HOUSTON, Oct. 27, 2016 /PRNewswire/ -- Parker Drilling Company (NYSE: PKD) today announced results for the third quarter ended September 30, 2016, including a reported net loss of $46.2 million, or a $0.37 loss per share, on revenues of $97.2 million.

Third quarter adjusted EBITDA was $5.1 million.

"We are pleased with our third quarter results given the challenging market conditions," said Gary Rich, the Company's Chairman, President and CEO. "While results were down quarter-on-quarter, they were in line with our expectations. We also saw improvements in some areas of our business.

"Results from our Rentals Tools business improved slightly in the third quarter. Our rental activity in the U.S. land market increased as drilling activity improved, and this partially offset further declines in our U.S. offshore rentals. Results from our International Rental Tools segment improved in the third quarter due to the startup of previously delayed contracts and further cost reductions. In addition, our Drilling Services business benefited from the initial startup of a new operations and maintenance (O&M) contract for the Atlantic Coast, Canada and the addition of a fourth rig under an existing O&M contract on Sakhalin Island, Russia, both of which were awarded in the second quarter.

"We remain focused on cash flow and ended the quarter with $194 million in liquidity including $104 million in cash and $90 million available on our undrawn revolver. Contracted backlog was $421 million at the end of the third quarter compared with $446 million as of June 30, 2016.

"Looking forward, while there are indications market conditions are stabilizing and we may continue to see conditions improve in the near future, our expectations for the pace of the recovery remain guarded. As we navigate these market conditions, we are well positioned in our target markets and will continue to focus on execution, cash flow and financial discipline," concluded Rich.

Third Quarter Review

Parker Drilling's revenues for the 2016 third quarter, compared with the 2016 second quarter, decreased 7.7 percent to $97.2 million from $105.3 million, operating gross margin excluding depreciation and amortization expense (gross margin) decreased 22.4 percent to $12.5 million from $16.1 million and gross margin as a percentage of revenues was 12.9 percent, compared with 15.3 percent.

Drilling Services

For the Company's Drilling Services business, which is comprised of the U.S. (Lower 48) Drilling and International & Alaska Drilling segments, third quarter revenues decreased 8.6 percent to $66.7 million from $73.0 million for the 2016 second quarter, gross margin decreased 28.8 percent to $9.9 million from $13.9 million, and gross margin as a percentage of revenues was 14.8 percent, compared with 19.0 percent for the prior period.

U.S. (Lower 48) Drilling

U.S. (Lower 48) Drilling segment revenues were $1.4 million compared with $1.1 million in the 2016 second quarter. Gross margin was a $3.7 million loss as compared with a 2016 second quarter loss of $3.9 million. The increase in revenues and gross margin improvement were primarily the result of slightly higher utilization.

International & Alaska Drilling

International & Alaska Drilling segment revenues were $65.3 million, a 9.2 percent decrease from 2016 second quarter revenues of $71.9 million. Gross margin was $13.6 million, a 23.6 percent decrease from 2016 second quarter gross margin of $17.8 million. Gross margin as a percentage of revenues was 20.8 percent as compared with 24.8 percent in the 2016 second quarter. The decrease in revenues and gross margin were attributable to the completion of a project services engagement early in the third quarter and lower rig utilization. There were also margin benefits in the second quarter that did not repeat in the third quarter, including a rig contract early termination fee and the release of accruals related to the wind down of operations in certain locations. Partially offsetting these declines were the start-ups of the new O&M contracts.

Rental Tools Services

Effective July 1, 2016, we report our Rental Tools Services business as two reportable segments: (1) U.S. Rental Tools and (2) International Rental Tools. Third quarter revenues for the Rental Tools Services business decreased 5.6 percent to $30.5 million from $32.3 million for the 2016 second quarter, gross margin increased 18.2 percent to $2.6 million from $2.2 million, and gross margin as a percentage of revenues was 8.5 percent compared with 6.8 percent for the prior period.

U.S. Rental Tools

U.S. Rental Tools segment revenues were $15.0 million, compared with $18.0 million for the 2016 second quarter. Gross margin was $4.2 million compared with $5.7 million for the 2016 second quarter. The declines in revenues and gross margin were primarily due to a decline in offshore Gulf of Mexico revenues partially offset by an increase in land revenues.

International Rental Tools

International Rental Tools segment revenues were $15.5 million, compared with $14.3 million for the 2016 second quarter. Gross margin was a $1.7 million loss compared with a 2016 second quarter loss of $3.5 million. The increase in revenues and improvement in gross margin were due to increased rental activity associated with both previously delayed new contract start-ups and existing contracts. Gross margin also benefited from lower operating expenses.

Consolidated

General and Administrative expenses were $7.4 million for the 2016 third quarter, down from $8.0 million for the 2016 second quarter. The decrease was primarily due to incentive plan adjustments.

Capital expenditures in the third quarter were $4.7 million, and year-to-date through September 30, 2016 were $21.0 million.

Conference Call

Parker Drilling has scheduled a conference call for 10:00 a.m. Central Time (11:00 a.m. Eastern Time) on Friday, October 28, 2016, to review third quarter results. The call will be available by telephone by dialing (+1) (412) 902-0003 and asking for the Parker Drilling Third Quarter Conference Call. The call can also be accessed through the Investor Relations section of the Company's website. A replay of the call can be accessed on the Company's website for 12 months and will be available by telephone through November 4, 2016 at (+1) (201) 612-7415, conference ID 13646195.

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 addressing activities, events or developments 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 rental tools utilization and rig utilization and dayrates; the results of past capital expenditures; scheduled start-ups of rigs; 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; future capital expenditures; expansion and growth opportunities; acquisitions or joint ventures; asset purchases and sales; successful negotiation and execution of contracts; scheduled delivery of drilling rigs or rental equipment for operation; the Company's financial position; changes in utilization or market share; outcomes of legal proceedings; 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 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, fluctuations in oil and natural gas prices, compliance with existing laws and changes in laws or government regulations, the failure to realize the benefits of, and other risks relating to, acquisitions, the risk of cost overruns, our ability to refinance our debt and other important factors, many of which could adversely affect market conditions, demand for our services, and costs, and all or any one of which could cause actual results to differ materially from those projected. For more information, see "Risk Factors" in the Company's Annual Report filed on Form 10-K with the Securities and Exchange Commission 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 provides drilling services and rental tools to the energy industry. The Company's Drilling Services business serves operators in the inland waters of the U.S. Gulf of Mexico utilizing Parker Drilling's barge rig fleet and in select international markets and harsh-environment regions utilizing Parker-owned and customer-owned equipment. The Company's Rental Tools Services business supplies premium equipment and well services to operators on land and offshore in the U.S. and international markets. More information about Parker Drilling can be found on the Company's website at www.parkerdrilling.com.


Contact: Jason Geach, Vice President, Investor Relations & Corporate Development, (+1) (281) 406-2310, jason.geach@parkerdrilling.com.




                                       PARKER DRILLING COMPANY

                                Consolidated Condensed Balance Sheets

                                       (Dollars in Thousands)


                                           September 30,
                                                2016                  December 31, 2015
                                          --------------              -----------------

                                            (Unaudited)

    ASSETS:

    Current Assets

    Cash and
     Cash
     Equivalents                                             $103,613                     $134,294

    Accounts
     and
     Notes
     Receivable,
     net                                         130,616                        175,105

    Rig
     Materials
     and
     Supplies                                     32,681                         34,937

    Other
     Current
     Assets                                       22,514                         22,405
                                                  ------                         ------

    Total
     Current
     Assets                                      289,424                        366,741
                                                 -------                        -------


    Property,
     Plant and
     Equipment,
     net                                         718,254                        805,841


    Other Assets

    Deferred
     Income
     Taxes                                        87,653                        139,282

    Other
     Assets                                       54,551                         54,838

    Total
     Other
     Assets                                      142,204                        194,120
                                                 -------                        -------


    Total
     Assets                                                $1,149,882                   $1,366,702
                                                           ==========                   ==========


    LIABILITIES & STOCKHOLDERS'
     EQUITY:

    Current Liabilities

    Accounts
     Payable
     and
     Accrued
     Liabilities                                              $93,293                     $136,121

    Total
     Current
     Liabilities                                  93,293                        136,121
                                                  ------                        -------


    Long-
     Term
     Debt,
     net of
     debt
     issuance
     costs                                       575,935                        574,798


    Deferred
     Tax
     Liability                                    78,893                         68,654


    Other
     Long-
     Term
     Liabilities                                  16,161                         18,617


    Total
     Stockholders'
     Equity                                      385,600                        568,512
                                                 -------                        -------


    Total
     Liabilities
     and
     Stockholders'
     Equity                                                $1,149,882                   $1,366,702
                                                           ==========                   ==========



                                                                     PARKER DRILLING COMPANY

                                                               Consolidated Statement Of Operations

                                                          (Dollars in Thousands, Except Per Share Data)

                                                                           (Unaudited)

                                                                                                  Three Months Ended
                                                                                                       June 30,
                                                                                                     --------

                                                    Three Months Ended September 30,
                                                    --------------------------------

                                                     2016                     2015                                2016
                                                     ----                     ----                                ----


    Revenues                                                  $97,189                                                    $173,418                $105,287


    Expenses:

    Operating Expenses                             84,680                                128,963                                       89,195

    Depreciation and
     Amortization                                  34,474                                 39,584                                       36,317

                                                  119,154                                168,547                                      125,512
                                                  -------                                -------                                      -------

    Total Operating Gross
     Margin                                      (21,965)                                 4,871                                     (20,225)
                                                  -------                                  -----                                      -------


    General and
     Administrative Expense                       (7,424)                               (8,895)                                     (7,995)

    Provision for Reduction
     in Carrying Value of
     Certain Assets                                     -                                 (906)                                           -

    Gain (Loss) on
     Disposition of Assets,
     net                                            (187)                                   383                                          (2)
                                                     ----                                    ---

    Total Operating Income
     (Loss)                                      (29,576)                               (4,547)                                    (28,222)
                                                  -------                                 ------                                      -------


    Other Income (Expense)

    Interest Expense                             (11,015)                              (11,293)                                    (12,187)

    Interest Income                                     9                                      7                                           32

    Other                                           (351)                                 (719)                                       (358)

    Total Other Income
     (Expense)                                   (11,357)                              (12,005)                                    (12,513)
                                                  -------                                -------                                      -------


    Income (Loss) before
     Income Taxes                                (40,933)                              (16,552)                                    (40,735)


    Income Tax Expense
     (Benefit)                                      5,295                                 31,930                                        (913)
                                                    -----                                 ------                                         ----


    Net Income (Loss)                            (46,228)                              (48,482)                                    (39,822)
                                                  -------                                -------                                      -------

    Less: Net Income (Loss)
     Attributable to
     Noncontrolling Interest                            -                                   138                                            -

    Net Income (Loss)
     Attributable to
     Controlling Interest                                   $(46,228)                                                  $(48,620)              $(39,822)
                                                             ========                                                    ========                ========


    Income (Loss) per Share - Basic

    Net Income (Loss)                                         $(0.37)                                                    $(0.40)                $(0.32)


    Income (Loss) per Share - Diluted

    Net Income (Loss)                                         $(0.37)                                                    $(0.40)                $(0.32)


    Number of common shares used in computing
     earnings per share:

    Basic                                     124,486,848                            122,933,518                                  124,101,349

    Diluted                                   124,486,848                            122,933,518                                  124,101,349




                                                PARKER DRILLING COMPANY

                                          Consolidated Statement Of Operations

                                     (Dollars in Thousands, Except Per Share Data)

                                                      (Unaudited)


                                                        Nine Months Ended September 30,
                                                       -------------------------------

                                                       2016                      2015
                                                       ----                      ----


    Revenues                                                    $332,979                              $563,435


    Expenses:

    Operating Expenses                              281,992                                 411,802

    Depreciation and
     Amortization                                   106,605                                 118,474

                                                    388,597                                 530,276
                                                    -------                                 -------

    Total Operating Gross
     Margin                                        (55,618)                                 33,159
                                                    -------                                  ------


    General and
     Administrative Expense                        (25,200)                               (29,243)

    Provision for Reduction
     in Carrying Value of
     Certain Assets                                       -                                (3,222)

    Gain (Loss) on
     Disposition of Assets,
     net                                              (249)                                  2,686
                                                       ----                                   -----

    Total Operating Income
     (Loss)                                        (81,067)                                  3,380
                                                    -------                                   -----


    Other Income (Expense)

    Interest Expense                               (34,764)                               (33,767)

    Interest Income                                      48                                     209

    Other                                             1,776                                 (3,628)

    Total Other Income
     (Expense)                                     (32,940)                               (37,186)
                                                    -------                                 -------


    Income (Loss) before
     Income Taxes                                 (114,007)                               (33,806)


    Income Tax Expense
     (Benefit)                                       67,878                                  24,832
                                                     ------                                  ------


    Net Income (Loss)                             (181,885)                               (58,638)
                                                   --------                                 -------

    Less: Net Income (Loss)
     Attributable to
     Noncontrolling Interest                              -                                    789

    Net Income (Loss)
     Attributable to
     Controlling Interest                                     $(181,885)                            $(59,427)
                                                               =========                              ========


    Income (Loss) per Share - Basic

    Net Income (Loss)                                            $(1.47)                              $(0.49)


    Income (Loss) per Share - Diluted

    Net Income (Loss)                                            $(1.47)                              $(0.49)


    Number of common shares used in computing
     earnings per share:

    Basic                                       123,894,980                             122,430,957

    Diluted                                     123,894,980                             122,430,957




                                                              PARKER DRILLING COMPANY

                                                              Selected Financial Data

                                                              (Dollars in Thousands)

                                                                    (Unaudited)



                                                                  Three Months Ended
                                                                  ------------------

                                                          September 30,                       June 30,
                                                          -------------

                                                  2016                     2015                2016
                                                  ----                     ----                ----


    Revenues:

    Drilling Services:
    ------------------

    U.S. (Lower 48) Drilling                               $1,431                                      $5,961                     $1,065

    International & Alaska
     Drilling                                  65,307                              110,661                          71,926
                                                                                  -------                          ------

                 Total Drilling Services          66,738                              116,622                          72,991

    Rental Tools Services:
    ----------------------

    U.S. Rental Tools                                     $14,967                                     $31,905                    $17,961

    International Rental Tools                 15,484                               24,891                          14,335

                 Total Rental Tools Services      30,451                               56,796                          32,296


                   Total Revenues                            $97,189                                    $173,418                   $105,287



    Operating Expenses:

    Drilling Services:
    ------------------

    U.S. (Lower 48) Drilling                               $5,112                                      $7,820                     $4,967

    International & Alaska
     Drilling                                  51,682                               81,586                          54,110
                                                                                                                  ------

                 Total Drilling Services          56,794                               89,406                          59,077

    Rental Tools Services:
    ----------------------

    U.S. Rental Tools                                     $10,746                                     $17,002                    $12,267

    International Rental Tools                 17,140                               22,555                          17,851
                                               ------                               ------                          ------

                 Total Rental Tools Services      27,886                               39,557                          30,118


                   Total Operating Expenses                  $84,680                                    $128,963                    $89,195



    Operating Gross Margin:

    Drilling Services:
    ------------------

    U.S. (Lower 48) Drilling                             $(3,681)                                   $(1,859)                  $(3,902)

    International & Alaska
     Drilling                                  13,625                               29,075                          17,816
                                                                                   ------                          ------

                 Total Drilling Services           9,944                               27,216                          13,914

    Rental Tools Services:
    ----------------------

    U.S. Rental Tools                                      $4,221                                     $14,903                     $5,694

    International Rental Tools                (1,656)                               2,336                         (3,516)
                                               ------                                -----                          ------

                 Total Rental Tools Services       2,565                               17,239                           2,178

    Depreciation and Amortization            (34,474)                            (39,584)                       (36,317)
                                              -------                              -------                         -------

                   Total Operating Gross
                    Margin                                 $(21,965)                                     $4,871                  $(20,225)




                                                                                        PARKER DRILLING COMPANY

                                                                                          Adjusted EBITDA (1)

                                                                                         (Dollars in Thousands)

                                                                                              (Unaudited)


                                                                      Three Months Ended
                                                                     ------------------

                               September 30,           June 30,           March 31,                December 31,    September 30,
                                        2016                 2016                 2016                        2015              2015
                                        ----                 ----                 ----                        ----              ----


    Net Income (Loss)
     Attributable to
     Controlling Interest                    $(46,228)                                 $(39,822)                                   $(95,835)           $(35,646)    $(48,620)

    Interest Expense                  11,015                      12,187                                   11,562                        11,388   11,293

    Income Tax Expense
     (Benefit)                         5,295                       (913)                                  63,496                       (2,519)  31,930

    Depreciation and
     Amortization                     34,474                      36,317                                   35,814                        37,720   39,584


    EBITDA                             4,556                       7,769                                   15,037                        10,943   34,187
                                       =====                       =====                                   ======                        ======   ======


    Adjustments:

    Other (Income) Expense               342                         326                                  (2,492)                        6,059      712

    (Gain) Loss on Disposition
     of Assets, net                      187                           2                                       60                         1,043    (383)

    Provision for Reduction in
     Carrying Value of Certain
     Assets                                -                          -                                       -                        9,268      906

    Special items (2)                      -                          -                                       -                        1,265        -
                                         ---                        ---                                     ---                        -----      ---


    Adjusted EBITDA                             $5,085                                     $8,097                                      $12,605              $28,578       $35,422
                                                ======                                     ======                                      =======              =======       =======



    (1) We believe Adjusted EBITDA is an
     important measure of operating
     performance because it allows
     management, investors and others to
     evaluate and compare our core
     operating results from period to
     period by removing the impact of our
     capital structure (interest expense
     from our outstanding debt), asset
     base (depreciation and
     amortization), remeasurement of
     foreign currency transactions, tax
     consequences, impairment and other
     special items. Special items include
     items impacting operating expenses
     that management believes detract
     from an understanding of normal
     operating performance. Management
     uses Adjusted EBITDA as a
     supplemental measure to review
     current period operating performance
     and period to period comparisons.
     Our Adjusted EBITDA may not be
     comparable to a similarly titled
     measure of another company because
     other entities may not calculate
     EBITDA in the same manner. EBITDA
     and Adjusted EBITDA are not measures
     of financial performance under U.S.
     Generally Accepted Accounting
     Principles (GAAP), and should not be
     considered in isolation or as an
     alternative to operating income or
     loss, net income or loss, cash flows
     provided by or used in operating,
     investing and financing activities,
     or other income or cash flow
     statement data prepared in
     accordance with GAAP.


    (2) For the three months ended
     December 31, 2015, special items
     include a $1.3 million write-off of
     inventory associated with our
     decision to no longer provide
     drilling services in Colombia.




                                                         PARKER DRILLING COMPANY

                                              Reconciliation of Adjusted Earnings Per Share

                                              (Dollars in Thousands, Except Per Share Data)

                                                               (Unaudited)

                                                                                Three Months Ended
                                                                                ------------------

                                                                     September 30,                       June 30,
                                                                     -------------

                                                            2016                     2015                 2016
                                                            ----                     ----                 ----


    Net Income (Loss) Attributable to
     Controlling Interest                              $(46,228)                                   $(48,620)           $(39,822)

    Income (Loss) per Diluted Share                      $(0.37)                                     $(0.40)             $(0.32)


     Adjustments:

    Valuation Allowance                            -                              36,632                             -
                                                 ---                              ------                           ---

    Total adjustments                              -                              36,632                             -

     Tax effect of adjustments                     -                                   -                            -
                                                 ---                                 ---                          ---

    Net adjustments                                -                              36,632                             -
                                                 ---                              ------                           ---


     Adjusted Net Income (Loss) Attributable
      to Controlling Interest (1)                      $(46,228)                                   $(11,988)           $(39,822)
                                                        ========                                     ========             ========

     Adjusted Income (Loss) per Diluted Share
      (1)                                               $(0.37)                                     $(0.10)             $(0.32)
                                                          ======                                       ======               ======


    (1) We believe Adjusted Net
     Income (Loss) Attributable to
     Controlling Interest and
     Adjusted Income (Loss) per
     Diluted Share are useful
     financial measures for investors
     to assess and understand
     operating performance for period
     to period comparisons.
     Management views the adjustments
     to Net Income (Loss)
     Attributable to Controlling
     Interest and Income (Loss) per
     Diluted Share to be items
     outside of the Company's normal
     operating results. Adjusted Net
     Income (Loss) Attributable to
     Controlling Interest and
     Adjusted Income (Loss) per
     Diluted Share are not measures
     of financial performance under
     GAAP, and should not be
     considered in isolation or as an
     alternative to Net Income (Loss)
     or Income (Loss) per Diluted
     Share.

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SOURCE Parker Drilling Company