HAMILTON, Bermuda, July 28, 2020 /PRNewswire/ -- Nabors
Industries Ltd. ("Nabors" or the "Company") (NYSE: NBR) today
reported second quarter 2020 operating revenues of $534 million compared to operating revenues of
$718 million in the first quarter of
2020. The net loss from continuing operations attributable to
Nabors common shareholders for the quarter is expected to be
$152 million, or $22.13 per share, compared to a loss of
$395 million, or $56.72 per share in the prior quarter. After-tax
charges in the second quarter are expected to be $54 million, or $7.68 per share, primarily related to asset
impairments and severance costs. After-tax charges in the first
quarter totaled $260 million, or
$36.86 per share.
For the second quarter, adjusted EBITDA was $154 million compared to $188 million in the prior quarter. In the U.S., a
50% decline in Lower 48 rig count for the industry drove a 36%
reduction in Nabors' drilling rigs, as well as a sharp decline in
Nabors Drilling Solutions. International activity, especially in
Latin America, was impacted by
COVID-related disruptions, which resulted in significantly lower
dayrates for our temporarily idled rigs. In addition, several
contracts were not renewed or were terminated before their
expiration. The Rig Technologies segment recorded its highest
quarterly adjusted EBITDA level in five years, due to stronger
sales in international markets and stringent expense control. Total
overhead was reduced by $30 million,
a 25% sequential decrease. Second-quarter results also benefitted
from one-time net gains to adjusted EBITDA of approximately
$8 million, primarily revenue from
early terminations on drilling contracts for the International
segment.
Anthony G. Petrello, Nabors
Chairman, CEO and President, commented, "As we adjusted to the
steep activity decline, Nabors delivered strong results in the
second quarter, driven by increased market share and strong margins
in the Lower 48, resilience in our International business and
improved results in our Rig Technologies segment. In addition, we
slashed our overhead expenses and capital spending, while making
notable progress on our priorities to generate free cash flow and
reduce net debt. At the same time, our global team remains focused
on minimizing the impact of the pandemic on our employees and on
our operations.
"The second quarter operating performance reflected significant
activity declines in North
America, as operators completed the bulk of their plans to
reduce drilling. In the U.S. Lower 48, we lowered our costs swiftly
in response to customer actions. Our daily rig margins remained at
high levels despite some weakening in our average dayrates for the
fleet.
"In our International Drilling segment, rig count declined by
4.3 rigs, a 5% reduction. In addition to the situation in
Venezuela, where our main customer
exited the market, various customers responded to the global drop
in demand by adjusting their drilling plans. As well, strict COVID
lockdowns in Latin America
resulted in reduced dayrates during the lockdown periods.
Nonetheless, adjusted EBITDA held up well, as we benefitted from
significant early termination revenue.
"Although activity in the Lower 48 seems close to a bottom, the
full impact of pricing reductions on average fleet margins still
lies ahead. In addition, as is usually the case, activity trends in
most international markets lag the U.S. We expect international rig
count and pricing to continue falling over the remainder of the
year, though not as steeply as the industry has experienced in the
Lower 48.
"In this environment, we will remain focused on cost and capital
discipline. We will ensure our direct and overhead costs, as well
as our capital expenditures, are as aligned as much as possible to
our activity levels."
Consolidated and Segment Results
The U.S. Drilling segment reported $77.7
million in adjusted EBITDA for the second quarter of 2020, a
$24.1 million, or 24%, reduction from
the prior quarter, primarily due to the decline in activity in the
Lower 48 market. During the quarter, Nabors' Lower 48 rig count
decreased by 31.8 rigs or 36%. Average daily margins in the Lower
48 widened to $10,449 as favorable
cost performance offset the erosion to average fleet dayrates. The
U.S. segment's rig count currently stands at 55, with 49 rigs in
the Lower 48. Based on the Company's current outlook, the third
quarter average Lower 48 rig count should fall by two to three rigs
from the second quarter exit rate of 49, while drilling margins
should fall to between $9,000 and
$9,500, reflecting more normal costs
and the continued impact of lower pricing.
International Drilling adjusted EBITDA increased sequentially by
$2.0 million, to $93.5 million. Activity declines across several
markets and disruptions related to the COVID-19 virus impacted
results. The second quarter included one-time net gains totaling
approximately $8 million, primarily
early termination revenue. The quarterly average rig count, at 82,
declined by 5% from the prior quarter. Average margin per day
increased to $14,091, including a net
benefit of approximately $1,070 from
the unusual items. The international rig count currently stands at
74. The Company's outlook includes a further reduction in average
rig count in the third quarter, and a decline in adjusted
EBITDA.
Canada Drilling reported an adjusted EBITDA loss of $0.6 million, as rig activity in that market
reached its seasonal low point. Average daily gross margin and the
average working rig count decreased significantly during the
quarter. The second quarter rig count was two rigs, down from 17 in
the prior quarter. The usual seasonal downturn was exacerbated by
the current market environment. For the third quarter of 2020, the
Company expects an improvement in this segment's adjusted EBITDA as
seasonal activity picks up. The Company anticipates rig count to
improve by four rigs in the third quarter.
In Drilling Solutions, adjusted EBITDA of $9.4 million declined sharply compared to the
first quarter, due to reduced activity across service lines and
heightened price competition. The industry rig count, which dropped
significantly more than the Nabors rig count, hurt this segment's
U.S. revenue as compared to the reduction in the Company's U.S.
drilling rig activity.
In the Rig Technologies segment, second quarter adjusted EBITDA
was $3.2 million, reversing the prior
quarter adjusted EBITDA loss of $3.2
million. Higher international sales and strict cost control
contributed to the improved results.
Cost Reductions and Capital Discipline
The second quarter results reflect several actions taken by the
Company to improve its fixed cost structure. Primarily, these
measures include a streamlined corporate organization, reduced
compensation, and a field-support infrastructure optimized for the
lower level of activity. Combined, the Company estimates that these
actions should generate savings of $96
million beginning in the second quarter through the end of
2020. This reduction represents an additional $11 million in savings as compared to the amount
communicated at the end of the first quarter.
Capital expenditures were $49
million in the second quarter, and totaled $109 million for the first half of 2020. As
previously disclosed, the Company expects capital expenditures
of approximately $240
million for the full year.
Free cash flow, defined as net cash provided by operating
activities less net cash used by investing activities, as presented
in our cash flow statement, reached $101
million in the second quarter. Total debt declined by
$112 million and net debt, defined
for financial reporting purposes as total debt less cash, cash
equivalents and short-term investments, declined to $2.78 billion, a $117
million reduction. The improvement in free cash flow as
compared to the first quarter was driven by the absence of
semiannual interest payments on senior notes during the second
quarter and lower capital expenditures. Working capital provided a
headwind to the Company's cash flow. In Latin America, collections were affected by
the COVID lockdowns and by negotiations on the dayrates for the
lockdown periods. Collections globally were well below Nabors'
expectations.
William Restrepo, Nabors CFO,
stated, "Nabors' adjusted EBITDA and cash generation, despite the
adverse environment, demonstrated the Company's resilience. Looking
ahead, we expect further deterioration in the domestic and
international markets. As such, we have increased our efforts to
continue delivering our goals. We remain committed to meaningfully
reduce our net debt in 2020.
"Our overhead costs were cut significantly below the
first-quarter levels, exceeding our initial targets. G&A,
R&E and field support expenses totaled $89.1 million in the second quarter as compared
to $118.9 million in the prior
quarter, a 25% reduction. We expect those costs to fall just below
$80 million in the third quarter and
remain at those levels in the fourth, a 33% reduction as compared
to the first quarter. The full year 2020 should be $145 million dollars below the prior year, a 28%
year-on-year reduction.
"During the second quarter, we purchased approximately
$187 million of our shorter-term
notes in the open market at a discount to par. The remaining
balances of our 2020 and 2021 senior notes now stand at
$139 million and $154 million, respectively. At June 30, our balances of cash and cash
equivalents plus our undrawn credit facility totaled nearly
$925 million."
Mr. Petrello concluded, "Our commitment to generate free cash
flow and reduce net debt this year is unwavering. We continue to
evaluate all aspects of the Company with the goal of streamlining
our operating processes.
"We will continue to drive technology and performance in the
drilling sector. We firmly believe that the future of our industry
and the Company's success will be determined by our ability to
continue automating the drilling process and integrating the
relevant services onto our leading-edge rig platform. At the same
time, we are positioning the Company to capitalize on several
far-reaching transformations which are currently underway in our
industry. The recent launch of our RigCloud® digital
platform, for streaming analytics and improving rig and operational
performance, is a key element of our digitalization strategy. These
initiatives will allow us to further improve performance, enhance
placement and quality of the wellbore, reduce well cost and enable
remote operations with fewer people at risk on the well site.
"We spent the last several years focusing our value proposition
on the group of operators we thought most capable of sustaining
scale in their markets. These operators demand industry-leading rig
capabilities, performance, and advanced technology. Our track
record across these dynamics has established Nabors as the leading
provider of drilling services to these customers. This strong
position will serve us well as we emerge from this downturn.
"I would again like to thank our employees for their hard work
in this trying environment. I remain confident that their
commitment and perseverance will be rewarded in the recovery."
About Nabors
Nabors (NYSE: NBR) owns and operates one of the world's largest
land-based drilling rig fleets and provides offshore platform rigs
in the United States and several
international markets. Nabors also provides directional drilling
services, tubular services, performance software, and innovative
technologies for its own rig fleet and those of third parties.
Leveraging advanced drilling automation capabilities, Nabors highly
skilled workforce continues to set new standards for operational
excellence and transform the industry.
Forward-looking Statements
The information included in this press release includes
forward-looking statements within the meaning of the Securities Act
of 1933 and the Securities Exchange Act of 1934. Such
forward-looking statements are subject to a number of risks and
uncertainties, as disclosed by Nabors from time to time in its
filings with the Securities and Exchange Commission. The
results included in this press release are preliminary and
unaudited and are subject to change and finalization based on the
completion of the Company's normal quarter-end procedures,
particularly as it relates to impairments and valuations or
reserves around the carrying value of various assets on our balance
sheet. As a result, these preliminary results may be
materially different than the actual results reflected on the
Company's Form 10-Q, when it is filed. We do not expect there
to be any differences in revenues, adjusted EBITDA, adjusted
operating income (loss), free cash flow or net debt, or any of the
rig activity or daily rig financial information, but there could be
material differences to net loss from continuing operations
attributable to Nabors common shareholders and earning per
share.
The preliminary results and forward-looking statements contained
in this press release reflect management's estimates and beliefs as
of the date of this press release. Nabors does not undertake
to update these forward-looking statements.
Non-GAAP Disclaimer
This press release may present certain "non-GAAP" financial
measures. The components of these non-GAAP measures are
computed by using amounts that are determined in accordance with
accounting principles generally accepted in the United States of America ("GAAP").
Adjusted operating income (loss) represents income (loss) from
continuing operations before income taxes, interest expense,
earnings (losses) from unconsolidated affiliates, investment income
(loss), impairments and other charges and other, net. Adjusted
EBITDA is computed similarly, but also excludes depreciation and
amortization expenses. In addition, adjusted EBITDA and adjusted
operating income (loss) exclude certain cash expenses that the
Company is obligated to make. Net debt is calculated as total debt
minus the sum of cash, cash equivalents and short-term investments.
Free cash flow represents net cash provided by operating
activities less cash used for investing activities. Free cash flow
is an indicator of our ability to generate cash flow after required
spending to maintain or expand our asset base. Management believes
that this non-GAAP measure is useful information to investors when
comparing our cash flows with the cash flows of other companies.
Each of these non-GAAP measures has limitations and therefore
should not be used in isolation or as a substitute for the amounts
reported in accordance with GAAP. However, management evaluates the
performance of its operating segments and the consolidated Company
based on several criteria, including adjusted EBITDA, adjusted
operating income (loss), net debt, and free cash flow, because it
believes that these financial measures accurately reflect the
Company's ongoing profitability and performance. Securities
analysts and investors also use these measures as some of the
metrics on which they analyze the Company's performance. Other
companies in this industry may compute these measures
differently. Reconciliations of consolidated adjusted EBITDA
and adjusted operating income (loss) to income (loss) from
continuing operations before income taxes, net debt to total debt,
and free cash flow to cash flow provided by operations, which are
their nearest comparable GAAP financial measures, are included in
the tables at the end of this press release.
Media Contact: William C.
Conroy, Vice President of Corporate Development &
Investor Relations, +1 281-775-2423, or Kara Peak, Director of Corporate Development
& Investor Relations, +1 281-775-4954. To request
investor materials, contact Nabors' corporate headquarters in
Hamilton, Bermuda at +441-292-1510
or via e-mail mark.andrews@nabors.com
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
PRELIMINARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
(In thousands,
except per share amounts)
|
2020
|
|
2019
|
|
2020
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
Revenues and other
income:
|
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
533,931
|
|
$
771,406
|
|
$
718,364
|
|
$
1,252,295
|
|
$
1,571,046
|
Earnings (losses)
from unconsolidated affiliates
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
Investment income
(loss)
|
2,036
|
|
469
|
|
(3,198)
|
|
(1,162)
|
|
10,146
|
Total revenues and
other income
|
535,967
|
|
771,875
|
|
715,166
|
|
1,251,133
|
|
1,581,187
|
|
|
|
|
|
|
|
|
|
|
Costs and other
deductions:
|
|
|
|
|
|
|
|
|
|
Direct
costs
|
326,557
|
|
496,664
|
|
461,840
|
|
788,397
|
|
1,017,621
|
General and
administrative expenses
|
46,244
|
|
64,415
|
|
57,384
|
|
103,628
|
|
132,582
|
Research and
engineering
|
7,305
|
|
11,920
|
|
11,409
|
|
18,714
|
|
25,440
|
Depreciation and
amortization
|
211,120
|
|
218,319
|
|
227,063
|
|
438,183
|
|
428,710
|
Interest
expense
|
51,206
|
|
51,491
|
|
54,722
|
|
105,928
|
|
103,843
|
Impairments and other
charges
|
57,852
|
|
102,570
|
|
276,434
|
|
334,286
|
|
99,903
|
Other, net
|
(30,795)
|
|
7,899
|
|
(17,110)
|
|
(47,905)
|
|
28,068
|
Total costs and other
deductions
|
669,489
|
|
953,278
|
|
1,071,742
|
|
1,741,231
|
|
1,836,167
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations before income taxes
|
(133,522)
|
|
(181,403)
|
|
(356,576)
|
|
(490,098)
|
|
(254,980)
|
Income tax expense
(benefit)
|
4,446
|
|
11,398
|
|
17,693
|
|
22,139
|
|
41,197
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations, net of tax
|
(137,968)
|
|
(192,801)
|
|
(374,269)
|
|
(512,237)
|
|
(296,177)
|
Income (loss) from
discontinued operations, net of tax
|
23
|
|
(34)
|
|
(93)
|
|
(70)
|
|
(191)
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(137,945)
|
|
(192,835)
|
|
(374,362)
|
|
(512,307)
|
|
(296,368)
|
Less: Net (income)
loss attributable to noncontrolling interest
|
(10,167)
|
|
(10,729)
|
|
(17,465)
|
|
(27,632)
|
|
(24,905)
|
Net income (loss)
attributable to Nabors
|
$(148,112)
|
|
$(203,564)
|
|
$(391,827)
|
|
$
(539,939)
|
|
$
(321,273)
|
Less: Preferred stock
dividend
|
$
(3,653)
|
|
$
(4,312)
|
|
$
(3,652)
|
|
$
(7,305)
|
|
$
(8,625)
|
Net income (loss)
attributable to Nabors common shareholders
|
$(151,765)
|
|
$(207,876)
|
|
$(395,479)
|
|
$
(547,244)
|
|
$
(329,898)
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable
to Nabors common shareholders:
|
|
|
|
|
|
|
|
|
|
Net income (loss)
from continuing operations
|
$(151,788)
|
|
$(207,842)
|
|
$(395,386)
|
|
$
(547,174)
|
|
$
(329,707)
|
Net income (loss)
from discontinued operations
|
23
|
|
(34)
|
|
(93)
|
|
(70)
|
|
(191)
|
Net income (loss)
attributable to Nabors common shareholders
|
$(151,765)
|
|
$(207,876)
|
|
$(395,479)
|
|
$
(547,244)
|
|
$
(329,898)
|
|
|
|
|
|
|
|
|
|
|
Earnings (losses) per
share:
|
|
|
|
|
|
|
|
|
|
Basic from continuing
operations
|
$
(22.13)
|
|
$
(30.31)
|
|
$
(56.72)
|
|
$
(78.85)
|
|
$
(48.43)
|
Basic from
discontinued operations
|
-
|
|
-
|
|
(0.01)
|
|
(0.01)
|
|
(0.03)
|
Total
Basic
|
$
(22.13)
|
|
$
(30.31)
|
|
$
(56.73)
|
|
$
(78.86)
|
|
$
(48.46)
|
|
|
|
|
|
|
|
|
|
|
Diluted from
continuing operations
|
$
(22.13)
|
|
$
(30.31)
|
|
$
(56.72)
|
|
$
(78.85)
|
|
$
(48.43)
|
Diluted from
discontinued operations
|
-
|
|
-
|
|
(0.01)
|
|
(0.01)
|
|
(0.03)
|
Total
Diluted
|
$
(22.13)
|
|
$
(30.31)
|
|
$
(56.73)
|
|
$
(78.86)
|
|
$
(48.46)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
7,052
|
|
7,031
|
|
7,051
|
|
7,052
|
|
7,023
|
Diluted
|
7,052
|
|
7,031
|
|
7,051
|
|
7,052
|
|
7,023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
153,825
|
|
$
198,407
|
|
$
187,731
|
|
$
341,556
|
|
$
395,403
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income (loss)
|
$
(57,295)
|
|
$
(19,912)
|
|
$
(39,332)
|
|
$
(96,627)
|
|
$
(33,307)
|
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
PRELIMINARY
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
(In
thousands)
|
2020
|
|
2020
|
|
2019
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and short-term
investments
|
$
494,278
|
|
$
489,658
|
|
$
452,496
|
Accounts receivable,
net
|
349,005
|
|
454,718
|
|
453,042
|
Assets held for
sale
|
562
|
|
1,936
|
|
2,530
|
Other current
assets
|
309,077
|
|
324,524
|
|
340,598
|
Total current
assets
|
1,152,922
|
|
1,270,836
|
|
1,248,666
|
Property, plant and
equipment, net
|
4,395,725
|
|
4,597,308
|
|
4,930,549
|
Goodwill
|
-
|
|
-
|
|
28,380
|
Other long-term
assets
|
433,768
|
|
440,404
|
|
553,063
|
Total assets
|
$
5,982,415
|
|
$
6,308,548
|
|
$
6,760,658
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Current portion of
debt
|
$
-
|
|
$
-
|
|
$
-
|
Other current
liabilities
|
523,690
|
|
584,870
|
|
656,548
|
Total current
liabilities
|
523,690
|
|
584,870
|
|
656,548
|
Long-term
debt
|
3,276,103
|
|
3,388,014
|
|
3,333,220
|
Other long-term
liabilities
|
241,005
|
|
264,742
|
|
295,333
|
Total liabilities
|
4,040,798
|
|
4,237,626
|
|
4,285,101
|
|
|
|
|
|
|
Redeemable
noncontrolling interest in subsidiary
|
434,131
|
|
429,824
|
|
425,392
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
Shareholders'
equity
|
1,413,147
|
|
1,555,921
|
|
1,982,811
|
Noncontrolling
interest
|
94,339
|
|
85,177
|
|
67,354
|
Total equity
|
1,507,486
|
|
1,641,098
|
|
2,050,165
|
Total liabilities and
equity
|
$
5,982,415
|
|
$
6,308,548
|
|
$
6,760,658
|
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
SEGMENT
REPORTING
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
The following tables
set forth certain information with respect to our reportable
segments and rig activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
(In thousands,
except rig activity)
|
2020
|
|
2019
|
|
2020
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues:
|
|
|
|
|
|
|
|
|
|
|
U.S.
Drilling
|
$ 173,784
|
|
$ 323,402
|
|
$ 274,901
|
|
$
448,685
|
|
$
643,611
|
|
Canada
Drilling
|
3,564
|
|
11,389
|
|
25,591
|
|
29,155
|
|
36,704
|
|
International
Drilling
|
301,078
|
|
326,905
|
|
337,110
|
|
638,188
|
|
664,161
|
|
Drilling
Solutions
|
33,129
|
|
64,583
|
|
55,384
|
|
88,513
|
|
130,005
|
|
Rig Technologies
(1)
|
33,582
|
|
72,751
|
|
42,150
|
|
75,732
|
|
144,504
|
|
Other reconciling
items (2)
|
(11,206)
|
|
(27,624)
|
|
(16,772)
|
|
(27,978)
|
|
(47,939)
|
|
Total operating
revenues
|
$ 533,931
|
|
$ 771,406
|
|
$ 718,364
|
|
$
1,252,295
|
|
$
1,571,046
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA:
(3)
|
|
|
|
|
|
|
|
|
|
|
U.S.
Drilling
|
$
77,659
|
|
$ 124,924
|
|
$ 101,809
|
|
$
179,468
|
|
$
249,929
|
|
Canada
Drilling
|
(564)
|
|
1,069
|
|
7,931
|
|
7,367
|
|
8,515
|
|
International
Drilling
|
93,510
|
|
86,767
|
|
91,509
|
|
185,019
|
|
172,611
|
|
Drilling
Solutions
|
9,411
|
|
22,461
|
|
19,439
|
|
28,850
|
|
43,507
|
|
Rig Technologies
(1)
|
3,176
|
|
3,160
|
|
(3,178)
|
|
(2)
|
|
864
|
|
Other reconciling
items (4)
|
(29,367)
|
|
(39,974)
|
|
(29,779)
|
|
(59,146)
|
|
(80,023)
|
|
Total adjusted
EBITDA
|
$ 153,825
|
|
$ 198,407
|
|
$ 187,731
|
|
$
341,556
|
|
$
395,403
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
U.S.
Drilling
|
$ (23,395)
|
|
$
20,392
|
|
$
(7,404)
|
|
$
(30,799)
|
|
$
45,075
|
|
Canada
Drilling
|
(5,795)
|
|
(5,537)
|
|
37
|
|
(5,758)
|
|
(5,596)
|
|
International
Drilling
|
276
|
|
(6,884)
|
|
(4,147)
|
|
(3,871)
|
|
(12,521)
|
|
Drilling
Solutions
|
1,733
|
|
13,793
|
|
10,549
|
|
12,282
|
|
26,648
|
|
Rig Technologies
(1)
|
(1,492)
|
|
496
|
|
(8,151)
|
|
(9,643)
|
|
(4,652)
|
|
Other reconciling
items (4)
|
(28,622)
|
|
(42,172)
|
|
(30,216)
|
|
(58,838)
|
|
(82,261)
|
|
Total adjusted
operating income (loss)
|
$ (57,295)
|
|
$ (19,912)
|
|
$ (39,332)
|
|
$
(96,627)
|
|
$
(33,307)
|
|
|
|
|
|
|
|
|
|
|
|
Rig
activity:
|
|
|
|
|
|
|
|
|
|
Average Rigs Working:
(6)
|
|
|
|
|
|
|
|
|
|
|
Lower 48
|
57.2
|
|
114.6
|
|
89.0
|
|
73.1
|
|
113.0
|
|
Other US
|
6.6
|
|
7.6
|
|
7.4
|
|
7.0
|
|
8.5
|
|
U.S.
Drilling
|
63.8
|
|
122.2
|
|
96.4
|
|
80.1
|
|
121.5
|
|
Canada
Drilling
|
2.2
|
|
7.4
|
|
16.8
|
|
9.5
|
|
11.8
|
|
International
Drilling
|
82.4
|
|
88.6
|
|
86.7
|
|
84.6
|
|
89.1
|
|
Total average rigs
working
|
148.4
|
|
218.2
|
|
199.9
|
|
174.2
|
|
222.4
|
|
|
|
|
|
|
|
|
|
|
|
Daily Rig
Revenue:
|
|
|
|
|
|
|
|
|
|
|
Lower 48
|
24,744
|
|
25,783
|
|
27,199
|
|
26,238
|
|
25,794
|
|
Other US
|
74,825
|
|
78,922
|
|
80,996
|
|
78,089
|
|
75,588
|
|
U.S. Drilling
(8)
|
29,927
|
|
29,091
|
|
31,339
|
|
30,776
|
|
29,267
|
|
Canada
Drilling
|
18,105
|
|
17,024
|
|
16,767
|
|
16,920
|
|
17,184
|
|
International
Drilling
|
40,129
|
|
40,529
|
|
42,717
|
|
41,456
|
|
41,160
|
|
|
|
|
|
|
|
|
|
|
|
Daily Rig Margin:
(7)
|
|
|
|
|
|
|
|
|
|
|
Lower 48
|
10,449
|
|
10,222
|
|
9,891
|
|
10,110
|
|
10,197
|
|
Other US
|
46,032
|
|
39,760
|
|
43,756
|
|
44,828
|
|
38,965
|
|
U.S. Drilling
(8)
|
14,132
|
|
12,061
|
|
12,497
|
|
13,148
|
|
12,204
|
|
Canada
Drilling
|
899
|
|
3,764
|
|
5,694
|
|
5,146
|
|
5,338
|
|
International
Drilling
|
14,091
|
|
12,610
|
|
13,471
|
|
13,773
|
|
12,616
|
|
|
(1)
|
Includes our oilfield
equipment manufacturing, automated systems, and downhole
tools.
|
|
|
(2)
|
Represents the
elimination of inter-segment transactions related to our Rig
Technologies operating segment.
|
|
|
(3)
|
Adjusted EBITDA
represents income (loss) from continuing operations before income
taxes, interest expense, depreciation and amortization, earnings
(losses) from unconsolidated affiliates, investment income (loss),
impairments and other charges and other, net. Adjusted EBITDA is a
non-GAAP financial measure and should not be used in isolation or
as a substitute for the amounts reported in accordance with GAAP.
In addition, adjusted EBITDA excludes certain cash expenses that
the Company is obligated to make. However, management evaluates the
performance of its operating segments and the consolidated Company
based on several criteria, including adjusted EBITDA and adjusted
operating income (loss), because it believes that these financial
measures accurately reflect the Company's ongoing profitability and
performance. Securities analysts and investors use this
measure as one of the metrics on which they analyze the Company's
performance. Other companies in this industry may compute
these measures differently. A reconciliation of this non-GAAP
measure to income (loss) from continuing operations before income
taxes, which is the most closely comparable GAAP measure, is
provided in the table set forth immediately following the heading
"Reconciliation of Non-GAAP Financial Measures to Income (loss)
from Continuing Operations before Income Taxes".
|
|
|
(4)
|
Represents the
elimination of inter-segment transactions and unallocated corporate
expenses.
|
|
|
(5)
|
Adjusted operating
income (loss) represents income (loss) from continuing operations
before income taxes, interest expense, earnings (losses) from
unconsolidated affiliates, investment income (loss), impairments
and other charges and other, net. Adjusted operating income (loss)
is a non-GAAP financial measure and should not be used in isolation
or as a substitute for the amounts reported in accordance with
GAAP. In addition, adjusted operating income (loss) excludes
certain cash expenses that the Company is obligated to make.
However, management evaluates the performance of its operating
segments and the consolidated Company based on several criteria,
including adjusted EBITDA and adjusted operating income (loss),
because it believes that these financial measures accurately
reflect the Company's ongoing profitability and performance.
Securities analysts and investors use this measure as one of the
metrics on which they analyze the Company's performance.
Other companies in this industry may compute these measures
differently. A reconciliation of this non-GAAP measure to
income (loss) from continuing operations before income taxes, which
is the most closely comparable GAAP measure, is provided in the
table set forth immediately following the heading "Reconciliation
of Non-GAAP Financial Measures to Income (loss) from Continuing
Operations before Income Taxes".
|
|
|
(6)
|
Represents a measure
of the average number of rigs operating during a given
period. For example, one rig operating 45 days during a
quarter represents approximately 0.5 average rigs working for the
quarter. On an annual period, one rig operating 182.5 days
represents approximately 0.5 average rigs working for the
year.
|
|
|
(7)
|
Daily rig margin
represents operating revenue less operating expenses, divided by
the total number of revenue days during the
quarter.
|
|
|
(8)
|
The U.S. Drilling
segment includes the Lower 48, Alaska, and Gulf of Mexico operating
areas.
|
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES TO
|
PRELIMINARY INCOME
(LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME
TAXES
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
(In
thousands)
|
2020
|
|
2019
|
|
2020
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
153,825
|
|
$
198,407
|
|
$
187,731
|
|
$
341,556
|
|
$
395,403
|
Depreciation and
amortization
|
(211,120)
|
|
(218,319)
|
|
(227,063)
|
|
(438,183)
|
|
(428,710)
|
Adjusted operating
income (loss)
|
(57,295)
|
|
(19,912)
|
|
(39,332)
|
|
(96,627)
|
|
(33,307)
|
|
|
|
|
|
|
|
|
|
|
Earnings (losses)
from unconsolidated affiliates
|
-
|
|
-
|
|
-
|
|
-
|
|
(5)
|
Investment income
(loss)
|
2,036
|
|
469
|
|
(3,198)
|
|
(1,162)
|
|
10,146
|
Interest
expense
|
(51,206)
|
|
(51,491)
|
|
(54,722)
|
|
(105,928)
|
|
(103,843)
|
Impairments and other
charges
|
(57,852)
|
|
(102,570)
|
|
(276,434)
|
|
(334,286)
|
|
(99,903)
|
Other, net
|
30,795
|
|
(7,899)
|
|
17,110
|
|
47,905
|
|
(28,068)
|
Preliminary Income
(loss) from continuing operations before income taxes
|
$(133,522)
|
|
$(181,403)
|
|
$(356,576)
|
|
$(490,098)
|
|
$(254,980)
|
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
RECONCILIATION OF
NET DEBT TO TOTAL DEBT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
(In
thousands)
|
2020
|
|
2020
|
|
2019
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Current portion of
debt
|
$
-
|
|
$
-
|
|
$
-
|
Long-term
debt
|
3,276,103
|
|
3,388,014
|
|
3,333,220
|
Total Debt
|
3,276,103
|
|
3,388,014
|
|
3,333,220
|
Less: Cash and
short-term investments
|
494,278
|
|
489,658
|
|
452,496
|
Net Debt
|
$
2,781,825
|
|
$
2,898,356
|
|
$
2,880,724
|
NABORS INDUSTRIES
LTD. AND SUBSIDIARIES
|
RECONCILIATION OF
FREE CASH FLOW TO
|
NET CASH PROVIDED
BY OPERATING ACTIVITIES
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
(In
thousands)
|
2020
|
|
2020
|
|
2020
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
$ 142,610
|
|
$
59,162
|
|
$
201,772
|
Less: Net cash used
for investing activities
|
(41,376)
|
|
(50,773)
|
|
(92,149)
|
Free cash
flow
|
$ 101,234
|
|
$
8,389
|
|
$
109,623
|
|
Free cash flow
represents net cash provided by operating activities less cash used
for investing activities. Free cash flow is an indicator of our
ability to generate cash flow after required spending to maintain
or expand our asset base. Management believes that this non-GAAP
measure is useful information to investors when comparing our cash
flows with the cash flows of other companies. This non-GAAP measure
has limitations and therefore should not be used in isolation or as
a substitute for the amounts reported in accordance with GAAP.
However, management evaluates the performance of the consolidated
Company based on several criteria, including free cash flow,
because it believes that these financial measures accurately
reflect the Company's ongoing profitability and
performance.
|
View original
content:http://www.prnewswire.com/news-releases/nabors-announces-preliminary-second-quarter-2020-results-301101537.html
SOURCE Nabors Industries Ltd.