Delaware
|
|
1-4221
|
|
73-0679879
|
(State or other jurisdiction of
Incorporation)
|
|
(Commission File
Number)
|
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
Trading symbol(s)
|
Name of each exchange on which registered
|
Common Stock ($0.10 par value)
|
HP
|
New York Stock Exchange
|
Exhibit Number
|
|
Description
|
|
99
|
|
|
|
HELMERICH & PAYNE, INC.
|
|
|
|
|
|
By:
|
/s/ Debra R. Stockton
|
|
Name:
|
Debra R. Stockton
|
|
Title:
|
Corporate Secretary
Date: July 24, 2019
|
|
Exhibit 99
|
•
|
Quarterly U.S. Land adjusted average rig revenue increased by more than $495
(1)
per day, up approximately 2% sequentially
|
•
|
Quarterly U.S. Land adjusted average rig margin decreased by approximately $170
(1)
per day, down roughly 2% sequentially
|
•
|
H&P upgraded 2 FlexRigs® to super-spec
(2)
capacity during the third fiscal quarter of 2019 and received multi-year term contracts with attractive pricing
|
•
|
The Company incurred a non-cash impairment charge of $224 million related to excess drilling equipment and spares, primarily driven by the reduction of 53 rigs within our FlexRig4 fleet during the quarter
|
•
|
The Company sent its first super-spec FlexRig to Argentina and has a letter of intent to deploy a second super-spec FlexRig into the country with a different customer
|
•
|
H&P's drilling automation technology, AutoSlide
SM
, has been commercially deployed in four U.S. shale basins, with the next deployment scheduled during the fourth fiscal quarter
|
•
|
On June 5, 2019, Directors of the Company declared a quarterly cash dividend of $0.71 per share
|
•
|
$0.15 of after-tax gains pertaining to early termination compensation, gains on sales, and discrete tax adjustments
|
•
|
$(1.97) of after-tax losses pertaining to impairments of drilling equipment and spares mainly driven by the downsizing of the Flex4 rig fleet, inventory write-downs, abandonments and accelerated depreciation, and a non-cash fair market adjustment to our equity investments
|
•
|
Quarterly revenue days expected to decrease by approximately 5%-6% sequentially representing a roughly 6%-7% decrease in the average number of active rigs; we expect to exit the quarter at between 193-203 active rigs
|
•
|
Average rig revenue per day expected to be down slightly to between $25,250-$25,750 (excluding any impact from early termination revenue) with the primary cause of the decline relating to FlexApps now being included in HPT revenues in the fourth fiscal quarter
|
•
|
Average rig expense per day expected to be between $14,350-$14,850
|
•
|
We expect to upgrade 1-2 FlexRigs to walking super-spec capabilities during the quarter
|
•
|
Quarterly revenue days expected to increase slightly, representing an average rig count of 17-18 rigs for the quarter
|
•
|
Average rig margin per day expected to be flat at $7,500-$8,500 due to rig start-up and mobilization costs
|
•
|
Quarterly revenue days expected to increase by approximately 1% sequentially, representing an average rig count of 6 rigs for the quarter
|
•
|
Average rig margin per day expected to be flat at $12,000-$13,000
|
•
|
Management contracts expected to generate approximately $2 million in operating income
|
•
|
Fiscal fourth quarter revenue, inclusive of FlexApps, is expected to be between $17-$19 million
|
•
|
Capital expenditures are now expected to be at the lower end of our previous range of approximately $500 to $530 million with roughly 35% expected for super-spec upgrades, 33-38% expected for maintenance and 27-32% expected for continued reactivations and other bulk purchases.
|
•
|
Depreciation is now expected to be approximately $565 million, inclusive of abandonment and accelerated depreciation charges estimated at approximately $15 million.
|
•
|
$0.01 of after-tax income from long-term contract early termination compensation from customers
|
•
|
$0.06 of income tax adjustments related to certain discrete tax items
|
•
|
$0.08 of after-tax gains related to the sale of used drilling equipment
|
•
|
$(0.02) of non-cash after-tax losses from abandonment charges and accelerated depreciation related to the decommissioning of used drilling equipment
|
•
|
$(0.06) of non-cash after-tax losses from inventory write-downs, some of which result from the downsizing of the Flex4 rig fleet
|
•
|
$(0.11) of non-cash after-tax losses related to the fair market adjustment of equity investments
|
•
|
$(1.78) of non-cash after-tax losses from impairments of drilling equipment and spares driven by the downsizing of the Flex4 rig fleet
|
•
|
$0.01 of after-tax income from long-term contract early termination compensation from customers
|
•
|
$0.04 of non-cash after-tax gains related to the fair market adjustment of equity investments
|
•
|
$0.08 of after-tax gains related to the sale of used drilling equipment
|
•
|
$(0.04) of non-cash after-tax losses from abandonment charges and accelerated depreciation related to the decommissioning of used drilling equipment
|
•
|
$(0.10) of non-cash after-tax losses from discontinued operations related to adjustments resulting from currency fluctuations
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
As adjusted
|
|
|
|
As adjusted
|
||||||||||
Operating revenues
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract drilling
|
$
|
684,788
|
|
|
$
|
717,653
|
|
|
$
|
637,548
|
|
|
$
|
2,139,798
|
|
|
$
|
1,763,939
|
|
Other
|
3,186
|
|
|
3,215
|
|
|
11,324
|
|
|
9,642
|
|
|
26,504
|
|
|||||
|
687,974
|
|
|
720,868
|
|
|
648,872
|
|
|
2,149,440
|
|
|
1,790,443
|
|
|||||
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract drilling operating expenses, excluding depreciation and amortization
|
443,114
|
|
|
441,719
|
|
|
443,087
|
|
|
1,372,426
|
|
|
1,199,422
|
|
|||||
Operating expenses applicable to other revenues
|
1,414
|
|
|
1,620
|
|
|
1,424
|
|
|
4,308
|
|
|
3,728
|
|
|||||
Depreciation and amortization
|
143,297
|
|
|
143,161
|
|
|
144,579
|
|
|
427,917
|
|
|
433,521
|
|
|||||
Asset impairment charge
|
224,327
|
|
|
—
|
|
|
—
|
|
|
224,327
|
|
|
—
|
|
|||||
Research and development
|
7,066
|
|
|
7,262
|
|
|
5,479
|
|
|
21,347
|
|
|
13,149
|
|
|||||
Selling, general and administrative
|
46,590
|
|
|
43,506
|
|
|
52,310
|
|
|
144,604
|
|
|
147,005
|
|
|||||
Gain on sale of assets
|
(9,960
|
)
|
|
(11,546
|
)
|
|
(4,313
|
)
|
|
(27,050
|
)
|
|
(15,133
|
)
|
|||||
|
855,848
|
|
|
625,722
|
|
|
642,566
|
|
|
2,167,879
|
|
|
1,781,692
|
|
|||||
Operating income (loss) from continuing operations
|
(167,874
|
)
|
|
95,146
|
|
|
6,306
|
|
|
(18,439
|
)
|
|
8,751
|
|
|||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest and dividend income
|
2,349
|
|
|
2,061
|
|
|
2,109
|
|
|
6,861
|
|
|
5,680
|
|
|||||
Interest expense
|
(6,257
|
)
|
|
(6,167
|
)
|
|
(5,993
|
)
|
|
(17,145
|
)
|
|
(17,794
|
)
|
|||||
Gain (loss) on investment securities
|
(13,271
|
)
|
|
5,878
|
|
|
—
|
|
|
(50,228
|
)
|
|
—
|
|
|||||
Other
|
(1,599
|
)
|
|
17
|
|
|
(61
|
)
|
|
(1,051
|
)
|
|
170
|
|
|||||
|
(18,778
|
)
|
|
1,789
|
|
|
(3,945
|
)
|
|
(61,563
|
)
|
|
(11,944
|
)
|
|||||
Income (loss) from continuing operations before income taxes
|
(186,652
|
)
|
|
96,935
|
|
|
2,361
|
|
|
(80,002
|
)
|
|
(3,193
|
)
|
|||||
Income tax provision (benefit)
|
(32,031
|
)
|
|
25,078
|
|
|
10,535
|
|
|
(5,602
|
)
|
|
(494,028
|
)
|
|||||
Income (loss) from continuing operations
|
(154,621
|
)
|
|
71,857
|
|
|
(8,174
|
)
|
|
(74,400
|
)
|
|
490,835
|
|
|||||
Income from discontinued operations before income taxes
|
7,244
|
|
|
2,889
|
|
|
8,383
|
|
|
22,798
|
|
|
9,127
|
|
|||||
Income tax provision
|
7,306
|
|
|
13,855
|
|
|
8,217
|
|
|
23,231
|
|
|
19,743
|
|
|||||
Income (loss) from discontinued operations
|
(62
|
)
|
|
(10,966
|
)
|
|
166
|
|
|
(433
|
)
|
|
(10,616
|
)
|
|||||
Net income (loss)
|
$
|
(154,683
|
)
|
|
$
|
60,891
|
|
|
$
|
(8,008
|
)
|
|
$
|
(74,833
|
)
|
|
$
|
480,219
|
|
Basic earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
$
|
(1.42
|
)
|
|
$
|
0.65
|
|
|
$
|
(0.08
|
)
|
|
$
|
(0.71
|
)
|
|
$
|
4.47
|
|
Loss from discontinued operations
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
Net income (loss)
|
$
|
(1.42
|
)
|
|
$
|
0.55
|
|
|
$
|
(0.08
|
)
|
|
$
|
(0.71
|
)
|
|
$
|
4.37
|
|
Diluted earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
$
|
(1.42
|
)
|
|
$
|
0.65
|
|
|
$
|
(0.08
|
)
|
|
$
|
(0.71
|
)
|
|
$
|
4.45
|
|
Loss from discontinued operations
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
Net income (loss)
|
$
|
(1.42
|
)
|
|
$
|
0.55
|
|
|
$
|
(0.08
|
)
|
|
$
|
(0.71
|
)
|
|
$
|
4.35
|
|
Weighted average shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
109,425
|
|
|
109,406
|
|
|
108,905
|
|
|
109,324
|
|
|
108,818
|
|
|||||
Diluted
|
109,425
|
|
|
109,503
|
|
|
108,905
|
|
|
109,324
|
|
|
109,338
|
|
|
June 30,
|
|
September 30,
|
||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
334,775
|
|
|
$
|
284,355
|
|
Short-term investments
|
45,748
|
|
|
41,461
|
|
||
Other current assets
|
735,715
|
|
|
789,734
|
|
||
Total current assets
|
1,116,238
|
|
|
1,115,550
|
|
||
Investments
|
48,291
|
|
|
98,696
|
|
||
Property, plant and equipment, net
|
4,583,673
|
|
|
4,857,382
|
|
||
Other noncurrent assets
|
149,177
|
|
|
143,239
|
|
||
Total Assets
|
$
|
5,897,379
|
|
|
$
|
6,214,867
|
|
|
|
|
|
||||
Liabilities and Shareholders' Equity
|
|
|
|
||||
Current liabilities
|
$
|
390,526
|
|
|
$
|
377,168
|
|
Long-term debt, net of debt issuance costs
|
491,651
|
|
|
493,968
|
|
||
Other noncurrent liabilities
|
905,517
|
|
|
946,742
|
|
||
Noncurrent liabilities - discontinued operations
|
14,631
|
|
|
14,254
|
|
||
Total shareholders’ equity
|
4,095,054
|
|
|
4,382,735
|
|
||
Total Liabilities and Shareholders' Equity
|
$
|
5,897,379
|
|
|
$
|
6,214,867
|
|
|
Nine Months Ended June 30,
|
||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
2019
|
|
2018
|
||||
|
|
|
As adjusted
|
||||
OPERATING ACTIVITIES:
|
|
|
|
||||
Net income (loss)
|
$
|
(74,833
|
)
|
|
$
|
480,219
|
|
Adjustment for loss from discontinued operations
|
433
|
|
|
10,616
|
|
||
Income (loss) from continuing operations
|
(74,400
|
)
|
|
490,835
|
|
||
Depreciation and amortization
|
427,917
|
|
|
433,521
|
|
||
Asset impairment charge
|
224,327
|
|
|
—
|
|
||
Amortization of debt discount and debt issuance costs
|
1,176
|
|
|
798
|
|
||
Provision for bad debt
|
544
|
|
|
598
|
|
||
Stock-based compensation
|
25,467
|
|
|
23,472
|
|
||
Loss on investment securities
|
50,228
|
|
|
—
|
|
||
Gain on sale of assets
|
(27,050
|
)
|
|
(15,133
|
)
|
||
Deferred income tax benefit
|
(25,503
|
)
|
|
(498,491
|
)
|
||
Other
|
5,356
|
|
|
3,735
|
|
||
Changes in assets and liabilities
|
51,365
|
|
|
(67,757
|
)
|
||
Net cash provided by operating activities from continuing operations
|
659,427
|
|
|
371,578
|
|
||
Net cash used in operating activities from discontinued operations
|
(56
|
)
|
|
(150
|
)
|
||
Net cash provided by operating activities
|
659,371
|
|
|
371,428
|
|
||
|
|
|
|
||||
INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures
|
(403,570
|
)
|
|
(322,658
|
)
|
||
Purchase of short-term investments
|
(71,852
|
)
|
|
(52,159
|
)
|
||
Payment for acquisition of business, net of cash acquired
|
(2,781
|
)
|
|
(47,886
|
)
|
||
Proceeds from sale of short-term investments
|
68,015
|
|
|
52,470
|
|
||
Proceeds from asset sales
|
36,227
|
|
|
28,049
|
|
||
Net cash used in investing activities
|
(373,961
|
)
|
|
(342,184
|
)
|
||
|
|
|
|
||||
FINANCING ACTIVITIES:
|
|
|
|
||||
Dividends paid
|
(235,058
|
)
|
|
(230,368
|
)
|
||
Debt issuance costs paid
|
(3,912
|
)
|
|
—
|
|
||
Proceeds from stock option exercises
|
2,901
|
|
|
5,160
|
|
||
Payments for employee taxes on net settlement of equity awards
|
(6,420
|
)
|
|
(5,978
|
)
|
||
Payment of contingent consideration from acquisition of business
|
—
|
|
|
(10,625
|
)
|
||
Net cash used in financing activities
|
(242,489
|
)
|
|
(241,811
|
)
|
||
|
|
|
|
||||
Net increase (decrease) in cash and cash equivalents and restricted cash
|
42,921
|
|
|
(212,567
|
)
|
||
Cash and cash equivalents and restricted cash, beginning of period
|
326,185
|
|
|
560,509
|
|
||
Cash and cash equivalents and restricted cash, end of period
|
$
|
369,106
|
|
|
$
|
347,942
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
U.S. Land Operations
|
$
|
72,386
|
|
|
$
|
76,172
|
|
|
$
|
64,587
|
|
|
$
|
218,648
|
|
|
$
|
169,652
|
|
International Land Operations
|
1,483
|
|
|
2,277
|
|
|
3,492
|
|
|
7,506
|
|
|
8,634
|
|
|||||
Offshore Operations
|
7,277
|
|
|
5,507
|
|
|
5,057
|
|
|
18,534
|
|
|
14,354
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
||||||||||||
(in thousands)
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
|
|
|
|
|
As adjusted
|
|
|
|
As adjusted
|
||||||||||
Operating income (loss)
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Land
|
$
|
(138,205
|
)
|
|
$
|
106,139
|
|
|
$
|
34,339
|
|
|
$
|
47,602
|
|
|
$
|
86,159
|
|
International Land
|
(5,023
|
)
|
|
7,968
|
|
|
4,332
|
|
|
9,575
|
|
|
7,171
|
|
|||||
Offshore
|
5,078
|
|
|
4,531
|
|
|
3,780
|
|
|
16,778
|
|
|
17,954
|
|
|||||
H&P Technologies
|
(8,810
|
)
|
|
(7,933
|
)
|
|
(9,052
|
)
|
|
(27,088
|
)
|
|
(26,400
|
)
|
|||||
Other
|
(731
|
)
|
|
1,165
|
|
|
1,826
|
|
|
1,988
|
|
|
4,842
|
|
|||||
Segment operating income (loss)
|
$
|
(147,691
|
)
|
|
$
|
111,870
|
|
|
$
|
35,225
|
|
|
$
|
48,855
|
|
|
$
|
89,726
|
|
Gain on sale of assets
|
9,960
|
|
|
11,546
|
|
|
4,313
|
|
|
27,050
|
|
|
15,133
|
|
|||||
Corporate selling, general and administrative costs and corporate depreciation
|
(30,143
|
)
|
|
(28,270
|
)
|
|
(33,232
|
)
|
|
(94,344
|
)
|
|
(96,108
|
)
|
|||||
Operating income (loss)
|
$
|
(167,874
|
)
|
|
$
|
95,146
|
|
|
$
|
6,306
|
|
|
$
|
(18,439
|
)
|
|
$
|
8,751
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest and dividend income
|
2,349
|
|
|
2,061
|
|
|
2,109
|
|
|
6,861
|
|
|
5,680
|
|
|||||
Interest expense
|
(6,257
|
)
|
|
(6,167
|
)
|
|
(5,993
|
)
|
|
(17,145
|
)
|
|
(17,794
|
)
|
|||||
Gain (loss) on investment securities
|
(13,271
|
)
|
|
5,878
|
|
|
—
|
|
|
(50,228
|
)
|
|
—
|
|
|||||
Other
|
(1,599
|
)
|
|
17
|
|
|
(61
|
)
|
|
(1,051
|
)
|
|
170
|
|
|||||
Total unallocated amounts
|
(18,778
|
)
|
|
1,789
|
|
|
(3,945
|
)
|
|
(61,563
|
)
|
|
(11,944
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations before income taxes
|
$
|
(186,652
|
)
|
|
$
|
96,935
|
|
|
$
|
2,361
|
|
|
$
|
(80,002
|
)
|
|
$
|
(3,193
|
)
|
|
Three Months Ended
|
||||||
(in dollars per revenue day)
|
June 30, 2019
|
|
March 31, 2019
|
||||
U.S. Land Operations
|
|
|
|
||||
Total impact on U.S. Land revenue per day:
|
$
|
33
|
|
|
$
|
57
|
|
Total impact on U.S. Land expense per day:
|
340
|
|
|
0
|
|||
International Land Operations
|
|
|
|
||||
Total impact on International Land revenue per day:
|
$
|
115
|
|
|
$
|
0
|
|
|
July 24,
|
|
June 30,
|
|
March 31,
|
|
Q3FY19
|
||||
|
2019
|
|
2019
|
|
2019
|
|
Average
|
||||
U.S. Land Operations
|
|
|
|
|
|
|
|
||||
Term Contract Rigs
|
138
|
|
|
143
|
|
|
146
|
|
|
142.4
|
|
Spot Contract Rigs
|
69
|
|
|
71
|
|
|
80
|
|
|
75.7
|
|
Total Contracted Rigs
|
207
|
|
|
214
|
|
|
226
|
|
|
218.1
|
|
Idle or Other Rigs
|
92
|
|
|
85
|
|
|
124
|
|
|
131.9
|
|
Total Marketable Fleet
|
299
|
|
|
299
|
|
|
350
|
|
|
350.0
|
|
|
Q4
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Q1
|
|
Q2
|
|||||||
Segment
|
FY19
|
|
FY20
|
|
FY20
|
|
FY20
|
|
FY20
|
|
FY21
|
|
FY21
|
|||||||
U.S. Land Operations
|
137.9
|
|
|
120.6
|
|
|
91.7
|
|
|
76.5
|
|
|
62.1
|
|
|
44.1
|
|
|
18.9
|
|
International Land Operations
|
11.7
|
|
|
11.0
|
|
|
7.2
|
|
|
2.1
|
|
|
1.0
|
|
|
1.0
|
|
|
1.0
|
|
Offshore Operations
|
0.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
149.6
|
|
|
131.6
|
|
|
98.9
|
|
|
78.6
|
|
|
63.1
|
|
|
45.1
|
|
|
19.9
|
|