Hercules Offshore Announces Third Quarter 2007 Earnings (2)

Headquartered in Houston, Hercules Offshore, Inc. currently operates a fleet of 33 jackup rigs, 27 barge rigs, 65 liftboats, three submersible rigs, nine land rigs, one platform rig and a fleet of marine support vessels operated through a wholly owned subsidiary, and has operations in ten different countries on four continents. The company offers a range of services to oil and gas producers to meet their needs during drilling, well service, platform inspection, maintenance, and decommissioning operations in shallow waters.

For more information, please visit our website at http://www.herculesoffshore.com.

The news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are subject to a number of risks, uncertainties and assumptions, including the factors described in Hercules Offshore's most recent periodic reports and other documents filed with the Securities and Exchange Commission, which are available free of charge at the SEC's website at http://www.sec.gov or the company's website at http://www.herculesoffshore.com. Hercules cautions you that forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those projected or implied in these statements.

    
                HERCULES OFFSHORE, INC. AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS
                          (In thousands)
           (All amounts in US dollars unless otherwise noted)
    
                                              September 30,     December 31,
                                                  2007              2006
                                               (unaudited)
    ASSETS
      Current Assets:
        Cash and Cash Equivalents                   $80,052          $72,772
        Restricted Cash                               4,592              250
        Marketable Securities                        19,850              -
        Accounts Receivable                         265,746           89,136
        Insurance Claims Receivable                  25,472              -
        Supplies                                      5,917              -
        Prepaids                                     49,710           14,438
        Current Deferred Tax Asset                   12,395              -
        Other                                         9,935            3,627
                                                    473,669          180,223
    
      Property and Equipment, Net                 2,178,443          415,864
      Goodwill                                      929,294              -
      Other Assets, Net                              55,145            9,494
    
                                                 $3,636,551         $605,581
    
    LIABILITIES AND STOCKHOLDERS' EQUITY
      Current Liabilities:
        Short-term Debt and Current      
         Portion of Long-term Debt                  $12,152           $1,400
        Insurance Note Payable                       30,180            6,058
        Accounts Payable                            101,805           29,123
        Accrued Liabilities                          64,740           16,262
        Taxes Payable                                11,352            8,745
        Interest Payable                             15,388            2,105
        Other Current Liabilities                    14,187            5,633
                                                    249,804           69,326
    
      Long-term Debt, Net of Current Portion        905,003           91,850
      Other Liabilities                              19,873            6,700
      Deferred Income Taxes                         480,930           42,854
    
      Commitments and Contingencies
    
      Stockholders' Equity                        1,980,941          394,851
    
                                                 $3,636,551         $605,581

                     HERCULES OFFSHORE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except per share data)
                                   (Unaudited)
    
                                       Three Months Ended  Nine Months Ended  
                                         September 30,       September 30,
                                         2007     2006      2007      2006
    
    Revenues                           $294,365  $97,212  $503,873  $229,642
    
    Costs and Expenses:
      Operating Expenses, Excluding  
       Depreciation and Amortization    143,902   33,197   229,825    81,393
      Depreciation and Amortization      39,581    9,097    63,520    22,582
      General and Administrative,    
       Excluding Depreciation and          
       Amortization                      18,018    7,209    36,516    20,396
                                        201,501   49,503   329,861   124,371
    
    Operating Income                     92,864   47,709   174,012   105,271
    
    Other Income (Expense)
      Interest Expense                  (15,761)  (2,575)  (19,230)   (6,824)
      Gain on Disposal of Assets            -      1,110       -      30,690
      Loss on Early Retirement of Debt   (1,312)     -      (2,182)      -
      Other, Net                          2,507      874     5,028     2,697
    
    Income Before Income Taxes           78,298   47,118   157,628   131,834
    Income Tax Provision                (29,927) (17,439)  (52,400)  (48,310)
    
    Net Income                          $48,371  $29,679  $105,228   $83,524
    
    
    Earnings Per Share:
      Basic                               $0.59    $0.93     $2.15     $2.68
      Diluted                             $0.58    $0.91     $2.12     $2.61
    Weighted Average Shares Outstanding:
      Basic                              82,663   31,786    48,912    31,146
      Diluted                            83,418   32,545    49,568    31,959

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