NABORS INDUSTRIES LTD. HAMILTON, Bermuda, July 22, 2014 /PRNewswire/ -- Nabors Industries Ltd. (NYSE:NBR) today reported its financial results for the second quarter of 2014. Operating revenues and earnings from unconsolidated affiliates for this quarter totaled $1.62 billion, compared to $1.50 billion in the same quarter of the prior year and $1.59 billion in the first quarter of 2014. Net income from continuing operations was $65.7 million or $0.21 per diluted share, compared to $28.1 million or $0.08 per diluted share in the second quarter of 2013 and $49.0 million or $0.16 per diluted share in the first quarter of 2014. The second quarter earnings per share include net charges of $0.03 per share, primarily related to losses on the sale of non-core assets or in unconsolidated businesses in the process of being divested.
Tony Petrello, Nabors' Chairman, President & CEO, commented, "Operationally, our second quarter represented solid improvement in all of our larger segments, partially offset by the usual seasonal weakness in Canada and Alaska. Our U.S. land operations led the way with improved pricing and a significant increase in rig activity. Completion & Production Services recovered sharply with fewer interruptions and improving pricing and utilization. Our International results also improved as the initial contribution of new rig startups more than compensated for the temporary suspension of several existing rigs.
"Strategically, we achieved a major objective through the signing of a definitive agreement with C&J Energy Services to combine their operations with our Completion & Production Services segment to form a leading oilfield services provider with increased critical mass, broader geographic presence and strong international potential. I view this as one of those rare transactions where both companies' shareholders stand to benefit in ways other than just strong accretion potential. The combination of this segment of our business with a well-respected management team enables us to better concentrate our resources on bolstering our position as a preeminent global drilling company, while retaining the emerging upside of those operations. Similarly, C&J immediately multiplies the size and breadth of its business, greatly expands its opportunity set, and inherits a highly capable operating team. We anticipate the closing of the transaction to occur in the fourth quarter.
"Notably, in the second quarter we received long-term contract awards for an additional eight PACE(®)-X rigs in the U.S. market. We continue to see strong demand for new rigs, both domestically and internationally, leading us to significantly increase our new rig production schedule. We also completed the sale of four of our non-core U.S. Offshore rigs and entered into a definitive agreement to divest our Alaska oil and gas holdings. In the aggregate these transactions are expected to yield nearly $100 million in cash proceeds."
Operating cash flow (EBITDA) was $416.3 million for the second quarter, compared to $355.8 million in the same quarter last year and $391.2 million in the first quarter of this year. Adjusted income from operating activities was $133.5 million, compared to $89.6 million in the second quarter of 2013 and $109.0 million in the first quarter of 2014.
Drilling & Rig Services
Operating income in the Drilling & Rig Services business line was down approximately $5.7 million sequentially at $149.8 million. This unit also saw a similar decrease in operating cash flow, which was $376.8 million. These represent modest decreases considering the normal seasonal decrease in Canada and Alaska, approximating $40 million in the second quarter. The quarter's operating income reflects a 50% increase over the same period of last year, illustrating the strength of demand for rigs across virtually all global regions.
In North America, U.S. Drilling results showed substantial improvement in sequential income at $90.0 million despite seasonally lower results in Alaska. This improvement was largely attributable to increases in both utilization and pricing in the Lower 48 operation that amounted to 11 rigs and $600 in daily rig margins. The outlook remains strong with growing pad rig demand, particularly in the Permian and South Texas, as indicated by the award of eight additional PACE(®)-X rigs. This brings the total number of PACE(®)-X rig commitments to 34 and covers all new-builds scheduled to be deployed into early next year. AC rig utilization remains high at 95% with only one rig on standby revenue versus 11 rigs two quarters ago.
Activity in Alaska is expected to be less seasonal going forward, with increases in year-round work expected through 2016 and further upside from pending new rig awards. Near-term Gulf of Mexico offshore activity is expected to be slower with the onset of hurricane season. However, the intermediate term will benefit from the commencement of a large new deepwater platform drilling rig around the end of this year.
International operating income of $50.6 million continued to improve sequentially as the initial contribution from several new startups more than compensated for a temporarily lower rig count in a few areas. Jackup rig 660 returned to work mid-quarter, but its contribution was offset by unanticipated downtime on two other smaller jackups which are expected to return to operations in the near future. As anticipated, two platform rigs in India and six land rigs in Mexico were down for most of the quarter but have good prospects to return to work. The Company's bullish outlook for the near and intermediate term remains intact as new rig deployments accelerate and rates increase with contract renewals, further bolstered by the potential for additional new rig awards.
Rig Services' operating income was $9.1 million, representing a sizable improvement in Canrig and Ryan which was partially offset by a loss in an unconsolidated affiliate. Canrig's backlog increased to an all-time high, roughly half of which is third-party related.
Completion & Production Services
The Completion & Production Services business line recorded operating income of $29.3 million, with operating cash flow of $85.9 million. Although the second quarter was still impacted by weather and other utilization interruptions, including sand supply, results rebounded sharply from the weather-induced weakness of the first quarter. The sequential improvements in operating income amount to $33.1 million in completion operations and $2.7 million in U.S. Production Services despite key customer budget reductions in California. These improvements were partially offset by a $3.4 million sequential decrease in Canada due to the spring breakup. The outlook for the completions business has improved markedly in a relatively short time as increases in demand, particularly in West and South Texas, have increased utilization to a high level. Today this operation's pumping calendar is fully committed into early next year, including a second 45,000 HHP dual-fuel spread which will deploy in early fourth quarter. Price increases are being implemented in the more active markets with further price increases agreed to take effect shortly in all other regions outside of the northeast. These increases, along with continuing cost reductions, suggest a significant improvement over the balance of this year and a strong 2015. The long-term demographics for Production Services continue to indicate a strengthening market despite some near-term pockets of weakness.
Financial Discussion
Earnings per share for the second quarter included several items that had a net impact of $0.03 cents per diluted share. During the quarter the Company disposed of several non-core assets--barges and other rigs--that generated losses of $0.02 per share. In addition, the development of the C&J transaction led the company to redeem at a loss preferred shares relating to the Superior Well Services acquisition, with an unfavorable impact of $0.01 per share. Finally, the unconsolidated Alaska construction business, which is in the process of being divested, yielded a loss of $0.01 during the quarter. These items were all partially offset by income tax benefits related to the filing of 2013 tax returns in a foreign jurisdiction.
SG&A for the second quarter of $133.6 million was in line with the first quarter with a slight sequential reduction of $0.6 million. Higher investment income on the sale of certain financial assets was essentially offset by a similar increase in foreign-exchange losses. The effective tax rate during the quarter was 13.8%, primarily reflecting the above-mentioned benefits. Capital expenditures of $458 million for the quarter were below forecast and largely associated with the construction of new and upgraded rigs. Nonetheless, expenditures for the full-year should reach the upper end of prior guidance of $1.8 billion with the additional PACE(®)-X rigs and the potential for additional international awards yet this year.
William Restrepo, Nabors' Chief Financial Officer added, "We are pleased with the progress made during this quarter and the confirmation of the trends we highlighted during our first quarter conference call. Specifically, the C&J transaction together with the sale of several rigs and E&P assets clearly demonstrate our commitment to focus our resources on those businesses where we are able to generate attractive returns on capital and that are strategically aligned with our areas of strength. Further, the profitability improvement initiatives are well under way. We are starting to see their impact on our financial results and in the cost of building our rigs. And finally, the market has improved as we expected, with higher fracturing service intensity and incremental demand for higher specification drilling assets. During the second half of the year, we expect these favorable trends to contribute to further improvement and to boost the impact of the expected acceleration in international rig deployments."
Summary and Outlook
Petrello concluded, "It is becoming increasingly apparent that virtually every element of our business is experiencing improving fundamentals manifested through improving utilization and pricing. Construction of the numerous new rigs we have in progress remains on track and within budget. The contribution of these deployments combined with a favorable pricing environment across every market and the incremental demand for new rigs globally yield a high degree of growth visibility for the foreseeable future. We are particularly optimistic about the growth prospects for our venture with C&J in the Completion & Production Services business."
About Nabors
The Nabors companies own and operate approximately 496 land drilling rigs throughout the world and approximately 544 land workover and well servicing rigs in North America. Nabors' actively marketed offshore fleet consists of 36 platform rigs in the United States and multiple international markets. In addition, Nabors is one of the largest providers of hydraulic fracturing, cementing, nitrogen and acid pressure pumping services with approximately 800,000 hydraulic horsepower currently in service. Nabors also manufactures top drives and drilling instrumentation systems. Nabors participates in most of the significant oil and gas markets in the world.
The information above 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 certain risks and uncertainties, as disclosed by Nabors from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, Nabors' actual results may differ materially from those indicated or implied by such forward-looking statements. The projections contained in this release reflect management's estimates as of the date of the release. Nabors does not undertake to update these forward-looking statements.
MEDIA CONTACT:
Dennis A. Smith, Director of Corporate Development & Investor Relations, +1 281-775-8038. To request investor materials, contact Nabors' corporate headquarters in Hamilton, Bermuda at +441-292-1510 or via e-mail at mark.andrews@nabors.com
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
Three Months Ended Six Months Ended
------------------ ----------------
June 30, March 31, June 30,
-------- --------- --------
(In thousands, except per
share amounts) 2014 2013 2014 2014 2013
---- ---- ---- ---- ----
Revenues and other income:
Operating revenues $1,616,981 $1,457,966 $1,589,618 $3,206,599 $2,993,444
Earnings (losses) from
unconsolidated affiliates (576) 1,360 (2,445) (3,021) 4,255
Investment income (loss) 7,066 14,821 980 8,046 94,242
Total revenues and other
income 1,623,471 1,474,147 1,588,153 3,211,624 3,091,941
--------- --------- --------- --------- ---------
Costs and other deductions:
Direct costs 1,066,495 972,310 1,061,739 2,128,234 1,967,302
General and administrative
expenses 133,630 131,202 134,266 267,896 262,080
Depreciation and amortization 282,820 266,210 282,127 564,947 535,575
Interest expense 46,303 60,273 44,810 91,113 120,284
Losses (gains) on sales and
disposals of long-lived
assets and other expense
(income), net 16,504 9,242 1,476 17,980 68,979
Total costs and other
deductions 1,545,752 1,439,237 1,524,418 3,070,170 2,954,220
--------- --------- --------- --------- ---------
Income (loss) from continuing
operations before income
taxes 77,719 34,910 63,735 141,454 137,721
------ ------ ------ ------- -------
Income tax expense (benefit) 10,756 6,032 14,008 24,764 15,886
Subsidiary preferred stock
dividend 1,234 750 750 1,984 1,500
----- --- --- ----- -----
Income (loss) from continuing
operations, net of tax 65,729 28,128 48,977 114,706 120,335
Income (loss) from
discontinued operations, net
of tax (1,032) (26,873) 1,515 483 (19,862)
------ ------- ----- --- -------
Net income (loss) 64,697 1,255 50,492 115,189 100,473
Less: Net (income) loss
attributable to
noncontrolling interest (253) (5,616) (573) (826) (5,713)
Net income (loss) attributable
to Nabors $64,444 $(4,361) $49,919 $114,363 $94,760
------- ------- ------- -------- -------
Earnings (losses) per share:
(1)
Basic from continuing
operations $.21 $.08 $.16 $.37 $.41
Basic from discontinued
operations - (.09) .01 - (.09)
--- ---- --- --- ----
Basic $.21 $(.01) $.17 $.37 $.32
Diluted from continuing
operations $.21 $.08 $.16 $.37 $.41
Diluted from discontinued
operations - (.09) - - (.09)
--- ---- --- --- ----
Diluted $.21 $(.01) $.16 $.37 $.32
Weighted-average number of
common shares outstanding:
(1)
Basic 297,984 294,747 296,210 297,097 293,217
------- ------- ------- ------- -------
Diluted 300,981 297,119 299,050 300,016 295,644
------- ------- ------- ------- -------
Adjusted EBITDA (2) $416,280 $355,814 $391,168 $807,448 $768,317
======== ======== ======== ======== ========
Adjusted income (loss) derived
from operating activities (3) $133,460 $89,604 $109,041 $242,501 $232,742
======== ======= ======== ======== ========
(1) See "Computation of Earnings (Losses)
Per Share" included herein as a
separate schedule.
(2) Adjusted EBITDA is computed by
subtracting the sum of direct costs
and general and administrative
expenses from the sum of Operating
revenues and Earnings (losses) from
unconsolidated affiliates. There are
limitations inherent in using
adjusted EBITDA as a measure of
overall profitability because it
excludes significant expense items.
However, management evaluates the
performance of our business units
and the consolidated company based
on several criteria, including
adjusted EBITDA and adjusted income
(loss) derived from operating
activities, because we believe that
these financial measures accurately
reflect our ongoing profitability.
These amounts should not be used as
a substitute for the amounts
reported in accordance with GAAP. To
compensate for the limitations in
utilizing adjusted EBITDA as an
operating measure, management also
uses GAAP measures of performance,
including income from continuing
operations and net income, to
evaluate performance, but only with
respect to the Company as a whole
and not on a segment basis. A
reconciliation of this non-GAAP
measure to income (loss) from
continuing operations before income
taxes, which is a 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".
(3) Adjusted income (loss) derived from
operating activities is computed by
subtracting the sum of direct costs,
general and administrative expenses
and depreciation and amortization
from the sum of Operating revenues
and Earnings (losses) from
unconsolidated affiliates. These
amounts should not be used as a
substitute for those amounts
reported in accordance with GAAP.
However, management evaluates the
performance of our business units
and the consolidated company based
on several criteria, including
adjusted income (loss) derived from
operating activities, because it
believes that these financial
measures accurately reflect our
ongoing profitability. A
reconciliation of this non-GAAP
measure to income (loss) from
continuing operations before income
taxes, which is a 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".
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
----------
June 30, March 31, December 31,
(In thousands, except
ratios) 2014 2014 2013
---- ---- ----
ASSETS
Current assets:
Cash and short-term
investments $486,344 $424,767 $507,133
Accounts receivable,
net 1,448,511 1,454,368 1,399,543
Assets held for sale 233,163 231,880 243,264
Other current assets 642,620 580,253 603,890
------- ------- -------
Total current assets 2,810,638 2,691,268 2,753,830
Long-term investments
and other receivables 2,724 2,915 3,236
Property, plant and
equipment, net 8,832,966 8,690,759 8,597,813
Goodwill 512,897 512,391 512,964
Investment in
unconsolidated
affiliates 60,509 63,069 64,260
Other long-term assets 216,265 226,671 227,708
Total assets $12,435,999 $12,187,073 $12,159,811
=========== =========== ===========
LIABILITIES AND EQUITY
Current liabilities:
Current debt $207 $5,296 $10,185
Other current
liabilities 1,319,379 1,232,846 1,301,239
--------- --------- ---------
Total current
liabilities 1,319,586 1,238,142 1,311,424
Long-term debt 3,956,290 3,812,476 3,904,117
Other long-term
liabilities 1,078,201 1,095,998 893,905
--------- --------- -------
Total liabilities 6,354,077 6,146,616 6,109,446
Subsidiary preferred
stock (1) - 69,188 69,188
Equity:
Shareholders' equity 6,071,426 5,960,469 5,969,086
Noncontrolling
interest 10,496 10,800 12,091
------ ------ ------
Total equity 6,081,922 5,971,269 5,981,177
Total liabilities and
equity $12,435,999 $12,187,073 $12,159,811
=========== =========== ===========
(1) Represents subsidiary
preferred stock from
acquisition in September
2010. All 75,000 outstanding
shares were redeemed in June
2014.
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) 2014 2013 2014 2014 2013
---- ---- ---- ---- ----
Reportable segments:
Operating revenues and
Earnings (losses) from
unconsolidated affiliates:
Drilling and Rig Services:
U.S. $532,894 $467,129 $510,476 $1,043,370 $951,902
Canada 54,861 64,789 111,621 166,482 191,656
International 391,251 351,421 375,069 766,320 672,937
Rig Services (1) 161,740 118,120 143,726 305,466 252,351
------- ------- ------- ------- -------
Subtotal Drilling and Rig
Services (2) 1,140,746 1,001,459 1,140,892 2,281,638 2,068,846
Completion and Production
Services:
Completion Services 276,639 254,016 227,899 504,538 516,154
Production Services 258,378 244,602 275,400 533,778 496,173
------- ------- ------- ------- -------
Subtotal Completion and
Production Services (3) 535,017 498,618 503,299 1,038,316 1,012,327
Other reconciling items (4) (59,358) (40,751) (57,018) (116,376) (83,474)
------- ------- ------- -------- -------
Total operating revenues and
earnings (losses) from
unconsolidated affiliates $1,616,405 $1,459,326 $1,587,173 $3,203,578 $2,997,699
========== ========== ========== ========== ==========
Adjusted EBITDA: (5)
Drilling and Rig Services:
U.S. $206,061 $178,799 $187,637 $393,698 $363,658
Canada 14,216 18,067 40,119 54,335 63,598
International 139,336 117,491 137,991 277,327 224,005
Rig Services (1) 17,176 2,273 16,491 33,667 11,607
------ ----- ------ ------ ------
Subtotal Drilling and Rig
Services (2) 376,789 316,630 382,238 759,027 662,868
Completion and Production
Services:
Completion Services 27,614 33,479 (6,654) 20,960 80,203
Production Services 58,267 48,036 60,056 118,323 99,154
------ ------ ------ ------- ------
Subtotal Completion and
Production Services (3) 85,881 81,515 53,402 139,283 179,357
Other reconciling items (6) (46,390) (42,331) (44,472) (90,862) (73,908)
------- ------- ------- ------- -------
Total adjusted EBITDA $416,280 $355,814 $391,168 $807,448 $768,317
======== ======== ======== ======== ========
Adjusted income (loss) derived
from operating activities:
(7)
Drilling and Rig Services:
U.S. $89,977 $69,813 $72,494 $162,471 $147,408
Canada 225 3,895 26,160 26,385 34,413
International 50,583 32,481 48,119 98,702 53,950
Rig Services (1) 9,059 (5,383) 8,728 17,787 (4,096)
----- ------ ----- ------ ------
Subtotal Drilling and Rig
Services (2) 149,844 100,806 155,501 305,345 231,675
Completion and Production
Services:
Completion Services (581) 6,870 (33,635) (34,216) 24,626
Production Services 29,889 23,471 30,591 60,480 49,485
------ ------ ------ ------ ------
Subtotal Completion and
Production Services (3) 29,308 30,341 (3,044) 26,264 74,111
Other reconciling items (6) (45,692) (41,543) (43,416) (89,108) (73,044)
------- ------- ------- ------- -------
Total adjusted income (loss)
derived from operating
activities $133,460 $89,604 $109,041 $242,501 $232,742
======== ======= ======== ======== ========
Rig activity:
Rig years: (8)
U.S. 215.3 195.8 206.6 211.0 192.8
Canada 21.6 17.4 43.8 32.6 28.6
International (9) 127.3 125.2 129.8 128.6 124.0
Total rig years 364.2 338.4 380.2 372.2 345.4
===== ===== ===== ===== =====
Rig hours: (10)
U.S. Production Services 210,750 224,681 209,982 420,732 436,979
Canada Production Services 28,671 28,802 41,540 70,211 76,829
Total rig hours 239,421 253,483 251,522 490,943 513,808
======= ======= ======= ======= =======
(1) Includes our drilling technology and
top drive manufacturing, directional
drilling, rig instrumentation and
software services. These services
represent our other companies that
are not aggregated into a reportable
operating segment.
(2) Includes earnings (losses), net from
unconsolidated affiliates, accounted
for using the equity method, of
($.8) million, $1.2 million and
($2.5) million for the three months
ended June 30, 2014 and 2013 and
March 31, 2014, respectively and
($3.3) million and $4.0 million for
the six months ended June 30, 2014
and 2013, respectively.
(3) Includes earnings (losses), net from
unconsolidated affiliates, accounted
for using the equity method, of $.2
million, $.2 million and $.1 million
for the three months ended June 30,
2014 and 2013 and March 31, 2014,
respectively and $.3 million for
each of the six months ended June
30, 2014 and 2013.
(4) Represents the elimination of inter-
segment transactions.
(5) Adjusted EBITDA is computed by
subtracting the sum of direct costs
and general and administrative
expenses from the sum of Operating
revenues and Earnings (losses) from
unconsolidated affiliates. There are
limitations inherent in using
adjusted EBITDA as a measure of
overall profitability because it
excludes significant expense items.
However, management evaluates the
performance of our business units
and the consolidated company based
on several criteria, including
adjusted EBITDA and adjusted income
(loss) derived from operating
activities, because we believe that
these financial measures accurately
reflect our ongoing profitability.
These amounts should not be used as
a substitute for the amounts
reported in accordance with GAAP. To
compensate for the limitations in
utilizing adjusted EBITDA as an
operating measure, management also
uses GAAP measures of performance,
including income from continuing
operations and net income, to
evaluate performance, but only with
respect to the Company as a whole
and not on a segment basis. A
reconciliation of this non-GAAP
measure to income (loss) from
continuing operations before income
taxes, which is a 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 the elimination of inter-
segment transactions and unallocated
corporate expenses.
(7) Adjusted income (loss) derived from
operating activities is computed by
subtracting the sum of direct costs,
general and administrative expenses
and depreciation and amortization
from the sum of Operating revenues
and Earnings (losses) from
unconsolidated affiliates. These
amounts should not be used as a
substitute for the amounts reported
in accordance with GAAP. However,
management evaluates the performance
of our business units and the
consolidated company based on
several criteria, including adjusted
income (loss) derived from operating
activities, because it believes that
these financial measures accurately
reflect our ongoing profitability. A
reconciliation of this non-GAAP
measure to income (loss) from
continuing operations before income
taxes, which is a 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".
(8) Excludes well-servicing rigs, which
are measured in rig hours. Includes
our equivalent percentage ownership
of rigs owned by unconsolidated
affiliates. Rig years represent a
measure of the number of equivalent
rigs operating during a given
period. For example, one rig
operating 182.5 days during a 365-
day period represents 0.5 rig years.
(9) International rig years includes our
equivalent percentage ownership of
rigs owned by unconsolidated
affiliates, which totaled 2.5 years
during each of the three months
ended June 30, 2014 and 2013 and
March 31, 2014 and 2.5 years for
each of the six months ended June
30, 2014 and 2013.
(10) Rig hours represents the number of
hours that our well-servicing rig
fleet operated during the period.
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
(Unaudited)
Three Months Ended Six Months Ended
------------------ ----------------
June 30, March 31, June 30,
-------- --------- --------
(In thousands) 2014 2013 2014 2014 2013
---- ---- ---- ---- ----
Adjusted EBITDA $416,280 $355,814 $391,168 $807,448 $768,317
Less: Depreciation and
amortization 282,820 266,210 282,127 564,947 535,575
Adjusted income (loss)
derived from operating
activities 133,460 89,604 109,041 242,501 232,742
------- ------ ------- ------- -------
Interest expense (46,303) (60,273) (44,810) (91,113) (120,284)
Investment income (loss) 7,066 14,821 980 8,046 94,242
Gains (losses) on sales
and disposals of long-
lived assets and other
income (expense), net (16,504) (9,242) (1,476) (17,980) (68,979)
Income (loss) from
continuing operations
before income taxes $77,719 $34,910 $63,735 $141,454 $137,721
======= ======= ======= ======== ========
NABORS INDUSTRIES LTD. AND SUBSIDIARIES
COMPUTATION OF EARNINGS (LOSSES) PER SHARE
(Unaudited)
A reconciliation of the numerators and denominators of the basic and diluted earnings (losses) per share computations is as follows:
Three Months Ended Six Months Ended
------------------ ----------------
June 30, March 31, June 30,
-------- --------- --------
(In thousands, except per
share amounts) 2014 2013 2014 2014 2013
---- ---- ---- ---- ----
Net income (loss) attributable
to Nabors (numerator):
Income (loss) from continuing
operations, net of tax $65,729 $28,128 $48,977 $114,706 $120,335
Less: Net (income) loss
attributable to
noncontrolling interest (253) (5,616) (573) (826) (5,713)
Less: Earnings allocated to
unvested shareholders (974) (814) (733) (1,707) -
Less: Redemption of preferred
shares (1,688) - - (1,688) -
------ --- --- ------ ---
Adjusted income (loss) from
continuing operations -basic
and diluted $62,814 $21,698 $47,671 $110,485 $114,622
Income (loss) from
discontinued operations, net
of tax (1,032) (26,873) 1,515 483 (19,862)
$61,782 $(5,175) $49,186 $110,968 $94,760
------- ------- ------- -------- -------
Earnings (losses) per share:
Basic from continuing
operations $.21 $.08 $.16 $.37 $.41
Basic from discontinued
operations - (.09) .01 - (.09)
Total Basic $.21 $(.01) $.17 $.37 $.32
---- ----- ---- ---- ----
Diluted from continuing
operations $.21 $.08 $.16 $.37 $.41
Diluted from discontinued
operations - (.09) - - (.09)
Total Diluted $.21 $(.01) $.16 $.37 $.32
---- ----- ---- ---- ----
Shares (denominator):
Weighted-average number of
shares outstanding-basic 297,984 294,747 296,210 297,097 293,217
Net effect of dilutive stock
options, warrants and
restricted stock awards based
on the if-converted method 2,997 2,372 2,840 2,919 2,427
Weighted-average number of
shares outstanding - diluted 300,981 297,119 299,050 300,016 295,644
------- ------- ------- ------- -------
For all periods presented, the
computation of diluted earnings
(losses) per share excluded
outstanding stock options and
warrants with exercise prices
greater than the average market
price of Nabors' common shares
because their inclusion would
have been anti-dilutive and
because they were not
considered participating
securities. The average number
of options and warrants that
were excluded from diluted
earnings (losses) per share
that would have potentially
diluted earnings (losses) per
share were 5,782,273 and
11,578,175 shares during the
three months ended June 30,
2014 and 2013, respectively;
7,853,509 shares during the
three months ended March 31,
2014; and 6,817,891 and
12,015,219 shares during the
six months ended June 30, 2014
and 2013, respectively. In any
period during which the average
market price of Nabors' common
shares exceeds the exercise
prices of these stock options
and warrants, such stock
options and warrants are
included in our diluted
earnings (losses) per share
computation using the if-
converted method of accounting.
Restricted stock is included
in our basic and diluted
earnings (losses) per share
computation using the two-
class method of accounting in
all periods because such stock
is considered a participating
security.
SOURCE Nabors Industries Ltd.
