Note 11 Supplemental Information

Accrued liabilities include the following:

	June 30,		December 31,
	2013		2012
	(In thousands)
Accrued compensation	$	150,867	$	158,095
Deferred revenue	183,383		148,165
Other taxes payable	66,304		58,590
Workers’ compensation liabilities	22,645		22,645
Interest payable	90,285		90,878
Warranty accrual	6,458		6,436
Litigation reserves	33,592		26,782
Current liability to discontinued operations	57,737		68,961
Professional fees	3,147		2,989
Current deferred tax liability	12,005		10,721
Other accrued liabilities	8,412		5,118
	$	634,835	$	599,380

Investment income (loss) includes the following:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013			2012
	(In thousands)

Interest and dividend income	$	2,342	$	3,594		$	3,118		$	4,949
Gains (losses) on investments, net	12,479		1,774		(1)	91,124		(2)	20,671		(1)(3)
	$	14,821	$	5,368		$	94,242		$	25,620

(1) Includes net unrealized gains of $1.4 million and $7.4 million from our trading securities during the three and six months ended June 30, 2012, respectively.

(2) Includes realized gains of $88.7 million from available-for-sale debt and equity securities and net realized gains of $2.4 million from our trading securities.

(3) Includes $12.5 million realized gain related to debt securities in addition to unrealized gains discussed above.

Losses (gains) on sales and disposals of long-lived assets and other expense (income), net includes the following:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(In thousands)

Losses (gains) on sales, disposals and involuntary conversions of long-lived assets	$	1,977		$	5,962		$	5,436		$	4,180
Provision for retirement of assets	—			46,264		(1)	—			46,264		(1)
Intangible asset impairment	—			74,960		(2)	—			74,960		(2)
Goodwill impairment	—			26,279		(3)	—			26,279		(3)
Termination of employment contract	—			—			45,000		(4)	—
Litigation expenses	(502		)	4,996			5,659			5,536
Foreign currency transaction losses (gains)	2,990			2,710			7,307			2,255
Losses (gains) on derivative instruments	—			(551		)	—			(1,013		)
Other losses (gains)	4,847			297			5,717			616
	$	9,312		$	160,917		$	69,119		$	159,077

(1) Represents a provision for retirement of long-lived assets totaling $46.3 million in multiple operating segments, which reduced the carrying value of some assets to their salvage value. The retirements in our Canada operations included functionally inoperable rigs and other drilling equipment. In our Production and Completion operations, the retirements related to rigs and vehicles that would require significant repair to return to work and other non-core assets when we consolidated our pressure pumping and well-servicing operations into one business line. A prolonged period of lower natural gas and oil prices and its potential impact on our utilization and dayrates could result in the recognition of future impairment charges to additional assets if future cash flow estimates, based upon information then available to management, indicate that the carrying value of those assets may not be recoverable.

(2) Represents impairment of the Superior trade name. The Superior trade name was initially classified as a ten-year intangible asset at the date of acquisition in September 2010. The impairment is a result of the decision to cease using the Superior trade name to reduce confusion in the marketplace and enhance the Nabors brand.

(3) Represents the impairment of goodwill associated with our U.S. Offshore and International reporting units. The impairments were deemed necessary due to the prolonged uncertainty of utilization of some of our rigs as a result of changes in our customers’ plans for future drilling operations in the Gulf of Mexico as well as our international markets. A significantly prolonged period of lower natural gas prices or changes in laws and regulations could continue to adversely affect the demand for and prices of our services, which could result in future goodwill impairment charges for other reporting units due to the potential impact on our estimate of our future operating results.

(4) Represents a one-time stock grant valued at $27 million, which vested immediately and $18 million in cash awarded and paid to Mr. Petrello in connection with the termination of his prior employment agreement. See Note 9 — Commitments and Contingencies for additional discussion.

The changes in accumulated other comprehensive income (loss), by component, include the following:

	Gains (losses) on cash flow hedges			Unrealized gains (losses) on available-for- sale securities			Defined benefit pension plan items			Foreign currency items			Total
	(In thousands (a))
As of January 1, 2012	$	(3,254	)	$	45,179		$	(7,378	)	$	286,717		$	321,264
Other comprehensive income (loss) before reclassifications	—			7,215			—			(2,393		)	4,822
Amounts reclassified from accumulated other comprehensive income (loss)	263			(8,579		)	318			—			(7,998		)
Net other comprehensive income (loss)	263			(1,364		)	318			(2,393		)	(3,176		)
As of June 30, 2012	$	(2,991	)	$	43,815		$	(7,060	)	$	284,324		$	318,088

As of January 1, 2013	$	(2,793	)	$	134,229		$	(7,632	)	$	307,791		$	431,595
Other comprehensive income (loss) before reclassifications	—			4,913			—			(52,569		)	(47,656		)
Amounts reclassified from accumulated other comprehensive income (loss)	187			(85,454		)	344			—			(84,923		)
Net other comprehensive income (loss)	187			(80,541		)	344			(52,569		)	(132,579		)
As of June 30, 2013	$	(2,606	)	$	53,688		$	(7,288	)	$	255,222		$	299,016

(a) All amounts are net of tax. Amounts in parentheses indicate debits.

The line items that were reclassified from net income include the following:

	Three Months Ended June 30,					Six Months Ended June 30,
Line item in consolidated statement of income (loss)	2013		2012			2013		2012
	(In thousands)

Investment income (loss)	$	12,183	$	19		$	88,157	$	12,484
Interest expense	153		191			306		382
General and administrative expenses	281		260			562		520
Total before tax	$	11,749	$	(432	)	$	87,289	$	11,582
Tax expense (benefit)	2,082		(165		)	2,366		3,584
Reclassification adjustment for (gains)/losses included in net income (loss)	$	9,667	$	(267	)	$	84,923	$	7,998

In January 2013, we purchased the business of NES for a total cash price of approximately $37.5 million. This business expands our technology and development capability for drilling and measurement tools and services, and is included in our Rig Services operating segment. The purchase price was allocated to the net tangible and intangible assets acquired based on their preliminary fair value estimates as of January 18, 2013. The excess of the purchase price over the fair values of the assets acquired was recorded as goodwill in the amount of $15.8 million.