Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2016 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | MCDERMOTT INTERNATIONAL INC | |
Entity Central Index Key | 708,819 | |
Document Type | 8-K | |
Current Fiscal Year End Date | Dec. 31, 2016 | |
Entity Public Float | $ 1.2 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Income Statement [Abstract] | ||||
Revenues | [1] | $ 2,635,983 | $ 3,070,275 | $ 2,300,889 |
Costs and Expenses: | ||||
Cost of operations | 2,249,270 | 2,690,560 | 2,111,958 | |
Research and development expense | 346 | 724 | 1,055 | |
Selling, general and administrative expenses | 178,752 | 217,239 | 208,564 | |
Impairment loss (recovery) | 54,958 | 6,808 | (9,002) | |
Loss (gain) on asset disposals | (859) | 1,443 | (46,201) | |
Restructuring expenses | 11,263 | 40,819 | 18,113 | |
Total costs and expenses | 2,493,730 | 2,957,593 | 2,284,487 | |
Operating income | [2] | 142,253 | 112,682 | 16,402 |
Other income (expense): | ||||
Interest expense, net | (58,871) | (50,058) | (60,877) | |
Other non-operating income (expense), net | (1,067) | 1,986 | 7,002 | |
Total other expense, net | (59,938) | (48,072) | (53,875) | |
Income (loss) before provision for income taxes | 82,315 | 64,610 | (37,473) | |
Provision for income taxes | 41,926 | 51,963 | 20,073 | |
Income (loss) before loss from Investments in Unconsolidated Affiliates | 40,389 | 12,647 | (57,546) | |
Loss from Investments in Unconsolidated Affiliates | (4,090) | (21,486) | (7,848) | |
Net income (loss) | 36,299 | (8,839) | (65,394) | |
Less: Net income attributable to noncontrolling interest | 2,182 | 9,144 | 10,600 | |
Net income (loss) attributable to McDermott International, Inc. | $ 34,117 | $ (17,983) | $ (75,994) | |
Net income (loss) attributable to McDermott International, Inc.: | ||||
Basic | $ 0.14 | $ (0.08) | $ (0.32) | |
Diluted | $ 0.12 | $ (0.08) | $ (0.32) | |
Shares used in the computation of net income (loss) per share: | ||||
Basic | 240,359,363 | 238,240,763 | 237,229,086 | |
Diluted | 284,184,239 | 238,240,763 | 237,229,086 | |
[1] | Intercompany transactions were not significant during 2016, 2015 and 2014. | |||
[2] | The 2016 and 2015 Corporate and Other operating results include $55 million and $7 million of impairment, respectively. The 2014 Corporate and Other operating results include $11 million of improvements to the cancellation cost estimate included in the $38 million vessel impairment charge recognized in 2013. See Note 13, Fair Value Measurements, for further discussion. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net income (loss) | $ 36,299 | $ (8,839) | $ (65,394) |
Other comprehensive income (loss), net of tax: | |||
Unrealized gain on investments | 22 | 6 | 3 |
Gain (loss) on derivatives | 39,148 | 18,480 | (37,537) |
Foreign currency translation | (12,157) | (14,713) | (12,653) |
Other comprehensive income (loss), net of tax | 27,013 | 3,773 | (50,187) |
Total comprehensive income (loss) | 63,312 | (5,066) | (115,581) |
Less: Comprehensive income attributable to non-controlling interests | 2,135 | 9,064 | 10,511 |
Comprehensive income (loss) attributable to McDermott International, Inc. | $ 61,177 | $ (14,130) | $ (126,092) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Current assets: | |||
Cash and cash equivalents | $ 595,921 | $ 664,844 | |
Restricted cash and cash equivalents | 16,412 | 116,801 | |
Accounts receivable—trade, net | 334,384 | 208,474 | |
Accounts receivable—other | 36,929 | 66,689 | |
Contracts in progress | 319,138 | 435,829 | |
Other current assets | 29,599 | 34,641 | |
Total current assets | 1,332,383 | 1,527,278 | |
Property, plant and equipment | 2,586,179 | 2,467,352 | |
Less accumulated depreciation | (898,878) | (856,493) | |
Property, plant and equipment, net | [1] | 1,687,301 | 1,610,859 |
Accounts receivable—long-term retainages | 127,193 | 155,061 | |
Investments in Unconsolidated Affiliates | 17,023 | 26,551 | |
Deferred income taxes | 21,116 | 18,822 | |
Other assets | 37,214 | 48,505 | |
Total assets | 3,222,230 | 3,387,076 | |
Current liabilities: | |||
Notes payable and current maturities of long-term debt | 48,125 | 24,882 | |
Accounts payable | 173,203 | 279,821 | |
Accrued liabilities | 277,584 | 330,943 | |
Advance billings on contracts | 192,486 | 164,773 | |
Income taxes payable | 17,945 | 23,787 | |
Total current liabilities | 709,343 | 824,206 | |
Long-term debt | 704,395 | 819,001 | |
Self-insurance | 16,980 | 18,653 | |
Pension liabilities | 19,471 | 24,066 | |
Non-current income taxes | 60,870 | 52,559 | |
Other liabilities | 115,703 | 101,870 | |
Commitments and contingencies | |||
Stockholders' equity: | |||
Common stock, par value $1.00 per share, authorized 400,000,000 shares; issued 249,690,281 and 246,841,128 shares, respectively | 249,690 | 246,841 | |
Capital in excess of par value (including prepaid common stock purchase contracts) | 1,695,119 | 1,687,059 | |
Accumulated deficit | (226,767) | (260,884) | |
Accumulated other comprehensive loss | (66,895) | (93,955) | |
Treasury stock, at cost: 8,302,004 and 7,824,204 shares, respectively | (94,957) | (92,262) | |
Stockholders' Equity—McDermott International, Inc. | 1,556,190 | 1,486,799 | |
Noncontrolling interest | 39,278 | 59,922 | |
Total equity | 1,595,468 | 1,546,721 | |
Total liabilities and equity | $ 3,222,230 | $ 3,387,076 | |
[1] | Our marine vessels are included in the country in which they were located as of year-end. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 249,690,281 | 246,841,128 |
Treasury stock, shares | 8,302,004 | 7,824,204 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | ||||
Cash flows from operating activities: | ||||||
Net income (loss) | $ 36,299 | $ (8,839) | $ (65,394) | |||
Non-cash items included in net income (loss): | ||||||
Depreciation and amortization | 89,882 | 100,334 | 93,185 | |||
Drydock amortization | 12,795 | 17,947 | 19,719 | |||
Impairment loss (recovery) | 54,958 | 6,808 | (9,002) | |||
Stock-based compensation charges | 22,680 | 16,593 | 18,565 | |||
Loss from investments in Unconsolidated Affiliates | 4,090 | 21,486 | 7,848 | |||
(Gain) loss on foreign currency, net | (5,984) | 6,238 | (10,310) | |||
Restructuring expense (gain) | (1,350) | 7,473 | (2,310) | |||
Loss (gain) on asset disposals | (859) | 1,443 | (46,201) | |||
Deferred income taxes | (2,695) | 3,525 | 891 | |||
Pension (gain) expense | (3,228) | 19,821 | (4,291) | |||
Debt issuance cost amortization | 13,141 | 12,767 | 22,915 | |||
Other non-cash items | (5,392) | 1,269 | 686 | |||
Changes in operating assets and liabilities that provided (used) cash: | ||||||
Accounts receivable | (89,776) | (82,697) | 166,385 | |||
Contracts in progress, net of Advance billings on contracts | 144,412 | (113,338) | (10,695) | |||
Accounts payable | (101,845) | 78,646 | (154,439) | |||
Accrued and other current liabilities | (37,064) | (33,969) | (2,801) | |||
Pension liability | (1,684) | (1,506) | (1,861) | |||
Income taxes | 2,469 | 1,778 | (4,668) | |||
Other assets and liabilities, net | 47,330 | (507) | (11,262) | |||
Total cash provided by operating activities | 178,179 | 55,272 | 6,960 | |||
Cash flows from investing activities: | ||||||
Purchases of property, plant and equipment | (228,079) | [1] | (102,851) | [1] | (321,187) | [1] |
Investments in unconsolidated affiliates | (5,093) | (7,038) | (2,420) | |||
Proceeds from asset dispositions | 2,366 | 10,724 | 71,961 | |||
Sales and maturities of available-for-sale securities | 3,176 | 12,978 | ||||
Purchases of available-for-sale securities | (3,695) | |||||
Other investing activities | 417 | (2,706) | ||||
Total cash used in investing activities | (230,806) | (95,572) | (245,069) | |||
Cash flows from financing activities: | ||||||
Repayment of debt | (103,020) | (26,938) | (298,534) | |||
Proceeds from debt | 1,328,875 | |||||
Repurchase of common stock | (4,022) | (1,720) | (1,707) | |||
Payment of debt issuance costs | (8,730) | (170) | (39,112) | |||
Distributions to noncontrolling interests | (6,352) | |||||
Issuance of common stock | 682 | 327 | ||||
Acquisition of noncontrolling interest | (24) | (32,943) | ||||
Total cash provided by (used in) financing activities | (115,772) | (28,170) | 950,554 | |||
Effects of exchange rate changes on cash, cash equivalents and restricted cash | (913) | (2,779) | (1,905) | |||
Net increase (decrease) in cash, cash equivalents and restricted cash | (169,312) | (71,249) | 710,540 | |||
Cash, cash equivalents and restricted cash at beginning of year | 781,645 | 852,894 | 142,354 | |||
Cash, cash equivalents and restricted cash at end of year | 612,333 | 781,645 | 852,894 | |||
Cash paid during the period for: | ||||||
Income taxes, net of refunds | 37,710 | 40,560 | 26,661 | |||
Cash paid for interest, net of amounts capitalized | 46,693 | 40,690 | 28,390 | |||
Supplemental Disclosure of Noncash Investing Activities: | ||||||
Non-cash purchase (sale) of investments in unconsolidated affiliates | (12,377) | $ 2,396 | ||||
Capital lease | 3,407 | |||||
Supplemental Disclosure of Noncash Financing Activities: | ||||||
Note payable in connection with noncontrolling interest distribution | 5,000 | |||||
Non-cash acquisition of noncontrolling interest | $ 17,779 | $ 11,136 | ||||
[1] | Total capital expenditures represent expenditures for which cash payments were made during the period. Capital expenditures for 2016, 2015 and 2014 include $4 million, $14 million and $27 million of cash payments for accrued capital expenditures outstanding as of December 31, 2015, 2014 and 2013, respectively. |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common Stock Par Value [Member] | Capital in Excess of Par Value [Member] | Retained Earnings/(Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) ("AOCI") [Member] | Treasury Stock [Member] | Stockholder's Equity [Member] | Noncontrolling Interest ("NCI") [Member] |
Beginning Balance at Dec. 31, 2013 | $ 1,440,344 | $ 244,271 | $ 1,414,457 | $ (163,578) | $ (47,710) | $ (97,926) | $ 1,349,514 | $ 90,830 |
Net income (loss) | (65,394) | (75,994) | (75,994) | 10,600 | ||||
Other comprehensive income (loss), net of tax | (50,187) | (50,098) | (50,098) | (89) | ||||
Common stock issued | 327 | 939 | (612) | 327 | ||||
Issuance of tangible equity units | 240,044 | 240,044 | 240,044 | |||||
Stock-based compensation charges | 16,516 | 13,324 | 3,192 | 16,516 | ||||
Purchase of shares from NCI | (32,943) | 11,136 | 11,136 | (44,079) | ||||
Purchase of treasury shares | (1,707) | (1,707) | (1,707) | |||||
Sales of subsidiary shares to NCI | (1,534) | (1,534) | (1,534) | |||||
Distributions to NCI | (6,352) | (6,352) | ||||||
Ending Balance at Dec. 31, 2014 | 1,539,114 | 245,210 | 1,676,815 | (239,572) | (97,808) | (96,441) | 1,488,204 | 50,910 |
Net income (loss) | (8,839) | (17,983) | (17,983) | 9,144 | ||||
Other comprehensive income (loss), net of tax | 3,773 | 3,853 | 3,853 | (80) | ||||
Common stock issued | 679 | 1,673 | (8,750) | (3,329) | 11,085 | 679 | ||
Stock-based compensation charges | 15,394 | 20,753 | (5,359) | 15,394 | ||||
Purchase of treasury shares | (1,720) | (1,720) | (1,720) | |||||
Retirement of common stock | (42) | (131) | 173 | |||||
Other | (1,680) | (1,628) | (1,628) | (52) | ||||
Ending Balance at Dec. 31, 2015 | 1,546,721 | 246,841 | 1,687,059 | (260,884) | (93,955) | (92,262) | 1,486,799 | 59,922 |
Net income (loss) | 36,299 | 34,117 | 34,117 | 2,182 | ||||
Other comprehensive income (loss), net of tax | 27,013 | 27,060 | 27,060 | (47) | ||||
Common stock issued | 3,305 | (3,305) | ||||||
Stock-based compensation charges | 11,639 | 11,639 | 11,639 | |||||
Purchase of shares from NCI | (17,182) | 597 | 597 | (17,779) | ||||
Purchase of treasury shares | (4,022) | (4,022) | (4,022) | |||||
Retirement of common stock | (456) | (871) | 1,327 | |||||
Distributions to NCI | (5,000) | (5,000) | ||||||
Ending Balance at Dec. 31, 2016 | $ 1,595,468 | $ 249,690 | $ 1,695,119 | $ (226,767) | $ (66,895) | $ (94,957) | $ 1,556,190 | $ 39,278 |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1—BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Nature of Operations McDermott International, Inc. (“MDR”), a corporation incorporated under the laws of the Republic of Panama in 1959, is a leading provider of integrated engineering, procurement, construction and installation (“EPCI”), front-end engineering and design (“FEED”), and module fabrication services for upstream field developments worldwide. We deliver fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for complex offshore and subsea oil and gas projects. Operating in approximately 20 countries across Americas, Europe, Africa, the Middle East, Asia and Australia, our integrated resources include a diversified fleet of marine vessels, fabrication facilities and engineering offices. We support our activities with comprehensive project management and procurement services, while utilizing our fully integrated capabilities in both shallow water and deepwater construction. Our customers include national, major integrated and other oil and gas companies, and we operate in most major offshore oil and gas producing regions throughout the world. We execute our contracts through a variety of methods, principally fixed-price, but also including cost reimbursable, cost-plus, day-rate and unit-rate basis or some combination of those methods. In these Notes to our Consolidated Financial Statements, unless the context otherwise indicates, “we,” “us” and “our” mean MDR and its consolidated subsidiaries. Basis of Presentation We have presented our Consolidated Financial Statements in U.S. Dollars in accordance with accounting principles generally accepted in the United States (“GAAP”). These Consolidated Financial Statements include the accounts of McDermott International, Inc., its consolidated subsidiaries and controlled entities. Subsidiaries are defined as being those companies over which we, either directly or indirectly, have control through a majority of the voting rights or the right to exercise control or to obtain the majority of the benefits and be exposed to the majority of the risks. Subsidiaries are consolidated from the date on which control is obtained until the date that such control ceases. All intercompany transactions and balances have been eliminated in consolidation. Business Segments We report financial results under three reportable segments consisting of (1) Americas, Europe, and Africa (“AEA”), (2) the Middle East (“MEA”) and (3) Asia (“ASA”). We also report certain corporate and other non-operating activities under the heading “Corporate and Other.” Corporate and Other primarily reflects costs that are not allocated to our reportable segments. For financial information about our segments, see Note 19, Segment Reporting. Revenue Recognition Contracts― We determine the appropriate accounting treatment for each of our contracts with customers before work on the project begins. We generally recognize contract revenues and related costs on a percentage-of-completion method for individual contracts or combinations of contracts based on work performed, man hours, or a cost-to-cost method, as applicable to the activity involved. We include the amount of accumulated contract costs and estimated earnings that exceed billings to customers in Contracts in Progress. We include billings to customers that exceed accumulated contract costs and estimated earnings in Advance Billings on Contracts. Most long-term contracts contain provisions for progress payments. We expect to invoice customers for all unbilled revenues. Certain costs are generally excluded from the cost-to-cost method of measuring progress, such as significant costs for materials and third-party subcontractors. On certain projects, we may purchase a significant portion of the materials or incur third-party subcontractor costs, recognized as project costs, either upfront or during other phases of contract execution. Therefore, we believe exclusion of the costs for such materials and subcontractors provides a better measure of actual progress toward completion, particularly in the early stages of contracts, as inclusion of these costs could overstate the progress of projects. We believe that our approach more closely aligns with the actual, physical progress of our contracts. Costs incurred prior to a project award are generally expensed during the period in which they are incurred. Total estimated project costs and resulting contract income are affected by changes in the expected cost of materials and labor, productivity, vessel costs, scheduling and other factors. Additionally, external factors such as weather, customer requirements and other factors outside of our control may affect the progress and estimated cost of a project’s completion and, therefore, the timing and amount of revenue and income recognition. We regularly review contract price and cost estimates as the work progresses and reflect adjustments in profit proportionate to the job percentage of completion during the period in which those estimates are revised. Unapproved Change Orders― Change orders, which are a normal and recurring part of our business, can increase, sometimes substantially, the future scope and cost of a job. Therefore, change order awards, although frequently beneficial in the long term, can have the short-term effect of reducing the job percentage of completion and thus the revenues and profits recognized to date. Revenues and gross profit on contracts can be significantly affected by change orders that may not be approved by the customer until the later stages of a contract or subsequent to the date a project is completed. If it is not probable the costs will be recovered through a change in contract price, the costs attributable to change orders are treated as contract costs without incremental revenue. For certain contracts where it is probable the costs will be recovered through a change order, total estimated contract revenue is increased by the lesser of the amounts management expects to recover and the costs expected to be incurred. Revenue from unapproved change orders is generally recognized to the extent of the lesser of amounts we expect to recover or costs incurred. To the extent claims included in backlog are not resolved in our favor, there could be reductions in, or reversals of previously reported amounts of, revenues and profits, and charges against current earnings, which could be material. Claims Revenue— Claims revenue may relate to various factors, including the procurement of materials, equipment performance failures, change order disputes or schedule disruptions and other delays, including those associated with weather and sea conditions. Claims revenue, when recorded, is only recorded to the extent of the lesser of the amounts management expects to recover and the associated costs incurred. We include certain unapproved claims in the applicable contract values when we have a legal basis to do so, consider collection to be probable and believe we can reliably estimate the ultimate value. Amounts attributable to unapproved change orders are not included in claims. We continue to actively engage in negotiations with our customers on our outstanding claims. However, these claims may be resolved at amounts that differ from our current estimates, which could result in increases or decreases in future estimated contract profits or losses. Claims are generally negotiated over the course of the respective projects, many of which are long-term in nature. Deferred Profit Recognition― For contracts as to which we are unable to estimate the final profitability due to their uncommon nature, including first-of-a-kind projects, we recognize equal amounts of revenue and cost until the final results can be estimated more precisely. For these contracts, we only recognize gross margin when reliably estimable and the level of uncertainty has been significantly reduced, which we generally determine to be when the contract is at least 70% complete. We treat long-term construction contracts that contain such a level of risk and uncertainty that estimation of the final outcome is impractical as deferred profit recognition contracts. If, while being accounted for under our deferred profit recognition policy, a current estimate of total contract costs indicates a loss, the projected loss is recognized in full and the project is accounted for under our normal revenue recognition guidelines. Currently, we are not accounting for any projects under our deferred profit recognition policy. Completed Contract Method― Under the completed contract method, revenue and gross profit is recognized only when a contract is complete or substantially complete. We generally do not enter into fixed-price contracts without an estimate of cost to complete that we believe to be accurate. However, it is possible that in the time between contract award and the commencement of work on a project we could lose the ability to forecast costs to complete adequately based on intervening events, including, but not limited to, experience on similar projects, civil unrest, strikes and volatility in our expected costs. In such a situation, we would use the completed contract method of accounting for that project. In last three years, we did not enter into any contracts that we accounted for under the completed contract method. Loss Recognition― A risk associated with fixed-priced contracts is that revenue from customers may not cover increases in our costs. It is possible that current estimates could materially change for various reasons, including, but not limited to, fluctuations in forecasted labor and vessel productivity, vessel repair requirements, weather downtime, subcontractor or supplier performance, pipeline lay rates or steel and other raw material prices. Increases in costs associated with our fixed-price contracts could have a material adverse impact on our consolidated financial condition, results of operations and cash flows. Alternatively, reductions in overall contract costs at completion could materially improve our consolidated financial condition, results of operations and cash flows. See Note 2, Revenue Recognition . Use of Estimates We use estimates and assumptions to prepare our financial statements in conformity with GAAP. Those estimates and assumptions affect the amounts we report in our Consolidated Financial Statements and accompanying Notes. Our actual results could differ from those estimates, and variances could materially affect our financial condition and results of operations in future periods. Changes in project estimates generally exclude change orders and changes in scope, but may include, without limitation, changes in cost recovery estimates, unexpected changes in weather conditions, changes in productivity, unidentified required vessel repairs, customer and vendor delays and other costs. We generally expect to experience a reasonable amount of unanticipated events, and some of those events can result in significant cost increases above cost amounts we previously estimated. As of December 31, 2016, we have provided for our estimated costs to complete on all of our ongoing contracts. However, it is possible that current estimates could change due to unforeseen events, which could result in adjustments to overall contract costs. Variations from estimated contract performance could result in material adjustments to operating results. For all contracts, if a current estimate of total contract cost indicates a loss, the projected loss is recognized in full when determined. Loss Contingencies We record liabilities for loss contingencies when it is probable that a liability has been incurred and the amount of loss is reasonably estimable. We provide disclosure when there is a reasonable possibility that the ultimate loss will exceed the recorded provision or if such loss is not reasonably estimable. We are currently involved in litigation and other proceedings, as discussed in Note 18, Commitments and Contingencies Stock-Based Compensation Equity instruments are measured at fair value on the grant date. Stock-based compensation expense is generally recognized on a straight-line basis over the requisite service periods of the awards. We use a Black-Scholes model to determine the fair value of certain share-based awards, such as stock options. Additionally, we use a Monte Carlo model to determine the fair value of certain share-based awards that contain market and performance-based conditions. The use of these models requires highly subjective assumptions, such as assumptions about the expected life of the award, vesting probability, expected dividend yield and the volatility of our stock price. See Note 14, Stock-Based Compensation, Cash, Cash Equivalents and Restricted Cash Our cash and cash equivalents are highly liquid investments with maturities of three months or less when we purchase them. We record cash and cash equivalents as restricted when we are unable to freely use such cash and cash equivalents for our general operating purposes. A majority of our restricted cash and cash equivalents serves as collateral for outstanding letters of credit, as further discussed in Note 10, Debt Accounts Receivable Accounts receivable are recorded at the invoiced amount based on contracted prices. Amounts collected on accounts receivable are included in total cash provided by operating activities in the Consolidated Statements of Cash Flows. We establish allowances for doubtful accounts based on our assessments of our customers’ willingness and abilities to pay. In addition to such allowances, there are often items in dispute or being negotiated that may require us to make an estimate as to the ultimate outcome. Past due receivable balances are written off when our internal collection efforts have been unsuccessful in collecting the amounts due. Retainage, included in accounts receivable, represents amounts withheld from billings by our clients pursuant to provisions in the applicable contracts and may not be paid to us until the completion of specific tasks or the completion of the project and, in some instances, for even longer periods. Retainage may also be subject to restrictive conditions, such as performance guarantees. Property, Plant and Equipment We carry our property, plant and equipment at depreciated cost. Except for major marine vessels, we depreciate our property, plant and equipment using the straight-line method, over the estimated economic useful lives of eight to 33 years for buildings and three to 28 years for machinery and equipment. We do not depreciate property, plant and equipment classified as held for sale. We depreciate major marine vessels using the units-of-production method based on the utilization of each vessel. Our units-of-production method of depreciation involves the calculation of depreciation expense on each vessel based on the product of actual utilization for the vessel for the period and the applicable daily depreciation value (which is based on vessel book value, standard utilization and vessel life) for the vessel. Our actual utilization is determined based on the actual days that the vessel was working or otherwise actively engaged (other than in transit between regions) under a contract, as determined by daily vessel operating reports prepared by the crew of the vessel. Our standard utilization is determined by vessel at least annually based on recent actual utilization combined with an expectation of future utilization, both of which allow for idle time. We ensure that a minimum amount of accumulated depreciation of at least 50% of equivalent life-to-date straight-line depreciation is recorded. Additionally, in periods of very low utilization, a minimum amount of depreciation expense of at least 25% of an equivalent straight-line depreciation expense (which is based on an initial 25-year life) is recorded. We capitalize drydocking costs in other current assets and other assets when incurred and amortize the costs over the period of time between two drydock periods, which is generally five years. We expense the costs of other maintenance, repairs and renewals, which do not materially prolong useful life of an asset, as we incur them. Investments in Unconsolidated Affiliates We account for equity investments using the equity method of accounting if we have the ability to exercise significant influence over, but not control of, an investee. Significant influence generally exists if we have an ownership interest representing between 20% and 50% voting rights. Under the equity method of accounting, investments are stated initially at cost and are adjusted for subsequent additional investments and our proportionate share of profit or losses and distributions. We record our share of the profit or losses of the equity method investments, net of income taxes, in the Consolidated Statements of Operations. When our share of losses in an equity investment equals or exceeds our interest in the equity investment, including any other unsecured receivables, we do not recognize further losses, unless we have incurred obligations or made payments on behalf of the equity investment. We evaluate our equity method investments for impairment when events or changes in circumstances indicate, in our management’s judgment, that the carrying value of such investments may have experienced other-than-temporary decline in value. When evidence of loss in value has occurred, we compare the estimated fair value of investment to the carrying value of investment to determine whether an impairment has occurred. If the estimated fair value is less than the carrying value and our management considers the decline in value to be other-than-temporary, the excess of the carrying value over the estimated fair value is recognized in the Consolidated Financial Statements as an impairment. Derivative Financial Instruments Our worldwide operations give rise to exposure to changes in certain market conditions, which may adversely impact our financial performance. When we deem it appropriate, we use derivatives as a risk management tool to mitigate the potential impacts of certain market risks. The primary market risk we manage through the use of derivative instruments is movement in foreign currency exchange rates. We use foreign currency derivative contracts to reduce the impact of changes in foreign currency exchange rates on our operating results. We use these instruments to hedge our exposure associated with revenues, costs (or both) on our long-term contracts and other cash flow exposures that are denominated in currencies other than our operating entities’ functional currencies. We do not hold or issue financial instruments for trading or other speculative purposes. In certain cases, contracts with our customers contain provisions under which some payments from our customers are denominated in U.S. Dollars and other payments are denominated in a foreign currency. In general, the payments denominated in a foreign currency are designed to compensate us for costs that we expect to incur in such foreign currency. In these cases, we may use derivative instruments to reduce the risks associated with foreign currency exchange rate fluctuations arising from differences in timing of our foreign currency cash inflows and outflows. We recognize all derivatives at fair value on the balance sheet. Derivatives that are not accounted for as hedges under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815, Derivatives and Hedging Derivative Financial Instruments The ineffective portion of a derivative’s change in fair value and any portion excluded from the assessment of effectiveness are immediately recognized in earnings. Gains and losses on derivative financial instruments that are immediately recognized in earnings generally are included as a component of gain (loss) on foreign currency—net in our Consolidated Statements of Operations. Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. An established hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: • Level 1—inputs are based on quoted prices for identical instruments traded in active markets. • Level 2—inputs are based on quoted prices for similar instruments in active markets, quoted prices for similar or identical instruments in inactive markets and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets and liabilities. • Level 3—inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar valuation techniques. The carrying amounts that we have reported for financial instruments, including cash and cash equivalents, restricted cash and cash equivalents, accounts receivables and accounts payable approximate their fair values due to the short maturity of those instruments. See Note 13, Fair Value Measurements, Insurance and Self-Insurance Our wholly owned “captive” insurance subsidiary provides coverage for our retentions under employer’s liability, general and products liability, automobile liability and workers’ compensation insurance and, from time to time, builder’s risk and marine hull insurance within certain limits. We may also have business reasons in the future to arrange for our insurance subsidiary to insure other risks which we cannot or do not wish to transfer to outside insurance companies. Premiums charged and reserves related to these insurance programs are based on the facts and circumstances specific to the insurance claims, our past experience with similar claims, loss factors and the performance of the outside insurance market for the type of risk at issue. The actual outcome of insured claims could differ significantly from estimated amounts. We maintain actuarially determined accruals in our consolidated balance sheets to cover self-insurance retentions for the coverages discussed above. These accruals are based on various assumptions developed utilizing historical data to project future losses. Loss estimates in the calculation of these accruals are adjusted as required based upon reported claims, actual claim payments and settlements and claim reserves. These loss estimates and accruals recorded in our financial statements for claims have historically been reasonable. Claims as a result of our operations, if greater in frequency or severity than actuarially predicted, could adversely impact the ability of our captive insurance subsidiary to respond to all claims presented. Concentration of Credit Risk Our principal customers are businesses in the offshore oil and gas industry. This concentration of customers may impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic or other conditions. In addition, we and many of our customers operate worldwide and are therefore exposed to risks associated with the economic and political forces of various countries and geographic areas. We generally do not obtain any collateral for our receivables. See Note 19, Segment Reporting Pension and Postretirement Benefit Plans We have both defined benefit (funded and unfunded) and defined contribution plans. For the defined benefit plans, a projected benefit obligation is calculated annually by independent actuaries using the unit credit method. We recognize actuarial gains and losses on pension and postretirement benefit plans immediately in our operating results. These gains and losses are generally measured annually as of December 31 and accordingly will normally be recorded during the fourth quarter, unless an earlier remeasurement is required. Should actual experience differ from actuarial assumptions, the projected pension benefit obligation and net pension cost and accumulated postretirement benefit obligation and postretirement benefit cost would be affected in future years. Pension costs primarily represent the increase in the actuarial present value of the obligation for pension benefits based on employee service during the year and the interest on this obligation in respect of employee service in previous years, offset by expected return on plan assets. For defined contribution plans, we pay contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The contributions are recognized as employee benefit expense when due. Foreign Currency Translation We translate assets and liabilities of our foreign operations, other than operations in highly inflationary economies, into U.S. Dollars at year-end exchange rates, and we translate income statement items at average exchange rates for the periods presented. We record adjustments resulting from the translation of foreign currency financial statements as a component of other comprehensive income (loss), net of tax. Impairment Review We review our tangible long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If an evaluation is required, the fair value of each applicable asset is compared to its carrying value. Factors that impact our determination of potential impairment include forecasted utilization of equipment and estimates of forecasted cash flows from projects expected to be performed in future periods. Our estimates of cash flow may differ from actual cash flow due to, among other things, economic conditions or changes in operating performance. Any changes in such factors may negatively affect our business segments and result in future asset impairments. Income Taxes We provide for income taxes based on the tax laws and rates in the countries in which we conduct our operations. MDR is a Panamanian corporation that earns all of its income outside of Panama. As a result, we are not subject to income tax in Panama. We operate in various taxing jurisdictions around the world. Each of these jurisdictions has a regime of taxation that varies, not only with respect to nominal rates, but also with respect to the basis on which these rates are applied. These variations, along with changes in our mix of income or loss from these jurisdictions, may contribute to shifts, sometimes significant, in our effective tax rate. We believe that our deferred tax assets recorded as of December 31, 2016 are realizable through carrybacks, future reversals of existing taxable temporary differences and future taxable income. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as the net tax effects of net operating loss carryforwards. We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. If we subsequently determine that we will be able to realize deferred tax assets in the future in excess of our net recorded amount, the resulting adjustment would increase earnings for the period in which such determination was made. We will continue to assess the adequacy of the valuation allowance on a quarterly basis. Any changes to our estimated valuation allowance could be material to our consolidated financial condition and results of operations. See Note 15, Income Taxes Classification Certain prior year amounts have been reclassified for consistency with the current year presentation. Our Consolidated Financial Statements previously reported income and loss from investment in unconsolidated affiliates as components of operating income. In the first quarter of 2016, we concluded that classification of loss from investments in unconsolidated affiliates after provision for income tax better reflected how the operations of our unconsolidated affiliates relate to our business as a whole. In the first quarter of 2017, we implemented certain changes to our financial reporting structure resulting in: • Corporate expenses, certain centrally managed initiatives (such as restructuring charges), impairments, year-end mark-to-market (“MTM”) pension actuarial gains and losses, costs not attributable to a particular reportable , reportable • Research and development (“R&D”) expenses are separately presented in our Consolidated Statements of Operations. Previously R&D expenses were included in Cost of operations. • Gain (loss) on foreign currency, net is included in Other non-operating income (expense), net in our Consolidated Statements of Operations. Previously, Gain (loss) on foreign currency, net was separately presented. • Note 19 includes , under caption “Information about Operations”, a reconciliation of segment operating income (loss) before income taxes to Income (loss) before income taxes in our Consolidated Statements of Operations. Previously reported financial statements have been adjusted to reflect the above changes. Recently Issued and Adopted Accounting Guidance Statement of Cash Flows —In November 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, . This ASU clarifies how entities should present restricted cash and restricted cash equivalents in the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2017. Early adoption is permitted. We adopted this ASU in the fourth quarter of 2016. As a result, our Consolidated Statement of Cash Flows will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents. All comparative periods presented have been revised to reflect this change. See Note 5, for a reconciliation of the totals in Consolidated Statements of Cash Flows and in the Consolidated Balance Sheets. In August 2016, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. Consolidation —In October 2016, the FASB issued ASU 2016-17, . This ASU amends the primary beneficiary assessment under ASC 810, requiring that a single decision maker consider indirect interests held by related parties under common control on a proportionate basis. This ASU is effective for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. We adopted this ASU in the fourth quarter of 2016. Our adoption did not have a material impact on the accompanying Consolidated Financial Statements. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments In February 2015, the FASB issued ASU 2015-02, Consolidation: Amendments to the Consolidation Analysis, The amendments in ASUs 2015-16 and 2015-02 became effective for annual and interim periods beginning after December 15, 2015. Early adoption was permitted. We adopted these ASUs in the first quarter of 2016. Our adoption of these ASUs did not have a material impact on the accompanying Consolidated Financial Statements. Stock Compensation —In March 2016, the FASB issued ASU 2016-09, This ASU simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, earnings per share and classification in the statement of cash flows. We ad |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2016 | |
Revenue Recognition [Abstract] | |
REVENUE RECOGNITION | NOTE 2—REVENUE RECOGNITION Contract Types We execute our contracts using a variety of pricing methods, including fixed-price, unit-basis, cost-plus, or some combination of those methods, with fixed-price being the most prevalent. The percentage of our revenues by contract type for each of the years ended December 31 was as follows: 2016 2015 2014 Fixed-price 92 % 93 % 87 % Unit-basis and other 8 7 13 100 % 100 % 100 % Unapproved Change Orders As of December 31, 2016, total unapproved change orders included in our estimates at completion aggregated approximately $119 million, of which approximately $15 million was included in backlog. As of December 31, 2015, total unapproved change orders included in our estimates at completion aggregated approximately $122 million, of which approximately $21 million was included in backlog. Claims Revenue The amount of revenues included in our estimates at completion (i.e., contract values) associated with such claims was $10 million as of December 31, 2016 and 2015, all in our Middle East segment. These amounts are determined based on various factors, including our analysis of the underlying contractual language and our experience in making and resolving claims. Our unconsolidated joint ventures did not include any material claims revenue in their 2016, 2015 and 2014 financial results. None of the claims included in our estimates at completion at December 31, 2016 were the subject of any litigation proceedings. We continue to actively engage in negotiations with our customers on our outstanding claims. However, these claims may be resolved at amounts that differ from our current estimates, which could result in increases or decreases in future estimated contract profits or losses. Loss Recognition As of December 31, 2016, we have provided for our estimated costs to complete for all of our ongoing contracts. However, it is possible that current estimates could change due to unforeseen events, which could result in adjustments to overall contract costs. Variations from estimated contract performance could result in material adjustments to operating results for any fiscal quarter or year. For all contracts, if a current estimate of total contract cost indicates a loss, the projected loss is recognized in full immediately and reflected in cost of operations in the Consolidated Statements of Operations. For loss projects, it is possible that our estimates of gross profit could increase or decrease based on changes in productivity, actual downtime and the resolution of change orders and claims with the customers. The provision for estimated losses on all active uncompleted projects is a component of "Advance billings on contracts" in our Consolidated Balance Sheets. As of December 31, 2016, KJO Hout, an active EPCI project in our MEA segment, was in an $8 million loss position and is expected to be complete in the second quarter of 2017. As of December 31, 2015, two significant active projects in our AEA segment were in loss positions. PB Litoral, an EPCI project, in Mexico, which was completed in the first quarter of 2016, and the five-year Agile The provision for estimated losses on all active uncompleted projects in our Consolidated Balance Sheets as of December 31, 2016 was not material and was $22 million as of December 31, 2015. |
USE OF ESTIMATES
USE OF ESTIMATES | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
USE OF ESTIMATES | NOTE 3—USE OF ESTIMATES The following is a discussion of our most significant changes in estimates, which impacted 2016, 2015 and 2014 segment operating income. Year ended December 31, 2016 Segment operating income for 2016 was impacted by net favorable changes in cost estimates totaling approximately $91 million. AEA — The segment was positively impacted by net favorable changes in estimates aggregating approximately $38 million, primarily due to: • successful execution and close-out improvements on the PB Litoral, Chevron Jack St Malo, EOG Sercan and Exxon Julia Subsea Tieback projects; and • productivity improvements and associated cost savings related to the DB 50 NO 102 Included in the change was a reversal of a $7 million provision for liquidated damages, due to an agreed additional extension of the PB Litoral project completion date. Those changes were partially offset by net unfavorable changes on multiple projects, none of which were individually material. MEA — The segment was positively impacted by net favorable changes in estimates aggregating approximately $38 million, primarily due to productivity improvements and associated cost savings related to the and the , both associated with Saudi Aramco projects, due to effective execution. Those favorable changes in estimates were partially offset by: • marine equipment downtime due to unfavorable weather conditions on a project in Qatar; and • a change in estimate at completion on the KJO Hout project, in the Neutral Zone, due to changes to our execution plan and increased costs associated with DB 27 ASA― The segment was positively impacted by net favorable changes in estimates aggregating approximately $15 million, primarily driven by: • efficient project execution including productivity improvements on our marine vessels and associated cost savings, and improved fabrication facility utilization; • favorable settlements with our vendors and sub-contractors; and • favorable agreements on outstanding change orders on active and completed projects. Those net favorable changes were partially offset by a $31 million increase in our estimated costs at completion, as of December 31, 2016, on our Ichthys project in Australia. During January 2017, we identified a failure in supplier-provided subsea-pipe connector components previously installed on this project. As a result, we have determined our estimated costs at completion for the project, as a whole, will increase by $34 million, primarily due to: (1) offshore costs attributable to replacement of those failed components; (2) changes to our execution plan; and (3) incremental mobilization costs and costs attributable to inefficiencies of executing work out-of-sequence as a result of the revised execution plan. Due to uncertainties in the estimation process, we believe it is reasonably possible the completion costs could be further revised in the near term by an additional $10 million. Although this project could recognize these additional costs in 2017, we expect the project to remain in an overall profitable position. Year ended December 31, 2015 Segment operating income for 2015 was impacted by net favorable changes in cost estimates totaling approximately $70 million. AEA― The segment had net favorable changes in estimates aggregating approximately $27 million, primarily due to: • the extension of the PB Litoral project completion date, which resulted in a $12 million reversal of liquidated damages; • the Agile • other projects experienced net favorable changes in estimate of $4 million, which individually were not material. MEA― The segment had net favorable changes in estimates aggregating approximately $20 million primarily due to: • two Saudi Aramco projects were positively impacted by an aggregate $24 million related to: (1) productivity improvements and associated cost savings on the Intermac 406 • the KJO Hout project in the Neutral Zone was positively impacted by $9 million due to a favorable discussion with the customer on reimbursement for vessel downtime and cost savings resulting from customer-approved design optimization; Those net favorable changes were partly offset by a $20 million change in estimate to complete on the ADMA 4 GI project in the U.A.E. because of changes in our execution plan, increased costs associated with the DB 32 ASA― The segment had net favorable changes in estimates aggregating approximately $23 million primarily due to: • positive impact of $5 million benefit on the Ichthys project, due to project execution cost savings; • net positive changes in estimates of $4 million on the Gorgon MRU project due to close out improvements; and • net positive changes in estimate of $14 million on other multiple projects, which individually were not material. Year ended December 31, 2014 Segment operating income for 2014 was impacted by changes in estimates relating to projects in each of our segments. AEA ―The segment was negatively impacted by net unfavorable changes in estimates aggregating $37 million associated with the following: • on the PB Litoral project, an EPCI project in Mexico, we increased our estimated cost to complete by approximately $69 million, due to liquidated damages and extended project management costs arising from unexpected project delays and projected fabrication cost increases reflecting reduced productivity, and execution plan changes to mitigate further project delays, as well as procurement and marine installation cost increases; • on the Jack St. Malo subsea project in the Gulf of Mexico, we increased our estimated cost to complete by approximately $6 million, primarily due to equipment downtime issues on the NO 102 • on a fabrication project in Morgan City, the BG Comp Module, completed during 2013, we reduced our cost recovery estimates by approximately $8 million, mainly based on an agreement in principle with the customer in 2014, which resulted in lower-than-anticipated recoveries. Those negative impacts were partially offset by $40 million of project close-out improvements on the Papa Terra EPCI project in Brazil, which resulted from marine cost reductions upon completion of activities and increased recoveries due to successful developments from the ongoing approval process for additional weather-related compensation. We also recognized $5 million of cost reductions on the Gulfstar marine installation project in the Gulf of Mexico, primarily due to project close-out improvements. MEA ―The segment was negatively impacted by net unfavorable changes aggregating about $4 million, primarily attributable to changes on the following: • Safaniya Phase-2, a Saudi Aramco EPCI project, we increased our estimated cost at completion by approximately $23 million, net. Increases of $43 million were primarily a result of vessel downtime due to weather and standby delays, and were partially offset by increased cost recovery estimates of approximately $20 million based on positive discussions with the customer during the fourth quarter of 2014; • Safaniya Phase-1, another Saudi Aramco project, we increased our estimated cost to complete by $19 million, primarily as a result of increased cost estimates to complete the onshore scope. Although the project recognized a loss in 2013, it remains in an overall profitable position and is substantially complete; and • the KJO Ratawi project, we increased our estimated costs to complete by approximately $12 million, to reflect cost overruns related to (1) the onshore work, which was substantially completed in July 2014, and (2) delays in completing the offshore work, due to delayed access to the project site, resulting in a revised execution plan. The revised execution plan included the costs of an incremental mobilization and reflected inefficiencies of executing out-of-sequence work. This project was completed in the third quarter of 2015. These negative changes were partially offset by approximately $54 million due to increased cost recovery estimates on a completed pipelay project in the Caspian based on positive negotiations with the customer in 2014, in connection with the ongoing project close-out process. ASA ―The segment experienced net favorable changes aggregating approximately $52 million, primarily attributable to changes in estimates on following: • changes in estimates on the Siakap subsea development project in Malaysia resulted in an improvement of approximately $34 million in 2014, primarily related to productivity improvements on our marine vessels and offshore support activities, as well as the favorable resolution of cost contingencies relating to offshore performance risks; • the BSP Champion marine installation project in Brunei, a reduction in estimated cost to complete due to productivity improvements on marine vessels and offshore support activities resulted in project savings of approximately $12 million; • the Dai Hung SURF and Macedon projects, insurance claim collection and final project close-out adjustments resulted in an additional recovery of approximately $10 million in 2014; and • completion of Sepat FEED and Esso KTT projects resulted in project close-out savings of approximately $6 million. These positive changes were partially offset by a negative change in estimate of $11 million on the Ichthys project in Australia, primarily due to lower than expected fabrication productivity, increase in procurement costs as well as an increase in marine costs primarily due to changes in marine asset utilization. |
RESTRUCTURING
RESTRUCTURING | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring And Related Activities [Abstract] | |
RESTRUCTURING | NOTE 4—RESTRUCTURING In 2014 we completed a major review of our cost structure, and subsequently implemented a plan, which we referred to as the McDermott Profitability Initiative We continued our efforts to improve our cost structure by initiating the Additional Overhead Reduction During 2013 and 2014, we implemented a restructuring of our Americas operations, which involved our Morgan City, Louisiana, Houston, Texas, New Orleans, Louisiana and some Brazil locations. The restructuring involved, among other things, reductions of management, administrative, fabrication and engineering personnel, and the discontinued utilization of the Morgan City facility. We completed a Corporate restructuring during 2014. Costs associated with our Corporate restructuring activities primarily included severance, relocation and other personnel-related costs and costs for advisors, as well as costs for certain executive management changes that became effective during the fourth quarter of 2013. The above restructuring initiatives are driven and managed by Corporate. Those costs are not allocated to our reportable segments. The following table presents restructuring costs incurred in 2016, 2015, 2014 and from inception, by major cost type. Year ended December 31, Incurred from inception to 2016 2015 2014 December 31, 2016 (In thousands) Americas Restructuring $ (1,350 ) (1 ) $ 2,308 $ 9,170 $ 44,194 Corporate Restructuring - - 4,940 6,601 MPI Severance and other personnel-related costs 2,590 15,217 - 17,807 Asset impairment and disposal - 7,471 - 7,471 Legal and other advisor fees 222 7,414 4,003 11,639 Other 2,436 7,609 - 10,045 Total MPI 5,248 37,711 4,003 46,962 AOR Severance and other personnel-related costs 5,012 - - 5,012 Legal and other advisor fees 1,968 800 - 2,768 Other 385 - - 385 Total AOR 7,365 800 - 8,165 Total $ 11,263 $ 40,819 $ 18,113 $ 105,922 (1) This amount includes reversal of environmental liability established in connection with discontinued utilization of our Morgan City fabrication facility. For further discussion see, Note 18, Commitments and Contingencies . |
CASH, CASH EQUIVALENTS AND REST
CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 12 Months Ended |
Dec. 31, 2016 | |
Cash And Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH | NOTE 5—CASH, CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets that sum to the totals of such amounts shown in the Consolidated Statements of Cash Flows. December 31, 2016 December 31, 2015 (in thousands) Cash and cash equivalents $ 595,921 $ 664,844 Restricted cash and cash equivalents 16,412 116,801 Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows $ 612,333 $ 781,645 A majority of our restricted cash balances as of December 31, 2016 and 2015 serves as collateral for letters of credit, as further discussed in Note 10, Debt |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE | NOTE 6—ACCOUNTS RECEIVABLE Accounts Receivable—Trade, Net A summary of contract receivables is as follows: December 31, 2016 December 31, 2015 (in thousands) Contract receivables: Contracts in progress $ 245,604 164,898 Completed contracts 40,345 35,702 Retainages 58,431 17,896 Unbilled (1) 4,303 4,303 Less allowances (14,299 ) (14,325 ) Accounts receivable—trade, net $ 334,384 $ 208,474 (1) This amount relates to a project milestone billing for which we are awaiting the customer’s final acceptance certificate. We expect to receive the final acceptance certificate during 2017. We expect to invoice our unbilled receivables once certain milestones or other metrics are reached, and we expect to collect all unbilled amounts. We believe that our provision for losses on uncollectible accounts receivable is adequate for our credit loss exposure. The following amounts represent retainages on contracts: December 31, 2016 December 31, 2015 (in thousands) Retainages expected to be collected within one year $ 58,431 $ 17,896 Retainages expected to be collected after one year 127,193 155,061 Total retainages $ 185,624 $ 172,957 We have included in Accounts receivable—trade, net, retainages expected to be collected in 2017. Of the long-term retainages at December 31, 2016, we expect to collect $121 million in 2018 and $6 million in 2019. Accounts Receivable—Other A summary of accounts receivable—other is as follows: December 31, 2016 December 31, 2015 (In thousands) Receivables from unconsolidated affiliates $ 13,292 $ 12,816 Accrued unbilled other 12,075 14,021 Employee receivables 4,730 4,376 Other taxes receivable 2,483 28,743 Other 4,349 6,733 Accounts receivable — $ 36,929 $ 66,689 Employee receivables are expected to be collected within 12 months, and any allowance for doubtful accounts on our Accounts receivable—other is based on our estimate of the amount of probable losses due to the inability to collect these amounts (based on historical collection experience and other available information). As of December 31, 2016 and 2015, no such allowance for doubtful accounts was recorded. |
CONTRACTS IN PROGRESS AND ADVAN
CONTRACTS IN PROGRESS AND ADVANCE BILLINGS ON CONTRACTS | 12 Months Ended |
Dec. 31, 2016 | |
Contractors [Abstract] | |
CONTRACTS IN PROGRESS AND ADVANCE BILLINGS ON CONTRACTS | NOTE 7—CONTRACTS IN PROGRESS AND ADVANCE BILLINGS ON CONTRACTS Components of contracts in progress and advance billings on contracts is as follows: December 31, 2016 December 31, 2015 (In thousands) Costs incurred less costs of revenue recognized $ 119,688 $ 112,819 Revenues recognized less billings to customers 199,450 323,010 Contracts in Progress $ 319,138 $ 435,829 Billings to customers less revenue recognized 42,637 265,618 Costs incurred less costs of revenue recognized 149,849 (100,845 ) Advance Billings on Contracts $ 192,486 $ 164,773 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 8—PROPERTY, PLANT AND EQUIPMENT A summary of property, plant and equipment by asset category is as follows: December 31, 2016 December 31, 2015 (In thousands) Marine Vessels $ 1,789,942 $ 1,391,556 Construction Equipment 474,128 478,175 Buildings 152,584 155,292 All other 148,805 143,580 Construction in Progress 20,720 298,749 Total Cost $ 2,586,179 $ 2,467,352 Accumulated Depreciation (898,878 ) (856,493 ) Net Book Value $ 1,687,301 $ 1,610,859 Interest capitalization― We incurred interest of $75 million, $74 million and $85 million and capitalized $14 million, $23 million and $24 million of interest in 2016, 2015 and 2014, respectively. The capitalized interest primarily related to vessels under construction in the respective periods – the and . Depreciation― Our depreciation expense was approximately $90 million, $100 million and $93 million in 2016, 2015 and 2014, respectively. Asset Sales— During 2014, we completed the sale of the and the for aggregate cash proceeds of approximately $25 million, and realized approximately $11 million of associated gains. In April 2014, we completed the sale of our Harbor Island facility near Corpus Christi, Texas for proceeds of approximately $32 million, and realized an approximate $25 million gain. In June 2014, as part of our plan to discontinue utilization of our Morgan City facility, we disposed of several assets, including various items of equipment, for aggregate cash proceeds of approximately $14 million, resulting in an aggregate gain of approximately $11 million, of which approximately $1 million was recorded in connection with our Americas restructuring, discussed in Note 4, Restructuring Loss (gain) on asset disposals is generally reflected in Corporate and Other. |
EQUITY METHOD INVESTMENTS
EQUITY METHOD INVESTMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Equity Method Investment Summarized Financial Information Equity [Abstract] | |
EQUITY METHOD INVESTMENTS | NOTE 9—EQUITY METHOD INVESTMENTS Our consolidated net income includes our proportionate share of the net income or loss of our equity method investees. We do not have any investments accounted for under the equity method that are considered individually material. None of the equity method investees are listed on a stock exchange. Summarized 100 percent balance sheet information for investments in equity method investees, combined, are set forth below: December 31, 2016 December 31, 2015 (In thousands) Current Assets $ 74,430 $ 133,171 Noncurrent Assets 124,862 189,536 Total Assets $ 199,292 $ 322,707 Current Liabilities $ 91,268 $ 176,165 Noncurrent Liabilities 86,963 112,162 Total Liabilities $ 178,231 $ 288,327 Summarized 100 percent income statement information for investments in equity method investees, combined, are set forth below: Year Ended December 31, 2016 2015 2014 (In thousands) Revenues $ 111,847 $ 107,795 $ 294,408 Cost of operations 87,335 105,465 275,015 Gross Profit 24,512 2,330 19,393 Net Income (loss) $ (8,609 ) $ (38,245 ) $ (28,773 ) Our share of income taxes incurred directly by an equity company is reported in equity in earnings of equity method investee, and as such is not included in income taxes in our Consolidated Financial Statements. During the third quarter of 2016, we exited our investment in THHE Fabricators Sdn. Bhd. and recorded a $12 million decrease in Investments in unconsolidated affiliates and a $5 million gain in Other non-operating income (expense), net in our ASA segment. For further discussion see Note 17, Stockholders’ Equity. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 10—DEBT As of December 31, 2016 and 2015 the carrying values of our long-term debt obligations, net of unamortized debt issuance costs of $14 million and $20 million, respectively, are as follows: December 31, 2016 December 31, 2015 (In thousands) Senior Notes $ 493,461 $ 491,890 Term Loan 212,070 289,979 North Ocean 105 construction financing 31,877 38,263 Amortizing Notes 7,932 21,205 Other, including capital lease obligation 7,180 2,546 752,520 843,883 Less: Amounts due within one year 48,125 24,882 Total long-term debt $ 704,395 $ 819,001 Maturities of long-term debt during the five years subsequent to December 31, 2016 are as follows: (in thousands) 2017 $ 49,820 2018 3,427 2019 212,846 2020 - 2021 500,000 Total Debt $ 766,093 Debt Issuance Costs (13,573 ) Total Debt - Net of Issuance Costs $ 752,520 In April 2014, we entered into a credit agreement (the “Credit Agreement”), which initially provided for a $400 million first-lien, first-out three-year letter of credit facility (the “LC Facility”), scheduled to mature in 2017, and a $300 million first-lien, second-out five-year term loan (the “Term Loan”), scheduled to mature in 2019. The indebtedness and other obligations under the Credit Agreement are unconditionally guaranteed on a senior secured basis by substantially all of our wholly owned subsidiaries, other than our captive insurance subsidiary (collectively, the “Guarantors”). We also completed the issuance of (a) $500 million of second-lien, seven-year, senior secured notes; and (b) $288 million of tangible equity units (“TEUs”) composed of (1) three-year amortizing, senior unsecured notes, in an aggregate principal amount of $48 million, and (2) prepaid common stock purchase contracts. In October 2015, we entered into Amendment No. 1 to the Credit Agreement, which amended the Credit Agreement primarily to increase the existing LC Facility from $400 million to $520 million. In February 2016, we entered into Amendment No. 2 to the Credit Agreement, which amended the Credit Agreement to permit us to add to Covenant EBITDA certain cash restructuring expenses related to the conclusion of MPI or implementation of AOR for the quarters ending on or after March 31, 2016 but before April 16, 2017, in an aggregate amount not to exceed $25 million (as of any date of determination). On April 18, 2016, we entered into Amendment No. 3 to the Credit Agreement, which, among other things: • replaced the existing EBITDA covenant with new ratios (as defined in Amendment No. 3) as follows: • a minimum fixed charge coverage ratio of 1.15x for the fiscal quarter ended March 31, 2016 and each fiscal quarter thereafter; • a maximum total leverage ratio of 4.5x for the fiscal quarter ended March 31, 2016 and each subsequent fiscal quarter through June 30, 2017, 4.0x for the fiscal quarters ending September 30, 2017 and December 31, 2017, and 3.5x for each fiscal quarter thereafter; and • a maximum secured leverage ratio of 2.0x for the fiscal quarter ended March 31, 2016 and each subsequent fiscal quarter through December 31, 2017, and 1.5x for each fiscal quarter thereafter; and • amended the maximum capital expenditure covenant to limit capital expenditures in 2016 and thereafter to $250 million each fiscal year, with any prior fiscal year unused capital expenditures up to $125 million able to be carried forward and added to the next year’s capital expenditure capacity, for a total of $375 million. In addition, upon the May 13, 2016 satisfaction of certain conditions set forth in Amendment 3, including the receipt of requisite consents from term lenders under the Credit Agreement, Amendment 3 also amended the Credit Agreement to, among other things: • extend the maturity date of the LC Facility commitments to April 22, 2019, unless the Term Loan has not been repaid or refinanced by January 15, 2019, in which case the LC Facility commitments will expire on January 15, 2019; • change the existing letter of credit capacity of $520 million to $450 million; • extend the deadline for mortgaging the DLV 2000 DLV 2000 • increase the basket for purchase money indebtedness from $20 million to $150 million; • modify the covenant limiting acquisitions to permit up to $150 million of acquisitions; and • modify the covenant limiting the prepayment or purchase of junior priority debt to permit up to $100 million of such prepayments or purchases. On May 12, 2016, we entered into Amendment No. 4 to the Credit Agreement which, among other things: • increased the applicable margin payable on the Term Loan by 3.0% per annum; and • required that the net cash proceeds of any sale (including a sale and leaseback) of the DLV 2000 On May 13, 2016, McDermott prepaid $75 million of the Term Loan and satisfied the other conditions to the “effective date” set forth in Amendment No. 4. As of December 31, 2016 we were in compliance with the financial covenants set forth in the Credit Agreement. LC Facility As of The LC Facility permits us to deposit up to $300 million with letter of credit issuers to cash collateralize letters of credit issued on a bilateral basis outside the credit facility. As of December 31, 2016, we had bilateral arrangements to issue cash collateralized letters of credit of $175 million. As of December 31, 2016 and 2015, we had an aggregate face amount of approximately $16 million and $102 million of such letters of credit outstanding supported by cash collateral. We have included the supporting cash collateral in restricted cash and cash equivalents in the accompanying Consolidated Balance Sheets. The LC Facility is secured on a first-lien, first-out basis (with relative priority over the Term Loan) by pledges of the capital stock of all the Guarantors and mortgages on, or other security interests in, substantially all the tangible and intangible assets of our company and the Guarantors, subject to specific exceptions. The LC Facility contains various customary affirmative covenants, as well as specific affirmative covenants, including specific reporting requirements and a requirement for ongoing periodic financial reviews by a financial advisor. The LC Facility also requires compliance with various negative covenants, including limitations with respect to the incurrence of other indebtedness and liens, restrictions on acquisitions, capital expenditures and other investments, restrictions on sale leaseback transactions and restrictions on prepayments of other indebtedness. The LC Facility provides for a commitment fee of 0.50% per year on the unused portion of the LC Facility and letter of credit fees at an annual rate of 2.25% for performance letters of credit and 4.50% for financial letters of credit, as well as customary issuance fees and other fees and expenses. Term Loan The Term Loan bears interest at a floating rate, which can be, at our option, either: (1) a LIBOR rate for a specified interest period (subject to a LIBOR “floor” of 1.00%) plus an applicable margin of 7.25%; or (2) an alternate base rate (subject to a base rate “floor” of 2.00%) plus an applicable margin of 6.25%. The Term Loan was incurred with 25 basis points of original issue discount. The Term Loan is secured on a first-lien, second-out basis (with the LC Facility having relative priority over the Term Loan) by pledges of the capital stock of all the Guarantors and mortgages on, or other security interests in, substantially all tangible and intangible assets of our company and the Guarantors, subject to specific exceptions. The Term Loan requires mandatory prepayments from: (1) the proceeds from the sale of assets, as well as insurance proceeds, in each case subject to certain exceptions, to the extent such proceeds are not reinvested in our business within 365 days of receipt; (2) net cash proceeds from the incurrence of indebtedness not otherwise permitted under the Credit Agreement; and (3) 50% of amounts deemed to be “excess cash flow,” subject to specified adjustments. The Term Loan requires $750,000 quarterly payments of principal. The Term Loan requires compliance with various customary affirmative and negative covenants. We are required to maintain a ratio of “ownership adjusted fair market value” of marine vessels to the sum of (1) the outstanding principal amount of the Term Loan and (2) the aggregate principal amount of unreimbursed drawings and advances under the LC Facility of at least 1.75:1.00. As of December 31, 2016, the actual ratio was 6.4 to 1.0. As of December 31, 2016, we were in compliance with all of the covenants under the Term Loan. Under the terms of the Credit Agreement we are restricted in our ability to pay junior priority indebtness, which would include dividends to MDR stockholders, to $50 million prior to April 16, 2017 and $150 million after April 16, 2017. Senior Notes In April 2014 we issued $500 million in aggregate principal amount of 8.00% senior secured notes due 2021 (the “Notes”) in a private placement in accordance with Rule 144A and Regulation S under the Securities Act of 1933, as amended. Interest on the Notes is payable semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2014. The Notes are scheduled to mature on May 1, 2021. The Notes are unconditionally guaranteed on a senior secured basis by the Guarantors, and the Notes are secured on a second-lien basis by pledges of capital stock of certain of our subsidiaries and mortgages and other security interests covering (1) specified marine vessels owned by certain of the Guarantors and (2) substantially all the other tangible and intangible assets of our company and the Guarantors, subject to exceptions for certain assets. At any time, or from time to time, on or after May 1, 2017, at our option, we may redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount of the Notes to be redeemed) Year Percentage 2017 104 % 2018 102 2019 and thereafter 100 The indenture governing the Notes contains covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: (1) incur or guarantee additional indebtedness or issue preferred stock; (2) make investments or certain other restricted payments; (3) pay dividends or distributions on capital stock or purchase or redeem subordinated indebtedness; (4) sell assets; (5) create restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us; (6) create certain liens; (7) sell all or substantially all of our assets or merge or consolidate with or into other companies; (8) enter into transactions with affiliates; and (9) create unrestricted subsidiaries. Many of those covenants would become suspended if the Notes were to attain an investment grade rating from both Moody’s Investors Service, Inc. and Standard and Poor’s Ratings Services and no default has occurred. Tangible Equity Units (“TEUs”) In April 2014, we issued 11,500,000 6.25% TEUs, each with a stated amount of $25. Each TEU consists of (1) a prepaid common stock purchase contract and (2) a senior amortizing note due April 1, 2017 (each an “Amortizing Note”) that has an initial principal amount of $4.1266 per Amortizing Note and bears interest at a rate of 7.75% per annum and has a final scheduled installment payment date of April 1, 2017. The prepaid common stock purchase contracts were accounted for as additional paid-in capital totaling $240 million. As of December 31, 2016, the outstanding principal balance of the Amortizing Notes was $9 million, all of which was classified as current notes payable. Each prepaid common stock purchase contract will automatically settle on April 1, 2017, unless settled earlier: (1) at the holder’s option, upon which we will deliver shares of our common stock, based on the applicable settlement rate and applicable market value of our stock as determined under the purchase contract; or (2) at our option, upon which we will deliver shares of our common stock, based upon the stated maximum settlement rate of 3.5562 shares per Unit, subject to adjustment. Potential dilutive common shares that may be issued for the settlement of the common stock purchase contracts, based on the maximum number of shares issuable per Unit is 40.9 million (i.e., conversion at $7.03 per share). The potential minimum number of shares issuable is 33.4 million (i.e., conversion at $8.61 per share), which represents 2.9030 per Unit. The maximum and minimum settlement rates for the Units are subject to adjustment for certain dilutive events. North Ocean Financing NO 105 ―On September 30, 2010, MDR, as guarantor, and North Ocean 105 AS, in which we have a 75% ownership interest, as borrower, entered into a financing agreement to finance a portion of the construction costs of the Borrowings under the agreement are secured by, among other things, a pledge of all of the equity of North Ocean 105 AS, a mortgage on the , and a lien on substantially all of the other assets of North Ocean 105 AS. MDR unconditionally guaranteed all amounts to be borrowed under the agreement. Under the Credit Agreement, we are required to exercise our option under the North Ocean 105 AS joint venture agreement to purchase Oceanteam ASA’s 25% ownership interest in the vessel-owning company and repay the outstanding debt by April 2017. During 2016, North Ocean 105 AS converted the $5 million dividend declared for the year ended December 31, 2015 in favor of Oceanteam ASA into a $5 million note payable. The note, which is expected to mature in June 2017, bears interest at 4% per annum. Bank Guarantees and Bilateral Letter of Credit MDR has uncommitted lines of credit in place with Middle Eastern banks in support of our contracting activities in the Middle East. Bank guarantees issued under these agreements totaled $359 million and $118 million, as of December 31, 2016 and 2015, respectively. Overall capacity under these arrangements totaled $375 million and $200 million as of December 31, 2016 and 2015, respectively. During January 2017, we received an increase of $150 million in capacity under our agreements and now have an overall capacity of $525 million. Surety Bonds As of December 31, 2016 and 2015, surety bonds issued under general agreements of indemnity in favor of surety underwriters in support of contracting activities of our subsidiaries J. Ray McDermott de México, S.A. de C.V. and McDermott, Inc. totaled $79 million and $54 million, respectively. |
PENSION AND POSTRETIREMENT BENE
PENSION AND POSTRETIREMENT BENEFITS | 12 Months Ended |
Dec. 31, 2016 | |
Compensation And Retirement Disclosure [Abstract] | |
PENSION AND POSTRETIREMENT BENEFITS | NOTE 11—PENSION AND POSTRETIREMENT BENEFITS Although we currently provide retirement benefits for most of our U.S. employees through sponsorship of the McDermott Thrift Plan (see “Defined Contribution Plans” below), some of our longer-term U.S. employees and former employees are entitled to retirement benefits under the McDermott (U.S.) Retirement Plan, a non-contributory qualified defined benefit pension plan (the “McDermott Plan”), and several non-qualified supplemental defined benefit pension plans. The McDermott Plan and the non-qualified supplemental defined benefit pension plans are collectively referred to herein as the “Domestic Plans.” The McDermott Plan has been closed to new participants since 2006, and benefit accruals under the McDermott Plan were frozen completely in 2010. We also sponsor a defined benefit pension plan established under the laws of the Commonwealth of the Bahamas, the J. Ray McDermott, S.A. Third Country National Employees Pension Plan (the “TCN Plan”) which provides retirement benefits for certain of our current and former foreign employees. Effective August 1, 2011, new entry into the TCN Plan was closed, and effective December 31, 2011, benefit accruals under the TCN Plan were frozen. Effective January 1, 2012, we established a new global defined contribution plan to provide retirement benefits to non-U.S. expatriate employees who may have otherwise obtained benefits under the TCN Plan. Retirement benefits under the McDermott Plan and the TCN Plan are generally based on final average compensation and years of service, subject to the applicable freeze in benefit accruals under the plans. Our funding policy is to fund the plans as recommended by the respective plan actuaries and in accordance with the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or other applicable law. The Pension Protection Act of 2006 (“PPA”) amended ERISA and modified the funding requirements for certain defined benefit pension plans including the McDermott Plan. We are in compliance with provisions under the PPA accelerated funding requirements. Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2016 2015 (In thousands) Change in benefit obligation: Benefit obligation at beginning of year $ 519,199 $ 556,632 $ 38,265 $ 43,985 Interest cost 21,102 21,613 1,351 1,626 Actuarial loss (gain) 2,641 (21,754 ) (3,172 ) (4,095 ) Benefits paid (37,586 ) (37,292 ) (5,227 ) (3,251 ) Benefit obligation at end of year 505,356 519,199 31,217 38,265 Change in plan assets: Fair value of plan assets at beginning of year 494,146 551,821 38,257 42,106 Actual return on plan assets 26,891 (21,889 ) (778 ) (598 ) Company contributions 1,510 1,506 - - Benefits paid (37,586 ) (37,292 ) (5,227 ) (3,251 ) Fair value of plan assets at end of year 484,961 494,146 32,252 38,257 Funded status $ (20,395 ) $ (25,053 ) $ 1,035 $ (8 ) Amounts recognized in balance sheet consist of: Other Assets $ - $ - $ 1,035 $ - Accrued pension liability—current (1,382 ) (1,409 ) - - Pension liability (19,013 ) (23,644 ) - (8 ) Accrued benefit liability (20,395 ) (25,053 ) - (8 ) Net (Liability) Asset $ (20,395 ) $ (25,053 ) $ 1,035 $ (8 ) Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2016 2015 (In thousands) Supplemental information: Plans with accumulated benefit obligation in excess of plan assets Projected benefit obligation $ 505,356 $ 519,199 $ 31,217 $ 38,265 Accumulated benefit obligation 505,356 519,199 31,217 38,265 Fair value of plan assets 484,961 494,146 32,252 38,257 Assumptions Domestic Plans TCN Plan 2016 2015 2016 2015 Weighted average assumptions used to determine net periodic benefit obligations at December 31: Discount rate 4.1 % 4.2 % 4.1 % 4.0 % Rate of compensation increase N/A N/A N/A N/A Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2014 2016 2015 2014 (In thousands) Supplemental information: Components of periodic benefit cost: Interest cost $ 21,102 $ 21,613 $ 26,972 $ 1,351 $ 1,626 $ 1,900 Expected return on plan assets (20,006 ) (26,707 ) (27,501 ) (1,587 ) (2,840 ) (2,961 ) Actuarial loss (gain) (4,244 ) 26,842 (8,728 ) (807 ) (657 ) 6,027 Net periodic benefit cost (gain) $ (3,148 ) $ 21,748 $ (9,257 ) $ (1,043 ) $ (1,871 ) $ 4,966 Weighted average assumptions used to determine net periodic benefit cost: Discount rate 4.2 % 4.0 % 4.8 % 4.0 % 4.0 % 4.8 % Expected return on plan assets 4.2 % 5.0 % 5.0 % 4.7 % 6.9 % 6.9 % Rate of compensation increase N/A N/A N/A N/A N/A N/A Expected Long-Term Rate of Return — Our long-term rates of return reflect the average rate of earnings expected on the funds invested, or to be invested, to provide for the benefits included in the projected benefit obligations. In setting the long-term assumed rate of return, we consider capital markets future expectations and the asset mix of the plans’ investments. Actual long-term return can, in relatively stable markets, also serve as a factor in determining future expectations. We consider many factors that include, but are not limited to, historical returns on plan assets, current market information on long-term returns (e.g., long-term bond rates) and current and target asset allocations between asset categories. The target asset allocation is determined based on consultations with external investment advisers. However, any differences in the rate and actual returns will be included with the actuarial gain or loss recorded in the fourth quarter when our plans are remeasured. Investment Goals General The investment goals of the McDermott Trust and the trust underlying the TCN Plan (“TCN Trust”) are generally to provide for the solvency of the respective plans and fulfillment of pension obligations over time, and to maximize long-term investment return consistent with a reasonable level of risk. Asset allocations within the McDermott Trust and TCN Trust are reviewed periodically and rebalanced, if appropriate, to ensure the continued conformance to the investment goals, objectives and strategies. Both the McDermott Trust and the TCN Trust employ a professional investment advisor and a number of professional investment managers whose individual benchmarks are, in the aggregate, consistent with the applicable trust’s overall investment objectives. The specific goals of each investment manager are set out in the investment policy adopted by the investment committee for the respective trust, but, in general, the goals are (1) to perform in line with (in the case of passive accounts) or outperform (for actively managed accounts) the benchmark selected and agreed upon by the manager and the trust, and (2) to display an overall level of risk in its portfolio that is consistent with the risk associated with the agreed upon benchmark. The estimated allocations discussed below are periodically reviewed to assess the appropriateness of the particular funds in which they are invested, and these estimated allocations are subject to change. The performance of each investment manager’s portfolio is periodically measured against commonly accepted benchmarks, including the individual investment manager’s benchmarks. In evaluating investment manager performance, consideration is also given to personnel, strategy, research capabilities, organizational and business matters, adherence to discipline and other qualitative factors that may impact the ability to achieve desired investment results. The following is a summary of the asset allocations at December 31, 2016 and 2015 by asset category. Domestic Plans TCN Plan 2016 2015 2016 2015 Asset Category: Fixed Income 85 % 85 % 67 % 49 % Equity Securities 15 15 33 51 Total 100 % 100 % 100 % 100 % As of December 31, 2015, $14 million of TCN plan assets were held in cash and cash equivalents. Fair Value The following is a summary of total investments for our plans, measured at fair value at: December 31, 2016 Level 1 Level 2 Level 3 Total Pension Benefits: (In thousands) Fixed Income $ 167,271 $ 247,882 $ 5,087 $ 420,240 Equities 82,442 - - 82,442 Cash and Accrued Items 14,531 - - 14,531 Total Investments $ 264,244 $ 247,882 $ 5,087 $ 517,213 December 31, 2015 Level 1 Level 2 Level 3 Total Pension Benefits: (In thousands) Fixed Income $ 60,128 $ 356,107 $ 5,752 $ 421,987 Equities 85,065 12 - 85,077 Cash and Accrued Items 25,335 4 - 25,339 Total Investments $ 170,528 $ 356,123 $ 5,752 $ 532,403 Changes in Level 3 Instrument The following is a summary of the changes in our Level 3 fixed income instruments measured on a recurring basis: December 31, 2016 2015 (In thousands) Balance at beginning of period $ 5,752 $ 5,013 Purchases, net 107 1,269 Total unrealized loss (772 ) (530 ) Balance at end of period $ 5,087 $ 5,752 Cash Flows Domestic Plans TCN Plan (In thousands) Expected employer contributions to trusts of defined benefit plans: 2017 $ - $ - Expected benefit payments: 2017 $ 37,148 $ 5,803 2018 36,929 1,304 2019 36,620 1,571 2020 36,228 1,799 2021 35,876 1,483 2022-2026 169,531 9,309 Defined Contribution Plans Most of our employees in the U.S., through the McDermott Thrift Plan (the “Thrift Plan”), and certain non-U.S. employees, through the McDermott Global Defined Contribution Plan (the “Global Thrift Plan”), are eligible to participate in qualified defined contribution plans by contributing portions of their compensation. For the Thrift Plan, we make employer matching contributions of 50% of participants’ contributions up to 6% of compensation and unmatched employer cash contributions equal to 3% of participants’ base pay, plus overtime pay, expatriate pay and commissions. For the Global Thrift Plan, we make employer matching contributions of 50% of participants’ contributions up to 6% of base salary and unmatched employer cash contributions equal to 3% of participants’ base salary. The following table summarizes our contributions under the plans: Thrift Plan Global Thrift Plan Year Ended December 31, Year Ended December 31, 2016 2015 2014 2016 2015 2014 (In thousands) Contributions $ 4,176 $ 3,840 $ 3,879 $ 998 $ 1,095 $ 1,236 We also provide benefits under the McDermott International, Inc. Director and Executive Deferred Compensation Plan (“Deferred Compensation Plan”), which is a non-qualified defined contribution plan. Expense associated with the Deferred Compensation Plan was not material to our Consolidated Financial Statements. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | NOTE 12—DERIVATIVE FINANCIAL INSTRUMENTS We enter into derivative financial instruments primarily to hedge certain firm purchase or sale commitments and forecasted transactions denominated in foreign currencies. We record these contracts at fair value on our Consolidated Balance Sheets. Depending on the hedge designation at the inception of the contract, the related gains and losses on these contracts are either: (1) deferred as a component of AOCI until the hedged item is recognized in earnings; (2) offset against the change in fair value of the hedged firm commitment through earnings; or (3) recognized immediately in earnings. At inception and on an ongoing basis, we assess the hedging relationship to determine its effectiveness in offsetting changes in cash flows or fair value attributable to the hedged risk. We exclude from our assessment of effectiveness the portion of the fair value of the forward contracts attributable to the difference between spot exchange rates and forward exchange rates. The ineffective portion of a derivative’s change in fair value and any portion excluded from the assessment of effectiveness are immediately recognized in earnings. Gains and losses on derivative financial instruments that are immediately recognized in earnings are included as a component of gain (loss) on foreign currency—net in our Consolidated Statements of Operations. As of December 31, 2016, we designated the majority of our foreign currency forward contracts as cash flow hedging instruments. As of December 31, 2016, we deferred approximately $25 million of net losses on these derivative financial instruments in AOCI, and we expect to reclassify approximately $11 million of the net deferred losses out of AOCI by December 31, 2017. As of December 31, 2016, the majority of our derivative financial instruments consisted of foreign currency forward contracts. The notional value of our outstanding derivative contracts totaled $332 million at December 31, 2016, with maturities extending through May 2018. Of this amount, approximately $158 million is associated with various foreign currency expenditures we expect to incur on one of our EPCI projects in the ASA segment. These instruments consist of contracts to purchase or sell foreign-denominated currencies. As of December 31, 2016, the fair value of these contracts was in a net liability position totaling approximately $7 million. The fair value of outstanding derivative instruments is determined using observable financial market inputs, such as quoted market prices, and is classified as Level 2 in nature. The following table summarizes our asset and liability derivative financial instruments: December 31, 2016 2015 (In thousands) Derivatives Designated as Hedges: Location: Accounts receivable-other $ 2,631 $ 1,668 Other assets - 215 Total derivatives asset $ 2,631 $ 1,883 Accrued liabilities $ 9,361 $ 26,649 Other liabilities 4 4,018 Total derivatives liability $ 9,365 $ 30,667 The following table summarizes the effects of derivative instruments on our Consolidated Financial Statements: December 31, 2016 2015 2014 (in thousands) Derivatives Designated as Hedges: Amount of gain (loss) recognized in other comprehensive income (loss) $ 4,004 $ (57,459 ) $ (65,503 ) Reclassified from AOCI to Cost of operations 34,556 76,034 26,418 Ineffective portion and amount excluded from effectiveness testing gain (loss) recognized in Gain (loss) on foreign currency, net (1,461 ) 6,238 6,910 Credit Risk In the event of nonperformance by counterparties to our derivative financial instruments, we may be exposed to credit-related losses. However, when possible, we enter into International Swaps and Derivative Association agreements with our derivative counterparties to mitigate this risk. We also attempt to mitigate this risk by using highly-rated major financial institutions as counterparties. Our derivative counterparties have the benefit of the same collateral arrangements and covenants as described under our Credit Agreement. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 13—FAIR VALUE MEASUREMENTS The following table presents the financial instruments outstanding as of December 31, 2016 and 2015 that are measured at fair value on recurring basis and financial instruments that are not measured at fair value on a recurring basis. December 31, 2016 Carrying Amount Fair Value Level 1 Level 2 Level 3 (In thousands) Recurring Forward contracts $ (6,734 ) (6,734 ) $ - $ (6,734 ) $ - Non-recurring Debt (752,520 ) (777,072 ) - (728,072 ) (49,000 ) December 31, 2015 Carrying Amount Fair Value Level 1 Level 2 Level 3 (In thousands) Recurring Forward contracts $ (28,784 ) $ (28,784 ) $ - $ (28,784 ) $ - Non-recurring Debt (843,883 ) (777,634 ) - (707,492 ) (70,142 ) The carrying value of all non-derivative financial instruments included in current assets (including cash, cash equivalents and restricted cash, accounts receivable) and current liabilities, including accounts payable but excluding short-term debt approximates the applicable fair value due to the short maturity of those instruments. See Note 1, Basis of Presentation and Significant Accounting Policies—Impairment Review We used the following methods and assumptions in estimating our fair value disclosures for our other financial instruments: Short-term and long-term debt. The fair value of debt instruments valued using a market approach based on quoted prices for similar instruments traded in active markets is classified as Level 2 within the fair value hierarchy. Quoted prices are not available for Amortizing Notes and NO 105 Forward contracts . The fair value of forward contracts is classified as Level 2 within the fair value hierarchy and is valued using observable market parameters for similar instruments traded in active markets. Where quoted prices are not available, the income approach is used to value forward contracts, which discounts future cash flows based on current market expectations and credit risk. Fair Value Disclosure of Non-financial Instruments During the fourth quarter of 2016, we impaired the Intermac 600, During the third quarter of 2016, our management reevaluated our operational plans for certain underutilized marine assets. As a result of that exercise, we identified certain marine assets that would not be used in a manner consistent with management’s original intent. Based on this determination, we tested the carrying value of those assets for recoverability by comparing the undiscounted future cash flows to the assets’ respective carrying values. As the carrying value of those assets exceeded the undiscounted future cash flows, an impairment was recorded. The impairment was calculated as the difference between the $22 million carrying value of the assets and the $10 million estimated fair value of the assets, resulting in a $12 million non-cash impairment charge. We utilized both a market approach and income approach to estimate the fair value of the assets. Inputs included market sales data for comparable assets, forecasted cash flows and discount rates believed to be consistent with those used by principal market participants. The fair value measurement is based on inputs that are not observable in the market and thus represent level 3 inputs. During the first quarter of 2016, we impaired our Agile Property, Plant and Equipment In accordance with ASC 360-10, Property, Plant and Equipment DB101 In the second quarter of 2015, we abandoned a marine pipelay welding system project and recognized a $7 million non-cash impairment charge, which equaled the carrying value of that asset. In June 2014, we cancelled a pipelay system originally intended for the CSV 108, During 2014, we determined that certain of our intangible assets were fully impaired and, in 2014, we recorded an associated impairment charge of approximately $2 million. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 14—STOCK-BASED COMPENSATION Equity instruments are measured at fair value on the grant date. Stock-based compensation expense is generally recognized on a straight-line basis over the requisite service periods of the awards. Compensation expense is based on awards we expect to ultimately vest. Therefore, we have reduced compensation expense for estimated forfeitures based on our historical forfeiture rates. Our estimate of forfeitures is determined at the grant date and is revised if our actual forfeiture rate is materially different from our estimate. Total compensation expense recognized is as follows: 2016 2015 2014 (In thousands) Restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) $ 15,746 $ 14,395 $ 14,417 Performance shares and performance units 6,888 1,428 352 Stock options 46 770 1,747 Total $ 22,680 $ 16,593 $ 16,516 The components of the total gross unrecognized estimated compensation expense for equity awards and their expected remaining weighted-average periods for expense recognition are as follows: Amount (In thousands) Weighted-Average Period (years) RSUs and RSAs $ 17,603 1.8 Performance shares and performance units (1) 258 0.3 $ 17,861 (1) Stock Plans 2016 McDermott International, Inc. Long-Term Incentive Plan In April 2016, our stockholders approved the 2016 McDermott International, Inc. Long-Term Incentive Plan 2014 McDermott International, Inc. Long-Term Incentive Plan In May 2014, our stockholders approved the 2014 McDermott International, Inc. Long-Term Incentive Plan 2009 McDermott International, Inc. Long-Term Incentive Plan 2009 McDermott International, Inc. Long-Term Incentive Plan We no longer issue awards under the 2009 LTIP. Members of the Board of Directors, executive officers and key employees were eligible to participate in the 2009 LTIP. The Compensation Committee of our Board of Directors selected the participants for the 2009 LTIP. The 2009 LTIP provided for a number of forms of stock-based compensation, including incentive and non-qualified stock options, restricted stock, restricted stock units and performance shares and performance units, subject to satisfaction of specific performance goals. Shares approved under the 2001 Directors and Officers Long-Term Incentive Plan MDR’s equity award agreements under the 2016, 2014 and 2009 LTIPs provide that amounts that the Company is required to withhold on behalf of participants for federal or state income taxes upon the vesting of restricted stock units, performance shares or performance units will be satisfied by withholding shares of MDR common stock having an aggregate fair market value equal to but not exceeding the amount of such required tax withholding. Such transactions under the 2016, 2014 and 2009 LTIP are accounted for as purchases of the shares by the Company, and are included in the ordinary shares roll-forward in Note 17, Stockholders’ Equity Stock Options There were no stock options granted in 2016, 2015 or 2014. The following table summarizes stock options activity during 2016 (share data in thousands): Number of Option Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Outstanding at beginning of period 2,896 $ 12.76 Cancelled/expired/forfeited (721 ) 8.65 Outstanding at end of period (1) 2,175 $ 14.13 1.94 years (1) There were no stock options exercised during 2016. The total intrinsic value of stock options exercised during 2015 and 2014 was $0.3 million and $0.9 million, respectively. The intrinsic value is calculated as the total number of option shares multiplied by the excess of the closing price of our common stock on the last trading day over the exercise price of the options. This amount changes based on the fair market value of our common stock. Had all option holders exercised their options on December 31, 2016, the aggregate intrinsic value of the options would have been negative, as their exercise price is higher than closing price of our common stock on December 31, 2016. The total estimated fair value of shares vested during 2016, 2015 and 2014 was $1 million, $3 million and $4 million, respectively. RSUs and RSAs RSUs and RSAs and changes during 2016 were as follows (share data in thousands): Number of Shares Weighted-Average Grant Date Fair Value Nonvested at beginning of period 6,689 $ 5.15 Granted 3,876 3.28 Vested (3,524 ) 5.78 Cancelled/forfeited (868 ) 3.86 Nonvested at end of period 6,173 $ 3.80 There were no tax benefits realized related to RSUs and RSAs that lapsed or vested during 2016, 2015 and 2014. Performance Shares Nonvested performance share awards and changes during 2016 were as follows (share data in thousands): Number of Shares Weighted-Average Grant Date Fair Value Nonvested at beginning of period 2,590 $ 6.71 Granted 1,582 3.22 Cancelled/forfeited (711 ) 10.22 Nonvested at end of period 3,461 $ 4.39 In February 2016 and March 2015, we issued performance unit awards totaling 1,553,134 and 1,774,770 shares, respectively, which were classified as liability awards. Compensation cost for liability awards is re-measured at each reporting period and is recognized as expense over the applicable service period. The remaining weighted-average vesting period for these performance units is 1.8 years. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 15—INCOME TAXES The provision for income taxes consisted of: Year Ended December 31, 2016 2015 2014 (In thousands) Other than U.S.: Current $ 43,944 $ 45,752 $ 21,619 Deferred (2,018 ) 6,211 (1,546 ) Total provision for income taxes $ 41,926 $ 51,963 $ 20,073 The geographic sources of income before income taxes are as follows: Year Ended December 31, 2016 2015 2014 (In thousands) U.S. (124,154 ) (99,738 ) (35,782 ) Other than U.S. 206,469 164,348 (1,691 ) Income before provision for income taxes $ 82,315 $ 64,610 $ (37,473 ) The following is a reconciliation of the Panama statutory federal tax rate to the consolidated effective tax rate: Year Ended December 31, 2016 2015 2014 Panama federal statutory rate 25 % 25 % 25 % Non-Panama operations (14 ) 29 9 Valuation allowance for deferred tax assets 24 10 (105 ) Audit settlements and reserves 14 9 17 Other (primarily tax on unremitted earnings) 2 7 - Effective tax rate attributable to continuing operations 51 % 80 % (54 )% Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes, as well as operating loss and tax credit carryforwards. Significant components of deferred tax assets and liabilities were as follows: December 31, 2016 2015 (In thousands) Deferred tax assets: Pension liability $ 9,732 $ 12,033 Accrued liabilities for incentive compensation 22,208 21,640 Net operating loss carryforward 349,916 325,636 State net operating loss carryforward 18,308 24,367 Long-term contracts - 4,312 Other 1,861 2,060 Total deferred tax assets 402,025 390,048 Valuation allowance for deferred tax assets (334,991 ) (336,146 ) Deferred tax assets $ 67,034 $ 53,902 Deferred tax liabilities: Property, plant and equipment 37,883 34,419 Prepaid drydock 1,367 7,639 Long-term contracts 10,989 - Investments in joint ventures and affiliated companies 17,044 14,960 Unrealized exchange gains and other 3,335 3,163 Total deferred tax liabilities $ 70,618 $ 60,181 Net deferred tax liability $ (3,584 ) $ (6,279 ) December 31, 2016 2015 (In thousands) Deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets include: Deferred tax assets $ 21,116 $ 18,822 Deferred tax liabilities 24,700 25,101 Net deferred tax liability $ (3,584 ) $ (6,279 ) At December 31, 2016, we had a valuation allowance of $335 million for deferred tax assets that we expect cannot be realized through carrybacks, future reversals of existing taxable temporary differences or based on our estimate of future taxable income. We believe that our remaining deferred tax assets will more likely than not be realized through carrybacks, future reversals of existing taxable temporary differences and future taxable income. Any changes to our estimated valuation allowance could be material to our Consolidated Financial Statements. We have foreign net operating loss carryforwards of $373 million available to offset future taxable income in foreign jurisdictions. Of the foreign net operating loss carryforwards, $22 million is scheduled to expire in years 2017 to 2019. The foreign net operating losses have a valuation allowance of $76 million against the related deferred taxes. We have U.S. federal net operating loss carryforwards of approximately $745 million, which includes $17 million for which the benefit will be recorded in APIC when realized, and carry a $261 million valuation allowance against the related deferred taxes. The U.S. federal net operating loss carryforwards are scheduled to expire in years 2030 to 2036. We have state net operating losses of $355 million available to offset future taxable income in states where we operate. The state net operating loss carryforwards are scheduled to expire in years 2017 to 2030. We are carrying a valuation allowance of $18 million against the deferred tax asset related to the state loss carryforwards. We have provided $21 million of taxes on earnings we intend to remit. All other earnings are considered permanently reinvested. We would be subject to withholding taxes if we were to distribute these permanently reinvested earnings from our U.S. subsidiaries and certain foreign subsidiaries. At December 31, 2016, the undistributed earnings of these subsidiaries were $236 million. Unrecognized deferred income tax liabilities, including withholding taxes, of approximately $0.2 million would be payable upon distribution of these earnings. We operate under a tax holiday in Malaysia, our new Asia Pacific headquarters. This tax holiday is effective through December 31, 2020, and may be extended for an additional five years if we satisfy certain requirements. The Malaysian tax holiday reduced our 2016 foreign by $0.2 million. We conduct business globally and, as a result, we or one or more of our subsidiaries file income tax returns in a number of jurisdictions. In the normal course of business, we are subject to examination by taxing authorities throughout the world, including such major jurisdictions as Malaysia, Australia, Indonesia, Singapore, Saudi Arabia, Kuwait, India, and the United States. With few exceptions, we are no longer subject to tax examinations for years prior to 2010. A reconciliation of unrecognized tax benefits is as follows: Year Ended December 31, 2016 2015 2014 (in thousands) Balance at beginning of period $ 36,353 $ 34,106 $ 40,613 Increases based on tax positions taken in the current year 2,328 4,720 3,479 Increases based on tax positions taken in prior years 7,741 4,710 3,195 Decreases based on tax positions taken in prior years (5,090 ) (2,836 ) (863 ) Decreases due to lapse of applicable statute of limitation (310 ) (4,347 ) (12,318 ) Balance at end of period $ 41,022 $ 36,353 $ 34,106 The entire balance of unrecognized tax benefits at December 31, 2016 would reduce our effective tax rate if recognized. We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. At December 31, 2016, 2015 and 2014, we had recorded liabilities of approximately $20 million, $16 million and $15 million, respectively, for the payment of tax-related interest and penalties. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 16—EARNINGS PER SHARE Basic earnings per share is computed by dividing net income attributable to McDermott International, Inc. by the weighted average number of common shares outstanding during the period. Diluted earnings per share equals net income attributable to McDermott International, Inc. divided by the weighted average common shares outstanding adjusted for the dilutive effect of our stock–based awards and common stock purchase contracts. The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, 2016 2015 2014 (In thousands, except share and per share amounts) Net income (loss) attributable to McDermott International, Inc. $ 34,117 $ (17,983 ) $ (75,994 ) Weighted average common stock (basic) 240,359,363 238,240,763 237,229,086 Effect of dilutive securities: Tangible equity units 40,824,938 - - Stock options, restricted stock and restricted stock units 2,999,938 - - Potential dilutive common stock 284,184,239 238,240,763 237,229,086 Net income (loss) per share Net income (loss) attributable to McDermott International, Inc. Basic: $ 0.14 $ (0.08 ) $ (0.32 ) Diluted: $ 0.12 $ (0.08 ) $ (0.32 ) Approximately 2.2 million, 2.9 million and 3.1 million shares underlying outstanding stock-based awards were excluded from the computation of diluted earnings per share in 2016, 2015 and 2014, respectively, because inclusion of such shares would have been antidilutive in each of those years. Potential dilutive common shares for the settlement of our common stock purchase contracts, a component of our TEUs, of 40.9 million and 30.7 million shares were considered in the calculation of diluted weighted-average shares in 2015 and 2014, respectively. Restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) totaling 2.4 million were also considered in the calculation of diluted weighted average shares for 2015. However, due to our net loss position in 2015 and 2014, shares underlying TEUs, RSUs, and RSAs have not been reflected in the diluted earnings per share, because inclusion of those shares would have been antidilutive. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders Equity Note [Abstract] | |
STOCKHOLDERS? EQUITY | NOTE 17— STOCKHOLDERS’ EQUITY The changes in the number of ordinary shares outstanding and treasury shares held by the Company are as follows: Year Ended December 31, 2016 2015 Shares outstanding Beginning balance 239,016,924 237,809,823 Common stock issued 3,304,808 1,672,923 Purchase of common stock (933,455 ) (465,822 ) Ending balance 241,388,277 239,016,924 Shares held as Treasury shares Beginning balance 7,824,204 7,400,027 Purchase of common stock 933,455 465,822 Retirement of common stock (455,655 ) (41,645 ) Ending balance 8,302,004 7,824,204 Ordinary shares issued at the end of the period 249,690,281 246,841,128 Accumulated Other Comprehensive Income (Loss) The components of AOCI included in stockholders’ equity are as follows: December 31, 2016 December 31, 2015 (In thousands) Foreign currency translation adjustments ("FCTA") $ (42,082 ) $ (29,925 ) Net unrealized gain on investments 269 247 Net loss on derivative financial instruments (25,082 ) (64,277 ) Accumulated other comprehensive loss $ (66,895 ) $ (93,955 ) During the first quarter of 2016, we recorded a $7 million adjustment decreasing FCTA, with an offsetting reduction of Loss on foreign currency, net, to correct amounts accounted for inappropriately in a previous period. In the second quarter of 2016, foreign currency instruments associated with construction of our DLV 2000 The following table presents the components of AOCI and the amounts that were reclassified during 2016, 2015 and 2014: Foreign currency translation adjustments Unrealized holding gain (loss) on investments Gain (loss) on derivative (1) TOTAL (In thousands) Balance, January 1, 2014 $ (2,562 ) $ 238 $ (45,386 ) $ (47,710 ) Other comprehensive income (loss) before reclassification (9,250 ) 3 (65,503 ) (74,750 ) Amounts reclassified from AOCI (3,400 ) - 28,052 (2) 24,652 Net current period other comprehensive income (loss) (12,650 ) 3 (37,451 ) (50,098 ) Balance, December 31, 2014 (15,212 ) 241 (82,837 ) (97,808 ) Other comprehensive income (loss) before reclassification (12,470 ) 6 (57,459 ) (69,923 ) Amounts reclassified from AOCI (2,243 ) - 76,019 (2) 73,776 Net current period other comprehensive income (loss) (14,713 ) 6 18,560 3,853 Balance, December 31, 2015 (29,925 ) 247 (64,277 ) (93,955 ) Other comprehensive income (loss) before reclassification (12,157 ) 22 4,004 (8,131 ) Amounts reclassified from AOCI - - 35,191 (2) 35,191 Net current period other comprehensive income (loss) (12,157 ) 22 39,195 27,060 Balance, December 31, 2016 $ (42,082 ) $ 269 $ (25,082 ) $ (66,895 ) (1) Refer to Note 12, Derivative Financial Instruments, for additional details (2) Reclassified to cost of operations and gain (loss) on foreign currency, net Noncontrolling Interest In 2013, we entered into certain joint ventures with TH Heavy Engineering Berhad (“THHE”), whereby we acquired a 30% interest in THHE Fabricators Sdn. Bhd. (“THF”), a subsidiary of THHE, and THHE acquired a 30% interest in our Malaysian subsidiary, Berlian McDermott Sdn. Bhd (“BMD”). In the third quarter of 2016, we reacquired the 30% of noncontrolling interest in BMD from THHE in exchange for our 30% equity interest in THF. We determined the fair value of the asset surrendered to be $17 million. In connection with the acquisition of the BMD noncontrolling interest, we recorded an $18 million decrease in noncontrolling interest, and, in connection with the sale of our investment in THF, we recorded a $12 million decrease in investments in unconsolidated affiliates and a $5 million gain in Other non-operating income (expense), net in our Consolidated Financial Statements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 18—COMMITMENTS AND CONTINGENCIES Investigations and Litigation We co-own interests in several entities (collectively “FloaTEC”) with Keppel Corporation (including its subsidiaries, “Keppel”). We have conducted an internal investigation in connection with allegations by a former Petrobras employee that Keppel’s agent made improper payments to secure project awards from Petrobras on a number of Keppel affiliated projects in Brazil, including a FloaTEC project on which we were also a subcontractor. Keppel’s agent subsequently entered into a plea arrangement with the Brazilian authorities and admitted to having made improper payments on behalf of Keppel to former Petrobras employees on projects unrelated to FloaTEC. We voluntarily contacted the U.S. Department of Justice (“DOJ”) to advise it of the preliminary results of our internal investigation, which identified no evidence to indicate any improper payments were made by us or FloaTEC or that any of our or FloaTEC’s employees authorized, had knowledge of, or direction or control over, any such payments. We have responded to the DOJ’s requests for additional information. If in the future, the DOJ determines that violations of applicable law have occurred involving us, we could be subject to civil or criminal sanctions, including monetary penalties, which could be material. However, based on the preliminary results of our investigation, we do not expect this matter to have a material adverse effect on us or our operations. Additionally, due to the nature of our business, we and our affiliates are, from time to time, involved in litigation or subject to disputes or claims related to our business activities, including, among other things: • performance or warranty-related matters under our customer and supplier contracts and other business arrangements; and • workers’ compensation claims, Jones Act claims, occupational hazard claims, including asbestos-exposure claims, premises liability claims and other claims. Based upon our prior experience, we do not expect that any of these other litigation proceedings, disputes and claims will have a material adverse effect on our consolidated financial condition, results of operations or cash flows; however, because of the inherent uncertainty of litigation and other dispute resolution proceedings and, in some cases, the availability and amount of potentially applicable insurance, we can provide no assurance that the resolution of any particular claim or proceeding to which we are a party will not have a material effect on our consolidated financial condition, results of operations or cash flows for the fiscal period in which that resolution occurs. Environmental Matters We have been identified as a potentially responsible party at various cleanup sites under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (“CERCLA”). CERCLA and other environmental laws can impose liability for the entire cost of cleanup on any of the potentially responsible parties, regardless of fault or the lawfulness of the original conduct. Generally, however, where there are multiple responsible parties, a final allocation of costs is made based on the amount and type of wastes disposed of by each party and the number of financially viable parties, although this may not be the case with respect to any particular site. We have not been determined to be a major contributor of wastes to any of these sites. On the basis of our relative contribution of waste to each site, we expect our share of the ultimate liability for the various sites will not have a material adverse effect on our consolidated financial condition, results of operations or cash flows in any given year. In 2013, we established a $6 million environmental reserve in connection with our plan to discontinue the utilization of our Morgan City fabrication facility. For this site, up to June 30, 2016, we incurred approximately $4 million. During the second quarter of 2016 we received a notice from the State of Louisiana stating that our environmental remediation obligations related to the closure of our Morgan City fabrication facility had been fulfilled. Pursuant to the notice received from the State of Louisiana, as well as our internal assessment, we believe no environmental remediation liability exists with respect to the Morgan City site. As a result, during 2016, we reversed $1 million of environmental remediation obligation accrual. Contracts Containing Liquidated Damages Provisions Some of our contracts contain provisions that require us to pay liquidated damages if we are responsible for the failure to meet specified contractual milestone dates and the applicable customer asserts a claim under those provisions. Those contracts define the conditions under which our customers may make claims against us for liquidated damages. In many cases in which we have historically had potential exposure for liquidated damages, such damages ultimately were not asserted by our customers. As of December 31, 2016, we had approximately $16 million of potential liquidated damages exposure, however the amount of liability recorded in our Consolidated Financial Statements is under $1 million. We believe we will be successful in obtaining schedule extensions or other customer-agreed changes that should resolve the potential for unaccrued liquidated damages. Accordingly, we believe that no amounts for these potential liquidated damages are probable of being paid by us. However, we may not achieve relief on some or all of the issues involved and, as a result, could be subject to higher damage amounts. Operating Leases Future minimum payments required under operating leases that have initial or remaining non-cancellable lease terms in excess of one year at December 31, 2016 are as follows (in thousands): Fiscal Year Ending December 31, Amount 2017 $ 27,864 2018 23,185 2019 19,076 2020 19,208 2021 14,425 Thereafter 122,922 Total rental expense in 2016, 2015 and 2014 was $36 million, $40 million and $107 million, respectively. These expense amounts include contingent rentals and are net of sublease income, neither of which is material. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 19—SEGMENT REPORTING We disclose the results of each of our reportable segments in accordance with ASC 280, Segment Reporting We manage reportable segments along geographic lines consisting of (1) AEA, (2) MEA and (3) ASA. We also report certain corporate and other non-operating activities under the heading “Corporate and Other.” Corporate and Other primarily reflects costs that are not allocated to our reportable segments. In the first quarter of 2017, we implemented certain changes to our financial reporting structure. Corporate expenses, certain centrally managed initiatives (such as restructuring charges), impairments, year-end MTM pension actuarial gains and losses, costs not attributable to a particular reportable segment and unallocated direct operating expenses associated with the underutilization of vessels, fabrication facilities and engineering resources, are no longer apportioned to our reportable segments. Those expenses are reported under “Corporate and Other.” We account for intersegment sales at prices that we generally establish by reference to similar transactions with unaffiliated customers. Reportable segments are measured based on operating income, which is defined as revenues reduced by total costs and expenses and equity in loss of unconsolidated affiliates. 1. Year Ended December 31, 2016 2015 2014 (In thousands) Revenues (1) AEA $ 285,988 $ 478,800 $ 567,608 MEA 1,241,591 1,134,555 795,666 ASA 1,108,404 1,456,920 937,615 Total revenues: $ 2,635,983 $ 3,070,275 $ 2,300,889 Income (loss) before provision for income taxes: Operating income (loss) (2) AEA $ 51,129 $ 52,918 $ (65,565 ) MEA 209,401 146,866 47,863 ASA 97,963 123,718 90,838 Segment operating income 358,493 323,502 73,136 Corporate and Other (216,240 ) (210,820 ) (56,734 ) Total operating income $ 142,253 $ 112,682 $ 16,402 Interest expense, net (58,871 ) (50,058 ) (60,877 ) Other non-operating income (expense), net (1,067 ) 1,986 7,002 Income (loss) before provision for income taxes $ 82,315 $ 64,610 $ (37,473 ) Capital expenditures (3) AEA $ 16,667 $ 13,715 $ 53,431 MEA 18,564 28,328 99,974 ASA 190,260 60,220 154,735 Corporate and Other 2,588 588 13,047 Total capital expenditures: $ 228,079 $ 102,851 $ 321,187 Depreciation and amortization: AEA $ 26,924 $ 43,006 $ 34,494 MEA 24,268 30,567 31,876 ASA 30,314 16,880 19,020 Corporate and Other 8,376 9,881 7,795 Total depreciation and amortization: $ 89,882 $ 100,334 $ 93,185 Drydock amortization AEA $ 9,905 $ 12,554 $ 11,453 MEA 1,975 2,089 2,011 ASA 915 3,304 6,255 Total drydock amortization $ 12,795 $ 17,947 $ 19,719 (1) Intercompany transactions were not significant during 2016, 2015 and 2014. (2) The 2016 and 2015 Corporate and Other operating results include $55 million and $7 million of impairment, respectively. The 2014 Corporate and Other operating results include $11 million of improvements to the cancellation cost estimate included in the $38 million vessel impairment charge recognized in 2013. See Note 13, Fair Value Measurements, for further discussion. (3) Total capital expenditures represent expenditures for which cash payments were made during the period. Capital expenditures for 2016, 2015 and 2014 include $4 million, $14 million and $27 million of cash payments for accrued capital expenditures outstanding as of December 31, 2015, 2014 and 2013, respectively. 2. Information about our most significant Customers Our significant customers by segments during 2016, 2015 and 2014, were as follows: % of Consolidated Reportable Revenues Segment Year Ended December 31, 2016: Inpex Operations Australia Pty Ltd 33% ASA Saudi Aramco 26% MEA RasGas Company Limited 12% MEA Year Ended December 31, 2015: Inpex Operations Australia Pty Ltd 36% ASA Saudi Aramco 28% MEA Year Ended December 31, 2014: Saudi Aramco 27% MEA Inpex Operations Australia Pty Ltd 25% ASA 3. Information about our Service Lines and Operations in Different Geographic Areas: Year Ended December 31, 2016 2015 2014 (In thousands) Service line revenues: Installation Operations $ 1,074,069 $ 1,256,412 $ 1,041,525 Procurement Activities 879,222 1,123,329 677,734 Project Services and Engineering Operations 356,781 416,906 314,776 Fabrication Operations 325,911 273,628 266,854 $ 2,635,983 $ 3,070,275 $ 2,300,889 Geographic revenues: Australia $ 881,812 $ 1,157,723 $ 614,164 Saudi Arabia 767,119 900,483 616,659 Qatar 419,963 46,873 - Mexico 112,484 247,859 130,642 Russia 108,392 - - United States 95,996 32,858 148,606 Trinidad 67,757 - - India 56,027 - - United Arab Emirates 54,392 185,606 57,249 Malaysia 22,637 - 98,004 Indonesia 21,726 54,288 150,205 Brunei - 237,337 - Brazil 6,449 183,656 290,561 Azerbaijan - - 111,382 Other countries 21,229 23,592 83,417 $ 2,635,983 $ 3,070,275 $ 2,300,889 4. Information about our Segment Assets and Property, Plant and Equipment by Country: Year Ended December 31, 2016 2015 (In thousands) Segment assets: AEA $ 727,328 $ 896,822 MEA 907,936 971,170 ASA 976,470 774,365 Corporate and Other 610,496 744,719 Total assets $ 3,222,230 $ 3,387,076 Property, plant and equipment, net (1) Australia $ 626,605 $ - Mexico 603,185 96,090 United Arab Emirates 318,822 341,502 United States 27,482 561,990 Saudi Arabia 22,608 4,522 Indonesia 73,213 521,922 India 10,666 307 Malaysia 2,457 49,609 Brazil 170 31,765 Other countries 2,093 3,152 Total property, plant and equipment, net $ 1,687,301 $ 1,610,859 ( 1) Our marine vessels are included in the country in which they were located as of year-end. 5. Information about our Unconsolidated Affiliates: Year Ended December 31, 2016 2015 2014 (In thousands) Equity in loss of unconsolidated affiliates: AEA $ (5,082 ) $ (6,255 ) $ 4,829 MEA - (94 ) (2,668 ) ASA 1,167 (15,137 ) (10,009 ) Corporate and Other (175 ) - - Total equity in loss of unconsolidated affiliates: $ (4,090 ) $ (21,486 ) $ (7,848 ) Investments in unconsolidated affiliates: AEA $ 2,449 $ 1,540 ASA 14,064 24,327 Corporate and Other 510 684 Total investments in unconsolidated affiliates $ 17,023 $ 26,551 Our consolidated balance sheets include accounts receivable attributable to our unconsolidated affiliates of approximately $17 million and $13 million as of December 31, 2016 and 2015, respectively. |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | NOTE 20—QUARTERLY FINANCIAL DATA (UNAUDITED) The following tables set forth selected unaudited quarterly financial information for the quarterly periods in 2016 and 2015: For the Quarter Ended March 31 (1) June 30 (2) September 30 (3) December 31 (4) 2016 (In thousands, except per share data amounts) Revenues $ 729,032 $ 706,627 $ 558,543 $ 641,781 Gross Profit 112,999 111,185 103,044 59,139 Net income (loss) (2,444 ) 21,805 16,392 546 Net income (loss) attributable to non-controlling interest (272 ) 1,148 284 1,022 Net income (loss) attributable to McDermott International, Inc. (2,172 ) 20,657 16,108 (476 ) Income (loss) per share (5) Basic (0.01 ) 0.09 0.07 0.00 Diluted (0.01 ) 0.07 0.06 0.00 (1) (2) (3) (4) (5) For the Quarter Ended March 31 (1) June 30 (2) September 30 (3) December 31 (4) 2015 (In thousands, except per share data amounts) Revenues $ 550,463 $ 1,046,537 $ 805,857 $ 667,418 Gross Profit 75,004 121,015 84,896 98,076 Net income (loss) (12,048 ) 13,690 7,534 (18,015 ) Net income attributable to non-controlling interest 2,459 2,164 3,868 653 Net income (loss) attributable to McDermott International, Inc. (14,507 ) 11,526 3,666 (18,668 ) Income (loss) per share (5) Basic (0.06 ) 0.05 0.02 (0.08 ) Diluted (0.06 ) 0.04 0.01 (0.08 ) (1) Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. (2) Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. (3) Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. (4) Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. (5) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 21—SUBSEQUENT EVENTS In February 2017, J. Ray McDermott de Mexico, S.A. de C.V. (“JRM Mexico”), one of our indirectly 100% owned subsidiaries, entered into a 364 day, $50 million committed revolving receivables purchase agreement which provides for the sale, at a discount, of certain receivables to a designated purchaser. JRM Mexico’s obligations in connection with the receivables purchase agreement are guaranteed by McDermott International, Inc. Additionally in February 2017, JRM Mexico entered into a 21-month loan agreement for equipment financing in the amount of $48 million. Borrowings under the loan agreement bear interest at a fixed rate of 5.75%. JRM Mexico’s obligations in connection with equipment financing are guaranteed by McDermott International Management, S. de RL, one of our indirectly 100% owned subsidiaries. In January 2017, we purchased the pipelay and construction vessel, the Amazon Amazon Amazon |
BASIS OF PRESENTATION AND SIG29
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations McDermott International, Inc. (“MDR”), a corporation incorporated under the laws of the Republic of Panama in 1959, is a leading provider of integrated engineering, procurement, construction and installation (“EPCI”), front-end engineering and design (“FEED”), and module fabrication services for upstream field developments worldwide. We deliver fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for complex offshore and subsea oil and gas projects. Operating in approximately 20 countries across Americas, Europe, Africa, the Middle East, Asia and Australia, our integrated resources include a diversified fleet of marine vessels, fabrication facilities and engineering offices. We support our activities with comprehensive project management and procurement services, while utilizing our fully integrated capabilities in both shallow water and deepwater construction. Our customers include national, major integrated and other oil and gas companies, and we operate in most major offshore oil and gas producing regions throughout the world. We execute our contracts through a variety of methods, principally fixed-price, but also including cost reimbursable, cost-plus, day-rate and unit-rate basis or some combination of those methods. In these Notes to our Consolidated Financial Statements, unless the context otherwise indicates, “we,” “us” and “our” mean MDR and its consolidated subsidiaries. |
Basis of Presentation | Basis of Presentation We have presented our Consolidated Financial Statements in U.S. Dollars in accordance with accounting principles generally accepted in the United States (“GAAP”). These Consolidated Financial Statements include the accounts of McDermott International, Inc., its consolidated subsidiaries and controlled entities. Subsidiaries are defined as being those companies over which we, either directly or indirectly, have control through a majority of the voting rights or the right to exercise control or to obtain the majority of the benefits and be exposed to the majority of the risks. Subsidiaries are consolidated from the date on which control is obtained until the date that such control ceases. All intercompany transactions and balances have been eliminated in consolidation. |
Business Segments | Business Segments We report financial results under three reportable segments consisting of (1) Americas, Europe, and Africa (“AEA”), (2) the Middle East (“MEA”) and (3) Asia (“ASA”). We also report certain corporate and other non-operating activities under the heading “Corporate and Other.” Corporate and Other primarily reflects costs that are not allocated to our reportable segments. For financial information about our segments, see Note 19, Segment Reporting. |
Revenue Recognition | Revenue Recognition Contracts― We determine the appropriate accounting treatment for each of our contracts with customers before work on the project begins. We generally recognize contract revenues and related costs on a percentage-of-completion method for individual contracts or combinations of contracts based on work performed, man hours, or a cost-to-cost method, as applicable to the activity involved. We include the amount of accumulated contract costs and estimated earnings that exceed billings to customers in Contracts in Progress. We include billings to customers that exceed accumulated contract costs and estimated earnings in Advance Billings on Contracts. Most long-term contracts contain provisions for progress payments. We expect to invoice customers for all unbilled revenues. Certain costs are generally excluded from the cost-to-cost method of measuring progress, such as significant costs for materials and third-party subcontractors. On certain projects, we may purchase a significant portion of the materials or incur third-party subcontractor costs, recognized as project costs, either upfront or during other phases of contract execution. Therefore, we believe exclusion of the costs for such materials and subcontractors provides a better measure of actual progress toward completion, particularly in the early stages of contracts, as inclusion of these costs could overstate the progress of projects. We believe that our approach more closely aligns with the actual, physical progress of our contracts. Costs incurred prior to a project award are generally expensed during the period in which they are incurred. Total estimated project costs and resulting contract income are affected by changes in the expected cost of materials and labor, productivity, vessel costs, scheduling and other factors. Additionally, external factors such as weather, customer requirements and other factors outside of our control may affect the progress and estimated cost of a project’s completion and, therefore, the timing and amount of revenue and income recognition. We regularly review contract price and cost estimates as the work progresses and reflect adjustments in profit proportionate to the job percentage of completion during the period in which those estimates are revised. Unapproved Change Orders― Change orders, which are a normal and recurring part of our business, can increase, sometimes substantially, the future scope and cost of a job. Therefore, change order awards, although frequently beneficial in the long term, can have the short-term effect of reducing the job percentage of completion and thus the revenues and profits recognized to date. Revenues and gross profit on contracts can be significantly affected by change orders that may not be approved by the customer until the later stages of a contract or subsequent to the date a project is completed. If it is not probable the costs will be recovered through a change in contract price, the costs attributable to change orders are treated as contract costs without incremental revenue. For certain contracts where it is probable the costs will be recovered through a change order, total estimated contract revenue is increased by the lesser of the amounts management expects to recover and the costs expected to be incurred. Revenue from unapproved change orders is generally recognized to the extent of the lesser of amounts we expect to recover or costs incurred. To the extent claims included in backlog are not resolved in our favor, there could be reductions in, or reversals of previously reported amounts of, revenues and profits, and charges against current earnings, which could be material. Claims Revenue— Claims revenue may relate to various factors, including the procurement of materials, equipment performance failures, change order disputes or schedule disruptions and other delays, including those associated with weather and sea conditions. Claims revenue, when recorded, is only recorded to the extent of the lesser of the amounts management expects to recover and the associated costs incurred. We include certain unapproved claims in the applicable contract values when we have a legal basis to do so, consider collection to be probable and believe we can reliably estimate the ultimate value. Amounts attributable to unapproved change orders are not included in claims. We continue to actively engage in negotiations with our customers on our outstanding claims. However, these claims may be resolved at amounts that differ from our current estimates, which could result in increases or decreases in future estimated contract profits or losses. Claims are generally negotiated over the course of the respective projects, many of which are long-term in nature. Deferred Profit Recognition― For contracts as to which we are unable to estimate the final profitability due to their uncommon nature, including first-of-a-kind projects, we recognize equal amounts of revenue and cost until the final results can be estimated more precisely. For these contracts, we only recognize gross margin when reliably estimable and the level of uncertainty has been significantly reduced, which we generally determine to be when the contract is at least 70% complete. We treat long-term construction contracts that contain such a level of risk and uncertainty that estimation of the final outcome is impractical as deferred profit recognition contracts. If, while being accounted for under our deferred profit recognition policy, a current estimate of total contract costs indicates a loss, the projected loss is recognized in full and the project is accounted for under our normal revenue recognition guidelines. Currently, we are not accounting for any projects under our deferred profit recognition policy. Completed Contract Method― Under the completed contract method, revenue and gross profit is recognized only when a contract is complete or substantially complete. We generally do not enter into fixed-price contracts without an estimate of cost to complete that we believe to be accurate. However, it is possible that in the time between contract award and the commencement of work on a project we could lose the ability to forecast costs to complete adequately based on intervening events, including, but not limited to, experience on similar projects, civil unrest, strikes and volatility in our expected costs. In such a situation, we would use the completed contract method of accounting for that project. In last three years, we did not enter into any contracts that we accounted for under the completed contract method. Loss Recognition― A risk associated with fixed-priced contracts is that revenue from customers may not cover increases in our costs. It is possible that current estimates could materially change for various reasons, including, but not limited to, fluctuations in forecasted labor and vessel productivity, vessel repair requirements, weather downtime, subcontractor or supplier performance, pipeline lay rates or steel and other raw material prices. Increases in costs associated with our fixed-price contracts could have a material adverse impact on our consolidated financial condition, results of operations and cash flows. Alternatively, reductions in overall contract costs at completion could materially improve our consolidated financial condition, results of operations and cash flows. See Note 2, Revenue Recognition . |
Use of Estimates | Use of Estimates We use estimates and assumptions to prepare our financial statements in conformity with GAAP. Those estimates and assumptions affect the amounts we report in our Consolidated Financial Statements and accompanying Notes. Our actual results could differ from those estimates, and variances could materially affect our financial condition and results of operations in future periods. Changes in project estimates generally exclude change orders and changes in scope, but may include, without limitation, changes in cost recovery estimates, unexpected changes in weather conditions, changes in productivity, unidentified required vessel repairs, customer and vendor delays and other costs. We generally expect to experience a reasonable amount of unanticipated events, and some of those events can result in significant cost increases above cost amounts we previously estimated. As of December 31, 2016, we have provided for our estimated costs to complete on all of our ongoing contracts. However, it is possible that current estimates could change due to unforeseen events, which could result in adjustments to overall contract costs. Variations from estimated contract performance could result in material adjustments to operating results. For all contracts, if a current estimate of total contract cost indicates a loss, the projected loss is recognized in full when determined. |
Loss Contingencies | Loss Contingencies We record liabilities for loss contingencies when it is probable that a liability has been incurred and the amount of loss is reasonably estimable. We provide disclosure when there is a reasonable possibility that the ultimate loss will exceed the recorded provision or if such loss is not reasonably estimable. We are currently involved in litigation and other proceedings, as discussed in Note 18, Commitments and Contingencies |
Stock-Based Compensation | Stock-Based Compensation Equity instruments are measured at fair value on the grant date. Stock-based compensation expense is generally recognized on a straight-line basis over the requisite service periods of the awards. We use a Black-Scholes model to determine the fair value of certain share-based awards, such as stock options. Additionally, we use a Monte Carlo model to determine the fair value of certain share-based awards that contain market and performance-based conditions. The use of these models requires highly subjective assumptions, such as assumptions about the expected life of the award, vesting probability, expected dividend yield and the volatility of our stock price. See Note 14, Stock-Based Compensation, |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash Our cash and cash equivalents are highly liquid investments with maturities of three months or less when we purchase them. We record cash and cash equivalents as restricted when we are unable to freely use such cash and cash equivalents for our general operating purposes. A majority of our restricted cash and cash equivalents serves as collateral for outstanding letters of credit, as further discussed in Note 10, Debt |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at the invoiced amount based on contracted prices. Amounts collected on accounts receivable are included in total cash provided by operating activities in the Consolidated Statements of Cash Flows. We establish allowances for doubtful accounts based on our assessments of our customers’ willingness and abilities to pay. In addition to such allowances, there are often items in dispute or being negotiated that may require us to make an estimate as to the ultimate outcome. Past due receivable balances are written off when our internal collection efforts have been unsuccessful in collecting the amounts due. Retainage, included in accounts receivable, represents amounts withheld from billings by our clients pursuant to provisions in the applicable contracts and may not be paid to us until the completion of specific tasks or the completion of the project and, in some instances, for even longer periods. Retainage may also be subject to restrictive conditions, such as performance guarantees. |
Property, Plant and Equipment | Property, Plant and Equipment We carry our property, plant and equipment at depreciated cost. Except for major marine vessels, we depreciate our property, plant and equipment using the straight-line method, over the estimated economic useful lives of eight to 33 years for buildings and three to 28 years for machinery and equipment. We do not depreciate property, plant and equipment classified as held for sale. We depreciate major marine vessels using the units-of-production method based on the utilization of each vessel. Our units-of-production method of depreciation involves the calculation of depreciation expense on each vessel based on the product of actual utilization for the vessel for the period and the applicable daily depreciation value (which is based on vessel book value, standard utilization and vessel life) for the vessel. Our actual utilization is determined based on the actual days that the vessel was working or otherwise actively engaged (other than in transit between regions) under a contract, as determined by daily vessel operating reports prepared by the crew of the vessel. Our standard utilization is determined by vessel at least annually based on recent actual utilization combined with an expectation of future utilization, both of which allow for idle time. We ensure that a minimum amount of accumulated depreciation of at least 50% of equivalent life-to-date straight-line depreciation is recorded. Additionally, in periods of very low utilization, a minimum amount of depreciation expense of at least 25% of an equivalent straight-line depreciation expense (which is based on an initial 25-year life) is recorded. We capitalize drydocking costs in other current assets and other assets when incurred and amortize the costs over the period of time between two drydock periods, which is generally five years. We expense the costs of other maintenance, repairs and renewals, which do not materially prolong useful life of an asset, as we incur them. |
Investments in Unconsolidated Affiliates | Investments in Unconsolidated Affiliates We account for equity investments using the equity method of accounting if we have the ability to exercise significant influence over, but not control of, an investee. Significant influence generally exists if we have an ownership interest representing between 20% and 50% voting rights. Under the equity method of accounting, investments are stated initially at cost and are adjusted for subsequent additional investments and our proportionate share of profit or losses and distributions. We record our share of the profit or losses of the equity method investments, net of income taxes, in the Consolidated Statements of Operations. When our share of losses in an equity investment equals or exceeds our interest in the equity investment, including any other unsecured receivables, we do not recognize further losses, unless we have incurred obligations or made payments on behalf of the equity investment. We evaluate our equity method investments for impairment when events or changes in circumstances indicate, in our management’s judgment, that the carrying value of such investments may have experienced other-than-temporary decline in value. When evidence of loss in value has occurred, we compare the estimated fair value of investment to the carrying value of investment to determine whether an impairment has occurred. If the estimated fair value is less than the carrying value and our management considers the decline in value to be other-than-temporary, the excess of the carrying value over the estimated fair value is recognized in the Consolidated Financial Statements as an impairment. |
Derivative Financial Instruments | Derivative Financial Instruments Our worldwide operations give rise to exposure to changes in certain market conditions, which may adversely impact our financial performance. When we deem it appropriate, we use derivatives as a risk management tool to mitigate the potential impacts of certain market risks. The primary market risk we manage through the use of derivative instruments is movement in foreign currency exchange rates. We use foreign currency derivative contracts to reduce the impact of changes in foreign currency exchange rates on our operating results. We use these instruments to hedge our exposure associated with revenues, costs (or both) on our long-term contracts and other cash flow exposures that are denominated in currencies other than our operating entities’ functional currencies. We do not hold or issue financial instruments for trading or other speculative purposes. In certain cases, contracts with our customers contain provisions under which some payments from our customers are denominated in U.S. Dollars and other payments are denominated in a foreign currency. In general, the payments denominated in a foreign currency are designed to compensate us for costs that we expect to incur in such foreign currency. In these cases, we may use derivative instruments to reduce the risks associated with foreign currency exchange rate fluctuations arising from differences in timing of our foreign currency cash inflows and outflows. We recognize all derivatives at fair value on the balance sheet. Derivatives that are not accounted for as hedges under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815, Derivatives and Hedging Derivative Financial Instruments The ineffective portion of a derivative’s change in fair value and any portion excluded from the assessment of effectiveness are immediately recognized in earnings. Gains and losses on derivative financial instruments that are immediately recognized in earnings generally are included as a component of gain (loss) on foreign currency—net in our Consolidated Statements of Operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. An established hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: • Level 1—inputs are based on quoted prices for identical instruments traded in active markets. • Level 2—inputs are based on quoted prices for similar instruments in active markets, quoted prices for similar or identical instruments in inactive markets and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets and liabilities. • Level 3—inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar valuation techniques. The carrying amounts that we have reported for financial instruments, including cash and cash equivalents, restricted cash and cash equivalents, accounts receivables and accounts payable approximate their fair values due to the short maturity of those instruments. See Note 13, Fair Value Measurements, |
Insurance and Self-Insurance | Insurance and Self-Insurance Our wholly owned “captive” insurance subsidiary provides coverage for our retentions under employer’s liability, general and products liability, automobile liability and workers’ compensation insurance and, from time to time, builder’s risk and marine hull insurance within certain limits. We may also have business reasons in the future to arrange for our insurance subsidiary to insure other risks which we cannot or do not wish to transfer to outside insurance companies. Premiums charged and reserves related to these insurance programs are based on the facts and circumstances specific to the insurance claims, our past experience with similar claims, loss factors and the performance of the outside insurance market for the type of risk at issue. The actual outcome of insured claims could differ significantly from estimated amounts. We maintain actuarially determined accruals in our consolidated balance sheets to cover self-insurance retentions for the coverages discussed above. These accruals are based on various assumptions developed utilizing historical data to project future losses. Loss estimates in the calculation of these accruals are adjusted as required based upon reported claims, actual claim payments and settlements and claim reserves. These loss estimates and accruals recorded in our financial statements for claims have historically been reasonable. Claims as a result of our operations, if greater in frequency or severity than actuarially predicted, could adversely impact the ability of our captive insurance subsidiary to respond to all claims presented. |
Concentration of Credit Risk | Concentration of Credit Risk Our principal customers are businesses in the offshore oil and gas industry. This concentration of customers may impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic or other conditions. In addition, we and many of our customers operate worldwide and are therefore exposed to risks associated with the economic and political forces of various countries and geographic areas. We generally do not obtain any collateral for our receivables. See Note 19, Segment Reporting |
Pension and Postretirement Benefit Plans | Pension and Postretirement Benefit Plans We have both defined benefit (funded and unfunded) and defined contribution plans. For the defined benefit plans, a projected benefit obligation is calculated annually by independent actuaries using the unit credit method. We recognize actuarial gains and losses on pension and postretirement benefit plans immediately in our operating results. These gains and losses are generally measured annually as of December 31 and accordingly will normally be recorded during the fourth quarter, unless an earlier remeasurement is required. Should actual experience differ from actuarial assumptions, the projected pension benefit obligation and net pension cost and accumulated postretirement benefit obligation and postretirement benefit cost would be affected in future years. Pension costs primarily represent the increase in the actuarial present value of the obligation for pension benefits based on employee service during the year and the interest on this obligation in respect of employee service in previous years, offset by expected return on plan assets. For defined contribution plans, we pay contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The contributions are recognized as employee benefit expense when due. |
Foreign Currency Translation | Foreign Currency Translation We translate assets and liabilities of our foreign operations, other than operations in highly inflationary economies, into U.S. Dollars at year-end exchange rates, and we translate income statement items at average exchange rates for the periods presented. We record adjustments resulting from the translation of foreign currency financial statements as a component of other comprehensive income (loss), net of tax. |
Impairment Review | Impairment Review We review our tangible long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If an evaluation is required, the fair value of each applicable asset is compared to its carrying value. Factors that impact our determination of potential impairment include forecasted utilization of equipment and estimates of forecasted cash flows from projects expected to be performed in future periods. Our estimates of cash flow may differ from actual cash flow due to, among other things, economic conditions or changes in operating performance. Any changes in such factors may negatively affect our business segments and result in future asset impairments. |
Income Taxes | Income Taxes We provide for income taxes based on the tax laws and rates in the countries in which we conduct our operations. MDR is a Panamanian corporation that earns all of its income outside of Panama. As a result, we are not subject to income tax in Panama. We operate in various taxing jurisdictions around the world. Each of these jurisdictions has a regime of taxation that varies, not only with respect to nominal rates, but also with respect to the basis on which these rates are applied. These variations, along with changes in our mix of income or loss from these jurisdictions, may contribute to shifts, sometimes significant, in our effective tax rate. We believe that our deferred tax assets recorded as of December 31, 2016 are realizable through carrybacks, future reversals of existing taxable temporary differences and future taxable income. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as the net tax effects of net operating loss carryforwards. We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. If we subsequently determine that we will be able to realize deferred tax assets in the future in excess of our net recorded amount, the resulting adjustment would increase earnings for the period in which such determination was made. We will continue to assess the adequacy of the valuation allowance on a quarterly basis. Any changes to our estimated valuation allowance could be material to our consolidated financial condition and results of operations. See Note 15, Income Taxes |
Classification | Classification Certain prior year amounts have been reclassified for consistency with the current year presentation. Our Consolidated Financial Statements previously reported income and loss from investment in unconsolidated affiliates as components of operating income. In the first quarter of 2016, we concluded that classification of loss from investments in unconsolidated affiliates after provision for income tax better reflected how the operations of our unconsolidated affiliates relate to our business as a whole. In the first quarter of 2017, we implemented certain changes to our financial reporting structure resulting in: • Corporate expenses, certain centrally managed initiatives (such as restructuring charges), impairments, year-end mark-to-market (“MTM”) pension actuarial gains and losses, costs not attributable to a particular reportable , reportable • Research and development (“R&D”) expenses are separately presented in our Consolidated Statements of Operations. Previously R&D expenses were included in Cost of operations. • Gain (loss) on foreign currency, net is included in Other non-operating income (expense), net in our Consolidated Statements of Operations. Previously, Gain (loss) on foreign currency, net was separately presented. • Note 19 includes , under caption “Information about Operations”, a reconciliation of segment operating income (loss) before income taxes to Income (loss) before income taxes in our Consolidated Statements of Operations. Previously reported financial statements have been adjusted to reflect the above changes. |
Recently Issued and Adopted Accounting Guidance | Recently Issued and Adopted Accounting Guidance Statement of Cash Flows —In November 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, . This ASU clarifies how entities should present restricted cash and restricted cash equivalents in the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2017. Early adoption is permitted. We adopted this ASU in the fourth quarter of 2016. As a result, our Consolidated Statement of Cash Flows will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents. All comparative periods presented have been revised to reflect this change. See Note 5, for a reconciliation of the totals in Consolidated Statements of Cash Flows and in the Consolidated Balance Sheets. In August 2016, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. Consolidation —In October 2016, the FASB issued ASU 2016-17, . This ASU amends the primary beneficiary assessment under ASC 810, requiring that a single decision maker consider indirect interests held by related parties under common control on a proportionate basis. This ASU is effective for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. We adopted this ASU in the fourth quarter of 2016. Our adoption did not have a material impact on the accompanying Consolidated Financial Statements. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments In February 2015, the FASB issued ASU 2015-02, Consolidation: Amendments to the Consolidation Analysis, The amendments in ASUs 2015-16 and 2015-02 became effective for annual and interim periods beginning after December 15, 2015. Early adoption was permitted. We adopted these ASUs in the first quarter of 2016. Our adoption of these ASUs did not have a material impact on the accompanying Consolidated Financial Statements. Stock Compensation —In March 2016, the FASB issued ASU 2016-09, This ASU simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, earnings per share and classification in the statement of cash flows. We adopted this ASU in the second quarter of 2016. Our adoption did not have a material impact on the presentation of our Consolidated Financial Statements. Derivatives —In March 2016, the FASB issued ASU 2016-06 . This ASU clarifies that a contingent put or call option embedded in a debt instrument would be evaluated for possible separate accounting as a derivative instrument without regard to the nature of the exercise contingency. In March 2016, the FASB issued ASU 2016-05 , Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships. The amendments in ASU 2016-06 and 2016-05 are effective for interim and annual periods beginning after December 15, 2016. Early adoption is permitted. We adopted these ASUs in the fourth quarter of 2016. Our adoption of those ASUs did not have a material impact on the accompanying Consolidated Financial Statements. Income Tax— In November 2015, the FASB issued ASU 2015-17, . Under this ASU an entity shall classify deferred tax assets and liabilities as noncurrent. We adopted ASU 2015-17 in the first quarter of 2016. Our adoption of that ASU did not have a material impact on the presentation of our Consolidated Financial Statements. All comparable periods presented have been revised to reflect this change. Going Concern— In August 2014, the FASB issued ASU 2014-15, . Under this ASU, we are required to assess our ability to continue as a going concern each interim and annual reporting period and provide certain disclosures if there is substantial doubt about our ability to continue as a going concern, including our management’s plan to alleviate any such substantial doubt. ASU 2014-15 is effective for annual periods ending after December 15, 2016, and interim periods thereafter with early adoption permitted. We adopted this ASU in the third quarter of 2016. Our adoption of the ASU did not impact the presentation of our Consolidated Financial Statements or the disclosures in the Consolidated Financial Statements. |
Accounting Guidance Issued But Not Adopted | Accounting Guidance Issued But Not Adopted as of December 31, 2016 Income Taxes— In October 2016, the FASB issued ASU 2016-16, . This ASU requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The ASU is effective for interim and annual periods beginning after December 15, 2017. Early adoption is permitted. The application of this amendment is not expected to have a material impact on our future Consolidated Financial Statements and related disclosures. Financial Instruments —In June 2016, the FASB issued ASU 2016-13, . This ASU will require a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. A valuation account, allowance for credit losses, will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. This ASU is effective for interim and annual periods beginning after December 15, 2019. We are currently assessing the impact of this guidance on our future Consolidated Financial Statements and related disclosures. Leases —In February 2016, the FASB issued ASU 2016-02 . The ASU will require entities that lease assets—referred to as “lessees”—to recognize on the balance sheet the assets and liabilities for the rights and obligations created by leases with lease terms of more than 12 months. Consistent with current U.S. GAAP, the recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current U.S. GAAP—which requires only capital leases to be recognized on the balance sheet—the new ASU will require both types of leases to be recognized on the balance sheet. This ASU is effective for interim and annual periods beginning after December 15, 2018. Early adoption is permitted. We are currently assessing the impact of this ASU on our future Consolidated Financial Statements and related disclosures. Financial Assets and Liabilities —In January 2016, the FASB issued ASU 2016-01, . Under this new guidance, entities will be required to measure all investments in equity securities that are not subject to equity method or consolidation accounting at fair value, with changes recognized in net income. Fair value changes related to instrument-specific credit risk in financial liabilities accounted for under the fair value option in Accounting Standards Codification 825 must be recorded in other comprehensive income instead of earnings. ASU 2016-01 also changes presentation and disclosure requirements for financial assets and liabilities. ASU 2016-01 is effective for interim and annual periods beginning after December 15, 2017, with early adoption not permitted except related to changes in fair value for financial liabilities. We are currently assessing the impact of these amendments on our future Consolidated Financial Statements and related disclosures. Revenue from Contracts with Customers (Topic 606)— In May 2014, the FASB issued a new standard related to revenue recognition which supersedes most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. It also requires significantly expanded disclosures regarding the qualitative and quantitative information of an entity’s nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The FASB has issued several amendments to the standard, including clarification on accounting for licenses of intellectual property, identifying performance obligations, reporting gross versus net revenue and narrow-scope improvements and practical expedients. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (“full retrospective method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (“modified retrospective application”). We are currently assessing the impact of this ASU and the amendments on our future Consolidated Financial Statements and related disclosures. Adoption may affect the manner in which the company determines the unit of account for its projects and estimates revenue associated with unapproved change orders and claims. We intend to adopt the new standard on January 1, 2018 (the “initial application” date): • using the modified retrospective application, with no restatement of the comparative periods presented and a cumulative effect adjustment as of the date of adoption; • applying the new standard only to those contracts that are in process at the date of initial application; and • disclosing the impact of the new standard on our 2018 Consolidated Financial Statements. This standard could have a significant impact on our Consolidated Financial Statements and related disclosures. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Revenue Recognition [Abstract] | |
Percentage of Revenues by Contract Type | The percentage of our revenues by contract type for each of the years ended December 31 was as follows: 2016 2015 2014 Fixed-price 92 % 93 % 87 % Unit-basis and other 8 7 13 100 % 100 % 100 % |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring And Related Activities [Abstract] | |
Restructuring Costs Incurred and Future Cost Expected to be Incurred | Year ended December 31, Incurred from inception to 2016 2015 2014 December 31, 2016 (In thousands) Americas Restructuring $ (1,350 ) (1 ) $ 2,308 $ 9,170 $ 44,194 Corporate Restructuring - - 4,940 6,601 MPI Severance and other personnel-related costs 2,590 15,217 - 17,807 Asset impairment and disposal - 7,471 - 7,471 Legal and other advisor fees 222 7,414 4,003 11,639 Other 2,436 7,609 - 10,045 Total MPI 5,248 37,711 4,003 46,962 AOR Severance and other personnel-related costs 5,012 - - 5,012 Legal and other advisor fees 1,968 800 - 2,768 Other 385 - - 385 Total AOR 7,365 800 - 8,165 Total $ 11,263 $ 40,819 $ 18,113 $ 105,922 (1) This amount includes reversal of environmental liability established in connection with discontinued utilization of our Morgan City fabrication facility. For further discussion see, Note 18, Commitments and Contingencies . |
CASH, CASH EQUIVALENTS AND RE32
CASH, CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Cash And Cash Equivalents [Abstract] | |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets that sum to the totals of such amounts shown in the Consolidated Statements of Cash Flows. December 31, 2016 December 31, 2015 (in thousands) Cash and cash equivalents $ 595,921 $ 664,844 Restricted cash and cash equivalents 16,412 116,801 Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows $ 612,333 $ 781,645 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Contract Receivables | A summary of contract receivables is as follows: December 31, 2016 December 31, 2015 (in thousands) Contract receivables: Contracts in progress $ 245,604 164,898 Completed contracts 40,345 35,702 Retainages 58,431 17,896 Unbilled (1) 4,303 4,303 Less allowances (14,299 ) (14,325 ) Accounts receivable—trade, net $ 334,384 $ 208,474 (1) This amount relates to a project milestone billing for which we are awaiting the customer’s final acceptance certificate. We expect to receive the final acceptance certificate during 2017. |
Retainages on Contracts | The following amounts represent retainages on contracts: December 31, 2016 December 31, 2015 (in thousands) Retainages expected to be collected within one year $ 58,431 $ 17,896 Retainages expected to be collected after one year 127,193 155,061 Total retainages $ 185,624 $ 172,957 |
Summary of Accounts Receivable Other | A summary of accounts receivable—other is as follows: December 31, 2016 December 31, 2015 (In thousands) Receivables from unconsolidated affiliates $ 13,292 $ 12,816 Accrued unbilled other 12,075 14,021 Employee receivables 4,730 4,376 Other taxes receivable 2,483 28,743 Other 4,349 6,733 Accounts receivable — $ 36,929 $ 66,689 |
CONTRACTS IN PROGRESS AND ADV34
CONTRACTS IN PROGRESS AND ADVANCE BILLINGS ON CONTRACTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Contractors [Abstract] | |
Components of Contracts in Progress and Advance Billings on Contracts | Components of contracts in progress and advance billings on contracts is as follows: December 31, 2016 December 31, 2015 (In thousands) Costs incurred less costs of revenue recognized $ 119,688 $ 112,819 Revenues recognized less billings to customers 199,450 323,010 Contracts in Progress $ 319,138 $ 435,829 Billings to customers less revenue recognized 42,637 265,618 Costs incurred less costs of revenue recognized 149,849 (100,845 ) Advance Billings on Contracts $ 192,486 $ 164,773 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Summary of Property Plant Equipment by Asset Category | A summary of property, plant and equipment by asset category is as follows: December 31, 2016 December 31, 2015 (In thousands) Marine Vessels $ 1,789,942 $ 1,391,556 Construction Equipment 474,128 478,175 Buildings 152,584 155,292 All other 148,805 143,580 Construction in Progress 20,720 298,749 Total Cost $ 2,586,179 $ 2,467,352 Accumulated Depreciation (898,878 ) (856,493 ) Net Book Value $ 1,687,301 $ 1,610,859 |
EQUITY METHOD INVESTMENTS (Tabl
EQUITY METHOD INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity Method Investment Summarized Financial Information Equity [Abstract] | |
Summary of Financial Statement Information Under The Equity Method Investment | Summarized 100 percent balance sheet information for investments in equity method investees, combined, are set forth below: December 31, 2016 December 31, 2015 (In thousands) Current Assets $ 74,430 $ 133,171 Noncurrent Assets 124,862 189,536 Total Assets $ 199,292 $ 322,707 Current Liabilities $ 91,268 $ 176,165 Noncurrent Liabilities 86,963 112,162 Total Liabilities $ 178,231 $ 288,327 Summarized 100 percent income statement information for investments in equity method investees, combined, are set forth below: Year Ended December 31, 2016 2015 2014 (In thousands) Revenues $ 111,847 $ 107,795 $ 294,408 Cost of operations 87,335 105,465 275,015 Gross Profit 24,512 2,330 19,393 Net Income (loss) $ (8,609 ) $ (38,245 ) $ (28,773 ) |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt Obligations | As of December 31, 2016 and 2015 the carrying values of our long-term debt obligations, net of unamortized debt issuance costs of $14 million and $20 million, respectively, are as follows: December 31, 2016 December 31, 2015 (In thousands) Senior Notes $ 493,461 $ 491,890 Term Loan 212,070 289,979 North Ocean 105 construction financing 31,877 38,263 Amortizing Notes 7,932 21,205 Other, including capital lease obligation 7,180 2,546 752,520 843,883 Less: Amounts due within one year 48,125 24,882 Total long-term debt $ 704,395 $ 819,001 |
Maturities of Long-Term Debt During Five Years | Maturities of long-term debt during the five years subsequent to December 31, 2016 are as follows: (in thousands) 2017 $ 49,820 2018 3,427 2019 212,846 2020 - 2021 500,000 Total Debt $ 766,093 Debt Issuance Costs (13,573 ) Total Debt - Net of Issuance Costs $ 752,520 |
Summary of Redemption Prices Expressed as Percentage | At any time, or from time to time, on or after May 1, 2017, at our option, we may redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount of the Notes to be redeemed) Year Percentage 2017 104 % 2018 102 2019 and thereafter 100 |
PENSION AND POSTRETIREMENT BE38
PENSION AND POSTRETIREMENT BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Compensation And Retirement Disclosure [Abstract] | |
Obligations and Funded Status | Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2016 2015 (In thousands) Change in benefit obligation: Benefit obligation at beginning of year $ 519,199 $ 556,632 $ 38,265 $ 43,985 Interest cost 21,102 21,613 1,351 1,626 Actuarial loss (gain) 2,641 (21,754 ) (3,172 ) (4,095 ) Benefits paid (37,586 ) (37,292 ) (5,227 ) (3,251 ) Benefit obligation at end of year 505,356 519,199 31,217 38,265 Change in plan assets: Fair value of plan assets at beginning of year 494,146 551,821 38,257 42,106 Actual return on plan assets 26,891 (21,889 ) (778 ) (598 ) Company contributions 1,510 1,506 - - Benefits paid (37,586 ) (37,292 ) (5,227 ) (3,251 ) Fair value of plan assets at end of year 484,961 494,146 32,252 38,257 Funded status $ (20,395 ) $ (25,053 ) $ 1,035 $ (8 ) Amounts recognized in balance sheet consist of: Other Assets $ - $ - $ 1,035 $ - Accrued pension liability—current (1,382 ) (1,409 ) - - Pension liability (19,013 ) (23,644 ) - (8 ) Accrued benefit liability (20,395 ) (25,053 ) - (8 ) Net (Liability) Asset $ (20,395 ) $ (25,053 ) $ 1,035 $ (8 ) Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2016 2015 (In thousands) Supplemental information: Plans with accumulated benefit obligation in excess of plan assets Projected benefit obligation $ 505,356 $ 519,199 $ 31,217 $ 38,265 Accumulated benefit obligation 505,356 519,199 31,217 38,265 Fair value of plan assets 484,961 494,146 32,252 38,257 |
Weighted Average Assumptions used Determine Net Periodic Benefit Obligations | Assumptions Domestic Plans TCN Plan 2016 2015 2016 2015 Weighted average assumptions used to determine net periodic benefit obligations at December 31: Discount rate 4.1 % 4.2 % 4.1 % 4.0 % Rate of compensation increase N/A N/A N/A N/A |
Net Periodic Benefit Cost | Domestic Plans TCN Plan Year Ended December 31, Year Ended December 31, 2016 2015 2014 2016 2015 2014 (In thousands) Supplemental information: Components of periodic benefit cost: Interest cost $ 21,102 $ 21,613 $ 26,972 $ 1,351 $ 1,626 $ 1,900 Expected return on plan assets (20,006 ) (26,707 ) (27,501 ) (1,587 ) (2,840 ) (2,961 ) Actuarial loss (gain) (4,244 ) 26,842 (8,728 ) (807 ) (657 ) 6,027 Net periodic benefit cost (gain) $ (3,148 ) $ 21,748 $ (9,257 ) $ (1,043 ) $ (1,871 ) $ 4,966 Weighted average assumptions used to determine net periodic benefit cost: Discount rate 4.2 % 4.0 % 4.8 % 4.0 % 4.0 % 4.8 % Expected return on plan assets 4.2 % 5.0 % 5.0 % 4.7 % 6.9 % 6.9 % Rate of compensation increase N/A N/A N/A N/A N/A N/A |
Asset Allocations, by Asset Class | The following is a summary of the asset allocations at December 31, 2016 and 2015 by asset category. Domestic Plans TCN Plan 2016 2015 2016 2015 Asset Category: Fixed Income 85 % 85 % 67 % 49 % Equity Securities 15 15 33 51 Total 100 % 100 % 100 % 100 % |
Total Investments Plans Measured at Fair Value | The following is a summary of total investments for our plans, measured at fair value at: December 31, 2016 Level 1 Level 2 Level 3 Total Pension Benefits: (In thousands) Fixed Income $ 167,271 $ 247,882 $ 5,087 $ 420,240 Equities 82,442 - - 82,442 Cash and Accrued Items 14,531 - - 14,531 Total Investments $ 264,244 $ 247,882 $ 5,087 $ 517,213 December 31, 2015 Level 1 Level 2 Level 3 Total Pension Benefits: (In thousands) Fixed Income $ 60,128 $ 356,107 $ 5,752 $ 421,987 Equities 85,065 12 - 85,077 Cash and Accrued Items 25,335 4 - 25,339 Total Investments $ 170,528 $ 356,123 $ 5,752 $ 532,403 |
Changes in Level 3 Fixed Income Instrument Measured on Recurring Basis | The following is a summary of the changes in our Level 3 fixed income instruments measured on a recurring basis: December 31, 2016 2015 (In thousands) Balance at beginning of period $ 5,752 $ 5,013 Purchases, net 107 1,269 Total unrealized loss (772 ) (530 ) Balance at end of period $ 5,087 $ 5,752 |
Expected Employer Contributions and Expected Benefit Payments | Domestic Plans TCN Plan (In thousands) Expected employer contributions to trusts of defined benefit plans: 2017 $ - $ - Expected benefit payments: 2017 $ 37,148 $ 5,803 2018 36,929 1,304 2019 36,620 1,571 2020 36,228 1,799 2021 35,876 1,483 2022-2026 169,531 9,309 |
Summary of Contributions Under Defined Contribution Plans | The following table summarizes our contributions under the plans: Thrift Plan Global Thrift Plan Year Ended December 31, Year Ended December 31, 2016 2015 2014 2016 2015 2014 (In thousands) Contributions $ 4,176 $ 3,840 $ 3,879 $ 998 $ 1,095 $ 1,236 |
DERIVATIVE FINANCIAL INSTRUME39
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | The following table summarizes our asset and liability derivative financial instruments: December 31, 2016 2015 (In thousands) Derivatives Designated as Hedges: Location: Accounts receivable-other $ 2,631 $ 1,668 Other assets - 215 Total derivatives asset $ 2,631 $ 1,883 Accrued liabilities $ 9,361 $ 26,649 Other liabilities 4 4,018 Total derivatives liability $ 9,365 $ 30,667 |
Effects of Derivative Instruments on Consolidated Financial Statements | The following table summarizes the effects of derivative instruments on our Consolidated Financial Statements: December 31, 2016 2015 2014 (in thousands) Derivatives Designated as Hedges: Amount of gain (loss) recognized in other comprehensive income (loss) $ 4,004 $ (57,459 ) $ (65,503 ) Reclassified from AOCI to Cost of operations 34,556 76,034 26,418 Ineffective portion and amount excluded from effectiveness testing gain (loss) recognized in Gain (loss) on foreign currency, net (1,461 ) 6,238 6,910 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Outstanding Measured at Fair Value on Recurring and Nonrecurring Basis | The following table presents the financial instruments outstanding as of December 31, 2016 and 2015 that are measured at fair value on recurring basis and financial instruments that are not measured at fair value on a recurring basis. December 31, 2016 Carrying Amount Fair Value Level 1 Level 2 Level 3 (In thousands) Recurring Forward contracts $ (6,734 ) (6,734 ) $ - $ (6,734 ) $ - Non-recurring Debt (752,520 ) (777,072 ) - (728,072 ) (49,000 ) December 31, 2015 Carrying Amount Fair Value Level 1 Level 2 Level 3 (In thousands) Recurring Forward contracts $ (28,784 ) $ (28,784 ) $ - $ (28,784 ) $ - Non-recurring Debt (843,883 ) (777,634 ) - (707,492 ) (70,142 ) |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Total Stock-Based Compensation Expense Recognized | Total compensation expense recognized is as follows: 2016 2015 2014 (In thousands) Restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) $ 15,746 $ 14,395 $ 14,417 Performance shares and performance units 6,888 1,428 352 Stock options 46 770 1,747 Total $ 22,680 $ 16,593 $ 16,516 |
Total Gross Unrecognized Estimated Compensation Expense and Expected Weighted-Average Periods | The components of the total gross unrecognized estimated compensation expense for equity awards and their expected remaining weighted-average periods for expense recognition are as follows: Amount (In thousands) Weighted-Average Period (years) RSUs and RSAs $ 17,603 1.8 Performance shares and performance units (1) 258 0.3 $ 17,861 (1) |
Activity for Stock Option | The following table summarizes stock options activity during 2016 (share data in thousands): Number of Option Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Outstanding at beginning of period 2,896 $ 12.76 Cancelled/expired/forfeited (721 ) 8.65 Outstanding at end of period (1) 2,175 $ 14.13 1.94 years (1) |
Nonvested RSUs and RSAs and Changes | RSUs and RSAs and changes during 2016 were as follows (share data in thousands): Number of Shares Weighted-Average Grant Date Fair Value Nonvested at beginning of period 6,689 $ 5.15 Granted 3,876 3.28 Vested (3,524 ) 5.78 Cancelled/forfeited (868 ) 3.86 Nonvested at end of period 6,173 $ 3.80 |
Nonvested Performance Shares and Performance Unit Awards and Changes | Nonvested performance share awards and changes during 2016 were as follows (share data in thousands): Number of Shares Weighted-Average Grant Date Fair Value Nonvested at beginning of period 2,590 $ 6.71 Granted 1,582 3.22 Cancelled/forfeited (711 ) 10.22 Nonvested at end of period 3,461 $ 4.39 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Provision for income taxes | The provision for income taxes consisted of: Year Ended December 31, 2016 2015 2014 (In thousands) Other than U.S.: Current $ 43,944 $ 45,752 $ 21,619 Deferred (2,018 ) 6,211 (1,546 ) Total provision for income taxes $ 41,926 $ 51,963 $ 20,073 |
Geographic Source of Income Before Provision for Income Taxes | The geographic sources of income before income taxes are as follows: Year Ended December 31, 2016 2015 2014 (In thousands) U.S. (124,154 ) (99,738 ) (35,782 ) Other than U.S. 206,469 164,348 (1,691 ) Income before provision for income taxes $ 82,315 $ 64,610 $ (37,473 ) |
Reconciliation of Panama Statutory Federal Tax Rate to Consolidated Effective Tax Rate | The following is a reconciliation of the Panama statutory federal tax rate to the consolidated effective tax rate: Year Ended December 31, 2016 2015 2014 Panama federal statutory rate 25 % 25 % 25 % Non-Panama operations (14 ) 29 9 Valuation allowance for deferred tax assets 24 10 (105 ) Audit settlements and reserves 14 9 17 Other (primarily tax on unremitted earnings) 2 7 - Effective tax rate attributable to continuing operations 51 % 80 % (54 )% |
Significant Components of Deferred Tax Assets and Liabilities | Significant components of deferred tax assets and liabilities were as follows: December 31, 2016 2015 (In thousands) Deferred tax assets: Pension liability $ 9,732 $ 12,033 Accrued liabilities for incentive compensation 22,208 21,640 Net operating loss carryforward 349,916 325,636 State net operating loss carryforward 18,308 24,367 Long-term contracts - 4,312 Other 1,861 2,060 Total deferred tax assets 402,025 390,048 Valuation allowance for deferred tax assets (334,991 ) (336,146 ) Deferred tax assets $ 67,034 $ 53,902 Deferred tax liabilities: Property, plant and equipment 37,883 34,419 Prepaid drydock 1,367 7,639 Long-term contracts 10,989 - Investments in joint ventures and affiliated companies 17,044 14,960 Unrealized exchange gains and other 3,335 3,163 Total deferred tax liabilities $ 70,618 $ 60,181 Net deferred tax liability $ (3,584 ) $ (6,279 ) December 31, 2016 2015 (In thousands) Deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets include: Deferred tax assets $ 21,116 $ 18,822 Deferred tax liabilities 24,700 25,101 Net deferred tax liability $ (3,584 ) $ (6,279 ) |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of unrecognized tax benefits is as follows: Year Ended December 31, 2016 2015 2014 (in thousands) Balance at beginning of period $ 36,353 $ 34,106 $ 40,613 Increases based on tax positions taken in the current year 2,328 4,720 3,479 Increases based on tax positions taken in prior years 7,741 4,710 3,195 Decreases based on tax positions taken in prior years (5,090 ) (2,836 ) (863 ) Decreases due to lapse of applicable statute of limitation (310 ) (4,347 ) (12,318 ) Balance at end of period $ 41,022 $ 36,353 $ 34,106 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, 2016 2015 2014 (In thousands, except share and per share amounts) Net income (loss) attributable to McDermott International, Inc. $ 34,117 $ (17,983 ) $ (75,994 ) Weighted average common stock (basic) 240,359,363 238,240,763 237,229,086 Effect of dilutive securities: Tangible equity units 40,824,938 - - Stock options, restricted stock and restricted stock units 2,999,938 - - Potential dilutive common stock 284,184,239 238,240,763 237,229,086 Net income (loss) per share Net income (loss) attributable to McDermott International, Inc. Basic: $ 0.14 $ (0.08 ) $ (0.32 ) Diluted: $ 0.12 $ (0.08 ) $ (0.32 ) |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Changes in the Number of Ordinary Shares Outstanding and Treasury Shares Held by the Company | The changes in the number of ordinary shares outstanding and treasury shares held by the Company are as follows: Year Ended December 31, 2016 2015 Shares outstanding Beginning balance 239,016,924 237,809,823 Common stock issued 3,304,808 1,672,923 Purchase of common stock (933,455 ) (465,822 ) Ending balance 241,388,277 239,016,924 Shares held as Treasury shares Beginning balance 7,824,204 7,400,027 Purchase of common stock 933,455 465,822 Retirement of common stock (455,655 ) (41,645 ) Ending balance 8,302,004 7,824,204 Ordinary shares issued at the end of the period 249,690,281 246,841,128 |
Reclassifications [Member] | |
Accumulated Other Comprehensive Income Loss [Line Items] | |
Components of Accumulated Other Comprehensive Income (Loss) Included in Stockholders' Equity | The components of AOCI included in stockholders’ equity are as follows: December 31, 2016 December 31, 2015 (In thousands) Foreign currency translation adjustments ("FCTA") $ (42,082 ) $ (29,925 ) Net unrealized gain on investments 269 247 Net loss on derivative financial instruments (25,082 ) (64,277 ) Accumulated other comprehensive loss $ (66,895 ) $ (93,955 ) The following table presents the components of AOCI and the amounts that were reclassified during 2016, 2015 and 2014: Foreign currency translation adjustments Unrealized holding gain (loss) on investments Gain (loss) on derivative (1) TOTAL (In thousands) Balance, January 1, 2014 $ (2,562 ) $ 238 $ (45,386 ) $ (47,710 ) Other comprehensive income (loss) before reclassification (9,250 ) 3 (65,503 ) (74,750 ) Amounts reclassified from AOCI (3,400 ) - 28,052 (2) 24,652 Net current period other comprehensive income (loss) (12,650 ) 3 (37,451 ) (50,098 ) Balance, December 31, 2014 (15,212 ) 241 (82,837 ) (97,808 ) Other comprehensive income (loss) before reclassification (12,470 ) 6 (57,459 ) (69,923 ) Amounts reclassified from AOCI (2,243 ) - 76,019 (2) 73,776 Net current period other comprehensive income (loss) (14,713 ) 6 18,560 3,853 Balance, December 31, 2015 (29,925 ) 247 (64,277 ) (93,955 ) Other comprehensive income (loss) before reclassification (12,157 ) 22 4,004 (8,131 ) Amounts reclassified from AOCI - - 35,191 (2) 35,191 Net current period other comprehensive income (loss) (12,157 ) 22 39,195 27,060 Balance, December 31, 2016 $ (42,082 ) $ 269 $ (25,082 ) $ (66,895 ) (1) Refer to Note 12, Derivative Financial Instruments, for additional details (2) Reclassified to cost of operations and gain (loss) on foreign currency, net |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Payments Required under Operating Leases that have Initial or Remaining Non-cancellable Lease Terms in Excess of One Year | Future minimum payments required under operating leases that have initial or remaining non-cancellable lease terms in excess of one year at December 31, 2016 are as follows (in thousands): Fiscal Year Ending December 31, Amount 2017 $ 27,864 2018 23,185 2019 19,076 2020 19,208 2021 14,425 Thereafter 122,922 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Information about Operations in Different Segments | 1. Year Ended December 31, 2016 2015 2014 (In thousands) Revenues (1) AEA $ 285,988 $ 478,800 $ 567,608 MEA 1,241,591 1,134,555 795,666 ASA 1,108,404 1,456,920 937,615 Total revenues: $ 2,635,983 $ 3,070,275 $ 2,300,889 Income (loss) before provision for income taxes: Operating income (loss) (2) AEA $ 51,129 $ 52,918 $ (65,565 ) MEA 209,401 146,866 47,863 ASA 97,963 123,718 90,838 Segment operating income 358,493 323,502 73,136 Corporate and Other (216,240 ) (210,820 ) (56,734 ) Total operating income $ 142,253 $ 112,682 $ 16,402 Interest expense, net (58,871 ) (50,058 ) (60,877 ) Other non-operating income (expense), net (1,067 ) 1,986 7,002 Income (loss) before provision for income taxes $ 82,315 $ 64,610 $ (37,473 ) Capital expenditures (3) AEA $ 16,667 $ 13,715 $ 53,431 MEA 18,564 28,328 99,974 ASA 190,260 60,220 154,735 Corporate and Other 2,588 588 13,047 Total capital expenditures: $ 228,079 $ 102,851 $ 321,187 Depreciation and amortization: AEA $ 26,924 $ 43,006 $ 34,494 MEA 24,268 30,567 31,876 ASA 30,314 16,880 19,020 Corporate and Other 8,376 9,881 7,795 Total depreciation and amortization: $ 89,882 $ 100,334 $ 93,185 Drydock amortization AEA $ 9,905 $ 12,554 $ 11,453 MEA 1,975 2,089 2,011 ASA 915 3,304 6,255 Total drydock amortization $ 12,795 $ 17,947 $ 19,719 (1) Intercompany transactions were not significant during 2016, 2015 and 2014. (2) The 2016 and 2015 Corporate and Other operating results include $55 million and $7 million of impairment, respectively. The 2014 Corporate and Other operating results include $11 million of improvements to the cancellation cost estimate included in the $38 million vessel impairment charge recognized in 2013. See Note 13, Fair Value Measurements, for further discussion. (3) Total capital expenditures represent expenditures for which cash payments were made during the period. Capital expenditures for 2016, 2015 and 2014 include $4 million, $14 million and $27 million of cash payments for accrued capital expenditures outstanding as of December 31, 2015, 2014 and 2013, respectively. |
Significant Impact of Customers on Company Segments | 2. Information about our most significant Customers Our significant customers by segments during 2016, 2015 and 2014, were as follows: % of Consolidated Reportable Revenues Segment Year Ended December 31, 2016: Inpex Operations Australia Pty Ltd 33% ASA Saudi Aramco 26% MEA RasGas Company Limited 12% MEA Year Ended December 31, 2015: Inpex Operations Australia Pty Ltd 36% ASA Saudi Aramco 28% MEA Year Ended December 31, 2014: Saudi Aramco 27% MEA Inpex Operations Australia Pty Ltd 25% ASA |
Information about Service Lines and Operations in Different Geographic Areas | 3. Information about our Service Lines and Operations in Different Geographic Areas: Year Ended December 31, 2016 2015 2014 (In thousands) Service line revenues: Installation Operations $ 1,074,069 $ 1,256,412 $ 1,041,525 Procurement Activities 879,222 1,123,329 677,734 Project Services and Engineering Operations 356,781 416,906 314,776 Fabrication Operations 325,911 273,628 266,854 $ 2,635,983 $ 3,070,275 $ 2,300,889 Geographic revenues: Australia $ 881,812 $ 1,157,723 $ 614,164 Saudi Arabia 767,119 900,483 616,659 Qatar 419,963 46,873 - Mexico 112,484 247,859 130,642 Russia 108,392 - - United States 95,996 32,858 148,606 Trinidad 67,757 - - India 56,027 - - United Arab Emirates 54,392 185,606 57,249 Malaysia 22,637 - 98,004 Indonesia 21,726 54,288 150,205 Brunei - 237,337 - Brazil 6,449 183,656 290,561 Azerbaijan - - 111,382 Other countries 21,229 23,592 83,417 $ 2,635,983 $ 3,070,275 $ 2,300,889 |
Information about Segment Assets and Property, Plant and Equipment by Country | 4. Information about our Segment Assets and Property, Plant and Equipment by Country: Year Ended December 31, 2016 2015 (In thousands) Segment assets: AEA $ 727,328 $ 896,822 MEA 907,936 971,170 ASA 976,470 774,365 Corporate and Other 610,496 744,719 Total assets $ 3,222,230 $ 3,387,076 Property, plant and equipment, net (1) Australia $ 626,605 $ - Mexico 603,185 96,090 United Arab Emirates 318,822 341,502 United States 27,482 561,990 Saudi Arabia 22,608 4,522 Indonesia 73,213 521,922 India 10,666 307 Malaysia 2,457 49,609 Brazil 170 31,765 Other countries 2,093 3,152 Total property, plant and equipment, net $ 1,687,301 $ 1,610,859 ( 1) Our marine vessels are included in the country in which they were located as of year-end. |
Other Information about Segment | 5. Information about our Unconsolidated Affiliates: Year Ended December 31, 2016 2015 2014 (In thousands) Equity in loss of unconsolidated affiliates: AEA $ (5,082 ) $ (6,255 ) $ 4,829 MEA - (94 ) (2,668 ) ASA 1,167 (15,137 ) (10,009 ) Corporate and Other (175 ) - - Total equity in loss of unconsolidated affiliates: $ (4,090 ) $ (21,486 ) $ (7,848 ) Investments in unconsolidated affiliates: AEA $ 2,449 $ 1,540 ASA 14,064 24,327 Corporate and Other 510 684 Total investments in unconsolidated affiliates $ 17,023 $ 26,551 |
QUARTERLY FINANCIAL DATA (UNA47
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Unaudited Quarterly Financial Information | The following tables set forth selected unaudited quarterly financial information for the quarterly periods in 2016 and 2015: For the Quarter Ended March 31 (1) June 30 (2) September 30 (3) December 31 (4) 2016 (In thousands, except per share data amounts) Revenues $ 729,032 $ 706,627 $ 558,543 $ 641,781 Gross Profit 112,999 111,185 103,044 59,139 Net income (loss) (2,444 ) 21,805 16,392 546 Net income (loss) attributable to non-controlling interest (272 ) 1,148 284 1,022 Net income (loss) attributable to McDermott International, Inc. (2,172 ) 20,657 16,108 (476 ) Income (loss) per share (5) Basic (0.01 ) 0.09 0.07 0.00 Diluted (0.01 ) 0.07 0.06 0.00 (1) (2) (3) (4) (5) For the Quarter Ended March 31 (1) June 30 (2) September 30 (3) December 31 (4) 2015 (In thousands, except per share data amounts) Revenues $ 550,463 $ 1,046,537 $ 805,857 $ 667,418 Gross Profit 75,004 121,015 84,896 98,076 Net income (loss) (12,048 ) 13,690 7,534 (18,015 ) Net income attributable to non-controlling interest 2,459 2,164 3,868 653 Net income (loss) attributable to McDermott International, Inc. (14,507 ) 11,526 3,666 (18,668 ) Income (loss) per share (5) Basic (0.06 ) 0.05 0.02 (0.08 ) Diluted (0.06 ) 0.04 0.01 (0.08 ) (1) Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. (2) Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. (3) Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. (4) Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. (5) |
Basis of Presentation and Sig48
Basis of Presentation and Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2016CountrySegment | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Number of countries | Country | 20 |
Number of reportable segments | Segment | 3 |
Percentage of completion to recognize expected profit | 70.00% |
Building [Member] | Minimum [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Property, plant and equipment economic useful lives | 8 years |
Building [Member] | Maximum [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Property, plant and equipment economic useful lives | 33 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Property, plant and equipment economic useful lives | 3 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Property, plant and equipment economic useful lives | 28 years |
Other Capitalized Property Plant And Equipment | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |
Property, plant and equipment economic useful lives | 5 years |
Revenue Recognition - Percentag
Revenue Recognition - Percentage of Revenues by Contract Type (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | |||
Percentage of revenue | 100.00% | 100.00% | 100.00% |
Fixed-Price [Member] | |||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | |||
Percentage of revenue | 92.00% | 93.00% | 87.00% |
Unit-Basis and Other [Member] | |||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | |||
Percentage of revenue | 8.00% | 7.00% | 13.00% |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | [2] | Jun. 30, 2016USD ($) | [3] | Mar. 31, 2016USD ($) | [4] | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | [6] | Jun. 30, 2015USD ($) | [7] | Mar. 31, 2015USD ($) | [8] | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)Project | Dec. 31, 2014USD ($) | ||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Unapproved change orders | $ 119,000,000 | $ 122,000,000 | $ 119,000,000 | $ 122,000,000 | ||||||||||||||||||
Revenues | 641,781,000 | [1] | $ 558,543,000 | $ 706,627,000 | $ 729,032,000 | 667,418,000 | [5] | $ 805,857,000 | $ 1,046,537,000 | $ 550,463,000 | 2,635,983,000 | [9] | 3,070,275,000 | [9] | $ 2,300,889,000 | [9] | ||||||
Loss on contracts | 22,000,000 | |||||||||||||||||||||
Mexico [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Revenues | 112,484,000 | 247,859,000 | 130,642,000 | |||||||||||||||||||
Brazil [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Revenues | 6,449,000 | $ 183,656,000 | 290,561,000 | |||||||||||||||||||
Charter contract term | 5 years | |||||||||||||||||||||
MEA [Member] | Unconsolidated joint ventures [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Revenues | 0 | $ 0 | $ 0 | |||||||||||||||||||
MEA [Member] | Claims Revenue [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Revenues | 10,000,000 | 10,000,000 | ||||||||||||||||||||
Backlog [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Unapproved change orders | $ 15,000,000 | $ 21,000,000 | 15,000,000 | $ 21,000,000 | ||||||||||||||||||
Backlog [Member] | AEA [Member] | Mexico [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Project completion year | 2,016 | |||||||||||||||||||||
Active EPCI Project [Member] | MEA [Member] | KJO Hout Project [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Loss on contracts | $ 8,000,000 | |||||||||||||||||||||
Project completion year | 2,017 | |||||||||||||||||||||
Active Projects [Member] | AEA [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Number of projects accounted under deferred profit recognition policy | Project | 2 | |||||||||||||||||||||
Backlog Associated with Charter of Agile [Member] | AEA [Member] | Brazil [Member] | ||||||||||||||||||||||
Revenue Recognition Multiple Deliverable Arrangements [Line Items] | ||||||||||||||||||||||
Project termination year | 2,016 | |||||||||||||||||||||
[1] | Net loss for the quarter ended December 31, 2016 was primarily due to increase in our estimated costs at completion on our Ichthys project in Australia and an impairment charge on the Intermac 600. Those were partially offset by productivity improvements and associated cost savings, primarily in our MEA segment. | |||||||||||||||||||||
[2] | Net income for the quarter ended September 30, 2016 was influenced by productivity improvements and associated cost savings, primarily in the MEA and ASA segments, partially offset by impairment losses on certain marine assets. | |||||||||||||||||||||
[3] | Net income for the quarter ended June 30, 2016 was influenced by productivity improvements and associated cost savings in the MEA and ASA segments. | |||||||||||||||||||||
[4] | Net loss for the quarter ended March 31, 2016 was influenced by successful execution and close-out improvements in the AEA segment and productivity improvements and associated cost savings, primarily in the ASA segment, partially offset by impairment losses on the Agile vessel. | |||||||||||||||||||||
[5] | Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. | |||||||||||||||||||||
[6] | Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. | |||||||||||||||||||||
[7] | Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. | |||||||||||||||||||||
[8] | Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. | |||||||||||||||||||||
[9] | Intercompany transactions were not significant during 2016, 2015 and 2014. |
Use of Estimates - Additional I
Use of Estimates - Additional Information (Detail) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2017USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)Project | Dec. 31, 2014USD ($) | |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | $ 91 | $ 70 | |||
Effect of additional estimated project costs On Income | 10 | ||||
Subsequent Event [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | $ 34 | ||||
AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 38 | 27 | $ 37 | ||
MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 38 | $ 20 | 4 | ||
Number of projects | Project | 2 | ||||
ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 15 | $ 23 | 10 | ||
PB Litoral project [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 7 | 12 | |||
KJO Hout Project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 9 | ||||
Loss position in estimated cost of project | 8 | ||||
Ichthys Project [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Partial offset on estimated costs on project | $ 31 | ||||
Benefit from project execution cost saving | 5 | ||||
Agile Charter [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Favorable changes due to productivity improvements and cost reduction initiatives | 11 | ||||
Other Multiple Projects [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 4 | ||||
Other Multiple Projects [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 7 | ||||
Other Multiple Projects [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 14 | ||||
Abu Ali cable lay project | MEA [Member] | Project One [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 24 | ||||
ADMA Four GI Project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Partial offset on estimated costs on project | 20 | ||||
Gorgon MRU Project [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | $ 4 | ||||
PB Litoral an EPCI Project [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 69 | ||||
Jack & St. Malo [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 6 | ||||
Morgan City Fabrication Project [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | (8) | ||||
Papa Terra Project [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 40 | ||||
Marine Installation Project [Member] | AEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | (5) | ||||
Safaniya phase two Saudi Aramco EPCI project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | $ 20 | 23 | |||
Partial offset on estimated costs on project | 43 | ||||
Safaniya phase one Saudi Aramco project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 19 | ||||
KJO Ratawi project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 12 | ||||
Caspian Pipelay project [Member] | MEA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 54 | ||||
Siakap [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 52 | ||||
Siakap project [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 34 | ||||
Brunei Project [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 12 | ||||
Sepat FEED and Esso KIT Project [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | 6 | ||||
Ichthys Project in Australia [Member] | ASA [Member] | |||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||
Effect of changes in estimated project cost on operating results | $ 11 |
Restructuring - Restructuring C
Restructuring - Restructuring Costs Incurred and Future Cost Expected to be Incurred (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | $ 11,263 | $ 40,819 | $ 18,113 | |
Incurred from inception to December 31, 2016 | 105,922 | |||
Americas Restructuring [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | (1,350) | [1] | 2,308 | 9,170 |
Incurred from inception to December 31, 2016 | 44,194 | |||
Corporate Restructuring [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 4,940 | |||
Incurred from inception to December 31, 2016 | 6,601 | |||
MPI [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 5,248 | 37,711 | 4,003 | |
Incurred from inception to December 31, 2016 | 46,962 | |||
MPI [Member] | Severance and other personnel-related costs [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 2,590 | 15,217 | ||
Incurred from inception to December 31, 2016 | 17,807 | |||
MPI [Member] | Asset impairment and disposal [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 7,471 | |||
Incurred from inception to December 31, 2016 | 7,471 | |||
MPI [Member] | Legal and other advisor fees [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 222 | 7,414 | $ 4,003 | |
Incurred from inception to December 31, 2016 | 11,639 | |||
MPI [Member] | Other [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 2,436 | 7,609 | ||
Incurred from inception to December 31, 2016 | 10,045 | |||
AOR [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 7,365 | 800 | ||
Incurred from inception to December 31, 2016 | 8,165 | |||
AOR [Member] | Severance and other personnel-related costs [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 5,012 | |||
Incurred from inception to December 31, 2016 | 5,012 | |||
AOR [Member] | Legal and other advisor fees [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 1,968 | $ 800 | ||
Incurred from inception to December 31, 2016 | 2,768 | |||
AOR [Member] | Other [Member] | ||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | ||||
Incurred for the period | 385 | |||
Incurred from inception to December 31, 2016 | $ 385 | |||
[1] | This amount includes reversal of environmental liability established in connection with discontinued utilization of our Morgan City fabrication facility. For further discussion see, Note 18, Commitments and Contingencies. |
Cash, Cash Equivalents and Re53
Cash, Cash Equivalents and Restricted Cash - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Cash And Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 595,921 | $ 664,844 | ||
Restricted cash and cash equivalents | 16,412 | 116,801 | ||
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows | $ 612,333 | $ 781,645 | $ 852,894 | $ 142,354 |
Accounts Receivable - Contract
Accounts Receivable - Contract Receivables (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounts Notes And Loans Receivable [Line Items] | |||
Retainages | $ 58,431 | $ 17,896 | |
Accounts receivable—trade, net | 334,384 | 208,474 | |
Contract receivables [Member] | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Contracts receivable | 245,604 | 164,898 | |
Unbilled | [1] | 4,303 | 4,303 |
Less allowances | (14,299) | (14,325) | |
Accounts receivable—trade, net | 334,384 | 208,474 | |
Contract receivables [Member] | Completed contracts [Member] | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Contracts receivable | $ 40,345 | $ 35,702 | |
[1] | This amount relates to a project milestone billing for which we are awaiting the customer’s final acceptance certificate. We expect to receive the final acceptance certificate during 2017. |
Accounts Receivable - Retainage
Accounts Receivable - Retainages on Contracts (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Receivables [Abstract] | ||
Retainages expected to be collected within one year | $ 58,431 | $ 17,896 |
Retainages expected to be collected after one year | 127,193 | 155,061 |
Total retainages | $ 185,624 | $ 172,957 |
Accounts Receivable - Additiona
Accounts Receivable - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounts Notes And Loans Receivable [Line Items] | ||
Retainages expected to be collected in 2018 | $ 121,000,000 | |
Retainages expected to be collected in 2019 | 6,000,000 | |
Allowance for doubtful accounts | $ 0 | $ 0 |
Maximum [Member] | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Employee receivables expected collection months | 12 months |
Accounts Receivable - Summary o
Accounts Receivable - Summary of Accounts Receivable Other (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Receivables [Abstract] | ||
Receivables from unconsolidated affiliates | $ 13,292 | $ 12,816 |
Accrued unbilled other | 12,075 | 14,021 |
Employee receivables | 4,730 | 4,376 |
Other taxes receivable | 2,483 | 28,743 |
Other | 4,349 | 6,733 |
Accounts receivable—other | $ 36,929 | $ 66,689 |
Contracts in Progress and Adv58
Contracts in Progress and Advance Billings on Contracts - Components of Contracts in Progress and Advance Billings on Contracts (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Contractors [Abstract] | ||
Costs incurred less costs of revenue recognized | $ 119,688 | $ 112,819 |
Revenues recognized less billings to customers | 199,450 | 323,010 |
Contracts in Progress | 319,138 | 435,829 |
Billings to customers less revenue recognized | 42,637 | 265,618 |
Costs incurred less costs of revenue recognized | 149,849 | (100,845) |
Advance Billings on Contracts | $ 192,486 | $ 164,773 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property Plant Equipment by Asset Category (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | $ 2,586,179 | $ 2,467,352 | |
Less accumulated depreciation | (898,878) | (856,493) | |
Property, plant and equipment, net | [1] | 1,687,301 | 1,610,859 |
Marine Vessels [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | 1,789,942 | 1,391,556 | |
Construction Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | 474,128 | 478,175 | |
Building [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | 152,584 | 155,292 | |
All other [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | 148,805 | 143,580 | |
Construction in Progress [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property, Plant and Equipment | $ 20,720 | $ 298,749 | |
[1] | Our marine vessels are included in the country in which they were located as of year-end. |
Property, Plant and Equipment60
Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2014 | Apr. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Abstract] | |||||
Interest incurred | $ 75 | $ 74 | $ 85 | ||
Interest capitalized | 14 | 23 | 24 | ||
Depreciation expense | $ 90 | $ 100 | 93 | ||
Proceeds from Assets Sale | $ 14 | $ 32 | 25 | ||
Gain from Assets Sale | 11 | $ 25 | 11 | ||
Property plant and equipment improvement | $ 1 | $ 11 |
Equity Method Investments - Add
Equity Method Investments - Additional Information (Detail) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($)EquityMethodInvestee | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Schedule Of Equity Method Investments [Line Items] | ||||
Number of equity method investees are listed on stock exchange | EquityMethodInvestee | 0 | |||
Other non-operating income (expense), net | $ (1,067) | $ 1,986 | $ 7,002 | |
THHE Fabricators Sdn. Bhd [Member] | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Decrease in investments in unconsolidated affiliates | 12,000 | |||
Other non-operating income (expense), net | $ 5,000 | |||
THHE Fabricators Sdn. Bhd [Member] | ASA Segment [Member] | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Decrease in investments in unconsolidated affiliates | $ 12,000 | |||
Other non-operating income (expense), net | $ 5,000 |
Summary of Balance Sheet Inform
Summary of Balance Sheet Information Under The Equity Method Investment (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Equity Method Investment Summarized Financial Information [Abstract] | ||
Current Assets | $ 74,430 | $ 133,171 |
Noncurrent Assets | 124,862 | 189,536 |
Total Assets | 199,292 | 322,707 |
Current Liabilities | 91,268 | 176,165 |
Noncurrent Liabilities | 86,963 | 112,162 |
Total Liabilities | $ 178,231 | $ 288,327 |
Summary of Income Statement Inf
Summary of Income Statement Information Under The Equity Method Investment (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Equity Method Investment Summarized Financial Information Income Statement [Abstract] | |||
Revenues | $ 111,847 | $ 107,795 | $ 294,408 |
Cost of operations | 87,335 | 105,465 | 275,015 |
Gross Profit | 24,512 | 2,330 | 19,393 |
Net Income (loss) | $ (8,609) | $ (38,245) | $ (28,773) |
Debt - Additional Information (
Debt - Additional Information (Detail) | May 13, 2016USD ($) | May 12, 2016 | Jan. 31, 2017USD ($) | Apr. 30, 2014USD ($)$ / EquityUnitsshares | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016USD ($)$ / shares | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Apr. 30, 2016USD ($) | Apr. 18, 2016USD ($) | Feb. 29, 2016USD ($) | Oct. 31, 2015USD ($) | Sep. 30, 2010 |
Debt Instrument [Line Items] | ||||||||||||||||||||
Unamortized debt issuance costs | $ 13,573,000 | $ 13,573,000 | $ 20,000,000 | |||||||||||||||||
Excess cash flow | 50.00% | |||||||||||||||||||
Aggregate principal amount of unreimbursed drawings and advances under line of credit facility | 6.4 | 6.4 | ||||||||||||||||||
Units issued | shares | 11,500,000 | |||||||||||||||||||
Tangible units interest rate percentage | 6.25% | |||||||||||||||||||
Unit price per share | $ / EquityUnits | 25 | |||||||||||||||||||
Initial principal amount per amortizing note | $ / EquityUnits | 4.1266 | |||||||||||||||||||
Issuance of tangible equity units | $ 240,044,000 | |||||||||||||||||||
Maximum settlement rate per tangible equity unit | $ / shares | $ 3.5562 | $ 3.5562 | ||||||||||||||||||
Dilutive common shares issuable under common stock purchase contracts | shares | 40,900,000 | |||||||||||||||||||
Conversion price per share | $ / shares | $ 0.0703 | $ 0.0703 | ||||||||||||||||||
Bank guarantees issued | $ 359,000,000 | $ 359,000,000 | 118,000,000 | |||||||||||||||||
Bonds issued related to JRMSA general agreement of indemnity | 79,000,000 | 79,000,000 | 54,000,000 | |||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Line of Credit facility maximum amount outstanding | $ 525,000,000 | |||||||||||||||||||
Increase in bank guarantees overall capacity | $ 150,000,000 | |||||||||||||||||||
Notes Payable Current [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Tangible equity units, aggregate principal amount | $ 9,000,000 | $ 9,000,000 | ||||||||||||||||||
Senior Amortizing Note Due April 1, 2017 | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Debt instrument maturity date | Apr. 1, 2017 | |||||||||||||||||||
Amortizing note interest rate percentage | 7.75% | |||||||||||||||||||
Financial Letter of Credit [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Letter of credit fee | 4.50% | 4.50% | ||||||||||||||||||
Minimum [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Aggregate principal amount of unreimbursed drawings and advances under line of credit facility | 1.75 | 1.75 | ||||||||||||||||||
Dilutive common shares issuable under common stock purchase contracts | shares | 33,400,000 | |||||||||||||||||||
Conversion price per share | $ / shares | $ 0.0861 | $ 0.0861 | ||||||||||||||||||
Dilutive common shares issuable under common stock purchase contracts, per unit | $ / shares | $ 2.9030 | $ 2.9030 | ||||||||||||||||||
After March 31, 2016 But Before April 16, 2017 | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Aggregate amount | $ 25,000,000 | |||||||||||||||||||
Prior to April 16, 2017 [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Dividends to MDR stockholders | $ 50,000,000 | $ 50,000,000 | ||||||||||||||||||
After April 16, 2017 [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Dividends to MDR stockholders | 150,000,000 | $ 150,000,000 | ||||||||||||||||||
Senior Notes [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Issue of second-lien seven-year senior secured notes | $ 500,000,000 | |||||||||||||||||||
Tangible equity units, aggregate principal amount | 48,000,000 | |||||||||||||||||||
Debt instrument interest rate | 8.00% | |||||||||||||||||||
Debt instrument maturity date | May 1, 2021 | |||||||||||||||||||
Issuance of tangible equity units | $ 240,000,000 | |||||||||||||||||||
Letter of Credit Facility [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Letter of credit, first lien | $ 450,000,000 | 400,000,000 | $ 450,000,000 | $ 450,000,000 | 520,000,000 | $ 520,000,000 | ||||||||||||||
Debt instrument maturity year | 2,017 | |||||||||||||||||||
Minimum fixed charge coverage ratio | 1.15% | |||||||||||||||||||
Maximum Leverage Ratio | 4.50% | 4.50% | 4.50% | 4.50% | ||||||||||||||||
Maximum leverage ratio, there after | 3.50% | 3.50% | ||||||||||||||||||
Debt instrument covenant maximum capital expenditures | $ 250,000,000 | 125,000,000 | ||||||||||||||||||
Debt instrument covenant maximum capital expenditures thereafter | $ 375,000,000 | |||||||||||||||||||
Line of credit facility, description | extend the maturity date of the LC Facility commitments to April 22, 2019, unless the Term Loan has not been repaid or refinanced by January 15, 2019, in which case the LC Facility commitments will expire on January 15, 2019; | |||||||||||||||||||
Line of credit, extended maturity date | Apr. 22, 2019 | |||||||||||||||||||
Line of credit, expiration date | Jan. 15, 2019 | |||||||||||||||||||
Line of Credit facility maximum amount outstanding | $ 442,000,000 | 384,000,000 | ||||||||||||||||||
Cash collateralize letter of credit permitted to deposit, Amount | $ 300,000,000 | 300,000,000 | ||||||||||||||||||
Cash collateralized letters of credit | 175,000,000 | 175,000,000 | ||||||||||||||||||
Letter of credit supported by Cash collateral | $ 16,000,000 | $ 16,000,000 | 102,000,000 | |||||||||||||||||
Commitment fee on the unused portion of credit agreement | 0.50% | |||||||||||||||||||
Letter of Credit Facility [Member] | Middle Eastern Bank [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Letter of credit, first lien | $ 200,000,000 | |||||||||||||||||||
Line of Credit facility maximum amount outstanding | $ 375,000,000 | |||||||||||||||||||
Letter of Credit Facility [Member] | Maximum [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Secured leverage ratio | 2.00% | 2.00% | 2.00% | 2.00% | ||||||||||||||||
Secured leverage ratio thereafter | 1.50% | |||||||||||||||||||
Letter of Credit Facility [Member] | Scenario Forecast [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Maximum Leverage Ratio | 4.00% | 4.00% | 4.50% | 4.50% | ||||||||||||||||
Letter of Credit Facility [Member] | Scenario Forecast [Member] | Maximum [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Secured leverage ratio | 2.00% | 2.00% | 2.00% | 2.00% | ||||||||||||||||
Term Loan [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Letter of credit, first lien | 300,000,000 | |||||||||||||||||||
Debt instrument maturity year | 2,019 | |||||||||||||||||||
Increased applicable margin payable on term loan | 3.00% | |||||||||||||||||||
Prepayment of Term Loan under credit agreement | 75,000,000 | |||||||||||||||||||
Term Loan amortization amount | $ 750,000,000 | |||||||||||||||||||
Term Loan [Member] | Maximum [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Reinvestment period | 365 days | |||||||||||||||||||
Term Loan [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Base rate and applicable margin | 7.25% | |||||||||||||||||||
Term Loan [Member] | Maximum [Member] | Base Rate [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Base rate and applicable margin | 6.25% | |||||||||||||||||||
Term Loan [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Base rate and applicable margin | 1.00% | |||||||||||||||||||
Term Loan [Member] | Minimum [Member] | Base Rate [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Base rate and applicable margin | 2.00% | |||||||||||||||||||
Tangible Equity Units | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Issue of tangible equity units | $ 288,000,000 | |||||||||||||||||||
DLV 2000 [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Increase decrease in indebtedness | 150,000,000 | $ 20,000,000 | ||||||||||||||||||
DLV 2000 [Member] | Maximum [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Covenant acquisition limit | 150,000,000 | |||||||||||||||||||
Prepayment or purchase of junior priority debt covenant limit | $ 100,000,000 | |||||||||||||||||||
Performance Stand By Letters Of Credit | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Letter of credit fee | 2.25% | 2.25% | ||||||||||||||||||
North Ocean 105 [Member] | North Ocean Construction Financing [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Debt instrument maturity date | Jun. 30, 2017 | |||||||||||||||||||
Amortizing note interest rate percentage | 4.00% | 4.00% | ||||||||||||||||||
Dividend declared | $ 5,000,000 | |||||||||||||||||||
Converted notes payable | $ 5,000,000 | $ 5,000,000 | ||||||||||||||||||
North Ocean 105 [Member] | Secured Debt [Member] | North Ocean Construction Financing [Member] | ||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||
Percentage of interest acquired in subsidiary | 75.00% | |||||||||||||||||||
Ownership percentage in Oceanteam ASA's | 25.00% |
Debt - Summary of Long-Term Deb
Debt - Summary of Long-Term Debt Obligations (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Long-term borrowing | $ 752,520 | $ 843,883 |
Less: Amounts due within one year | 48,125 | 24,882 |
Long-term debt | 704,395 | 819,001 |
Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term borrowing | 493,461 | 491,890 |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Long-term borrowing | 212,070 | 289,979 |
Amortizing Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term borrowing | 7,932 | 21,205 |
Other, Including Capital Lease Obligation [Member] | ||
Debt Instrument [Line Items] | ||
Long-term borrowing | 7,180 | 2,546 |
North Ocean 105 Construction Financing [Member] | ||
Debt Instrument [Line Items] | ||
Long-term borrowing | $ 31,877 | $ 38,263 |
Debt - Maturities of Long-Term
Debt - Maturities of Long-Term Debt During Five Years (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 49,820 | |
2,018 | 3,427 | |
2,019 | 212,846 | |
2,021 | 500,000 | |
Total Debt | 766,093 | |
Debt Issuance Costs | (13,573) | $ (20,000) |
Total Debt - Net of Issuance Costs | $ 752,520 | $ 843,883 |
Debt - Summary of Redemption Pr
Debt - Summary of Redemption Prices Expressed as Percentage (Detail) - Senior Notes [Member] | 12 Months Ended |
Dec. 31, 2016 | |
2017 [Member] | |
Debt Instrument Redemption [Line Items] | |
Redemption prices expressed as percentage | 104.00% |
2018 [Member] | |
Debt Instrument Redemption [Line Items] | |
Redemption prices expressed as percentage | 102.00% |
2019 and thereafter [Member] | |
Debt Instrument Redemption [Line Items] | |
Redemption prices expressed as percentage | 100.00% |
Pension and Postretirement Be68
Pension and Postretirement Benefits - Obligations and Funded Status (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | $ 532,403 | ||
Fair value of plan assets at end of year | 517,213 | $ 532,403 | |
Amounts recognized in balance sheet consist of: | |||
Pension liability | (19,471) | (24,066) | |
Domestic Plans [Member] | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of year | 519,199 | 556,632 | |
Interest cost | 21,102 | 21,613 | $ 26,972 |
Actuarial loss (gain) | 2,641 | (21,754) | |
Benefits paid | (37,586) | (37,292) | |
Benefit obligation at end of year | 505,356 | 519,199 | 556,632 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 494,146 | 551,821 | |
Actual return on plan assets | 26,891 | (21,889) | |
Company contributions | 1,510 | 1,506 | |
Benefits paid | (37,586) | (37,292) | |
Fair value of plan assets at end of year | 484,961 | 494,146 | 551,821 |
Funded status | (20,395) | (25,053) | |
Amounts recognized in balance sheet consist of: | |||
Accrued pension liability—current | (1,382) | (1,409) | |
Pension liability | (19,013) | (23,644) | |
Accrued benefit liability | (20,395) | (25,053) | |
Net (Liability) Asset | (20,395) | (25,053) | |
Plans with accumulated benefit obligation in excess of plan assets | |||
Projected benefit obligation | 505,356 | 519,199 | |
Accumulated benefit obligation | 505,356 | 519,199 | |
Fair value of plan assets | 484,961 | 494,146 | |
TCN Plan [Member] | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of year | 38,265 | 43,985 | |
Interest cost | 1,351 | 1,626 | 1,900 |
Actuarial loss (gain) | (3,172) | (4,095) | |
Benefits paid | (5,227) | (3,251) | |
Benefit obligation at end of year | 31,217 | 38,265 | 43,985 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 38,257 | 42,106 | |
Actual return on plan assets | (778) | (598) | |
Benefits paid | (5,227) | (3,251) | |
Fair value of plan assets at end of year | 32,252 | 38,257 | $ 42,106 |
Funded status | 1,035 | (8) | |
Amounts recognized in balance sheet consist of: | |||
Other Assets | 1,035 | ||
Pension liability | (8) | ||
Accrued benefit liability | (8) | ||
Net (Liability) Asset | 1,035 | (8) | |
Plans with accumulated benefit obligation in excess of plan assets | |||
Projected benefit obligation | 31,217 | 38,265 | |
Accumulated benefit obligation | 31,217 | 38,265 | |
Fair value of plan assets | $ 32,252 | $ 38,257 |
Pension and Postretirement Be69
Pension and Postretirement Benefits - Weighted Average Assumptions used to Determine Net Periodic Benefit Obligations and Net Periodic Benefit Cost (Detail) | Dec. 31, 2016 | Dec. 31, 2015 |
Domestic Plans [Member] | ||
Weighted average assumptions used to determine net periodic benefit obligations at December 31: | ||
Discount rate | 4.10% | 4.20% |
TCN Plan [Member] | ||
Weighted average assumptions used to determine net periodic benefit obligations at December 31: | ||
Discount rate | 4.10% | 4.00% |
Pension and Postretirement Be70
Pension and Postretirement Benefits - Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Domestic Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 21,102 | $ 21,613 | $ 26,972 |
Expected return on plan assets | (20,006) | (26,707) | (27,501) |
Actuarial loss (gain) | (4,244) | 26,842 | (8,728) |
Net periodic benefit cost (gain) | $ (3,148) | $ 21,748 | $ (9,257) |
Weighted average assumptions used to determine net periodic benefit cost: | |||
Discount rate | 4.20% | 4.00% | 4.80% |
Expected return on plan assets | 4.20% | 5.00% | 5.00% |
TCN Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 1,351 | $ 1,626 | $ 1,900 |
Expected return on plan assets | (1,587) | (2,840) | (2,961) |
Actuarial loss (gain) | (807) | (657) | 6,027 |
Net periodic benefit cost (gain) | $ (1,043) | $ (1,871) | $ 4,966 |
Weighted average assumptions used to determine net periodic benefit cost: | |||
Discount rate | 4.00% | 4.00% | 4.80% |
Expected return on plan assets | 4.70% | 6.90% | 6.90% |
Pension and Postretirement Be71
Pension and Postretirement Benefits - Asset Allocations by Asset Category (Detail) | Dec. 31, 2016 | Dec. 31, 2015 |
Domestic Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 100.00% | 100.00% |
TCN Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 100.00% | 100.00% |
Fixed Income [Member] | Domestic Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 85.00% | 85.00% |
Fixed Income [Member] | TCN Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 67.00% | 49.00% |
Equity Securities [Member] | Domestic Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 15.00% | 15.00% |
Equity Securities [Member] | TCN Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Weighted average asset allocations, by asset category | 33.00% | 51.00% |
Pension and Postretirement Be72
Pension and Postretirement Benefits - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
TCN Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Employer contributions, percentage match of participants' contributions | 50.00% | |
Employer contributions, percentage unmatched of participants' contributions | 3.00% | |
TCN Plan [Member] | Maximum [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined contribution plan matching percent of compensation | 6.00% | |
TCN Plan [Member] | Cash and Cash Equivalents [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Plan assets held in cash in cash equivalents | $ 14 | |
Domestic Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Employer contributions, percentage match of participants' contributions | 50.00% | |
Employer contributions, percentage unmatched of participants' contributions | 3.00% | |
Domestic Plans [Member] | Maximum [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined contribution plan matching percent of compensation | 6.00% |
Pension and Postretirement Be73
Pension and Postretirement Benefits - Total Investments Plans Measured at Fair Value (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 517,213 | $ 532,403 | |
Fixed Income [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 420,240 | 421,987 | |
Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 82,442 | 85,077 | |
Cash and Accrued Items [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 14,531 | 25,339 | |
Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 264,244 | 170,528 | |
Level 1 [Member] | Fixed Income [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 167,271 | 60,128 | |
Level 1 [Member] | Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 82,442 | 85,065 | |
Level 1 [Member] | Cash and Accrued Items [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 14,531 | 25,335 | |
Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 247,882 | 356,123 | |
Level 2 [Member] | Fixed Income [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 247,882 | 356,107 | |
Level 2 [Member] | Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 12 | ||
Level 2 [Member] | Cash and Accrued Items [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 4 | ||
Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 5,087 | 5,752 | |
Level 3 [Member] | Fixed Income [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 5,087 | $ 5,752 | $ 5,013 |
Pension and Postretirement Be74
Pension and Postretirement Benefits - Changes in Level Three Fixed Income Instrument Measured on Recurring Basis (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Fair value of plan assets at beginning of year | $ 532,403 | |
Fair value of plan assets at end of year | 517,213 | $ 532,403 |
Fixed Income [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Fair value of plan assets at beginning of year | 421,987 | |
Fair value of plan assets at end of year | 420,240 | 421,987 |
Level 3 [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Fair value of plan assets at beginning of year | 5,752 | |
Fair value of plan assets at end of year | 5,087 | 5,752 |
Level 3 [Member] | Fixed Income [Member] | ||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Fair value of plan assets at beginning of year | 5,752 | 5,013 |
Purchases, net | 107 | 1,269 |
Total unrealized loss | (772) | (530) |
Fair value of plan assets at end of year | $ 5,087 | $ 5,752 |
Pension and Postretirement Be75
Pension and Postretirement Benefits - Expected Employer Contributions to Trusts of Defined Benefit Plans (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Domestic Plans [Member] | |
Expected benefit payments: | |
2,017 | $ 37,148 |
2,018 | 36,929 |
2,019 | 36,620 |
2,020 | 36,228 |
2,021 | 35,876 |
2022-2026 | 169,531 |
TCN Plan [Member] | |
Expected benefit payments: | |
2,017 | 5,803 |
2,018 | 1,304 |
2,019 | 1,571 |
2,020 | 1,799 |
2,021 | 1,483 |
2022-2026 | $ 9,309 |
Pension and Postretirement Be76
Pension and Postretirement Benefits - Summary of Contributions Under Defined Contribution Plans (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Thrift Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Contributions | $ 4,176 | $ 3,840 | $ 3,879 |
Global Thrift Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Contributions | $ 998 | $ 1,095 | $ 1,236 |
Derivative Financial Instrume77
Derivative Financial Instruments - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative [Line Items] | ||
Net gain (loss) on derivative financial instruments | $ (25,082,000) | $ (64,277,000) |
Net deferred losses expected to be reclassified from AOCI over next 12 months | (11,000,000) | |
Notional value of outstanding derivative contracts | $ 332,000,000 | |
Derivative contracts, maturity date | May 31, 2018 | |
Fair value of derivative contracts | $ 7,000,000 | |
EPCI projects [Member] | ||
Derivative [Line Items] | ||
Notional value of outstanding derivative contracts | $ 158,000,000 |
Derivative Financial Instrume78
Derivative Financial Instruments - Derivative Financial Instruments (Detail) - Derivatives Designated as Hedges [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Derivatives Fair Value [Line Items] | ||
Asset derivatives fair value | $ 2,631 | $ 1,883 |
Liability derivatives fair value | 9,365 | 30,667 |
Accounts receivable-other [Member] | ||
Derivatives Fair Value [Line Items] | ||
Asset derivatives fair value | 2,631 | 1,668 |
Other assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Asset derivatives fair value | 215 | |
Other liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Liability derivatives fair value | 4 | 4,018 |
Accrued liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Liability derivatives fair value | $ 9,361 | $ 26,649 |
Derivative Financial Instrume79
Derivative Financial Instruments - Effects of Derivative Instruments on Consolidated Financial Statements (Detail) - Derivatives Designated as Hedges [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain (loss) recognized in other comprehensive income (loss) | $ 4,004 | $ (57,459) | $ (65,503) |
Cost of operations [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Reclassified from AOCI | 34,556 | 76,034 | 26,418 |
Gain (loss) on foreign currency, net [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Ineffective portion and amount excluded from effectiveness testing gain (loss) recognized | $ (1,461) | $ 6,238 | $ 6,910 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Instruments Outstanding Measured at Fair Value on Recurring and Nonrecurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Recurring | ||
Forward contracts | $ (7,000) | |
Carrying Amount [Member] | ||
Recurring | ||
Forward contracts | (6,734) | $ (28,784) |
Non-recurring | ||
Debt | (752,520) | (843,883) |
Fair value [Member] | ||
Recurring | ||
Forward contracts | (6,734) | (28,784) |
Non-recurring | ||
Debt | (777,072) | (777,634) |
Level 2 [Member] | ||
Recurring | ||
Forward contracts | (6,734) | (28,784) |
Non-recurring | ||
Debt | (728,072) | (707,492) |
Level 3 [Member] | ||
Non-recurring | ||
Debt | $ (49,000) | $ (70,142) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2014 | Dec. 31, 2016 | Sep. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||||||||
Non-cash impairment charges | $ 4,000 | $ 55,000 | $ 7,000 | $ 38,000 | ||||||
Carrying value of assets | $ 3,222,230 | 3,222,230 | 3,387,076 | |||||||
Property plant and equipment, fair value | $ 14,000 | |||||||||
Loss (gain) on asset disposals | $ 3,000 | $ (859) | $ 1,443 | $ (46,201) | ||||||
Property plant and equipment improvement | $ 1,000 | 11,000 | ||||||||
Intangible assets impairment charges | $ 2,000 | |||||||||
Marine Assets [Member] | ||||||||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||||||||
Non-cash impairment charges | $ 12,000 | |||||||||
Carrying value of assets | 22,000 | |||||||||
Estimated fair value of assets | $ 10,000 | |||||||||
AEA [Member] | ||||||||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||||||||
Non-cash impairment charges | $ 32,000 | |||||||||
AEA [Member] | Marine Assets [Member] | ||||||||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||||||||
Non-cash impairment charges | $ 11,000 | |||||||||
ASA [Member] | ||||||||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||||||||
Non-cash impairment charges | $ 7,000 | $ 38,000 | ||||||||
Property plant and equipment improvement | $ 11,000 |
Stock-based Compensation - Tota
Stock-based Compensation - Total Stock-Based Compensation Expense Recognized (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expenses | $ 22,680 | $ 16,593 | $ 16,516 |
Restricted Stock Awards (“RSAs”) and Restricted Stock Units (“RSUs”) [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expenses | 15,746 | 14,395 | 14,417 |
Stock Options [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expenses | 46 | 770 | 1,747 |
Performance Shares and Performance Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expenses | $ 6,888 | $ 1,428 | $ 352 |
Stock-Based Compensation - To83
Stock-Based Compensation - Total Gross Unrecognized Estimated Compensation Expense and Expected Weighted-Average Periods (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized estimated compensation expense for equity awards | $ 17,861 |
RSUs and RSAs [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized estimated compensation expense for equity awards | $ 17,603 |
Weighted-average period for expense recognition | 1 year 9 months 18 days |
Performance Shares and Performance Units [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized estimated compensation expense for equity awards | $ 258 |
Weighted-average period for expense recognition | 3 months 18 days |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Feb. 29, 2016 | Mar. 31, 2015 | May 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of stock options, granted | 0 | 0 | 0 | |||
Tax benefits realized related to RSUs and RSAs | $ 0 | $ 0 | $ 0 | |||
Stock Options [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of options, exercised | 0 | |||||
Total intrinsic value of stock options exercised | 300,000 | 900,000 | ||||
Fair value of shares vested | $ 1,000,000 | $ 3,000,000 | $ 4,000,000 | |||
Performance Shares [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common stock issued | 1,553,134 | 1,774,770 | ||||
Weighted-average vesting period | 1 year 9 months 18 days | 1 year 9 months 18 days | ||||
2014 McDermott International, Inc. Long-Term Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Additional shares approved for issuance | 6,600,000 | |||||
2009 McDermott International, Inc. Long-Term Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares authorized for issuance | 9,000,000 | |||||
Options to purchase shares, maximum expiration term | 7 years |
Stock-Based Compensation - Acti
Stock-Based Compensation - Activity for Stock Option (Detail) shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Number of Option Shares, Outstanding at beginning of period | shares | 2,896 |
Number of Option Shares, Cancelled/expired/forfeited | shares | (721) |
Number of Option Shares, Outstanding at end of period | shares | 2,175 |
Weighted-Average Exercise Price, Outstanding at beginning of period | $ / shares | $ 12.76 |
Weighted-Average Exercise Price, Cancelled/expired/forfeited | $ / shares | 8.65 |
Weighted-Average Exercise Price, Outstanding at end of period | $ / shares | $ 14.13 |
Weighted-Average Remaining Contractual Term, Outstanding at end of period | 1 year 11 months 9 days |
Stock-Based Compensation - Nonv
Stock-Based Compensation - Nonvested RSUs and RSAs and Changes (Detail) - RSUs and RSAs [Member] shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Shares, Nonvested at beginning of period | shares | 6,689 |
Number of Shares, Granted | shares | 3,876 |
Number of Shares, Vested | shares | (3,524) |
Number of Shares, Cancelled/forfeited | shares | (868) |
Number of Shares, Nonvested at end of period | shares | 6,173 |
Weighted Average Grant Date Fair Value, Nonvested at beginning of period | $ / shares | $ 5.15 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | 3.28 |
Weighted-Average Grant Date Fair Value, Vested | $ / shares | 5.78 |
Weighted-Average Grant Date Fair Value, Cancelled/forfeited | $ / shares | 3.86 |
Weighted Average Grant Date Fair Value, Nonvested at end of period | $ / shares | $ 3.80 |
Stock-Based Compensation - No87
Stock-Based Compensation - Nonvested Performance Shares and Performance Unit Awards and Changes (Detail) - Performance Shares [Member] shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of Shares, Nonvested at beginning of period | shares | 2,590 |
Number of Shares, Granted | shares | 1,582 |
Number of Shares, Cancelled/forfeited | shares | (711) |
Number of Shares, Nonvested at end of period | shares | 3,461 |
Weighted Average Grant Date Fair Value, Nonvested at beginning of period | $ / shares | $ 6.71 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | 3.22 |
Weighted Average Grant Date Fair Value, Cancelled/forfeited | $ / shares | 10.22 |
Weighted Average Grant Date Fair Value, Nonvested at end of period | $ / shares | $ 4.39 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Other than U.S.: | |||
Current | $ 43,944 | $ 45,752 | $ 21,619 |
Deferred | (2,018) | 6,211 | (1,546) |
Total provision for income taxes | $ 41,926 | $ 51,963 | $ 20,073 |
Income Taxes - Geographic Sourc
Income Taxes - Geographic Source of Income Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ (124,154) | $ (99,738) | $ (35,782) |
Other than U.S. | 206,469 | 164,348 | (1,691) |
Income before provision for income taxes | $ 82,315 | $ 64,610 | $ (37,473) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Panama Statutory Federal Tax Rate to Consolidated Effective Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Panama federal statutory rate | 25.00% | 25.00% | 25.00% |
Non-Panama operations | (14.00%) | 29.00% | 9.00% |
Valuation allowance for deferred tax assets | 24.00% | 10.00% | (105.00%) |
Audit settlements and reserves | 14.00% | 9.00% | 17.00% |
Other (primarily tax on unremitted earnings) | 2.00% | 7.00% | |
Effective tax rate attributable to continuing operations | 51.00% | 80.00% | (54.00%) |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Valuation allowance for deferred tax assets | $ (335,000) | |
Deferred tax assets | 21,116 | $ 18,822 |
Deferred tax liabilities: | ||
Net deferred tax liability | (3,584) | (6,279) |
Deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets include: | ||
Deferred tax assets | 21,116 | 18,822 |
Deferred tax liabilities | 24,700 | 25,101 |
Net deferred tax liability | (3,584) | (6,279) |
Reportable Legal Entities [Member] | ||
Deferred tax assets: | ||
Pension liability | 9,732 | 12,033 |
Accrued liabilities for incentive compensation | 22,208 | 21,640 |
Net operating loss carryforward | 349,916 | 325,636 |
State net operating loss carryforward | 18,308 | 24,367 |
Long-term contracts | 4,312 | |
Other | 1,861 | 2,060 |
Total deferred tax assets | 402,025 | 390,048 |
Valuation allowance for deferred tax assets | (334,991) | (336,146) |
Deferred tax assets | 67,034 | 53,902 |
Deferred tax liabilities: | ||
Property, plant and equipment | 37,883 | 34,419 |
Prepaid drydock | 1,367 | 7,639 |
Long-term contracts | 10,989 | |
Investments in joint ventures and affiliated companies | 17,044 | 14,960 |
Unrealized exchange gains and other | 3,335 | 3,163 |
Total deferred tax liabilities | 70,618 | 60,181 |
Deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets include: | ||
Deferred tax assets | $ 67,034 | $ 53,902 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Loss Carryforwards [Line Items] | |||
Valuation allowance for deferred tax assets | $ 335 | ||
Foreign net operating loss carryforwards | 373 | ||
U.S federal net operating loss carryforwards | 745 | ||
Taxes on earnings | 21 | ||
Undistributed earnings of subsidiaries | 236 | ||
Unrecognized deferred income tax liabilities | 0.2 | ||
Liabilities recorded for payment of tax-related interest and penalties | 20 | $ 16 | $ 15 |
Malaysia [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Reduction in income tax expense related to tax holiday | $ 0.2 | ||
Income tax holiday, effective date | Which is effective through December 31, 2020 | ||
Income tax holiday period | 5 years | ||
Income tax holiday, description | We operate under a tax holiday in Malaysia, our new Asia Pacific headquarters. This tax holiday is effective through December 31, 2020, and may be extended for an additional five years if we satisfy certain requirements. | ||
Foreign Country [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, valuation allowance | $ 76 | ||
Foreign Country [Member] | Minimum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,017 | ||
Foreign Country [Member] | Maximum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,019 | ||
Domestic Country [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, valuation allowance | $ 261 | ||
Domestic Country [Member] | Minimum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,030 | ||
Domestic Country [Member] | Maximum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,036 | ||
State and Local Jurisdiction [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, valuation allowance | $ 18 | ||
State net operating loss carryforward | $ 355 | ||
State and Local Jurisdiction [Member] | Minimum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,017 | ||
State and Local Jurisdiction [Member] | Maximum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards, expiration year | 2,030 | ||
Additional Paid-in Capital [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
U.S federal net operating loss carryforwards | $ 17 | ||
Expire in the years 2017 to 2019 [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Foreign net operating loss carryforwards | $ 22 |
Income Taxes - Reconciliation93
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Balance at beginning of period | $ 36,353 | $ 34,106 | $ 40,613 |
Increases based on tax positions taken in the current year | 2,328 | 4,720 | 3,479 |
Increases based on tax positions taken in prior years | 7,741 | 4,710 | 3,195 |
Decreases based on tax positions taken in prior years | (5,090) | (2,836) | (863) |
Decreases due to lapse of applicable statute of limitation | (310) | (4,347) | (12,318) |
Balance at end of period | $ 41,022 | $ 36,353 | $ 34,106 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [2] | Jun. 30, 2016 | [3] | Mar. 31, 2016 | [4] | Dec. 31, 2015 | [5] | Sep. 30, 2015 | [6] | Jun. 30, 2015 | [7] | Mar. 31, 2015 | [8] | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share [Abstract] | |||||||||||||||||||
Net income (loss) attributable to McDermott International, Inc. | $ (476) | $ 16,108 | $ 20,657 | $ (2,172) | $ (18,668) | $ 3,666 | $ 11,526 | $ (14,507) | $ 34,117 | $ (17,983) | $ (75,994) | ||||||||
Weighted average common stock (basic) | 240,359,363 | 238,240,763 | 237,229,086 | ||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||
Tangible equity units | 40,824,938 | ||||||||||||||||||
Stock options, restricted stock and restricted stock units | 2,999,938 | 40,900,000 | 30,700,000 | ||||||||||||||||
Potential dilutive common stock | 284,184,239 | 238,240,763 | 237,229,086 | ||||||||||||||||
Net income (loss) attributable to McDermott International, Inc. | |||||||||||||||||||
Basic: | $ 0 | [9] | $ 0.07 | [9] | $ 0.09 | [9] | $ (0.01) | [9] | $ (0.08) | [9] | $ 0.02 | [9] | $ 0.05 | [9] | $ (0.06) | [9] | $ 0.14 | $ (0.08) | $ (0.32) |
Diluted: | $ 0 | [9] | $ 0.06 | [9] | $ 0.07 | [9] | $ (0.01) | [9] | $ (0.08) | [9] | $ 0.01 | [9] | $ 0.04 | [9] | $ (0.06) | [9] | $ 0.12 | $ (0.08) | $ (0.32) |
[1] | Net loss for the quarter ended December 31, 2016 was primarily due to increase in our estimated costs at completion on our Ichthys project in Australia and an impairment charge on the Intermac 600. Those were partially offset by productivity improvements and associated cost savings, primarily in our MEA segment. | ||||||||||||||||||
[2] | Net income for the quarter ended September 30, 2016 was influenced by productivity improvements and associated cost savings, primarily in the MEA and ASA segments, partially offset by impairment losses on certain marine assets. | ||||||||||||||||||
[3] | Net income for the quarter ended June 30, 2016 was influenced by productivity improvements and associated cost savings in the MEA and ASA segments. | ||||||||||||||||||
[4] | Net loss for the quarter ended March 31, 2016 was influenced by successful execution and close-out improvements in the AEA segment and productivity improvements and associated cost savings, primarily in the ASA segment, partially offset by impairment losses on the Agile vessel. | ||||||||||||||||||
[5] | Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. | ||||||||||||||||||
[6] | Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. | ||||||||||||||||||
[7] | Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. | ||||||||||||||||||
[8] | Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. | ||||||||||||||||||
[9] | May not tie to the Consolidated Statements of Operations due to rounding. |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from earnings per share computation, shares | 2,200,000 | 2,900,000 | 3,100,000 |
Antidilutive securities included from diluted weighted average shares computation, shares | 2,999,938 | 40,900,000 | 30,700,000 |
Restricted Stock Units and Restricted Stock Awards [Member] | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities included from diluted weighted average shares computation, shares | 2,400,000 |
Stockholder's Equity - Changes
Stockholder's Equity - Changes in the Number of Ordinary Shares Outstanding and Treasury Shares Held by the Company (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Shares Outstanding [Abstract] | ||
Beginning balance | 239,016,924 | 237,809,823 |
Common stock issued | 3,304,808 | 1,672,923 |
Purchase of common stock | (933,455) | (465,822) |
Ending balance | 241,388,277 | 239,016,924 |
Shares Held as Treasury Shares [Abstract] | ||
Beginning balance | 7,824,204 | 7,400,027 |
Purchase of common stock | 933,455 | 465,822 |
Retirement of common stock | (455,655) | (41,645) |
Ending balance | 8,302,004 | 7,824,204 |
Common stock, shares issued | 249,690,281 | 246,841,128 |
Stockholder's Equity - Componen
Stockholder's Equity - Components of Accumulated Other Comprehensive Income (Loss) included in Stockholders' Equity (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Stockholders Equity Note [Abstract] | ||
Foreign currency translation adjustments ("FCTA") | $ (42,082) | $ (29,925) |
Net unrealized gain on investments | 269 | 247 |
Net gain (loss) on derivative financial instruments | (25,082) | (64,277) |
Accumulated other comprehensive loss | $ (66,895) | $ (93,955) |
Stockholder's Equity - Addition
Stockholder's Equity - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income Loss [Line Items] | |||||||
Adjustment decreasing FCTA with an offsetting reduction of Loss on foreign currency, net to correct amounts | $ 7,000 | ||||||
Cash flow hedges loss recorded in AOCI | $ (39,148) | $ (18,480) | $ 37,537 | ||||
Decrease in noncontrolling interest due to acquisition | 17,182 | 32,943 | |||||
Other non-operating income (expense), net | (1,067) | $ 1,986 | $ 7,002 | ||||
THHE Fabricators Sdn. Bhd [Member] | |||||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||||
Percentage of interest acquired in subsidiary | 30.00% | ||||||
Decrease in investments in unconsolidated affiliates | 12,000 | ||||||
Other non-operating income (expense), net | 5,000 | ||||||
Berlian McDermott Sdn, Bhd, [Member] | |||||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||||
Percentage of interest acquired in subsidiary | 30.00% | ||||||
Fair value of asset surrendered | $ 17,000 | ||||||
Decrease in noncontrolling interest due to acquisition | $ 18,000 | ||||||
Berlian McDermott Sdn, Bhd, [Member] | TH Heavy Engineering Berhad [Member] | |||||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||||
Noncontrolling interest acquired by noncontrolling owners | 30.00% | ||||||
DLV 2000 [Member] | Foreign Exchange Forward [Member] | |||||||
Accumulated Other Comprehensive Income Loss [Line Items] | |||||||
Cash flow hedges loss recorded in AOCI | $ 20,000 |
Stockholder's Equity - Compon99
Stockholder's Equity - Components of Accumulated Other Comprehensive Income (Loss) Reclassified (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | $ 1,546,721 | $ 1,539,114 | $ 1,440,344 | |
Other comprehensive income (loss), net of tax | 27,013 | 3,773 | (50,187) | |
Ending Balance | 1,595,468 | 1,546,721 | 1,539,114 | |
Foreign currency translation adjustments [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | (29,925) | (15,212) | (2,562) | |
Other comprehensive income (loss) before reclassification | (12,157) | (12,470) | (9,250) | |
Amounts reclassified from AOCI | (2,243) | (3,400) | ||
Other comprehensive income (loss), net of tax | (12,157) | (14,713) | (12,650) | |
Ending Balance | (42,082) | (29,925) | (15,212) | |
Unrealized holding gain (loss) on investments [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 247 | 241 | 238 | |
Other comprehensive income (loss) before reclassification | 22 | 6 | 3 | |
Other comprehensive income (loss), net of tax | 22 | 6 | 3 | |
Ending Balance | 269 | 247 | 241 | |
Gain (loss) on derivatives[Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | [1] | (64,277) | (82,837) | (45,386) |
Other comprehensive income (loss) before reclassification | [1] | 4,004 | (57,459) | (65,503) |
Amounts reclassified from AOCI | [1],[2] | 35,191 | 76,019 | 28,052 |
Other comprehensive income (loss), net of tax | [1] | 39,195 | 18,560 | (37,451) |
Ending Balance | [1] | (25,082) | (64,277) | (82,837) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | (93,955) | (97,808) | (47,710) | |
Other comprehensive income (loss) before reclassification | (8,131) | (69,923) | (74,750) | |
Amounts reclassified from AOCI | 35,191 | 73,776 | 24,652 | |
Other comprehensive income (loss), net of tax | 27,060 | 3,853 | (50,098) | |
Ending Balance | $ (66,895) | $ (93,955) | $ (97,808) | |
[1] | Refer to Note 12, Derivative Financial Instruments, for additional details | |||
[2] | Reclassified to cost of operations and gain (loss) on foreign currency, net |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2016 | Dec. 31, 2013 | |
Commitments And Contingencies Disclosure [Line Items] | |||||
Liquidated damages exposure | $ 16 | ||||
Total rental expense | 36 | $ 40 | $ 107 | ||
Maximum [Member] | |||||
Commitments And Contingencies Disclosure [Line Items] | |||||
Liabilities of liquidated damages | 1 | ||||
Morgan City fabrication facility [Member] | |||||
Commitments And Contingencies Disclosure [Line Items] | |||||
Potential environmental liabilities | $ 6 | ||||
Environmental loss contingencies, incurred | $ 4 | ||||
Reversal of environmental liability | $ (1) |
Commitments and Contingencie101
Commitments and Contingencies - Future Minimum Payments Required under Operating Leases that have Initial or Remaining Non-cancellable Lease Terms in Excess of One Year (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,017 | $ 27,864 |
2,018 | 23,185 |
2,019 | 19,076 |
2,020 | 19,208 |
2,021 | 14,425 |
Thereafter | $ 122,922 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)Segment | Dec. 31, 2015USD ($) | |
Segment Reporting [Abstract] | ||
Number of reportable segments | Segment | 3 | |
Number of operating segments | Segment | 3 | |
Receivables from unconsolidated affiliates, current and non-current | $ | $ 17,000 | |
Receivables from unconsolidated affiliates | $ | $ 13,292 | $ 12,816 |
Segment Reporting - Information
Segment Reporting - Information about Operations in Different Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [2] | Jun. 30, 2016 | [3] | Mar. 31, 2016 | [4] | Dec. 31, 2015 | [5] | Sep. 30, 2015 | [6] | Jun. 30, 2015 | [7] | Mar. 31, 2015 | [8] | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | $ 641,781 | $ 558,543 | $ 706,627 | $ 729,032 | $ 667,418 | $ 805,857 | $ 1,046,537 | $ 550,463 | $ 2,635,983 | [9] | $ 3,070,275 | [9] | $ 2,300,889 | [9] | |||||||||
Operating income (loss) | [10] | 142,253 | 112,682 | 16,402 | |||||||||||||||||||
Interest expense, net | (58,871) | (50,058) | (60,877) | ||||||||||||||||||||
Other non-operating income (expense), net | (1,067) | 1,986 | 7,002 | ||||||||||||||||||||
Income (loss) before provision for income taxes | 82,315 | 64,610 | (37,473) | ||||||||||||||||||||
Capital expenditures | [11] | 228,079 | 102,851 | 321,187 | |||||||||||||||||||
Depreciation and amortization | 89,882 | 100,334 | 93,185 | ||||||||||||||||||||
Drydock amortization | 12,795 | 17,947 | 19,719 | ||||||||||||||||||||
Operating Segments [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Operating income (loss) | [10] | 358,493 | 323,502 | 73,136 | |||||||||||||||||||
Operating Segments [Member] | AEA [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [9] | 285,988 | 478,800 | 567,608 | |||||||||||||||||||
Operating income (loss) | [10] | 51,129 | 52,918 | (65,565) | |||||||||||||||||||
Capital expenditures | [11] | 16,667 | 13,715 | 53,431 | |||||||||||||||||||
Depreciation and amortization | 26,924 | 43,006 | 34,494 | ||||||||||||||||||||
Drydock amortization | 9,905 | 12,554 | 11,453 | ||||||||||||||||||||
Operating Segments [Member] | MEA [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [9] | 1,241,591 | 1,134,555 | 795,666 | |||||||||||||||||||
Operating income (loss) | [10] | 209,401 | 146,866 | 47,863 | |||||||||||||||||||
Capital expenditures | [11] | 18,564 | 28,328 | 99,974 | |||||||||||||||||||
Depreciation and amortization | 24,268 | 30,567 | 31,876 | ||||||||||||||||||||
Drydock amortization | 1,975 | 2,089 | 2,011 | ||||||||||||||||||||
Operating Segments [Member] | ASA [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Revenues | [9] | 1,108,404 | 1,456,920 | 937,615 | |||||||||||||||||||
Operating income (loss) | [10] | 97,963 | 123,718 | 90,838 | |||||||||||||||||||
Capital expenditures | [11] | 190,260 | 60,220 | 154,735 | |||||||||||||||||||
Depreciation and amortization | 30,314 | 16,880 | 19,020 | ||||||||||||||||||||
Drydock amortization | 915 | 3,304 | 6,255 | ||||||||||||||||||||
Corporate and Other [Member] | |||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||
Operating income (loss) | [10] | (216,240) | (210,820) | (56,734) | |||||||||||||||||||
Capital expenditures | [11] | 2,588 | 588 | 13,047 | |||||||||||||||||||
Depreciation and amortization | $ 8,376 | $ 9,881 | $ 7,795 | ||||||||||||||||||||
[1] | Net loss for the quarter ended December 31, 2016 was primarily due to increase in our estimated costs at completion on our Ichthys project in Australia and an impairment charge on the Intermac 600. Those were partially offset by productivity improvements and associated cost savings, primarily in our MEA segment. | ||||||||||||||||||||||
[2] | Net income for the quarter ended September 30, 2016 was influenced by productivity improvements and associated cost savings, primarily in the MEA and ASA segments, partially offset by impairment losses on certain marine assets. | ||||||||||||||||||||||
[3] | Net income for the quarter ended June 30, 2016 was influenced by productivity improvements and associated cost savings in the MEA and ASA segments. | ||||||||||||||||||||||
[4] | Net loss for the quarter ended March 31, 2016 was influenced by successful execution and close-out improvements in the AEA segment and productivity improvements and associated cost savings, primarily in the ASA segment, partially offset by impairment losses on the Agile vessel. | ||||||||||||||||||||||
[5] | Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. | ||||||||||||||||||||||
[6] | Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. | ||||||||||||||||||||||
[7] | Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. | ||||||||||||||||||||||
[8] | Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. | ||||||||||||||||||||||
[9] | Intercompany transactions were not significant during 2016, 2015 and 2014. | ||||||||||||||||||||||
[10] | The 2016 and 2015 Corporate and Other operating results include $55 million and $7 million of impairment, respectively. The 2014 Corporate and Other operating results include $11 million of improvements to the cancellation cost estimate included in the $38 million vessel impairment charge recognized in 2013. See Note 13, Fair Value Measurements, for further discussion. | ||||||||||||||||||||||
[11] | Total capital expenditures represent expenditures for which cash payments were made during the period. Capital expenditures for 2016, 2015 and 2014 include $4 million, $14 million and $27 million of cash payments for accrued capital expenditures outstanding as of December 31, 2015, 2014 and 2013, respectively. |
Segment Reporting - Informat104
Segment Reporting - Information about Operations in Different Segments (Parenthetical) (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2014 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Segment Reporting Information [Line Items] | |||||||
Asset Impairment Charges | $ 4,000 | $ 55,000 | $ 7,000 | $ 38,000 | |||
Property plant and equipment improvement | $ 1,000 | $ 11,000 | |||||
Capital expenditures | [1] | 228,079 | 102,851 | 321,187 | |||
Accrued Capital Expenditures of 2016 [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Capital expenditures | $ 4,000 | ||||||
Accrued Capital Expenditures of 2015 [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Capital expenditures | $ 14,000 | ||||||
Accrued Capital Expenditures of 2014 [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Capital expenditures | $ 27,000 | ||||||
[1] | Total capital expenditures represent expenditures for which cash payments were made during the period. Capital expenditures for 2016, 2015 and 2014 include $4 million, $14 million and $27 million of cash payments for accrued capital expenditures outstanding as of December 31, 2015, 2014 and 2013, respectively. |
Segment Reporting - Significant
Segment Reporting - Significant Impact of Customers on Company Segments (Detail) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||
Percentage of consolidated revenues | 100.00% | 100.00% | 100.00% |
Customer Concentration Risk [Member] | Asia [Member] | Inpex Operations Australia Pty Ltd [Member] | Sales Revenue, Net [Member] | |||
Segment Reporting Information [Line Items] | |||
Percentage of consolidated revenues | 33.00% | 36.00% | 25.00% |
Customer Concentration Risk [Member] | Middle East [Member] | Saudi Aramco [Member] | Sales Revenue, Net [Member] | |||
Segment Reporting Information [Line Items] | |||
Percentage of consolidated revenues | 26.00% | 28.00% | 27.00% |
Customer Concentration Risk [Member] | Middle East [Member] | RasGas Company Limited [Member] | Sales Revenue, Net [Member] | |||
Segment Reporting Information [Line Items] | |||
Percentage of consolidated revenues | 12.00% |
Segment Reporting - Informat106
Segment Reporting - Information about Service Lines and Operations in Different Geographic Areas (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [2] | Jun. 30, 2016 | [3] | Mar. 31, 2016 | [4] | Dec. 31, 2015 | [5] | Sep. 30, 2015 | [6] | Jun. 30, 2015 | [7] | Mar. 31, 2015 | [8] | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | $ 641,781 | $ 558,543 | $ 706,627 | $ 729,032 | $ 667,418 | $ 805,857 | $ 1,046,537 | $ 550,463 | $ 2,635,983 | [9] | $ 3,070,275 | [9] | $ 2,300,889 | [9] | ||||||||
Installation Operations [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 1,074,069 | 1,256,412 | 1,041,525 | |||||||||||||||||||
Procurement Activities [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 879,222 | 1,123,329 | 677,734 | |||||||||||||||||||
Project Services and Engineering Operations [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 356,781 | 416,906 | 314,776 | |||||||||||||||||||
Fabrication Operations [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 325,911 | 273,628 | 266,854 | |||||||||||||||||||
Australia [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 881,812 | 1,157,723 | 614,164 | |||||||||||||||||||
Saudi Arabia [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 767,119 | 900,483 | 616,659 | |||||||||||||||||||
Qatar [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 419,963 | 46,873 | ||||||||||||||||||||
Mexico [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 112,484 | 247,859 | 130,642 | |||||||||||||||||||
Russia [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 108,392 | |||||||||||||||||||||
United States [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 95,996 | 32,858 | 148,606 | |||||||||||||||||||
Trinidad [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 67,757 | |||||||||||||||||||||
India [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 56,027 | |||||||||||||||||||||
United Arab Emirates [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 54,392 | 185,606 | 57,249 | |||||||||||||||||||
Malaysia [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 22,637 | 98,004 | ||||||||||||||||||||
Indonesia [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 21,726 | 54,288 | 150,205 | |||||||||||||||||||
Brunei [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 237,337 | |||||||||||||||||||||
Brazil [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 6,449 | 183,656 | 290,561 | |||||||||||||||||||
Azerbaijan [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | 111,382 | |||||||||||||||||||||
Other countries [Member] | ||||||||||||||||||||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Revenues | $ 21,229 | $ 23,592 | $ 83,417 | |||||||||||||||||||
[1] | Net loss for the quarter ended December 31, 2016 was primarily due to increase in our estimated costs at completion on our Ichthys project in Australia and an impairment charge on the Intermac 600. Those were partially offset by productivity improvements and associated cost savings, primarily in our MEA segment. | |||||||||||||||||||||
[2] | Net income for the quarter ended September 30, 2016 was influenced by productivity improvements and associated cost savings, primarily in the MEA and ASA segments, partially offset by impairment losses on certain marine assets. | |||||||||||||||||||||
[3] | Net income for the quarter ended June 30, 2016 was influenced by productivity improvements and associated cost savings in the MEA and ASA segments. | |||||||||||||||||||||
[4] | Net loss for the quarter ended March 31, 2016 was influenced by successful execution and close-out improvements in the AEA segment and productivity improvements and associated cost savings, primarily in the ASA segment, partially offset by impairment losses on the Agile vessel. | |||||||||||||||||||||
[5] | Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. | |||||||||||||||||||||
[6] | Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. | |||||||||||||||||||||
[7] | Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. | |||||||||||||||||||||
[8] | Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. | |||||||||||||||||||||
[9] | Intercompany transactions were not significant during 2016, 2015 and 2014. |
Segment Reporting - Informat107
Segment Reporting - Information about Segment Assets and Property, Plant and Equipment by Country (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
Total assets | $ 3,222,230 | $ 3,387,076 | |
Net Property, Plant and Equipment | [1] | 1,687,301 | 1,610,859 |
Australia [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 626,605 | |
Mexico [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 603,185 | 96,090 |
United Arab Emirates [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 318,822 | 341,502 |
United States [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 27,482 | 561,990 |
Saudi Arabia [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 22,608 | 4,522 |
Indonesia [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 73,213 | 521,922 |
India [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 10,666 | 307 |
Malaysia [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 2,457 | 49,609 |
Brazil [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 170 | 31,765 |
Other countries [Member] | |||
Segment Reporting Information [Line Items] | |||
Net Property, Plant and Equipment | [1] | 2,093 | 3,152 |
Operating Segments [Member] | AEA [Member] | |||
Segment Reporting Information [Line Items] | |||
Total assets | 727,328 | 896,822 | |
Operating Segments [Member] | MEA [Member] | |||
Segment Reporting Information [Line Items] | |||
Total assets | 907,936 | 971,170 | |
Operating Segments [Member] | ASA [Member] | |||
Segment Reporting Information [Line Items] | |||
Total assets | 976,470 | 774,365 | |
Corporate and Other [Member] | |||
Segment Reporting Information [Line Items] | |||
Total assets | $ 610,496 | $ 744,719 | |
[1] | Our marine vessels are included in the country in which they were located as of year-end. |
Segment Reporting - Informat108
Segment Reporting - Information about Unconsolidated Affiliates (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Equity in Loss of Unconsolidated Affiliates | $ (4,090) | $ (21,486) | $ (7,848) |
Investments in Unconsolidated Affiliates | 17,023 | 26,551 | |
Operating Segments [Member] | AEA [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Equity in Loss of Unconsolidated Affiliates | (5,082) | (6,255) | 4,829 |
Investments in Unconsolidated Affiliates | 2,449 | 1,540 | |
Operating Segments [Member] | MEA [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Equity in Loss of Unconsolidated Affiliates | (94) | (2,668) | |
Operating Segments [Member] | ASA [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Equity in Loss of Unconsolidated Affiliates | 1,167 | (15,137) | $ (10,009) |
Investments in Unconsolidated Affiliates | 14,064 | 24,327 | |
Corporate and Other [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Equity in Loss of Unconsolidated Affiliates | (175) | ||
Investments in Unconsolidated Affiliates | $ 510 | $ 684 |
Quarterly Financial Data (Un109
Quarterly Financial Data (Unaudited) - Selected Unaudited Quarterly Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [2] | Jun. 30, 2016 | [3] | Mar. 31, 2016 | [4] | Dec. 31, 2015 | [5] | Sep. 30, 2015 | [6] | Jun. 30, 2015 | [7] | Mar. 31, 2015 | [8] | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||||
Revenues | $ 641,781 | $ 558,543 | $ 706,627 | $ 729,032 | $ 667,418 | $ 805,857 | $ 1,046,537 | $ 550,463 | $ 2,635,983 | [9] | $ 3,070,275 | [9] | $ 2,300,889 | [9] | ||||||||
Gross Profit | 59,139 | 103,044 | 111,185 | 112,999 | 98,076 | 84,896 | 121,015 | 75,004 | ||||||||||||||
Net income (loss) | 546 | 16,392 | 21,805 | (2,444) | (18,015) | 7,534 | 13,690 | (12,048) | 36,299 | (8,839) | (65,394) | |||||||||||
Net income (loss) attributable to non-controlling interest | 1,022 | 284 | 1,148 | (272) | 653 | 3,868 | 2,164 | 2,459 | 2,182 | 9,144 | 10,600 | |||||||||||
Net income (loss) attributable to McDermott International, Inc. | $ (476) | $ 16,108 | $ 20,657 | $ (2,172) | $ (18,668) | $ 3,666 | $ 11,526 | $ (14,507) | $ 34,117 | $ (17,983) | $ (75,994) | |||||||||||
Income (loss) per share | ||||||||||||||||||||||
Basic | $ 0 | [10] | $ 0.07 | [10] | $ 0.09 | [10] | $ (0.01) | [10] | $ (0.08) | [10] | $ 0.02 | [10] | $ 0.05 | [10] | $ (0.06) | [10] | $ 0.14 | $ (0.08) | $ (0.32) | |||
Diluted | $ 0 | [10] | $ 0.06 | [10] | $ 0.07 | [10] | $ (0.01) | [10] | $ (0.08) | [10] | $ 0.01 | [10] | $ 0.04 | [10] | $ (0.06) | [10] | $ 0.12 | $ (0.08) | $ (0.32) | |||
[1] | Net loss for the quarter ended December 31, 2016 was primarily due to increase in our estimated costs at completion on our Ichthys project in Australia and an impairment charge on the Intermac 600. Those were partially offset by productivity improvements and associated cost savings, primarily in our MEA segment. | |||||||||||||||||||||
[2] | Net income for the quarter ended September 30, 2016 was influenced by productivity improvements and associated cost savings, primarily in the MEA and ASA segments, partially offset by impairment losses on certain marine assets. | |||||||||||||||||||||
[3] | Net income for the quarter ended June 30, 2016 was influenced by productivity improvements and associated cost savings in the MEA and ASA segments. | |||||||||||||||||||||
[4] | Net loss for the quarter ended March 31, 2016 was influenced by successful execution and close-out improvements in the AEA segment and productivity improvements and associated cost savings, primarily in the ASA segment, partially offset by impairment losses on the Agile vessel. | |||||||||||||||||||||
[5] | Net loss for the quarter ended December 31, 2015 was influenced by improved productivity in our MEA segment offset by a $26 million fourth quarter non-cash MTM actuarial loss on our pension benefit plans. | |||||||||||||||||||||
[6] | Net income for the quarter ended September 30, 2015 was influenced by improved productivity in our MEA segment. | |||||||||||||||||||||
[7] | Net income for the quarter ended June 30, 2015 was influenced by improved productivity and increased activity in the ASA and MEA segments partially offset by an increase in restructuring expense. | |||||||||||||||||||||
[8] | Net loss for the quarter ended March 31, 2015 benefited from positive changes in estimate primarily related to cost savings. | |||||||||||||||||||||
[9] | Intercompany transactions were not significant during 2016, 2015 and 2014. | |||||||||||||||||||||
[10] | May not tie to the Consolidated Statements of Operations due to rounding. |
Quarterly Financial Data (Un110
Quarterly Financial Data (Unaudited) - Selected Unaudited Quarterly Financial Information (Parenthetical) (Detail) $ in Millions | 3 Months Ended |
Dec. 31, 2015USD ($) | |
MEA [Member] | |
Quarterly Financial Information [Line Items] | |
Actuarial loss (gain) | $ 26 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Feb. 28, 2017 | Jan. 31, 2017 | Jun. 30, 2014 | Apr. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2014 | |
Subsequent Event [Line Items] | ||||||
Proceeds from sale of vessel, cash consideration | $ 14 | $ 32 | $ 25 | |||
Subsequent Event [Member] | Amazon Pipelay and Construction Vessel [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Purchase of vessel, cash consideration | $ 52 | |||||
Proceeds from sale of vessel, cash consideration | $ 52 | |||||
Bareboat charter agreement, term | 11 years | |||||
McDermott International Management [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Description of loan agreement | JRM Mexico’s obligations in connection with equipment financing are guaranteed by McDermott International Management, S. de RL, one of our indirectly 100% owned subsidiaries | |||||
Scenario Forecast [Member] | JRM Mexico [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Percentage of ownership in the subsidiary | 100.00% | |||||
Purchase agreement period | 364 days | |||||
Sale of committed revolving receivable purchase agreement | $ 50 | |||||
Loan agreement for equipment financing, term | 21 months | |||||
Equipment financing amount | $ 48 | |||||
Loan agreement fixed interest rate | 5.75% | |||||
Scenario Forecast [Member] | McDermott International Management [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Percentage of ownership in the subsidiary | 100.00% |