NABORS INDUSTRIES LTD. 
By HAMILTON, Bermuda, Feb. 18, 2014 /PRNewswire/ -- Nabors Industries Ltd. (NYSE: NBR) today announced its results for the fourth quarter and full year 2013. The Company's net income from continuing operations was $128.5 million ($0.42 per diluted share) in the fourth quarter and $158.3 million ($0.51 per diluted share) for the full year. For the comparable periods of the prior year, the Company reported net income from continuing operations of $131.6 million ($0.45 per diluted share) for the fourth quarter and $232.2 million ($0.79 per diluted share) for the full year. Fourth quarter adjusted income derived from operating activities was $159.6 million, bringing the total for 2013 to $558.2 million. This compares to $153.7 million for the corresponding quarter of 2012 and $907.0 million for all of 2012. Operating cash flow (EBITDA) was $437.2 million for the fourth quarter compared to $427.1 million in the same quarter last year and $439.3 million in the third quarter of 2013. Full-year operating cash flow was $1.64 billion compared to $1.95 billion for 2012. Revenues for 2013 were $1.60 billion for the quarter and $6.15 billion for the full year, compared to $1.57 billion and $6.54 billion, respectively in 2012.
Tony Petrello, Nabors' Chairman and CEO, commented, "The strength of our fourth-quarter results reflects building momentum in our International operations and a more favorable outlook for our U.S. Drilling operations. Our Completion & Production Services operations posted an improvement in what would usually be a seasonally weaker quarter.
"In addition to good operational performance, income benefited from approximately $4.6 million in early contract termination payments and a $9.0 million gain from a bankruptcy settlement, in which we fully recovered our receivables plus interest. Non-operating results were also favorable as quarterly interest expense fell to $47.1 million, which equates to an annualized savings of approximately $60 million relative to a year ago. This sizeable interest savings is a result of our recent debt refinancing and a year-over-year reduction in total debt of nearly $0.5 billion. We also realized a net tax benefit in the quarter resulting from the premium paid with respect to the debt refinancing and favorable tax adjustments in multiple venues.
"Initiatives to enhance our financial position and streamline our operations continued to yield results throughout 2013, despite the challenges imposed by the lower industry rig count and anemic asset valuations. Cumulatively in the seven quarters since the launch of these efforts in the second quarter of 2012, we have:
-- Consistently generated free cash flow.
-- Completed over $700 million in monetization of assets.
-- Initiated an annual dividend of $0.16 per share.
-- Secured contracts for 40 new and 11 upgraded rigs that aggregate to over
140 rig years and $2.8 billion in revenues.
-- Reinvested $1.4 billion in new technology rigs and enhancements with
firm contracts securing attractive returns.
-- Achieved all of the foregoing while reducing net debt by $870 million."
Drilling & Rig Services
Operating income in the Drilling & Rig Services business line was $157.3 million, representing a sequential increase of approximately $25.5 million, adjusted for early termination payments. Operating cash flow of $380.2 million also reflected an adjusted increase of $25.8 million compared to the third quarter. Significant improvements in International, U.S. Drilling and Canada, outpaced a loss in Rig Services where profitability in Canrig was more than offset by losses in two other operations.
International operations showed significant improvement in spite of a flat rig count. This resulted from a further increase in average margins to $15,884 per rig day and surpassing 2008 margins, which was the best year yet for this unit. The increased margins reflect a combination of the full contribution and mix of higher-margin startups, lower rig move results, and further abatement of cost issues in certain markets that have characterized prior periods. The Company expects these costs to further improve, with full mitigation not expected before the end of 2014; however, it continues to anticipate first quarter results to be significantly lower, with more normal rig move results, idle time between contracts for certain high-margin rig operations, and dry-docking of the large Arabian Gulf jackup. Sequential results should begin to improve again in the second quarter and accelerate in the second half driven by the restart of the idle rigs, the previously announced new deployments and contractual rate increases, which are applicable to more than 30 rigs in the next five quarters.
In North America, U.S. Drilling operations improved by an adjusted amount of approximately $12.0 million sequentially. The improvement stemmed from an adjusted increase in average daily rig margins of $400 and three additional rigs working. The adjustments result from early contract termination payments amounting to $4.6 million in the fourth quarter and $34.3 million in the third quarter. The Company expects a flat first quarter with higher costs attributable to payroll taxes followed by an improving year. This favorable outlook is supported by the planned deployment of 20 PACE(®)-X rigs in 2014, firming spot-market pricing, improving activity in Alaska and the late-year commencement of a new high-impact deepwater platform rig. While optimistic about the U.S. land market, the Company still expects a competitive environment as a result of ongoing excess legacy rig capacity, continued productivity gains and competitive speculative new construction.
Rig Services posted a loss in the quarter driven by losses in directional drilling and an Alaska construction joint venture. Canrig was profitable and its back log increased significantly, indicating more favorable results in subsequent quarters.
Completion & Production Services
Operating income in the Completion & Production Services business line was $40.8 million, representing a sequential increase of approximately $1.9 million, in what is customarily a seasonally weaker quarter. Operating cash flow of $96.4 million reflected an increase of $5.6 million compared to the third quarter. The sequential improvement came from both components of this business although Completion Services experienced some late quarter weather effects.
In Production Services, the sequential increase was attributable to higher truck hours that resulted from a fourth quarter acquisition. Rig hours were down eight percent with seasonal effects, partially offset by higher average rates. Improving results in this operation are expected throughout most of 2014, notwithstanding the recent severe weather and second-quarter breakup in Canada. The improving outlook is fueled by the steady increase in the quantity and complexity of oil wells in the U.S. at a time of relatively high industry utilization and a depleting quantity of viable rigs to reactivate.
In Completion Services, sequential results improved modestly with higher utilization in south and west Texas more than offsetting some late-quarter adverse weather in northern operations. The Company now believes pricing in the completion market is stabilizing as a result of a pricing floor imposed by higher maintenance costs associated with the large increase in pumping hours per day. This operation continues to achieve significant reductions in operating and overhead costs. Improvements in profitability are also being realized as a result of the fourth-quarter suspension of a majority of the Company's U.S. coiled tubing operations and the relocation of the Canada stimulation operations to west Texas.
Despite these improvements, the near-term outlook for this operation is substantially lower in the first quarter, primarily as a result of the expiration of the Company's only remaining legacy term contract at the end of 2013. This is exacerbated by excessive downtime associated with the unusually cold weather in its northern operations, which comprise approximately 60 percent of its fleet. Following the difficulties that are plaguing the first quarter, subsequent quarters should improve throughout 2014 as a result of further improvement in costs, increasing utilization and stable-to-improving pricing.
Financial Position:
The Company's financial position continues to improve, with fourth-quarter free cash flow further reducing net debt by $148 million. Net debt now is less than $3.5 billion, with liquidity approximating $1.5 billion. Further progress is anticipated in the near term notwithstanding the capital requirements associated with numerous new rigs under construction.
Summary and Outlook:
Petrello concluded, "Looking forward, we believe 2013 will represent the low point in Nabors' protracted five-year trough. Commencing with the second quarter, we foresee substantial year-over-year quarterly improvement, which should accelerate in the second half. This is supported by our robust international outlook, the ongoing demand for PACE(®)-X rigs, the prospects for near-term increases in US land activity and improving spot pricing, favorable trends in well-servicing and fluids management, and indications of a stabilizing pressure pumping market, although the recent cold weather is having a large adverse near-term impact on that segment. A major factor in our expectation is the outsized contribution of the 140 rig years of long-term rig contracts we have secured over the last 18 months, 90 of which should be realized through 2015 with only 6.7 reflected in our results to date. The gross margin impact of these rigs is more than two and a half times that of an average U.S. land rig as defined by our fourth-quarter average margins. This demonstrates the inherent value of the breadth and quality of Nabors' fleet and global opportunity set that has been elusive over the last few years."
About Nabors
The Nabors companies actively market approximately 490 land drilling rigs throughout the world and approximately 549 land workover and well servicing rigs in North America. Nabors' actively marketed offshore fleet consists of 38 platform rigs, eight jack-up units and four barge 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 and provides comprehensive oilfield hauling, engineering, civil construction, logistics, and facilities maintenance and project management services. Nabors participates in most of the significant oil and gas markets in the world.
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 Year Ended
------------------ ----------
December 31, September 30, December 31,
------------ ------------- ------------
(In thousands, except
per share amounts) 2013 2012 2013 2013 2012
---- ---- ---- ---- ----
Revenues and other income:
Operating revenues $1,606,978 $1,570,552 $1,551,593 $6,152,015 $6,843,051
Earnings (losses) from
unconsolidated
affiliates (1,588) 1,193 (2,628) 39 (301,320)
Investment income
(loss) 1,106 30,293 1,229 96,577 63,137
Total revenues and
other income 1,606,496 1,602,038 1,550,194 6,248,631 6,604,868
--------- --------- --------- --------- ---------
Costs and other deductions:
Direct costs 1,032,841 1,015,182 981,685 3,981,828 4,368,702
General and
administrative
expenses 135,307 129,419 127,943 525,330 527,953
Depreciation and
amortization 277,658 273,482 273,444 1,086,677 1,039,923
Interest expense 47,075 61,836 56,059 223,418 251,904
Losses (gains) on sales and
disposals of long-lived assets
and other expense (income), net
10,732 (158,413) 3,266 37,977 (136,636)
Impairments and other
charges - 142,757 242,241 287,241 290,260
Total costs and other
deductions 1,503,613 1,464,263 1,684,638 6,142,471 6,342,106
--------- --------- --------- --------- ---------
Income (loss) from
continuing operations
before income taxes 102,883 137,775 (134,444) 106,160 262,762
------- ------- -------- ------- -------
Income tax expense
(benefit) (26,383) 5,460 (44,684) (55,181) 27,581
Subsidiary preferred
stock dividend 750 750 750 3,000 3,000
--- --- --- ----- -----
Income (loss) from
continuing
operations, net of
tax 128,516 131,565 (90,510) 158,341 232,181
Income (loss) from
discontinued
operations, net of
tax 23,113 (103,414) (14,430) (11,179) (67,526)
------ -------- ------- ------- -------
Net income (loss) 151,629 28,151 (104,940) 147,162 164,655
Less: Net (income)
loss attributable to
noncontrolling
interest (1,026) (1,074) (441) (7,180) (621)
Net income (loss)
attributable to
Nabors $150,603 $27,077 $(105,381) $139,982 $164,034
-------- ------- --------- -------- --------
Earnings (losses) per share: (1)
Basic from continuing
operations $.43 $.45 $(.30) $.51 $.80
Basic from
discontinued
operations .07 (.36) (.05) (.04) (.23)
--- ---- ---- ---- ----
Basic $.50 $.09 $(.35) $.47 $.57
Diluted from
continuing operations $.42 $.45 $(.30) $.51 $.79
Diluted from
discontinued
operations .08 (.36) (.05) (.04) (.23)
--- ---- ---- ---- ----
Diluted $.50 $.09 $(.35) $.47 $.56
Weighted-average number of common shares outstanding:
(1)
Basic 295,218 290,394 295,076 294,182 289,965
------- ------- ------- ------- -------
Diluted 297,746 292,421 295,076 296,592 292,323
------- ------- ------- ------- -------
Adjusted EBITDA (2) $437,242 $427,144 $439,337 $1,644,896 $1,946,877
======== ======== ======== ========== ==========
Adjusted income (loss)
derived from
operating activities
(3) $159,584 $153,662 $165,893 $558,219 $906,954
======== ======== ======== ======== ========
(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,
general and administrative expenses,
earnings (losses) from our former
U.S. oil and gas joint venture 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,
depreciation and amortization and
earnings (losses) from our former
U.S. oil and gas joint venture 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)
----------
December 31, September 30, December 31,
(In thousands, except
ratios) 2013 2013 2012
---- ---- ----
ASSETS
Current assets:
Cash and short-term
investments $507,133 $491,938 $778,204
Accounts receivable,
net 1,399,543 1,362,434 1,382,623
Assets held for sale 243,264 396,201 383,857
Other current assets 603,890 705,882 588,173
------- ------- -------
Total current assets 2,753,830 2,956,455 3,132,857
Long-term investments
and other receivables 3,236 3,371 4,269
Property, plant and
equipment, net 8,597,813 8,463,804 8,712,088
Goodwill 512,964 479,557 472,326
Investment in
unconsolidated
affiliates 64,260 68,907 61,690
Other long-term assets 227,708 230,022 272,792
Total assets $12,159,811 $12,202,116 $12,656,022
=========== =========== ===========
LIABILITIES AND EQUITY
Current liabilities:
Current debt $10,185 $11,441 $364
Other current
liabilities 1,301,239 1,113,981 1,132,018
--------- --------- ---------
Total current
liabilities 1,311,424 1,125,422 1,132,382
Long-term debt 3,904,117 4,036,027 4,379,336
Other long-term
liabilities 893,905 1,133,886 1,117,999
------- --------- ---------
Total liabilities 6,109,446 6,295,335 6,629,717
Subsidiary preferred
stock (1) 69,188 69,188 69,188
Equity:
Shareholders' equity 5,969,086 5,826,168 5,944,929
Noncontrolling
interest 12,091 11,425 12,188
------ ------ ------
Total equity 5,981,177 5,837,593 5,957,117
Total liabilities and
equity $12,159,811 $12,202,116 $12,656,022
=========== =========== ===========
(1) Represents subsidiary
preferred stock from
acquisition in September
2010. 75,000 shares of such
stock are outstanding and pay
quarterly dividends at an
annual rate of 4%.
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 Year Ended
------------------ ----------
December 31, September 30, December 31,
------------ ------------- ------------
(In thousands, except
rig activity) 2013 2012 2013 2013 2012
---- ---- ---- ---- ----
Reportable segments:
Operating revenues and Earnings (losses) from
unconsolidated affiliates:
Drilling and Rig Services:
U.S. $471,027 $495,154 $491,857 $1,914,786 $2,276,808
Canada 88,623 115,668 81,397 361,676 429,411
International 407,615 324,728 383,712 1,464,264 1,265,060
Rig Services (1) 132,502 154,376 131,151 516,004 688,310
------- ------- ------- ------- -------
Subtotal Drilling and
Rig Services (2) 1,099,767 1,089,926 1,088,117 4,256,730 4,659,589
Completion and Production Services:
Completion Services 292,039 295,827 266,520 1,074,713 1,462,767
Production Services 266,235 248,407 246,806 1,009,214 1,000,873
------- ------- ------- --------- ---------
Subtotal Completion
and Production
Services (3) 558,274 544,234 513,326 2,083,927 2,463,640
Other reconciling
items (4) (52,651) (62,415) (52,478) (188,603) (581,498)
------- ------- ------- -------- --------
Total operating
revenues and earnings
(losses) from
unconsolidated
affiliates $1,605,390 $1,571,745 $1,548,965 $6,152,054 $6,541,731
========== ========== ========== ========== ==========
Adjusted EBITDA: (5)
Drilling and Rig Services:
U.S. $187,426 $190,877 $204,622 $755,706 $916,635
Canada 29,159 42,360 26,232 118,989 150,551
International 157,720 110,661 142,767 524,492 421,614
Rig Services (1) 5,937 16,101 10,567 28,111 96,983
----- ------ ------ ------ ------
Subtotal Drilling and
Rig Services (2) 380,242 359,999 384,188 1,427,298 1,585,783
Completion and Production Services:
Completion Services 40,851 60,363 39,910 160,964 300,920
Production Services 55,574 47,369 50,904 205,632 213,036
------ ------ ------ ------- -------
Subtotal Completion
and Production
Services (3) 96,425 107,732 90,814 366,596 513,956
Other reconciling
items (6) (39,425) (40,587) (35,665) (148,998) (152,862)
------- ------- ------- -------- --------
Total adjusted EBITDA $437,242 $427,144 $439,337 $1,644,896 $1,946,877
======== ======== ======== ========== ==========
Adjusted income (loss) derived from operating
activities: (7)
Drilling and Rig Services:
U.S. $75,378 $82,603 $92,710 $315,496 $509,894
Canada 14,536 27,064 12,244 61,193 91,360
International 69,612 23,388 54,271 177,833 91,226
Rig Services (1) (2,179) 8,740 2,357 (3,918) 67,366
------ ----- ----- ------ ------
Subtotal Drilling and
Rig Services (2) 157,347 141,795 161,582 550,604 759,846
Completion and Production Services:
Completion Services 14,072 30,296 13,024 51,722 188,518
Production Services 26,736 21,374 25,909 102,130 108,835
------ ------ ------ ------- -------
Subtotal Completion
and Production
Services (3) 40,808 51,670 38,933 153,852 297,353
Other reconciling
items (6) (38,571) (39,803) (34,622) (146,237) (150,245)
------- ------- ------- -------- --------
Total adjusted income
(loss) derived from
operating activities $159,584 $153,662 $165,893 $558,219 $906,954
======== ======== ======== ======== ========
Rig activity:
Rig years: (8)
U.S. 198.4 190.3 195.5 195.0 219.1
Canada 32.5 36.3 30.0 29.9 34.8
International (9) 124.6 119.3 124.2 124.2 119.3
Total rig years 355.5 345.9 349.7 349.1 373.2
===== ===== ===== ===== =====
Rig hours: (10)
U.S. Production
Services 205,456 202,368 223,504 865,939 853,373
Canada Production
Services 36,455 44,582 39,463 152,747 181,185
Total rig hours 241,911 246,950 262,967 1,018,686 1,034,558
======= ======= ======= ========= =========
(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
($1.4) million, $.7 million and
($2.9) million for the three months
ended December 31, 2013 and 2012 and
September 30, 2013, respectively,
and ($.4) million for the year ended
December 31, 2013.
(3) Includes earnings (losses), net from
unconsolidated affiliates, accounted
for using the equity method, of
($.2) million, $.5 million and $.3
million for the three months ended
December 31, 2013 and 2012 and
September 30, 2013, respectively,
and $.4 million and $.5 million for
the years ended December 31, 2013
and 2012, respectively.
(4) Represents the elimination of inter-
segment transactions and earnings
(losses), net from our former U.S.
unconsolidated oil and gas joint
venture, accounted for using the
equity method of ($301.8) million
for the year ended December 31,
2012. In December 2012, we sold our
equity interest in the oil and gas
joint venture.
(5) Adjusted EBITDA is computed by
subtracting the sum of direct costs,
general and administrative expenses,
earnings (losses) from our former
U.S. oil and gas joint venture 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,
depreciation and amortization and
earnings (losses) from our former
U.S. oil and gas joint venture 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 December 31, 2013 and 2012 and
September 30, 2013, and 2.5 years
for the years ended December 31,
2013 and 2012.
(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 Year Ended
------------------ ----------
December 31, September 30, December 31,
------------ ------------- ------------
(In thousands) 2013 2012 2013 2013 2012
---- ---- ---- ---- ----
Adjusted EBITDA $437,242 $427,144 $439,337 $1,644,896 $1,946,877
Less: Depreciation and amortization 277,658 273,482 273,444 1,086,677 1,039,923
Adjusted income (loss) derived from
operating activities 159,584 153,662 165,893 558,219 906,954
------- ------- ------- ------- -------
U.S. oil and gas joint venture earnings
(losses) - - - - (301,801)
Interest expense (47,075) (61,836) (56,059) (223,418) (251,904)
Investment income (loss) 1,106 30,293 1,229 96,577 63,137
Gains (losses) on sales and disposals of
long-lived assets and other income
(expense), net
(10,732) 158,413 (3,266) (37,977) 136,636
Impairments and other charges - (142,757) (242,241) (287,241) (290,260)
Income (loss) from continuing operations
before income taxes $102,883 $137,775 $(134,444) $106,160 $262,762
======== ======== ========= ======== ========
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 Year Ended
------------------ ----------
December 31, September 30, December 31,
------------ ------------- ------------
(In thousands, except per
share amounts) 2013 2012 2013 2013 2012
---- ---- ---- ---- ----
Net income (loss) attributable
to Nabors (numerator):
Income (loss) from continuing
operations, net of tax $128,516 $131,565 $(90,510) $158,341 $232,181
Less: net (income) loss
attributable to
noncontrolling interest (1,026) (1,074) (441) (7,180) (621)
Less: earnings allocated to
unvested shareholders (1,948) - 1,411 (1,277) -
------ --- ----- ------ ---
Adjusted income (loss) from
continuing operations -basic
and diluted $125,542 $130,491 $(89,540) $149,884 $231,560
Income (loss) from
discontinued operations, net
of tax 23,113 (103,414) (14,430) (11,179) (67,526)
$148,655 $27,077 $(103,970) $138,705 $164,034
-------- ------- --------- -------- --------
Earnings (losses) per share:
Basic from continuing
operations $.43 $.45 $(.30) $.51 $.80
Basic from discontinued
operations .07 (.36) (.05) (.04) (.23)
Total Basic $.50 $.09 $(.35) $.47 $.57
---- ---- ----- ---- ----
Diluted from continuing
operations $.42 $.45 $(.30) $.51 $.79
Diluted from discontinued
operations .08 (.36) (.05) (.04) (.23)
Total Diluted $.50 $.09 $(.35) $.47 $.56
---- ---- ----- ---- ----
Shares (denominator):
Weighted-average number of
shares outstanding-basic 295,218 290,394 295,076 294,182 289,965
Net effect of dilutive stock
options, warrants and
restricted stock awards based
on the if-converted method
2,528 2,027 - 2,410 2,358
Weighted-average number of
shares outstanding - diluted 297,746 292,421 295,076 296,592 292,323
------- ------- ------- ------- -------
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 10,908,160 and
15,000,882 shares during the
three months ended December
31, 2013 and 2012,
respectively; 18,786,837
shares during the three months
ended September 30, 2013; and
11,642,417 and 14,200,915
shares during the years ended
December 31, 2013 and 2012,
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.
