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

6 Months Ended

Jun. 30, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidating Condensed Balance Sheet

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED BALANCE SHEET

(Dollars in Thousands)

(Unaudited)

	December 31, 2014
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	36,728		$	13,546		$	58,182		$	—		$	108,456
Accounts and notes receivable, net	(33		)	96,100			174,885			—			270,952
Rig materials and supplies	—			(1,473		)	49,416			—			47,943
Deferred costs	—			—			5,673			—			5,673
Deferred income taxes	—			6,131			1,345			—			7,476
Other tax assets	19,885			(18,273		)	9,111			—			10,723
Other current assets	—			7,999			10,557			—			18,556
Total current assets	56,580			104,030			309,169			—			469,779
Property, plant and equipment, net	(19		)	589,055			306,904			—			895,940
Intangible assets, net	—			—			4,286			—			4,286
Investment in subsidiaries and intercompany advances	3,060,867			2,441,527			2,464,502			(7,966,896		)	—
Other noncurrent assets	(440,918		)	490,597			268,537			(167,562		)	150,654
Total assets	$	2,676,510		$	3,625,209		$	3,353,398		$	(8,134,458	)	$	1,520,659
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	10,000		$	—		$	—		$	—		$	10,000
Accounts payable and accrued liabilities	77,603			71,645			309,344			(304,113		)	154,479
Accrued income taxes	(4,061		)	10,109			8,138			—			14,186
Total current liabilities	83,542			81,754			317,482			(304,113		)	178,665
Long-term debt	605,000			—			—			—			605,000
Other long-term liabilities	2,867			7,135			8,663			—			18,665
Long-term deferred tax liability	—			56,105			(3,990		)	—			52,115
Intercompany payables	1,322,172			1,311,405			1,204,768			(3,838,345		)	—
Total liabilities	2,013,581			1,456,399			1,526,923			(4,142,458		)	854,445
Total equity	662,929			2,168,810			1,826,475			(3,992,000		)	666,214
Total liabilities and stockholders’ equity	$	2,676,510		$	3,625,209		$	3,353,398		$	(8,134,458	)	$	1,520,659

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED BALANCE SHEET

(Dollars in Thousands)

(Unaudited)

	June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	42,153		$	20,496		$	54,294		$	—		$	116,943
Accounts and notes receivable, net	(33		)	73,014			162,853			—			235,834
Rig materials and supplies	—			(2,715		)	46,989			—			44,274
Deferred costs	—			—			7,281			—			7,281
Deferred income taxes	—			4,748			1,070			—			5,818
Other tax assets	5,085			(4,065		)	11,806			—			12,826
Other current assets	—			8,825			12,137			—			20,962
Total current assets	47,205			100,303			296,430			—			443,938
Property, plant and equipment, net	(19		)	575,087			290,223			—			865,291
Goodwill	—			6,708			—			—			6,708
Intangible assets, net	—			12,893			3,052			—			15,945
Investment in subsidiaries and intercompany advances	3,109,359			2,630,665			2,994,328			(8,734,352		)	—
Other noncurrent assets	(327,236		)	425,106			258,565			(166,639		)	189,796
Total assets	$	2,829,309		$	3,750,762		$	3,842,598		$	(8,900,991	)	$	1,521,678
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	—		$	—		$	—		$	—		$	—
Accounts payable and accrued liabilities	77,632			92,994			308,926			(303,305		)	176,247
Accrued income taxes	(3,322		)	11,659			4,257			—			12,594
Total current liabilities	74,310			104,653			313,183			(303,305		)	188,841
Long-term debt	585,000			—			—			—			585,000
Other long-term liabilities	2,867			6,893			9,424			—			19,184
Long-term deferred tax liability	—			71,957			(2,164		)	—			69,793
Intercompany payables	1,512,881			1,392,937			1,562,481			(4,468,299		)	—
Total liabilities	2,175,058			1,576,440			1,882,924			(4,771,604		)	862,818
Total equity	654,251			2,174,322			1,959,674			(4,129,387		)	658,860
Total liabilities and stockholders’ equity	$	2,829,309		$	3,750,762		$	3,842,598		$	(8,900,991	)	$	1,521,678

Consolidating Condensed Statement of Operations

	Three months ended June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Total revenues	—			63,276			162,703			(40,038		)	185,941
Operating expenses	—			35,627			147,980			(40,038		)	143,569
Depreciation and amortization	—			23,958			14,393			—			38,351
Total operating gross margin	—			3,691			330			—			4,021
General and administration expense (1)	(891		)	(12,924		)	4,304			—			(9,511		)
Provision for reduction in carrying value of certain assets	—			—			(2,316		)	—			(2,316		)
(Loss) on disposition of assets, net	—			(6		)	(132		)	—			(138		)
Total operating income (loss)	(891		)	(9,239		)	2,186			—			(7,944		)
Other income and (expense):
Interest expense	(11,066		)	(323		)	(3,010		)	3,003			(11,396		)
Interest income	165			3			2,854			(3,003		)	19
Other	—			11			(1,540		)	—			(1,529		)
Equity in net earnings of subsidiaries	(8,392		)	—			—			8,392			—
Total other income (expense)	(19,293		)	(309		)	(1,696		)	8,392			(12,906		)
Income (loss) before income taxes	(20,184		)	(9,548		)	490			8,392			(20,850		)
Total income tax expense (benefit)	(6,155		)	(2,361		)	1,600			—			(6,916		)
Net income (loss)	(14,029		)	(7,187		)	(1,110		)	8,392			(13,934		)
Less: Net income attributable to noncontrolling interest	—			—			95			—			95
Net income (loss) attributable to controlling interest	$	(14,029	)	$	(7,187	)	$	(1,205	)	$	8,392		$	(14,029	)

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

Consolidating Condensed Statements of Comprehensive Income (Loss)

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Dollars in Thousands)

(Unaudited)

	Three Months Ended June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations		Consolidated
Comprehensive income:
Net income (loss)	$	(14,029	)	$	(7,187	)	$	(1,110	)	$	8,392	$	(13,934	)
Other comprehensive income (loss), net of tax:
Currency translation difference on related borrowings	—			—			647			—		647
Currency translation difference on foreign currency net investments	—			—			1,723			—		1,723
Total other comprehensive income (loss), net of tax:	—			—			2,370			—		2,370
Comprehensive income (loss)	(14,029		)	(7,187		)	1,260			8,392		(11,564		)
Comprehensive (income) attributable to noncontrolling interest	—			—			(95		)	—		(95		)
Comprehensive income (loss) attributable to controlling interest	$	(14,029	)	$	(7,187	)	$	1,165		$	8,392	$	(11,659	)

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Dollars in Thousands)

(Unaudited)

	Three Months Ended June 30, 2014
	Parent		Guarantor		Non-Guarantor			Eliminations			Consolidated
Comprehensive income:
Net income (loss)	$	15,681	$	22,148	$	(1,333	)	$	(20,659	)	$	15,837
Other comprehensive income (loss), net of tax:
Currency translation difference on related borrowings	—		—		336			—			336
Currency translation difference on foreign currency net investments	—		—		(188		)	—			(188		)
Total other comprehensive income (loss), net of tax:	—		—		148			—			148
Comprehensive income (loss)	15,681		22,148		(1,185		)	(20,659		)	15,985
Comprehensive (income) attributable to noncontrolling interest	—		—		(80		)	—			(80		)
Comprehensive income (loss) attributable to controlling interest	$	15,681	$	22,148	$	(1,265	)	$	(20,659	)	$	15,905

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Dollars in Thousands)

(Unaudited)

	Six Months Ended June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Comprehensive income:
Net income (loss)	$	(10,807	)	$	(4,868	)	$	6,116		$	(597	)	$	(10,156	)
Other comprehensive income (loss), net of tax:
Currency translation difference on related borrowings	—			—			(1,023		)	—			(1,023		)
Currency translation difference on foreign currency net investments	—			—			874			—			874
Total other comprehensive income (loss), net of tax:	—			—			(149		)	—			(149		)
Comprehensive income (loss)	(10,807		)	(4,868		)	5,967			(597		)	(10,305		)
Comprehensive (income) attributable to noncontrolling interest	—			—			(489		)	—			(489		)
Comprehensive income (loss) attributable to controlling interest	$	(10,807	)	$	(4,868	)	$	5,478		$	(597	)	$	(10,794	)

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Dollars in Thousands)

(Unaudited)

	Six Months Ended June 30, 2014
	Parent		Guarantor		Non-Guarantor			Eliminations			Consolidated
Comprehensive income:
Net income (loss)	$	3,132	$	34,191	$	(2,729	)	$	(31,149	)	$	3,445
Other comprehensive income (loss), net of tax:
Currency translation difference on related borrowings	—		—		(468		)	—			(468		)
Currency translation difference on foreign currency net investments	—		—		511			—			511
Total other comprehensive income (loss), net of tax:	—		—		43			—			43
Comprehensive income (loss)	3,132		34,191		(2,686		)	(31,149		)	3,488
Comprehensive (income) attributable to noncontrolling interest	—		—		(234		)	—			(234		)
Comprehensive income (loss) attributable to controlling interest	$	3,132	$	34,191	$	(2,920	)	$	(31,149	)	$	3,254

Consolidated Condensed Statements of Cash Flows

ARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)

	Six Months Ended June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	(10,807	)	$	(4,868	)	$	6,116		$	(597	)	$	(10,156	)
Adjustments to reconcile net income (loss):
Depreciation and amortization	—			47,268			31,622			—			78,890
Accretion of contingent consideration	—			—			306			—			306
Provision for reduction in carrying value of certain assets	—			—			2,316			—			2,316
Gain on disposition of assets	—			(45		)	(2,258		)	—			(2,303		)
Deferred income tax expense	(22,414		)	6,574			(1,286		)	—			(17,126		)
Expenses not requiring cash	4,039			441			828			—			5,308
Equity in net earnings of subsidiaries	(597		)	—			—			597			—
Change in assets and liabilities:
Accounts and notes receivable	—			27,778			11,905			—			39,683
Other assets	(77,427		)	59,964			10,111			—			(7,352		)
Accounts payable and accrued liabilities	29			14,890			(156		)	—			14,763
Accrued income taxes	2,146			229			(3,611		)	—			(1,236		)
Net cash provided by (used in) operating activities	(105,031		)	152,231			55,893			—			103,093
Cash flows from investing activities:
Capital expenditures	—			(37,794		)	(16,811		)	—			(54,605		)
Proceeds from the sale of assets	—			82			206			—			288
Proceeds from insurance settlements	—			—			2,500			—			2,500
Acquisition, net of cash acquired	—			(10,431		)	—			—			(10,431		)
Net cash (used in) investing activities	—			(48,143		)	(14,105		)	—			(62,248		)
Cash flows from financing activities:
Repayments of long-term debt	(30,000		)	—			—			—			(30,000		)
Payment of debt issuance costs	(1,359		)	—			—			—			(1,359		)
Excess tax benefit from stock-based compensation	(999		)	—			—			—			(999		)
Intercompany advances, net	142,814			(97,138		)	(45,676		)	—			—
Net cash provided by (used in) financing activities	110,456			(97,138		)	(45,676		)	—			(32,358		)
Net change in cash and cash equivalents	5,425			6,950			(3,888		)	—			8,487
Cash and cash equivalents at beginning of year	36,728			13,546			58,182			—			108,456
Cash and cash equivalents at end of year	$	42,153		$	20,496		$	54,294		$	—		$	116,943

	Six Months Ended June 30, 2015
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	(10,807	)	$	(4,868	)	$	6,116		$	(597	)	$	(10,156	)
Adjustments to reconcile net income (loss):
Depreciation and amortization	—			47,268			31,622			—			78,890
Accretion of contingent consideration	—			—			306			—			306
Provision for reduction in carrying value of certain assets	—			—			2,316			—			2,316
Gain on disposition of assets	—			(45		)	(2,258		)	—			(2,303		)
Deferred income tax expense	(22,414		)	6,574			(1,286		)	—			(17,126		)
Expenses not requiring cash	4,039			441			828			—			5,308
Equity in net earnings of subsidiaries	(597		)	—			—			597			—
Change in assets and liabilities:
Accounts and notes receivable	—			27,778			11,905			—			39,683
Other assets	(77,427		)	59,964			10,111			—			(7,352		)
Accounts payable and accrued liabilities	29			14,890			(156		)	—			14,763
Accrued income taxes	2,146			229			(3,611		)	—			(1,236		)
Net cash provided by (used in) operating activities	(105,031		)	152,231			55,893			—			103,093
Cash flows from investing activities:
Capital expenditures	—			(37,794		)	(16,811		)	—			(54,605		)
Proceeds from the sale of assets	—			82			206			—			288
Proceeds from insurance settlements	—			—			2,500			—			2,500
Acquisition, net of cash acquired	—			(10,431		)	—			—			(10,431		)
Net cash (used in) investing activities	—			(48,143		)	(14,105		)	—			(62,248		)
Cash flows from financing activities:
Repayments of long-term debt	(30,000		)	—			—			—			(30,000		)
Payment of debt issuance costs	(1,359		)	—			—			—			(1,359		)
Excess tax benefit from stock-based compensation	(999		)	—			—			—			(999		)
Intercompany advances, net	142,814			(97,138		)	(45,676		)	—			—
Net cash provided by (used in) financing activities	110,456			(97,138		)	(45,676		)	—			(32,358		)
Net change in cash and cash equivalents	5,425			6,950			(3,888		)	—			8,487
Cash and cash equivalents at beginning of year	36,728			13,546			58,182			—			108,456
Cash and cash equivalents at end of year	$	42,153		$	20,496		$	54,294		$	—		$	116,943

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(Dollars in Thousands)

(Unaudited)

	Six Months Ended June 30, 2014
	Parent			Guarantor			Non-Guarantor			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	3,132		$	34,191		$	(2,729	)	$	(31,149	)	$	3,445
Adjustments to reconcile net income (loss)
Depreciation and amortization	—			41,175			29,342			—			70,517
Loss on extinguishment of debt	30,152			—			—			—			30,152
Gain on disposition of assets	80			(432		)	(538		)	—			(890		)
Deferred income tax expense	(19,621		)	8,917			2,346			—			(8,358		)
Expenses not requiring cash	7,939			(997		)	1,806			—			8,748
Equity in net earnings of subsidiaries	(31,149		)	—			—			31,149			—
Change in assets and liabilities:
Accounts and notes receivable	—			(6,132		)	5,066			—			(1,066		)
Other assets	37,589			(51,431		)	13,065			—			(777		)
Accounts payable and accrued liabilities	(19,629		)	20,886			4,532			—			5,789
Accrued income taxes	(5,231		)	9,481			(8,237		)	—			(3,987		)
Net cash provided by (used in) operating activities	3,262			55,658			44,653			—			103,573
Cash flows from investing activities:
Capital expenditures	—			(79,374		)	(26,814		)	—			(106,188		)
Proceeds from the sale of assets	—			1,008			2,338			—			3,346
Net cash (used in) investing activities	—			(78,366		)	(24,476		)	—			(102,842		)
Cash flows from financing activities:
Proceeds from debt issuance	400,000			—			—			—			400,000
Repayments of long-term debt	(430,000		)	—			—			—			(430,000		)
Payment of debt issuance costs	(7,425		)	—			—			—			(7,425		)
Payment of debt extinguishment costs	(26,214		)	—			—			—			(26,214		)
Excess tax benefit from stock-based compensation	665			—			—			—			665
Intercompany advances, net	(2,619		)	21,836			(19,217		)	—			—
Net cash provided by (used in) financing activities	(65,593		)	21,836			(19,217		)	—			(62,974		)
Net change in cash and cash equivalents	(62,331		)	(872		)	960			—			(62,243		)
Cash and cash equivalents at beginning of year	88,697			8,310			51,682			—			148,689
Cash and cash equivalents at end of year	$	26,366		$	7,438		$	52,642		$	—		$	86,446