Quantitative and Qualitative Disclosures About Market Risk
−Removed: Interest rate risk —We are exposed to interest rate risk, primarily associated with our long-term debt, including current maturities.
−Removed: The following table presents the scheduled installment amounts and related weighted-average interest rates of our long-term debt instruments by contractual maturity date.
−Removed: The scheduled installment amounts include the contractual principal and interest payments resulting from previously restructured debt.
+Added: Overview —We are exposed to interest rate risk, primarily associated with our long-term debt, including current maturities.
+Added: Additionally, we are exposed to equity price risk related to certain of our exchangeable bonds and currency exchange rate risk related to our international operations.
+Added: Interest rate risk —The following table presents the scheduled installment amounts and related weighted-average interest rates of our long-term debt instruments by contractual maturity date.
+Added: The expected maturity amounts, presented below, include both principal and other installments.
The following table presents information as of December 31, 2023, for each of the five years in the period ending December 31, 2028 and thereafter (in millions, except interest rate percentages):
−Removed: Twelve months ending December 31,
+Added: Years ended December 31,
Fixed rate (USD)
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During the year ended December 31, 2023, the fair value of our debt increased by $896 million due to the following:
−Removed: (a) an increase of $469 million due to changes in the market prices of our outstanding debt, (b) an increase of $407 million due to borrowings under shipyard loans established to finance a portion of the final installments due upon delivery of Deepwater Atlas and Deepwater Titan and (c) a net increase of $388 million due to the issuance of the 4.625% Senior Guaranteed Exchangeable Bonds in private exchanges for a portion of the 0.50% Exchangeable Senior Bonds and the 7.25% Senior Notes and the sale of new securities, partially offset by (d) a decrease of $468 million due to scheduled repayments and (e) a decrease of $44 million due to early retirement.
−Removed: See Notes to Consolidated Financial Statements— Note 8—Debt .
+Added: (a) an increase of $2.05 billion due to the issuance of the 8.375% senior secured notes due February 2028, 8.00% senior secured notes due September 2028 and the 8.75% senior secured notes due February 2030, (b) a net increase of $817 million resulting from changes in the market prices of our outstanding debt, partially offset by (c) a decrease of $1.36 billion due to early retirement of certain notes, (d) a decrease of $380 million due to the exchange of the 2.50% senior guaranteed exchangeable bonds due January 2027 and partial exchanges of the 4.00% senior guaranteed exchangeable bonds due December 2025 and the 4.625% senior guaranteed exchangeable bonds due September 2029 (the “4.625% Senior Guaranteed Exchangeable Bonds”) and (e) a decrease of $225 million due to scheduled installments.
+Added: See Notes to Consolidated Financial Statements— Note 9—Debt and Notes to Consolidated Financial Statements— Note 19—Risk Concentration .
The majority of our cash equivalents is subject to variable interest rates or short-term interest rates and such cash equivalents earn commensurately higher rates of return when interest rates increase.
+Added: Equity price risk —We are exposed to equity price risk primarily related to the bifurcated compound exchange feature contained within the 4.625% Senior Guaranteed Exchangeable Bonds.
+Added: The compound exchange feature must be bifurcated from the host debt instrument since it is not considered indexed to our stock.
+Added: The market price of our shares is the primary driver of the fair value of the exchange feature.
+Added: At December 31, 2023, the fair value of the bifurcated compound exchange feature was $350 million.
+Added: At December 31, 2023, a 10 percent hypothetical increase or decrease to the market price of our shares would result in a $43 million increase or decrease in the carrying amount of the exchange feature, recorded as a component of our debt, and a corresponding adjustment to interest expense.
+Added: See Notes to Consolidated Financial Statements— Note 9—Debt and Notes to Consolidated Financial Statements— Note 19—Risk Concentration .
Currency exchange rate risk —We are exposed to currency exchange rate risk primarily related to contract drilling revenues, employee compensation costs and purchasing costs that are denominated in currencies other than our functional currency, the U.S.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.