Rowan Reports Improved Operating Results

    Business Editors/Energy Editors

    HOUSTON--(BUSINESS WIRE)--April 22, 2005--For the three months ended March 31, 2005, Rowan Companies, Inc. (NYSE:RDC) generated net income of $43.4 million, or 40(cents) per share, compared to a loss of $11.3 million, or 11(cents) per share, in the same period of 2004. Income from continuing operations was $44.6 million, or 41(cents) per share, on revenues of $231.8 million in the first quarter of 2005, compared to a loss of $6.4 million, or 6(cents) per share, on revenues of $149.4 million in the first quarter of 2004.
    Current period results included $28.6 million of gains on asset sales, which improved the Company's after-tax income by approximately 16(cents) per share. Excluding the effects of these transactions, Rowan's first quarter 2005 income from continuing operations and net income would have been approximately 25(cents) and 24(cents) per share, respectively.
    Rowan's offshore rig utilization was 98% during the first quarter of 2005, versus 99% in the fourth quarter of 2004 and 84% in the year-earlier period. Our average Gulf of Mexico day rate was $58,000 during the first quarter, up by $7,400, or 15%, from the fourth quarter of 2004 and by $18,300, or 46%, from the year-earlier period. Land rig utilization was 84% during the first quarter of 2005, versus 73% in the year-earlier period. Our average land rig day rate was $16,300 during the first quarter, up by $2,500, or 18%, from the fourth quarter of 2004 and by $5,300, or 48%, from the year-earlier period.
    Danny McNease, Chairman and Chief Executive Officer, commented, "Rowan's drilling division continues to reach new heights. First quarter revenues were 15% more than our previous quarterly high reached in 2001. The Company's drilling fleet has been almost fully utilized over the past 11 months and our average day rate continues to improve with each new assignment. We have commitments in hand for rates never before achieved in our long history of drilling in the Gulf of Mexico. We believe that this momentum will continue throughout 2005, barring any collapse in oil and natural gas prices.
    "As previously announced, Gorilla VI will soon relocate from the Gulf of Mexico to eastern Canada for work beginning around mid year. This assignment affords Rowan an opportunity to both improve the return on a significant asset and strengthen conditions in the Company's most prominent drilling market.
    "Gorilla VII continues to produce from the North Sea's Ardmore Field under a contract that runs through 2005. The Company's first quarter 2005 revenues included $5.3 million related to this assignment, which we have continued to recognize only upon collection. Assuming that field production remains sufficient to sustain the project throughout the year, we believe this contract will continue to generate significant revenues for Rowan in the future.
    "The prospects for our manufacturing division remain solid. Our manufacturing backlog continues to grow and, at $87 million, is at an all-time high. Strong commodity prices should sustain demand for our mining equipment and parts over the near term.
    "On a personal note, I want to congratulate Ed Thiele on his impending retirement after 36 years of distinguished service to Rowan, the past 16 of which have been as the Company's Chief Financial Officer. Ed's successor in this position is Bill Wells, who has served as Rowan's Controller for the past eleven years."
    Rowan Companies, Inc. is a major provider of international and domestic contract drilling services. The Company also operates a mini-steel mill, a manufacturing facility that produces heavy equipment for the mining and timber industries, and a drilling products division that has designed or built about one-third of all mobile offshore jack-up drilling rigs, including all 24 operated by the Company. The Company's stock is traded on the New York Stock Exchange and the Pacific Exchange - Stock & Options. Common Stock trading symbol: RDC. Contact: William C. Provine, Vice-President - Investor Relations, 713-960-7575. Website: www.rowancompanies.com

    This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs and future expected financial performance of the Company that are based on current expectations and are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected by the Company. Among the factors that could cause actual results to differ materially include oil and natural gas prices, the level of offshore expenditures by energy companies, energy demand, the general economy, including inflation, weather conditions in the Company's principal operating areas and environmental and other laws and regulations. Other relevant factors have been disclosed in the Company's filings with the U.S. Securities and Exchange Commission.

ROWAN COMPANIES, INC. CONDENSED CONSOLIDATED BALANCE SHEET Unaudited (In Thousands)

MARCH 31 ----------------------- 2005 2004 ----------- ----------- ASSETS

Cash and cash equivalents $408,578 $306,435 Accounts receivable 165,536 99,623 Inventories 167,053 152,986 Other current assets 24,262 23,743 ----------- ----------- Total current assets 765,429 582,787 Property, plant and equipment - net 1,684,647 1,646,434 Other assets 15,627 17,074 Assets of discontinued aviation operations 159,510 ----------- ----------- TOTAL $2,465,703 $2,405,805 =========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current maturities of long-term debt $64,922 $55,887 Other current liabilities 103,732 85,717 ----------- ----------- Total current liabilities 168,654 141,604 Long-term debt 568,232 579,466 Other liabilities 286,862 267,652 Liabilities of discontinued aviation operations 23,404 Stockholders' equity 1,441,955 1,393,679 ----------- ----------- TOTAL $2,465,703 $2,405,805 =========== =========== ROWAN COMPANIES, INC. CONSOLIDATED STATEMENT OF OPERATIONS Unaudited (In Thousands Except Per Share Amounts)

THREE MONTHS ENDED MARCH 31, ----------------------- 2005 2004 ----------- ----------- REVENUES: Drilling services $169,643 $105,689 Manufacturing sales and services 62,113 43,703 ----------- ----------- Total 231,756 149,392 ----------- ----------- COSTS AND EXPENSES: Drilling services 96,701 88,418 Manufacturing sales and services 56,670 38,794 Depreciation and amortization 19,913 18,984 Selling, general and administrative 13,260 9,097 Gain on sale of boat purchase options (20,866) ----------- ----------- Total 165,678 155,293 ----------- ----------- INCOME (LOSS) FROM OPERATIONS 66,078 (5,901) ----------- ----------- OTHER INCOME (EXPENSE): Interest expense (5,856) (5,065) Less: interest capitalized 771 797 Interest income 2,546 660 Gain on sale of investments 7,701 Other - net 336 84 ----------- ----------- OTHER INCOME (EXPENSE) - NET 5,498 (3,524) ----------- ----------- INCOME (LOSS) BEFORE INCOME TAXES 71,576 (9,425) Provision (credit) for income taxes 26,980 (3,044) ----------- ----------- INCOME (LOSS) FROM CONTINUING OPERATIONS 44,596 (6,381) Loss from discontinued aviation operations, net of tax (1,174) (4,927) ----------- ----------- NET INCOME (LOSS) $43,422 $(11,308) =========== =========== PER SHARE AMOUNTS: Income (loss) from continuing operations $0.41 $(0.06) =========== =========== Loss from discontinued aviation operations, net of tax $(0.01) $(0.05) =========== =========== Net income (loss) $0.40 $(0.11) =========== =========== AVERAGE DILUTED SHARES 109,252 102,132 =========== =========== ROWAN COMPANIES, INC. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS Unaudited (In Thousands)

THREE MONTHS ENDED MARCH 31 ----------------------- 2005 2004 ----------- ----------- CASH PROVIDED BY (USED IN): Operations: Net income (loss) $43,422 $(11,308) Adjustments to reconcile net income (loss) to net cash provided by (used in) operations: Depreciation and amortization 19,913 23,525 Deferred income taxes 23,094 (5,661) Contributions to pension plans (60,931) (137) Other - net 6,387 9,481 Net changes in current assets and liabilities (37,274) (1,781) Net changes in other noncurrent assets and liabilities 35 65 ----------- ----------- Net cash provided by (used in) operations (5,354) 14,184 ----------- -----------

Investing activities: Property, plant and equipment additions (32,274) (47,777) Proceeds from disposals of property, plant and equipment 816 4,487 ----------- ----------- Net cash used in investing activities (31,458) (43,290) ----------- -----------

Financing activities: Proceeds from borrowings 12,589 29,726 Repayments of borrowings (18,707) (18,707) Payment of cash dividends (26,935) Proceeds from stock option and convertible debenture plans 12,466 1,302 Proceeds from common stock offering, net of issue costs 264,993 ----------- ----------- Net cash provided by (used in) financing activities (20,587) 277,314 ----------- -----------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (57,399) 248,208 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 465,977 58,227 ----------- ----------- CASH AND CASH EQUIVALENTS, END OF PERIOD $408,578 $306,435 =========== ===========

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CONTACT: Rowan Companies, Inc., Houston William C. Provine, 713-960-7575 www.rowancompanies.com

KEYWORD: TEXAS INDUSTRY KEYWORD: OIL/GAS MINING/METALS MANUFACTURING ENERGY EARNINGS SOURCE: Rowan Companies, Inc.

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