Parker Wellbore Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements (Tables)

Parent, Guarantor, Non-Guarantor Unaudited Consolidating Condensed Financial Statements (Tables)

9 Months Ended

Sep. 30, 2012

Balance Sheets

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED BALANCE SHEET

(Dollars in Thousands)

(Unaudited)


	September 30, 2012
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	77,468		$	7,907		$	28,752		$	—		$	114,127
Accounts and notes receivable, net		289,803			97,085			287,958			(514,397	)		160,449
Rig materials and supplies		—			(796	)		23,730			—			22,934
Deferred costs		—			—			1,209			—			1,209
Deferred income taxes		—			5,540			1,075			—			6,615
Other tax assets		81,077			(55,655	)		3,594			—			29,016
Assets held for sale		—			—			11,656			—			11,656
Other current assets		525			4,091			7,583			—			12,199

Total current assets		448,873			58,172			365,557			(514,397	)		358,205

Property, plant and equipment, net		60			531,448			241,736			—			773,244
Investment in subsidiaries and intercompany advances		733,876			(199,435	)		1,382,500			(1,916,941	)		—
Other noncurrent assets		41,336			68,415			15,689			—			125,440

Total assets	$	1,224,145		$	458,600		$	2,005,482		$	(2,431,338	)	$	1,256,889

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	43,000		$	—		$	—		$	—		$	43,000
Accounts payable and accrued liabilities		74,494			75,832			208,112			(228,726	)		129,712
Accrued income taxes		(1,014	)		2,227			4,029			—			5,242

Total current liabilities		116,480			78,059			212,141			(228,726	)		177,954

Long-term debt		429,462			—			—			—			429,462
Other long-term liabilities		3,933			6,287			15,050			—			25,270
Long-term deferred tax liability		2,359			29,945			(16,726	)		—			15,578
Intercompany payables		62,583			43,657			103,625			(209,865	)		—
Contingencies		—			—			—			—			—

Stockholders' equity:
Common stock		19,753			18,049			43,003			(61,052	)		19,753
Capital in excess of par value		644,108			733,111			1,452,440			(2,185,552	)		644,107
Retained earnings (accumulated deficit)		(54,533	)		(450,508	)		196,651			253,857			(54,533	)

Total controlling interest stockholders' equity		609,328			300,652			1,692,094			(1,992,747	)		609,327

Noncontrolling interest		—			—			(702	)		—			(702	)

Total Equity		609,328			300,652			1,691,392			(1,992,747	)		608,625

Total liabilities and stockholders' equity	$	1,224,145		$	458,600		$	2,005,482		$	(2,431,338	)	$	1,256,889

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

Statement of Operations

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS

(Dollars in Thousands)

(Unaudited)


	Three months ended September 30, 2012
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Total revenues	$	—		$	98,969		$	94,749		$	(28,417	)	$	165,301
Operating expenses		—			45,850			84,051			(28,417	)		101,484
Depreciation and amortization		—			17,866			11,913			—			29,779

Total operating gross margin		—			35,253			(1,215	)		—			34,038

General and administration expense ⁽¹⁾		(47	)		(8,823	)		(35	)		—			(8,905	)
Gain on disposition of assets, net		—			553			53			—			606

Total operating income (loss)		(47	)		26,983			(1,197	)		—			25,739

Other income and (expense):
Interest expense		(9,105	)		(43	)		(1,840	)		2,817			(8,171	)
Changes in fair value of derivative positions		19			—			—			—			19
Interest income		95			179			2,573			(2,817	)		30
Loss on extinguishment of debt		(117	)		—			—			—			(117	)
Other		—			26			—			—			26
Equity in net earnings of subsidiaries		10,596			—			—			(10,596	)		—

Total other income (expense)		1,488			162			733			(10,596	)		(8,213	)

Income (benefit) before income taxes		1,441			27,145			(464	)		(10,596	)		17,526
Income tax expense (benefit)		(9,495	)		10,451			5,739			—			6,695

Net income (loss)		10,936			16,694			(6,203	)		(10,596	)		10,831

Less: Net (loss) attributable to noncontrolling interest		—			—			(105	)		—			(105	)

Net income (loss) attributable to controlling interest	$	10,936		$	16,694		$	(6,098	)	$	(10,596	)	$	10,936

(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 September 30, 2011
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Total revenues	$	—		$	98,687		$	105,807		$	(27,905	)	$	176,589
Operating expenses		—			41,823			85,124			(27,905	)		99,042
Depreciation and amortization		—			16,124			11,457			—			27,581

Total operating gross margin		—			40,740			9,226			—			49,966

General and administration expense ⁽¹⁾		(45	)		(8,454	)		(131	)		—			(8,630	)
Gain on disposition of assets, net		—			233			390			—			623

Total operating income (loss)		(45	)		32,519			9,485			—			41,959

Other income and (expense):
Interest expense		(6,709	)		(35	)		(3,051	)		4,204			(5,591	)
Interest income		124			188			3,921			(4,204	)		29
Gain (Loss) on fair value of derivative contracts		(49	)		—			—			—			(49	)
Other		—			(657	)		—			—			(657	)
Equity in net earnings of subsidiaries		25,361			—			—			(25,361	)		—

Total other income and (expense)		18,727			(504	)		870			(25,361	)		(6,268	)

Income (benefit) before income taxes		18,682			32,015			10,355			(25,361	)		35,691

Total income tax expense (benefit)		(2,043	)		12,490			4,595			—			15,042

Net income (loss)		20,725			19,525			5,760			(25,361	)		20,649

Less: Net income (loss) attributable to noncontrolling interest		—			—			(76	)		—			(76	)

Net (loss) attributable to controlling interest	$	20,725		$	19,525		$	5,836		$	(25,361	)	$	20,725

(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)


	Nine months ended September 30, 2012
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Total revenues	$	—		$	302,892		$	295,811		$	(77,908	)	$	520,795
Operating expenses		—			136,849			242,001			(77,908	)		300,942
Depreciation and amortization		—			49,127			36,230			—			85,357

Total operating gross margin		—			116,916			17,580			—			134,496

General and administration expense ⁽¹⁾		(137	)		(21,273	)		(412	)		—			(21,822	)
Gain on disposition of assets, net		—			1,168			1,298			—			2,466

Total operating income (loss)		(137	)		96,811			18,466			—			115,140

Other income and (expense):
Interest expense		(27,923	)		(115	)		(5,811	)		8,716			(25,133	)
Changes in fair value of derivative positions		8			—			—			—			8
Interest income		8,695			4,894			39,345			(52,825	)		109
Loss on extinguishment of debt		(1,766	)		—			—			—			(1,766	)
Other		—			64			(2	)		—			62
Equity in net earnings of subsidiaries		61,553			—			—			(61,553	)		—

Total other income (expense)		40,567			4,843			33,532			(105,662	)		(26,720	)

Income (benefit) before income taxes		40,430			101,654			51,998			(105,662	)		88,420
Income tax expense (benefit)		(16,981	)		38,149			9,987			—			31,155

Net income (loss)		57,411			63,505			42,011			(105,662	)		57,265

Less: Net (loss) attributable to noncontrolling interest		—			—			(146	)		—			(146	)

Net income (loss) attributable to controlling interest	$	57,411		$	63,505		$	42,157		$	(105,662	)	$	57,411

(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)


	Nine months ended September 30, 2011
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Total revenues	$	—		$	281,527		$	314,221		$	(90,168	)	$	505,580
Operating expenses		—			133,451			267,817			(90,168	)		311,100
Depreciation and amortization		—			46,721			35,790			—			82,511

Total operating gross margin		—			101,355			10,614			—			111,969

General and administration expense ⁽¹⁾		(173	)		(22,949	)		(262	)		—			(23,384	)
Gain on disposition of assets, net		—			1,137			856			—			1,993

Total operating income (loss)		(173	)		79,543			11,208			—			90,578

Other income and (expense):
Interest expense		(20,307	)		(17,854	)		(6,939	)		27,892			(17,208	)
Interest income		18,065			568			9,467			(27,892	)		208
Gain (Loss) on fair value of derivative contracts		(186	)		—			—			—			(186	)
Other		—			(536	)		14			—			(522	)
Equity in net earnings of subsidiaries		66,120			—			—			(66,120	)		—

Total other income and (expense)		63,692			(17,822	)		2,542			(66,120	)		(17,708	)

Income (benefit) before income taxes		63,519			61,721			13,750			(66,120	)		72,870
Total income tax expense (benefit)		23,792			20,543			(10,990	)		—			33,345

Net income (loss)		39,727			41,178			24,740			(66,120	)		39,525

Less: Net income (loss) attributable to noncontrolling interest		—			—			(202	)		—			(202	)

Net (loss) attributable to controlling interest	$	39,727		$	41,178		$	24,942		$	(66,120	)	$	39,727

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

Statement of Cash Flows

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)


	Year Ended September 30, 2012
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	57,411		$	63,505		$	42,011		$	(105,662	)	$	57,265
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		—			49,127			36,230			—			85,357
Loss on extinguishment of debt		1,766			—			—			—			1,766
Gain on disposition of assets		—			(1,168	)		(1,298	)		—			(2,466	)
Deferred income tax expense		5,940			4,868			(2,405	)		—			8,403
Expenses not requiring cash		13,264			689			1,770			1			15,724
Equity in net earnings of subsidiaries		(61,553	)		—			—			61,553			—
Change in accounts receivable		(291	)		766			24,173			—			24,648
Change in other assets		(32,874	)		61,320			(27,882	)		—			564
Change in accrued income taxes		(5,068	)		1,832			187			—			(3,049	)
Change in liabilities		12,917			(21,430	)		(1,672	)		—			(10,185	)

Net cash provided by (used in) operating activities		(8,488	)		159,509			71,114			(44,108	)		178,027

Cash flows from investing activities:
Capital expenditures		—			(139,618	)		(8,040	)		—			(147,658	)
Proceeds from the sale of assets		—			1,667			1,829			—			3,496
Proceeds from insurance settlements		—			—			—			—			—
Intercompany dividend payment		(8,387	)		(4,357	)		(31,364	)		44,108			—

Net cash (used in) investing activities		(8,387	)		(142,308	)		(37,575	)		44,108			(144,162	)

Cash flows from financing activities:
Proceeds from debt issuance		130,000			—			—			—			130,000
Proceeds from draw on revolver credit facility		—			—			—			—			—
Paydown on senior notes		(125,000	)		—			—			—			(125,000	)
Paydown on term note		(18,000	)		—			—			—			(18,000	)
Paydown on revolver credit facility		—			—			—			—			—
Payment of debt issuance costs		(3,516	)		—			—			—			(3,516	)
Payment of debt extinguishment costs		(519	)		—			—			—			(519	)
Proceeds from stock options exercised		—			—			—			—			—
Excess tax benefit from stock-based compensation		(572	)		—			—			—			(572	)
Intercompany advances, net		56,280			(13,507	)		(42,773	)		—			—

Net cash provided by (used in) financing activities		38,673			(13,507	)		(42,773	)		—			(17,607	)

Net change in cash and cash equivalents		21,798			3,694			(9,234	)		—			16,258
Cash and cash equivalents at beginning of year		55,670			4,212			37,987			—			97,869

Cash and cash equivalents at end of year	$	77,468		$	7,907		$	28,752		$	—		$	114,127

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)


	Nine Months Ended September 30, 2011
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	39,727		$	41,178		$	24,740		$	(66,120	)	$	39,525
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		—			46,721			35,790			—			82,511
Gain on disposition of assets		—			(1,137	)		(856	)		—			(1,993	)
Deferred income tax expense		45,765			(65	)		(25,964	)		—			19,736
Expenses not requiring cash		12,666			—			(1,592	)		—			11,074
Equity in net earnings of subsidiaries		(66,120	)		—			—			66,120			—
Change in accounts receivable		(2,591	)		65,716			(67,601	)		—			(4,476	)
Change in other assets		53,150			2,071			(6,352	)		—			48,869
Change in liabilities		(4,887	)		(79,082	)		67,438			—			(16,531	)

Net cash provided by (used in) operating activities		77,710			75,402			25,603			—			178,715

Cash flows from investing activities:
Capital expenditures		—			(132,287	)		(9,554	)		—			(141,841	)
Proceeds from the sale of assets		—			3,073			352			—			3,425
Proceeds from insurance settlements		—			250			—			—			250
Intercompany dividend payment		—			—			—			—			—

Net cash used in investing activities		—			(128,964	)		(9,202	)		—			(138,166	)

Cash flows from financing activities:
Proceeds from issuance of debt		50,000			—			—			—			50,000
Repayments of term loan		(15,000	)		—			—			—			(15,000	)
Repayments on revolver		(25,000	)		—			—			—			(25,000	)
Payment of debt issuance costs		(504	)		—			—			—			(504	)
Proceeds from stock options exercised		183			—			—			—			183
Excess tax benefit from stock-based compensation		1,424			—			—			—			1,424
Intercompany advances, net		(41,920	)		68,844			(26,924	)		—			—

Net cash provided by (used in) financing activities		(30,817	)		68,844			(26,924	)		—			11,103

Net change in cash and cash equivalents		46,893			15,282			(10,523	)		—			51,652
Cash and cash equivalents at beginning of period		13,835			2,317			35,279			—			51,431

Cash and cash equivalents at end of period	$	60,728		$	17,599		$	24,756		$	—		$	103,083

See accompanying notes to unaudited consolidated condensed financial statements.