Financial Information Related to Guarantor Subsidiaries

6 Months Ended

Jun. 30, 2011

Financial Information Related to Guarantor Subsidiaries [Abstract]

Financial Information Related to Guarantor Subsidiaries

(21) Financial Information Related to Guarantor Subsidiaries

In April 2011, SESI, L.L.C. (Issuer), a wholly-owned subsidiary of Superior Energy Services, Inc. (Parent), issued $500 million of unsecured 6 3/8% senior notes due 2019. The Parent, along with substantially all of its domestic subsidiaries, fully and unconditionally guaranteed the senior notes, and such guarantees are joint and several. All of the guarantor subsidiaries are wholly-owned subsidiaries of the Issuer. Domestic income taxes are paid by the Parent through a consolidated tax return and are accounted for by the Parent. The following tables present the condensed consolidating balance sheets as of June 30, 2011 and December 31, 2010 and the condensed consolidating statements of operations and cash flows for the three and six months ended June 30, 2011 and 2010.

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Balance Sheets
June 30, 2011
(in thousands)

										Non-
							Guarantor			Guarantor
	Parent			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	185,133		$	4,729		$	54,252		$	—		$	244,114
Short-term investments		—			164,161			—			—			—			164,161
Accounts receivable, net		—			241			371,205			104,847			(38,339	)		437,954
Income taxes receivable		—			—			—			5,539			(5,539	)		—
Prepaid expenses		89			7,589			15,639			15,545			—			38,862
Inventory and other current assets		—			1,427			207,035			11,948			—			220,410
Intercompany interest receivable		—			28,694			—			—			(28,694	)		—
Total current assets		89			387,245			598,608			192,131			(72,572	)		1,105,501
Property, plant and equipment, net		—			2,956			1,007,942			384,020			—			1,394,918
Goodwill, net		—			—			446,947			142,814			—			589,761
Notes receivable		—			—			71,261			—			—			71,261
Intercompany notes receivable		—			488,637			—			—			(488,637	)		—
Investments in subsidiaries		124,271			593,994			—			—			(718,265	)		—
Equity-method investments		—			61,476			—			1,832			—			63,308
Intangible and other long-term assets, net		—			30,867			77,593			28,428			—			136,888
Total assets	$	124,360		$	1,565,175		$	2,202,351		$	749,225		$	(1,279,474	)	$	3,361,637
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—		$	4,144		$	75,462		$	68,434		$	(38,873	)	$	109,167
Accrued expenses		115			38,736			88,677			42,855			—			170,383
Income taxes payable		14,494			—			—			—			(5,539	)		8,955
Deferred income taxes		22,374			—			—			1,653			—			24,027
Current portion of decommissioning liabilities		—			—			17,172			—			—			17,172
Current maturities of long-term debt		—			390,452			—			810			—			391,262
Intercompany interest payable		—			—			—			28,694			(28,694	)		—
Total current liabilities		36,983			433,332			181,311			142,446			(73,106	)		720,966
Deferred income taxes		215,691			—			—			12,500			—			228,191
Decommissioning liabilities		—			—			103,880			—			—			103,880
Long-term debt, net		—			798,043			—			12,141			—			810,184
Intercompany notes payable		—			—			—			488,637			(488,637	)		—
Intercompany payables/(receivables)		(99,845	)		897,383			(139,540	)		(123,009	)		(534,989	)		—
Other long-term liabilities		8,260			38,599			27,138			47,803			—			121,800
Stockholders’ equity:
Preferred stock of $.01 par value		—			—			—			—			—			—
Common stock of $.001 par value		80			—			—			403			(403	)		80
Additional paid in capital		439,164			124,271			—			58,068			(182,339	)		439,164
Accumulated other comprehensive income (loss), net		—			—			—			(17,134	)		—			(17,134	)
Retained earnings (accumulated deficit)		(475,973	)		(726,453	)		2,029,562			127,370			—			954,506
Total stockholders’ equity		(36,729	)		(602,182	)		2,029,562			168,707			(182,742	)		1,376,616
Total liabilities and stockholders’ equity	$	124,360		$	1,565,175		$	2,202,351		$	749,225		$	(1,279,474	)	$	3,361,637

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Balance Sheets
December 31, 2010
(in thousands)

										Non-
							Guarantor			Guarantor
	Parent			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	—		$	5,493		$	45,234		$	—		$	50,727
Accounts receivable, net		—			415			382,935			99,010			(29,910	)		452,450
Income tax receivable		—			—			—			2,024			(2,024	)		—
Prepaid expenses		18			4,128			8,948			12,734			—			25,828
Inventory and other current assets		—			1,678			222,822			10,547			—			235,047
Intercompany interest receivable		—			15,883			—			—			(15,883	)		—
Total current assets		18			22,104			620,198			169,549			(47,817	)		764,052
Property, plant and equipment, net		—			3,189			957,561			352,400			—			1,313,150
Goodwill, net		—			—			447,467			140,533			—			588,000
Notes receivable		—			—			69,026			—			—			69,026
Intercompany notes receivable		—			456,280			—			—			(456,280	)		—
Investments in subsidiaries		124,271			602,461			4,347			4,347			(735,426	)		—
Equity-method investments		—			43,947			—			15,375			—			59,322
Intangible and other long-term assets, net		—			22,455			61,722			29,806			—			113,983
Total assets	$	124,289		$	1,150,436		$	2,160,321		$	712,010		$	(1,239,523	)	$	2,907,533
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—		$	6,654		$	71,790		$	64,636		$	(32,804	)	$	110,276
Accrued expenses		153			42,821			91,451			27,619			—			162,044
Income taxes payable		4,499			—			—			—			(2,024	)		2,475
Deferred income taxes		29,353			—			—			—			—			29,353
Current portion of decommissioning liabilities		—			—			16,929			—			—			16,929
Current maturities of long-term debt		—			184,000			—			810			—			184,810
Intercompany interest payable		—			—			—			15,883			(15,883	)		—
Total current liabilities		34,005			233,475			180,170			108,948			(50,711	)		505,887
Deferred income taxes		211,173			—			—			12,763			—			223,936
Decommissioning liabilities		—			—			100,787			—			—			100,787
Long-term debt, net		—			669,089			—			12,546			—			681,635
Intercompany notes payable		—			—			—			456,280			(456,280	)		—
Intercompany payables/(receivables)		(100,882	)		760,164			(1,407	)		(125,246	)		(532,629	)		—
Other long-term liabilities		8,260			37,537			19,427			49,513			—			114,737
Stockholders’ equity:
Preferred stock of $.01 par value		—			—			4,347			4,347			(8,694	)		—
Common stock of $.001 par value		79			—			—			176			(176	)		79
Additional paid in capital		415,278			124,271			—			66,762			(191,033	)		415,278
Accumulated other comprehensive loss, net		—			—			—			(25,700	)		—			(25,700	)
Retained earnings (accumulated deficit)		(443,624	)		(674,100	)		1,856,997			151,621			—			890,894
Total stockholders’ equity (deficit)		(28,267	)		(549,829	)		1,861,344			197,206			(199,903	)		1,280,551
Total liabilities and stockholders’ equity	$	124,289		$	1,150,436		$	2,160,321		$	712,010		$	(1,239,523	)	$	2,907,533

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Operations
Three Months Ended June 30, 2011
(in thousands)

									Non-
							Guarantor		Guarantor
	Parent			Issuer			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Revenues	$	—		$	—		$	434,235	$	97,714		$	(21,143	)	$	510,806
Costs and expenses:
Cost of services (exclusive of items shown separately below)		—			—			221,684		70,766			(21,080	)		271,370
Depreciation, depletion, amortization and accretion		—			129			51,741		11,444			—			63,314
General and administrative expenses		205			20,329			55,785		19,625			(63	)		95,881
Gain on sale of business		—			—			5,884		—			—			5,884
Income (loss) from operations		(205	)		(20,458	)		110,909		(4,121	)		—			86,125
Other income (expense):
Interest expense, net		—			(17,499	)		1,212		(166	)		—			(16,453	)
Intercompany interest income/ (expense)		—			6,605			—		(6,605	)		—			—
Earnings (losses) from equity-method investments, net		—			5,278			—		221			—			5,499
Income (loss) before income taxes		(205	)		(26,074	)		112,121		(10,671	)		—			75,171
Income taxes		24,220			—			—		2,842			—			27,062
Net income (loss)	$	(24,425	)	$	(26,074	)	$	112,121	$	(13,513	)	$	—		$	48,109

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Operations
Three Months Ended June 30, 2010
(in thousands)

									Non-
							Guarantor		Guarantor
	Parent			Issuer			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Revenues	$	—		$	—		$	361,612	$	86,205		$	(22,961	)	$	424,856
Costs and expenses:
Cost of services (exclusive of items shown separately below)		—			—			193,793		59,084			(22,961	)		229,916
Depreciation, depletion, amortization and accretion		—			128			44,446		9,725			—			54,299
General and administrative expenses		79			33,446			47,786		11,218			—			92,529
Income (loss) from operations		(79	)		(33,574	)		75,587		6,178			—			48,112
Other income (expense):
Interest income (expense), net		—			(13,311	)		1,259		(628	)		—			(12,680	)
Intercompany interest income/(expense)		—			3,526			—		(3,526	)		—			—
Earnings from equity-method investments, net		—			1,667			—		503			—			2,170
Income (loss) before income taxes		(79	)		(41,692	)		76,846		2,527			—			37,602
Income taxes		11,656			—			—		1,881			—			13,537
Net income (loss)	$	(11,735	)	$	(41,692	)	$	76,846	$	646		$	—		$	24,065

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Operations
Six Months Ended June 30, 2011
(in thousands)

									Non-
							Guarantor		Guarantor
	Parent			Issuer			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Revenues	$	—		$	—		$	785,875	$	175,832		$	(36,920	)	$	924,787
Costs and expenses:
Cost of services (exclusive of items shown separately below)		—			—			415,770		126,238			(36,793	)		505,215
Depreciation, depletion, amortization and accretion		—			257			100,432		21,988			—			122,677
General and administrative expenses		530			39,247			107,954		35,156			(127	)		182,760
Gain on sale of business		—			—			8,558		—			—			8,558
Income (loss) from operations		(530	)		(39,504	)		170,277		(7,550	)		—			122,693
Other income (expense):
Interest expense, net		—			(30,060	)		2,288		(1,053	)		—			(28,825	)
Intercompany interest income/(expense)		—			12,811			—		(12,811	)		—			—
Earnings (losses) from equity-method investments, net		—			4,400			—		1,126			—			5,526
Income (loss) before income taxes		(530	)		(52,353	)		172,565		(20,288	)		—			99,394
Income taxes		31,819			—			—		3,963			—			35,782
Net income (loss)	$	(32,349	)	$	(52,353	)	$	172,565	$	(24,251	)	$	—		$	63,612

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Operations
Six Months Ended June 30, 2010
(in thousands)

									Non-
							Guarantor		Guarantor
	Parent			Issuer			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Revenues	$	—		$	—		$	670,101	$	153,972		$	(34,706	)	$	789,367
Costs and expenses:
Cost of services (exclusive of items shown separately below)		—			—			364,239		99,435			(34,706	)		428,968
Depreciation, depletion, amortization and accretion		—			257			87,165		17,925			—			105,347
General and administrative expenses		168			50,643			91,247		21,195			—			163,253
Income (loss) from operations		(168	)		(50,900	)		127,450		15,417			—			91,799
Other income (expense):
Interest income (expense), net		—			(27,333	)		1,957		(1,342	)		—			(26,718	)
Intercompany interest income/(expense)		—			5,673			—		(5,673	)		—			—
Earnings from equity-method investments, net		—			2,500			—		3,655			—			6,155
Income (loss) before income taxes		(168	)		(70,060	)		129,407		12,057			—			71,236
Income taxes		20,035			—			—		5,610			—			25,645
Net income (loss)	$	(20,203	)	$	(70,060	)	$	129,407	$	6,447		$	—		$	45,591

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Cash Flows
Six Months Ended June 30, 2011
(in thousands)

										Non-
							Guarantor			Guarantor
	Parent			Issuer			Subsidiaries			Subsidiaries			Consolidated
Cash flows from operating activities:
Net income (loss)	$	(32,349	)	$	(52,353	)	$	172,565		$	(24,251	)	$	63,612
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion, amortization and accretion		—			257			100,432			21,988			122,677
Deferred income taxes		(2,461	)		—			—			1,094			(1,367	)
Stock-based and performance share unit compensation expense, net		—			4,888			—			—			4,888
Retirement and deferred compensation plans expense, net		—			486			—			—			486
(Earnings) losses from equity-method investments, net		—			(2,863	)		—			(1,126	)		(3,989	)
Amortization of debt acquisition costs and note discount		—			12,700			—			—			12,700
Gain on sale of business		—			—			(8,558	)		—			(8,558	)
Other reconciling items, net		—			(771	)		(2,235	)		—			(3,006	)
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Receivables		—			174			12,627			3,972			16,773
Inventory and other current assets		—			252			12,695			(2,282	)		10,665
Accounts payable		—			583			(1,041	)		1,410			952
Accrued expenses		(37	)		(1,189	)		2,111			9,724			10,609
Income taxes		6,680			—			—			(3,634	)		3,046
Other, net		(71	)		(2,475	)		1,399			(351	)		(1,498	)
Net cash provided by (used in) operating activities		(28,238	)		(40,311	)		289,995			6,544			227,990
Cash flows from investing activities:
Payments for capital expenditures		—			(25	)		(170,252	)		(46,405	)		(216,682	)
Purchases of short-term investments, net		—			(164,130	)		—			—			(164,130	)
Cash proceeds from sale of business		—			—			22,349			—			22,349
Other		—			—			(6,134	)		—			(6,134	)
Intercompany receivables/payables		6,624			80,062			(136,722	)		50,036			—
Net cash provided by (used in) investing activities		6,624			(84,093	)		(290,759	)		3,631			(364,597	)
Cash flows from financing activities:
Net payments on revolving credit facility		—			(175,000	)		—			—			(175,000	)
Proceeds from long-term debt		—			500,000			—			—			500,000
Principal payments on long-term debt		—			—			—			(405	)		(405	)
Payment of debt acquisition costs		—			(9,363	)		—			—			(9,363	)
Proceeds from exercise of stock options		10,129			—			—			—			10,129
Excess tax benefit from stock-based compensation		10,262			—			—			—			10,262
Proceeds from issuance of stock through employee benefit plans		1,223			—			—			—			1,223
Other		—			(6,100	)		—			(1,529	)		(7,629	)
Net cash provided by (used in) financing activities		21,614			309,537			—			(1,934	)		329,217
Effect of exchange rate changes on cash		—			—			—			777			777
Net increase (decrease) in cash and cash equivalents		—			185,133			(764	)		9,018			193,387
Cash and cash equivalents at beginning of period		—			—			5,493			45,234			50,727
Cash and cash equivalents at end of period	$	—		$	185,133		$	4,729		$	54,252		$	244,114

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Cash Flows
Six Months Ended June 30, 2010
(in thousands)

										Non-
							Guarantor			Guarantor
	Parent			Issuer			Subsidiaries			Subsidiaries			Consolidated
Cash flows from operating activities:
Net income (loss)	$	(20,203	)	$	(70,060	)	$	129,407		$	6,447		$	45,591
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, amortization and accretion		—			257			87,165			17,925			105,347
Deferred income taxes		14,398			—			—			(651	)		13,747
Stock-based and performance share unit compensation expense		—			4,385			—			—			4,385
Retirement and deferred compensation plans expense, net		—			5,461			—			—			5,461
(Earnings) losses from equity-method investments, net		—			5,100			—			(2,592	)		2,508
Amortization of debt acquisition costs		—			11,731			—			—			11,731
Other, net		—			372			(2,157	)		—			(1,785	)
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Receivables		—			4			(25,064	)		(11,825	)		(36,885	)
Inventory and other current assets		—			165			73,900			(614	)		73,451
Accounts payable		—			(197	)		6,617			2,344			8,764
Accrued expenses		(4	)		1,454			1,334			721			3,505
Income taxes		10,318			—			—			1,252			11,570
Other, net		(1,097	)		(2,671	)		14,258			(821	)		9,669
Net cash provided by operating activities		3,412			(43,999	)		285,460			12,186			257,059
Cash flows from investing activities:
Payments for capital expenditures		—			—			(96,247	)		(51,568	)		(147,815	)
Acquisitions of businesses, net of cash acquired		—			—			(1,000	)		(206,772	)		(207,772	)
Other		—			963			(5,888	)		(252	)		(5,177	)
Intercompany receivables/payables		(4,971	)		(90,606	)		(183,678	)		279,255			—
Net cash provided by (used in) investing activities		(4,971	)		(89,643	)		(286,813	)		20,663			(360,764	)
Cash flows from financing activities:
Net payments on revolving credit facility		—			(37,400	)		—			—			(37,400	)
Principal payments on long-term debt		—			—			—			(405	)		(405	)
Proceeds from exercise of stock options		342			—			—			—			342
Tax benefit from exercise of stock options		163			—			—			—			163
Proceeds from issuance of stock through employee benefit plans		1,054			—			—			—			1,054
Other		—			—			—			(1,314	)		(1,314	)
Net cash provided by (used in) financing activities		1,559			(37,400	)		—			(1,719	)		(37,560	)
Effect of exchange rate changes on cash		—			—			—			(1,191	)		(1,191	)
Net increase (decrease) in cash and cash equivalents		—			(171,042	)		(1,353	)		29,939			(142,456	)
Cash and cash equivalents at beginning of period		—			171,903			4,871			29,731			206,505
Cash and cash equivalents at end of period	$	—		$	861		$	3,518		$	59,670		$	64,049