Large Accelerated Filer
þ
|
Accelerated Filer o | Non-accelerated Filer o | Smaller Reporting Company o |
2
March 31, |
December 31, |
|||||||
(In thousands, except per share amounts) | 2011 | 2010 | ||||||
(Unaudited) | ||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 569,736 | $ | 641,702 | ||||
Short-term investments
|
160,571 | 159,488 | ||||||
Assets held for sale
|
357,516 | 352,048 | ||||||
Accounts receivable, net
|
1,242,954 | 1,116,510 | ||||||
Inventory
|
195,230 | 158,836 | ||||||
Deferred income taxes
|
21,214 | 31,510 | ||||||
Other current assets
|
163,909 | 152,836 | ||||||
Total current assets
|
2,711,130 | 2,612,930 | ||||||
Long-term investments and other receivables
|
43,744 | 40,300 | ||||||
Property, plant and equipment, net
|
7,975,957 | 7,815,419 | ||||||
Goodwill
|
494,005 | 494,372 | ||||||
Investment in unconsolidated affiliates
|
300,425 | 267,723 | ||||||
Other long-term assets
|
365,147 | 415,825 | ||||||
Total assets
|
$ | 11,890,408 | $ | 11,646,569 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities:
|
||||||||
Current portion of long-term debt
|
$ | 1,391,224 | $ | 1,379,018 | ||||
Trade accounts payable
|
433,695 | 355,282 | ||||||
Accrued liabilities
|
376,715 | 394,292 | ||||||
Income taxes payable
|
28,958 | 25,788 | ||||||
Total current liabilities
|
2,230,592 | 2,154,380 | ||||||
Long-term debt
|
3,064,035 | 3,064,126 | ||||||
Other long-term liabilities
|
262,556 | 245,765 | ||||||
Deferred income taxes
|
789,743 | 770,247 | ||||||
Total liabilities
|
6,346,926 | 6,234,518 | ||||||
Commitments and contingencies (Note 9)
|
||||||||
Subsidiary preferred stock
|
69,188 | 69,188 | ||||||
Equity:
|
||||||||
Shareholders equity:
|
||||||||
Common shares, par value $.001 per share:
|
||||||||
Authorized common shares 800,000; issued 316,435 and 315,034,
respectively
|
316 | 315 | ||||||
Capital in excess of par value
|
2,266,800 | 2,255,787 | ||||||
Accumulated other comprehensive income
|
379,956 | 342,052 | ||||||
Retained earnings
|
3,790,706 | 3,707,881 | ||||||
Less: treasury shares, at cost, 29,414 common shares
|
(977,873 | ) | (977,873 | ) | ||||
Total shareholders equity
|
5,459,905 | 5,328,162 | ||||||
Noncontrolling interest
|
14,389 | 14,701 | ||||||
Total equity
|
5,474,294 | 5,342,863 | ||||||
Total liabilities and equity
|
$ | 11,890,408 | $ | 11,646,569 | ||||
3
Three Months Ended March 31, | ||||||||
(In thousands, except per share amounts) | 2011 | 2010 | ||||||
Revenues and other income:
|
||||||||
Operating revenues
|
$ | 1,381,279 | $ | 891,346 | ||||
Earnings (losses) from unconsolidated affiliates
|
16,274 | 7,642 | ||||||
Investment income (loss)
|
12,287 | (2,557 | ) | |||||
Total revenues and other income
|
1,409,840 | 896,431 | ||||||
Costs and other deductions:
|
||||||||
Direct costs
|
858,371 | 505,197 | ||||||
General and administrative expenses
|
118,458 | 75,426 | ||||||
Depreciation and amortization
|
226,102 | 171,536 | ||||||
Depletion
|
3,573 | 5,027 | ||||||
Interest expense
|
73,924 | 66,769 | ||||||
Losses (gains) on sales and retirements of long-lived assets and
other expense (income), net
|
6,029 | 20,367 | ||||||
Total costs and other deductions
|
1,286,457 | 844,322 | ||||||
Income (loss) from continuing operations before income taxes
|
123,383 | 52,109 | ||||||
Income tax expense (benefit):
|
||||||||
Current
|
16,653 | 12,645 | ||||||
Deferred
|
21,654 | (4,055 | ) | |||||
Total income tax expense (benefit)
|
38,307 | 8,590 | ||||||
Subsidiary preferred stock dividend
|
750 | | ||||||
Income (loss) from continuing operations, net of tax
|
84,326 | 43,519 | ||||||
Income (loss) from discontinued operations, net of tax
|
(2,170 | ) | (4,421 | ) | ||||
Net income (loss)
|
82,156 | 39,098 | ||||||
Less: Net (income) loss attributable to noncontrolling interest
|
669 | 1,102 | ||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | $ | 40,200 | ||||
Earnings (losses) per share:
|
||||||||
Basic from continuing operations
|
$ | .30 | $ | .16 | ||||
Basic from discontinued operations
|
(.01 | ) | (.02 | ) | ||||
Total Basic
|
$ | .29 | $ | .14 | ||||
Diluted from continuing operations
|
$ | .29 | $ | .16 | ||||
Diluted from discontinued operations
|
(.01 | ) | (.02 | ) | ||||
Total Diluted
|
$ | .28 | $ | .14 | ||||
Weighted-average number of common shares outstanding:
|
||||||||
Basic
|
286,114 | 284,672 | ||||||
Diluted
|
292,689 | 290,736 |
4
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Cash flows from operating activities:
|
||||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | $ | 40,200 | ||||
Adjustments to net income (loss):
|
||||||||
Depreciation and amortization
|
226,071 | 172,274 | ||||||
Depletion and other exploratory expenses
|
16,265 | 6,755 | ||||||
Deferred income tax expense (benefit)
|
20,925 | (2,701 | ) | |||||
Deferred financing costs amortization
|
1,586 | 1,337 | ||||||
Pension liability amortization and adjustments
|
150 | 100 | ||||||
Discount amortization on long-term debt
|
17,515 | 19,500 | ||||||
Amortization of loss on hedges
|
231 | 145 | ||||||
Losses (gains) on long-lived assets, net
|
1,084 | 3,108 | ||||||
Losses (gains) on investments, net
|
(11,082 | ) | 3,110 | |||||
Losses (gains) on debt retirement, net
|
58 | 2,804 | ||||||
Losses (gains) on derivative instruments
|
83 | 770 | ||||||
Share-based compensation
|
3,945 | 3,461 | ||||||
Foreign currency transaction losses (gains), net
|
(409 | ) | 9,276 | |||||
Equity in (earnings) losses of unconsolidated affiliates, net of
dividends
|
(13,776 | ) | (3,661 | ) | ||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(121,572 | ) | (8,568 | ) | ||||
Inventory
|
(35,220 | ) | 1,929 | |||||
Other current assets
|
4,554 | 14,899 | ||||||
Other long-term assets
|
47,665 | (1,080 | ) | |||||
Trade accounts payable and accrued liabilities
|
44,075 | (43,266 | ) | |||||
Income taxes payable
|
1,096 | (1,383 | ) | |||||
Other long-term liabilities
|
4,855 | 4,138 | ||||||
Net cash provided by operating activities
|
290,924 | 223,147 | ||||||
Cash flows from investing activities:
|
||||||||
Purchases of investments
|
(5,870 | ) | (4,384 | ) | ||||
Sales and maturities of investments
|
3,529 | 12,509 | ||||||
Investment in unconsolidated affiliates
|
(19,000 | ) | (995 | ) | ||||
Capital expenditures
|
(358,574 | ) | (150,740 | ) | ||||
Proceeds from sales of assets and insurance claims
|
5,491 | 8,682 | ||||||
Net cash used for investing activities
|
(374,424 | ) | (134,928 | ) | ||||
Cash flows from financing activities:
|
||||||||
Increase (decrease) in cash overdrafts
|
7,565 | (3,337 | ) | |||||
Proceeds from issuance of common shares
|
9,424 | 2,818 | ||||||
Reduction in long-term debt
|
(5,560 | ) | (106,831 | ) | ||||
Repurchase of equity component of convertible debt
|
(14 | ) | (2,611 | ) | ||||
Settlement of call options and warrants, net
|
| 400 | ||||||
Purchase of restricted stock
|
(2,340 | ) | (1,866 | ) | ||||
Tax benefit related to share-based awards
|
(1 | ) | (67 | ) | ||||
Net cash provided by (used for) financing activities
|
9,074 | (111,494 | ) | |||||
Effect of exchange rate changes on cash and cash equivalents
|
2,460 | (1,931 | ) | |||||
Net (decrease) increase in cash and cash equivalents
|
(71,966 | ) | (25,206 | ) | ||||
Cash and cash equivalents, beginning of period
|
641,702 | 927,815 | ||||||
Cash and cash equivalents, end of period
|
$ | 569,736 | $ | 902,609 | ||||
5
Accumulated |
||||||||||||||||||||||||||||||||||||
Capital in |
Other |
Non- |
||||||||||||||||||||||||||||||||||
Common Shares |
Excess of |
Comprehensive |
Retained |
Treasury |
controlling |
Total |
||||||||||||||||||||||||||||||
(In thousands) | Shares | Par Value | Par Value | Income | Earnings | Shares | Interest | Equity | ||||||||||||||||||||||||||||
Balances, December 31, 2010
|
315,034 | $ | 315 | $ | 2,255,787 | $ | 342,052 | $ | 3,707,881 | $ | (977,873 | ) | $ | 14,701 | $ | 5,342,863 | ||||||||||||||||||||
Comprehensive income (loss):
|
||||||||||||||||||||||||||||||||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | 82,825 | 82,825 | ||||||||||||||||||||||||||||||||
Translation adjustment attributable to Nabors
|
31,439 | 31,439 | 31,439 | |||||||||||||||||||||||||||||||||
Unrealized gains/(losses) on marketable securities, net of
income benefit of $64
|
6,245 | 6,245 | 6,245 | |||||||||||||||||||||||||||||||||
Less: Reclassification adjustment for (gains)/losses included in
net income (loss), net of income tax benefit of $0
|
(3 | ) | (3 | ) | (3 | ) | ||||||||||||||||||||||||||||||
Pension liability amortization, net of income taxes of $59
|
92 | 92 | 92 | |||||||||||||||||||||||||||||||||
Unrealized gains/(losses) and amortization of (gains)/losses on
cash flow hedges, net of income tax benefit of $60
|
131 | 131 | 131 | |||||||||||||||||||||||||||||||||
Comprehensive income (loss) attributable to Nabors
|
$ | 120,729 | ||||||||||||||||||||||||||||||||||
Net income (loss) attributable to noncontrolling interest
|
(669 | ) | (669 | ) | (669 | ) | ||||||||||||||||||||||||||||||
Translation adjustment attributable to noncontrolling interest
|
357 | 357 | 357 | |||||||||||||||||||||||||||||||||
Comprehensive income (loss) attributable to noncontrolling
interest
|
(312 | ) | ||||||||||||||||||||||||||||||||||
Total comprehensive income (loss)
|
$ | 120,417 | ||||||||||||||||||||||||||||||||||
Issuance of common shares for stock options exercised, net of
surrender of unexercised stock options
|
750 | 1 | 9,423 | 9,424 | ||||||||||||||||||||||||||||||||
Distributions from noncontrolling interest
|
||||||||||||||||||||||||||||||||||||
Repurchase of equity component of convertible debt
|
(14 | ) | (14 | ) | ||||||||||||||||||||||||||||||||
Tax benefit related to share-based awards
|
(1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||
Restricted stock awards, net
|
651 | (2,340 | ) | (2,340 | ) | |||||||||||||||||||||||||||||||
Share-based compensation
|
3,945 | 3,945 | ||||||||||||||||||||||||||||||||||
Balances, March 31, 2011
|
316,435 | $ | 316 | $ | 2,266,800 | $ | 379,956 | $ | 3,790,706 | $ | (977,873 | ) | $ | 14,389 | $ | 5,474,294 | ||||||||||||||||||||
6
Accumulated |
||||||||||||||||||||||||||||||||||||
Capital in |
Other |
Non- |
||||||||||||||||||||||||||||||||||
Common Shares |
Excess of |
Comprehensive |
Retained |
Treasury |
controlling |
Total |
||||||||||||||||||||||||||||||
(In thousands) | Shares | Par Value | Par Value | Income | Earnings | Shares | Interest | Equity | ||||||||||||||||||||||||||||
Balances, December 31, 2009
|
313,915 | $ | 314 | $ | 2,239,323 | $ | 292,706 | $ | 3,613,186 | $ | (977,873 | ) | $ | 14,323 | $ | 5,181,979 | ||||||||||||||||||||
Comprehensive income (loss):
|
||||||||||||||||||||||||||||||||||||
Net income (loss) attributable to Nabors
|
$ | 40,200 | 40,200 | 40,200 | ||||||||||||||||||||||||||||||||
Translation adjustment attributable to Nabors
|
35,576 | 35,576 | 35,576 | |||||||||||||||||||||||||||||||||
Unrealized gains/(losses) on marketable securities, net of
income taxes of $7,587
|
45 | 45 | 45 | |||||||||||||||||||||||||||||||||
Less: Reclassification adjustment for (gains)/losses included in
net income (loss), net of income taxes of $5
|
(688 | ) | (688 | ) | (688 | ) | ||||||||||||||||||||||||||||||
Pension liability amortization, net of income taxes of $37
|
63 | 63 | 63 | |||||||||||||||||||||||||||||||||
Unrealized gains/(losses) and amortization of (gains)/losses on
cash flow hedges, net of income tax benefit of $4
|
44 | 44 | 44 | |||||||||||||||||||||||||||||||||
Comprehensive income (loss) attributable to Nabors
|
$ | 75,240 | ||||||||||||||||||||||||||||||||||
Net income (loss) attributable to noncontrolling interest
|
(1,102 | ) | (1,102 | ) | (1,102 | ) | ||||||||||||||||||||||||||||||
Translation adjustment attributable to noncontrolling interest
|
431 | 431 | 431 | |||||||||||||||||||||||||||||||||
Comprehensive income (loss) attributable to noncontrolling
interest
|
(671 | ) | ||||||||||||||||||||||||||||||||||
Total comprehensive income (loss)
|
$ | 74,569 | ||||||||||||||||||||||||||||||||||
Issuance of common shares for stock options exercised, net of
surrender of unexercised stock options
|
201 | 2,818 | 2,818 | |||||||||||||||||||||||||||||||||
Repurchase of equity component of convertible debt
|
(2,611 | ) | (2,611 | ) | ||||||||||||||||||||||||||||||||
Settlement of call options and warrants, net
|
400 | 400 | ||||||||||||||||||||||||||||||||||
Tax benefit related to share-based awards
|
(67 | ) | (67 | ) | ||||||||||||||||||||||||||||||||
Restricted stock awards, net
|
313 | (1,866 | ) | (1,866 | ) | |||||||||||||||||||||||||||||||
Share-based compensation
|
3,461 | 3,461 | ||||||||||||||||||||||||||||||||||
Balances, March 31, 2010
|
314,429 | $ | 314 | $ | 2,241,458 | $ | 327,746 | $ | 3,653,386 | $ | (977,873 | ) | $ | 13,652 | $ | 5,258,683 | ||||||||||||||||||||
7
Note 1 | Nature of Operations |
| We actively market approximately 551 land drilling rigs for oil and gas land drilling operations in the U.S. Lower 48 states, Alaska, Canada, South America, Mexico, the Caribbean, the Middle East, the Far East, Russia and Africa. | |
| We actively market approximately 578 rigs for land well-servicing and workover work in the United States and approximately 172 rigs for land workover and well-servicing work in Canada. |
| We offer a wide range of ancillary well-site services, including hydraulic fracturing, engineering, transportation and disposal, construction, maintenance, well logging, directional drilling, rig instrumentation, data collection and other support services in select United States and international markets. | |
| We manufacture and lease or sell top drives for a broad range of drilling applications, directional drilling systems, rig instrumentation and data collection equipment, pipeline handling equipment and rig reporting software. | |
| We invest in oil and gas exploration, development and production activities in the United States, Canada and Colombia through both our wholly owned subsidiaries and our oil and gas joint ventures in which we hold 49-50% ownership interests. | |
| We have a 51% ownership interest in a joint venture in Saudi Arabia, which owns and actively markets eight rigs in addition to the rigs we lease to the joint venture. | |
| We also provide logistics services for onshore drilling in Canada using helicopters and fixed-wing aircraft. |
8
Note 2 | Summary of Significant Accounting Policies |
9
Note 3 | Cash and Cash Equivalents and Investments |
March 31, |
December 31, |
|||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Cash and cash equivalents
|
$ | 569,736 | $ | 641,702 | ||||
Short-term investments:
|
||||||||
Trading equity securities
|
16,379 | 19,630 | ||||||
Available-for-sale
equity securities
|
83,702 | 79,698 | ||||||
Available-for-sale
debt securities
|
60,490 | 60,160 | ||||||
Total short-term investments
|
160,571 | 159,488 | ||||||
Long-term investments and other receivables
|
43,744 | 40,300 | ||||||
Total
|
$ | 774,051 | $ | 841,490 | ||||
March 31, 2011 | December 31, 2010 | |||||||||||||||||||||||||||
Gross |
Gross |
Gross |
Gross |
|||||||||||||||||||||||||
Unrealized |
Unrealized |
Unrealized |
Unrealized |
|||||||||||||||||||||||||
Fair |
Holding |
Holding |
Fair |
Holding |
Holding |
|||||||||||||||||||||||
Value | Gains | Losses | Value | Gains | Losses | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
Cash and cash equivalents
|
$ | 569,736 | $ | | $ | | $ | 641,702 | $ | | $ | | ||||||||||||||||
Short-term investments:
|
||||||||||||||||||||||||||||
Trading equity securities
|
16,379 | 10,655 | | 19,630 | 13,906 | | ||||||||||||||||||||||
Available-for-sale
equity securities
|
83,702 | 39,941 | (35 | ) | 79,698 | 38,176 | (2,274 | ) | ||||||||||||||||||||
Available-for-sale
debt securities:
|
||||||||||||||||||||||||||||
Commercial paper and CDs
|
1,173 | | | 1,275 | | | ||||||||||||||||||||||
Corporate debt securities
|
52,856 | 17,556 | | 52,022 | 15,274 | (18 | ) | |||||||||||||||||||||
Mortgage-backed debt securities
|
371 | 17 | | 372 | 16 | | ||||||||||||||||||||||
Mortgage-CMO debt securities
|
2,792 | 18 | (119 | ) | 3,015 | 21 | (6 | ) | ||||||||||||||||||||
Asset-backed debt securities
|
3,298 | | (151 | ) | 3,476 | | (268 | ) | ||||||||||||||||||||
Total
available-for-sale
debt securities
|
60,490 | 17,591 | (270 | ) | 60,160 | 15,311 | (292 | ) | ||||||||||||||||||||
Total
available-for-sale
securities
|
144,192 | 57,532 | (305 | ) | 139,858 | 53,487 | (2,566 | ) | ||||||||||||||||||||
Total short-term investments
|
160,571 | 68,187 | (305 | ) | 159,488 | 67,393 | (2,566 | ) | ||||||||||||||||||||
Total cash, cash equivalents and short-term investments
|
$ | 730,307 | $ | 68,187 | $ | (305 | ) | $ | 801,190 | $ | 67,393 | $ | (2,566 | ) | ||||||||||||||
10
As of March 31, 2011 | ||||||||||||||||
Less Than 12 Months | More Than 12 Months | |||||||||||||||
Gross |
Gross |
|||||||||||||||
Unrealized |
Unrealized |
|||||||||||||||
Fair Value | Loss | Fair Value | Loss | |||||||||||||
(In thousands) | ||||||||||||||||
Available-for-sale
equity securities
|
$ | | $ | | $ | 1,049 | $ | 35 | ||||||||
Available-for-sale
debt securities:(1)
|
||||||||||||||||
Corporate debt securities
|
| | | | ||||||||||||
Mortgage-CMO debt securities
|
2,255 | 114 | 135 | 5 | ||||||||||||
Asset-backed debt securities
|
| | 3,298 | 151 | ||||||||||||
Total
available-for-sale
debt securities
|
2,255 | 114 | 3,433 | 156 | ||||||||||||
Total
|
$ | 2,255 | $ | 114 | $ | 4,482 | $ | 191 | ||||||||
(1) | Our unrealized losses on available-for-sale debt securities held for more than one year are comprised of various types of securities. Each of these securities have a rating ranging from A to AAA from Standard & Poors and ranging from A2 to Aaa from Moodys Investors Service and is considered of high credit quality. In each case, we do not intend to sell these investments, and it is less likely than not that we will be required to sell them to satisfy our own cash flow and working capital requirements. We believe that we will be able to collect all amounts due according to the contractual terms of each investment and, therefore, do not consider the decline in value of these investments to be other-than-temporary at March 31, 2011. |
Estimated |
||||
Fair Value | ||||
March 31, 2011 | ||||
(In thousands) | ||||
Debt securities:
|
||||
Due in one year or less
|
$ | 1,173 | ||
Due after one year through five years
|
| |||
Due in more than five years
|
59,317 | |||
Total debt securities
|
$ | 60,490 | ||
Three Months Ended |
||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Available-for-sale:
|
||||||||
Proceeds from sales and maturities
|
$ | 503 | $ | 5,496 | ||||
Realized gains (losses), net
|
(3,248 | ) | 692 |
11
Note 4 | Fair Value Measurements |
Fair Value as of March 31, 2011 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In thousands) | ||||||||||||||||
Assets:
|
||||||||||||||||
Short-term investments:
|
||||||||||||||||
Available-for-sale
equity securities energy industry
|
$ | 83,702 | $ | | $ | | $ | 83,702 | ||||||||
Available-for-sale
debt securities
|
||||||||||||||||
Commercial paper and CDs
|
1,173 | | | 1,173 | ||||||||||||
Corporate debt securities
|
| 52,856 | | 52,856 | ||||||||||||
Mortgage-backed debt securities
|
| 371 | | 371 | ||||||||||||
Mortgage-CMO debt securities
|
| 2,792 | | 2,792 | ||||||||||||
Asset-backed debt securities
|
3,298 | | | 3,298 | ||||||||||||
Trading securities energy industry
|
16,379 | | | 16,379 | ||||||||||||
Total short-term investments
|
$ | 104,552 | $ | 56,019 | $ | | $ | 160,571 | ||||||||
Liabilities:
|
||||||||||||||||
Derivative contract
|
$ | | $ | 2,929 | $ | | $ | 2,929 | ||||||||
12
March 31, 2011 | December 31, 2010 | |||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
(In thousands) | ||||||||||||||||
0.94% senior exchangeable notes due May 2011
|
$ | 1,390,325 | $ | 1,387,967 | $ | 1,378,178 | $ | 1,403,315 | ||||||||
6.15% senior notes due February 2018
|
966,579 | 1,076,985 | 966,276 | 1,041,008 | ||||||||||||
9.25% senior notes due January 2019
|
1,125,000 | 1,414,856 | 1,125,000 | 1,393,943 | ||||||||||||
5.00% senior notes due September 2020
|
697,114 | 694,799 | 697,037 | 678,335 | ||||||||||||
5.375% senior notes due August 2012(1)
|
274,134 | 288,750 | 273,977 | 291,500 | ||||||||||||
Subsidiary preferred stock
|
69,188 | 68,625 | 69,188 | 68,625 | ||||||||||||
Other
|
2,107 | 2,107 | 2,676 | 2,676 | ||||||||||||
$ | 4,524,447 | $ | 4,934,089 | $ | 4,512,332 | $ | 4,879,402 | |||||||||
(1) | Includes $.6 million and $.7 million as of March 31, 2011 and December 31, 2010, respectively, related to the unamortized loss on an interest rate swap that was unwound during the fourth quarter of 2005. |
Note 5 | Share-Based Compensation |
13
Note 6 | Investments in Unconsolidated Affiliates |
Three Months Ended |
||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Gross revenues
|
$ | 82,203 | $ | 39,671 | ||||
Gross margin
|
69,814 | 33,804 | ||||||
Net income (loss)
|
30,473 | 13,507 | ||||||
Nabors earnings (losses) from our U.S. oil and gas joint
venture
|
15,160 | 6,709 |
Note 7 | Debt |
March 31, |
December 31, |
|||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
0.94% senior exchangeable notes due May 2011
|
$ | 1,390,325 | $ | 1,378,178 | ||||
6.15% senior notes due February 2018
|
966,579 | 966,276 | ||||||
9.25% senior notes due January 2019
|
1,125,000 | 1,125,000 | ||||||
5.00% senior notes due September 2020
|
697,114 | 697,037 | ||||||
5.375% senior notes due August 2012
|
274,134 | 273,977 | ||||||
Other
|
2,107 | 2,676 | ||||||
4,455,259 | 4,443,144 | |||||||
Less: current portion
|
1,391,224 | 1,379,018 | ||||||
$ | 3,064,035 | $ | 3,064,126 | |||||
14
March 31, |
||||
2011 | ||||
(In thousands) | ||||
Credit available
|
$ | 246,789 | ||
Letters of credit outstanding, inclusive of financial and
performance guarantees
|
83,946 | |||
Remaining availability
|
$ | 162,843 | ||
Note 8 | Common Shares |
15
Note 9 | Commitments and Contingencies |
| In the event of Mr. Isenbergs Termination Without Cause (including in the event of a change of control), or his death or disability, either he or his estate would be entitled to receive a payment of $100 million within 30 days thereafter. | |
| If Mr. Petrello experienced such a triggering event, he or his estate would be entitled to receive within 30 days thereafter a payment of $50 million; provided that in the event of Termination Without Cause or Constructive Termination Without Cause, a payment equal to three times the average of his base salary and annual bonus (calculated as though the bonus formula under his employment agreement as amended in April 2009 had been in effect) during the three fiscal years preceding the termination. If, by way of example, Mr. Petrello were Terminated Without Cause subsequent to March 31, 2011, his payment would be approximately $34 million. The formula will be further reduced to two times the average stated above effective April 1, 2015. |
16
17
18
Maximum Amount | ||||||||||||||||||||
Remainder |
||||||||||||||||||||
of 2011 | 2012 | 2013 | Thereafter | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Financial standby letters of credit and other financial surety
instruments
|
$ | 262,875 | $ | 44,075 | $ | 30,271 | $ | 14,313 | $ | 351,534 |
Note 10 | Earnings (Losses) Per Share |
Three Months Ended |
||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands, except per share amounts) | ||||||||
Net income (loss) (numerator):
|
||||||||
Income (loss) from continuing operations, net of tax
|
$ | 84,326 | $ | 43,519 | ||||
Less: net (income) loss attributable to noncontrolling interest
|
669 | 1,102 | ||||||
Income (loss) from continuing operations,net of tax
basic
|
84,995 | 44,621 | ||||||
Add: interest expense on assumed conversion of our
0.94% senior exchangeable notes due 2011, net of tax(1)
|
| | ||||||
Adjusted net income (loss) from continuing operations, net of
tax diluted
|
$ | 84,995 | $ | 44,621 | ||||
Earnings (losses) per share:
|
||||||||
Basic from continuing operations
|
$ | .30 | $ | .16 | ||||
Diluted from continuing operations
|
$ | .29 | $ | .16 | ||||
Income (loss) from discontinued operations, net of tax
|
$ | (2,170 | ) | $ | (4,421 | ) | ||
Earnings (losses) per share:
|
||||||||
Basic from discontinued operations
|
$ | (.01 | ) | $ | (.02 | ) | ||
Diluted from discontinued operations
|
$ | (.01 | ) | $ | (.02 | ) | ||
Shares (denominator):
|
||||||||
Weighted-average number of shares outstanding basic
|
286,114 | 284,672 | ||||||
Net effect of dilutive stock options, warrants and restricted
stock awards based on the if-converted method
|
6,575 | 6,064 | ||||||
Assumed conversion of our 0.94% senior exchangeable notes
due 2011(1)
|
| | ||||||
Weighted-average number of shares outstanding diluted
|
292,689 | 290,736 | ||||||
(1) | Diluted earnings (losses) per share for the three months ended March 31, 2011 and 2010 exclude any incremental shares issuable upon exchange of the 0.94% senior exchangeable notes due 2011. As of March 31, 2011, we have purchased approximately $1.3 billion par value of these notes in the open market, leaving approximately $1.4 billion par value outstanding. The number of shares that we would be required to issue upon exchange consists of only the incremental shares that would be issued above the principal amount of the notes, as we are required to pay cash up to the principal amount of the notes |
19
exchanged. We would issue an incremental number of shares only upon exchange of these notes. Such shares are included in the calculation of the weighted-average number of shares outstanding in our diluted earnings per share calculation only when our stock price exceeds $45.83 as of the last trading day of the quarter and the average price of our shares for the ten consecutive trading days beginning on the third business day after the last trading day of the quarter exceeds $45.83, which did not occur during any period for the three months ended March 31, 2011 and 2010. |
Note 11 | Supplemental Balance Sheet, Income Statement and Cash Flow Information |
March 31, |
December 31, |
|||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Accrued compensation
|
$ | 134,886 | $ | 116,680 | ||||
Deferred revenue
|
107,619 | 88,389 | ||||||
Other taxes payable
|
28,984 | 25,227 | ||||||
Workers compensation liabilities
|
21,489 | 31,944 | ||||||
Interest payable
|
38,822 | 89,276 | ||||||
Due to joint venture partners
|
6,041 | 6,030 | ||||||
Warranty accrual
|
3,384 | 3,376 | ||||||
Litigation reserves
|
16,690 | 12,301 | ||||||
Professional fees
|
6,287 | 3,222 | ||||||
Current deferred tax liability
|
| 1,027 | ||||||
Other accrued liabilities
|
12,513 | 16,820 | ||||||
$ | 376,715 | $ | 394,292 | |||||
Three Months Ended |
||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Interest and dividend income
|
$ | 1,832 | $ | 1,234 | ||||
Gains (losses) on marketable and non-marketable securities,
net(1)
|
10,455 | (2) | (3,791 | ) | ||||
$ | 12,287 | $ | (2,557 | ) | ||||
(1) | Includes unrealized losses of $3.2 million and $4.5 million, respectively, from our trading securities. |
20
(2) | Includes $12.9 million realized gain related to one of our overseas fund investments classified as long-term investments, partially offset by unrealized losses discussed above. |
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Losses (gains) on sales and retirements of long-lived assets
|
$ | 1,084 | $ | 3,515 | ||||
Litigation expenses
|
5,919 | 3,731 | ||||||
Foreign currency transaction losses (gains)
|
(535 | ) | 9,332 | (1) | ||||
Losses (gains) on derivative instruments
|
(511 | ) | 169 | |||||
Losses (gains) on debt extinguishment
|
58 | 2,804 | ||||||
Other losses (gains)
|
14 | 816 | ||||||
$ | 6,029 | $ | 20,367 | |||||
(1) | Included $8.2 million foreign currency exchange losses for operations in Venezuela related to the Venezuela governments decision to devalue its currency in January 2010. |
Note 12 | Discontinued Operations |
Three Months Ended March 31, | ||||||||
Condensed Statements of Income (Loss) from Discontinued Operations | 2011 | 2010 | ||||||
(In thousands) | ||||||||
Operating revenues and Earnings (losses) from unconsolidated
affiliates
|
$ | 8,302 | $ | 6,722 | ||||
Income (loss) from discontinued operations
|
||||||||
Income (loss) from discontinued operations
|
$ | (2,898 | ) | $ | (3,067 | ) | ||
Less: income tax expense (benefit)
|
728 | (1,354 | ) | |||||
Income (loss) from discontinued operations, net of tax
|
$ | (2,170 | ) | $ | (4,421 | ) | ||
21
Note 13 | Segment Information |
Three Months Ended |
||||||||
March 31, | ||||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Operating revenues and earnings (losses) from unconsolidated
affiliates from continuing operations:(1)
|
||||||||
Contract Drilling:(2)
|
||||||||
U.S. Lower 48 Land Drilling
|
$ | 378,568 | $ | 271,497 | ||||
U.S. Land Well-servicing
|
150,256 | 97,991 | ||||||
Pressure Pumping(3)
|
257,859 | | ||||||
U.S. Offshore
|
30,454 | 38,198 | ||||||
Alaska
|
41,315 | 49,794 | ||||||
Canada
|
172,443 | 115,556 | ||||||
International
|
262,477 | 245,344 | ||||||
Subtotal Contract Drilling(4)
|
1,293,372 | 818,380 | ||||||
Oil and Gas(5)
|
20,128 | 10,602 | ||||||
Other Operating Segments(6)(7)
|
121,383 | 95,513 | ||||||
Other reconciling items(8)
|
(37,330 | ) | (25,507 | ) | ||||
Total
|
$ | 1,397,553 | $ | 898,988 | ||||
Adjusted income (loss) derived from operating activities from
continuing operations:(1)(9)
|
||||||||
Contract Drilling:
|
||||||||
U.S. Lower 48 Land Drilling
|
$ | 80,095 | $ | 60,286 | ||||
U.S. Land Well-servicing
|
11,123 | 7,185 | ||||||
Pressure Pumping(3)
|
43,715 | | ||||||
U.S. Offshore
|
(3,977 | ) | 7,373 | |||||
Alaska
|
11,019 | 13,957 | ||||||
Canada
|
38,992 | 14,882 | ||||||
International
|
35,497 | 53,579 | ||||||
Subtotal Contract Drilling(4)
|
216,464 | 157,262 | ||||||
Oil and Gas(5)
|
(770 | ) | 2,619 | |||||
Other Operating Segments(6)(7)
|
6,138 | 6,890 | ||||||
Other reconciling items(10)
|
(30,783 | ) | (24,969 | ) | ||||
Total adjusted income derived from operating activities
|
$ | 191,049 | $ | 141,802 | ||||
Interest expense
|
(73,924 | ) | (66,769 | ) | ||||
Investment income (loss)
|
12,287 | (2,557 | ) | |||||
Gains (losses) on sales and retirements of long-lived assets and
other income (expense), net
|
(6,029 | ) | (20,367 | ) | ||||
Income (loss) from continuing operations before income taxes
|
123,383 | 52,109 | ||||||
Income tax expense (benefit)
|
38,307 | 8,590 | ||||||
Subsidiary preferred stock dividend
|
(750 | ) | | |||||
Income (loss) from continuing operations, net of tax
|
84,326 | 43,519 | ||||||
Income (loss) from discontinued operations, net of tax
|
(2,170 | ) | (4,421 | ) | ||||
Net income (loss)
|
82,156 | 39,098 | ||||||
Less: Net income (loss) attributable to noncontrolling interest
|
669 | 1,102 | ||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | $ | 40,200 | ||||
22
March 31, |
December 31, |
|||||||
2011 | 2010 | |||||||
(In thousands) | ||||||||
Total assets:
|
||||||||
Contract Drilling:(11)
|
||||||||
U.S. Lower 48 Land Drilling
|
$ | 2,813,396 | $ | 2,762,362 | ||||
U.S. Land Well-servicing
|
708,911 | 630,518 | ||||||
Pressure Pumping(3)
|
1,134,282 | 1,163,236 | ||||||
U.S. Offshore
|
379,272 | 379,292 | ||||||
Alaska
|
301,251 | 313,123 | ||||||
Canada
|
1,140,759 | 1,065,268 | ||||||
International
|
3,304,662 | 3,279,763 | ||||||
Subtotal Contract Drilling
|
9,782,533 | 9,593,562 | ||||||
Oil and Gas(12)
|
896,643 | 805,410 | ||||||
Other Operating Segments(13)
|
569,401 | 539,373 | ||||||
Other reconciling items(10)(14)
|
641,831 | 708,224 | ||||||
Total assets
|
$ | 11,890,408 | $ | 11,646,569 | ||||
(1) | All information presents the operating activities of oil and gas assets in the Horn River basin in Canada and in the Llanos basin in Colombia as discontinued operations. | |
(2) | These segments include our drilling, workover and well-servicing and pressure pumping operations, on land and offshore. | |
(3) | Includes operating results of Superior for the three months ended March 31, 2011. | |
(4) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $.2 million and $.1 million for the three months ended March 31, 2011 and 2010, respectively. | |
(5) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $15.2 million and $4.5 million for the three months ended March 31, 2011 and 2010, respectively. | |
(6) | Includes our drilling technology and top drive manufacturing, directional drilling, rig instrumentation and software, and construction and logistics operations. | |
(7) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $.9 million and $3.0 million for the three months ended March 31, 2011 and 2010, respectively. | |
(8) | Represents the elimination of inter-segment transactions. | |
(9) | Adjusted income (loss) derived from operating activities is computed by subtracting direct costs, general and administrative expenses, depreciation and amortization, and depletion expense from Operating revenues and then adding Earnings (losses) from unconsolidated affiliates. Such amounts should not be used as a substitute for those amounts reported under 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 are an accurate reflection of our ongoing profitability. A reconciliation of this non-GAAP measure to income (loss) before income taxes, which is a GAAP measure, is provided within the above table. | |
(10) | Represents the elimination of inter-segment transactions and unallocated corporate expenses, assets and capital expenditures. | |
(11) | Includes $55.0 million and $54.8 million of investments in unconsolidated affiliates accounted for using the equity method as of March 31, 2011 and December 31, 2010, respectively. | |
(12) | Includes $178.1 million and $146.5 million investments in unconsolidated affiliates accounted for using the equity method as of March 31, 2011 and December 31, 2010, respectively. | |
(13) | Includes $65.4 million and $64.5 million of investments in unconsolidated affiliates accounted for using the equity method as of March 31, 2011 and December 31, 2010, respectively. |
23
(14) | Includes $1.9 million of investments in unconsolidated affiliates accounted for using the cost method as of each of March 31, 2011 and December 31, 2010. |
Note 14 | Condensed Consolidating Financial Information |
24
March 31, 2011 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS
|
||||||||||||||||||||
Current assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 6,443 | $ | 20 | $ | 563,273 | $ | | $ | 569,736 | ||||||||||
Short-term investments
|
| | 160,571 | | 160,571 | |||||||||||||||
Assets held for sale
|
| | 357,516 | | 357,516 | |||||||||||||||
Accounts receivable, net
|
| | 1,242,954 | | 1,242,954 | |||||||||||||||
Inventory
|
| | 195,230 | | 195,230 | |||||||||||||||
Deferred income taxes
|
| | 21,214 | | 21,214 | |||||||||||||||
Other current assets
|
50 | 16,078 | 147,781 | | 163,909 | |||||||||||||||
Total current assets
|
6,493 | 16,098 | 2,688,539 | | 2,711,130 | |||||||||||||||
Long-term investments and other receivables
|
| | 43,744 | | 43,744 | |||||||||||||||
Property, plant and equipment, net
|
| 43,598 | 7,932,359 | | 7,975,957 | |||||||||||||||
Goodwill
|
| | 494,005 | | 494,005 | |||||||||||||||
Intercompany receivables
|
164,618 | | 322,697 | (487,315 | ) | | ||||||||||||||
Investment in unconsolidated affiliates
|
5,290,981 | 5,874,287 | 1,721,104 | (12,585,947 | ) | 300,425 | ||||||||||||||
Other long-term assets
|
| 35,075 | 330,072 | | 365,147 | |||||||||||||||
Total assets
|
$ | 5,462,092 | $ | 5,969,058 | $ | 13,532,520 | $ | (13,073,262 | ) | $ | 11,890,408 | |||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Current liabilities:
|
||||||||||||||||||||
Current portion of long-term debt
|
$ | | $ | 1,390,324 | $ | 900 | $ | | $ | 1,391,224 | ||||||||||
Trade accounts payable
|
15 | | 433,680 | | 433,695 | |||||||||||||||
Accrued liabilities
|
2,172 | 39,212 | 335,331 | | 376,715 | |||||||||||||||
Income taxes payable
|
| 5,870 | 23,088 | | 28,958 | |||||||||||||||
Total current liabilities
|
2,187 | 1,435,406 | 792,999 | | 2,230,592 | |||||||||||||||
Long-term debt
|
| 3,062,827 | 1,208 | | 3,064,035 | |||||||||||||||
Other long-term liabilities
|
| 39,927 | 222,629 | | 262,556 | |||||||||||||||
Deferred income taxes
|
| 67,467 | 722,276 | | 789,743 | |||||||||||||||
Intercompany payable
|
| 351,937 | 135,378 | (487,315 | ) | | ||||||||||||||
Total liabilities
|
2,187 | 4,957,564 | 1,874,490 | (487,315 | ) | 6,346,926 | ||||||||||||||
Subsidiary preferred stock
|
| | 69,188 | | 69,188 | |||||||||||||||
Shareholders equity
|
5,459,905 | 1,011,494 | 11,574,453 | (12,585,947 | ) | 5,459,905 | ||||||||||||||
Noncontrolling interest
|
| | 14,389 | | 14,389 | |||||||||||||||
Total equity
|
5,459,905 | 1,011,494 | 11,588,842 | (12,585,947 | ) | 5,474,294 | ||||||||||||||
Total liabilities and equity
|
$ | 5,462,092 | $ | 5,969,058 | $ | 13,532,520 | $ | (13,073,262 | ) | $ | 11,890,408 | |||||||||
25
December 31, 2010 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
ASSETS
|
||||||||||||||||||||
Current assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 10,847 | $ | 20 | $ | 630,835 | $ | | $ | 641,702 | ||||||||||
Short-term investments
|
| | 159,488 | | 159,488 | |||||||||||||||
Assets held for sale
|
| | 352,048 | | 352,048 | |||||||||||||||
Accounts receivable, net
|
| | 1,116,510 | | 1,116,510 | |||||||||||||||
Inventory
|
| | 158,836 | | 158,836 | |||||||||||||||
Deferred income taxes
|
| | 31,510 | | 31,510 | |||||||||||||||
Other current assets
|
50 | 16,366 | 136,420 | | 152,836 | |||||||||||||||
Total current assets
|
10,897 | 16,386 | 2,585,647 | | 2,612,930 | |||||||||||||||
Long-term investments and other receivables
|
| | 40,300 | | 40,300 | |||||||||||||||
Property, plant and equipment, net
|
| 44,270 | 7,771,149 | | 7,815,419 | |||||||||||||||
Goodwill
|
| | 494,372 | | 494,372 | |||||||||||||||
Intercompany receivables
|
160,250 | | 322,697 | (482,947 | ) | | ||||||||||||||
Investment in unconsolidated affiliates
|
5,160,800 | 5,814,219 | 1,665,459 | (12,372,755 | ) | 267,723 | ||||||||||||||
Other long-term assets
|
| 36,538 | 379,287 | | 415,825 | |||||||||||||||
Total assets
|
$ | 5,331,947 | $ | 5,911,413 | $ | 13,258,911 | $ | (12,855,702 | ) | $ | 11,646,569 | |||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Current liabilities:
|
||||||||||||||||||||
Current portion of long-term debt
|
$ | | $ | 1,378,178 | $ | 840 | $ | | $ | 1,379,018 | ||||||||||
Trade accounts payable
|
| | 355,282 | | 355,282 | |||||||||||||||
Accrued liabilities
|
3,785 | 89,480 | 301,027 | | 394,292 | |||||||||||||||
Income taxes payable
|
| 6,859 | 18,929 | | 25,788 | |||||||||||||||
Total current liabilities
|
3,785 | 1,474,517 | 676,078 | | 2,154,380 | |||||||||||||||
Long-term debt
|
| 3,062,291 | 1,835 | | 3,064,126 | |||||||||||||||
Other long-term liabilities
|
| 12,787 | 232,978 | | 245,765 | |||||||||||||||
Deferred income taxes
|
| 71,815 | 698,432 | | 770,247 | |||||||||||||||
Intercompany payable
|
| 301,451 | 181,496 | (482,947 | ) | | ||||||||||||||
Total liabilities
|
3,785 | 4,922,861 | 1,790,819 | (482,947 | ) | 6,234,518 | ||||||||||||||
Subsidiary preferred stock
|
| | 69,188 | | 69,188 | |||||||||||||||
Shareholders equity
|
5,328,162 | 988,552 | 11,384,203 | (12,372,755 | ) | 5,328,162 | ||||||||||||||
Noncontrolling interest
|
| | 14,701 | | 14,701 | |||||||||||||||
Total equity
|
5,328,162 | 988,552 | 11,398,904 | (12,372,755 | ) | 5,342,863 | ||||||||||||||
Total liabilities and equity
|
$ | 5,331,947 | $ | 5,911,413 | $ | 13,258,911 | $ | (12,855,702 | ) | $ | 11,646,569 | |||||||||
26
Three Months Ended March 31, 2011 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Revenues and other income:
|
||||||||||||||||||||
Operating revenues
|
$ | | $ | | $ | 1,381,279 | $ | | $ | 1,381,279 | ||||||||||
Earnings (losses) from unconsolidated affiliates
|
| | 16,274 | | 16,274 | |||||||||||||||
Earnings (losses) from consolidated affiliates
|
85,792 | 59,893 | 29,660 | (175,345 | ) | | ||||||||||||||
Investment income (loss)
|
3 | | 12,284 | | 12,287 | |||||||||||||||
Intercompany interest income
|
| 18,684 | | (18,684 | ) | | ||||||||||||||
Total revenues and other income
|
85,795 | 78,577 | 1,439,497 | (194,029 | ) | 1,409,840 | ||||||||||||||
Costs and other deductions:
|
||||||||||||||||||||
Direct costs
|
| | 858,371 | | 858,371 | |||||||||||||||
General and administrative expenses
|
2,872 | 41 | 115,643 | (98 | ) | 118,458 | ||||||||||||||
Depreciation and amortization
|
| 871 | 225,231 | | 226,102 | |||||||||||||||
Depletion
|
| | 3,573 | | 3,573 | |||||||||||||||
Interest expense
|
| 77,349 | (3,425 | ) | | 73,924 | ||||||||||||||
Intercompany interest expense
|
| | 18,684 | (18,684 | ) | | ||||||||||||||
Losses (gains) on sales and retirements of long-lived assets and
other expense (income), net
|
98 | (464 | ) | 6,297 | 98 | 6,029 | ||||||||||||||
Total costs and other deductions
|
2,970 | 77,797 | 1,224,374 | (18,684 | ) | 1,286,457 | ||||||||||||||
Income (loss) from continuing operations before income taxes
|
82,825 | 780 | 215,123 | (175,345 | ) | 123,383 | ||||||||||||||
Income tax expense (benefit)
|
| (21,872 | ) | 60,179 | | 38,307 | ||||||||||||||
Subsidiary preferred stock dividend
|
| | 750 | | 750 | |||||||||||||||
Income (loss) from continuing operations, net of tax
|
82,825 | 22,652 | 154,194 | (175,345 | ) | 84,326 | ||||||||||||||
Income (loss) from discontinued operations, net of tax
|
| | (2,170 | ) | | (2,170 | ) | |||||||||||||
Net income (loss)
|
82,825 | 22,652 | 152,024 | (175,345 | ) | 82,156 | ||||||||||||||
Less: Net (income) loss attributable to noncontrolling interest
|
| | 669 | | 669 | |||||||||||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | $ | 22,652 | $ | 152,693 | $ | (175,345 | ) | $ | 82,825 | |||||||||
27
Three Months Ended March 31, 2010 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Revenues and other income:
|
||||||||||||||||||||
Operating revenues
|
$ | | $ | | $ | 891,346 | $ | | $ | 891,346 | ||||||||||
Earnings (losses) from unconsolidated affiliates
|
| | 7,642 | | 7,642 | |||||||||||||||
Earnings (losses) from consolidated affiliates
|
33,946 | 17,776 | (15,792 | ) | (35,930 | ) | | |||||||||||||
Investment income (loss)
|
4 | | (2,561 | ) | | (2,557 | ) | |||||||||||||
Intercompany interest income
|
| 18,115 | | (18,115 | ) | | ||||||||||||||
Total revenues and other income
|
33,950 | 35,891 | 880,635 | (54,045 | ) | 896,431 | ||||||||||||||
Costs and other deductions:
|
||||||||||||||||||||
Direct costs
|
| | 505,197 | | 505,197 | |||||||||||||||
General and administrative expenses
|
2,210 | 71 | 73,235 | (90 | ) | 75,426 | ||||||||||||||
Depreciation and amortization
|
| 861 | 170,675 | | 171,536 | |||||||||||||||
Depletion
|
| | 5,027 | | 5,027 | |||||||||||||||
Interest expense
|
| 70,199 | (3,430 | ) | | 66,769 | ||||||||||||||
Intercompany interest expense
|
| | 18,115 | (18,115 | ) | | ||||||||||||||
Losses (gains) on sales and retirements of long-lived assets and
other expense (income), net
|
(8,460 | ) | 11,511 | 17,226 | 90 | 20,367 | ||||||||||||||
Total costs and other deductions
|
(6,250 | ) | 82,642 | 786,045 | (18,115 | ) | 844,322 | |||||||||||||
Income (loss) from continuing operations before income taxes
|
40,200 | (46,751 | ) | 94,590 | (35,930 | ) | 52,109 | |||||||||||||
Income tax expense (benefit)
|
| (23,875 | ) | 32,465 | | 8,590 | ||||||||||||||
Income (loss) from continuing operations, net of tax
|
40,200 | (22,876 | ) | 62,125 | (35,930 | ) | 43,519 | |||||||||||||
Income (loss) from discontinued operations, net of tax
|
| | (4,421 | ) | | (4,421 | ) | |||||||||||||
Net income (loss)
|
40,200 | (22,876 | ) | 57,704 | (35,930 | ) | 39,098 | |||||||||||||
Less: Net (income) loss attributable to noncontrolling interest
|
| | 1,102 | | 1,102 | |||||||||||||||
Net income (loss) attributable to Nabors
|
$ | 40,200 | $ | (22,876 | ) | $ | 58,806 | $ | (35,930 | ) | $ | 40,200 | ||||||||
28
Three Months Ended March 31, 2011 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided by (used for) operating activities
|
$ | (4,988 | ) | $ | 5,003 | $ | 290,909 | $ | | $ | 290,924 | |||||||||
Cash flows from investing activities:
|
||||||||||||||||||||
Purchases of investments
|
| | (5,870 | ) | | (5,870 | ) | |||||||||||||
Sales and maturities of investments
|
| | 3,529 | | 3,529 | |||||||||||||||
Cash paid for acquisition of businesses, net
|
| | | | | |||||||||||||||
Investment in unconsolidated affiliates
|
| | (19,000 | ) | | (19,000 | ) | |||||||||||||
Capital expenditures
|
| | (358,574 | ) | | (358,574 | ) | |||||||||||||
Proceeds from sales of assets and insurance claims
|
| | 5,491 | | 5,491 | |||||||||||||||
Cash paid for investments in consolidated affiliates
|
(6,500 | ) | | | 6,500 | | ||||||||||||||
Net cash provided by (used for) investing activities
|
(6,500 | ) | | (374,424 | ) | 6,500 | (374,424 | ) | ||||||||||||
Cash flows from financing activities:
|
||||||||||||||||||||
Increase (decrease) in cash overdrafts
|
| | 7,565 | | 7,565 | |||||||||||||||
Proceeds from issuance of common shares
|
9,424 | | | | 9,424 | |||||||||||||||
Reduction in long-term debt
|
| (4,988 | ) | (572 | ) | | (5,560 | ) | ||||||||||||
Repurchase of equity component of convertible debt
|
| (14 | ) | | | (14 | ) | |||||||||||||
Purchase of restricted stock
|
(2,340 | ) | | | | (2,340 | ) | |||||||||||||
Tax benefit related to share-based awards
|
| (1 | ) | | (1 | ) | ||||||||||||||
Proceeds from parent contributions
|
| | 6,500 | (6,500 | ) | | ||||||||||||||
Net cash (used for) provided by financing activities
|
7,084 | (5,003 | ) | 13,493 | (6,500 | ) | 9,074 | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
| | 2,460 | | 2,460 | |||||||||||||||
Net (decrease) increase in cash and cash equivalents
|
(4,404 | ) | | (67,562 | ) | | (71,966 | ) | ||||||||||||
Cash and cash equivalents, beginning of period
|
10,847 | 20 | 630,835 | | 641,702 | |||||||||||||||
Cash and cash equivalents, end of period
|
$ | 6,443 | $ | 20 | $ | 563,273 | $ | | $ | 569,736 | ||||||||||
29
Three Months Ended March 31, 2010 | ||||||||||||||||||||
Nabors |
Other |
|||||||||||||||||||
Nabors |
Delaware |
Subsidiaries |
||||||||||||||||||
(Parent/ |
(Issuer/ |
(Non- |
Consolidating |
Consolidated |
||||||||||||||||
Guarantor) | Guarantor) | Guarantors) | Adjustments | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net cash provided by (used for) operating activities
|
$ | 53,002 | $ | 109,255 | $ | 60,890 | $ | | $ | 223,147 | ||||||||||
Cash flows from investing activities:
|
||||||||||||||||||||
Purchases of investments
|
| | (4,384 | ) | | (4,384 | ) | |||||||||||||
Sales and maturities of investments
|
| | 12,509 | | 12,509 | |||||||||||||||
Investment in unconsolidated affiliates
|
| | (995 | ) | | (995 | ) | |||||||||||||
Capital expenditures
|
| | (150,740 | ) | | (150,740 | ) | |||||||||||||
Proceeds from sales of assets and insurance claims
|
| | 8,682 | | 8,682 | |||||||||||||||
Cash paid for investments in consolidated affiliates
|
(64,000 | ) | | | 64,000 | | ||||||||||||||
Net cash provided by (used for) investing activities
|
(64,000 | ) | | (134,928 | ) | 64,000 | (134,928 | ) | ||||||||||||
Cash flows from financing activities:
|
||||||||||||||||||||
Increase (decrease) in cash overdrafts
|
| | (3,337 | ) | | (3,337 | ) | |||||||||||||
Proceeds from issuance of common shares
|
2,818 | | | | 2,818 | |||||||||||||||
Reduction in long-term debt
|
| (106,759 | ) | (72 | ) | | (106,831 | ) | ||||||||||||
Repurchase of equity component of convertible debt
|
| (2,611 | ) | | | (2,611 | ) | |||||||||||||
Settlement of call options and warrants, net
|
| 400 | | | 400 | |||||||||||||||
Purchase of restricted stock
|
(1,866 | ) | | | | (1,866 | ) | |||||||||||||
Tax benefit related to share-based awards
|
| | (67 | ) | | (67 | ) | |||||||||||||
Proceeds from parent contributions
|
| | 64,000 | (64,000 | ) | | ||||||||||||||
Net cash (used for) provided by financing activities
|
952 | (108,970 | ) | 60,524 | (64,000 | ) | (111,494 | ) | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
| | (1,931 | ) | | (1,931 | ) | |||||||||||||
Net (decrease) increase in cash and cash equivalents
|
(10,046 | ) | 285 | (15,445 | ) | | (25,206 | ) | ||||||||||||
Cash and cash equivalents, beginning of period
|
11,702 | 135 | 915,978 | | 927,815 | |||||||||||||||
Cash and cash equivalents, end of period
|
$ | 1,656 | $ | 420 | $ | 900,533 | $ | | $ | 902,609 | ||||||||||
30
Note 15 | Subsequent Events |
31
32
ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
| fluctuations in worldwide prices of and demand for natural gas and oil; | |
| fluctuations in levels of natural gas and oil exploration and development activities; | |
| fluctuations in the demand for our services; | |
| the existence of competitors, technological changes and developments in the oilfield services industry; | |
| the existence of operating risks inherent in the oilfield services industry; | |
| the possibility of changes in tax and other laws and regulations; | |
| the possibility of political instability, war or acts of terrorism in any of the countries where we operate; and | |
| general economic conditions including the capital and credit markets. |
33
| An increase in drilling in oil- and liquids-rich areas incremental to traditional dry gas regions by our U.S. Lower 48 Land Drilling and Well-servicing operations, | |
| An expected incremental increase from ancillary well-site services, primarily technical pumping services and down-hole surveying services, resulting from the Superior acquisition in the third quarter of 2010, and | |
| The anticipated positive impact on our overall level of drilling and well-servicing activity and margins resulting from the new and upgraded rigs added to our fleet over the past five years, which we expect will enhance our competitive position as market conditions improve. |
34
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Reportable segments:
|
||||||||||||||||
Operating revenues and Earnings (losses) from unconsolidated
affiliates from continuing operations:(1)
|
||||||||||||||||
Contract Drilling:(2)
|
||||||||||||||||
U.S. Lower 48 Land Drilling
|
$ | 378,568 | $ | 271,497 | $ | 107,071 | 39 | % | ||||||||
U.S. Land Well-servicing
|
150,256 | 97,991 | 52,265 | 53 | % | |||||||||||
Pressure Pumping(3)
|
257,859 | | 257,859 | 100 | % | |||||||||||
U.S. Offshore
|
30,454 | 38,198 | (7,744 | ) | (20 | )% | ||||||||||
Alaska
|
41,315 | 49,794 | (8,479 | ) | (17 | )% | ||||||||||
Canada
|
172,443 | 115,556 | 56,887 | 49 | % | |||||||||||
International
|
262,477 | 245,344 | 17,133 | 7 | % | |||||||||||
Subtotal Contract Drilling(4)
|
1,293,372 | 818,380 | 474,992 | 58 | % | |||||||||||
Oil and Gas(5)
|
20,128 | 10,602 | 9,526 | 90 | % | |||||||||||
Other Operating Segments(6)(7)
|
121,383 | 95,513 | 25,870 | 27 | % | |||||||||||
Other reconciling items(8)
|
(37,330 | ) | (25,507 | ) | (11,823 | ) | (46 | )% | ||||||||
Total
|
$ | 1,397,553 | $ | 898,988 | $ | 498,565 | 55 | % | ||||||||
Adjusted income (loss) derived from operating activities from
continuing operations:(1)(9)
|
||||||||||||||||
Contract Drilling:
|
||||||||||||||||
U.S. Lower 48 Land Drilling
|
$ | 80,095 | $ | 60,286 | $ | 19,809 | 33 | % | ||||||||
U.S. Land Well-servicing
|
11,123 | 7,185 | 3,938 | 55 | % | |||||||||||
Pressure Pumping(3)
|
43,715 | | 43,715 | 100 | % | |||||||||||
U.S. Offshore
|
(3,977 | ) | 7,373 | (11,350 | ) | (154 | )% | |||||||||
Alaska
|
11,019 | 13,957 | (2,938 | ) | (21 | )% | ||||||||||
Canada
|
38,992 | 14,882 | 24,110 | 162 | % | |||||||||||
International
|
35,497 | 53,579 | (18,082 | ) | (34 | )% | ||||||||||
Subtotal Contract Drilling(4)
|
216,464 | 157,262 | 59,202 | 38 | % | |||||||||||
Oil and Gas(5)
|
(770 | ) | 2,619 | (3,389 | ) | (129 | )% | |||||||||
Other Operating Segments(6)(7)
|
6,138 | 6,890 | (752 | ) | (11 | )% | ||||||||||
Other reconciling items(10)
|
(30,783 | ) | (24,969 | ) | (5,814 | ) | (23 | )% | ||||||||
Total
|
$ | 191,049 | $ | 141,802 | $ | 49,247 | 35 | % | ||||||||
Interest expense
|
(73,924 | ) | (66,769 | ) | (7,155 | ) | (11 | )% | ||||||||
Investment income (loss)
|
12,287 | (2,557 | ) | 14,844 | 581 | % | ||||||||||
Gains (losses) on sales and retirements of long-lived assets and
other income (expense), net
|
(6,029 | ) | (20,367 | ) | 14,338 | 70 | % | |||||||||
Income (loss) from continuing operations before income taxes
|
123,383 | 52,109 | 71,274 | 137 | % |
35
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Income tax expense (benefit)
|
38,307 | 8,590 | 29,717 | 346 | % | |||||||||||
Subsidiary preferred stock dividend
|
750 | | 750 | 100 | % | |||||||||||
Income (loss) from continuing operations, net of tax
|
84,326 | 43,519 | 40,807 | 94 | % | |||||||||||
Income (loss) from discontinued operations, net of tax
|
(2,170 | ) | (4,421 | ) | 2,251 | 51 | % | |||||||||
Net income (loss)
|
82,156 | 39,098 | 43,058 | 110 | % | |||||||||||
Less: Net (income) loss attributable to noncontrolling interest
|
669 | 1,102 | (433 | ) | (39 | )% | ||||||||||
Net income (loss) attributable to Nabors
|
$ | 82,825 | $ | 40,200 | $ | 42,625 | 106 | % | ||||||||
Rig activity:
|
||||||||||||||||
Rig years:(11)
|
||||||||||||||||
U.S. Lower 48 Land Drilling
|
187.9 | 158.6 | 29.3 | 18 | % | |||||||||||
U.S. Offshore
|
8.0 | 12.0 | (4.0 | ) | (33 | )% | ||||||||||
Alaska
|
5.3 | 9.1 | (3.8 | ) | (42 | )% | ||||||||||
Canada
|
49.7 | 34.8 | 14.9 | 43 | % | |||||||||||
International(12)
|
99.6 | 88.3 | 11.3 | 13 | % | |||||||||||
Total rig years
|
350.5 | 302.8 | 47.7 | 16 | % | |||||||||||
Rig hours:(13)
|
||||||||||||||||
U.S. Land Well-servicing
|
187,581 | 148,347 | 39,234 | 26 | % | |||||||||||
Canada Well-servicing
|
53,154 | 46,032 | 7,122 | 15 | % | |||||||||||
Total rig hours
|
240,735 | 194,379 | 46,356 | 24 | % | |||||||||||
(1) | All information presents the operating activities of oil and gas assets in the Horn River basin in Canada and in the Llanos basin in Colombia as discontinued operations. | |
(2) | These segments include our drilling, workover and well-servicing and pressure pumping operations, on land and offshore. | |
(3) | Includes operating results of Superior for the three months ended March 31, 2011. | |
(4) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $.2 million and $.1 million for the three months ended March 31, 2011 and 2010, respectively. | |
(5) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $15.2 million and $4.5 million for the three months ended March 31, 2011 and 2010, respectively. | |
(6) | Includes our drilling technology and top drive manufacturing, directional drilling, rig instrumentation and software, and construction and logistics operations. | |
(7) | Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of $.9 million and $3.0 million for the three months ended March 31, 2011 and 2010, respectively. | |
(8) | Represents the elimination of inter-segment transactions. | |
(9) | Adjusted income (loss) derived from operating activities is computed by subtracting direct costs, general and administrative expenses, depreciation and amortization, and depletion expense from Operating revenues and then adding Earnings (losses) from unconsolidated affiliates. These amounts should not be used as a substitute for those amounts reported under 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 are an accurate reflection of our ongoing profitability. A reconciliation of this non-GAAP measure to income |
36
(loss) from continuing operations before income taxes, which is a GAAP measure, is provided within the above table. | ||
(10) | Represents the elimination of inter-segment transactions and unallocated corporate expenses. | |
(11) | 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. | |
(12) | International rig years include our equivalent percentage ownership of rigs owned by unconsolidated affiliates which totaled 2.0 years and 2.5 years during the three months ended March 31, 2011 and 2010, respectively. | |
(13) | Rig hours represents the number of hours that our well-servicing rig fleet operated during the year. |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues
|
$ | 378,568 | $ | 271,497 | $ | 107,071 | 39 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 80,095 | $ | 60,286 | $ | 19,809 | 33 | % | ||||||||
Rig years
|
187.9 | 158.6 | 29.3 | 18 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues
|
$ | 150,256 | $ | 97,991 | $ | 52,265 | 53 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 11,123 | $ | 7,185 | $ | 3,938 | 55 | % | ||||||||
Rig hours
|
187,581 | 148,347 | 39,234 | 26 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Operating revenues
|
$ | 257,859 | $ | | $ | 257,859 | 100 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 43,715 | $ | | $ | 43,715 | 100 | % |
37
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues
|
$ | 30,454 | $ | 38,198 | $ | (7,744 | ) | (20 | )% | |||||||
Adjusted income (loss) derived from operating activities
|
$ | (3,977 | ) | $ | 7,373 | $ | (11,350 | ) | (154 | )% | ||||||
Rig years
|
8.0 | 12.0 | (4.0 | ) | (33 | )% |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues and Earnings from unconsolidated affiliates
|
$ | 41,315 | $ | 49,794 | $ | (8,479 | ) | (17 | )% | |||||||
Adjusted income derived from operating activities
|
$ | 11,019 | $ | 13,957 | $ | (2,938 | ) | (21 | )% | |||||||
Rig years
|
5.3 | 9.1 | (3.8 | ) | (42 | )% |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues and Earnings from unconsolidated affiliates
|
$ | 172,443 | $ | 115,556 | $ | 56,887 | 49 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 38,992 | $ | 14,882 | $ | 24,110 | 162 | % | ||||||||
Rig years
|
49.7 | 34.8 | 14.9 | 43 | % | |||||||||||
Rig hours
|
53,154 | 46,032 | 7,122 | 15 | % |
38
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages and rig activity) | ||||||||||||||||
Operating revenues and Earnings from unconsolidated affiliates
|
$ | 262,477 | $ | 245,344 | $ | 17,133 | 7 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 35,497 | $ | 53,579 | $ | (18,082 | ) | (34 | )% | |||||||
Rig years
|
99.6 | 88.3 | 11.3 | 13 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Operating revenues and Earnings from unconsolidated affiliates
|
$ | 20,128 | $ | 10,602 | $ | 9,526 | 90 | % | ||||||||
Adjusted income (loss) derived from operating activities
|
$ | (770 | ) | $ | 2,619 | $ | (3,389 | ) | (129 | )% |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Operating revenues and Earnings from unconsolidated affiliates
|
$ | 121,383 | $ | 95,513 | $ | 25,870 | 27 | % | ||||||||
Adjusted income derived from operating activities
|
$ | 6,138 | $ | 6,890 | $ | (752 | ) | (11 | )% |
39
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Operating revenues and Earnings (losses) from unconsolidated
affiliates
|
$ | 8,302 | $ | 6,722 | $ | 1,580 | 24 | % | ||||||||
Income (loss) from discontinued operations, net of tax
|
$ | (2,170 | ) | $ | (4,421 | ) | $ | 2,251 | 51 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
General and administrative expenses
|
$ | 118,458 | $ | 75,426 | $ | 43,032 | 57 | % | ||||||||
General and administrative expenses as a percentage of operating
revenues
|
8.6 | % | 8.5 | % | .1 | % | 1 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Depreciation and amortization expense
|
$ | 226,102 | $ | 171,536 | $ | 54,566 | 32 | % | ||||||||
Depletion expense
|
$ | 3,573 | $ | 5,027 | $ | (1,454 | ) | (29 | )% |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Interest expense
|
$ | 73,924 | $ | 66,769 | $ | 7,155 | 11 | % |
40
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Investment income (loss)
|
$ | 12,287 | $ | (2,557 | ) | $ | 14,844 | 581 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
(In thousands, except percentages) | ||||||||||||||||
Gains (losses) on sales and retirements of long-lived assets and
other income (expense), net
|
$ | (6,029 | ) | $ | (20,367 | ) | $ | 14,338 | 70 | % |
Three Months Ended |
||||||||||||||||
March 31, | ||||||||||||||||
2011 | 2010 | Increase (Decrease) | ||||||||||||||
Effective income tax rate from continuing operations
|
31.0 | % | 16.5 | % | 14.5 | % | 88 | % |
41
42
43
44
(In thousands) | ||||
Credit available
|
$ | 246,789 | ||
Letters of credit outstanding, inclusive of financial and
performance guarantees
|
83,946 | |||
Remaining availability
|
$ | 162,843 | ||
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
45
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
46
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Approximate |
||||||||||||||||
Total Number |
Dollar Value |
|||||||||||||||
Total Number |
Average |
of Shares Purchased |
of Shares that May |
|||||||||||||
of Shares |
Price Paid |
as Part of Publicly |
Yet Be Purchased |
|||||||||||||
Period | Purchased(1) | per Share | Announced Program | Under the Program(2) | ||||||||||||
(In thousands, except average price paid per share) | ||||||||||||||||
Jan. 1 Jan. 31, 2011
|
| $ | 23.03 | | $ | 35,458 | ||||||||||
Feb. 1 Feb. 28, 2011
|
22 | $ | 27.92 | | $ | 35,458 | ||||||||||
Mar. 1 Mar. 31, 2011
|
64 | $ | 27.04 | | $ | 35,458 |
(1) | Shares were withheld from employees to satisfy certain tax withholding obligations due in connection with grants of stock under our 2003 Employee Stock Plan. The 2003 Employee Stock Plan provides for the withholding of shares to satisfy tax obligations, but does not specify a maximum number of shares that can be withheld for this purpose. | |
(2) | In July 2006, our Board of Directors authorized a share repurchase program under which we may repurchase up to $500 million of our common shares in the open market or in privately negotiated transactions. Through March 31, $464.5 million of our common shares had been repurchased under this program, and we had an additional $35.5 million available. |
47
Description | ||||
3 | .1 | Memorandum of Association of Nabors Industries Ltd. (incorporated by reference to Annex II to the proxy statement/prospectus included in Nabors Industries Ltd.s Registration Statement on Form S-4 (Registration No. 333-76198) filed with the Commission on May 10, 2002, as amended). | ||
3 | .2 | Amended and Restated Bye-laws of Nabors Industries Ltd. (incorporated by reference to Exhibit 4.2 to Nabors Industries Ltd.s Form 10-Q (File No. 000-49887) filed with the Commission on August 3, 2005). | ||
10 | .1 | Credit Agreement, dated as of April 20, 2011, among Nabors Industries, Inc., as borrower, Nabors Industries Ltd., as guarantor, Citigroup Global Markets Inc., Mizuho Corporate Bank, Ltd., Morgan Stanley Senior Funding, Inc. and UBS Securities LLC as Joint Lead Arrangers and Joint Bookrunners, Mizuho Corporate Bank, Ltd., Morgan Stanley Senior Funding, Inc. and UBS Securities LLC, as Documentation Agents, Citibank, N.A., as Administrative Agent and Swingline Lender and the lenders party thereto from time to time (incorporated by reference to Exhibit 10.1 to Nabors Industries Ltd.s Form 8-K (File No. 001-32657) filed with the Commission on April 20, 2011). | ||
15 | Awareness Letter of Independent Accountants* | |||
31 | .1 | Rule 13a-14(a)/15d-14(a) Certification of Eugene M. Isenberg, Chairman and Chief Executive Officer* | ||
31 | .2 | Rule 13a-14(a)/15d-14(a) Certification of R. Clark Wood, Principal Accounting and Financial Officer* | ||
32 | .1 | Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Eugene M. Isenberg, Chairman and Chief Executive Officer and R. Clark Wood, Principal Accounting and Financial Officer (furnished herewith). | ||
101 | .INS | XBRL Instance Document* | ||
101 | .SCH | XBRL Schema Document* | ||
101 | .CAL | XBRL Calculation Linkbase Document* | ||
101 | .LAB | XBRL Label Linkbase Document* | ||
101 | .PRE | XBRL Presentation Linkbase Document* | ||
101 | .DEF | XBRL Definition Linkbase Document* |