Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | ||
Sep. 30, 2020 | Nov. 03, 2020 | ||
Document and Entity Information [Abstract] | |||
Document Type | 10-Q | ||
Document Quarterly Report | true | ||
Document Period End Date | Sep. 30, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-34037 | ||
Entity Registrant Name | SUPERIOR ENERGY SERVICES INC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 75-2379388 | ||
Entity Address, Address Line One | 1001 Louisiana Street | ||
Entity Address, Address Line Two | Suite 2900 | ||
Entity Address, City or Town | Houston | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 77002 | ||
City Area Code | 713 | ||
Local Phone Number | 654-2200 | ||
Title of 12(b) Security | Common Stock, $.001 par value | ||
Trading Symbol | [1] | SPNX | |
Security Exchange Name | [1] | NONE | |
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 14,826,906 | ||
Entity Central Index Key | 0000886835 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | Q3 | ||
Current Fiscal Year End Date | --12-31 | ||
[1] | On September 17, 2020, our common stock was suspended from trading on the New York Stock Exchange (the NYSE). On September 18, 2020, our common stock began trading on the OTCQX Marketplace maintained by the OTC Markets Group, Inc. under the symbol “SPNX.” On October 2, 2020, the NYSE filed a Form 25 with the Securities and Exchange Commission (the SEC) to delist our common stock from trading on the NYSE and to remove it from registration under Section 12(b) of the Securities Exchange Act of 1934, as amended (the Exchange Act). The delisting became effective 10 days after the filing of the Form 25. In accordance with Rule 12d2-2 of the Exchange Act, the de-registration of our common stock under Section 12(b) of the Exchange Act will become effective 90 days, or such shorter period as the SEC may determine, from the date of the Form 25 filing. |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 207,781 | $ 272,624 |
Accounts receivable, net of allowance for doubtful accounts of $18,414 and $12,156 at September 30, 2020 and December 31, 2019, respectively | 181,666 | 332,047 |
Income taxes receivable | 4,119 | 740 |
Prepaid expenses | 42,465 | 49,132 |
Inventory and other current assets | 108,639 | 117,629 |
Assets held for sale | 51,748 | 216,197 |
Total current assets | 596,418 | 988,369 |
Property, plant and equipment, net of accumulated depreciation and depletion of$2,184,340 and $2,214,116 at September 30, 2020 and December 31, 2019, respectively | 574,588 | 664,949 |
Operating lease right-of-use assets | 56,198 | 80,906 |
Goodwill | 137,142 | 137,695 |
Notes receivable | 71,472 | 68,092 |
Restricted cash | 80,175 | 2,764 |
Intangible and other long-term assets, net of accumulated amortization of $24,675and $23,199 at September 30, 2020 and December 31, 2019, respectively | 58,253 | 50,455 |
Total assets | 1,574,246 | 1,993,230 |
Current liabilities: | ||
Accounts payable | 60,042 | 92,966 |
Accrued expenses | 159,395 | 182,934 |
Current portion of decommissioning liabilities | 3,735 | 3,649 |
Liabilities held for sale | 5,760 | 44,938 |
Total current liabilities | 228,932 | 324,487 |
Long-term debt, net | 1,289,288 | 1,286,629 |
Decommissioning liabilities | 137,315 | 132,632 |
Operating lease liabilities | 38,649 | 62,354 |
Deferred income taxes | 3,599 | 3,247 |
Other long-term liabilities | 126,199 | 134,308 |
Stockholders’ equity (deficit): | ||
Preferred stock of $0.01 par value. Authorized - 5,000,000 shares; none issued | ||
Common stock of $0.001 par value Authorized - 25,000,000, Issued - 15,799,318, Outstanding - 14,826,906 at September 30, 2020 Authorized - 25,000,000, Issued - 15,689,463, Outstanding - 14,717,051 at December 31, 2019 | 16 | 16 |
Additional paid-in capital | 2,756,031 | 2,752,859 |
Treasury stock at cost, 972,412 shares at September 30, 2020 and December 31, 2019, respectively | (4,290) | (4,290) |
Accumulated other comprehensive loss, net | (72,534) | (71,927) |
Accumulated deficit | (2,928,959) | (2,627,085) |
Total stockholders’ equity (deficit) | (249,736) | 49,573 |
Total liabilities and stockholders’ equity (deficit) | $ 1,574,246 | $ 1,993,230 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts | $ 18,414 | $ 12,156 |
Accumulated depreciation and depletion on Property, plant and equipment | 2,184,340 | 2,214,116 |
Accumulated amortization of Intangible and other long-term assets | $ 24,675 | $ 23,199 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 15,799,318 | 15,689,463 |
Common stock, shares outstanding | 14,826,906 | 14,717,051 |
Treasury Stock, Shares | 972,412 | 972,412 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues: | ||||
Total revenues | $ 166,928 | $ 356,585 | $ 672,278 | $ 1,089,297 |
Costs and expenses: | ||||
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) | 116,233 | 231,927 | 456,722 | 701,512 |
Depreciation, depletion, amortization and accretion | 35,172 | 45,162 | 113,313 | 152,776 |
General and administrative expenses | 54,966 | 60,866 | 178,543 | 203,015 |
Restructuring expense | 25,746 | 27,033 | ||
Reduction in value of assets | 2,929 | 9,571 | 19,451 | 17,128 |
Income (loss) from operations | (68,118) | 9,059 | (122,784) | 14,866 |
Other income (expense): | ||||
Interest expense, net | (24,794) | (24,505) | (74,677) | (74,275) |
Other income (expense): | (1,399) | (3,353) | (4,810) | (4,476) |
Loss from continuing operations before income taxes | (94,311) | (18,799) | (202,271) | (63,885) |
Income taxes | 4,990 | 1,708 | (11,772) | 7,707 |
Net loss from continuing operations | (99,301) | (20,507) | (190,499) | (71,592) |
Loss from discontinued operations, net of income tax | (58,003) | (17,934) | (111,375) | (85,604) |
Net loss | $ (157,304) | $ (38,441) | $ (301,874) | $ (157,196) |
Basic and diluted loss per share: | ||||
Net loss from continuing operations | $ (6.70) | $ (1.31) | $ (12.87) | $ (4.60) |
Loss from discontinued operations | (3.91) | (1.15) | (7.53) | (5.49) |
Net loss | $ (10.61) | $ (2.46) | $ (20.40) | $ (10.09) |
Weighted average shares outstanding | 14,827 | 15,657 | 14,795 | 15,581 |
Services [Member] | ||||
Revenues: | ||||
Total revenues | $ 97,001 | $ 211,540 | $ 367,846 | $ 689,248 |
Costs and expenses: | ||||
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) | 81,535 | 162,469 | 303,134 | 510,075 |
Depreciation, depletion, amortization and accretion | 20,400 | 26,646 | 61,584 | 96,594 |
Rentals [Member] | ||||
Revenues: | ||||
Total revenues | 42,562 | 99,771 | 196,006 | 282,819 |
Costs and expenses: | ||||
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) | 22,879 | 39,119 | 83,904 | 119,656 |
Depreciation, depletion, amortization and accretion | 9,145 | 15,500 | 32,633 | 46,958 |
Product Sales [Member] | ||||
Revenues: | ||||
Total revenues | 27,365 | 45,274 | 108,426 | 117,230 |
Costs and expenses: | ||||
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) | 11,819 | 30,339 | 69,684 | 71,781 |
Depreciation, depletion, amortization and accretion | $ 5,627 | $ 3,016 | $ 19,096 | $ 9,224 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Condensed Consolidated Statements of Comprehensive Loss [Abstract] | ||||
Net loss | $ (157,304) | $ (38,441) | $ (301,874) | $ (157,196) |
Change in cumulative translation adjustment, net of tax | 4,216 | (2,967) | (607) | (3,810) |
Comprehensive loss | $ (153,088) | $ (41,408) | $ (302,481) | $ (161,006) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Cash flows from operating activities: | |||||||
Net loss | $ (157,304) | $ (79,464) | $ (38,441) | $ (47,705) | $ (301,874) | $ (157,196) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation, depletion, amortization and accretion | 113,313 | 225,044 | |||||
Deferred income taxes | 352 | ||||||
Reduction in value of assets | 19,451 | 40,952 | |||||
Reduction in value of assets held for sale | 109,591 | ||||||
Right-of-use assets amortization | 14,738 | 16,341 | |||||
Stock-based compensation expense | 6,074 | 14,155 | |||||
Other reconciling items, net | (3,537) | (9,340) | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 126,439 | 68,239 | |||||
Prepaid expenses | 352 | (20,012) | |||||
Inventory and other current assets | 15,380 | (19,966) | |||||
Accounts payable | (35,828) | (8,221) | |||||
Accrued expenses | (26,409) | (25,054) | |||||
Income taxes | (3,114) | 3,314 | |||||
Other, net | (16,331) | (11,752) | |||||
Net cash provided by operating activities | 18,597 | 116,504 | |||||
Cash flows from investing activities: | |||||||
Payments for capital expenditures | (37,408) | (105,393) | |||||
Proceeds from sales of assets | 44,097 | 90,696 | |||||
Net cash provided by (used in) investing activities | 6,689 | (14,697) | |||||
Cash flows from financing activities: | |||||||
Delayed draw term loan commitment fee | (11,700) | ||||||
Principal payments on long-term debt | (1,300,000) | ||||||
Tax withholdings for vested restricted stock units | (208) | (1,677) | |||||
Other | (432) | 621 | |||||
Net cash used in financing activities | (12,340) | (1,056) | |||||
Effect of exchange rate changes on cash | (378) | (1,857) | |||||
Net change in cash, cash equivalents, and restricted cash | 12,568 | 98,894 | |||||
Cash, cash equivalents, and restricted cash at beginning of period | $ 275,388 | $ 163,748 | 275,388 | 163,748 | $ 163,748 | ||
Cash, cash equivalents, and restricted cash at end of period | $ 287,956 | $ 262,642 | $ 287,956 | $ 262,642 | $ 275,388 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Loss, Net [Member] | Accumulated Deficit [Member] | Total |
Balances at Dec. 31, 2018 | $ 155 | $ 2,735,125 | $ (73,177) | $ (2,371,364) | $ 290,739 | |
Beginning balance, shares at Dec. 31, 2018 | 15,488,542 | |||||
Net loss | (47,705) | (47,705) | ||||
Foreign currency translation adjustment | 1,073 | 1,073 | ||||
Stock-based compensation expense, net of forfeitures | 5,625 | 5,625 | ||||
Transactions under stock plans, value | $ 1 | (1,667) | (1,666) | |||
Transactions under stock plans, shares | 107,118 | |||||
Balances at Mar. 31, 2019 | $ 156 | 2,739,083 | (72,104) | (2,419,069) | 248,066 | |
Ending balance, shares at Mar. 31, 2019 | 15,595,660 | |||||
Balances at Dec. 31, 2018 | $ 155 | 2,735,125 | (73,177) | (2,371,364) | 290,739 | |
Beginning balance, shares at Dec. 31, 2018 | 15,488,542 | |||||
Net loss | (157,196) | |||||
Foreign currency translation adjustment | (3,810) | |||||
Balances at Sep. 30, 2019 | $ 157 | 2,748,477 | (76,987) | (2,528,560) | 143,087 | |
Ending balance, shares at Sep. 30, 2019 | 15,657,357 | |||||
Balances at Dec. 31, 2018 | $ 155 | 2,735,125 | (73,177) | (2,371,364) | 290,739 | |
Beginning balance, shares at Dec. 31, 2018 | 15,488,542 | |||||
Balances at Dec. 31, 2019 | $ 16 | 2,752,859 | $ (4,290) | (71,927) | (2,627,085) | 49,573 |
Ending balance, shares at Dec. 31, 2019 | 15,689,463 | |||||
Balances at Mar. 31, 2019 | $ 156 | 2,739,083 | (72,104) | (2,419,069) | 248,066 | |
Beginning balance, shares at Mar. 31, 2019 | 15,595,660 | |||||
Net loss | (71,050) | (71,050) | ||||
Foreign currency translation adjustment | (1,916) | (1,916) | ||||
Stock-based compensation expense, net of forfeitures | 4,650 | 4,650 | ||||
Transactions under stock plans, value | (10) | (10) | ||||
Transactions under stock plans, shares | 11,637 | |||||
Shares issued under Employee Stock Purchase Plan, value | $ 1 | 650 | 651 | |||
Shares issued under Employee Stock Purchase Plan | 50,019 | |||||
Balances at Jun. 30, 2019 | $ 157 | 2,744,373 | (74,020) | (2,490,119) | 180,391 | |
Ending balance, shares at Jun. 30, 2019 | 15,657,316 | |||||
Net loss | (38,441) | (38,441) | ||||
Foreign currency translation adjustment | (2,967) | (2,967) | ||||
Stock-based compensation expense, net of forfeitures | 4,104 | 4,104 | ||||
Transactions under stock plans, shares | 41 | |||||
Balances at Sep. 30, 2019 | $ 157 | 2,748,477 | (76,987) | (2,528,560) | 143,087 | |
Ending balance, shares at Sep. 30, 2019 | 15,657,357 | |||||
Balances at Dec. 31, 2019 | $ 16 | 2,752,859 | (4,290) | (71,927) | (2,627,085) | 49,573 |
Beginning balance, shares at Dec. 31, 2019 | 15,689,463 | |||||
Net loss | (79,464) | (79,464) | ||||
Foreign currency translation adjustment | (4,538) | (4,538) | ||||
Stock-based compensation expense, net of forfeitures | 2,527 | 2,527 | ||||
Transactions under stock plans, value | (208) | (208) | ||||
Transactions under stock plans, shares | 108,965 | |||||
Balances at Mar. 31, 2020 | $ 16 | 2,755,178 | (4,290) | (76,465) | (2,706,549) | (32,110) |
Ending balance, shares at Mar. 31, 2020 | 15,798,428 | |||||
Balances at Dec. 31, 2019 | $ 16 | 2,752,859 | (4,290) | (71,927) | (2,627,085) | 49,573 |
Beginning balance, shares at Dec. 31, 2019 | 15,689,463 | |||||
Net loss | (301,874) | |||||
Foreign currency translation adjustment | (607) | |||||
Balances at Sep. 30, 2020 | $ 16 | 2,756,031 | (4,290) | (72,534) | (2,928,959) | (249,736) |
Ending balance, shares at Sep. 30, 2020 | 15,799,318 | |||||
Balances at Mar. 31, 2020 | $ 16 | 2,755,178 | (4,290) | (76,465) | (2,706,549) | (32,110) |
Beginning balance, shares at Mar. 31, 2020 | 15,798,428 | |||||
Net loss | (65,106) | (65,106) | ||||
Foreign currency translation adjustment | (285) | (285) | ||||
Stock-based compensation expense, net of forfeitures | 2,374 | 2,374 | ||||
Transactions under stock plans, shares | 611 | |||||
Balances at Jun. 30, 2020 | $ 16 | 2,757,552 | (4,290) | (76,750) | (2,771,655) | (95,127) |
Ending balance, shares at Jun. 30, 2020 | 15,799,039 | |||||
Net loss | (157,304) | (157,304) | ||||
Foreign currency translation adjustment | 4,216 | 4,216 | ||||
Stock-based compensation expense, net of forfeitures | (1,521) | (1,521) | ||||
Transactions under stock plans, shares | 279 | |||||
Balances at Sep. 30, 2020 | $ 16 | $ 2,756,031 | $ (4,290) | $ (72,534) | $ (2,928,959) | $ (249,736) |
Ending balance, shares at Sep. 30, 2020 | 15,799,318 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | (1) Basis of Presentation Certain information and footnote disclosures normally in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC); however, management believes the disclosures that are made are adequate to make the information presented not misleading. These financial statements and notes should be read in conjunction with the consolidated financial statements and notes thereto included in Superior Energy Services, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2019, and Management’s Discussion and Analysis of Financial Condition and Results of Operations herein. The financial information of Superior Energy Services, Inc. and its subsidiaries (the Company) for the three and nine months ended September 30, 2020 and 2019 has not been audited. However, in the opinion of management, all adjustments necessary to present fairly the results of operations for the periods presented have been included therein. Certain previously reported amounts have been reclassified to conform to the 2020 presentation. The results of operations for the first nine months of the year are not necessarily indicative of the results of operations that might be expected for the entire year. The Company evaluates events that occur after the balance sheet date but before the financial statements are issued for potential recognition or disclosure. Recent Developments Voluntary Reorganization Under Chapter 11 of the U.S. Bankruptcy Code Superior Energy Services, Inc. and certain of its direct and indirect wholly-owned domestic subsidiaries (collectively, the Debtors) plan to file voluntary petitions (the Chapter 11 Cases) for relief (the Bankruptcy Filing) under Chapter 11 of Title 11 of the United States Code (the Bankruptcy Code) in the United States Bankruptcy Court for the Southern District of Texas (the Bankruptcy Court). The Debtors plan to commence a solicitation for acceptance of their prepackaged plan of reorganization (the Plan) by causing the Plan and the corresponding disclosure statement to be distributed to certain creditors of the Company shortly before the Bankruptcy Filing. During the Chapter 11 Cases the Debtors will continue to operate their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. Upon filing the Chapter 11 Cases, the Debtors will request that the Bankruptcy Court grant certain relief to ensure a seamless transition of operations through the Chapter 11 Cases. As a result, the Debtors expect to be able to conduct their business operations in the ordinary course of business. During the pendency of the Chapter 11 Cases, all transactions outside the ordinary course of business will require the prior approval of the Bankruptcy Court. Automatic Stay Subject to specific exceptions under the Bankruptcy Code, the filing of the Chapter 11 Cases will automatically stay all judicial or administrative actions against the Debtors and efforts by creditors to collect on or otherwise exercise rights or remedies with respect to claims arising prior to the Bankruptcy Filing. Absent an order from the Bankruptcy Court, if the Bankruptcy Filing is made, substantially all of the Debtors’ liabilities prior to the Bankruptcy Filing will be subject to settlement under the Bankruptcy Code. Executory Contracts Subject to certain exceptions, under the Bankruptcy Code, the Debtors may, upon filing of the Chapter 11 Cases, assume, assign, or reject certain executory contracts and unexpired leases subject to the approval of the Bankruptcy Court and certain other conditions. Generally, the rejection of an executory contract or unexpired lease is treated as a pre-petition breach of such executory contract or unexpired lease and, subject to certain exceptions, relieves the Debtors from performing their future obligations under such executory contract or unexpired lease. However, such rejection entitles the contract counterparty or lessor to a pre-petition general unsecured claim for damages caused by such deemed breach. Counterparties to rejected contracts or leases may assert unsecured claims in the Bankruptcy Court against the Debtors estate for such damages. Generally, the assumption of an executory contract or unexpired lease requires the Debtors to cure existing monetary defaults under such executory contract or unexpired lease and provide adequate assurance of future performance. Accordingly, any description of an executory contract or unexpired lease with the Debtors, including, where applicable, a quantification of the Debtors’ obligations under any such executory contract or unexpired lease of the Debtors, is qualified by any overriding rejection rights the Debtors expect to have under the Bankruptcy Code. Restructuring Support Agreement As previously disclosed in the Company’s Current Reports on Form 8-K filed on September 30, 2020 and October 28, 2020, on September 29, 2020, the Company entered into that certain restructuring support agreement (as amended, modified, or supplemented to date, the RSA) with certain holders (collectively, the Ad Hoc Noteholders Group) of 7.125 % senior unsecured notes due 2021 (the 2021 Notes) and 7.750 % senior unsecured notes due 2024 (together with the 2021 Notes, the Prepetition Notes), both issued by SESI, L.L.C. Under the terms of the RSA, the Debtors and the Ad Hoc Noteholder Group agreed to a series of deleveraging transactions (the Restructuring ) that will eliminate approximately $ 1.30 billion of funded debt obligations of the Debtors through the Plan. Specifically, the Restructuring contemplates, among other things, the equitization of all amounts outstanding under the Debtors’ Prepetition Notes. In exchange for equitizing all of their funded debt, holders of Prepetition Notes (the Prepetition Noteholders) will receive 98 % of the new common stock to be issued by the reorganized Company (the New Common Stock). Holders of existing prepetition equity will receive 2 % of the New Common Stock and five-year warrants to purchase 10.0% of the New Common Stock (the New Warrants), subject to and in accordance with the terms set forth in the RSA. General unsecured creditors will remain unimpaired and be paid in the ordinary course of business. The RSA further provides, in pertinent part, as follows: All holders of Prepetition Notes that are accredited investors or qualified institutional buyers, will have the opportunity, but not the obligation, to exercise the subscription rights to purchase New Common Stock. The proceeds of the Equity Rights Offering will be used exclusively to fund the Cash Payout provided to Prepetition Noteholders electing the Cash Payout, in full and final satisfaction of such Holders’ Prepetition Notes Claims, which will be released and discharged pursuant to the Plan. Consummation of the Equity Rights Offering is contingent upon the consent of the Required Consenting Noteholders under the RSA; Eligible holders of the Prepetition Notes Claims that do not elect to participate in the Equity Rights Offering may receive a cash distribution of an amount yet to be determined (the Cash Payout). The proceeds from the Equity Rights Offering will be used to fund the cash distributions under the Cash Payout, provided that the total Cash Payout distribution amount will not exceed the total amount of the proceeds of the Equity Rights Offering. Any remaining portion of such holder’s Prepetition Notes Claims that is not satisfied through the Cash Payout will receive the treatment such holder would receive if such holder elected to participate in the Equity Rights Offering. The Cash Payout is contingent upon the consent of the Required Consenting Noteholders under the RSA; The board of directors of the reorganized Company (the New Board) will be authorized to implement a management incentive plan (the New Management Incentive Plan) that provides for the issuance of equity-based compensation to the management and directors of the Company and its subsidiaries. Up to 10 % of the New Common Stock, on a fully diluted basis, will be reserved for issuance in connection with the New Management Incentive Plan, with the actual amount to be reserved as determined by the New Board; and In consideration for entry into the RSA, each Prepetition Noteholder that became a party to the RSA (a Consenting Noteholder) prior to a deadline set forth in the RSA was paid a premium payable in cash equal to the accrued interest outstanding as of the RSA effective date under the Notes held by each Consenting Noteholder. These expenses, as well as various advisory and professional fees related to the restructuring of the Company, are recorded under the caption “Restructuring expense” on the condensed consolidated statements of operations. Restructuring expenses totaled approximately $ 25.7 million and $ 27.0 million for the three and nine months ended September 30, 2020, respectively. Also included in this line item is $15.6 million related to the RSA premium paid to certain Consenting Noteholders pursuant to the RSA. Under the Plan, certain classes of claims are expected to receive the following treatment: Administrative expense claims, priority tax claims, other priority claims, and other secured claims will be paid in full (or receive such other treatment rendering such claims unimpaired); Claims on account of the Company’s asset-based revolving credit facility (the Prepetition Credit Agreement), other than those claims related to any outstanding letters of credit, will be paid in full in cash; Contingent claims arising from outstanding letters of credit under the Prepetition Credit Agreement that remain undrawn upon consummation of the Chapter 11 Cases will either (i) be 105 % cash collateralized, (ii) be deemed outstanding under an asset-based revolving exit credit facility, if any, or (iii) receive such other treatment as may be acceptable to the Debtors, the agent and lenders under the Prepetition Credit Agreement, and at least three unaffiliated Consenting Noteholders holding at least 66.6 % of the aggregate principal amount of the Prepetition Notes; General unsecured creditors will remain unimpaired and are to receive payment in cash, in full, in the ordinary course; The Company’s existing equity will be cancelled and exchanged for (i) 2.0 % of the New Common Stock (subject to dilution on account of (x) New Common Stock issued upon exercise of the New Warrants and (y) New Common Stock issued under the New Management Incentive Plan) and (ii) the New Warrants; Eligible holders of the Prepetition Notes who elect to participate in the Equity Rights Offering will receive their pro rata share of (i) 98 % of New Common Stock (subject to dilution on account of (x) New Common Stock issued upon exercise of the New Warrants and (y) New Common Stock issued to management of the Reorganized Debtors under the New Management Incentive Plan) and (ii) rights to participate in the Equity Rights Offering; and Eligible holders of the Prepetition Notes who elect cash instead of participating in the Equity Rights Offering will receive their pro rata share of cash in an aggregate amount equal to a percentage of the amount due under the Prepetition Notes to all such holders. The RSA contains certain covenants binding the Company and the Consenting Noteholders, including limitations on the parties’ ability to pursue alternative transactions, commitments by the Consenting Noteholders to vote in favor of the Plan, and commitments of the Company and the Consenting Noteholders to cooperate in good faith to finalize the documents and agreements contemplated by the RSA and the associated term sheet. The RSA also sets forth certain milestones to ensure that the Company emerges from bankruptcy as swiftly as practicable. Although the Company intends to pursue the Chapter 11 Cases in accordance with the terms set forth in the RSA, there can be no assurance that the Company will be successful in completing the transactions outlined in the RSA, whether on the same or different terms. Delayed-Draw Term Loan Commitment Letter As previously disclosed in the Company’s Current Report on Form 8-K filed on September 30, 2020, on September 29, 2020, the Company entered into a Commitment Letter (the Delayed-Draw Term Loan Commitment Letter) with certain of the Consenting Noteholders (such Consenting Noteholders, the Backstop Commitment Parties). Pursuant to the terms of the RSA, in connection with confirmation of the Plan, the Company will use reasonable efforts to obtain ABL Financing Commitments (as defined in the RSA). In the event that all or a portion of the ABL Financing Commitments is not obtained, the Backstop Commitment Parties have committed to provide a delayed draw term loan facility (the Delayed-Draw Term Loan Facility) in an aggregate principal amount not to exceed $ 200 million, upon the Company’s emergence from bankruptcy on the terms and subject to the conditions of the Delayed-Draw Term Loan Commitment Letter. As consideration for the commitment to provide the Delayed-Draw Term Loan Facility, the Company paid $ 11.7 million to the Backstop Commitment Parties. The transactions contemplated by the Delayed-Draw Term Loan Commitment Letter are conditioned upon the satisfaction or waiver of customary conditions for transactions of this nature. Going Concern Recent developments discussed above have negatively impacted the Company's financial condition and the Company's current forecast gives doubt to the Company's available liquidity to repay its outstanding debt or meet its obligations. The Company’s bond and share price declines, as well as the Company’s credit rating, have over time increased the level of uncertainty in the Company’s business and impacted various key stakeholders, including the Company’s employees, customers, suppliers and key lenders. These conditions and events indicate that there is substantial doubt about the Company's ability to continue as a going concern. As noted above, in response to these developments, the Debtors expect to make the Bankruptcy Filing. Although the Company anticipates that the Chapter 11 Cases, if commenced, will help address its liquidity concerns, there are a number of risks and uncertainties surrounding the Chapter 11 Cases, including the uncertainty remaining over the Bankruptcy Court's approval of the Plan, which are not within the Company's control. Therefore, management has concluded that management’s current actions and plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. As of September 30, 2020, the Company’s unaudited condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. In addition, the Company’s unaudited condensed consolidated financial statements do not reflect any adjustments related to bankruptcy or liquidation accounting. COVID-19 Pandemic and Market Conditions The Company’s operations continue to be disrupted due to the circumstances surrounding the COVID-19 pandemic. The significant business disruption resulting from the COVID-19 pandemic has impacted customers, vendors and suppliers in all geographical areas where the Company operates. The closure of non-essential business facilities and restrictions on travel put in place by governments around the world have significantly reduced economic activity. Also, the COVID-19 pandemic has impacted and may further impact the broader economies of affected countries, including negatively impacting economic growth, the proper functioning of financial and capital markets, foreign currency exchange rates, and interest rates. For example, the continued spread of COVID-19 has led to disruption and volatility in the global capital markets, which increases the cost of capital and adversely impacts access to capital. Additionally, recognized health risks associated with the COVID-19 pandemic have altered the policies of companies operating around the world, resulting in these companies instituting safety programs similar to what both domestic and international governmental agencies have implemented, including stay at home orders, social distancing mandates, and other community oriented health objectives. The Company is complying with all such ordinances in its operations across the globe. Management of the Company believes it has proactively addressed many of the known operational impacts of the COVID-19 pandemic to the extent possible and will strive to continue to do so, but there can be no guarantee the measures will be fully effective. Furthermore, the oil and gas industry has experienced unprecedented price disruptions during 2020, due in part to significantly decreased demand as a result of the COVID-19 pandemic, as activity declined in the face of depressed crude oil pricing. The U.S. oil and gas rig count fell by more than 60 % in the second quarter of 2020 and by more than 30 % in the third quarter of 2020. The number of oil and gas rigs outside of the U.S. and Canada fell by more than 10 % in the third quarter of 2020 to an average of 731 rigs from 834 rigs in the second quarter of 2020. These market conditions have significantly impacted the Company’s business, with third quarter 2020 revenue decreasing to $ 166.9 million, as compared to $ 356.6 million in the third quarter of 2019, or 53 %. As customers continue to revise their capital budgets in order to adjust spending levels in response to lower commodity prices, the Company has experienced significant pricing pressure for its products and services. Low oil prices and industry volatility are likely to continue through the near and long-term. As the global outbreak of the COVID-19 pandemic continues to rapidly evolve, management expects it to continue to materially and adversely affect the Company’s revenue, financial condition, profitability, and cash flow for an indeterminate period of time. New York Stock Exchange Delisting On September 17, 2020, the Company was notified by the New York Stock Exchange (the NYSE) that the Company is no longer in compliance with the NYSE continued listing standards set forth in Section 802.01B of the NYSE Listed Company Manual due to the Company’s failure to maintain an average global market capitalization over a consecutive 30-day trading period of at least $15 million and accordingly, the NYSE had determined to commence proceedings to delist the Company’s common stock from the NYSE. Trading of the Company’s common stock on the NYSE was suspended effective as of approximately 4:00 p.m. Eastern Time on September 17, 2020. On September 18, 2020, the Company’s common stock commenced trading on the OTCQX marketplace under the trading symbol “SPNX.” On October 2, 2020, the NYSE applied to the SEC to delist the Company’s common stock from trading on the NYSE and to remove it from registration under Section 12(b) of the Securities Exchange Act of 1934, as amended (the Exchange Act). The delisting became effective 10 days after the filing of the Form 25. In accordance with Rule 12d2-2 of the Exchange Act, the de-registration of the Company’s common stock under Section 12(b) of the Exchange Act will become effective 90 days, or such shorter period as the SEC may determine, from the date of the Form 25 filing. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2020 | |
Revenue [Abstract] | |
Revenue | (2) Revenue Revenue Recognition Revenues are recognized when performance obligations are satisfied in accordance with contractual terms, in an amount that reflects the consideration the Company expects to be entitled to in exchange for services rendered, rentals provided, and products sold. Taxes collected from customers and remitted to governmental authorities and revenues are reported on a net basis in the Company’s financial statements. Performance Obligations A performance obligation arises under contracts with customers to render services, provide rentals or sell products, and is the unit of account under Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) . The Company accounts for services rendered and rentals provided separately if they are distinct and the service or rental is separately identifiable from other items provided to a customer and if a customer can benefit from the services rendered or rentals provided on its own or with other resources that are readily available to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. A contract’s standalone selling prices are determined based on the prices that the Company charges for its services rendered, rentals provided, and products sold. The majority of the Company’s performance obligations are satisfied over time, which is generally represented by a period of 30 days or less. The Company’s payment terms vary by the type of products or services offered. The term between invoicing and when the payment is due is typically 30 days. Services Revenue: primarily represents amounts charged to customers for the completion of services rendered, including labor, products and supplies necessary to perform the service. Rates for these services vary depending on the type of services provided and can be based on a per job, per hour or per day basis. Rentals Revenue: primarily priced on a per day, per man hour or similar basis and consists of fees charged to customers for the use of the Company’s rental equipment over the term of the rental period, which is generally less than twelve months. Product Sales Revenue: products are generally sold based upon purchase orders or contracts with the Company’s customers that include fixed or determinable prices but do not include right of return provisions or other significant post-delivery obligations. The Company recognizes revenue from product sales when title passes to the customer, the customer assumes risks and rewards of ownership, collectability is reasonably assured and delivery occurs as directed by the customer. The Company expenses sales commissions when incurred because the amortization period would be one year or less. Disaggregation of revenue The following table presents the Company’s revenues by segment disaggregated by geography (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 U.S. land Drilling Products and Services $ 10,458 $ 46,590 $ 66,652 $ 142,073 Onshore Completion and Workover Services 21,559 75,973 103,957 273,727 Production Services 9,777 32,620 51,541 112,095 Technical Solutions 4,694 7,283 13,997 32,589 Total U.S. land $ 46,488 $ 162,466 $ 236,147 $ 560,484 U.S. offshore Drilling Products and Services $ 26,242 $ 33,895 $ 92,053 $ 91,048 Onshore Completion and Workover Services - - - - Production Services 6,630 18,295 24,292 58,977 Technical Solutions 15,740 40,771 70,884 95,195 Total U.S. offshore $ 48,612 $ 92,961 $ 187,229 $ 245,220 International Drilling Products and Services $ 19,301 $ 30,700 $ 68,639 $ 79,825 Onshore Completion and Workover Services - - - - Production Services 39,948 47,872 136,519 134,167 Technical Solutions 12,579 22,586 43,744 69,601 Total International $ 71,828 $ 101,158 $ 248,902 $ 283,593 Total Revenues $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 The following table presents the Company’s revenues by segment disaggregated by type (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Services Drilling Products and Services $ 11,130 $ 18,835 $ 38,719 $ 52,997 Onshore Completion and Workover Services 20,461 67,022 94,277 245,055 Production Services 44,550 85,188 167,081 262,658 Technical Solutions 20,860 40,495 67,769 128,538 Total Services $ 97,001 $ 211,540 $ 367,846 $ 689,248 Rentals Drilling Products and Services $ 38,786 $ 78,714 $ 161,188 $ 221,306 Onshore Completion and Workover Services 1,098 8,951 9,680 28,672 Production Services 2,246 9,216 16,106 25,068 Technical Solutions 432 2,890 9,032 7,773 Total Rentals $ 42,562 $ 99,771 $ 196,006 $ 282,819 Product Sales Drilling Products and Services $ 6,085 $ 13,636 $ 27,437 $ 38,643 Onshore Completion and Workover Services - - - - Production Services 9,559 4,383 29,165 17,513 Technical Solutions 11,721 27,255 51,824 61,074 Total Product Sales $ 27,365 $ 45,274 $ 108,426 $ 117,230 Total Revenues $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2020 | |
Inventory [Abstract] | |
Inventory | (3) Inventory Inventories are stated at the lower of cost or net realizable value. The Company applies net realizable value and obsolescence to the gross value of the inventory. Cost is determined using the first-in, first-out or weighted-average cost methods for finished goods and work-in-process. Supplies and consumables primarily consist of products used in our services provided to customers. The components of the inventory balances are as follows (in thousands): September 30, 2020 December 31, 2019 Finished goods $ 42,180 $ 45,127 Raw materials 15,633 16,130 Work-in-process 6,329 9,360 Supplies and consumables 33,723 33,322 Total $ 97,865 $ 103,939 |
Notes Receivable
Notes Receivable | 9 Months Ended |
Sep. 30, 2020 | |
Notes Receivable [Abstract] | |
Notes Receivable | (4) Notes Receivable Notes receivable consist of a commitment from the seller of an oil and gas property acquired by the Company related to costs associated with the abandonment of the acquired property. Pursuant to an agreement with the seller, the Company invoices the seller an agreed upon amount at the completion of certain decommissioning activities. The gross amount of this obligation totals $ 115.0 million and is recorded at present value using an effective interest rate of 6.58 %. The related discount is amortized to interest income based on the expected timing of completion of the decommissioning activities. The Company recorded interest income related to notes receivable of $ 3.4 million and $ 3.1 million for the nine months ended September 30, 2020 and 2019, respectively. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt [Abstract] | |
Debt | (5) Debt The Company’s outstanding debt is as follows (in thousands): September 30, 2020 December 31, 2019 Stated Interest Rate (%) Long-term Senior unsecured notes due September 2024 7.750 $ 500,000 $ 500,000 Senior unsecured notes due December 2021 7.125 800,000 800,000 Total debt, gross 1,300,000 1,300,000 Unamortized debt issuance costs ( 10,712 ) ( 13,371 ) Total debt, net $ 1,289,288 $ 1,286,629 Credit Facility The Company has an asset-based revolving credit facility which matures in October 2022. The borrowing base under the credit facility is calculated based on a formula referencing the borrower’s and the subsidiary guarantors’ eligible accounts receivable, eligible inventory and eligible premium rental drill pipe less reserves. Availability under the credit facility is the lesser of (i) the commitments, (ii) the borrowing base and (iii) the highest principal amount permitted to be secured under the indenture governing the 7.125 % senior unsecured notes due 2021. At September 30, 2020, the borrowing base under the asset-based revolving credit facility was $ 97.3 million and the Company had $ 48.5 million of letters of credit outstanding that reduced its borrowing availability under the revolving credit facility. The credit agreement contains various covenants, including, but not limited to, limitations on the incurrence of indebtedness, permitted investments, liens on assets, making distributions, transactions with affiliates, merger, consolidations, dispositions of assets and other provisions customary in similar types of agreements. On August 5, 2020, the Company amended its asset-based revolving credit facility to permit the Company to use up to the lesser of (i) $ 100 million and (ii) 105 % of the face value of certain third-party letters of credit, surety, judgment, appeal or performance bonds, and similar obligations of the Company, to cash collateralize such obligations. The Company also deposited $ 25 million in an account under the lenders’ control to further secure its obligations under the revolving credit facility. The Company reduced the amount of letters of credit issued through the credit facility by using $ 52.4 million to cash collateralize these obligations. The amendment also prohibits the Company from requesting any loans under the credit facility and also restricts the Company’s flexibility under certain of the investment, indebtedness, junior debt repayment and restricted payment covenants. Senior Unsecured Notes The Company has outstanding $ 800 million of senior unsecured notes due December 2021. The indenture governing the 7.125 % senior unsecured notes due 2021 requires semi-annual interest payments on June 15 and December 15 of each year through the maturity date of December 15, 2021. The Company also has outstanding $ 500 million of senior unsecured notes due September 2024. The indenture governing the 7.75 % senior unsecured notes due 2024 requires semi-annual interest payments on March 15 and September 15 of each year through the maturity date of September 15, 2024. If the Debtors file the Chapter 11 Cases, the principal and interest due under these debt instruments will become immediately due and payable. However, section 362 of the Bankruptcy Code will stay the creditors from taking any action as a result of the default. Any efforts to enforce such payment obligations under the unsecured notes or other accelerated obligations of the Debtors will be automatically stayed as a result of the Chapter 11 Cases, and the creditors’ rights of enforcement in respect of the unsecured notes, the credit facility and other accelerated obligations of the Debtors will be subject to the applicable provisions of the Bankruptcy Code. |
Decommissioning Liabilities
Decommissioning Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Decommissioning Liabilities [Abstract] | |
Decommissioning Liabilities | (6) Decommissioning Liabilities The Company’s decommissioning liabilities associated with an oil and gas property and its related assets include liabilities related to the plugging of wells, removal of the related platform and equipment, and site restoration. The Company reviews the adequacy of its decommissioning liabilities whenever indicators suggest that the estimated cash flows and/or relating timing needed to satisfy the liability have changed materially. The Company had decommissioning liabilities of $ 141.1 million and $ 136.3 million at September 30, 2020 and December 31, 2019, respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Leases | (7) Leases Accounting Policy for Leases The Company determines if an arrangement is a lease at inception. All of the Company’s leases are operating leases and are included in right-of-use (ROU) assets, accounts payable and operating lease liabilities in the condensed consolidated balance sheet. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligations to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the respective lease term. The Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company’s lease terms may include options to extend or terminate the lease. The Company has changed its position regarding exercising certain operating lease renewal options given the current industry conditions related to the COVID-19 pandemic. At September 30, 2020, this change resulted in a decrease to the operating lease ROU assets and liabilities of $ 10.7 million. Overview The Company’s operating leases are primarily for real estate, machinery and equipment, and vehicles. The terms and conditions for these leases vary by the type of underlying asset. Subject to certain exceptions, if the Debtors make the Bankruptcy Filing, under the Bankruptcy Code, the Company may assume, assign, or reject certain executory contracts and unexpired leases subject to the approval of the Bankruptcy Court and certain other conditions. Total operating lease expense was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Long-term fixed lease expense $ 4,032 $ 8,942 $ 18,043 $ 25,507 Long-term variable lease expense 85 117 285 298 Short-term lease expense 1,652 3,346 8,175 13,216 Total operating lease expense $ 5,769 $ 12,405 $ 26,503 $ 39,021 Supplemental Balance Sheet and Cash Flows Information Operating leases were as follows (in thousands): September 30, 2020 December 31, 2019 Operating lease ROU assets $ 56,198 $ 80,906 Accrued expenses $ 19,622 $ 21,072 Operating lease liabilities 38,649 62,354 Total operating lease liabilities $ 58,271 $ 83,426 Weighted average remaining lease term 8 years 9 years Weighted average discount rate 6.51 % 6.75 % Nine Months Ended September 30, 2020 2019 Cash paid for operating leases $ 20,806 $ 26,242 ROU assets obtained in exchange for lease obligations $ 3,513 $ 21,045 Maturities of operating lease liabilities at September 30, 2020 are as follows (in thousands): Remainder of 2020 $ 7,265 2021 21,905 2022 14,546 2023 10,977 2024 8,210 Thereafter 28,780 Total lease payments 91,683 Less imputed interest ( 33,412 ) Total $ 58,271 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | (8) Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or the price paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inputs used in determining fair value are characterized according to a hierarchy that prioritizes those inputs based on the degree to which they are observable. The three input levels of the fair value hierarchy are as follows. Level 1 : Unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 : Observable inputs other than those included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical assets or liabilities in inactive markets; or model-derived valuations or other inputs that can be corroborated by observable market data. Level 3 : Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability. The following tables provide a summary of the financial assets and liabilities measured at fair value on a recurring basis (in thousands): Fair Value at September 30, 2020 Level 1 Level 2 Level 3 Total Intangible and other long-term assets, net: Non-qualified deferred compensation assets $ - $ 14,252 $ - $ 14,252 Accounts payable: Non-qualified deferred compensation liabilities $ - $ 2,741 $ - $ 2,741 Other long-term liabilities: Non-qualified deferred compensation liabilities $ - $ 19,530 $ - $ 19,530 Total debt $ 350,100 $ - $ - $ 350,100 Fair Value at December 31, 2019 Level 1 Level 2 Level 3 Total Intangible and other long-term assets, net: Non-qualified deferred compensation assets $ - $ 15,499 $ - $ 15,499 Accounts payable: Non-qualified deferred compensation liabilities $ - $ 1,372 $ - $ 1,372 Other long-term liabilities: Non-qualified deferred compensation liabilities $ - $ 23,466 $ - $ 23,466 Total debt $ 1,021,300 $ - $ - $ 1,021,300 The Company’s non-qualified deferred compensation plans allow officers, certain highly compensated employees and non-employee directors to defer receipt of a portion of their compensation and contribute such amounts to one or more hypothetical investment funds. These investments are reported at fair value based on unadjusted quoted prices in active markets for identifiable assets and observable inputs for similar assets and liabilities, which represent Levels 1 and 2, respectively, in the fair value hierarchy. Commencement of the Chapter 11 Cases will automatically stay payments under the non-qualified deferred compensation plans. The carrying amount of cash equivalents, accounts receivable, accounts payable and accrued expenses, as reflected in the condensed consolidated balance sheets, approximates fair value due to the short maturities. The fair value of the debt instruments is determined by reference to the market value of such instruments as quoted in an over-the-counter market, which represents Level 1 in the fair value hierarchy. The following table reflects the fair value measurements used in testing the impairment of long-lived assets (in thousands): Nine Months Ended September 30, Impairment Fair Value Property, plant and equipment, net $ 19,451 $ 13,593 Fair value is measured as of impairment date using Level 3 inputs. See Note 10 for a discussion of the reduction in value of assets recorded during the nine months ended September 30, 2020. While the Company believes that it will continue to operate in the ordinary course during the Chapter 11 Cases and upon emergence from the Chapter 11 Cases, the Company’s estimates of fair values are sensitive to inputs to the valuation approaches, including forecasts of revenues and earnings growth. There can be no assurances that changes to the Company’s inputs would not result in a material impairment of goodwill. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2020 | |
Segment Information [Abstract] | |
Segment Information | (9) Segment Information Business Segments The Drilling Products and Services segment rents and sells premium drill pipe, bottom hole assemblies, tubulars and specialized equipment for use with onshore and offshore oil and gas well drilling, completion, production and workover activities. It also provides on-site accommodations and machining services. The Onshore Completion and Workover Services segment provides fluid handling services and workover and maintenance services. The Production Services segment provides intervention services such as coiled tubing, cased hole and mechanical wireline, hydraulic workover and snubbing, production testing and optimization, and remedial pumping services. The Technical Solutions segment provides services typically requiring specialized engineering, manufacturing or project planning, including well containment systems, stimulation and sand control services and the production and sale of oil and gas. The Company evaluates the performance of its reportable segments based on income or loss from operations excluding corporate expenses. The segment measure is calculated as follows: segment revenues less segment operating expenses, depreciation, depletion, amortization and accretion expense and reduction in value of assets. The Company uses this segment measure to evaluate its reportable segments because it is the measure that is most consistent with how the Company organizes and manages its business operations. Corporate and other costs primarily include expenses related to support functions, salaries and benefits for corporate employees and stock-based compensation expense. Summarized financial information for the Company’s segments is as follows (in thousands): Three Months Ended September 30, 2020 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 56,001 $ 21,559 $ 56,355 $ 33,013 $ - $ 166,928 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion 23,714 21,943 46,115 24,461 - 116,233 Depreciation, depletion, amortization and accretion 14,424 5,356 9,584 4,983 825 35,172 General and administrative expenses 12,948 3,319 6,801 9,844 22,054 54,966 Restructuring expense - - - - 25,746 25,746 Reduction in value of assets - - - 2,929 - 2,929 Income (loss) from operations 4,915 ( 9,059 ) ( 6,145 ) ( 9,204 ) ( 48,625 ) ( 68,118 ) Interest income (expense), net - - - 1,122 ( 25,916 ) ( 24,794 ) Other income - - - - ( 1,399 ) ( 1,399 ) Income (loss) from continuing operations before income taxes $ 4,915 $ ( 9,059 ) $ ( 6,145 ) $ ( 8,082 ) $ ( 75,940 ) $ ( 94,311 ) Three Months Ended September 30, 2019 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 111,185 $ 75,973 $ 98,787 $ 70,640 $ - $ 356,585 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion 38,663 61,338 82,556 49,370 - 231,927 Depreciation, depletion, amortization and accretion 20,168 6,853 12,063 4,909 1,169 45,162 General and administrative expenses 14,363 8,144 2,905 14,935 20,519 60,866 Reduction in value of assets - 566 1,997 7,008 - 9,571 Income (loss) from operations 37,991 ( 928 ) ( 734 ) ( 5,582 ) ( 21,688 ) 9,059 Interest income (expense), net - - - 1,051 ( 25,556 ) ( 24,505 ) Other income - - - - ( 3,353 ) ( 3,353 ) Income (loss) from continuing operations before income taxes $ 37,991 $ ( 928 ) $ ( 734 ) $ ( 4,531 ) $ ( 50,597 ) $ ( 18,799 ) Nine Months Ended September 30, 2020 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 227,344 $ 103,957 $ 212,352 $ 128,625 $ - $ 672,278 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) 81,163 98,774 177,624 99,161 - 456,722 Depreciation, depletion, amortization and accretion 48,042 17,183 30,604 14,663 2,821 113,313 General and administrative expenses 38,388 12,635 21,232 34,044 72,244 178,543 Restructuring expense - - - - 27,033 27,033 Reduction in value of assets - - 4,096 15,355 - 19,451 Income (loss) from operations 59,751 ( 24,635 ) ( 21,204 ) ( 34,598 ) ( 102,098 ) ( 122,784 ) Interest income (expense), net - - - 3,399 ( 78,076 ) ( 74,677 ) Other expense - - - - ( 4,810 ) ( 4,810 ) Income (loss) from continuing operations before income taxes $ 59,751 $ ( 24,635 ) $ ( 21,204 ) $ ( 31,199 ) $ ( 184,984 ) $ ( 202,271 ) Nine Months Ended September 30, 2019 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 312,946 $ 273,727 $ 305,239 $ 197,385 $ - $ 1,089,297 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) 118,732 217,115 240,855 124,810 - 701,512 Depreciation, depletion, amortization and accretion 64,684 27,940 39,375 17,198 3,579 152,776 General and administrative expenses 44,173 24,044 18,687 46,394 69,717 203,015 Reduction in value of assets - 8,123 1,997 7,008 - 17,128 Income (loss) from operations 85,357 ( 3,495 ) 4,325 1,975 ( 73,296 ) 14,866 Interest income (expense), net - - - 3,104 ( 77,379 ) ( 74,275 ) Other expense - - - - ( 4,476 ) ( 4,476 ) Income (loss) from continuing operations before income taxes $ 85,357 $ ( 3,495 ) $ 4,325 $ 5,079 $ ( 155,151 ) $ ( 63,885 ) Identifiable Assets Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total September 30, 2020 $ 591,152 $ 200,101 $ 367,944 $ 272,893 $ 142,156 $ 1,574,246 December 31, 2019 $ 659,621 467,697 $ 421,848 $ 377,627 $ 66,437 $ 1,993,230 Geographic Segments The Company attributes revenue to various countries based on the location of where services are performed or the destination of the drilling products or equipment sold or rented. Long-lived assets consist primarily of property, plant and equipment and are attributed to various countries based on the physical location of the asset at the end of a period. The Company’s revenue attributed to the U.S. and to other countries and the value of its long-lived assets by those locations are as follows (in thousands): Revenues Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 United States $ 95,100 $ 255,427 $ 423,376 $ 805,704 Other countries 71,828 101,158 248,902 283,593 Total $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 Long-Lived Assets September 30, 2020 December 31, 2019 United States $ 411,974 $ 489,189 Other countries 162,614 175,760 Total $ 574,588 $ 664,949 |
Reduction in Value of Assets
Reduction in Value of Assets | 9 Months Ended |
Sep. 30, 2020 | |
Reduction in Value of Assets [Abstract] | |
Reduction in Value of Assets | (10) Reduction in Value of Assets During the three and nine months ended September 30, 2020, the Company recorded $ 2.9 million and $ 19.5 million, respectively, in connection with the reduction in the value of its long-lived assets. The reduction in value of assets was primarily related to long-lived assets in the Technical Solutions and Production Services segments. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill [Abstract] | |
Goodwill | (11) Goodwill During the third quarter of 2020 the Company entered into the RSA as further described in “Financial Statements - Note 1 – Basis of Presentation.” Entry into the RSA, along with changing industry conditions as a result of the COVID-19 pandemic constituted a triggering event that required the Company to perform an interim goodwill impairment review as of September 30, 2020. The Company performs the goodwill impairment test on an annual basis as of October 1 or more often if events or circumstances indicate there may be an impairment. Goodwill impairment testing is performed at the reporting unit level, which is consistent with the reporting segments. The Company assesses whether any indicators of impairment exist, which requires a significant amount of judgment. Such indicators may include a sustained decrease in the Company’s stock price and market capitalization, a decline in the expected future cash flows, overall weakness in the industry, and slower growth rates. Goodwill impairment exists when the estimated fair value of the reporting unit is below the carrying value. In estimating the fair value of the reporting units, the Company uses a combination of an income approach and a market-based approach. Income approach – The Company discounts the expected cash flows of each reporting unit. The discount rate used represents the estimated weighted average cost of capital, which reflects the overall level of inherent risk involved in the Company’s operations and cash flows and the rate of return an outside investor would expect to earn. Market-based approach – The Company uses the guideline public company method, which focuses on comparing the Company’s risk profile and growth prospects to select reasonably similar publicly traded companies. The Company weighs the income approach 80% and the market-based approach 20% due to differences between the Company’s reporting units and the peer companies’ size, profitability and diversity of operations. In order to validate the reasonableness of the estimated fair values obtained for the reporting units, a reconciliation of fair value to market capitalization is performed for each unit on a standalone basis. A control premium, derived from market transaction data, is used in this reconciliation to ensure that fair values are reasonably stated in conjunction with the Company’s capitalization. The Company uses all available information to estimate fair value of the reporting units, including discounted cash flows. A significant amount of judgment is involved in performing these evaluations given that the results are based on estimated future events. The result of the goodwill impairment assessment indicated that the fair value of the Drilling Products and Services segment exceeded its net book value and, therefore, no goodwill impairment was recorded. The Company will continue to evaluate the Drilling Products and Services segment for potential goodwill impairment in the fourth quarter of 2020 as market conditions continue to evolve. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 9 Months Ended |
Sep. 30, 2020 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-Based Compensation Plans | (12) Stock-Based Compensation Plans The Company maintained various stock incentive plans that provide long-term incentives to the Company’s key employees, including officers, directors, consultants and advisors (the Eligible Participants) prior to the Chapter 11 Cases. Under the stock incentive plans, the Company could grant incentive stock options, restricted stock, restricted stock units, stock appreciation rights, other stock-based awards or any combination thereof to Eligible Participants. The Company’s total compensation expense related to these plans was approximately $ 6.1 million and $ 13.9 million for the nine months ended September 30, 2020 and 2019, respectively, which is reflected in general and administrative expenses. On September 28, 2020, the Board of Directors of the Company approved the implementation of a Key Employee Retention Program (the KERP), which is designed to retain key employees of the Company in their current roles over the near term while providing them with financial stability. The KERP payments are in lieu of any outstanding unvested awards under the Company’s long-term equity-based incentive plans (other than any performance share units granted in 2018 and 2019) and any 2020 annual bonuses that would otherwise be payable to the KERP participants. The KERP provided for one-time retention payments equal to approximately $ 7.3 million in the aggregate to the six executive officers of the Company, including its named executive officers. The KERP further provided for approximately $ 2.4 million of retention payments to other non-executive employees, which will be made in installments. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | (13) Income Taxes Certain of the restructuring transactions contemplated by the RSA may have a material impact on the Company’s tax attributes, the full extent of which is currently unknown. Cancellation of indebtedness income resulting from such restructuring transactions may significantly reduce the Company’s tax attributes, including but not limited to NOL carryforwards. Further, the Company will experience an ownership change under Section 382 of the Internal Revenue Code of 1986, as amended (the Code), upon confirmation of the Plan by the Bankruptcy Court which will subject certain remaining tax attributes to an annual limitation under Section 382 of the Code. Additionally, if the Company proceeds with the Bankruptcy Filing, the Company will incur additional significant one-time costs associated with the Chapter 11 Cases. On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act), a tax relief and spending package intended to provide economic stimulus to address the impact of the COVID-19 pandemic. The CARES Act allows corporations with net operating losses generated in 2018, 2019 and 2020 to elect to carryback those losses for a period of five years and relaxes the limitation for business interest deductions for 2019 and 2020. Under the provisions of the CARES Act, the Company received a refund of $ 30.5 million in July 2020. The Company had $ 13.2 million of unrecorded tax benefits as of each of September 30, 2020 and December 31, 2019, all of which would impact the Company’s effective tax rate if recognized. It is the Company’s policy to recognize interest and applicable penalties, if any, related to uncertain tax positions in income tax expense. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | (14) Earnings per Share Basic earnings per share is computed by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed in the same manner as basic earnings per share except that the denominator is increased to include the number of additional shares of common stock that could have been outstanding assuming the exercise of stock options and the conversion of restricted stock units. The Company incurred a loss from continuing operations for each of the three and nine months ended September 30, 2020 and 2019; therefore, the impact of any incremental shares would be anti-dilutive. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Contingencies [Abstract] | |
Contingencies | (15) Contingencies Due to the nature of the Company’s business, the Company is involved, from time to time, in routine litigation or subject to disputes or claims regarding its business activities. Legal costs related to these matters are expensed as incurred. A subsidiary of the Company is involved in legal proceedings with two employees regarding the payment of royalties for a patentable product developed by them. On April 2, 2018, the employees filed a lawsuit in the Harris County District Court alleging that the royalty payments they had received since 2010 should have been higher. In May 2019, the jury issued a verdict in favor of the plaintiffs. On October 25, 2019, the court issued a final judgment against the Company. The Company strongly disagrees with the verdict and believes the district court committed several legal errors that should result in a reversal or remand of the case by the Court of Appeals. The ultimate resolution of this matter could result in a loss of up to $ 7.5 million in excess of amounts accrued. Commencement of the Chapter 11 Cases will automatically stay certain proceedings and actions against the Debtors, in addition to actions seeking to collect pre-petition indebtedness or to exercise control over the property of the Debtor’s bankruptcy estates. |
Supplemental Guarantor Informat
Supplemental Guarantor Information | 9 Months Ended |
Sep. 30, 2020 | |
Supplemental Guarantor Information [Abstract] | |
Supplemental Guarantor Information | (16) Supplemental Guarantor Information SESI, L.L.C. (the Issuer), a 100 % owned subsidiary of Superior Energy Services, Inc. (the Parent), has $ 500 million of 7.75 % senior unsecured notes due 2024 (the SESI 2024 notes). The Parent, along with certain of its direct and indirect 100 % owned domestic subsidiaries (the subsidiary guarantors, and together with the Parent, the guarantors), have entered into guarantees of the outstanding SESI 2024 notes (the guarantees). All guarantees provided by the guarantors are full and unconditional, joint and several, except that the guarantee of any subsidiary guarantor may be released under certain customary circumstances, including (i) in connection with a sale or other disposition of all or substantially all of the assets of the applicable subsidiary guarantor (including by way of merger or consolidation) to a person that is not the Issuer, Parent or a subsidiary of the Issuer; (ii) in connection with a sale or other disposition of all of the capital stock of such subsidiary guarantor to a person that is not the Parent or Issuer or their respective subsidiaries; and (iii) upon legal defeasance or satisfaction and discharge of the indenture governing the SESI 2024 notes. The Parent will be released from its guarantee only in connection with any legal defeasance or satisfaction and discharge of the indenture. With respect to each guarantor, each guarantee is a general unsecured senior obligation of such guarantor and ranks equally in right of payment with all existing and future senior unsecured indebtedness of such guarantor; is senior in right of payment to any future subordinated obligations of such guarantor; and is effectively subordinated to existing and future secured indebtedness of such guarantor to the extent of the value of the assets securing that indebtedness. The guarantee obligations of the Parent and each subsidiary guarantor is limited as necessary to prevent the guarantee from constituting a fraudulent conveyance under applicable law. If a guarantee were rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees and other contingent liabilities) of the applicable guarantor, and, depending on the amount of such indebtedness, such guarantor’s liability on its guarantee could be reduced to zero. The SESI 2024 notes and the guarantees are structurally subordinated to all indebtedness and other obligations of any of the subsidiary guarantors that do not guarantee the SESI 2024 notes (the non-guarantor subsidiaries). Such non-guarantor subsidiaries have no obligation, contingent or otherwise, to pay amounts due under the SESI 2024 notes or to make funds available to pay those amounts, whether by dividends, distributions, loans or other payments. However, the Parent, Issuer and Subsidiary Guarantors are all expected to be Debtors pursuant to the Chapter 11 Cases. See Note 1 of the notes to our condensed consolidated financial statements included in Part I, Item 1, “Financial Statements – Note 1 – Basis of Presentation” of this Quarterly Report for a complete discussion of the Chapter 11 Cases. The following summarized financial information presents the financial information of the Parent, Issuer and the subsidiary guarantors (collectively, the Obligor Group), on a combined basis, after elimination of (i) intercompany transactions and balances among the Parent, Issuer and the subsidiary guarantors and (ii) equity in earnings from and investments in any subsidiary of the Parent that is not the Issuer or a subsidiary guarantor. OBLIGOR GROUP Summarized Balance Sheets Information (in thousands) September 30, 2020 December 31, 2019 Current assets $ 422,138 $ 789,562 Noncurrent assets 1,086,516 1,134,238 Total assets $ 1,508,654 $ 1,923,800 Current liabilities $ 176,423 $ 261,743 Noncurrent liabilities 2,027,477 2,039,138 Total liabilities $ 2,203,900 $ 2,300,881 OBLIGOR GROUP Summarized Statements of Operations Information (in thousands) Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Total revenues $ 507,636 $ 1,126,456 Cost of revenues 343,561 723,451 Loss from operations before income taxes ( 179,335 ) ( 92,731 ) Income taxes ( 13,404 ) 6,102 Net loss from continuing operations ( 165,931 ) ( 98,833 ) Loss from discontinued operations, net of tax ( 111,375 ) ( 177,968 ) Net loss attributable to the obligor group $ ( 277,306 ) $ ( 276,801 ) The same accounting policies as described in “Note 1 – Basis of Presentation” to the consolidated financial statements included in this report are used by the Parent and each of its subsidiaries in connection with the summarized financial information presented above. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations [Abstract] | |
Discontinued Operations | (17) Discontinued Operations On December 10, 2019, the Company’s indirect, wholly owned subsidiary, Pumpco Energy Services, Inc. (Pumpco), completed its existing hydraulic fracturing field operations and determined to discontinue, wind down and exit its hydraulic fracturing operations. The Company intends to maintain an adequate number of employees to efficiently wind down Pumpco’s business. The financial results of Pumpco’s operations have historically been included in the Company’s Onshore Completions and Workover Services segment. The Company intends to sell Pumpco’s fixed assets over time during the next twelve months. The following table summarizes the components of loss from discontinued operations, net of tax, for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Revenues $ 43 $ 69,132 $ 511 $ 239,911 Cost of services 56 62,279 6,588 219,285 Loss from discontinued operations before tax ( 60,864 ) ( 17,276 ) ( 123,659 ) ( 81,050 ) Loss from discontinued operations, net of income tax ( 58,003 ) ( 17,934 ) ( 111,375 ) ( 85,604 ) For the nine months ended September 30, 2020, loss from discontinued operations included $ 109.6 million in the reduction in value of assets relating to the impairment of property, plant and equipment. The following summarizes the assets and liabilities related to the Pumpco business reported as discontinued operations (in thousands): September 30, 2020 December 31, 2019 Current assets: Accounts receivable, net $ - $ 25,106 Other current assets 2,280 6,215 Total current assets $ 2,280 $ 31,321 Property, plant and equipment, net 49,259 179,144 Operating lease ROU assets 209 5,732 Total assets $ 51,748 $ 216,197 Current liabilities: Accounts payable $ 136 $ 14,370 Accrued expenses 2,869 24,751 Total current liabilities 3,005 39,121 Operating lease liabilities 2,755 5,415 Other long-term liabilities - 402 Total liabilities $ 5,760 $ 44,938 Significant operating non-cash items relating to Pumpco and cash flows from investing activities were as follows (in thousands): Nine Months Ended September 30, 2020 2019 Cash flows from discontinued operating activities: Depreciation and amortization $ - $ 72,271 Reduction in value of assets 109,591 23,824 Cash flows from discontinued investing activities: Payments for capital expenditures $ - $ ( 36,743 ) Proceeds from sales of assets 14,369 1,669 |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2020 | |
New Accounting Pronouncements | |
New Accounting Pronouncements | (18) New Accounting Pronouncements Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (the FASB) issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. This update improves financial reporting by requiring earlier recognition of credit losses on financing receivables and other financial assets in scope by using the Current Expected Credit Losses model (the CECL). The CECL model utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses on financial instruments at the time the asset is originated or acquired. This update will apply to receivables arising from revenue transactions. The new standard is effective for the Company beginning on January 1, 2023. The Company is evaluating the effect ASU 2016-13 will have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract. This update aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The capitalized implementation costs of a hosting arrangement that is a service contract will be expensed over the term of the hosting arrangement. The Company adopted the new standard on January 1, 2020 on a prospective basis with respect to all implementation costs incurred after the date of adoption. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. The new standard is effective for the Company beginning on January 1, 2021. The Company is evaluating the effect ASU 2019-12 will have on its consolidated financial statements. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue [Abstract] | |
Disaggregation Of Revenues | The following table presents the Company’s revenues by segment disaggregated by geography (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 U.S. land Drilling Products and Services $ 10,458 $ 46,590 $ 66,652 $ 142,073 Onshore Completion and Workover Services 21,559 75,973 103,957 273,727 Production Services 9,777 32,620 51,541 112,095 Technical Solutions 4,694 7,283 13,997 32,589 Total U.S. land $ 46,488 $ 162,466 $ 236,147 $ 560,484 U.S. offshore Drilling Products and Services $ 26,242 $ 33,895 $ 92,053 $ 91,048 Onshore Completion and Workover Services - - - - Production Services 6,630 18,295 24,292 58,977 Technical Solutions 15,740 40,771 70,884 95,195 Total U.S. offshore $ 48,612 $ 92,961 $ 187,229 $ 245,220 International Drilling Products and Services $ 19,301 $ 30,700 $ 68,639 $ 79,825 Onshore Completion and Workover Services - - - - Production Services 39,948 47,872 136,519 134,167 Technical Solutions 12,579 22,586 43,744 69,601 Total International $ 71,828 $ 101,158 $ 248,902 $ 283,593 Total Revenues $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 The following table presents the Company’s revenues by segment disaggregated by type (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Services Drilling Products and Services $ 11,130 $ 18,835 $ 38,719 $ 52,997 Onshore Completion and Workover Services 20,461 67,022 94,277 245,055 Production Services 44,550 85,188 167,081 262,658 Technical Solutions 20,860 40,495 67,769 128,538 Total Services $ 97,001 $ 211,540 $ 367,846 $ 689,248 Rentals Drilling Products and Services $ 38,786 $ 78,714 $ 161,188 $ 221,306 Onshore Completion and Workover Services 1,098 8,951 9,680 28,672 Production Services 2,246 9,216 16,106 25,068 Technical Solutions 432 2,890 9,032 7,773 Total Rentals $ 42,562 $ 99,771 $ 196,006 $ 282,819 Product Sales Drilling Products and Services $ 6,085 $ 13,636 $ 27,437 $ 38,643 Onshore Completion and Workover Services - - - - Production Services 9,559 4,383 29,165 17,513 Technical Solutions 11,721 27,255 51,824 61,074 Total Product Sales $ 27,365 $ 45,274 $ 108,426 $ 117,230 Total Revenues $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory [Abstract] | |
Components Of Inventory | September 30, 2020 December 31, 2019 Finished goods $ 42,180 $ 45,127 Raw materials 15,633 16,130 Work-in-process 6,329 9,360 Supplies and consumables 33,723 33,322 Total $ 97,865 $ 103,939 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt [Abstract] | |
Schedule Of Long Term Debt | September 30, 2020 December 31, 2019 Stated Interest Rate (%) Long-term Senior unsecured notes due September 2024 7.750 $ 500,000 $ 500,000 Senior unsecured notes due December 2021 7.125 800,000 800,000 Total debt, gross 1,300,000 1,300,000 Unamortized debt issuance costs ( 10,712 ) ( 13,371 ) Total debt, net $ 1,289,288 $ 1,286,629 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Operating Lease Expense | Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Long-term fixed lease expense $ 4,032 $ 8,942 $ 18,043 $ 25,507 Long-term variable lease expense 85 117 285 298 Short-term lease expense 1,652 3,346 8,175 13,216 Total operating lease expense $ 5,769 $ 12,405 $ 26,503 $ 39,021 |
Supplemental Balance Sheet Information | September 30, 2020 December 31, 2019 Operating lease ROU assets $ 56,198 $ 80,906 Accrued expenses $ 19,622 $ 21,072 Operating lease liabilities 38,649 62,354 Total operating lease liabilities $ 58,271 $ 83,426 Weighted average remaining lease term 8 years 9 years Weighted average discount rate 6.51 % 6.75 % Nine Months Ended September 30, 2020 2019 Cash paid for operating leases $ 20,806 $ 26,242 ROU assets obtained in exchange for lease obligations $ 3,513 $ 21,045 |
Maturities Of Operating Lease Liabilities | Remainder of 2020 $ 7,265 2021 21,905 2022 14,546 2023 10,977 2024 8,210 Thereafter 28,780 Total lease payments 91,683 Less imputed interest ( 33,412 ) Total $ 58,271 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Measurements [Abstract] | |
Summary of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | Fair Value at September 30, 2020 Level 1 Level 2 Level 3 Total Intangible and other long-term assets, net: Non-qualified deferred compensation assets $ - $ 14,252 $ - $ 14,252 Accounts payable: Non-qualified deferred compensation liabilities $ - $ 2,741 $ - $ 2,741 Other long-term liabilities: Non-qualified deferred compensation liabilities $ - $ 19,530 $ - $ 19,530 Total debt $ 350,100 $ - $ - $ 350,100 Fair Value at December 31, 2019 Level 1 Level 2 Level 3 Total Intangible and other long-term assets, net: Non-qualified deferred compensation assets $ - $ 15,499 $ - $ 15,499 Accounts payable: Non-qualified deferred compensation liabilities $ - $ 1,372 $ - $ 1,372 Other long-term liabilities: Non-qualified deferred compensation liabilities $ - $ 23,466 $ - $ 23,466 Total debt $ 1,021,300 $ - $ - $ 1,021,300 |
Fair Value Measurements Used In Testing | Nine Months Ended September 30, Impairment Fair Value Property, plant and equipment, net $ 19,451 $ 13,593 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Information [Abstract] | |
Schedule Of Segment Reporting Information | Three Months Ended September 30, 2020 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 56,001 $ 21,559 $ 56,355 $ 33,013 $ - $ 166,928 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion 23,714 21,943 46,115 24,461 - 116,233 Depreciation, depletion, amortization and accretion 14,424 5,356 9,584 4,983 825 35,172 General and administrative expenses 12,948 3,319 6,801 9,844 22,054 54,966 Restructuring expense - - - - 25,746 25,746 Reduction in value of assets - - - 2,929 - 2,929 Income (loss) from operations 4,915 ( 9,059 ) ( 6,145 ) ( 9,204 ) ( 48,625 ) ( 68,118 ) Interest income (expense), net - - - 1,122 ( 25,916 ) ( 24,794 ) Other income - - - - ( 1,399 ) ( 1,399 ) Income (loss) from continuing operations before income taxes $ 4,915 $ ( 9,059 ) $ ( 6,145 ) $ ( 8,082 ) $ ( 75,940 ) $ ( 94,311 ) Three Months Ended September 30, 2019 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 111,185 $ 75,973 $ 98,787 $ 70,640 $ - $ 356,585 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion 38,663 61,338 82,556 49,370 - 231,927 Depreciation, depletion, amortization and accretion 20,168 6,853 12,063 4,909 1,169 45,162 General and administrative expenses 14,363 8,144 2,905 14,935 20,519 60,866 Reduction in value of assets - 566 1,997 7,008 - 9,571 Income (loss) from operations 37,991 ( 928 ) ( 734 ) ( 5,582 ) ( 21,688 ) 9,059 Interest income (expense), net - - - 1,051 ( 25,556 ) ( 24,505 ) Other income - - - - ( 3,353 ) ( 3,353 ) Income (loss) from continuing operations before income taxes $ 37,991 $ ( 928 ) $ ( 734 ) $ ( 4,531 ) $ ( 50,597 ) $ ( 18,799 ) Nine Months Ended September 30, 2020 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 227,344 $ 103,957 $ 212,352 $ 128,625 $ - $ 672,278 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) 81,163 98,774 177,624 99,161 - 456,722 Depreciation, depletion, amortization and accretion 48,042 17,183 30,604 14,663 2,821 113,313 General and administrative expenses 38,388 12,635 21,232 34,044 72,244 178,543 Restructuring expense - - - - 27,033 27,033 Reduction in value of assets - - 4,096 15,355 - 19,451 Income (loss) from operations 59,751 ( 24,635 ) ( 21,204 ) ( 34,598 ) ( 102,098 ) ( 122,784 ) Interest income (expense), net - - - 3,399 ( 78,076 ) ( 74,677 ) Other expense - - - - ( 4,810 ) ( 4,810 ) Income (loss) from continuing operations before income taxes $ 59,751 $ ( 24,635 ) $ ( 21,204 ) $ ( 31,199 ) $ ( 184,984 ) $ ( 202,271 ) Nine Months Ended September 30, 2019 Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total Revenues $ 312,946 $ 273,727 $ 305,239 $ 197,385 $ - $ 1,089,297 Cost of revenues (exclusive of depreciation, depletion, amortization and accretion) 118,732 217,115 240,855 124,810 - 701,512 Depreciation, depletion, amortization and accretion 64,684 27,940 39,375 17,198 3,579 152,776 General and administrative expenses 44,173 24,044 18,687 46,394 69,717 203,015 Reduction in value of assets - 8,123 1,997 7,008 - 17,128 Income (loss) from operations 85,357 ( 3,495 ) 4,325 1,975 ( 73,296 ) 14,866 Interest income (expense), net - - - 3,104 ( 77,379 ) ( 74,275 ) Other expense - - - - ( 4,476 ) ( 4,476 ) Income (loss) from continuing operations before income taxes $ 85,357 $ ( 3,495 ) $ 4,325 $ 5,079 $ ( 155,151 ) $ ( 63,885 ) |
Schedule Of Identifiable Assets | Identifiable Assets Onshore Drilling Completion Products and and Workover Production Technical Corporate and Consolidated Services Services Services Solutions Other Total September 30, 2020 $ 591,152 $ 200,101 $ 367,944 $ 272,893 $ 142,156 $ 1,574,246 December 31, 2019 $ 659,621 467,697 $ 421,848 $ 377,627 $ 66,437 $ 1,993,230 |
Revenue By Geographic Area | Revenues Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 United States $ 95,100 $ 255,427 $ 423,376 $ 805,704 Other countries 71,828 101,158 248,902 283,593 Total $ 166,928 $ 356,585 $ 672,278 $ 1,089,297 Long-Lived Assets September 30, 2020 December 31, 2019 United States $ 411,974 $ 489,189 Other countries 162,614 175,760 Total $ 574,588 $ 664,949 |
Supplemental Guarantor Inform_2
Supplemental Guarantor Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Supplemental Guarantor Information [Abstract] | |
Summarized Balance Sheets Information | OBLIGOR GROUP Summarized Balance Sheets Information (in thousands) September 30, 2020 December 31, 2019 Current assets $ 422,138 $ 789,562 Noncurrent assets 1,086,516 1,134,238 Total assets $ 1,508,654 $ 1,923,800 Current liabilities $ 176,423 $ 261,743 Noncurrent liabilities 2,027,477 2,039,138 Total liabilities $ 2,203,900 $ 2,300,881 |
Summarized Statements of Operations Information | OBLIGOR GROUP Summarized Statements of Operations Information (in thousands) Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Total revenues $ 507,636 $ 1,126,456 Cost of revenues 343,561 723,451 Loss from operations before income taxes ( 179,335 ) ( 92,731 ) Income taxes ( 13,404 ) 6,102 Net loss from continuing operations ( 165,931 ) ( 98,833 ) Loss from discontinued operations, net of tax ( 111,375 ) ( 177,968 ) Net loss attributable to the obligor group $ ( 277,306 ) $ ( 276,801 ) |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations [Abstract] | |
Components Of Income (Loss) From Discontinued Operations | Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Revenues $ 43 $ 69,132 $ 511 $ 239,911 Cost of services 56 62,279 6,588 219,285 Loss from discontinued operations before tax ( 60,864 ) ( 17,276 ) ( 123,659 ) ( 81,050 ) Loss from discontinued operations, net of income tax ( 58,003 ) ( 17,934 ) ( 111,375 ) ( 85,604 ) |
Assets And Liabilities Of Discontinued Operation | September 30, 2020 December 31, 2019 Current assets: Accounts receivable, net $ - $ 25,106 Other current assets 2,280 6,215 Total current assets $ 2,280 $ 31,321 Property, plant and equipment, net 49,259 179,144 Operating lease ROU assets 209 5,732 Total assets $ 51,748 $ 216,197 Current liabilities: Accounts payable $ 136 $ 14,370 Accrued expenses 2,869 24,751 Total current liabilities 3,005 39,121 Operating lease liabilities 2,755 5,415 Other long-term liabilities - 402 Total liabilities $ 5,760 $ 44,938 |
Schedule Of Cash Flows From Discontinued Operations | Nine Months Ended September 30, 2020 2019 Cash flows from discontinued operating activities: Depreciation and amortization $ - $ 72,271 Reduction in value of assets 109,591 23,824 Cash flows from discontinued investing activities: Payments for capital expenditures $ - $ ( 36,743 ) Proceeds from sales of assets 14,369 1,669 |
Basis Of Presentation (Details)
Basis Of Presentation (Details) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020USD ($)item | Jun. 30, 2020 | Mar. 31, 2020USD ($)item | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | |
Basis Of Presentation [Line Items] | ||||||
Shares reserved for issuance | 10.00% | |||||
Restructuring expense | $ 25,746,000 | $ 27,033,000 | ||||
Cash Collateralized | 105.00% | |||||
Aggregate Principal Amount | 66.60% | |||||
New Common Stock | 2.00% | |||||
Pro Rata Share | 98.00% | |||||
Debt repayment | $ 1,300,000,000 | |||||
Decrease in revenue | 53.00% | |||||
Revenues | $ 166,928,000 | $ 356,600,000 | $ 356,585,000 | 672,278,000 | $ 1,089,297,000 | |
United States [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Decrease in rigs | 30.00% | 60.00% | ||||
Revenues | $ 95,100,000 | $ 255,427,000 | $ 423,376,000 | $ 805,704,000 | ||
International [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Decrease in rigs | 10.00% | |||||
Number of rigs | item | 731 | 834 | ||||
Existing Prepetiion Equity [Member] | Reorganized Company [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Equity interest acquired | 2.00% | 2.00% | ||||
Prepetition Noteholders [Member] | Reorganized Company [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Equity interest acquired | 98.00% | 98.00% | ||||
Original Senior Unsecured Notes Due 2021 [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Stated interest rate | 7.125% | 7.125% | ||||
New Senior Unsecured Notes Due 2021 [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt issuance | $ 800,000,000 | $ 800,000,000 | ||||
Stated interest rate | 7.125% | 7.125% | ||||
Senior Unsecured Notes Due 2024 [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt issuance | $ 500,000,000 | $ 500,000,000 | ||||
Stated interest rate | 7.75% | 7.75% | ||||
Delayed-Draw Term Loan Commitment Letter [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt issuance | $ 200,000,000 | $ 200,000,000 | ||||
Backstop Commitment Parties [Member] | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt repayment | $ 11,700,000 |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Payment term | 30 days |
Maximum [Member] | |
Performance obligation satisfaction period | 30 days |
Revenue (Disaggregation Of Reve
Revenue (Disaggregation Of Revenues, By Geography) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | |||||
Total revenues | $ 166,928 | $ 356,600 | $ 356,585 | $ 672,278 | $ 1,089,297 |
Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 56,001 | 111,185 | 227,344 | 312,946 | |
Onshore Completion and Workover Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 21,559 | 75,973 | 103,957 | 273,727 | |
Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 56,355 | 98,787 | 212,352 | 305,239 | |
Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 33,013 | 70,640 | 128,625 | 197,385 | |
U.S. Land [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 46,488 | 162,466 | 236,147 | 560,484 | |
U.S. Land [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 10,458 | 46,590 | 66,652 | 142,073 | |
U.S. Land [Member] | Onshore Completion and Workover Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 21,559 | 75,973 | 103,957 | 273,727 | |
U.S. Land [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 9,777 | 32,620 | 51,541 | 112,095 | |
U.S. Land [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 4,694 | 7,283 | 13,997 | 32,589 | |
U.S. Offshore [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 48,612 | 92,961 | 187,229 | 245,220 | |
U.S. Offshore [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 26,242 | 33,895 | 92,053 | 91,048 | |
U.S. Offshore [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 6,630 | 18,295 | 24,292 | 58,977 | |
U.S. Offshore [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 15,740 | 40,771 | 70,884 | 95,195 | |
International [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 71,828 | 101,158 | 248,902 | 283,593 | |
International [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 19,301 | 30,700 | 68,639 | 79,825 | |
International [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 39,948 | 47,872 | 136,519 | 134,167 | |
International [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | $ 12,579 | $ 22,586 | $ 43,744 | $ 69,601 |
Revenue (Disaggregation Of Re_2
Revenue (Disaggregation Of Revenues, By Type) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | |||||
Total revenues | $ 166,928 | $ 356,600 | $ 356,585 | $ 672,278 | $ 1,089,297 |
Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 56,001 | 111,185 | 227,344 | 312,946 | |
Onshore Completion and Workover Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 21,559 | 75,973 | 103,957 | 273,727 | |
Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 56,355 | 98,787 | 212,352 | 305,239 | |
Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 33,013 | 70,640 | 128,625 | 197,385 | |
Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 97,001 | 211,540 | 367,846 | 689,248 | |
Services [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 11,130 | 18,835 | 38,719 | 52,997 | |
Services [Member] | Onshore Completion and Workover Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 20,461 | 67,022 | 94,277 | 245,055 | |
Services [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 44,550 | 85,188 | 167,081 | 262,658 | |
Services [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 20,860 | 40,495 | 67,769 | 128,538 | |
Rentals [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 42,562 | 99,771 | 196,006 | 282,819 | |
Rentals [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 38,786 | 78,714 | 161,188 | 221,306 | |
Rentals [Member] | Onshore Completion and Workover Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 1,098 | 8,951 | 9,680 | 28,672 | |
Rentals [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 2,246 | 9,216 | 16,106 | 25,068 | |
Rentals [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 432 | 2,890 | 9,032 | 7,773 | |
Product Sales [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 27,365 | 45,274 | 108,426 | 117,230 | |
Product Sales [Member] | Drilling Products and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 6,085 | 13,636 | 27,437 | 38,643 | |
Product Sales [Member] | Production Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 9,559 | 4,383 | 29,165 | 17,513 | |
Product Sales [Member] | Technical Solutions [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | $ 11,721 | $ 27,255 | $ 51,824 | $ 61,074 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory [Abstract] | ||
Finished goods | $ 42,180 | $ 45,127 |
Raw materials | 15,633 | 16,130 |
Work-in-process | 6,329 | 9,360 |
Supplies and consumables | 33,723 | 33,322 |
Total | $ 97,865 | $ 103,939 |
Notes Receivable (Details)
Notes Receivable (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Notes Receivable [Abstract] | ||
Amount of notes receivable | $ 115 | |
Interest rate percentage to record present value of notes receivable | 6.58% | |
Company recorded interest income | $ 3.4 | $ 3.1 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Aug. 05, 2020 | |
Debt Instrument [Line Items] | ||
Current borrowing capacity | $ 97,300,000 | |
Letters of Credit Outstanding, Amount | 48,500,000 | |
Debt repayment | $ 1,300,000,000 | |
Original Senior Unsecured Notes Due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Stated interest rate on unsecured senior notes | 7.125% | |
New Senior Unsecured Notes Due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Debt issuance | $ 800,000,000 | |
Stated interest rate on unsecured senior notes | 7.125% | |
Senior Unsecured Notes Due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt issuance | $ 500,000,000 | |
Stated interest rate on unsecured senior notes | 7.75% | |
Amended Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 100,000,000 | |
Borrwoing capacity | 105.00% | |
Restricted Cash | $ 25,000,000 | |
Cash collateralized | $ 52,400,000 |
Debt (Schedule Of Long Term Deb
Debt (Schedule Of Long Term Debt) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Total debt, gross | $ 1,300,000 | $ 1,300,000 |
Unamortized debt issuance costs | (10,712) | (13,371) |
Total debt, net | 1,289,288 | 1,286,629 |
Senior Unsecured Notes Due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt, gross | $ 500,000 | 500,000 |
Stated interest rate | 7.75% | |
New Senior Unsecured Notes Due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Stated interest rate | 7.125% | |
Original Senior Unsecured Notes Due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt, gross | $ 800,000 | $ 800,000 |
Stated interest rate | 7.125% |
Decommissioning Liabilities (De
Decommissioning Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Summary of the activity for the Company's decommissioning liabilities | ||
Decommissioning liabilities | $ 141.1 | $ 136.3 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) $ in Millions | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
Decrease In Right Of Use Assets And Liabilities | $ 10.7 |
Leases (Operating Lease Expense
Leases (Operating Lease Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||||
Long-term fixed lease expense | $ 4,032 | $ 8,942 | $ 18,043 | $ 25,507 |
Long-term variable lease expense | 85 | 117 | 285 | 298 |
Short-term lease expense | 1,652 | 3,346 | 8,175 | 13,216 |
Total operating lease expense | $ 5,769 | $ 12,405 | $ 26,503 | $ 39,021 |
Leases (Supplemental Balance Sh
Leases (Supplemental Balance Sheet Information) (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Operating lease ROU assets | $ 56,198 | $ 80,906 | |
Accrued expenses | 19,622 | 21,072 | |
Operating lease liabilities | 38,649 | 62,354 | |
Total operating lease liabilities | $ 58,271 | $ 83,426 | |
Weighted average remaining lease term | 8 years | 9 years | |
Weighted average discount rate | 6.51% | 6.75% | |
Cash paid for operating leases | $ 20,806 | $ 26,242 | |
ROU assets obtained in exchange for lease obligations | $ 3,513 | $ 21,045 |
Leases (Maturities Of Operating
Leases (Maturities Of Operating Lease Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Remainder of 2020 | $ 7,265 | |
2021 | 21,905 | |
2022 | 14,546 | |
2023 | 10,977 | |
2024 | 8,210 | |
Thereafter | 28,780 | |
Total lease payments | 91,683 | |
Less imputed interest | (33,412) | |
Total | $ 58,271 | $ 83,426 |
Fair Value Measurements (Summar
Fair Value Measurements (Summary of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total debt | $ 350,100 | $ 1,021,300 |
Non-Qualified Deferred Compensation Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Intangible and other long-term assets, net | 14,252 | 15,499 |
Non Qualified Deferred Compensation Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accounts payable | 2,741 | 1,372 |
Other long-term liabilities | 19,530 | 23,466 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total debt | 350,100 | 1,021,300 |
Level 2 [Member] | Non-Qualified Deferred Compensation Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Intangible and other long-term assets, net | 14,252 | 15,499 |
Level 2 [Member] | Non Qualified Deferred Compensation Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accounts payable | 2,741 | 1,372 |
Other long-term liabilities | $ 19,530 | $ 23,466 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Measurements Used In Testing) (Details) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Fair Value Measurements Used In Testing [Line Items] | |
Reduction in Value of Goodwill | $ 0 |
Fair Value, Nonrecurring [Member] | |
Fair Value Measurements Used In Testing [Line Items] | |
Impairment, Property, plant and equipment, net | 19,451,000 |
Fair Value, Property, plant and equipment, net | $ 13,593,000 |
Segment Information (Schedule O
Segment Information (Schedule Of Segment Reporting Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | |||||
Revenues | $ 166,928 | $ 356,600 | $ 356,585 | $ 672,278 | $ 1,089,297 |
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion | 116,233 | 231,927 | 456,722 | 701,512 | |
Depreciation, depletion, amortization and accretion | 35,172 | 45,162 | 113,313 | 152,776 | |
General and administrative expenses | 54,966 | 60,866 | 178,543 | 203,015 | |
Restructuring expense | 25,746 | 27,033 | |||
Reduction in value of assets | 2,929 | 9,571 | 19,451 | 17,128 | |
Income (loss) from operations | (68,118) | 9,059 | (122,784) | 14,866 | |
Interest income (expense), net | (24,794) | (24,505) | (74,677) | (74,275) | |
Other income (expense): | (1,399) | (3,353) | (4,810) | (4,476) | |
Loss from continuing operations before income taxes | (94,311) | (18,799) | (202,271) | (63,885) | |
Drilling Products and Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 56,001 | 111,185 | 227,344 | 312,946 | |
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion | 23,714 | 38,663 | 81,163 | 118,732 | |
Depreciation, depletion, amortization and accretion | 14,424 | 20,168 | 48,042 | 64,684 | |
General and administrative expenses | 12,948 | 14,363 | 38,388 | 44,173 | |
Income (loss) from operations | 4,915 | 37,991 | 59,751 | 85,357 | |
Loss from continuing operations before income taxes | 4,915 | 37,991 | 59,751 | 85,357 | |
Onshore Completion and Workover Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 21,559 | 75,973 | 103,957 | 273,727 | |
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion | 21,943 | 61,338 | 98,774 | 217,115 | |
Depreciation, depletion, amortization and accretion | 5,356 | 6,853 | 17,183 | 27,940 | |
General and administrative expenses | 3,319 | 8,144 | 12,635 | 24,044 | |
Reduction in value of assets | 566 | 8,123 | |||
Income (loss) from operations | (9,059) | (928) | (24,635) | (3,495) | |
Loss from continuing operations before income taxes | (9,059) | (928) | (24,635) | (3,495) | |
Production Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 56,355 | 98,787 | 212,352 | 305,239 | |
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion | 46,115 | 82,556 | 177,624 | 240,855 | |
Depreciation, depletion, amortization and accretion | 9,584 | 12,063 | 30,604 | 39,375 | |
General and administrative expenses | 6,801 | 2,905 | 21,232 | 18,687 | |
Reduction in value of assets | 1,997 | 4,096 | 1,997 | ||
Income (loss) from operations | (6,145) | (734) | (21,204) | 4,325 | |
Loss from continuing operations before income taxes | (6,145) | (734) | (21,204) | 4,325 | |
Technical Solutions [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 33,013 | 70,640 | 128,625 | 197,385 | |
Cost of revenues (exclusive of depreciation, depletion, amortization and accretion | 24,461 | 49,370 | 99,161 | 124,810 | |
Depreciation, depletion, amortization and accretion | 4,983 | 4,909 | 14,663 | 17,198 | |
General and administrative expenses | 9,844 | 14,935 | 34,044 | 46,394 | |
Reduction in value of assets | 2,929 | 7,008 | 15,355 | 7,008 | |
Income (loss) from operations | (9,204) | (5,582) | (34,598) | 1,975 | |
Interest income (expense), net | 1,122 | 1,051 | 3,399 | 3,104 | |
Loss from continuing operations before income taxes | (8,082) | (4,531) | (31,199) | 5,079 | |
Corporate and Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Depreciation, depletion, amortization and accretion | 825 | 1,169 | 2,821 | 3,579 | |
General and administrative expenses | 22,054 | 20,519 | 72,244 | 69,717 | |
Restructuring expense | 25,746 | 27,033 | |||
Income (loss) from operations | (48,625) | (21,688) | (102,098) | (73,296) | |
Interest income (expense), net | (25,916) | (25,556) | (78,076) | (77,379) | |
Other income (expense): | (1,399) | (3,353) | (4,810) | (4,476) | |
Loss from continuing operations before income taxes | $ (75,940) | $ (50,597) | $ (184,984) | $ (155,151) |
Segment Information (Schedule_2
Segment Information (Schedule Of Identifiable Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Identifiable Assets | $ 1,574,246 | $ 1,993,230 |
Drilling Products and Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Identifiable Assets | 591,152 | 659,621 |
Onshore Completion and Workover Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Identifiable Assets | 200,101 | 467,697 |
Production Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Identifiable Assets | 367,944 | 421,848 |
Technical Solutions [Member] | ||
Segment Reporting Information [Line Items] | ||
Identifiable Assets | 272,893 | 377,627 |
Corporate and Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Identifiable Assets | $ 142,156 | $ 66,437 |
Segment Information (Revenue By
Segment Information (Revenue By Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||
Revenues | $ 166,928 | $ 356,600 | $ 356,585 | $ 672,278 | $ 1,089,297 | |
Long-lived assets | 574,588 | 574,588 | $ 664,949 | |||
United States [Member] | ||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||
Revenues | 95,100 | 255,427 | 423,376 | 805,704 | ||
Long-lived assets | 411,974 | 411,974 | 489,189 | |||
International [Member] | ||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||
Revenues | 71,828 | $ 101,158 | 248,902 | $ 283,593 | ||
Long-lived assets | $ 162,614 | $ 162,614 | $ 175,760 |
Reduction in Value of Assets (D
Reduction in Value of Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Reduction In Value Of Assets And Impairments [Line Items] | ||||
Reduction in value of long-lived assets | $ 2,929 | $ 9,571 | $ 19,451 | $ 17,128 |
Production Services [Member] | ||||
Reduction In Value Of Assets And Impairments [Line Items] | ||||
Reduction in value of long-lived assets | 1,997 | 4,096 | 1,997 | |
Technical Solutions [Member] | ||||
Reduction In Value Of Assets And Impairments [Line Items] | ||||
Reduction in value of long-lived assets | $ 2,929 | $ 7,008 | $ 15,355 | $ 7,008 |
Goodwill (Details)
Goodwill (Details) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Goodwill [Abstract] | |
Goodwill impairment | $ 0 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Details) - USD ($) $ in Millions | Sep. 28, 2020 | Sep. 30, 2020 | Sep. 30, 2019 |
Non-Executive Employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 2.4 | ||
Executive Officers [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 7.3 | ||
Awards, Excluding ESPP [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 6.1 | $ 13.9 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Jul. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | |
Income Taxes [Abstract] | |||
CARES Act, Expected refund | $ 30.5 | ||
Unrecorded tax benefits | $ 13.2 | $ 13.2 |
Contingencies (Details)
Contingencies (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($)plaintiff | |
Number of people involved in lawsuit | plaintiff | 2 |
Maximum [Member] | |
Potential loss in lawsuit | $ | $ 7.5 |
Supplemental Guarantor Inform_3
Supplemental Guarantor Information (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Unsecured Senior Notes Due 2024 [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Unsecured senior notes | $ 500,000,000 |
Stated interest rate on unsecured senior notes | 7.75% |
SESI LLC [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Subsidiary ownership | 100.00% |
Supplemental Guarantor Inform_4
Supplemental Guarantor Information (Summarized Balance Sheets Information) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Condensed Financial Statements, Captions [Line Items] | ||
Current assets | $ 596,418 | $ 988,369 |
Total assets | 1,574,246 | 1,993,230 |
Current liabilities | 228,932 | 324,487 |
Obligor Group [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Current assets | 422,138 | 789,562 |
Noncurrent assets | 1,086,516 | 1,134,238 |
Total assets | 1,508,654 | 1,923,800 |
Current liabilities | 176,423 | 261,743 |
Noncurrent liabilities | 2,027,477 | 2,039,138 |
Total liabilities | $ 2,203,900 | $ 2,300,881 |
Supplemental Guarantor Inform_5
Supplemental Guarantor Information (Summarized Statements of Operations Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||||||||
Total revenues | $ 166,928 | $ 356,600 | $ 356,585 | $ 672,278 | $ 1,089,297 | ||||
Cost of revenues | 116,233 | 231,927 | 456,722 | 701,512 | |||||
Loss from operations before income taxes | (94,311) | (18,799) | (202,271) | (63,885) | |||||
Income taxes | 4,990 | 1,708 | (11,772) | 7,707 | |||||
Net loss from continuing operations | (99,301) | (20,507) | (190,499) | (71,592) | |||||
Loss from discontinued operations, net of tax | (58,003) | (17,934) | (111,375) | (85,604) | |||||
Net loss | $ (157,304) | $ (65,106) | $ (79,464) | $ (38,441) | $ (71,050) | $ (47,705) | (301,874) | $ (157,196) | |
Obligor Group [Member] | |||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||
Total revenues | 507,636 | $ 1,126,456 | |||||||
Cost of revenues | 343,561 | 723,451 | |||||||
Loss from operations before income taxes | (179,335) | (92,731) | |||||||
Income taxes | (13,404) | 6,102 | |||||||
Net loss from continuing operations | (165,931) | (98,833) | |||||||
Loss from discontinued operations, net of tax | (111,375) | (177,968) | |||||||
Net loss | $ (277,306) | $ (276,801) |
Discontinued Operations (Narrat
Discontinued Operations (Narrative) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Discontinued Operations [Abstract] | |
Reduction in value of assets held for sale | $ 109,591 |
Discontinued Operations (Compon
Discontinued Operations (Components Of Income (Loss) From Discontinued Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Discontinued Operations [Abstract] | ||||
Revenues | $ 43 | $ 69,132 | $ 511 | $ 239,911 |
Cost of services | 56 | 62,279 | 6,588 | 219,285 |
Loss from discontinued operations before tax | (60,864) | (17,276) | (123,659) | (81,050) |
Loss from discontinued operations, net of income tax | $ (58,003) | $ (17,934) | $ (111,375) | $ (85,604) |
Discontinued Operations (Assets
Discontinued Operations (Assets And Liabilities Of Discontinued Operation) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total current assets | $ 51,748 | $ 216,197 |
Total liabilities | 5,760 | 44,938 |
Pumpco [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Accounts receivable, net | 25,106 | |
Other current assets | 2,280 | 6,215 |
Total current assets | 2,280 | 31,321 |
Property, plant and equipment, net | 49,259 | 179,144 |
Operating lease ROU assets | 209 | 5,732 |
Total assets | 51,748 | 216,197 |
Accounts payable | 136 | 14,370 |
Accrued expenses | 2,869 | 24,751 |
Total current liabilities | 3,005 | 39,121 |
Operating lease liabilities | 2,755 | 5,415 |
Other long-term liabilities | 402 | |
Total liabilities | $ 5,760 | $ 44,938 |
Discontinued Operations (Schedu
Discontinued Operations (Schedule Of Cash Flows From Discontinued Operations) (Details) - Pumpco [Member] - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Depreciation and amortization | $ 72,271 | |
Reduction in value of assets | $ 109,591 | 23,824 |
Payments for capital expenditures | (36,743) | |
Proceeds from sales of assets | $ 14,369 | $ 1,669 |