Note 13 Condensed Consolidating Financial Information

Nabors has fully and unconditionally guaranteed all of the issued public debt securities of Nabors Delaware, a 100% wholly owned subsidiary. The following condensed consolidating financial information is included so that separate financial statements of Nabors Delaware are not required to be filed with the SEC. The condensed consolidating financial statements present investments in both consolidated and unconsolidated affiliates using the equity method of accounting.

The following condensed consolidating financial information presents condensed consolidating balance sheets as of March 31, 2019 and December 31, 2018, statements of income (loss) and statements of other comprehensive income (loss) for the three months ended March 31, 2019 and 2018, and statements of cash flows for the three months ended March 31, 2019 and 2018 of (a) Nabors, parent/guarantor, (b) Nabors Delaware, issuer of public debt securities guaranteed by Nabors, (c) the non-guarantor subsidiaries, (d) consolidating adjustments necessary to consolidate Nabors and its subsidiaries and (e) Nabors on a consolidated basis.

Condensed Consolidating Balance Sheets


	March 31, 2019
					Other
	Nabors			Nabors	Subsidiaries
	(Parent/		Delaware		(Non-		Consolidating
	Guarantor)		(Issuer)		Guarantors)		Adjustments		Total
	(In thousands)
	ASSETS
Current assets:
Cash and cash equivalents	$	334	$	41	$	428,752	$	—	$	429,127
Short-term investments		—		—		40,590		—		40,590
Accounts receivable, net		—		—		743,528		—		743,528
Inventory, net		—		—		166,139		—		166,139
Assets held for sale		—		—		12,330		—		12,330
Other current assets		417		433		163,339		—		164,189
Total current assets		751		474		1,554,678		—		1,555,903
Property, plant and equipment, net		—		—		5,399,514		—		5,399,514
Goodwill		—		—		184,104		—		184,104
Intercompany receivables		100,764		219,756		2,611		(323,131)		—
Investment in consolidated affiliates		2,492,908		5,568,841		4,118,531		(12,180,280)		—
Deferred income taxes		—		399,679		344,531		(399,679)		344,531
Other long-term assets		—		110		303,847		(14,325)		289,632
Total assets	$	2,594,423	$	6,188,860	$	11,907,816	$	(12,917,415)	$	7,773,684

	LIABILITIES AND EQUITY
Current liabilities:
Current portion of debt	$	—	$	—	$	850	$	—	$	850
Trade accounts payable		118		41		399,643		—		399,802
Accrued liabilities		7,970		18,985		271,104		—		298,059
Income taxes payable		—		—		26,100		—		26,100
Current lease liabilities		—		—		10,991		—		10,991
Total current liabilities		8,088		19,026		708,688		—		735,802
Long-term debt		—		3,691,905		—		(14,325)		3,677,580
Other long-term liabilities		—		29,331		251,260		—		280,591
Deferred income taxes		—		—		419,428		(399,679)		19,749
Intercompany payable		—		—		323,131		(323,131)		—
Total liabilities		8,088		3,740,262		1,702,507		(737,135)		4,713,722
Redeemable noncontrolling interest in subsidiary		—		—		409,923		—		409,923
Shareholders’ equity		2,586,335		2,448,598		9,731,682		(12,180,280)		2,586,335
Noncontrolling interest		—		—		63,704		—		63,704
Total equity		2,586,335		2,448,598		9,795,386		(12,180,280)		2,650,039
Total liabilities and equity	$	2,594,423	$	6,188,860	$	11,907,816	$	(12,917,415)	$	7,773,684

Condensed Consolidating Balance Sheets


	December 31, 2018
					Other
	Nabors		Nabors		Subsidiaries
	(Parent/		Delaware		(Non-		Consolidating
	Guarantor)		(Issuer)		Guarantors)		Adjustments		Total
	(In thousands)
	ASSETS
Current assets:
Cash and cash equivalents	$	474	$	42	$	447,250	$	—	$	447,766
Short-term investments		—		—		34,036		—		34,036
Accounts receivable, net		—		—		756,320		—		756,320
Inventory, net		—		—		165,587		—		165,587
Assets held for sale		—		—		12,250		—		12,250
Other current assets		50		433		177,121		—		177,604
Total current assets		524		475		1,592,564		—		1,593,563
Property, plant and equipment, net		—		—		5,467,870		—		5,467,870
Goodwill		—		—		183,914		—		183,914
Intercompany receivables		95,946		218,129		2,611		(316,686)		—
Investment in consolidated affiliates		2,658,827		5,494,886		4,079,269		(12,232,982)		—
Deferred income taxes		—		388,089		345,091		(388,089)		345,091
Other long-term assets		—		142		277,689		(14,325)		263,506
Total assets	$	2,755,297	$	6,101,721	$	11,949,008	$	(12,952,082)	$	7,853,944

	LIABILITIES AND EQUITY
Current liabilities:
Current portion of debt	$	—	$	—	$	561	$	—	$	561
Trade accounts payable		132		14		392,697		—		392,843
Accrued liabilities		28,815		62,830		326,267		—		417,912
Income taxes payable		—		—		20,761		—		20,761
Total current liabilities		28,947		62,844		740,286		—		832,077
Long-term debt		—		3,600,209		—		(14,325)		3,585,884
Other long-term liabilities		—		29,331		245,154		—		274,485
Deferred income taxes		—		—		394,400		(388,089)		6,311
Intercompany payable		25,500		—		291,186		(316,686)		—
Total liabilities		54,447		3,692,384		1,671,026		(719,100)		4,698,757
Redeemable noncontrolling interest in subsidiary		—		—		404,861		—		404,861
Shareholders’ equity		2,700,850		2,409,337		9,823,645		(12,232,982)		2,700,850
Noncontrolling interest		—		—		49,476		—		49,476
Total equity		2,700,850		2,409,337		9,873,121		(12,232,982)		2,750,326
Total liabilities and equity	$	2,755,297	$	6,101,721	$	11,949,008	$	(12,952,082)	$	7,853,944

Condensed Consolidating Statements of Income (Loss)


	Three Months Ended March 31, 2019
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Revenues and other income:
Operating revenues	$	—	$	—	$	799,640	$	—	$	799,640
Earnings (losses) from unconsolidated affiliates		—		—		(5)		—		(5)
Earnings (losses) from consolidated affiliates		(115,046)		73,918		35,117		6,011		—
Investment income (loss)		—		—		10,205		(528)		9,677
Total revenues and other income		(115,046)		73,918		844,957		5,483		809,312
Costs and other deductions:
Direct costs		—		—		520,957		—		520,957
General and administrative expenses		2,414		277		65,650		(174)		68,167
Research and engineering		—		—		13,520		—		13,520
Depreciation and amortization		—		31		210,360		—		210,391
Interest expense, net		—		52,750		(398)		—		52,352
Other, net		237		(2,667)		19,758		174		17,502
Intercompany interest expense, net		12		—		(12)		—		—
Total costs and other deductions		2,663		50,391		829,835		—		882,889
Income (loss) from continuing operations before income taxes		(117,709)		23,527		15,122		5,483		(73,577)
Income tax expense (benefit)		—		(11,590)		41,389		—		29,799
Income (loss) from continuing operations, net of tax		(117,709)		35,117		(26,267)		5,483		(103,376)
Income (loss) from discontinued operations, net of tax		—		—		(157)		—		(157)
Net income (loss)		(117,709)		35,117		(26,424)		5,483		(103,533)
Less: Net (income) loss attributable to noncontrolling interest		—		—		(14,176)		—		(14,176)
Net income (loss) attributable to Nabors		(117,709)		35,117		(40,600)		5,483		(117,709)
Less: Preferred stock dividend		(4,313)		—		—		—		(4,313)
Net income (loss) attributable to Nabors common shareholders	$	(122,022)	$	35,117	$	(40,600)	$	5,483	$	(122,022)

Condensed Consolidating Statements of Income (Loss)


	Three Months Ended March 31, 2018
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Revenues and other income:
Operating revenues	$	—	$	—	$	734,194	$	—	$	734,194
Earnings (losses) from unconsolidated affiliates		—		—		2		—		2
Earnings (losses) from consolidated affiliates		(141,825)		23,985		(26,525)		144,365		—
Investment income (loss)		2		—		3,444		(2,981)		465
Total revenues and other income		(141,823)		23,985		711,115		141,384		734,661
Costs and other deductions:
Direct costs		—		—		475,403		—		475,403
General and administrative expenses		2,383		242		72,115		(169)		74,571
Research and engineering		—		—		15,806		—		15,806
Depreciation and amortization		—		30		213,418		—		213,448
Interest expense, net		—		65,325		(3,939)		—		61,386
Other, net		(5)		—		13,925		169		14,089
Total costs and other deductions		2,378		65,597		786,728		—		854,703
Income (loss) from continuing operations before income taxes		(144,201)		(41,612)		(75,613)		141,384		(120,042)
Income tax expense (benefit)		—		(15,087)		38,632		—		23,545
Income (loss) from continuing operations, net of tax		(144,201)		(26,525)		(114,245)		141,384		(143,587)
Income (loss) from discontinued operations, net of tax		—		—		(75)		—		(75)
Net income (loss)		(144,201)		(26,525)		(114,320)		141,384		(143,662)
Less: Net (income) loss attributable to noncontrolling interest		—		—		(539)		—		(539)
Net income (loss) attributable to Nabors	$	(144,201)	$	(26,525)	$	(114,859)	$	141,384	$	(144,201)
Less: Preferred stock dividend		—		—		—		—		—
Net income (loss) attributable to Nabors common shareholders	$	(144,201)	$	(26,525)	$	(114,859)	$	141,384	$	(144,201)

Condensed Consolidating Statements of Comprehensive Income (Loss)


	Three Months Ended March 31, 2019
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Net income (loss) attributable to Nabors	$	(117,709)	$	35,117	$	(40,600)	$	5,483	$	(117,709)
Other comprehensive income (loss) before tax
Translation adjustment attributable to Nabors		9,190		(4)		9,190		(9,186)		9,190
Pension liability amortization and adjustment		54		54		108		(162)		54
Unrealized gains (losses) and amortization on cash flow hedges		140		140		140		(280)		140
Other comprehensive income (loss) before tax		9,384		190		9,438		(9,628)		9,384
Income tax expense (benefit) related to items of other comprehensive income (loss)		46		46		92		(138)		46
Other comprehensive income (loss), net of tax		9,338		144		9,346		(9,490)		9,338
Comprehensive income (loss) attributable to Nabors		(108,371)		35,261		(31,254)		(4,007)		(108,371)
Net income (loss) attributable to noncontrolling interest		—		—		14,176		—		14,176
Translation adjustment attributable to noncontrolling interest		—		—		52		—		52
Comprehensive income (loss) attributable to noncontrolling interest		—		—		14,228		—		14,228
Comprehensive income (loss)	$	(108,371)	$	35,261	$	(17,026)	$	(4,007)	$	(94,143)

Condensed Consolidating Statements of Comprehensive Income (Loss)


	Three Months Ended March 31, 2018
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Net income (loss) attributable to Nabors	$	(144,201)	$	(26,525)	$	(114,859)	$	141,384	$	(144,201)
Other comprehensive income (loss) before tax
Translation adjustment attributable to Nabors		(9,343)		—		(9,343)		9,343		(9,343)
Pension liability amortization and adjustment		54		54		108		(162)		54
Adoption of ASU No. 2016-01		(9,144)		—		(9,144)		9,144		(9,144)
Unrealized gains (losses) and amortization on cash flow hedges		140		140		140		(280)		140
Other comprehensive income (loss) before tax		(18,293)		194		(18,239)		18,045		(18,293)
Income tax expense (benefit) related to items of other comprehensive income (loss)		43		43		86		(129)		43
Other comprehensive income (loss), net of tax		(18,336)		151		(18,325)		18,174		(18,336)
Comprehensive income (loss) attributable to Nabors		(162,537)		(26,374)		(133,184)		159,558		(162,537)
Net income (loss) attributable to noncontrolling interest		—		—		539		—		539
Translation adjustment attributable to noncontrolling interest		—		—		(96)		—		(96)
Comprehensive income (loss) attributable to noncontrolling interest		—		—		443		—		443
Comprehensive income (loss)	$	(162,537)	$	(26,374)	$	(132,741)	$	159,558	$	(162,094)

Condensed Consolidating Statements Cash Flows


	Three Months Ended March 31, 2019
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Net cash provided by (used for) operating activities	$	55,162	$	(88,799)	$	161,959	$	(58,468)	$	69,854
Cash flows from investing activities:
Purchases of investments		—		—		(4,221)		—		(4,221)
Sales and maturities of investments		—		—		1,134		—		1,134
Cash paid for acquisitions of businesses, net of cash acquired		—		—		(2,929)		—		(2,929)
Cash paid for investments in consolidated affiliates		—		—		(4,000)		4,000		—
Capital expenditures		—		—		(141,070)		—		(141,070)
Proceeds from sales of assets and insurance claims		—		—		2,642		—		2,642
Change in intercompany balances		—		(1,627)		1,627		—		—
Net cash provided by (used for) investing activities		—		(1,627)		(146,817)		4,000		(144,444)
Cash flows from financing activities:
Debt issuance costs		—		(35)		—		—		(35)
Proceeds from revolving credit facilities		—		180,000		—		—		180,000
Proceeds from parent contributions		—		4,000		—		(4,000)		—
Proceeds from issuance of common shares, net of issuance costs		6		—		(6)		—		—
Reduction of long-term debt		—		(43,540)		—		—		(43,540)
Reduction in revolving credit facilities		—		(50,000)		—		—		(50,000)
Dividends to common and preferred shareholders		(28,557)		—		(376)		3,168		(25,765)
Proceeds from (payments for) short-term borrowings		—		—		289		—		289
Proceeds from issuance of intercompany debt		25,000		—		(25,000)		—		—
Paydown of intercompany debt		(50,500)		—		50,500		—		—
Distribution from subsidiary to parent		—		—		(55,300)		55,300		—
Other changes		(1,251)		—		(242)		—		(1,493)
Net cash (used for) provided by financing activities		(55,302)		90,425		(30,135)		54,468		59,456
Effect of exchange rate changes on cash and cash equivalents		—		—		(2,791)		—		(2,791)
Net increase (decrease) in cash, cash equivalents and restricted cash		(140)		(1)		(17,784)		—		(17,925)
Cash, cash equivalents and restricted cash, beginning of period		474		42		450,564		—		451,080
Cash, cash equivalents and restricted cash, end of period	$	334	$	41	$	432,780	$	—	$	433,155

Condensed Consolidating Statements Cash Flows


	Three Months Ended March 31, 2018
			Nabors		Other
	Nabors		Delaware		Subsidiaries
	(Parent/		(Issuer/		(Non-		Consolidating
	Guarantor)		Guarantor)		Guarantors)		Adjustments		Total
	(In thousands)
Net cash provided by (used for) operating activities	$	22,374	$	(98,371)	$	19,295	$	(24,981)	$	(81,683)
Cash flows from investing activities:
Purchases of investments		—		—		(676)		—		(676)
Sales and maturities of investments		—		—		1,148		—		1,148
Capital expenditures		—		—		(94,026)		—		(94,026)
Proceeds from sale of assets and insurance claims		—		—		3,076		—		3,076
Change in intercompany balances		—		(122,864)		122,864		—		—
Net cash provided by (used for) investing activities		—		(122,864)		32,386		—		(90,478)
Cash flows from financing activities:
Debt issuance costs		—		(12,928)		—		—		(12,928)
Reduction in long-term debt		—		(460,837)		—		—		(460,837)
Reduction in revolving credit facilities		—		(680,000)		—		—		(680,000)
Dividends to shareholders		(20,129)		—		—		2,981		(17,148)
Proceeds from (payments for) commercial paper, net		—		(40,000)		—		—		(40,000)
Proceeds from (payments for) issuance of intercompany debt		20,000		—		(20,000)		—		—
Proceeds from revolving credit facilities		—		615,000		—		—		615,000
Proceeds from issuance of long-term debt		—		800,000		—		—		800,000
Paydown of intercompany debt		(21,000)		—		21,000		—		—
Proceeds from (payments for) short-term borrowings		—		—		194		—		194
Distribution from subsidiary to parent		—		—		(22,000)		22,000		—
Other changes		(1,862)		—		(383)		—		(2,245)
Net cash (used for) provided by financing activities		(22,991)		221,235		(21,189)		24,981		202,036
Effect of exchange rate changes on cash and cash equivalents		—		—		(867)		—		(867)
Net increase (decrease) in cash, cash equivalents and restricted cash		(617)		—		29,625		—		29,008
Cash, cash equivalents and restricted cash, beginning of period		1,091		44		340,894		—		342,029
Cash, cash equivalents and restricted cash, end of period	$	474	$	44	$	370,519	$	—	$	371,037