Parker Drilling Reports Corrected 2013 Second Quarter Results

HOUSTON, Aug. 6, 2013 /PRNewswire/ -- Parker Drilling Company (NYSE: PKD), an international drilling services and rental tools provider, today issued a correction to its previously announced earnings report for the quarter ended June 30, 2013.  This corrected report reflects additional non-routine expense of $2.5 million for the second quarter related to the April 2013 acquisition of International Tubular Services Limited (ITS) and certain affiliates.  The effect of this expense, net of the related income tax benefit, reduced the company's net income as previously reported by $1.7 million, or $0.01 per diluted share, for the quarter ended June 30, 2013.

(Logo: http://photos.prnewswire.com/prnh/20050620/PARKERDRILLINGLOGO)

As a result of this change, Parker Drilling reported $8.3 million in net income and $0.07 per diluted share on revenues of $226.0 million for the quarter.  This change is associated with non-routine expenses associated with the ITS acquisition. Net income and earnings per share, when adjusted for these non-routine expenses, remained at $17.3 million and $0.14 per diluted share. Adjusted EBITDA, excluding non-routine expenses, remained at $71.4 million.

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 that address activities, events or developments that 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 rig utilization and dayrates; 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; capital expenditures; expansion and growth opportunities; acquisitions or joint ventures; asset sales; successful negotiation and execution of contracts; scheduled delivery of drilling rigs for operation; the strengthening of the Company's financial position; increases in market share; outcomes of legal proceedings and investigations; 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 that 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 that could adversely affect market conditions, fluctuations in oil and natural gas prices that could reduce the demand for drilling services, changes in laws or government regulations that could adversely affect the cost of doing business, our ability to refinance our debt and other important factors that could cause actual results to differ materially from those projected as described in the Company's reports filed with the Securities and Exchange Commission. See "Risk Factors" in the Company's Annual Report filed on Form 10-K 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 high-performance contract drilling solutions, rental tools and project management services to the energy industry. Parker Drilling's active rig fleet includes 21 land rigs and one offshore barge rig in international locations, 12 barge rigs in the U.S. Gulf of Mexico, and two land rigs in Alaska. The Company's rental tools business supplies premium equipment and well services to operators on land and offshore in the U.S. and international markets. Parker Drilling also performs contract drilling for customer-owned rigs and provides technical services addressing drilling challenges for E&P customers worldwide. More information about Parker Drilling can be found on the Company's website including operating status reports for the Company's U.S. Rental Tools business and its international and U.S. Gulf of Mexico rig fleets, updated monthly.



PARKER DRILLING COMPANY

Consolidated Condensed Balance Sheets

(Dollars in Thousands)



June 30, 2013


June 30, 2013


June 30, 2013




As Previously
Announced


Adjustments


As Corrected


December 31, 2012


(Unaudited)


(Unaudited)


(Unaudited)



ASSETS








CURRENT ASSETS








Cash and Cash Equivalents

$         69,608


$                   -


$         69,608


$                  87,886

Accounts and Notes Receivable, Net

251,440


-


251,440


168,562

Rig Materials and Supplies

39,229


-


39,229


28,860

Deferred Costs

10,822


-


10,822


1,089

Deferred Income Taxes

16,411


-


16,411


8,742

Assets Held for Sale

8,656


-


8,656


6,800

Other Current Assets

33,540


-


33,540


46,345

   TOTAL CURRENT ASSETS

429,706


-


429,706


348,284









PROPERTY, PLANT AND EQUIPMENT, NET

852,813


-


852,813


789,123









OTHER ASSETS








Deferred Income Taxes

107,771


186


107,957


95,295

Other Assets

46,061


-


46,061


23,031

   TOTAL OTHER ASSETS

153,832


186


154,018


118,326









TOTAL ASSETS

$    1,436,351


$               186


$    1,436,537


$             1,255,733









LIABILITIES AND STOCKHOLDERS' EQUITY








CURRENT LIABILITIES








Current  Portion of Long-Term Debt

$         10,000


$                   -


$         10,000


$                  10,000

Accounts Payable and Accrued Liabilities

174,205


1,899


176,104


141,866

   TOTAL CURRENT LIABILITIES

184,205


1,899


186,104


151,866









LONG-TERM DEBT

589,229


-


589,229


469,205









LONG-TERM DEFERRED TAX LIABILITY

31,306


-


31,306


20,847









OTHER LONG-TERM LIABILITIES

22,661


-


22,661


23,182









TOTAL CONTROLLING INTEREST IN STOCKHOLDERS' EQUITY

606,940


(1,713)


605,227


591,404

Noncontrolling interest

2,010


-


2,010


(771)

TOTAL EQUITY

608,950


(1,713)


607,237


590,633









TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$    1,436,351


$               186


$    1,436,537


$             1,255,733

















Current Ratio

2.33




2.31


2.29









Total Debt as a  Percent of Capitalization

50%




50%


45%









Book Value Per Common Share

$              5.06




$              5.04


$                      4.97



PARKER DRILLING COMPANY

Consolidated Statement Of Operations

(Dollars in Thousands, Except Per Share Data)

(Unaudited)












Three Months Ended June 30, 


Three Months Ended
March 31,


2013


2013


2013





As Previously Announced


Adjustments


As Corrected


2012


2013











REVENUES:

$       226,001


$                -


$       226,001


$      178,925


$                      167,155











EXPENSES:










Operating Expenses

143,549


-


143,549


104,526


117,046

Depreciation and Amortization

32,280


-


32,280


27,959


29,512






-





TOTAL OPERATING GROSS MARGIN

50,172


-


50,172


46,440


20,597











General and Administrative Expense

(19,853)


(2,525)


(22,378)


(7,420)


(12,883)

Gain on Disposition of Assets, Net

517


-


517


1,368


1,148






-





TOTAL OPERATING INCOME 

30,836


(2,525)


28,311


40,388


8,862






-





OTHER INCOME AND (EXPENSE):










Interest Expense

(10,741)


-


(10,741)


(8,925)


(10,006)

Interest Income

2,203


-


2,203


53


59

Loss on extinguishment of debt

-


-


-


(1,649)


-

Change in fair value of derivative positions

17


-


17


38


37

Other 

(183)


-


(183)


20


116

TOTAL OTHER EXPENSE

(8,704)


-


(8,704)


(10,463)


(9,794)






-





INCOME (LOSS) BEFORE INCOME TAXES

22,132


(2,525)


19,607


29,925


(932)






-





INCOME TAX EXPENSE (BENEFIT)

12,045


(812)


11,233


9,817


(1,504)






-





NET INCOME (LOSS)

10,087


(1,713)


8,374


20,108


572

Less: net income (loss) attributable to noncontrolling interest

93


-


93


25


(20)

NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST

$           9,994


$       (1,713)


$           8,281


$        20,083


$                             592





















EARNINGS  PER SHARE - BASIC 










Net Income (loss)

$              0.08




$              0.07


$            0.17


$                            0.00











EARNINGS PER SHARE - DILUTED










Net Income (loss)

$              0.08




$              0.07


$            0.17


$                            0.00











NUMBER OF COMMON SHARES USED IN COMPUTING EARNINGS PER SHARE










Basic 

119,483,780




119,483,780


117,410,212


118,867,678

Diluted

121,860,011




121,860,011


118,526,879


120,072,574



PARKER DRILLING COMPANY

Consolidated Statement Of Operations

(Dollars in Thousands, Except Per Share Data)

(Unaudited)










Six Months Ended June 30,


2013


2013


2013




As Previously
Announced


Adjustments


As Corrected


2012









REVENUES:

$       393,156


$                -


$       393,156


$      355,494









EXPENSES:








Operating Expenses

260,595


-


260,595


199,458

Depreciation and Amortization

61,792


-


61,792


55,578


322,387


-


322,387


255,036

TOTAL OPERATING GROSS MARGIN

70,769


-


70,769


100,458









General and Administrative Expense

(32,736)


(2,525)


(35,261)


(12,917)

Gain on Disposition of Assets, Net

1,665


-


1,665


1,860









TOTAL OPERATING INCOME 

39,698


(2,525)


37,173


89,401









OTHER INCOME AND (EXPENSE):








Interest Expense

(20,747)


-


(20,747)


(16,962)

Interest Income

2,251


-


2,251


79

Loss on extinguishment of debt

-


-


-


(1,649)

Change in fair value of derivative positions

54


-


54


(11)

Other 

(56)


-


(56)


36

TOTAL OTHER EXPENSE

(18,498)


-


(18,498)


(18,507)









INCOME (LOSS) BEFORE INCOME TAXES

21,200


(2,525)


18,675


70,894









INCOME TAX EXPENSE (BENEFIT)

10,541


(812)


9,729


24,460









NET INCOME (LOSS)

10,659


(1,713)


8,946


46,434









Less: net income (loss) attributable to noncontrolling interest

73


-


73


(41)

NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST

$         10,586


$       (1,713)


$           8,873


$        46,475

















EARNINGS  PER SHARE - BASIC 

$              0.09




$              0.07


$            0.40









EARNINGS PER SHARE - DILUTED

$              0.09




$              0.07


$            0.39









NUMBER OF COMMON SHARES USED IN COMPUTING
EARNINGS PER SHARE
















Basic 

119,177,431




119,177,431


117,129,364

Diluted

121,498,223




121,498,223


118,623,037



PARKER DRILLING COMPANY

Selected Financial Data

(Dollars in Thousands)

(Unaudited)














Three Months Ended


Six Months Ended June 30,



June 30,


March 31,





2013


2012


2013


2013


2012










REVENUES:









Rental Tools

$   82,022


$   65,002


$    57,082


$ 139,105


$ 131,286


U.S. Barge Drilling

38,301


33,292


29,865


68,165


61,127


U.S. Drilling

17,910


-


11,635


29,545


-


International Drilling

83,182


76,923


64,650


147,832


155,673


Technical Services

4,586


3,708


3,923


8,509


7,408


  Total Revenues

226,001


178,925


167,155


393,156


355,494












OPERATING EXPENSES:











Rental Tools

43,675


22,552


24,875


68,550


44,182


U.S. Barge Drilling

18,290


18,792


17,441


35,732


35,932


U.S. Drilling

14,270


533


11,309


25,578


999


International Drilling

62,855


58,683


59,854


122,709


110,926


Technical Services

4,459


3,966


3,567


8,026


7,419


  Total Operating Expenses

143,549


104,526


117,046


260,595


199,458












OPERATING GROSS MARGIN:











Rental Tools

38,347


42,450


32,207


70,555


87,104


U.S. Barge Drilling

20,011


14,500


12,424


32,433


25,195


U.S. Drilling

3,640


(533)


326


3,967


(999)


International Drilling

20,327


18,240


4,796


25,123


44,747


Technical Services

127


(258)


356


483


(11)


Depreciation and Amortization 

(32,280)


(27,959)


(29,512)


(61,792)


(55,578)


  Total Operating Gross Margin 

50,172


46,440


20,597


70,769


100,458



PARKER DRILLING COMPANY

Adjusted EBITDA 

(Dollars in Thousands)
















Three Months Ended


June 30, 2013


June 30, 2013


June 30, 2013










As Previously Announced


Adjustments


As Corrected


March 31, 2013


December 31, 2012


September 30, 2012


June 30, 2012















Net Income (Loss) Attributable to Controlling Interest

$         9,994


$        (1,713)


$         8,281


$               592


$              (20,098)


$                 10,936


$       20,083

  Adjustments:














   Income Tax (Benefit) Expense

12,045


(812)


11,233


(1,504)


2,724


6,695


9,817

   Interest Expense

10,741


-


10,741


10,006


8,409


8,171


8,925

   Other Income and Expense

(2,037)


-


(2,037)


(212)


717


42


1,538

   Gain on Disposition of Assets, Net

(517)


-


(517)


(1,148)


492


(606)


(1,368)

   Depreciation and Amortization

32,280


-


32,280


29,512


27,660


29,779


27,959















Adjusted EBITDA

62,506


(2,525)


59,981


37,246


19,904


55,017


66,954















Adjustments:














     Non-routine Items

8,865


2,525


11,390


3,463


15,921


564


42















Adjusted EBITDA after Non-routine Items

$       71,371


$                -


$       71,371


$          40,709


$                35,825


$                 55,581


$       66,996

SOURCE Parker Drilling Company



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