HOUSTON, May 5, 2015
/PRNewswire/ -- Parker Drilling Company (NYSE-PKD), an
international provider of drilling services and rental tools to the
energy industry, today reported results for the quarter ended
March 31, 2015, including net income of $3.2 million, or $0.03 per diluted share, on revenues of
$204.1 million. First quarter
adjusted EBITDA was $53.4 million,
compared with $65.2 million for the
preceding quarter.
"In the 2015 first quarter, while we experienced significant
declines in our U.S. markets for rental tools and barge drilling
services, we increased our international and Alaska drilling fleet utilization, and
benefited from growth in our international O&M (operations and
maintenance) and project services," said Gary Rich, chairman, president and chief
executive officer. "Our results also reflect the impact of
cost reductions throughout the business.
"Solid cash flow from operations throughout the quarter allowed
us to reduce debt by $30 million and
close the quarter with a strong cash position. During the quarter
we also increased the capacity of our revolving credit facility and
extended its maturity.
"We achieved good operating results and a solid financial
condition by maintaining our clear focus on lowering our cost base,
sustaining our utilization, managing our cash and liquidity, and
preserving our ability to respond when conditions improve. We
reacted quickly and decisively to the severe downturn in drilling
activity that first impacted U.S. drilling markets and has begun to
affect international markets. We are prepared to make further
adjustments to our business to address changing market conditions
and take advantage of opportunities as they occur."
Outlook
"We believe overall energy market conditions will remain weak.
We expect our Rental Tools Services business to continue to be
impacted by the severe downturn in U.S. land and shallow water
offshore drilling markets, with lower utilization and continued
price pressure. This may be moderated by improvements in our
international rental tools operations. Similarly, we expect
our Drilling Services business to continue to be impacted by the
sharp decline in U.S. lower 48 drilling activity, tempered by more
resilient activity in our International & Alaska Drilling
segment, particularly international O&M services and drilling
operations in Alaska," Mr. Rich
added.
First Quarter Review
Parker Drilling's revenues for
the 2015 first quarter, compared with the 2014 fourth quarter,
declined 16 percent to $204.1 million
from $243.2 million, operating gross
margin excluding depreciation and amortization expense (gross
margin) declined 14 percent to $64.8
million from $75.2 million and
gross margin as a percentage of revenues was 31.8 percent, compared
with 30.9 percent for the prior period.
For the Company's Drilling Services business, revenues declined
15 percent to $128.0 million from
$150.8 million, gross margin declined
1 percent to $35.5 million from
$35.9 million, and gross margin as a
percentage of revenues was 27.7 percent, compared with 23.8 percent
for the prior period. The decrease in revenues is primarily
due to the sharp decline in barge drilling activity in the U.S.
Gulf of Mexico inland water
drilling market and a decrease in revenues from reimbursable
expenses.
- U.S. (Lower 48) Drilling revenues were $14.1 million and gross margin was $0.1 million. Both revenues and gross
margin were below 2014 fourth quarter levels, primarily due to
lower utilization and average dayrate for our barge drilling rig
fleet in the U.S. Gulf of Mexico.
- International & Alaska Drilling revenues were $113.9 million, gross margin was $35.4 million, and gross margin as a percentage
of revenues was 31.1 percent. Compared with the 2014 fourth
quarter, revenues decreased 4 percent and gross margin increased 41
percent. The decline in revenues was primarily due to a
decrease in revenues from reimbursable expenses. The increase
in gross margin reflects a greater contribution from O&M and
project activities, the benefit of early termination and
demobilization fees, and operating expense reductions.
Rental Tools Services revenues were $76.1
million, gross margin was $29.3
million and gross margin as a percentage of revenues was
38.5 percent. Compared with the 2014 fourth quarter, revenues
decreased 18 percent and gross margin decreased 25 percent. Reduced
revenues and gross margin were primarily due to the continued
decline in U.S. land and shallow water offshore drilling activity
and the resulting lower demand and stiff price competition for U.S.
rental tools services, as well as softer demand in international
rental tools markets. This was partially offset by lower
operating costs.
General and Administrative Expense increased to $10.8 million for the 2015 first quarter, from
$9.7 million for the 2014 fourth
quarter. The increased expense is primarily due to a one-time gain
in the 2014 fourth quarter from a change in our employee benefit
program and incremental expenses in the 2015 first quarter
associated with implementation of our new ERP system.
Capital expenditures year-to-date through March 31, 2015 were $33.5
million.
"In current market conditions, we believe customers will value,
more than ever, our focus on operational execution and on providing
innovative, reliable and efficient solutions that help them safely
manage their costs and mitigate their risks. We believe we
are in sound condition, prepared to meet the challenges ahead and
capture opportunities that arise," concluded Mr. Rich.
Conference Call
Parker Drilling has scheduled a
conference call for 10:00 a.m. Central
Time (11:00 a.m. Eastern Time)
on Wednesday, May 6, 2015, to review
reported results. The call will be available by telephone at
(888) 523-1228, access code 5566922. The call can also be
accessed through the Investor Relations section of the Company's
website. A replay of the call can be accessed on the
Company's website for 12 months or by telephone for 1 week from
May 6, 2015 at (888) 203-1112, using
the access code 5566922#.
Cautionary Statement
This press release contains certain statements that may be
deemed to be "forward-looking statements" within the meaning of the
Securities Act of 1933 and the Securities Exchange Act of 1934. All
statements in this press release other than statements of
historical facts addressing activities, events or developments the
Company expects, projects, believes, or anticipates will or may
occur in the future are forward-looking statements. These
statements include, but are not limited to, statements about
anticipated future financial or operational results; the outlook
for rental tools utilization and rig utilization and dayrates; the
results of past capital expenditures; scheduled start-ups of rigs;
general industry conditions such as the demand for drilling and the
factors affecting demand; competitive advantages such as
technological innovation; future operating results of the Company's
rigs, rental tools operations and projects under management; future
capital expenditures; expansion and growth opportunities;
acquisitions or joint ventures; asset purchases and sales;
successful negotiation and execution of contracts; scheduled
delivery of drilling rigs or rental equipment for operation; the
Company's financial position; changes in utilization or market
share; outcomes of legal proceedings; compliance with credit
facility and indenture covenants; and similar matters. These
statements are based on certain assumptions made by the Company
based on management's experience and perception of historical
trends, current conditions, anticipated future developments and
other factors believed to be appropriate. Although the Company
believes its expectations stated in this press release are based on
reasonable assumptions, such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
control of the Company, that could cause actual results to differ
materially from those implied or expressed by the forward-looking
statements. These include risks relating to changes in worldwide
economic and business conditions, fluctuations in oil and natural
gas prices, compliance with existing laws and changes in laws or
government regulations, the failure to realize the benefits of, and
other risks relating to, acquisitions, the risk of cost overruns,
our ability to refinance our debt and other important factors, many
of which could adversely affect market conditions, demand for our
services, and costs, and all or any one of which could cause actual
results to differ materially from those projected. For more
information, see "Risk Factors" in the Company's Annual Report
filed on Form 10-K with the Securities and Exchange Commission and
other public filings and press releases. Each forward-looking
statement speaks only as of the date of this press release and the
Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
Company Description
Parker Drilling (NYSE: PKD)
provides drilling services and rental tools to the energy industry.
The Company's Drilling Services business serves operators in the
inland waters of the U.S. Gulf of
Mexico utilizing Parker
Drilling's barge rig fleet and in select international
markets and harsh-environment regions utilizing Parker Drilling-owned and customer-owned
equipment. The Company's Rental Tools Services business supplies
premium equipment and well services to operators on land and
offshore in the U.S. and international markets. More
information about Parker Drilling
can be found on the Company's website at
www.parkerdrilling.com.
PARKER DRILLING
COMPANY
|
Consolidated
Condensed Balance Sheets
|
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
|
|
March 31,
2015
|
|
December 31,
2014
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
CURRENT
ASSETS
|
|
|
|
Cash and Cash
Equivalents
|
$
|
113,199
|
|
|
$
|
108,456
|
|
Accounts and Notes
Receivable, Net
|
279,420
|
|
|
270,952
|
|
Rig Materials and
Supplies
|
50,336
|
|
|
47,943
|
|
Deferred
Costs
|
6,432
|
|
|
5,673
|
|
Deferred Income
Taxes
|
5,648
|
|
|
7,476
|
|
Other Current
Assets
|
28,218
|
|
|
29,279
|
|
TOTAL CURRENT
ASSETS
|
483,253
|
|
|
469,779
|
|
|
|
|
|
PROPERTY, PLANT AND
EQUIPMENT, NET
|
885,233
|
|
|
895,940
|
|
|
|
|
|
OTHER
ASSETS
|
|
|
|
Deferred Income
Taxes
|
135,820
|
|
|
122,689
|
|
Other
Assets
|
36,009
|
|
|
32,251
|
|
TOTAL OTHER
ASSETS
|
171,829
|
|
|
154,940
|
|
|
|
|
|
TOTAL
ASSETS
|
$
|
1,540,315
|
|
|
$
|
1,520,659
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
Current Portion
of Long-Term Debt
|
$
|
—
|
|
|
$
|
10,000
|
|
Accounts Payable and
Accrued Liabilities
|
209,399
|
|
|
168,665
|
|
TOTAL CURRENT
LIABILITIES
|
209,399
|
|
|
178,665
|
|
|
|
|
|
LONG-TERM
DEBT
|
585,000
|
|
|
605,000
|
|
|
|
|
|
LONG-TERM DEFERRED
TAX LIABILITY
|
58,312
|
|
|
52,115
|
|
|
|
|
|
OTHER LONG-TERM
LIABILITIES
|
18,559
|
|
|
18,665
|
|
|
|
|
|
TOTAL CONTROLLING
INTEREST IN STOCKHOLDERS' EQUITY
|
664,868
|
|
|
662,431
|
|
Noncontrolling
interest
|
4,177
|
|
|
3,783
|
|
TOTAL
EQUITY
|
669,045
|
|
|
666,214
|
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$
|
1,540,315
|
|
|
$
|
1,520,659
|
|
|
|
|
|
|
|
|
|
Current
Ratio
|
2.31
|
|
|
2.63
|
|
|
|
|
|
Total Debt as a
Percent of Capitalization
|
47
|
%
|
|
48
|
%
|
|
|
|
|
Book Value Per Common
Share
|
$
|
5.43
|
|
|
$
|
5.43
|
|
PARKER DRILLING
COMPANY
|
Consolidated
Statement Of Operations
|
(Dollars in
Thousands, Except Per Share Data)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Three Months Ended
March 31,
|
|
|
2015
|
|
2014
|
|
2014
|
|
|
|
|
|
|
REVENUES
|
$
|
204,076
|
|
|
$
|
229,225
|
|
|
$
|
243,213
|
|
|
|
|
|
|
|
EXPENSES:
|
|
|
|
|
|
Operating
Expenses
|
139,270
|
|
|
166,025
|
|
|
167,990
|
|
Depreciation and
Amortization
|
40,539
|
|
|
34,337
|
|
|
38,455
|
|
|
179,809
|
|
|
200,362
|
|
|
206,445
|
|
TOTAL OPERATING GROSS
MARGIN
|
24,267
|
|
|
28,863
|
|
|
36,768
|
|
|
|
|
|
|
|
General and
Administrative Expense
|
(10,837)
|
|
|
(8,964)
|
|
|
(9,675)
|
|
Gain (Loss) on
Disposition of Assets, Net
|
2,441
|
|
|
(129)
|
|
|
621
|
|
TOTAL OPERATING
INCOME
|
15,871
|
|
|
19,770
|
|
|
27,714
|
|
|
|
|
|
|
|
OTHER INCOME AND
(EXPENSE):
|
|
|
|
|
|
Interest
Expense
|
(11,078)
|
|
|
(12,039)
|
|
|
(10,779)
|
|
Interest
Income
|
183
|
|
|
32
|
|
|
39
|
|
Loss on
extinguishment of debt
|
—
|
|
|
(29,673)
|
|
|
—
|
|
Other
|
(1,380)
|
|
|
895
|
|
|
1,148
|
|
TOTAL OTHER
EXPENSE
|
(12,275)
|
|
|
(40,785)
|
|
|
(9,592)
|
|
|
|
|
|
|
|
INCOME (LOSS) BEFORE
INCOME TAXES
|
3,596
|
|
|
(21,015)
|
|
|
18,122
|
|
|
|
|
|
|
|
INCOME TAX EXPENSE
(BENEFIT)
|
(182)
|
|
|
(8,623)
|
|
|
9,983
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
3,778
|
|
|
(12,392)
|
|
|
8,139
|
|
Less: net income
attributable to noncontrolling interest
|
556
|
|
|
157
|
|
|
386
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO CONTROLLING INTEREST
|
$
|
3,222
|
|
|
$
|
(12,549)
|
|
|
$
|
7,753
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE - BASIC
|
|
|
|
|
|
Net Income
(loss)
|
$
|
0.03
|
|
|
$
|
(0.10)
|
|
|
$
|
0.06
|
|
|
|
|
|
|
|
EARNINGS PER SHARE -
DILUTED
|
|
|
|
|
|
Net Income
(loss)
|
$
|
0.03
|
|
|
$
|
(0.10)
|
|
|
$
|
0.06
|
|
|
|
|
|
|
|
NUMBER OF COMMON
SHARES USED IN COMPUTING EARNINGS PER SHARE
|
|
|
|
|
|
Basic
|
121,887,072
|
|
|
120,368,650
|
|
|
121,755,421
|
|
Diluted
|
123,708,623
|
|
|
120,368,650
|
|
|
123,295,412
|
|
PARKER DRILLING
COMPANY
|
Selected Financial
Data
|
(Dollars in
Thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
2015
|
|
2014
|
|
2014
|
|
|
|
|
|
|
|
|
REVENUES:
|
|
|
|
|
|
|
|
U.S. (Lower 48)
Drilling
|
|
$
|
14,097
|
|
|
$
|
35,787
|
|
|
$
|
32,124
|
|
|
International &
Alaska Drilling
|
|
113,921
|
|
|
112,932
|
|
|
118,711
|
|
|
Rental
Tools
|
|
76,058
|
|
|
80,506
|
|
|
92,378
|
|
|
Total
Revenues
|
|
$
|
204,076
|
|
|
$
|
229,225
|
|
|
$
|
243,213
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
|
|
|
U.S. (Lower 48)
Drilling
|
|
$
|
13,982
|
|
|
$
|
22,995
|
|
|
$
|
21,369
|
|
|
International &
Alaska Drilling
|
|
78,529
|
|
|
91,275
|
|
|
93,563
|
|
|
Rental
Tools
|
|
46,759
|
|
|
51,755
|
|
|
53,058
|
|
|
Total
Operating Expenses
|
|
$
|
139,270
|
|
|
$
|
166,025
|
|
|
$
|
167,990
|
|
|
|
|
|
|
|
|
|
OPERATING GROSS
MARGIN:
|
|
|
|
|
|
|
|
U.S. (Lower 48)
Drilling
|
|
$
|
115
|
|
|
$
|
12,792
|
|
|
$
|
10,755
|
|
|
International &
Alaska Drilling
|
|
35,392
|
|
|
21,657
|
|
|
25,148
|
|
|
Rental
Tools
|
|
29,299
|
|
|
28,751
|
|
|
39,320
|
|
|
Depreciation and
Amortization
|
|
(40,539)
|
|
|
(34,337)
|
|
|
(38,455)
|
|
|
Total
Operating Gross Margin
|
|
$
|
24,267
|
|
|
$
|
28,863
|
|
|
$
|
36,768
|
|
|
|
|
|
|
|
|
|
PARKER DRILLING
COMPANY
|
Adjusted
EBITDA
|
(Dollars in
Thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2015
|
|
December 31,
2014
|
|
September 30,
2014
|
|
June 30,
2014
|
|
March 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
Attributable to Controlling Interest
|
|
$
|
3,222
|
|
|
$
|
7,753
|
|
|
$
|
12,566
|
|
|
$
|
15,681
|
|
|
$
|
(12,549)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Income Tax (Benefit)
Expense
|
|
(182)
|
|
|
9,983
|
|
|
11,014
|
|
|
11,702
|
|
|
(8,623)
|
|
Interest
Expense
|
|
11,078
|
|
|
10,779
|
|
|
10,848
|
|
|
10,599
|
|
|
12,039
|
|
Other Income and
Expense
|
|
1,197
|
|
|
(1,187)
|
|
|
500
|
|
|
(641)
|
|
|
28,746
|
|
(Gain) Loss on
Disposition of Assets, Net
|
|
(2,441)
|
|
|
(621)
|
|
|
457
|
|
|
(1,019)
|
|
|
129
|
|
Depreciation and
Amortization
|
|
40,539
|
|
|
38,455
|
|
|
36,149
|
|
|
36,180
|
|
|
34,337
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA*
|
|
53,413
|
|
|
65,162
|
|
|
71,534
|
|
|
72,502
|
|
|
54,079
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Non-routine
Items
|
|
—
|
|
|
—
|
|
|
(1,250)
|
|
|
(1,500)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA after
Non-routine Items
|
|
$
|
53,413
|
|
|
$
|
65,162
|
|
|
$
|
70,284
|
|
|
$
|
71,002
|
|
|
$
|
54,079
|
|
|
|
*
|
Adjusted EBITDA, a
non-GAAP financial measure, excludes items that management believes
are of a non-routine nature and which detract from an understanding
of normal operating performance and comparisons with other periods.
Management also believes that results excluding these items are
more comparable to estimates provided by securities analysts and
used by them in evaluating the Company's performance.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/parker-drilling-reports-2015-first-quarter-results-300078232.html
SOURCE Parker Drilling