

<TR><TD>&nbsp;</TD></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="60%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash flow from operations</FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;18</FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">.9</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;68</FONT></TD>
<TD WIDTH="2%" ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;New
construction</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;63</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;66</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>

<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Enhancements</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">21</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">10</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sustaining</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">3</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.8</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="1"></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;86</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.5</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;80</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD></TR>
<TR>
<TD COLSPAN="6"><HR NOSHADE SIZE="3"></TD></TR>
</TABLE>

<TABLE WIDTH=600>

<TR><TD>&nbsp;</TD></TR>

<TR><TD>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash flow from operations decreased by $49.3
million for the first quarter of 2000 as compared to the
prior year quarter. The decrease in cash flow from operations is due primarily to reduced operating margins and
reduced cash flow from working capital changes.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management anticipates that capital expenditures for the full year 2000
will be approximately $255
million, including $140 million for new construction projects, $95 million for enhancements and $20 million for
sustaining operations.</P>

<H2 ALIGN=LEFT><FONT SIZE=3>Financing and Capital Resources</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company's long-term debt, total capital and debt to capital ratios at March 31, 2000 and December 31,
1999 are summarized below (in millions, except percentages):</P>

</TD></TR>
<TR><TD>&nbsp;</TD></TR>
</TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;March 31,</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">December 31,</FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1999&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TH></TR>


<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="48%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term debt</FONT></TD>
<TD WIDTH="10" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="15%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;360</FONT></TD>
<TD WIDTH="10%" ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;371</FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total capital</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,607</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">1,612</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.2</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term debt to total capital
</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">22.4</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">%</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">23.0</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">%</FONT></TD></TR>
</TABLE>

<TABLE WIDTH=600>

<TR><TD>&nbsp;</TD></TR>

<TR><TD>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In June 1999,
the Company received a commitment from the United States Maritime Administration
(&#147;MARAD&#148;) for the guarantee of approximately $195 million of long-term
debt for the construction of the ENSCO 7500, the Company&#146;s new
semisubmersible rig. The MARAD guarantee covers interim construction financing,
as well as 15 year bonds to be issued upon completion of construction. In
December 1999, the Company entered into a floating rate term loan agreement (the
&#147;Facility&#148;) with a major financial institution (the
&#147;Lender&#148;) to provide interim financing during the rig construction
period. Interest on amounts borrowed under the Facility will be payable
semi-annually at a variable rate based on the Lender&#146;s cost of funds plus
0.15% (approximately 6.2% at March 31, 2000). At March 31, 2000, borrowings under the Facility
totaled $62.6 million. Amounts borrowed under the Facility will be repaid with
proceeds from 15-year bonds to be issued after completion of rig construction,
and the 15-year bonds will be repaid in 30 semi-annual payments of principal and interest. The Company
currently expects to complete rig construction in the fourth quarter of 2000. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March 2000,
a wholly-owned subsidiary of the Company, Dual Holding Company, exercised its option to redeem all of its 9-7/8% Senior Subordinated
Notes due in 2004 at a price equal to 103.29% of the principal amount, or $74.2
million, plus all accrued interest. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to
ensure the Company has adequate liquidity and resources for growth, the Company
continues to maintain its $185 million unsecured revolving line of credit (the
&#147;Credit Agreement&#148;) with a syndicate of banks. As of March 31, 2000,
the Company had the full $185 million available for borrowings under the Credit
Agreement. The Credit Agreement matures in May 2003. </FONT></P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s liquidity position at March 31, 2000 and December 31, 1999 is
summarized in the table below (in millions, except ratios): </FONT></P>

<TR><TD>&nbsp;</TD></TR>

</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="500">
<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">March 31,</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">December 31,</FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1"></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1999&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH>
<TH COLSPAN="2"><FONT SIZE="-1">&nbsp;</FONT></TH></TR>

<TR VALIGN="BOTTOM">
<TD WIDTH="49%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash
and short-term investments</FONT></TD>
<TD WIDTH="7%" ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;&nbsp;&nbsp;82</FONT></TD>
<TD WIDTH="10%" ALIGN="LEFT"><FONT SIZE="-1">.6</FONT></TD>
<TD WIDTH="14%" ALIGN="RIGHT"><FONT SIZE="-1">$&nbsp;&nbsp;165</FONT></TD>
<TD WIDTH="12%" ALIGN="LEFT"><FONT SIZE="-1">.3</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Working capital</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">98</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.1</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">138</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
<TR VALIGN="BOTTOM">
<TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current ratio</FONT></TD><TD ALIGN="LEFT"><FONT SIZE="-1">&nbsp;</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD>
<TD ALIGN="RIGHT"><FONT SIZE="-1">2</FONT></TD>
<TD ALIGN="LEFT"><FONT SIZE="-1">.0</FONT></TD></TR>
</TABLE>

<TABLE WIDTH=600>

<TR><TD>&nbsp;</TD></TR>

<TR><TD>
<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based on the current financial condition of the Company, management
believes cash flow from operations, the ENSCO 7500 financing guaranteed by
MARAD, the Company's existing Credit Agreement and the Company's working capital
should be sufficient to fund the Company's ongoing liquidity needs for the
foreseeable future.</P>

</TD></TR>

<TR><TD>&nbsp;</TD></TR>

</TABLE>

<TABLE WIDTH=600>

<TR><TD>

<H2 ALIGN=LEFT><FONT SIZE=3>MARKET RISK</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company occasionally uses derivative financial instruments to hedge against its exposure to changes in
foreign currencies. The Company does not use derivative financial instruments for trading purposes. The Company
predominantly structures its drilling rig contracts in U.S. dollars to mitigate its exposure to fluctuations in
foreign currencies. The Company will, however, from time to time, hedge its known liabilities or projected
payments in foreign currencies to reduce the impact of foreign currency gains and losses in its financial
results. At March 31, 2000, the Company had foreign currency exchange contracts outstanding to exchange U.S.
dollars for Dutch guilders totaling $25.1 million. At March 31,
2000, there were no material unrealized gains or losses on open foreign currency exchange derivative hedges.
Management believes that the Company's hedging activities do not expose the Company to any material interest rate
risk, foreign currency exchange rate risk, commodity price risk or any other market rate or price risk.</P>

<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company has
exposure to market risk in connection with the variable interest rate on amounts
borrowed under the Facility, the Company&#146;s interim construction financing
guaranteed by MARAD. As the interest rate on amounts borrowed under the Facility
is ultimately based on changes in LIBOR, the Company&#146;s exposure to interest
rate risk due to changes in the Facility interest rate are not expected to be
material. </FONT></P>

<H2 ALIGN=LEFT><FONT SIZE=3>OUTLOOK AND FORWARD-LOOKING STATEMENTS</FONT></H2>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to the
short-term nature of many of the Company&#146;s contracts and the unpredictable
nature of oil and natural gas prices, which affect demand for drilling activity,
timing of the improvement in industry conditions experienced during 1999 cannot
be accurately predicted. Whether recent oil price levels will be sustained is
not determinable at the present time, and even if current price levels persist,
significantly higher average day rates for the Company&#146;s fleet as a whole
will probably not be realized for several quarters.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Improved oil
prices and U.S. natural gas prices increased demand for drilling rigs and marine
vessels in domestic markets during the latter part of 1999. The increases in
domestic day rates and utilization experienced by the Company during the fourth
quarter of 1999 have continued throughout the first quarter of 2000. In the near
term, the Company believes that improvements in day rates in domestic markets
will generally continue.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although demand
for drilling rigs in international markets has begun to increase, as of this
date there has been no appreciable improvement in day rates in international
markets. Providing that current oil price levels are sustained, management
expects a recovery in international markets to commence during the latter part
of 2000.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company
stacked certain rigs and vessels during 1999 as a result of industry conditions.
The Company&#146;s policy is to stack its rigs and vessels if it does not
believe there will be a market for the equipment in the near term or if
sufficient cash flow cannot be generated to cover cash operating costs. The
Company&#146;s North America jackup rig fleet operated at near full utilization
during the first quarter of 2000 and the Company expects such utilization levels
to continue for the North America jackup rig fleet at least through the remainder
of the year. Currently, seven rigs in the Company&#146;s international jackup rig fleet are
idle, including four jackup rigs in the Europe region and three jackup rigs in
the Asia Pacific region. However, the Company expects all of these rigs to
commence operations during the second or third quarter of 2000 with the
exception of one rig which is in the shipyard undergoing enhancements and
upgrades that will be completed in the fourth quarter of 2000. The
Company has six idle barge rigs in South America, four of which are stacked and
two of which continue to be marketed. In the marine transportation segment,
there are currently three supply vessels stacked.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During 1998, the
Company began construction of the ENSCO 7500, a dynamically positioned
semisubmersible rig. The ENSCO 7500 has an approximate $190 million, three-year
contract with Burlington Resources (&#147;Burlington&#148;) that is scheduled to
commence upon satisfactory completion of construction. The Company expects to
complete construction during the fourth quarter of 2000. Construction of a
semisubmersible rig such as the ENSCO 7500 involves complex design and
engineering, as well as extensive equipment and supply delivery coordination
throughout the construction period. It is not unusual for shipyards to encounter
design and engineering changes, equipment delivery schedule changes, and other
factors that impact the ability to complete construction in accordance with
original contractual budgets and delivery schedules. The shipyard constructing
the ENSCO 7500 has recently experienced cost overruns and delays on other rig
construction projects, including certain barge rigs built for the Company. To
date, the Company has not experienced significant cost overruns or unanticipated
delays in connection with the ENSCO 7500 construction. However, if construction
delays should occur and the ENSCO 7500 is not delivered in accordance with the
specifications agreed with Burlington prior to the delivery deadline under the
Burlington contract of March 24, 2001, Burlington has the right to terminate the
contract. Termination of the Burlington contract could have a material adverse
effect on the Company&#146;s operating results.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This report
contains forward-looking statements based on current expectations that involve a
number of risks and uncertainties. Generally, forward-looking statements include
words or phrases such as &#147;management anticipates,&#148; &#147;the Company
believes,&#148; &#147;the Company anticipates,&#148; &#147;the Company
expects,&#148; &#147;the Company plans&#148; and words and phrases of similar
impact, and include but are not limited to statements regarding future
operations and business environment. The forward-looking statements are made
pursuant to safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. The factors that could cause actual results to differ materially
from those in the forward-looking statements include the following: (i) industry
conditions and competition, (ii) cyclical nature of the industry, (iii)
worldwide expenditures for oil and gas drilling, (iv) operational risks and
insurance, (v) risks associated with operating in foreign jurisdictions, (vi)
environmental liabilities which may arise in the future which are not covered by
insurance or indemnity, (vii) the impact of current and future laws and
government regulation, as well as repeal or modification of same, affecting the
oil and gas industry and the Company&#146;s operations in particular, (viii)
changes in the dates the Company&#146;s rigs being constructed or undergoing
enhancement will enter service, (ix) renegotiation, nullification, or breach of
contracts with customers or other parties, and (x) the risks described
elsewhere, herein and from time to time in the Company&#146;s other reports to
the Securities and Exchange Commission, including the Company&#146;s Annual
Report on Form 10-K for the year ended December 31, 1999.</P>

<A NAME="H"></A>

<P ALIGN=LEFT><B>Item 3.&nbsp;&nbsp;&nbsp;<I>Quantitative and Qualitative Disclosures About Market
Risk</I></B></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Information required under Item 3. has been incorporated into Management's Discussion and Analysis of
Financial Condition and Results of Operations - Market Risk.</P>

</TABLE>

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<TR><TD><HR SIZE=5 NOSHADE><BR></TD></TR>
<TR>
<TD>

<P ALIGN=CENTER><B>PART II - OTHER INFORMATION</B></P>

<TR><TD>&nbsp;</TD></TR>

<TR><TD>&nbsp;</TD></TR>


</TABLE>

<A NAME="I"></A>

<TABLE WIDTH=600>
<TR>
<TD>

<P ALIGN=LEFT><B>Item 6.&nbsp;&nbsp;&nbsp;<I>Exhibits and Reports on Form 8-K</I></B></P>

<P ALIGN=LEFT>(a)&nbsp;&nbsp;&nbsp;Exhibits Filed with this Report</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exhibit No.</U></P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1&nbsp;&nbsp;&nbsp;Letter
of Independent Accountants regarding Awareness of Incorporation by<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reference.</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.1&nbsp;&nbsp;&nbsp;Financial Data Schedule. (Exhibit 27.1 is
being submitted as an exhibit only in<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
electronic format of this Quarterly Report
on Form 10-Q submitted<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;to the Securities and
Exchange Commission.)


<P ALIGN=LEFT>(b)&nbsp;&nbsp;&nbsp;Reports on Form 8-K</P>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;None</P>

</TD>
</TR>

</TABLE>



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<TR>
<TD>

<H1 ALIGN=CENTER><FONT SIZE=3><B>SIGNATURES</B></FONT></H1>

<P ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly authorized.</P>

</TD>
</TR>
</TABLE>

<A NAME="J"></A>

<TABLE WIDTH=600 CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=40%></TD>
<TD WIDTH=5%></TD>
<TD WIDTH=55%>ENSCO INTERNATIONAL INCORPORATED</TD></TR>

<TR VALIGN=TOP>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD></TR>

<TR VALIGN=TOP>
<TD>Date:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;May 5, 2000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><TD>
<TD><U>/s/&nbsp;C. Christopher Gaut&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
C. Christopher Gaut<BR>
Chief Financial Officer</TD></TR>

<TR VALIGN=TOP>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD></TR>

<TR VALIGN=TOP>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD>
<TD>&nbsp;<TD></TR>

<TR VALIGN=TOP>
<TD>&nbsp;<TD>
<TD><U>/s/&nbsp;H. E. Malone&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
H. E. Malone<BR>
Corporate Controller and<BR>
Chief Accounting Officer</TD></TR>

</TABLE>







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