Parker Drilling Reports Corrected 2013 Second Quarter Results

News provided by

Parker Drilling Company

Aug 06, 2013, 08:00 ET

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