Annual report pursuant to Section 13 and 15(d)

Reportable Segments

v2.4.0.6
Reportable Segments
 12 Months Ended
Dec. 31, 2012
Reportable Segments

Note 12 — Reportable Segments

We report our business activities in six business segments: (1) Rental tools, (2) U.S. barge drilling, (3) U.S. drilling, (4) International drilling, (5) Technical services, and (6) Construction contract. We eliminate inter-segment revenue and expenses. The following table represents the results of operations by reportable segment:

 

     Year Ended December 31,  

Operations by Reportable Industry Segment:

    2012     2011     2010  
     (Dollars in Thousands)  

Revenues:

       

Rental Tools(1)

    $ 246,900      $ 237,068      $ 172,598   

U.S. Barge Drilling(1)

      123,672        93,763        64,543   

U.S. Drilling(1)(3)

      1,387        —        —   

International Drilling(1)

      291,772        318,482        294,821   

Technical Services(1)

      14,251        27,695        36,423   

Construction Contract(1)

      —        9,638        91,090   
  

 

 

    

 

 

    

 

 

  

Total revenues

      677,982        686,646        659,475   
  

 

 

    

 

 

    

 

 

  

Operating income:

       

Rental Tools(2)

      113,899        120,822        74,541   

U.S. Barge Drilling(2)

      39,774        11,116        (11,503 ) 

U.S. Drilling(2)

      (15,168 )      (3,915 )      (217 ) 

International Drilling(2)

      12,642        22,237        5,092   

Technical Services(2)

      (246 )      5,335        5,052   

Construction Contract(2)

      —        771        202   
  

 

 

    

 

 

    

 

 

  

Total operating gross margin

      150,901        156,366        73,167   

General and administrative expense

      (46,052 )      (31,314 )      (30,728 ) 

Impairments and other charges

      —        (170,000 )      —   

Provision for reduction in carrying value of certain assets

      —        (1,350 )      (1,952 ) 

Gain on disposition of assets, net

      1,974        3,659        4,620   
  

 

 

    

 

 

    

 

 

  

Total operating income (loss)

      106,823        (42,639 )      45,107   

Interest expense

      (33,542 )      (22,594 )      (26,805 ) 

Changes in fair value of derivative positions

      55        (110 )      —   

Loss on extinguishment of debt

      (2,130 )      —        (7,209 ) 

Other

      (229 )      (69 )      412   
  

 

 

    

 

 

    

 

 

  

Income (loss) from continuing operations before income taxes

    $ 70,977      $ (65,412 )    $ 11,505   
  

 

 

    

 

 

    

 

 

  
      2012     2011        

Identifiable assets:

       

Rental Tools

    $ 194,600      $ 188,520     

U.S. Barge Drilling

      99,409        108,396     

U.S. Drilling

      374,794        265,166     

International Drilling

      414,546        426,490     
  

 

 

    

 

 

    

Total identifiable assets

      1,083,349        988,572     

Corporate and other assets(4)

      172,384        227,674     
  

 

 

    

 

 

    

Total assets

    $ 1,255,733      $ 1,216,246     
  

 

 

    

 

 

    

 

1) In 2012, our two largest customers, Exxon Neftegas Limited (ENL) and Schlumberger, constituted approximately 12 percent and 10 percent, respectively, of our total consolidated revenues and approximately 27 percent and 24 percent of our International Drilling segment, respectively. In 2011, our largest customer, ENL constituted approximately 16 percent of our total revenues and approximately 34 percent of our International Drilling segment. In 2010, our two largest customers BP and ExxonMobil both accounted for approximately 12 percent of the Company’s total revenues. In 2010, BP accounted for 90 percent of our construction contract segment revenues and ExxonMobil accounted for approximately 22 percent of our International Drilling segment and 7 percent of our Rental Tools segment.

 

2) Operating income is calculated as revenues less direct operating expenses, including depreciation and amortization expense.

 

3) As of December 31, 2011, this segment had not begun generating revenue.

 

4) This category includes corporate assets as well as minimal assets for our Technical Services segment primarily related to office furniture and fixtures.

 

     Year ended December 31,  

Operations by Reportable Industry Segment:

    2012      2011      2010  
     (Dollars in Thousands)  

Capital expenditures:

         

Rental Tools

    $ 61,958       $ 61,702       $ 48,872   

U.S. Barge Drilling

      8,808         7,339         5,315   

U.S. Drilling

      86,786         99,915         113,177   

International Drilling

      15,240         15,011         50,482   

Corporate

      18,751         6,432         1,338   
  

 

 

     

 

 

     

 

 

  

Total capital expenditures

    $ 191,543       $ 190,399       $ 219,184   
  

 

 

     

 

 

     

 

 

  

Depreciation and amortization:

         

Rental Tools

      42,944         40,497         36,558   

U.S. Barge Drilling

      13,906         17,006         22,165   

U.S. Drilling

      7,011         2,223         —   

International Drilling

      45,967         48,965         52,429   

Corporate and other (1)

      3,189         3,445         3,878   
  

 

 

     

 

 

     

 

 

  

Total depreciation and amortization

    $ 113,017       $ 112,136       $ 115,030   
  

 

 

     

 

 

     

 

 

  

 

1) This category includes depreciation of corporate assets as well as minimal depreciation for our Technical Services segment primarily related to office furniture and fixtures.

 

     Year Ended December 31,  

Operations by Geographic Area:

    2012     2011     2010  
     (Dollars in Thousands)  

Revenues:

       

Africa and Middle East

    $ 26,528      $ 6,774      $ 22,621   

Asia Pacific

      39,400        38,477        26,416   

CIS

      122,304        176,421        149,963   

Latin America

      103,540        96,810        103,885   

United States

      386,210        368,164        356,590   
  

 

 

    

 

 

    

 

 

  

Total revenues

      677,982        686,646        659,475   
  

 

 

    

 

 

    

 

 

  

Operating gross margin:

       

Africa and Middle East(1)

      (2,234 )      (6,383 )      659   

Asia Pacific(1)

      (927 )      1,933        2,374   

CIS(1)

      6,840        26,402        8,139   

Latin America(1)

      8,990        377        1,210   

United States(1)

      138,232        134,037        60,785   
  

 

 

    

 

 

    

 

 

  

Total operating gross margin

      150,901        156,366        73,167   
  

 

 

    

 

 

    

 

 

  

General and administrative expense

      (46,052 )      (31,314 )      (30,728 ) 

Impairments and other charges

      —        (170,000 )      —   

Provision for reduction in carrying value of certain assets

      —        (1,350 )      (1,952 ) 

Gain on disposition of assets, net

      1,974        3,659        4,620   
  

 

 

    

 

 

    

 

 

  

Total operating income (loss)

      106,823        (42,639 )      45,107   

Interest expense

      (33,542 )      (22,594 )      (26,805 ) 

Changes in fair value of derivative positions

      55        (110 )      —   

Loss on extinguishment of debt

      (2,130 )      —        (7,209 ) 

Other

      (229 )      (69 )      412   
  

 

 

    

 

 

    

 

 

  

Income (loss) from continuing operations before income taxes

    $ 70,977      $ (65,412 )    $ 11,505   
  

 

 

    

 

 

    

 

 

  

Long-lived assets:(2)

       

Africa and Middle East

    $ 25,032      $ 28,427     

Asia Pacific

      15,723        18,300     

CIS

      106,774        119,282     

Latin America

      63,899        57,710     

United States

      574,730        496,090     
  

 

 

    

 

 

    

Total long-lived assets

    $ 786,158      $ 719,809     
  

 

 

    

 

 

    

 

 

1) Operating income is calculated as revenues less direct operating expenses, including depreciation and amortization expense.

 

2) Long-lived assets primarily consist of property, plant and equipment, net and exclude assets held for sale, if any.