Significant results and achievements of the first quarter include:
-- Revenues of $173.9 million, on par with the prior year's first quarter, with revenue increases in the International Drilling and Project Management and Engineering Services segments. Including revenues from the new Construction Contract segment, these offset declines in U.S. Drilling and Rental Tools; -- A significant year-to-year increase in segment gross margin as a percent of revenues for International Drilling, reaching 35.7 percent for the quarter; -- International average rig utilization of 79 percent, ahead of last year's first quarter average utilization of 73 percent; -- On-schedule progress in the construction of the BP-owned Liberty rig and two Parker-owned arctic Alaska rigs; and -- A first quarter company safety performance of 0.77 Total Recordable Incident Rate (TRIR), better than the Company's 2009 TRIR goal of 0.92.
"In a difficult market that has impacted every sector of the worldwide energy industry, Parker delivered a successful performance for the quarter, supported by our geographical diversification and balanced business mix," said
"The industry outlook for 2009 remains subdued, and will continue to impact the near-term prospects for the Company. Nevertheless, I expect our operating performance to improve as the year progresses, as we gain the benefits of a leaner cost structure; our strong technical, operational and safety leadership and our employee commitment to customer service," Mr. Parker concluded.
2009 First Quarter Financial Review
For the three months ended
Total revenues for the 2009 first quarter were relatively unchanged compared to the same period last year. U.S. Barge Drilling revenues declined 78 percent, to
Adjusted EBITDA for the first quarter 2009 was
Operations Review
-- Average utilization for the Company's Gulf of Mexico barge rigs for the first quarter 2009 was 25 percent, compared to the 77 percent reported for the first quarter 2008 and the 61 percent reported for the fourth quarter 2008. Currently, barge rig utilization is 40 percent. The Company's barge dayrates in the Gulf of Mexico averaged $28,000 per day during the first quarter 2009, compared to $41,200 per day in the first quarter 2008 and $39,400 per day in the fourth quarter 2008. (Average dayrates for each classification of barge by quarter are available in the "Dayrates - GOM" schedule posted on Parker's Web site under "Investor Relations" at "Quarterly Support Materials".) -- Average utilization of international rigs, both land and barge rigs, for the first quarter 2009 was 79 percent, compared to 73 percent reported for the first quarter 2008 and 87 percent reported for the fourth quarter 2008. (Average utilization for each international region's rig fleet by quarter is available in the "Rig Utilization Schedule" posted on Parker's Web site under "Investor Relations" at "Quarterly Support Materials".) -- The Company's Americas region operated at 90 percent utilization, with nine of ten rigs working throughout the quarter. Most of the working rigs in this region are on multi-well contracts that extend beyond 2009. -- Parker's twelve rigs located in the Commonwealth of Independent States / Africa Middle East (CIS / AME) region achieved average utilization of 86 percent during the quarter. Eleven rigs worked during the quarter, with one rig completing its contracted work in January. The majority of the working rigs in the CIS / AME region are operating under contracts that extend beyond 2009. -- The eight-rig Parker fleet located in the Asia Pacific region operated at 64 percent utilization during the quarter. Five of the eight rigs worked during the quarter, one of which completed its contracted work in January. Most contracts in this region are for short duration projects. One working rig is on a contract that extends beyond 2009. -- In Project Management and Engineering Services, the Yastreb rig, operated by Parker Drilling for the Sakhalin-1 consortium, completed its move north and spent much of the first quarter preparing to drill the Odoptu field.
Capital expenditures for the three months ended
At the end of the period total debt was
Conference Call
This release contains certain statements that may be deemed to be "forward-looking statements" within the meaning of the Securities Acts. All statements, 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, including earnings per share guidance, the outlook for rig utilization and dayrates, general industry conditions including demand for drilling and customer spending and the factors affecting demand, competitive advantages including cost effective integrated solutions and technological innovation, future technological innovation, future operating results of the Company's rigs and rental tool operations, capital expenditures, expansion and growth opportunities, asset sales, successful negotiation and execution of contracts, strengthening of financial position, increase in market share and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this release are based on reasonable assumptions, actual results may differ materially from those expressed or implied in the forward-looking statements due to certain risk factors, including the ongoing credit crisis which has created volatility in oil and natural gas prices and could result in reduced demand for drilling services. For a detailed discussion of risk factors that could cause actual results to differ materially from the Company's expectations, please refer to the Company's reports filed with the SEC, and in particular, the report on Form 10-K for the year ended
PARKER DRILLING COMPANY AND SUBSIDIARIES Consolidated Condensed Balance Sheets March 31, 2009 December 31, 2008 -------------- ----------------- (Unaudited) ASSETS (Dollars in Thousands) CURRENT ASSETS Cash and Cash Equivalents $148,403 $172,298 Accounts and Notes Receivable, Net 182,333 186,164 Rig Materials and Supplies 30,201 30,241 Deferred Costs 7,044 7,804 Deferred Income Taxes 9,735 9,735 Other Current Assets 61,546 67,049 ------ ------ TOTAL CURRENT ASSETS 439,262 473,291 ------- ------- PROPERTY, PLANT AND EQUIPMENT, NET 707,128 675,548 OTHER ASSETS Deferred Income Taxes 25,852 22,956 Other Assets 33,060 33,925 ------ ------ TOTAL OTHER ASSETS 58,912 56,881 ------ ------ TOTAL ASSETS $1,205,302 $1,205,720 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current Portion of Long-Term Debt $9,000 $6,000 Accounts Payable and Accrued Liabilities 145,635 152,528 ------- ------- TOTAL CURRENT LIABILITIES 154,635 158,528 ------- ------- LONG-TERM DEBT 437,464 435,394 LONG-TERM DEFERRED TAX LIABILITY 7,133 8,230 OTHER LONG-TERM LIABILITIES 19,342 21,396 STOCKHOLDERS' EQUITY 586,728 582,172 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,205,302 $1,205,720 ========== ========== Current Ratio 2.84 2.99 Total Debt as a Percent of Capitalization 43% 43% Book Value Per Common Share $5.04 $5.13 PARKER DRILLING COMPANY AND SUBSIDIARIES Consolidated Condensed Statements of Operations (Unaudited) Three Months Ended March 31, ----------------- 2009 2008 ---- ---- (Dollars in Thousands) REVENUES: U.S. Drilling $9,856 $45,888 International Drilling 77,381 68,740 Project Management and Engineering Services 32,054 19,179 Construction Contract 16,745 - Rental Tools 37,889 39,471 ------ ------ TOTAL REVENUES 173,925 173,278 ------- ------- OPERATING EXPENSES: U.S. Drilling 13,136 21,522 International Drilling 49,777 52,621 Project Management and Engineering Services 25,894 15,661 Construction Contract 15,914 - Rental Tools 16,454 15,818 Depreciation and Amortization 27,124 26,166 ------ ------ TOTAL OPERATING EXPENSES 148,299 131,788 ------- ------- TOTAL OPERATING GROSS MARGIN 25,626 41,490 ------ ------ General and Administrative Expense (13,060) (6,668) Gain on Disposition of Assets, Net 78 579 -- --- TOTAL OPERATING INCOME 12,644 35,401 ------ ------ OTHER INCOME AND (EXPENSE): Interest Expense (8,066) (6,837) Interest Income 286 368 Equity in Loss of Unconsolidated Joint Venture and Related Charges, net of tax - (1,105) Other Income (12) 60 --- -- TOTAL OTHER INCOME AND (EXPENSE) (7,792) (7,514) ------ ------ INCOME BEFORE INCOME TAXES 4,852 27,887 ----- ------ INCOME TAX EXPENSE (BENEFIT) Current 6,738 (10,643) Deferred (3,992) 15,328 ------ ------ TOTAL INCOME TAX EXPENSE (BENEFIT) 2,746 4,685 ----- ----- NET INCOME $2,106 $23,202 ====== ======= EARNINGS PER SHARE - BASIC Net Income $0.02 $0.21 EARNINGS PER SHARE - DILUTED Net Income $0.02 $0.21 NUMBER OF COMMON SHARES USED IN COMPUTING EARNINGS PER SHARE Basic 112,260,517 110,546,311 Diluted 113,366,444 111,481,301 PARKER DRILLING COMPANY AND SUBSIDIARIES Selected Financial Data (Unaudited) Three Months Ended ------------------------------ March 31, December 31, ------------- ------------ 2009 2008 2008 ---- ---- ---- (Dollars in Thousands) REVENUES: U.S. Drilling $9,856 $45,888 $33,634 International Drilling 77,381 68,740 86,211 Project Management and Engineering Services 32,054 19,179 37,928 Construction Contract 16,745 - 8,911 Rental Tools 37,889 39,471 45,696 ------ ------ ------ Total Revenues 173,925 173,278 212,380 ------- ------- ------- OPERATING EXPENSES: U.S. Drilling 13,136 21,522 18,929 International Drilling 49,777 52,621 58,494 Project Management and Engineering Services 25,894 15,661 29,858 Construction Contract 15,914 - 8,442 Rental Tools 16,454 15,818 17,034 ------ ------ ------ Total Operating Expenses 121,175 105,622 132,757 ------- ------- ------- OPERATING GROSS MARGIN: U.S. Drilling (3,280) 24,366 14,705 International Drilling 27,604 16,119 27,717 Project Management and Engineering Services 6,160 3,518 8,070 Construction Contract 831 - 469 Rental Tools 21,435 23,653 28,662 Depreciation and Amortization (27,124) (26,166) (31,961) ------- ------- ------- Total Operating Gross Margin 25,626 41,490 47,662 General and Administrative Expense (13,060) (6,668) (10,288) Impairment of Goodwill - - (100,315) Gain on Disposition of Assets, Net 78 579 683 ------- ------- -------- TOTAL OPERATING INCOME (LOSS) $12,644 $35,401 $(62,258) ======= ======= ======== Marketable Rig Count Summary As of March 31, 2009 Total ----- U.S. Gulf of Mexico Barge Rigs Workover 2 Intermediate 3 Deep 10 -- Total U.S. Gulf of Mexico Barge Rigs 15 International Land and Barge Rigs Asia Pacific 8 Americas 10 CIS/AME 12 Other 1 - Total International Land and Barge Rigs 31 -- Total Marketable Rigs 46 == Adjusted EBITDA (Unaudited) (Dollars in Thousands) Three Months Ended ----------------------------------------------------------- March 31, December 31, September 30, June 30, March 31, 2009 2008 2008 2008 2008 --------- ------------ ------------- -------- --------- Previously Reported Net Income (Loss) $2,106 $(39,477) $18,551 $22,596 $23,888 Restated Interest Expense, Net of Tax - Per APB 14-1 - (724) (721) (699) (686) ------ ---- ---- ---- ---- Restated Net Income (Loss) 2,106 (40,201) 17,830 21,897 23,202 Adjustments: Income Tax (Benefit) Expense 2,746 (31,178) 19,673 13,762 4,685 Total Other Income and Expense 7,792 9,121 6,344 6,531 7,514 Loss/(Gain) on Disposition of Assets, Net (78) (683) (799) (636) (579) Impairment of Goodwill - 100,315 Depreciation and Amortization 27,124 31,961 30,663 28,166 26,166 Provision for Reduction in Carrying Value of Certain Assets - - - - - ------ ------ ------ ------ ------ Adjusted EBITDA $39,690 $69,335 $73,711 $69,720 $60,988 ======= ======= ======= ======= ======= Three Months Ended --------------------------------------------------- December 31, September 30, June 30, March 31, 2007 2007 2007 2007 ------------- ------------- --------- --------- Previously Reported Net Income (Loss) $34,571 $22,653 $16,860 $29,994 Restated Interest Expense, Net of Tax - Per APB 14-1 (670) (562) - - ---- ---- ----- ------ Restated Net Income (Loss) 33,901 22,091 16,860 29,994 Adjustments: Income Tax (Benefit) Expense (21,830) 18,803 15,813 24,109 Total Other Income and Expense 31,385 9,706 4,231 5,920 Loss/(Gain) on Disposition of Assets, Net 784 (543) (269) (16,404) Impairment of Goodwill Depreciation and Amortization 25,059 23,043 19,642 18,059 Provision for Reduction in Carrying Value of Certain Assets 371 1,091 - - --- ----- ------ ----- Adjusted EBITDA $69,670 $74,191 $56,277 $61,678 ======= ======= ======= ======= PARKER DRILLING COMPANY AND SUBSIDIARIES Reconciliation of Non-Routine Items * (Unaudited) (Dollars in Thousands, except Per Share) Three Months Ending March 31, 2009 -------------- Net income $2,106 Earnings per diluted share $0.02 Adjustments: DOJ investigation 5,308 ----- Total adjustments $5,308 Tax effect of non-routine adjustments (1,858) ------ Net non-routine adjustments $3,450 ------ Adjusted net income $5,556 ====== Adjusted earnings per diluted share $0.05 ===== Three Months Ending March 31, 2008 -------------- Previously reported net income $23,888 Previously reported earnings per diluted share $0.21 Restated interest expense, net of tax - per APB 14-1 $(686) Restated net income $23,202 Restated earnings per share $0.21 Adjustments: Saudi Arabia $1,105 FIN 48 tax benefit - Kazakhstan (10,560) PNG tax 4,127 DOJ investigation 441 --- Total adjustments $(4,887) Tax effect of non-routine adjustments (175) ---- Net non-routine adjustments $(5,062) ------- Adjusted net income $18,140 ======= Adjusted earnings per diluted share $0.16 ===== * Adjusted net income, a non-GAAP financial measure, excludes items that management believes are of a non-routine nature and which detract from an understanding of normal operating performance and comparisons with other periods. Management also believes that results excluding these items are more comparable to estimates provided by securities analysts and used by them in evaluating the Company's performance.
SOURCE Parker Drilling Company