Segment Information

12 Months Ended

Dec. 31, 2020

Segment Information

Segment Information

Note 19 Segment Information

Our business consists of five reportable segments: U.S. Drilling, Canada Drilling, International Drilling, Drilling Solutions and Rig Technologies. The accounting policies of the segments are the same as those described in Note 2—Summary of Significant Accounting Policies. Inter-segment sales are recorded at cost or cost plus a profit margin. We evaluate the performance of our segments based on several criteria, including adjusted operating income (loss).

The following table sets forth financial information with respect to our reportable operating segments:

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Operating revenues:
U.S. Drilling	$	713,057	$	1,240,936	$	1,083,227
Canada Drilling		54,753		68,274		105,000
International Drilling		1,131,673		1,324,142		1,469,038
Drilling Solutions		149,834		252,790		250,242
Rig Technologies		131,555		260,226		270,988
Other reconciling items (1)		(46,829)		(102,985)		(120,876)
Total	$	2,134,043	$	3,043,383	$	3,057,619

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Adjusted operating income (loss): (2)
U.S. Drilling	$	(96,176)	$	64,313	$	(21,298)
Canada Drilling		(11,766)		(14,483)		(6,166)
International Drilling		(56,205)		(8,903)		74,221
Drilling Solutions		6,167		59,465		37,626
Rig Technologies		(13,481)		(11,247)		(25,762)
Total segment adjusted operating income (loss)	$	(171,461)	$	89,145	$	58,621

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Reconciliation of segment adjusted operating income (loss) to net income (loss) from continuing operations before income taxes:
Total segment adjusted operating income (loss) (2)	$	(171,461)	$	89,145	$	58,621
Other reconciling items (3)		(118,346)		(160,274)		(166,815)
Earnings (losses) from unconsolidated affiliates		—		(5)		1
Investment income (loss)		1,438		10,218		(9,499)
Interest expense		(206,274)		(204,311)		(227,124)
Gain/(loss) on debt buybacks and exchanges		228,274		11,468		(5,268)
Impairments and other charges		(410,631)		(301,939)		(139,178)
Other, net		(28,567)		(33,224)		(29,532)
Income (loss) from continuing operations before income taxes	$	(705,567)	$	(588,922)	$	(518,794)

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Depreciation and amortization
U.S. Drilling	$	398,326	$	419,680	$	394,586
Canada Drilling		24,784		29,766		37,172
International Drilling		377,599		372,883		383,227
Drilling Solutions		40,074		32,289		31,037
Rig Technologies		15,299		12,715		16,387
Other reconciling items (3)		(2,383)		8,758		4,461
Total	$	853,699	$	876,091	$	866,870

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Capital expenditures:
U.S. Drilling	$	44,606	$	184,705	$	222,338
Canada Drilling		2,018		5,020		12,981
International Drilling		127,888		209,728		172,565
Drilling Solutions		12,306		23,598		30,709
Rig Technologies		2,637		6,592		12,250
Other reconciling items (3)		251		(5,676)		2,592
Total	$	189,706	$	423,967	$	453,435

	December 31,
	2020		2019
	(In thousands)
Total assets:
U.S. Drilling	$	1,871,008	$	2,369,200
Canada Drilling		174,123		202,706
International Drilling		2,688,912		2,979,494
Drilling Solutions		100,278		218,004
Rig Technologies		225,954		324,523
Other reconciling items (3)		443,153		666,731
Total	$	5,503,428	$	6,760,658

(1) Represents the elimination of inter-segment transactions related to our Rig Technologies operating segment.

(2) Adjusted operating income (loss) represents income (loss) from continuing operations before income taxes, interest expense, earnings (losses) from unconsolidated affiliates, investment income (loss), (gain)/loss on debt buybacks and exchanges, impairments and other charges and other, net. Management evaluates the performance of our operating segments using adjusted operating income (loss), which is a segment performance measure, because it believes that this financial measure reflects our ongoing profitability and performance. In addition, securities analysts and investors use this measure as one of the metrics on which they analyze our performance. A reconciliation to income (loss) from continuing operations before income taxes is provided in the above table.

(3) Represents the elimination of inter-segment transactions and unallocated corporate expenses, assets and capital expenditures.

The following table sets forth financial information with respect to Nabors’ operations by geographic area based on the location of service provided:

	Year Ended December 31,
	2020		2019		2018
	(In thousands)
Operating revenues
U.S.	$	841,531	$	1,554,442	$	1,347,448
Outside the U.S.		1,292,512		1,488,941		1,710,171
	$	2,134,043	$	3,043,383	$	3,057,619
Property, plant and equipment, net:
U.S.	$	1,917,203	$	2,470,579	$	2,892,910
Outside the U.S.		2,068,504		2,459,970		2,574,960
	$	3,985,707	$	4,930,549	$	5,467,870
Goodwill:
U.S.	$	—	$	13,430	$	65,633
Outside the U.S.		—		14,950		118,281
	$	—	$	28,380	$	183,914

During the years ended December 31, 2020, 2019 and 2018, $642.7 million, $696.4 million and $764.5 million of our consolidated operating revenue was from Saudi Arabia. No other individual country outside of the U.S. was material to our consolidated operating revenue during any of the three periods presented.

One customer accounted for approximately 29%, 22% and 24% of our consolidated operating revenues during the years ended December 31, 2020, 2019 and 2018, respectively, and is included primarily in our International Drilling reportable segment.