Quarterly report pursuant to Section 13 or 15(d)

Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements

v2.4.0.6
Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements
3 Months Ended
Mar. 31, 2012
Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements [Abstract]  
Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements
13. Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements

Set forth on the following pages are the consolidating condensed financial statements of Parker Drilling. The Company’s 9.125% Notes are guaranteed by substantially all of the restricted subsidiaries of Parker Drilling. There are currently no restrictions on the ability of the restricted subsidiaries to transfer funds to Parker Drilling in the form of cash dividends, loans or advances. Parker Drilling is a holding company with no operations, other than through its subsidiaries. Separate financial statements for each guarantor company are not provided as the company complies with the exception to Rule 3-10(a)(1) of Regulation S-X, set forth in sub-paragraph (f) of such rule. All guarantor subsidiaries are owned 100 percent by the parent company, all guarantees are full and unconditional and all guarantees are joint and several.

We are providing consolidating condensed financial information of the parent, Parker Drilling, the guarantor subsidiaries, and the non-guarantor subsidiaries as of March 31, 2012 and December 31, 2011 and for the three months ended March 31, 2012 and 2011. The consolidating condensed financial statements present investments in both consolidated and unconsolidated subsidiaries using the equity method of accounting.

 

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED BALANCE SHEET

(Dollars in Thousands)

(Unaudited)

 

                                         
    March 31, 2012  
    Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

ASSETS

                                       

Current assets:

                                       

Cash and cash equivalents

  $ 34,861     $ 948     $ 33,187     $ —       $ 68,996  

Accounts and notes receivable, net

    289,607       98,059       300,437       (496,897     191,206  

Rig materials and supplies

    —         (467     25,880       —         25,413  

Deferred costs

    —         —         4,989       —         4,989  

Deferred income taxes

    —         4,705       633       485       5,823  

Other tax assets

    68,326       (35,722     1,766       (307     34,063  

Assets held for sale

    —         —         5,315       —         5,315  

Other current assets

    788       325       7,528       —         8,641  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current assets

    393,582       67,848       379,735       (496,719     344,446  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

    79       514,919       235,806       —         750,804  
           

Investment in subsidiaries and intercompany advances

    758,264       (236,275     1,364,952       (1,886,941     —    
           

Other noncurrent assets

    43,682       67,371       19,285       365       130,703  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

  $ 1,195,607     $ 413,863     $ 1,999,778     $ (2,383,295   $ 1,225,953  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

                                       

Current liabilities:

                                       

Current portion of long-term debt

  $ 147,249     $ —       $ —       $ —       $ 147,249  

Accounts payable and accrued liabilities

    67,128       73,391       190,441       (211,161     119,799  

Accrued income taxes

    (702     1,684       4,557       (355     5,184  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current liabilities

    213,675       75,075       194,998       (211,516     272,232  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
           

Long-term debt

    331,000       —         —         —         331,000  

Other long-term liabilities

    8,284       6,066       15,737       —         30,087  

Long-term deferred tax liability

    5,059       26,318       (14,021     894       18,250  

Intercompany payables

    62,583       43,657       111,619       (217,859     —    

Contingencies

    —         —         —         —         —    
           

Stockholders’ equity:

                                       

Common stock

    19,584       18,049       43,003       (61,052     19,584  

Capital in excess of par value

    640,974       733,119       1,444,091       (2,177,210     640,974  

Retained earnings (accumulated deficit)

    (85,552     (488,421     204,973       283,448       (85,552
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total controlling interest stockholders’ equity

    575,006       262,747       1,692,067       (1,954,814     575,006  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Noncontrolling interest

    —         —         (622     —         (622
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Equity

    575,006       262,747       1,691,445       (1,954,814     574,384  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

  $ 1,195,607     $ 413,863     $ 1,999,778     $ (2,383,295   $ 1,225,953  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED BALANCE SHEET

(Dollars in Thousands)

(Unaudited)

 

                                         
    December 31, 2011  
    Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

ASSETS

                                       

Current assets:

                                       

Cash and cash equivalents

  $ 55,670     $ 4,212     $ 37,987     $ —       $ 97,869  

Accounts and notes receivable, net

    289,512       94,748       285,326       (485,663     183,923  

Rig materials and supplies

    —         762       29,185       —         29,947  

Deferred costs

    —         —         3,249       —         3,249  

Deferred income taxes

    —         5,311       853       486       6,650  

Other tax assets

    47,834       (25,218     2,742       —         25,358  

Assets held for sale

    —         —         5,315       —         5,315  

Other current assets

    788       6,381       8,133       —         15,302  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current assets

    393,804       86,196       372,790       (485,177     367,613  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

    79       474,942       244,787       1       719,809  

Investment in subsidiaries and intercompany advances

    720,214       (212,883     1,347,719       (1,855,050     —    

Other noncurrent assets

    44,962       66,660       16,839       363       128,824  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

  $ 1,159,059     $ 414,915     $ 1,982,135     $ (2,339,863   $ 1,216,246  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

                                       

Current liabilities:

                                       

Current portion of long-term debt

  $ 145,723     $ —       $ —       $ —       $ 145,723  

Accounts payable and accrued liabilities

    60,120       94,056       181,010       (199,936     135,250  

Accrued income taxes

    (205     921       4,121       —         4,837  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current liabilities

    205,638       94,977       185,131       (199,936     285,810  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Long-term debt

    337,000       —         —         —         337,000  

Other long-term liabilities

    8,081       9,474       15,897       —         33,452  

Long-term deferred tax liability

    1,151       25,232       (11,296     847       15,934  

Intercompany payables

    62,583       43,657       111,619       (217,859     —    

Contingencies

    —         —         —         —         —    
           

Stockholders’ equity:

                                       

Common stock

    19,508       18,049       43,003       (61,052     19,508  

Capital in excess of par value

    637,042       733,120       1,444,091       (2,177,211     637,042  

Retained earnings (accumulated deficit)

    (111,944     (509,594     194,246       315,348       (111,944
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total controlling interest stockholders’ equity

    544,606       241,575       1,681,340       (1,922,915     544,606  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Noncontrolling interest

    —         —         (556     —         (556
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Equity

    544,606       241,575       1,680,784       (1,922,915     544,050  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

  $ 1,159,059     $ 414,915     $ 1,982,135     $ (2,339,863   $ 1,216,246  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS

(Dollars in Thousands)

(Unaudited)

 

                                         
    Three Months ended March 31, 2012  
    Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

Total revenues

  $ —         99,157     $ 103,025     $ (25,613   $ 176,569  

Operating expenses

    —         43,559       76,986       (25,613     94,932  

Depreciation and amortization

    —         15,595       12,024       —         27,619  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating gross margin

    —         40,003       14,015       —         54,018  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

General and administration expense (1)

    (45     (5,374     (78     —         (5,497

Gain on disposition of assets, net

    —         418       74       —         492  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating income (loss)

    (45     35,047       14,011       —         49,013  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Other income and (expense):

                                       

Interest expense

    (9,001     (36     (1,949     2,949       (8,037

Interest income

    95       178       2,702       (2,949     26  

Changes in fair value of derivative positions

    (49     —         —         —         (49

Other

    —         13       3       —         16  

Equity in net earnings of subsidiaries

    31,900       —         —         (31,900     —    
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other income and (expense)

    22,945       155       756       (31,900     (8,044
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (benefit) before income taxes

    22,900       35,202       14,767       (31,900     40,969  
           

Income tax expense (benefit):

                                       

Current

    (8,110     11,479       6,262       —         9,631  

Deferred

    4,618       2,550       (2,156     —         5,012  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense (benefit)

    (3,492     14,029       4,106       —         14,643  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

    26,392       21,173       10,661       (31,900     26,326  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Less: Net (loss) attributable to noncontrolling interest

    —         —         (66     —         (66
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to controlling interest

  $ 26,392     $ 21,173     $ 10,727     $ (31,900   $ 26,392  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) General and administration expenses for field operations are included in operating expenses.

 

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS

(Dollars in Thousands)

(Unaudited)

 

                                         
    Three Months ended March 31, 2011  
    Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

Total revenues

  $ —       $ 87,405     $ 108,091     $ (39,317   $ 156,179  

Operating expenses

    —         50,402       96,291       (39,317     107,376  

Depreciation and amortization

    —         15,210       12,389       —         27,599  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating gross margin

    —         21,793       (589     —         21,204  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

General and administration expense (1)

    (45     (6,699     (62     —         (6,806

Gain on disposition of assets, net

    —         810       194       —         1,004  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating income (loss)

    (45     15,904       (457     —         15,402  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Other income and (expense):

                                       

Interest expense

    (6,852     (8,910     (1,728     11,629       (5,861

Interest income

    8,970       190       2,516       (11,629     47  

Other

    —         —         11       —         11  

Equity in net earnings of subsidiaries

    3,965       —         —         (3,965     —    
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other income and (expense)

    6,083       (8,720     799       (3,965     (5,803
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (benefit) before income taxes

    6,038       7,184       342       (3,965     9,599  
           

Income tax expense (benefit):

                                       

Current

    (65     222       3,861       —         4,018  

Deferred

    1,276       151       (606     —         821  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total income tax expense

    1,211       373       3,255       —         4,839  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

    4,827       6,811       (2,913     (3,965     4,760  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Less: Net loss attributable to noncontrolling interest

    —         —         (67     —         (67
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to controlling interest

  $ 4,827     $ 6,811     $ (2,846   $ (3,965   $ 4,827  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) All field operations general and administration expenses are included in operating expenses.

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)

 

                                         
    Year Ended March 31, 2012  
     Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

Cash flows from operating activities:

  $ 26,392     $ 21,173     $ 10,661     $ (31,900   $ 26,326  

Net income (loss)

                                       

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

                                       

Depreciation and amortization

    —         15,595       12,024       —         27,619  

Gain on disposition of assets

    —         (418     (74     —         (492

Deferred income tax expense

    4,618       2,550       (2,156     —         5,012  

Expenses not requiring cash

    6,839       191       (31     —         6,999  

Equity in net earnings of subsidiaries

    (31,900     —         —         31,900       —    

Change in accounts receivable

    (95     (2,326     (3,859     —         (6,280

Change in other assets

    (20,726     16,618       689       —         (3,419

Change in liabilities

    6,154       (24,103     (2,051     —         (20,000
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) operating activities

    (8,718     29,280       15,203       —         35,765  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash flows from investing activities:

                                       

Capital expenditures

    —         (56,611     (2,822     —         (59,433

Proceeds from the sale of assets

    —         697       39       —         736  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash (used in) investing activities

    —         (55,914     (2,783     —         (58,697
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash flows from financing activities:

                                       

Pay down on term note

    (6,000     —         —         —         (6,000

Excess tax benefit from stock-based compensation

    59       —         —         —         59  

Intercompany advances, net

    (6,150     23,370       (17,220     —         —    
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) financing activities

    (12,091     23,370       (17,220     —         (5,941
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net change in cash and cash equivalents

    (20,809     (3,264     (4,800     —         (28,873
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at beginning of year

    55,670       4,212       37,987       —         97,869  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at end of year

  $ 34,861     $ 948     $ 33,187     $ —       $ 68,996  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)

 

                                         
    Three months ended March 31, 2011  
    Parent     Guarantor     Non-Guarantor     Eliminations     Consolidated  

Cash flows from operating activities:

                                       

Net income (loss)

  $ 4,827     $ 6,811     $ (2,913   $ (3,965   $ 4,760  

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

                                       

Depreciation and amortization

    —         15,210       12,389       —         27,599  

Gain on disposition of assets

    —         (810     (194     —         (1,004

Deferred income tax expense

    1,276       151       (606     —         821  

Expenses not requiring cash

    4,507       —         (54     —         4,453  

Equity in net earnings of subsidiaries

    (3,965     —         —         3,965       —    

Change in accounts receivable

    6,968       24,315       (41,030     —         (9,747

Change in other assets

    326       39,374       (2,321     —         37,379  

Change in liabilities

    3,372       (66,599     39,723       —         (23,504
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by operating activities

    17,311       18,452       4,994       —         40,757  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
           

Cash flows from investing activities:

                                       

Capital expenditures

    —         (47,233     (3,431     —         (50,664

Proceeds from the sale of assets

    —         1,360       201       —         1,561  

Proceeds from insurance settlements

            250                       250  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash used in investing activities

    —         (45,623     (3,230     —         (48,853
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
           

Cash flows from financing activities:

                                       

Paydown on term note

    (3,000     —         —         —         (3,000

Proceeds from stock options exercised

    135       —         —         —         135  

Excess tax benefit from stock-based compensation

    1,125       —         —         —         1,125  

Intercompany advances, net

    (6,201     22,638       (16,437     —         —    
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) financing activities

    (7,941     22,638       (16,437     —         (1,740
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
           

Net change in cash and cash equivalents

    9,370       (4,533     (14,673     —         (9,836

Cash and cash equivalents at beginning of year

    13,835       2,317       35,279       —         51,431  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at end of period

  $ 23,205     $ (2,216   $ 20,606     $ —       $ 41,595  
   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

See accompanying notes to unaudited consolidated condensed financial statements.