Q2false202209/300000046765http://fasb.org/us-gaap/2021-01-31#AccountingStandardsUpdate201613Member6121200000467652021-10-012022-03-3100000467652022-04-20xbrli:shares00000467652022-03-31iso4217:USD00000467652021-09-30iso4217:USDxbrli:shares00000467652022-01-012022-03-3100000467652021-01-012021-03-3100000467652020-10-012021-03-310000046765us-gaap:CommonStockMember2021-09-300000046765us-gaap:AdditionalPaidInCapitalMember2021-09-300000046765us-gaap:RetainedEarningsMember2021-09-300000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-300000046765us-gaap:TreasuryStockCommonMember2021-09-300000046765us-gaap:RetainedEarningsMember2021-10-012021-12-3100000467652021-10-012021-12-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-10-012021-12-3100000467652020-10-012020-12-310000046765us-gaap:AdditionalPaidInCapitalMember2021-10-012021-12-310000046765us-gaap:TreasuryStockCommonMember2021-10-012021-12-310000046765us-gaap:CommonStockMember2021-12-310000046765us-gaap:AdditionalPaidInCapitalMember2021-12-310000046765us-gaap:RetainedEarningsMember2021-12-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000046765us-gaap:TreasuryStockCommonMember2021-12-3100000467652021-12-310000046765us-gaap:RetainedEarningsMember2022-01-012022-03-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000046765us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310000046765us-gaap:TreasuryStockCommonMember2022-01-012022-03-310000046765us-gaap:CommonStockMember2022-03-310000046765us-gaap:AdditionalPaidInCapitalMember2022-03-310000046765us-gaap:RetainedEarningsMember2022-03-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000046765us-gaap:TreasuryStockCommonMember2022-03-310000046765us-gaap:CommonStockMember2020-09-300000046765us-gaap:AdditionalPaidInCapitalMember2020-09-300000046765us-gaap:RetainedEarningsMember2020-09-300000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-09-300000046765us-gaap:TreasuryStockCommonMember2020-09-3000000467652020-09-300000046765us-gaap:RetainedEarningsMember2020-10-012020-12-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-10-012020-12-310000046765us-gaap:CommonStockMember2020-10-012020-12-310000046765us-gaap:AdditionalPaidInCapitalMember2020-10-012020-12-310000046765us-gaap:TreasuryStockCommonMember2020-10-012020-12-3100000467652019-10-012020-09-300000046765srt:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:RetainedEarningsMember2020-09-300000046765srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-09-300000046765us-gaap:CommonStockMember2020-12-310000046765us-gaap:AdditionalPaidInCapitalMember2020-12-310000046765us-gaap:RetainedEarningsMember2020-12-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000046765us-gaap:TreasuryStockCommonMember2020-12-3100000467652020-12-310000046765us-gaap:RetainedEarningsMember2021-01-012021-03-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000046765us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310000046765us-gaap:TreasuryStockCommonMember2021-01-012021-03-310000046765us-gaap:CommonStockMember2021-03-310000046765us-gaap:AdditionalPaidInCapitalMember2021-03-310000046765us-gaap:RetainedEarningsMember2021-03-310000046765us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000046765us-gaap:TreasuryStockCommonMember2021-03-3100000467652021-03-31hp:location0000046765hp:A2018CreditFacilityMember2018-11-130000046765hp:A2018CreditFacilityMemberus-gaap:LetterOfCreditMember2018-11-130000046765hp:A2018CreditFacilityMember2022-03-310000046765hp:A2018CreditFacilityDueNovember2025Member2022-03-080000046765hp:UnsecuredSeniorNotesIssued2025Member2021-09-27xbrli:pure0000046765hp:UnsecuredSeniorNotesIssued2031Member2021-09-290000046765hp:UnsecuredSeniorNotesIssued2025Member2021-10-012021-12-310000046765hp:DrillingTechnologyCompaniesAcquisitionsMember2022-03-310000046765hp:DrillingTechnologyCompaniesAcquisitionsMember2021-09-300000046765us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2022-03-310000046765us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2021-03-310000046765us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2021-09-300000046765us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2020-09-300000046765us-gaap:OtherNoncurrentAssetsMember2022-03-310000046765us-gaap:OtherNoncurrentAssetsMember2021-03-310000046765us-gaap:OtherNoncurrentAssetsMember2021-09-300000046765us-gaap:OtherNoncurrentAssetsMember2020-09-300000046765srt:ConsolidationEliminationsMember2022-01-012022-03-310000046765srt:ConsolidationEliminationsMember2021-01-012021-03-310000046765country:AR2022-03-310000046765srt:MinimumMember2021-10-012022-03-31hp:geographical_area0000046765us-gaap:SalesRevenueNetMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMember2022-01-012022-03-310000046765us-gaap:SalesRevenueNetMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMember2021-10-012022-03-310000046765us-gaap:SalesRevenueNetMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMember2021-01-012021-03-310000046765us-gaap:SalesRevenueNetMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMember2020-10-012021-03-310000046765us-gaap:SalesRevenueNetMembersrt:SouthAmericaMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMemberhp:InternationalSolutionsSegmentMember2022-01-012022-03-310000046765us-gaap:SalesRevenueNetMembersrt:SouthAmericaMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMemberhp:InternationalSolutionsSegmentMember2021-10-012022-03-310000046765us-gaap:SalesRevenueNetMembersrt:SouthAmericaMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMemberhp:InternationalSolutionsSegmentMember2021-01-012021-03-310000046765us-gaap:SalesRevenueNetMembersrt:SouthAmericaMemberus-gaap:GeographicDistributionForeignMemberus-gaap:GeographicConcentrationRiskMemberhp:InternationalSolutionsSegmentMember2020-10-012021-03-31iso4217:VEBiso4217:USD0000046765srt:MinimumMemberus-gaap:MachineryAndEquipmentMember2021-10-012022-03-310000046765srt:MaximumMemberus-gaap:MachineryAndEquipmentMember2021-10-012022-03-310000046765us-gaap:MachineryAndEquipmentMember2022-03-310000046765us-gaap:MachineryAndEquipmentMember2021-09-300000046765us-gaap:PublicUtilitiesInventoryTubularGoodsMember2021-10-012022-03-310000046765us-gaap:PublicUtilitiesInventoryTubularGoodsMember2022-03-310000046765us-gaap:PublicUtilitiesInventoryTubularGoodsMember2021-09-300000046765srt:MinimumMemberus-gaap:RealEstateInvestmentMember2021-10-012022-03-310000046765us-gaap:RealEstateInvestmentMembersrt:MaximumMember2021-10-012022-03-310000046765us-gaap:RealEstateInvestmentMember2022-03-310000046765us-gaap:RealEstateInvestmentMember2021-09-300000046765srt:MinimumMemberus-gaap:PropertyPlantAndEquipmentOtherTypesMember2021-10-012022-03-310000046765srt:MaximumMemberus-gaap:PropertyPlantAndEquipmentOtherTypesMember2021-10-012022-03-310000046765us-gaap:PropertyPlantAndEquipmentOtherTypesMember2022-03-310000046765us-gaap:PropertyPlantAndEquipmentOtherTypesMember2021-09-300000046765us-gaap:ConstructionInProgressMember2022-03-310000046765us-gaap:ConstructionInProgressMember2021-09-300000046765hp:NorthAmericaSolutionsMemberhp:DomesticNonSuperSpecAssetGroupMember2022-03-31hp:rig0000046765hp:NorthAmericaSolutionsMemberhp:DomesticNonSuperSpecAssetGroupMember2021-10-012022-03-310000046765hp:NorthAmericaSolutionsMemberhp:DomesticNonSuperSpecAssetGroupMember2020-10-012021-09-300000046765hp:FlexRig4AssetGroupMember2021-09-300000046765hp:FlexRig4AssetGroupMember2021-09-012021-09-300000046765country:AEhp:FlexRig4AssetGroupMember2021-09-300000046765country:UShp:FlexRig4AssetGroupMember2021-09-300000046765hp:FlexRig4AssetGroupMember2021-10-012022-03-310000046765country:AEhp:FlexRig4AssetGroupMember2022-03-310000046765country:AEhp:FlexRig4AssetGroupMember2021-10-012022-03-310000046765country:AEhp:FlexRig4AssetGroupMember2022-01-012022-03-310000046765country:UShp:FlexRig4AssetGroupMember2022-03-310000046765country:UShp:FlexRig4AssetGroupMember2021-10-012022-03-310000046765srt:ScenarioForecastMembercountry:UShp:FlexRig4AssetGroupMember2021-10-012022-09-300000046765country:UShp:FlexRig4AssetGroupMember2022-01-012022-03-310000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2020-10-012021-09-30hp:service0000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2021-09-300000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2021-10-012022-03-31hp:transaction0000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2022-03-310000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2021-10-012021-12-310000046765hp:NorthAmericaSolutionsMemberhp:PartialRigSubstructuresMember2022-03-310000046765hp:NorthAmericaSolutionsMemberhp:PartialRigSubstructuresMember2021-10-012022-03-310000046765hp:InternationalFlexRigMemberhp:InternationalSolutionsSegmentMember2022-03-310000046765hp:InternationalSolutionsSegmentMember2021-10-012022-03-310000046765hp:InternationalFlexRigMemberhp:InternationalSolutionsSegmentMember2022-01-012022-03-310000046765hp:ReplacementValueOfDamagedDrillPipeMember2022-01-012022-03-310000046765hp:ReplacementValueOfDamagedDrillPipeMember2021-10-012022-03-310000046765hp:ReplacementValueOfDamagedDrillPipeMember2020-10-012020-12-310000046765hp:ReplacementValueOfDamagedDrillPipeMember2020-10-012021-03-310000046765hp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2022-01-012022-03-310000046765hp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2021-10-012022-03-310000046765hp:NorthAmericaSolutionsMemberhp:AssetsRelatedToTruckingServicesAndCasinoRunningServicesMember2022-01-012022-03-310000046765hp:OffshorePlatformRigMember2021-01-012021-03-310000046765hp:OffshorePlatformRigMember2020-10-012021-03-310000046765hp:OffshoreGulfofMexicoMemberhp:OffshorePlatformRigMember2020-10-012020-12-310000046765hp:ExcessDrillingEquipmentAndSparesMember2021-01-012021-03-310000046765us-gaap:DevelopedTechnologyRightsMember2021-10-012022-03-310000046765us-gaap:DevelopedTechnologyRightsMember2022-03-310000046765us-gaap:DevelopedTechnologyRightsMember2021-09-300000046765us-gaap:IntellectualPropertyMember2021-10-012022-03-310000046765us-gaap:IntellectualPropertyMember2022-03-310000046765us-gaap:IntellectualPropertyMember2021-09-300000046765us-gaap:TradeNamesMember2021-10-012022-03-310000046765us-gaap:TradeNamesMember2022-03-310000046765us-gaap:TradeNamesMember2021-09-300000046765us-gaap:CustomerRelationshipsMember2021-10-012022-03-310000046765us-gaap:CustomerRelationshipsMember2022-03-310000046765us-gaap:CustomerRelationshipsMember2021-09-300000046765hp:UnsecuredSeniorNotesIssued2025Member2022-03-310000046765hp:UnsecuredSeniorNotesIssued2025Member2021-09-300000046765hp:UnsecuredSeniorNotesIssued2031Member2022-03-310000046765hp:UnsecuredSeniorNotesIssued2031Member2021-09-300000046765hp:UnsecuredSeniorNotesIssued2025Member2018-12-200000046765hp:A2018CreditFacilityDueNovember2025Member2021-04-160000046765hp:A2018CreditFacilityDueNovember2024Member2022-03-080000046765us-gaap:LetterOfCreditMember2022-03-31hp:letter_of_credit0000046765hp:UnsecuredStandaloneLineOfCreditFacilityMember2022-03-3100000467652022-02-282022-02-2800000467652022-03-022022-03-020000046765us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-03-310000046765us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-09-300000046765us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-12-310000046765us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-01-012022-03-310000046765us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-10-012022-03-310000046765hp:YPFSAMember2021-11-122021-11-120000046765hp:YPFSAMember2021-11-1200000467652022-04-012022-03-3100000467652022-10-012022-03-3100000467652023-10-012022-03-31hp:month0000046765hp:ContractDrillingCostsExcludingDepreciationAndAmortizationMember2022-01-012022-03-310000046765hp:ContractDrillingCostsExcludingDepreciationAndAmortizationMember2021-01-012021-03-310000046765hp:ContractDrillingCostsExcludingDepreciationAndAmortizationMember2021-10-012022-03-310000046765hp:ContractDrillingCostsExcludingDepreciationAndAmortizationMember2020-10-012021-03-310000046765us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-03-310000046765us-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-03-310000046765us-gaap:ResearchAndDevelopmentExpenseMember2021-10-012022-03-310000046765us-gaap:ResearchAndDevelopmentExpenseMember2020-10-012021-03-310000046765us-gaap:SellingGeneralAndAdministrativeExpensesMember2022-01-012022-03-310000046765us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-01-012021-03-310000046765us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-10-012022-03-310000046765us-gaap:SellingGeneralAndAdministrativeExpensesMember2020-10-012021-03-310000046765us-gaap:RestrictedStockMember2021-09-300000046765us-gaap:RestrictedStockMember2021-10-012022-03-310000046765us-gaap:RestrictedStockMember2022-03-310000046765hp:RestrictedPhantomStockUnitsMember2021-10-012022-03-310000046765us-gaap:PerformanceSharesMember2021-09-300000046765us-gaap:PerformanceSharesMember2021-10-012022-03-310000046765us-gaap:PerformanceSharesMember2022-03-31hp:component0000046765hp:FirstComponentOfPerformanceUnitMember2021-10-012022-03-310000046765hp:SecondComponentOfPerformanceUnitMember2021-10-012022-03-31hp:tranche0000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-03-310000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-03-310000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-03-310000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-03-310000046765us-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-03-310000046765us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310000046765us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-03-310000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-09-300000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2021-09-300000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-09-300000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2021-09-300000046765us-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-09-300000046765us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-09-300000046765us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2021-09-300000046765hp:ADNOCDrillingMember2021-09-012021-09-300000046765hp:ADNOCDrillingMember2021-09-300000046765us-gaap:FairValueInputsLevel3Member2021-12-310000046765us-gaap:FairValueInputsLevel3Member2020-12-310000046765us-gaap:FairValueInputsLevel3Member2021-09-300000046765us-gaap:FairValueInputsLevel3Member2020-09-300000046765us-gaap:FairValueInputsLevel3Member2022-01-012022-03-310000046765us-gaap:FairValueInputsLevel3Member2021-01-012021-03-310000046765us-gaap:FairValueInputsLevel3Member2021-10-012022-03-310000046765us-gaap:FairValueInputsLevel3Member2020-10-012021-03-310000046765us-gaap:FairValueInputsLevel3Member2022-03-310000046765us-gaap:FairValueInputsLevel3Member2021-03-310000046765hp:GeothermalInvestmentsMember2022-03-310000046765hp:GeothermalInvestmentsMember2021-09-300000046765us-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310000046765us-gaap:CarryingReportedAmountFairValueDisclosureMember2021-03-310000046765us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2022-03-310000046765us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2021-03-3100000467652022-02-012022-02-280000046765hp:NorthAmericaSolutionsMember2022-01-012022-03-310000046765hp:OffshoreGulfofMexicoMember2022-01-012022-03-310000046765hp:InternationalSolutionsSegmentMember2022-01-012022-03-310000046765us-gaap:AllOtherSegmentsMember2022-01-012022-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:IntersegmentEliminationMember2022-01-012022-03-310000046765hp:OffshoreGulfofMexicoMemberus-gaap:IntersegmentEliminationMember2022-01-012022-03-310000046765us-gaap:IntersegmentEliminationMemberhp:InternationalSolutionsSegmentMember2022-01-012022-03-310000046765us-gaap:IntersegmentEliminationMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000046765us-gaap:IntersegmentEliminationMember2022-01-012022-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2022-01-012022-03-310000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2022-01-012022-03-310000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000046765us-gaap:OperatingSegmentsMember2022-01-012022-03-310000046765hp:NorthAmericaSolutionsMember2021-01-012021-03-310000046765hp:OffshoreGulfofMexicoMember2021-01-012021-03-310000046765hp:InternationalSolutionsSegmentMember2021-01-012021-03-310000046765us-gaap:AllOtherSegmentsMember2021-01-012021-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:IntersegmentEliminationMember2021-01-012021-03-310000046765hp:OffshoreGulfofMexicoMemberus-gaap:IntersegmentEliminationMember2021-01-012021-03-310000046765us-gaap:IntersegmentEliminationMemberhp:InternationalSolutionsSegmentMember2021-01-012021-03-310000046765us-gaap:IntersegmentEliminationMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000046765us-gaap:IntersegmentEliminationMember2021-01-012021-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2021-01-012021-03-310000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2021-01-012021-03-310000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000046765us-gaap:OperatingSegmentsMember2021-01-012021-03-310000046765hp:NorthAmericaSolutionsMember2021-10-012022-03-310000046765hp:OffshoreGulfofMexicoMember2021-10-012022-03-310000046765us-gaap:AllOtherSegmentsMember2021-10-012022-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:IntersegmentEliminationMember2021-10-012022-03-310000046765hp:OffshoreGulfofMexicoMemberus-gaap:IntersegmentEliminationMember2021-10-012022-03-310000046765us-gaap:IntersegmentEliminationMemberhp:InternationalSolutionsSegmentMember2021-10-012022-03-310000046765us-gaap:IntersegmentEliminationMemberus-gaap:AllOtherSegmentsMember2021-10-012022-03-310000046765us-gaap:IntersegmentEliminationMember2021-10-012022-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2021-10-012022-03-310000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2021-10-012022-03-310000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2021-10-012022-03-310000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2021-10-012022-03-310000046765us-gaap:OperatingSegmentsMember2021-10-012022-03-310000046765hp:NorthAmericaSolutionsMember2020-10-012021-03-310000046765hp:OffshoreGulfofMexicoMember2020-10-012021-03-310000046765hp:InternationalSolutionsSegmentMember2020-10-012021-03-310000046765us-gaap:AllOtherSegmentsMember2020-10-012021-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:IntersegmentEliminationMember2020-10-012021-03-310000046765hp:OffshoreGulfofMexicoMemberus-gaap:IntersegmentEliminationMember2020-10-012021-03-310000046765us-gaap:IntersegmentEliminationMemberhp:InternationalSolutionsSegmentMember2020-10-012021-03-310000046765us-gaap:IntersegmentEliminationMemberus-gaap:AllOtherSegmentsMember2020-10-012021-03-310000046765us-gaap:IntersegmentEliminationMember2020-10-012021-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2020-10-012021-03-310000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2020-10-012021-03-310000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2020-10-012021-03-310000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2020-10-012021-03-310000046765us-gaap:OperatingSegmentsMember2020-10-012021-03-310000046765us-gaap:MaterialReconcilingItemsMember2022-01-012022-03-310000046765us-gaap:MaterialReconcilingItemsMember2021-01-012021-03-310000046765us-gaap:MaterialReconcilingItemsMember2021-10-012022-03-310000046765us-gaap:MaterialReconcilingItemsMember2020-10-012021-03-310000046765us-gaap:CorporateNonSegmentMember2022-01-012022-03-310000046765us-gaap:CorporateNonSegmentMember2021-01-012021-03-310000046765us-gaap:CorporateNonSegmentMember2021-10-012022-03-310000046765us-gaap:CorporateNonSegmentMember2020-10-012021-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2022-03-310000046765hp:NorthAmericaSolutionsMemberus-gaap:OperatingSegmentsMember2021-09-300000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2022-03-310000046765us-gaap:OperatingSegmentsMemberhp:OffshoreGulfofMexicoMember2021-09-300000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2022-03-310000046765us-gaap:OperatingSegmentsMemberhp:InternationalSolutionsSegmentMember2021-09-300000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2022-03-310000046765us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2021-09-300000046765us-gaap:OperatingSegmentsMember2022-03-310000046765us-gaap:OperatingSegmentsMember2021-09-300000046765us-gaap:CorporateNonSegmentMember2022-03-310000046765us-gaap:CorporateNonSegmentMember2021-09-300000046765country:US2022-01-012022-03-310000046765country:US2021-01-012021-03-310000046765country:US2021-10-012022-03-310000046765country:US2020-10-012021-03-310000046765country:AR2022-01-012022-03-310000046765country:AR2021-01-012021-03-310000046765country:AR2021-10-012022-03-310000046765country:AR2020-10-012021-03-310000046765country:BH2022-01-012022-03-310000046765country:BH2021-01-012021-03-310000046765country:BH2021-10-012022-03-310000046765country:BH2020-10-012021-03-310000046765country:AE2022-01-012022-03-310000046765country:AE2021-01-012021-03-310000046765country:AE2021-10-012022-03-310000046765country:AE2020-10-012021-03-310000046765country:CO2022-01-012022-03-310000046765country:CO2021-01-012021-03-310000046765country:CO2021-10-012022-03-310000046765country:CO2020-10-012021-03-310000046765hp:OtherForeignMember2022-01-012022-03-310000046765hp:OtherForeignMember2021-01-012021-03-310000046765hp:OtherForeignMember2021-10-012022-03-310000046765hp:OtherForeignMember2020-10-012021-03-310000046765hp:AffiliateOfGalileoTechnologiesMemberus-gaap:SubsequentEventMember2022-04-012022-04-300000046765hp:GalileoTechnologiesMemberus-gaap:SubsequentEventMemberhp:FivePercentConvertibleNoteDueApril2027Memberus-gaap:ConvertibleDebtMember2022-04-30
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended: March 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                          to
Commission File Number: 1-4221
hp-20220331_g1.jpg
HELMERICH & PAYNE, INC.
(Exact name of registrant as specified in its charter)
Delaware73-0679879
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

1437 South Boulder Avenue, Suite 1400, Tulsa, Oklahoma, 74119
(Address of principal executive offices) (Zip Code)
(918) 742-5531
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock ($0.10 par value)HPNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filer Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐ No ☒
CLASSOUTSTANDING AT April 20, 2022
Common Stock, $0.10 par value105,287,469



Table of Contents
HELMERICH & PAYNE, INC.
hp-20220331_g2.jpg
INDEX TO FORM 10‑Q
Page

2

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
March 31,September 30,
(in thousands except share data and share amounts)20222021
ASSETS
Current Assets:
Cash and cash equivalents$202,206 $917,534 
Short-term investments148,377 198,700 
Accounts receivable, net of allowance of $2,490 and $2,068, respectively
329,572 228,894 
Inventories of materials and supplies, net83,588 84,057 
Prepaid expenses and other, net97,380 85,928 
Assets held-for-sale57,373 71,453 
Total current assets918,496 1,586,566 
Investments219,295 135,444 
Property, plant and equipment, net3,022,335 3,127,287 
Other Noncurrent Assets:
Goodwill45,653 45,653 
Intangible assets, net70,246 73,838 
Operating lease right-of-use assets45,325 49,187 
Other assets, net13,000 16,153 
Total other noncurrent assets174,224 184,831 
Total assets$4,334,350 $5,034,128 
LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable$105,123 $71,996 
Dividends payable26,697 27,332 
Current portion of long-term debt, net— 483,486 
Accrued liabilities245,778 283,492 
Total current liabilities377,598 866,306 
Noncurrent Liabilities:
Long-term debt, net541,969 541,997 
Deferred income taxes552,263 563,437 
Other125,754 147,757 
Noncurrent liabilities - discontinued operations2,356 2,013 
Total noncurrent liabilities1,222,342 1,255,204 
Commitments and contingencies (Note 13)
Shareholders' Equity:
Common stock, $.10 par value, 160,000,000 shares authorized, 112,222,865 shares issued as of both March 31, 2022 and September 30, 2021, and 105,285,460 and 107,898,859 shares outstanding as of March 31, 2022 and September 30, 2021, respectively
11,222 11,222 
Preferred stock, no par value, 1,000,000 shares authorized, no shares issued
— — 
Additional paid-in capital514,771 529,903 
Retained earnings2,463,665 2,573,375 
Accumulated other comprehensive loss(19,456)(20,244)
Treasury stock, at cost, 6,937,405 shares and 4,324,006 shares as of March 31, 2022 and September 30, 2021, respectively
(235,792)(181,638)
Total shareholders’ equity2,734,410 2,912,618 
Total liabilities and shareholders' equity$4,334,350 $5,034,128 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3

Table of Contents
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
March 31,
Six Months Ended
March 31,
(in thousands, except per share amounts)2022202120222021
OPERATING REVENUES
Drilling services$465,370 $294,026 $872,904 $538,807 
Other2,227 2,145 4,475 3,741 
467,597 296,171 877,379 542,548 
OPERATING COSTS AND EXPENSES
Drilling services operating expenses, excluding depreciation and amortization339,759 230,313 639,411 429,002 
Other operating expenses1,181 1,274 2,363 2,636 
Depreciation and amortization102,937 106,417 203,374 213,278 
Research and development6,387 5,334 12,914 10,917 
Selling, general and administrative47,051 39,349 90,766 78,652 
Asset impairment charge— 54,284 4,363 54,284 
Restructuring charges63 1,608 805 1,746 
Gain on reimbursement of drilling equipment(6,448)(3,748)(11,702)(5,939)
Other (gain) loss on sale of assets(716)22,263 313 12,118 
490,214 457,094 942,607 796,694 
OPERATING LOSS FROM CONTINUING OPERATIONS(22,617)(160,923)(65,228)(254,146)
Other income (expense)
Interest and dividend income3,399 4,819 5,988 6,698 
Interest expense(4,390)(5,759)(10,504)(11,898)
Gain on investment securities22,132 2,520 69,994 5,444 
Loss on extinguishment of debt— — (60,083)— 
Other(476)(577)(1,018)(2,057)
20,665 1,003 4,377 (1,813)
Loss from continuing operations before income taxes (1,952)(159,920)(60,851)(255,959)
Income tax expense (benefit)2,672 (36,624)(4,896)(54,739)
Loss from continuing operations(4,624)(123,296)(55,955)(201,220)
Income (loss) from discontinued operations before income taxes(352)2,293 (383)9,786 
Income tax provision— — — — 
Income (loss) from discontinued operations(352)2,293 (383)9,786 
NET LOSS$(4,976)$(121,003)$(56,338)$(191,434)
Basic earnings (loss) per common share:
Loss from continuing operations$(0.05)$(1.15)$(0.53)$(1.87)
Income from discontinued operations— 0.02 — 0.09 
Net loss$(0.05)$(1.13)$(0.53)$(1.78)
Diluted earnings (loss) per common share:
Loss from continuing operations$(0.05)$(1.15)$(0.53)$(1.87)
Income from discontinued operations— 0.02 — 0.09 
Net loss$(0.05)$(1.13)$(0.53)$(1.78)
Weighted average shares outstanding:
Basic105,393 107,861 106,494 107,738 
Diluted105,393 107,861 106,494 107,738 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4

Table of Contents
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Three Months Ended
March 31,
Six Months Ended
March 31,
(in thousands)2022202120222021
Net loss$(4,976)$(121,003)$(56,338)$(191,434)
Other comprehensive income, net of income taxes:
Net change related to employee benefit plans, net of income taxes of $(0.1) million and $(0.2) million for the three and six months ended March 31, 2022, respectively, and $(0.1) million and $(0.3) million for the three and six months ended March 31, 2021.
394 457 788 914 
Other comprehensive income394 457 788 914 
Comprehensive loss$(4,582)$(120,546)$(55,550)$(190,520)
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5

Table of Contents
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Three and Six Months Ended March 31, 2022
(in thousands, except per share amounts)Common StockAdditional
Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury Stock
SharesAmountSharesAmountTotal
Balance, September 30, 2021112,222 $11,222 $529,903 $2,573,375 $(20,244)4,324 $(181,638)$2,912,618 
Comprehensive income (loss):
Net loss— — — (51,362)— — — (51,362)
Other comprehensive income— — — — 394 — — 394 
Dividends declared ($0.25 per share)
— — — (26,807)— — — (26,807)
Vesting of restricted stock awards, net of shares withheld for employee taxes— — (21,152)— — (381)17,040 (4,112)
Stock-based compensation— — 6,218 — — — — 6,218 
Share repurchases— — — — — 2,548 (60,358)(60,358)
Balance, December 31, 2021112,222 $11,222 $514,969 $2,495,206 $(19,850)6,491 $(224,956)$2,776,591 
Comprehensive income:
Net loss— — — (4,976)— — — (4,976)
Other comprehensive income— — — — 394 — — 394 
Dividends declared ($0.25 per share)
— — — (26,565)— — — (26,565)
Vesting of restricted stock awards, net of shares withheld for employee taxes— (7,197)— — (161)5,805 (1,392)
Stock-based compensation— — 6,999 — — — — 6,999 
Share repurchases— — — — — 607 (16,641)(16,641)
Balance, March 31, 2022112,222 $11,222 $514,771 $2,463,665 $(19,456)6,937 $(235,792)$2,734,410 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6

Table of Contents
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Three and Six Months Ended March 31, 2021
(in thousands, except per share amounts)Common StockAdditional
Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury Stock
SharesAmountSharesAmountTotal
Balance, September 30, 2020112,151 $11,215 $521,628 $3,010,012 $(26,188)4,663 $(198,153)$3,318,514 
Comprehensive income (loss):
Net loss— — — (70,431)— — — (70,431)
Other comprehensive income— — — — 457 — — 457 
Dividends declared ($0.25 per share)
— — — (27,324)— — — (27,324)
Vesting of restricted stock awards, net of shares withheld for employee taxes72 (16,742)— — (295)14,618 (2,117)
Stock-based compensation— — 7,451 — — — — 7,451 
Cumulative effect adjustment for adoption of ASU No. 2016-13— — — (1,251)— — — (1,251)
Other— — (381)— — — — (381)
Balance, December 31, 2020112,223 $11,222 $511,956 $2,911,006 $(25,731)4,368 $(183,535)$3,224,918 
Comprehensive income:
Net loss— — — (121,003)— — — (121,003)
Other comprehensive income— — — — 457 — — 457 
Dividends declared ($0.25 per share)
— — — (27,268)— — — (27,268)
Vesting of restricted stock awards, net of shares withheld for employee taxes— — (1,678)— — (39)1,678 — 
Stock-based compensation— — 6,826 — — — — 6,826 
Other— — (234)— — — — (234)
Balance, March 31, 2021112,223 $11,222 $516,870 $2,762,735 $(25,274)4,329 $(181,857)$3,083,696 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
7

Table of Contents
HELMERICH & PAYNE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Months Ended March 31,
(in thousands)20222021
CASH FLOWS FROM OPERATING ACTIVITIES:
NET LOSS$(56,338)$(191,434)
Adjustment for (income) loss from discontinued operations383 (9,786)
Loss from continuing operations(55,955)(201,220)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization203,374 213,278 
Asset impairment charge4,363 54,284 
Amortization of debt discount and debt issuance costs559 920 
Loss on extinguishment of debt60,083 — 
Provision for credit loss669 (227)
Provision for obsolete inventory(761)423 
Stock-based compensation14,163 14,277 
Gain on investment securities(69,994)(5,444)
Gain on reimbursement of drilling equipment(11,702)(5,939)
Other loss on sale of assets313 12,118 
Deferred income tax benefit(11,597)(46,068)
Other(3,526)3,646 
Change in assets and liabilities:
Accounts receivable(103,751)(8,498)
Inventories of materials and supplies158 7,159 
Prepaid expenses and other(4,068)(7,951)
Other noncurrent assets10,375 (3,696)
Accounts payable32,138 25,277 
Accrued liabilities(29,322)(451)
Deferred income tax liability196 27 
Other noncurrent liabilities(16,777)6,912 
Net cash provided by operating activities from continuing operations18,938 58,827 
Net cash used in operating activities from discontinued operations(42)(25)
Net cash provided by operating activities18,896 58,802 
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures(104,482)(30,745)
Other capital expenditures related to assets held-for-sale(10,550)— 
Purchase of short-term investments(68,565)(105,662)
Purchase of long-term investments(14,124)(1,069)
Proceeds from sale of short-term investments117,456 63,742 
Proceeds from asset sales34,944 13,419 
Net cash used in investing activities(45,321)(60,315)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid(54,007)(54,230)
Payments for employee taxes on net settlement of equity awards(5,503)(2,119)
Payment of contingent consideration from acquisition of business(250)(250)
Payments for early extinguishment of long-term debt(487,148)— 
Make-whole premium payment(56,421)— 
Share repurchases(76,999)— 
Other(587)— 
Net cash used in financing activities(680,915)(56,599)
Net decrease in cash and cash equivalents and restricted cash(707,340)(58,112)
Cash and cash equivalents and restricted cash, beginning of period936,716 536,747 
Cash and cash equivalents and restricted cash, end of period$229,376 $478,635 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period:
Interest paid$10,798 $11,473 
Income tax paid (received), net633 (31,965)
Cash paid for amounts included in the measurement of lease liabilities:
Payments for operating leases6,069 8,970 
Non-cash operating and investing activities:
Changes in accounts payable and accrued liabilities related to purchases of property, plant and equipment(2,431)(1,296)
Changes in accounts receivable, property, plant and equipment and other noncurrent assets related to the sale of equipment— 9,290 
Cumulative effect adjustment for adoption of ASU No. 2016-13— (1,251)
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
8

Table of Contents
HELMERICH & PAYNE, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 NATURE OF OPERATIONS
Helmerich & Payne, Inc. (“H&P,” which, together with its subsidiaries, is identified as the “Company,” “we,” “us,” or “our,” except where stated or the context requires otherwise) through its operating subsidiaries provides performance-driven drilling solutions and technologies that are intended to make hydrocarbon recovery safer and more economical for oil and gas exploration and production companies.
Our drilling services operations are organized into the following reportable operating business segments: North America Solutions, Offshore Gulf of Mexico and International Solutions. Our real estate operations, our incubator program for new research and development projects and our wholly-owned captive insurance companies are included in "Other." Refer to Note 14—Business Segments and Geographic Information for further details on our reportable segments.
Our North America Solutions operations are primarily located in Colorado, Louisiana, New Mexico, Nevada, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia and Wyoming. Additionally, our Offshore Gulf of Mexico operations are conducted in Louisiana and in U.S. federal waters in the Gulf of Mexico and in our International Solutions we have operations in four international locations: Argentina, Bahrain, Colombia and United Arab Emirates. 
We also own and operate limited commercial real estate properties. Our real estate assets, which are located exclusively within Tulsa, Oklahoma, include a shopping center and undeveloped real estate.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, RISKS AND UNCERTAINTIES
Interim Financial Information
The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) pertaining to interim financial information. Accordingly, these interim financial statements do not include all information or footnote disclosures required by GAAP for complete financial statements and, therefore, should be read in conjunction with the Consolidated Financial Statements and notes thereto in our 2021 Annual Report on Form 10-K and other current filings with the SEC. In the opinion of management, all adjustments, consisting of those of a normal recurring nature, necessary to present fairly the results of the periods presented have been included. The results of operations for the interim periods presented may not necessarily be indicative of the results to be expected for the full year.
Principles of Consolidation
The Unaudited Condensed Consolidated Financial Statements include the accounts of Helmerich & Payne, Inc. and its domestic and foreign subsidiaries. Consolidation of a subsidiary begins when the Company gains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the fiscal year are included in the Unaudited Condensed Consolidated Statements of Operations and Unaudited Condensed Consolidated Statements of Comprehensive Loss from the date the Company gains control until the date when the Company ceases to control the subsidiary. All intercompany accounts and transactions have been eliminated upon consolidation.
COVID-19 and Russia-Ukraine Conflict
The direct impacts of the COVID-19 pandemic on the Company have diminished significantly as health guidelines and restrictions have eased in most jurisdictions in which we operate. Since the COVID-19 outbreak began, no rigs have been fully shut down (other than temporary shutdowns for disinfecting and the suspension for a certain period of time on one of our international rigs) and these temporary shutdowns did not have a significant impact on service.
The COVID-19 pandemic is predicted to continue and increases in infection rates may cause governmental authorities in highly impacted areas to impose more rigorous restrictions on business and social activities. We have experienced, and may experience in the future, some periodic disruptions to our business operations from government restrictions. We work to comply with all regulations of governmental authorities in the jurisdictions where our operations reside. In some cases, policies and procedures are more stringent in our foreign operations than in our North America operations.
9

Table of Contents
More recently, the Russian Federation's invasion of Ukraine and the related international reaction to the invasion, including sanctions, have introduced additional volatility in commodity prices. As we have no operations in the impacted regions of this conflict, we do not expect any direct impact to our operations. Additionally, we do not source supplies from these regions; however, the far-reaching ramifications of this conflict could result in some inflationary pressure within our supply chain.
From a financial perspective, we believe the Company is well positioned to manage through events, even protracted ones, that may result from market disruptions and the related commodity price volatility. More recent events, like the COVID-19 global pandemic and the Russian invasion into the Ukraine, have elevated commodity price volatility and have other far reaching global market ramifications.
At March 31, 2022, the Company had cash and cash equivalents and short-term investments of $350.6 million. The 2018 Credit Facility (as defined within Note 6—Debt) has $750.0 million in aggregate availability with a maximum of $75.0 million available for use as letters of credit. As of March 31, 2022, there were no borrowings or letters of credit outstanding, leaving $750.0 million available to borrow under the 2018 Credit Facility. We currently do not anticipate the need to draw on the 2018 Credit Facility. Furthermore, the Company's 2031 Notes (as defined within Note 6—Debt) do not mature until September 29, 2031. On March 8, 2022, we entered into the second amendment to the 2018 Credit Facility, which, among other things, raised the number of potential future extensions of the maturity date applicable to extending lenders from one to two such potential extensions and replaced provisions in respect of interest rate determinations that were based on the London Interbank Offered Rate with provisions based on the Secured Overnight Financing Rate. Lenders with $680.0 million of commitments under the 2018 Credit Facility also exercised their option to extend the maturity of the 2018 Credit Facility from November 12, 2025 to November 11, 2026. Refer to Note 6—Debt for further details.
On September 27, 2021, the Company delivered a conditional notice of optional full redemption for all of the outstanding 4.65 percent unsecured senior notes due 2025 (the "2025 Notes") at a redemption price calculated in accordance with the indenture governing the 2025 Notes, plus accrued and unpaid interest on the 2025 Notes to be redeemed. On September 29, 2021, we issued $550.0 million aggregate principal amount of the 2.90 percent unsecured senior notes due 2031 (the "2031 Notes"). The Company’s obligation to redeem the 2025 Notes was conditioned upon the prior consummation of the issuance of the 2031 Notes, which was satisfied on September 29, 2021. The 2031 Notes mature on September 29, 2031. On October 27, 2021, we redeemed all of the outstanding 2025 Notes. As a result, these notes were included in the current portion of long-term debt on our Consolidated Balance Sheets as of September 30, 2021. The associated make-whole premium of $56.4 million and the write off of the unamortized discount and debt issuance costs of $3.7 million were recognized during the first fiscal quarter of 2022 contemporaneously with the October 27, 2021 debt extinguishment. These amounts were recorded in Loss on Extinguishment of Debt in our Unaudited Condensed Consolidated Statements of Operations during the six months ended March 31, 2022. Refer to Note 6—Debt for further details.
Cash, Cash Equivalents, and Restricted Cash
Cash and cash equivalents include cash on hand, demand deposits with banks and all highly liquid investments with original maturities of three months or less. Our cash, cash equivalents and short-term investments are subject to potential credit risk, and certain of our cash accounts carry balances greater than the federally insured limits.
We had restricted cash of $27.2 million and $51.4 million at March 31, 2022 and 2021, respectively, and $19.2 million and $48.9 million at September 30, 2021 and 2020, respectively. Of the total restricted cash at March 31, 2022 and September 30, 2021, $1.1 million and $1.5 million, respectively, is related to the acquisition of drilling technology companies, and $25.9 million and $17.7 million, respectively, represents an amount management has elected to restrict for the purpose of potential insurance claims in our wholly-owned captive insurance companies. The restricted amounts are primarily invested in short-term money market securities.
The cash, cash equivalents, and restricted cash are reflected within the following line items on the Unaudited Condensed Consolidated Balance Sheets:
March 31,September 30,
(in thousands)2022202120212020
Cash and cash equivalents$202,206 $427,243 $917,534 $487,884 
Restricted cash
Prepaid expenses and other, net26,438 48,457 18,350 45,577 
Other assets, net732 2,935 832 3,286 
Total cash, cash equivalents, and restricted cash$229,376 $478,635 $936,716 $536,747 
During the six months ended March 31, 2022, our cash, cash equivalents, and restricted cash balance decreased approximately $707.3 million compared to our balance at September 30, 2021. This change was primarily driven by the redemption of all the outstanding 2025 Notes, resulting in a cash outflow of $487.1 million. Additionally, the associated make-whole premium of $56.4 million was paid during the first fiscal quarter of 2022 contemporaneously with the October 27, 2021 debt extinguishment.
10

Table of Contents
Recently Issued Accounting Updates
Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of Accounting Standards Updates ("ASUs") to the FASB Accounting Standards Codification ("ASC"). We consider the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable, clarifications of ASUs listed below, immaterial, or already adopted by the Company.
The following table provides a brief description of a recently adopted accounting pronouncement and our analysis of the effects on our financial statements:
Standard
Description
Date of
Adoption
Effect on the Financial Statements or Other Significant Matters
Recently Adopted Accounting Pronouncements
ASU No. 2019-12, Financial Instruments – Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes
This ASU simplifies the accounting for income taxes by removing certain exceptions related to Topic 740. The ASU also improves consistent application of and simplifies GAAP for other areas of Topic 740 by clarifying and amending existing guidance. This update is effective for annual and interim periods beginning after December 15, 2020. Early adoption of the amendment is permitted, including adoption in any interim period for public entities for periods for which financial statements have not yet been issued. An entity that elects to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. Upon adoption, the amendments addressed in this ASU will be applied either prospectively, retrospectively or on a modified retrospective basis through a cumulative effect adjustment to retained earnings. This update is effective for annual periods beginning after December 15, 2020.    
October 1, 2021
We adopted this ASU during the first quarter of fiscal year 2022. The adoption did not have a material effect on our Unaudited Condensed Consolidated Financial Statements and disclosures.
Standards that are not yet adopted as of March 31, 2022
ASU No. 2020-06, Debt with conversion and other options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s own equity (subtopic 815-40): Accounting For Convertible Instruments and Contracts In An Entity’s Own Equity
This ASU reduces the complexity of accounting for convertible debt and other equity-linked instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital.

October 1, 2022
We are currently evaluating the impact of this ASU on our Unaudited Condensed Consolidated Financial Statements and disclosures.
Self-Insurance
Our wholly-owned insurance captives ("Captives") incurred direct operating costs consisting primarily of adjustments to accruals for estimated losses of $1.8 million and $2.3 million for the three months ended March 31, 2022 and 2021, respectively, and $(0.4) million and $2.8 million for the six months ended March 31, 2022 and 2021, respectively, and rig casualty insurance premiums of $7.9 million and $5.0 million for the three months ended March 31, 2022 and 2021, respectively, and $16.7 million and $7.5 million for the six months ended March 31, 2022 and 2021, respectively, and were recorded within drilling services operating expenses in our Unaudited Condensed Consolidated Statement of Operations. Intercompany premium revenues recorded by the Captives amounted to $13.2 million and $8.7 million during the three months ended March 31, 2022 and 2021, respectively, and $26.9 million and $15.8 million during the six months ended March 31, 2022 and 2021, respectively, which were eliminated upon consolidation. These intercompany insurance premiums are reflected as segment operating expenses within the North America Solutions, Offshore Gulf of Mexico, and International Solutions reportable operating segments and are reflected as intersegment sales within "Other." The Company self-insures employee health plan exposures in excess of employee deductibles. Starting in the second quarter of fiscal year 2020, the Captives' insurer issued a stop-loss program that will reimburse the Company's health plan for claims that exceed $50,000. This program is reviewed at the end of each policy year by an outside actuary. Our medical stop loss operating expenses for the three months ended March 31, 2022 and 2021 were $3.6 million and $3.1 million, respectively, and $6.9 million and $5.4 million for the six months ended March 31, 2022 and 2021, respectively.
11

Table of Contents
International Solutions Drilling Risks
International Solutions drilling operations may significantly contribute to our revenues and net operating income (loss). There can be no assurance that we will be able to successfully conduct such operations, and a failure to do so may have an adverse effect on our financial position, results of operations, and cash flows. Also, the success of our International Solutions operations will be subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general and regional economic conditions, fluctuations in currency exchange rates, modified exchange controls, changes in international regulatory requirements and international employment issues, risk of expropriation of real and personal property and the burden of complying with foreign laws. Additionally, in the event that extended labor strikes occur or a country experiences significant political, economic or social instability, we could experience shortages in labor and/or material and supplies necessary to operate some of our drilling rigs, thereby potentially causing an adverse material effect on our business, financial condition and results of operations.
We have also experienced certain risks specific to our Argentine operations. In Argentina, while our dayrate is denominated in U.S. dollars, we are paid in the equivalent of Argentine pesos. The Argentine branch of one of our second-tier subsidiaries remits U.S. dollars to its U.S. parent by converting the Argentine pesos into U.S. dollars through the Argentine Foreign Exchange Market and repatriating the U.S. dollars. Argentina also has a history of implementing currency controls which restrict the conversion and repatriation of U.S. dollars. In September 2020, Argentina implemented additional currency controls in an effort to preserve Argentina's U.S. dollar reserves. As a result of these currency controls, our ability to remit funds from our Argentine subsidiary to its U.S. parent has been limited. In the past, the Argentine government has also instituted price controls on crude oil, diesel and gasoline prices and instituted an exchange rate freeze in connection with those prices. These price controls and an exchange rate freeze could be instituted again in the future. Further, there are additional concerns regarding Argentina's debt burden, notwithstanding Argentina's restructuring deal with international bondholders in August 2020, as Argentina attempts to manage its substantial sovereign debt issues. These concerns could further negatively impact Argentina's economy and adversely affect our Argentine operations. Argentina’s economy is considered highly inflationary, which is defined as cumulative inflation rates exceeding 100 percent in the most recent three-year period based on inflation data published by the respective governments. Nonetheless, all of our foreign subsidiaries use the U.S. dollar as the functional currency and local currency monetary assets and liabilities are remeasured into U.S. dollars with gains and losses resulting from foreign currency transactions included in current results of operations.
We recorded aggregate foreign currency losses of $2.4 million for both the three months ended March 31, 2022 and 2021, and $3.3 million and $4.2 million for the six months ended March 31, 2022 and 2021, respectively. In the future, we may incur larger currency devaluations, foreign exchange restrictions or other difficulties repatriating U.S. dollars from Argentina or elsewhere, which could have a material adverse impact on our business, financial condition and results of operations. As of March 31, 2022, our cash balance in Argentina was $43.2 million.
Because of the impact of local laws, our future operations in certain areas may be conducted through entities in which local citizens own interests and through entities (including joint ventures) in which we hold only a minority interest or pursuant to arrangements under which we conduct operations under contract to local entities. While we believe that neither operating through such entities nor pursuant to such arrangements would have a material adverse effect on our operations or revenues, there can be no assurance that we will in all cases be able to structure or restructure our operations to conform to local law (or the administration thereof) on terms acceptable to us.
Although we attempt to minimize the potential impact of such risks by operating in more than one geographical area, during the three and six months ended March 31, 2022, approximately 5.9 percent and 7.5 percent of our operating revenues were generated from international locations in our drilling business compared to 5.2 percent and 4.9 percent during the three and six months ended March 31, 2021, respectively. During the three and six months ended March 31, 2022, approximately 75.8 percent and 76.6 percent of operating revenues from international locations were from operations in South America, compared to 51.4 percent and 37.6 percent during the three and six months ended March 31, 2021, respectively. Substantially all of the South American operating revenues were from Argentina and Colombia. The future occurrence of one or more international events arising from the types of risks described above could have a material adverse impact on our business, financial condition and results of operations.
12

Table of Contents
NOTE 3 DISCONTINUED OPERATIONS
Noncurrent liabilities from discontinued operations include an uncertain tax liability related to the country of Venezuela. Expenses incurred for in-country obligations are reported as discontinued operations within our Unaudited Condensed Consolidated Statements of Operations. 
The activity for the three and six months ended March 31, 2022 and 2021 was primarily due to the remeasurement of an uncertain tax liability as a result of the devaluation of the Venezuela Bolivar.  Early in 2018, the Venezuelan government announced that it changed the existing dual-rate foreign currency exchange system by eliminating its heavily subsidized foreign exchange rate, which was 10 Bolivars per United States dollar, and relaunched an exchange system known as DICOM. The Venezuela government also established a new currency called the “Sovereign Bolivar,” which was determined by the elimination of five zeros from the old currency. The DICOM floating rate was approximately 4,181,782 and 1,987,185 Bolivars per United States dollar at September 30, 2021, and March 31, 2021, respectively. In October 2021, the Venezuela government launched another monetary overhaul by cutting six zeros from the Bolivar in response to hyperinflation and to simplifying accounting. As such, as of March 31, 2022, the DICOM floating rate was approximately 4.38 Bolivars per United States dollar. The DICOM floating rate might not reflect the barter market exchange rates.
NOTE 4 PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of March 31, 2022 and September 30, 2021 consisted of the following:
(in thousands)Estimated Useful LivesMarch 31, 2022September 30, 2021
Drilling services equipment
4 - 15 years
$6,284,174 $6,229,011 
Tubulars4 years555,968 573,900 
Real estate properties
10 - 45 years
44,916 43,302 
Other
2 - 23 years
420,589 459,741 
Construction in progress (1)
  62,959 47,587 
  7,368,606 7,353,541 
Accumulated depreciation  (4,346,271)(4,226,254)
Property, plant and equipment, net  $3,022,335 $3,127,287 
Assets held-for-sale$57,373 $71,453 
(1)Included in construction in progress are costs for projects in progress to upgrade or refurbish certain rigs in our existing fleet.  Additionally, we include other capital maintenance purchase orders that are open/in process.  As these various projects are completed, the costs are then classified to their appropriate useful life category.
Depreciation
Depreciation expense in the Unaudited Condensed Consolidated Statements of Operations was $101.1 million and $104.6 million, including $2.5 million and $0.5 million in abandonments, for the three months ended March 31, 2022 and 2021, respectively. Depreciation expense in the Unaudited Condensed Consolidated Statements of Operations was $199.8 million and $209.7 million, including $3.8 million and $0.4 million in abandonments for the six months ended March 31, 2022 and 2021, respectively.
Assets Held-for-Sale
The following table summarizes the balance (in thousands) of our assets held-for-sale at the dates indicated below:
Balance at September 30, 2021$71,453 
Plus:
Asset additions1,459 
Less:
Sale of assets held-for-sale(15,539)
Balance at March 31, 2022
$57,373 
13

Table of Contents
In March 2021, the Company's leadership continued the execution of the current strategy, which was initially introduced in 2019, focusing on operating various types of highly capable upgraded rigs and phasing out the older, less capable fleet. As a result, the Company has undertaken a plan to sell 71 Domestic non-super-spec rigs, all within our North America Solutions segment, the majority of which were previously decommissioned, written down and/or held as capital spares. The book values of those assets were written down to $13.5 million, which represents their fair value less estimated costs to sell, and were reclassified as held-for-sale in the second and third quarters of fiscal year 2021. During the fiscal year ended September 30, 2021, we completed the sale of a portion of the assets with a net book value of $6.5 million that were originally classified as held-for-sale during the second and third quarters of fiscal year 2021. Additionally, during the six months ended March 31, 2022, we completed the sale of a portion of the remaining assets with a net book value of $1.6 million that were originally classified as held-for-sale during the second and third quarters of fiscal year 2021.
During September 2021, the Company agreed to sell eight FlexRig® land rigs with an aggregate net book value of $55.6 million to ADNOC Drilling Company P.J.S.C. ("ADNOC Drilling") for $86.5 million. Two of the eight rigs were already located in the U.A.E where ADNOC Drilling is domiciled with the remaining six rigs to be shipped from the United States. We received the $86.5 million in cash consideration in advance of delivering the rigs. As part of the sales agreement, the rigs will be delivered and commissioned in stages over a twelve-month period subject to acceptance upon successful completion of final inspection on customary terms and conditions. During the second quarter of fiscal year 2022, ADNOC Drilling accepted delivery of the two rigs located in the U.A.E. with a net book value of $4.1 million and, as a result, we recognized a gain of $1.2 million, after incurring $2.4 million of selling costs, during the three months ended March 31, 2022 and the rigs were removed from assets classified as held-for-sale as of March 31, 2022. The gain of $1.2 million is recorded in Other (Gain) Loss on Sale of Assets within our Unaudited Condensed Consolidated Statement of Operations for the three and six months ended March 31, 2022. The remaining cash proceeds received in advance of rig delivery and acceptance of $78.8 million is recorded in Accrued Liabilities within our Unaudited Condensed Consolidated Balance Sheets as of March 31, 2022. Additionally, the six remaining rigs in the United States are classified as held-for-sale in the Unaudited Condensed Consolidated Balance Sheets until each rig is delivered and accepted, at which time any related gain/loss on the sale will be recognized in the Unaudited Condensed Consolidated Statement of Operations. Estimated cost to sell related to the remaining rigs is approximately $26.6 million, including approximately $11.2 million of expenses incurred during the six months ended March 31, 2022, and approximately $15.4 million of expenses to be incurred in future periods. We paid approximately $10.6 million in cash charges related to these costs during the six months ended March 31, 2022.
During the fiscal year ended September 30, 2021, we formalized a plan to sell assets related to two of our lower margin service offerings, trucking and casing running assets, which contributed approximately 2.8 percent to our consolidated revenues during fiscal year 2021, all within our North America Solutions segment. The combined net book values of these assets of $23.2 million were written down to their combined fair value less estimated cost to sell of $8.8 million, and were reclassified as held-for-sale during the fourth quarter of fiscal year 2021. During the six months ended March 31, 2022, we closed on the sale of these assets in two separate transactions. The sale of our trucking assets was completed on November 3, 2021 while the sale of our casing running assets was completed on November 15, 2021 for total consideration less costs to sell of $6.0 million, in addition to the possibility of future earnout revenue, resulting in a loss of $3.4 million. Losses related to the sale of these assets are recorded in Other (Gain) Loss on Sale of Assets within our Unaudited Condensed Consolidated Statements of Operations.
During the first quarter of fiscal year 2022, we identified two partial rig substructures that met the asset held-for-sale criteria and were reclassified as assets held-for-sale on our Unaudited Condensed Consolidated Balance Sheets. The combined net book value of the rig substructures of $2.0 million were written down to their estimated scrap value of $0.1 million, resulting in a non-cash impairment charge of $1.9 million within our North America Solutions segment and recorded in the Unaudited Condensed Consolidated Statement of Operations for the six months ended March 31, 2022. During the three months ended March 31, 2022, we completed the sale of a portion of the assets with a net book value of approximately $0.1 million, resulting in no gain or loss as a result of the sale.
During the first quarter of fiscal year 2022, we identified two international FlexRig® drilling rigs located in Colombia that met the asset held-for-sale criteria and were reclassified as assets held-for-sale on our Unaudited Condensed Consolidated Balance Sheets. In conjunction with establishing a plan to sell the two international FlexRig® drilling rigs, we recognized a non-cash impairment charge of $2.5 million within our International Solutions segment and recorded in the Unaudited Condensed Consolidated Statement of Operations during the six months ended March 31, 2022, as the rigs aggregate net book value of $3.4 million exceeded the fair value of the rigs less estimated cost to sell of $0.9 million. During the three months ended March 31, 2022, we completed the sale of the two international FlexRig® drilling rigs for total consideration of $0.9 million, resulting in no gain or loss as a result of the sale.
The significant assumptions utilized in the valuation of assets held-for-sale were based on our intended method of disposal, historical sales of similar assets, and market quotes and are classified as Level 2 and Level 3 inputs by ASC Topic 820, Fair Value Measurement and Disclosures. Although we believe the assumptions used in our analysis are reasonable and appropriate, different assumptions and estimates could materially impact the analysis and our resulting conclusion.
14

Table of Contents
(Gain)/Loss on Sale of Assets
We had a gain of $6.4 million and $11.7 million, during the three and six months ended March 31, 2022, respectively, and $3.8 million and $5.9 million, during the three and six months ended March 31, 2021, respectively, related to customer reimbursement for the replacement value of lost or damaged drill pipe. Gains related to these asset sales are recorded in Gains on Reimbursement of Drilling Equipment within our Unaudited Condensed Consolidated Statements of Operations.
During the three and six months ended March 31, 2022, we had a (gain) loss of $(0.7) million and $0.3 million, respectively, related to the sale of rig equipment and other capital assets. During the first quarter of fiscal year 2022, we closed on the sale of our trucking and casing running assets resulting in a loss of $3.4 million, as mentioned above. During the second quarter of fiscal year 2022, ADNOC Drilling accepted delivery of two rigs resulting in a gain of $1.2 million, as mentioned above. The (gain) loss related to the sale of these assets are recorded in Other (Gain) Loss on Sale of Assets within our Unaudited Condensed Consolidated Statements of Operations.
During the three and six months ended March 31, 2021, we had a loss of $22.3 million and $12.1 million, respectively, related to sale of rig equipment and other capital assets. During the first quarter of fiscal year 2021, we completed the sale of an offshore platform rig within our Offshore Gulf of Mexico operating segment resulting in a gain of $9.2 million. During the second quarter of fiscal year 2021, we sold excess drilling equipment and spares, which resulted in a net loss of $23.0 million. The (gain) loss related to these asset sales were recorded in Other (Gain) Loss on Sale of Assets within our Unaudited Condensed Consolidated Statements of Operations.
NOTE 5 GOODWILL AND INTANGIBLE ASSETS
Goodwill
Goodwill represents the excess of the purchase price over the fair values of the assets acquired and liabilities assumed in a business combination, at the date of acquisition. Goodwill is not amortized but is tested for potential impairment at the reporting unit level, at a minimum on an annual basis, or when indications of potential impairment exist. All of our goodwill is within our North America Solutions reportable segment. 
During the three and six months ended March 31, 2022, we had no additions or impairments to goodwill. As of March 31, 2022 and September 30, 2021, the goodwill balance was $45.7 million.
Intangible Assets
Finite-lived intangible assets are amortized using the straight-line method over the period in which these assets contribute to our cash flows and are evaluated for impairment in accordance with our policies for valuation of long-lived assets.  All of our intangible assets are within our North America Solutions reportable segment. Intangible assets consist of the following:
 March 31, 2022September 30, 2021
(in thousands)Weighted Average Estimated Useful LivesGross
Carrying
Amount
Accumulated
Amortization
NetGross
Carrying
Amount
Accumulated
Amortization
Net
Finite-lived intangible asset:      
Developed technology15 years$89,096 $25,160 $63,936 $89,096 $22,182 $66,914 
Intellectual property13 years1,500 272 1,228 1,500 216 1,284 
Trade name20 years5,865 1,316 4,549 5,865 1,158 4,707 
Customer relationships5 years4,000 3,467 533 4,000 3,067 933 
$100,461 $30,215 $70,246 $100,461 $26,623 $73,838 
Amortization expense in the Unaudited Condensed Consolidated Statements of Operations was $1.8 million for both the three months ended March 31, 2022 and 2021, and $3.6 million for both the six months ended March 31, 2022 and 2021. Amortization is estimated to be approximately $3.6 million for the remainder of fiscal year 2022, approximately $6.5 million for fiscal year 2023, and approximately $6.4 million for fiscal years 2024, 2025 and 2026.
15

Table of Contents
NOTE 6 DEBT
We had the following unsecured long-term debt outstanding with maturities shown in the following table:
March 31, 2022September 30, 2021
(in thousands)Face
Amount
Unamortized
Discount and Debt Issuance
Cost
Book
Value
Face
Amount
Unamortized
Discount and Debt Issuance
Cost
Book
Value
Unsecured senior notes:
Due March 19, 2025$— $— $— $487,148 $(3,662)$483,486 
Due September 29, 2031550,000 (8,031)541,969 550,000 (8,003)541,997 
550,000 (8,031)541,969 1,037,148 (11,665)1,025,483 
Less long-term debt due within one year— — — (487,148)3,662 (483,486)
Long-term debt$550,000 $(8,031)$541,969 $550,000 $(8,003)$541,997 
Senior Notes
2.90% Senior Notes due 2031 On September 29, 2021, we issued $550.0 million aggregate principal amount of 2.90 percent 2031 Notes in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act (“Rule 144A”) and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act (“Regulation S”). Interest on the 2031 Notes is payable semi-annually on March 29 and September 29 of each year, commencing on March 29, 2022. The 2031 Notes will mature on September 29, 2031 and bear interest at a rate of 2.90 percent per annum.
The indenture governing the 2031 Notes contains certain covenants that, among other things and subject to certain exceptions, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company. The indenture governing the 2031 Notes also contains customary events of default with respect to the 2031 Notes.
4.65% Senior Notes due 2025 On December 20, 2018, we issued approximately $487.1 million in aggregate principal amount of the 2025 Notes. Interest on the 2025 Notes was payable semi-annually on March 15 and September 15 of each year, commencing on March 15, 2019. The debt issuance cost was being amortized straight-line over the stated life of the obligation, which approximated the effective interest method.
On September 27, 2021, the Company delivered a conditional notice of optional full redemption for all of the outstanding 2025 Notes at a redemption price calculated in accordance with the indenture governing the 2025 Notes, plus accrued and unpaid interest on the 2025 Notes to be redeemed. The Company financed the redemption of the 2025 Notes with the net proceeds from the offering of the 2031 Notes, together with cash on hand. The Company’s obligation to redeem the 2025 Notes was conditioned upon the prior consummation of the issuance of the 2031 Notes, which was satisfied on September 29, 2021.
On October 27, 2021, we redeemed all of the outstanding 2025 Notes. As a result, the associated make-whole premium of $56.4 million and the write off of the unamortized discount and debt issuance costs of $3.7 million were recognized during the first fiscal quarter of 2022 contemporaneously with the October 27, 2021 debt extinguishment and recorded in Loss on Extinguishment of Debt on our Unaudited Condensed Consolidated Statements of Operations during the six months ended March 31, 2022.
Credit Facilities
On November 13, 2018, we entered into a credit agreement by and among the Company, as borrower, Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto, which was amended on November 13, 2019, providing for an unsecured revolving credit facility (as amended, the “2018 Credit Facility”), that was set to mature on November 13, 2024. On April 16, 2021, lenders with $680.0 million of commitments under the 2018 Credit Facility exercised their option to extend the maturity of the 2018 Credit Facility from November 13, 2024 to November 12, 2025. Additionally, on March 8, 2022, we entered into the second amendment to the 2018 Credit Facility, which, among other things, raised the number of potential future extensions of the maturity date applicable to extending lenders from one to two such potential extensions and replaced provisions in respect of interest rate determinations that were based on the London Interbank Offered Rate with provisions based on the Secured Overnight Financing Rate. Lenders with $680.0 million of commitments under the 2018 Credit Facility also exercised their option to extend the maturity of the 2018 Credit Facility from November 12, 2025 to November 11, 2026. The remaining $70.0 million of commitments under the 2018 Credit Facility will expire on November 13, 2024, unless extended by the applicable lender before such date.
16

Table of Contents
The 2018 Credit Facility has $750.0 million in aggregate availability with a maximum of $75.0 million available for use as letters of credit. As of March 31, 2022, there were no borrowings or letters of credit outstanding, leaving $750.0 million available to borrow under the 2018 Credit Facility. For a full description of the 2018 Credit Facility, see Note 7—Debt to the Consolidated Financial Statements in our 2021 Annual Report on Form 10-K.
As of March 31, 2022, we had four separate bi-lateral credit facilities with banks with an aggregate outstanding balance of $33.8 million.
As of March 31, 2022, we also had a $20.0 million unsecured standalone line of credit facility, for the purpose of obtaining the issuance of international letters of credit, bank guarantees, and performance bonds. Of the $20.0 million, $5.8 million of financial guarantees were outstanding as of March 31, 2022.
The applicable agreements for all unsecured debt contain additional terms, conditions and restrictions that we believe are usual and customary in unsecured debt arrangements for companies that are similar in size and credit quality.  At March 31, 2022, we were in compliance with all debt covenants.
NOTE 7 INCOME TAXES
We have historically calculated our provision for income taxes during interim reporting periods by applying the estimated annual effective tax rate for the full year to pre-tax income or loss, excluding discrete items, for the reporting period. We used a discrete effective tax rate method to calculate income taxes for the three and six months ended March 31, 2022. We determined that, since small changes in estimated "ordinary" income would result in significant changes in the estimated annual effective tax rate the historical annualized effective rate method would not provide a reliable estimate for the three and six months ended March 31, 2022. We anticipate utilizing the discrete effective tax rate method to calculate the provision for income taxes for the remainder of this fiscal year.
Our income tax provision (benefit) from continuing operations for the three months ended March 31, 2022 and 2021 was $2.7 million and $(36.6) million, respectively, resulting in effective tax rates of (136.9) percent and 22.9 percent, respectively. Our income tax (benefit) from continuing operations for the six months ended March 31, 2022 and 2021 was $(4.9) million and $(54.7) million, respectively, resulting in effective tax rates of 8.0 percent and 21.4 percent, respectively. Effective tax rates differ from the U.S. federal statutory rate of 21.0 percent for the three and six months ended March 31, 2022 primarily due to state and foreign income taxes and permanent non-deductible items. Additionally, the effective tax rate for the three months ended March 31, 2022 differs from the statutory rate due to the adjustments required to reflect the change in methodology to calculate the provision for income taxes as discussed above.
Effective tax rates differ from the U.S. federal statutory rate of 21.0 percent for the three and six months ended March 31, 2021 primarily due to state and foreign income taxes, permanent non-deductible items and discrete adjustments. Additionally, the effective tax rate for the three and six months ended March 31, 2021 includes a federal tax benefit arising from the ability to carryback the projected fiscal year 2021 federal net operating loss to a year when the statutory rate was 35.0 percent. The discrete adjustments for the six months ended March 31, 2021 is primarily due to tax expense related to equity compensation of $4.1 million.
For the next 12 months, we cannot predict with certainty whether we will achieve ultimate resolution of any uncertain tax positions associated with our U.S. and international operations that could result in increases or decreases of our unrecognized tax benefits. However, we do not expect these increases or decreases to have a material effect on our results of continuing operations or financial position.
NOTE 8 SHAREHOLDERS’ EQUITY
The Company has an evergreen authorization from the Board of Directors (the "Board") for the repurchase of up to four million common shares in any calendar year. The repurchases may be made using our cash and cash equivalents or other available sources. During the three and six months ended March 31, 2022, we repurchased 0.6 million and 3.2 million common shares at an aggregate cost of $16.6 million and $77.0 million, respectively, which are held as treasury shares. We had no repurchases of common shares during the six months ended March 31, 2021.
A cash dividend of $0.25 per share was declared on December 10, 2021 for shareholders of record on February 11, 2022, and was paid on February 28, 2022. An additional cash dividend of $0.25 per share was declared on March 2, 2022 for shareholders of record on May 13, 2022, payable on May 27, 2022. As a result, we recorded a dividend payable of $26.7 million within Dividends Payable on our Unaudited Condensed Consolidated Balance Sheets as of March 31, 2022.
17

Table of Contents
Accumulated Other Comprehensive Loss
Components of accumulated other comprehensive loss were as follows:
(in thousands)March 31,
2022
September 30,
2021
Pre-tax amounts:  
Unrecognized net actuarial loss$(25,254)$(26,268)
(25,254)(26,268)
After-tax amounts:
Unrecognized net actuarial loss(19,456)(20,244)
$(19,456)$(20,244)
The following is a summary of the changes in accumulated other comprehensive loss, net of tax, related to the defined benefit pension plan for the three and six months ended March 31, 2022:
(in thousands)Three Months Ended March 31, 2022Six Months Ended March 31, 2022
Balance at beginning of period$(19,850)$(20,244)
Activity during the period
Amounts reclassified from accumulated other comprehensive loss394 788 
Net current-period other comprehensive income394 788 
Balance at March 31, 2022$(19,456)$(19,456)
NOTE 9 REVENUE FROM CONTRACTS WITH CUSTOMERS
Drilling Services Revenue
The releases for rigs under term contracts result in early termination compensation owed to us, while releases for rigs under well-to-well contracts given outside the notification window provided for in the contract result in notification fees owed to us. During the three months ended March 31, 2022, we recognized $0.7 million in early termination revenue associated with term contracts compared to $1.9 million during the three months ended March 31, 2021. During the six months ended March 31, 2022, we also recognized $0.7 million in early termination revenue associated with term contracts compared to $7.7 million during the six months ended March 31, 2021.
With most drilling contracts, we also receive payments contractually designated for the mobilization and demobilization of drilling rigs and other equipment to and from the client’s drill site. Revenues associated with the mobilization and demobilization of our drilling rigs to and from the client’s drill site do not relate to a distinct good or service. These revenues are deferred and recognized ratably over the related contract term that drilling services are provided. For any contracts that include a provision for pooled term days at contract inception, followed by the assignment of days to specific rigs throughout the contract term, we have elected, as a practical expedient, to recognize revenue in the amount to which the entity has a right to invoice, as permitted by ASC 606.
On November 12, 2021, we settled a drilling contract dispute related to drilling services provided from fiscal years 2016 through 2019 with YPF S.A. (Argentina) ("YPF"). The settlement required that YPF make a one-time cash payment to H&P in the amount of $11.0 million and enter into drilling service contracts for three drilling rigs, each with multi-year terms. In addition, both parties were released of all outstanding claims against each other, and as a result, H&P recognized $5.4 million in revenue primarily due to accrued contingent liabilities for disputed amounts. Total revenue recognized as a result of the settlement in the amount of $16.4 million is included in Drilling Services Revenue within the International Solutions segment on our Unaudited Condensed Consolidated Statements of Operations for the six months ended March 31, 2022.
Contract Costs
We had capitalized fulfillment costs of $8.1 million and $4.3 million as of March 31, 2022 and September 30, 2021, respectively.
18

Table of Contents
Remaining Performance Obligations
The total aggregate transaction price allocated to the unsatisfied performance obligations, commonly referred to as backlog, as of March 31, 2022 was approximately $727.7 million, of which approximately $437.8 million is expected to be recognized during the remainder of fiscal year 2022, approximately $226.4 million during fiscal year 2023, and approximately $63.5 million during fiscal year 2024 and thereafter. These amounts do not include anticipated contract renewals. Additionally, contracts that currently contain month-to-month terms are represented in our backlog as one month of unsatisfied performance obligations. Our contracts are subject to cancellation or modification at the election of the customer, but also carry certain early termination provisions customers abide by in cases of cancellation or modification. Due to the level of capital deployed by our customers on underlying projects, we have not been materially adversely affected by contract cancellations or modifications in the past.
Contract Assets and Liabilities
The following tables summarize the balances of our contract assets (net of allowance for estimated credit losses) and liabilities at the dates indicated below:
(in thousands)March 31, 2022September 30, 2021
Contract assets, net$5,166 $4,513 
(in thousands)March 31, 2022
Contract liabilities balance at September 30, 2021
$9,286 
Payment received/accrued and deferred25,382 
Revenue recognized during the period(20,113)
Contract liabilities balance at March 31, 2022
$14,555 
NOTE 10 STOCK-BASED COMPENSATION
A summary of compensation cost for stock-based payment arrangements recognized in drilling services operating expense, research and development expense and selling, general and administrative expense on our Unaudited Condensed Consolidated Statements of Operations is as follows:
Three Months Ended March 31,Six Months Ended March 31,
(in thousands)2022202120222021
Stock-based compensation expense
Drilling services operating $1,282 $1,529 $2,522 $3,292 
Research and development393 271 746 607 
Selling, general and administrative6,270 5,026 10,895 10,378 
$7,945 $6,826 $14,163 $14,277 
Restricted Stock
A summary of the status of our restricted stock awards as of March 31, 2022 and changes in non-vested restricted stock outstanding during the six months then ended is presented below:
(in thousands, except per share amounts)
Shares (1)
Weighted Average Grant Date Fair Value per Share
Non-vested restricted stock outstanding at September 30, 2021
1,412 $37.36 
Granted744 25.83 
Vested (2)
(602)39.87 
Forfeited(38)31.51 
Non-vested restricted stock outstanding at March 31, 2022
1,516 $30.86 
(1)    Restricted stock shares include restricted phantom stock units under our Director Deferred Compensation Plan. These phantom stock units confer the economic benefits of owning company stock without the actual ownership, transfer or issuance of any shares. During the six months ended March 31, 2022, 14,199 restricted phantom stock units were granted and 18,906 restricted phantom stock units vested during the same period.
(2)    The number of restricted stock awards vested includes shares that we withheld on behalf of our employees to satisfy the statutory tax withholding requirements.
19

Table of Contents
Performance Units
A summary of the status of our performance-vested restricted share units ("performance units") as of March 31, 2022 and changes in non-vested performance units outstanding during the six months ended is presented below:
(in thousands, except per share amounts)Performance UnitsWeighted Average Grant Date Fair Value per Performance Unit
Non-vested performance units outstanding at September 30, 2021
699 $41.55 
Granted227 30.12 
Vested (2)
(161)62.66 
Dividend equivalent right performance units credited31.82 
Forfeited(46)35.11 
Non-vested performance units outstanding at March 31, 2022 (1)
726 $33.68 
(1)    Of the total non-vested performance units at the end of the period, specified performance criteria has been achieved with respect to 97,097 performance units which is calculated based on the payout percentage for the completed performance cycle. The vesting and number of the remainder of non-vested performance units reflected at the end of the period is contingent upon our achievement of specified target performance criteria. If we meet the specified maximum performance criteria, approximately 910,492 additional performance units could vest or become eligible to vest.
(2)    The number of performance units vested includes units that we withheld on behalf of our employees to satisfy the statutory tax withholding requirements.
Subject to the terms and conditions set forth in the applicable performance unit award agreements and the 2020 Plan, grants of performance units are subject to a vesting period of three years (the “Vesting Period”) that is dependent on the achievement of certain performance goals. Such performance unit grants consist of two separate components. Performance units that comprise the first component are subject to a three-year performance cycle. Performance units that comprise the second component are further divided into three separate tranches, each of which is subject to a separate one-year performance cycle within the full three-year performance cycle.  The vesting of the performance units is generally dependent on (i) the achievement of the Company’s total shareholder return (“TSR”) performance goals relative to the TSR achievement of a peer group of companies over the applicable performance cycle, and (ii) the continued employment of the recipient of the performance unit award throughout the Vesting Period. The Vesting Period for performance units granted in December 2018 ended on December 31, 2021 and the performance units earned were settled in shares of common stock during the three months ended March 31, 2022.
NOTE 11 EARNINGS (LOSSES) PER COMMON SHARE
ASC 260, Earnings per Share, requires companies to treat unvested share-based payment awards that have non-forfeitable rights to dividends or dividend equivalents as a separate class of securities in calculating earnings per share.  We have granted and expect to continue to grant to employees restricted stock grants that contain non-forfeitable rights to dividends. Such grants are considered participating securities under ASC 260.  As such, we are required to include these grants in the calculation of our basic earnings per share and calculate basic earnings per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings.
Basic earnings per share is computed utilizing the two-class method and is calculated based on the weighted-average number of common shares outstanding during the periods presented.
Diluted earnings per share is computed using the weighted-average number of common and common equivalent shares outstanding during the periods utilizing the two-class method for stock options, non-vested restricted stock and performance units.
Under the two-class method of calculating earnings per share, dividends paid and a portion of undistributed net income, but not losses, are allocated to unvested restricted stock grants that receive dividends, which are considered participating securities.
20

Table of Contents
The following table sets forth the computation of basic and diluted earnings (loss) per share:
Three Months Ended
March 31,
Six Months Ended
March 31,
(in thousands, except per share amounts)2022202120222021
Numerator:
Loss from continuing operations$(4,624)$(123,296)$(55,955)$(201,220)
Income (loss) from discontinued operations(352)2,293 (383)9,786 
Net loss(4,976)(121,003)(56,338)(191,434)
Adjustment for basic earnings (loss) per share
Earnings allocated to unvested shareholders(396)(354)(770)(714)
Numerator for basic earnings (loss) per share:
From continuing operations(5,020)(123,650)(56,725)(201,934)
From discontinued operations(352)2,293 (383)9,786 
(5,372)(121,357)(57,108)(192,148)
Numerator for diluted earnings (loss) per share:
From continuing operations(5,020)(123,650)(56,725)(201,934)
From discontinued operations(352)2,293 (383)9,786 
$(5,372)$(121,357)$(57,108)$(192,148)
Denominator:
Denominator for basic earnings (loss) per share - weighted-average shares105,393 107,861 106,494 107,738 
Effect of dilutive shares from stock options, restricted stock and performance units— — — — 
Denominator for diluted earnings (loss) per share - adjusted weighted-average shares105,393 107,861 106,494 107,738 
Basic earnings (loss) per common share:
Loss from continuing operations$(0.05)$(1.15)$(0.53)$(1.87)
Income from discontinued operations— 0.02 — 0.09 
Net loss$(0.05)$(1.13)$(0.53)$(1.78)
Diluted earnings (loss) per common share:
Loss from continuing operations$(0.05)$(1.15)$(0.53)$(1.87)
Income from discontinued operations— 0.02 — 0.09 
Net loss$(0.05)$(1.13)$(0.53)$(1.78)
We had a net loss for all periods presented above. Accordingly, our diluted loss per share calculation was equivalent to our basic loss per share calculation since diluted loss per share excluded any assumed exercise of equity awards. These were excluded because they were deemed to be anti-dilutive, meaning their inclusion would have reduced the reported net loss per share in the applicable period.
The following potentially dilutive average shares attributable to outstanding equity awards were excluded from the calculation of diluted earnings (loss) per share because their inclusion would have been anti-dilutive:
 Three Months Ended
March 31,
Six Months Ended
March 31,
 (in thousands, except per share amounts)
2022202120222021
Potentially dilutive shares excluded as anti-dilutive2,6753,9202,8564,146
Weighted-average price per share$60.26 $57.15 $59.58 $56.79 
21

Table of Contents
NOTE 12 FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
We have certain assets and liabilities that are required to be measured and disclosed at fair value. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date.  We use the fair value hierarchy established in ASC 820-10 to measure fair value to prioritize the inputs:
Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
Level 2 — Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets; quoted prices for similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.  This includes pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.
Recurring Fair Value Measurements
The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis and indicate the level in the fair value hierarchy in which we classify the fair value measurement.
March 31, 2022
(in thousands)Fair ValueLevel 1Level 2Level 3
Assets    
Short-term investments: 
Corporate debt securities$141,655 $— $141,655 $— 
U.S. government and federal agency securities6,722 6,722 — — 
Total short-term investments148,377 6,722 141,655 — 
Investments:
Non-qualified supplemental savings plan17,710 17,710 — — 
Equity and debt securities22,812 19,312 — 3,500 
Equity investment in ADNOC Drilling164,783 164,783 — — 
Total investments205,305 201,805 — 3,500 
Liabilities
Contingent consideration$2,996 $— $— $2,996 
September 30, 2021
(in thousands)Fair ValueLevel 1Level 2Level 3
Assets    
Short-term investments:    
Corporate debt securities$192,950 $— $192,950 $— 
U.S. government and federal agency securities5,750 5,750 — — 
Total short-term investments198,700 5,750 192,950 — 
Investments:
Non-qualified supplemental savings plan18,221 18,221 — — 
Equity and debt securities14,358 13,858 — 500 
Cornerstone investment in ADNOC Drilling100,000 100,000 — — 
Total investments132,579 132,079 — 500 
Liabilities
Contingent consideration$2,996 $— $— $2,996 
22

Table of Contents
Short-term investments include securities classified as trading securities. Both realized and unrealized gains and losses on trading securities are included in other income (expense) in the Unaudited Condensed Consolidated Statements of Operations. The securities are recorded at fair value. Level 1 inputs include U.S. agency issued debt securities with active markets and money market funds. For these items, quoted current market prices are readily available. Level 2 inputs included corporate bonds measured using broker quotations that utilize observable market inputs.
Our long-term investments include debt and equity securities and assets held in a Non-Qualified Supplemental Savings Plan ("Savings Plan"). Our assets that we hold in the Savings Plan are comprised of mutual funds that are measured using Level 1 inputs. Additionally we hold equity securities in Schlumberger, Ltd., which is classified as Level 1 and based on the quoted stock price. Our long-term debt securities are classified as available-for-sale and considered a Level 3 input based on the absence of market activity.
During September 2021, the Company made a $100.0 million cornerstone investment in ADNOC Drilling in advance of its announced IPO, representing 159.7 million shares of ADNOC Drilling, equivalent to a one percent ownership stake and subject to a three-year lockup period. ADNOC Drilling's IPO was completed on October 3, 2021, and its shares are listed and traded on the Abu Dhabi Securities Exchange (ADX). Our investment is classified as a long-term equity investment within Investments in our Unaudited Condensed Consolidated Balance Sheets. We have applied the guidance in Topic 820, Fair Value Measurement, in the initial accounting of the transaction and the subsequent revaluation of the investment balance, concluding that a contractual restriction on the sale of an equity security that is publicly traded is not considered in measuring fair value. During the three and six months ended March 31, 2022, we recognized a gain of $16.7 million and $64.5 million, respectively, in our Unaudited Condensed Consolidated Statement of Operations. As of March 31, 2022, this investment is classified as a Level 1 investment and based on the quoted stock price on the Abu Dhabi Securities Exchange, without applying a discount factor.
Our financial liabilities measured using Level 3 unobservable inputs primarily consist of potential earnout payments associated with our business acquisitions in fiscal year 2019. The contingent considerations are recorded in Accrued Liabilities and Other Noncurrent Liabilities in the Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the milestone achievement. The following table reconciles changes in the fair value for the periods presented below:
Three Months Ended
March 31,
Six Months Ended
March 31,
(in thousands)2022202120222021
Liabilities at beginning of period$3,096 $8,973 $2,996 $9,123 
Additions— — 500 — 
Total gains or losses:
Included in earnings(100)— (250)100 
Settlements 1
— — (250)(250)
Liabilities at end of period$2,996 $8,973 $2,996 $8,973 
(1)Settlements represent earnout payments that have been paid or earned during the period.
Nonrecurring Fair Value Measurements
We have certain assets that are subject to measurement at fair value on a nonrecurring basis. For these nonfinancial assets, measurement at fair value in periods subsequent to their initial recognition is applicable if they are determined to be impaired. These assets generally include assets held-for-sale, property, plant and equipment, goodwill, intangible assets, and operating lease right-of-use assets. If measured at fair value in the Unaudited Condensed Consolidated Balance Sheets, these would generally be classified within Level 2 or 3 of the fair value hierarchy. Further details on any changes in valuation of these assets is provided in their respective footnotes.
We also hold various other equity securities without readily determinable fair values. These equity securities are measured at cost, less any impairments on a nonrecurring basis. During the three and six months ended March 31, 2022, we did not have any impairments on these investments.
The following table reconciles changes in the balance our equity securities, without readily determinable fair values, that are classified as Level 3 for the periods presented below:
Three Months Ended
March 31,
Six Months Ended
March 31,
(in thousands)2022202120222021
Assets at beginning of period$8,881 $1,000 $2,865 $— 
Purchases5,109 — 11,125 1,000 
Assets at end of period$13,990 $1,000 $13,990 $1,000 
23

Table of Contents
As of March 31, 2022 and September 30, 2021 the aggregate balance of our debt and equity security investments in geothermal energy was $16.9 million and $2.7 million, respectively. These investments include assets measured on both a recurring and nonrecurring basis.
Other Financial Instruments
The carrying amount of cash and cash equivalents and restricted cash approximates fair value due to the short-term nature of these items. The majority of cash equivalents are invested in highly liquid money-market mutual funds invested primarily in direct or indirect obligations of the U.S. Government and in federally insured deposit accounts. The carrying value of accounts receivables, other current and noncurrent assets, accounts payable, accrued liabilities and other liabilities approximated fair value at March 31, 2022 and September 30, 2021.
The following information presents the supplemental fair value information about current and long-term fixed-rate debt at March 31, 2022 and September 30, 2021:
(in millions)
March 31, 2022
September 30, 2021
Current portion of long-term debt, net1
Carrying value$— $483.5 
Fair value— 541.6 
Long-term debt, net
Carrying value542.0 542.0 
Fair value506.9 554.3 
(1)On October 27, 2021 we redeemed the outstanding 2025 Notes. See Note 6—Debt to our Consolidated Financial Statements
The fair values of the current and long-term fixed-rate debt is based on broker quotes as of March 31, 2022 and September 30, 2021.  The notes are classified within Level 2 of the fair value hierarchy as they are not actively traded in markets.
NOTE 13 COMMITMENTS AND CONTINGENCIES
Purchase Commitments
Equipment, parts and supplies are ordered in advance to promote efficient construction and capital improvement progress. At March 31, 2022, we had purchase commitments for equipment, parts and supplies of approximately $79.6 million.
Guarantee Arrangements
We are contingently liable to sureties in respect of bonds issued by the sureties in connection with certain commitments entered into by us in the normal course of business.  We have agreed to indemnify the sureties for any payments made by them in respect of such bonds.
Contingencies
During the ordinary course of our business, contingencies arise resulting from an existing condition, situation or set of circumstances involving an uncertainty as to the realization of a possible gain or loss contingency.  We account for gain contingencies in accordance with the provisions of ASC 450, Contingencies, and, therefore, we do not record gain contingencies or recognize income until realized.  The property and equipment of our Venezuelan subsidiary was seized by the Venezuelan government on June 30, 2010.  Our wholly-owned subsidiaries, Helmerich & Payne International Drilling Co. ("HPIDC") and Helmerich & Payne de Venezuela, C.A., filed a lawsuit in the United States District Court for the District of Columbia on September 23, 2011 against the Bolivarian Republic of Venezuela, Petroleos de Venezuela, S.A. and PDVSA Petroleo, S.A., seeking damages for the taking of their Venezuelan drilling business in violation of international law and for breach of contract.  While there exists the possibility of realizing a recovery, we are currently unable to determine the timing or amounts we may receive, if any, or the likelihood of recovery. 
24

Table of Contents
In May 2018, an employee of our subsidiary, HPIDC, was involved in a car accident in his personal vehicle while not clocked in for work. The accident resulted in a fatality of a passenger in the other vehicle. The estate of the victim, his widow and children subsequently brought a lawsuit against the employee and HPIDC in Texas State District Court in January 2020. In February 2022, trial began in the matter and the jury reached a verdict against HPIDC and our employee for approximately $126.0 million, including interest. In March 2022, the court entered a judgment consistent with the findings of the jury. In April 2022, the Company and its insurers filed post-trial motions and if unsuccessful, the Company and its insurers plan to appeal the judgment. Accordingly, the Company cannot make an estimate of the possible loss at this time. As of March 31, 2022, we have accrued a total of $3.0 million, and currently have incurred some expense, mainly legal fees, against the deductible. However, as our insurance carriers are responsible for amounts over our insurance deductible up to a coverage amount, we believe any foreseeable exposure to the Company at this time above the $3.0 million will be paid for by insurance recoveries. Accordingly, we do not believe it is reasonably possible that our exposure will exceed our insurance coverage amount.
The Company and its subsidiaries are parties to various other pending legal actions arising in the ordinary course of our business. We maintain insurance against certain business risks subject to certain deductibles.  Although no assurance can be given, we believe, based on our experiences to date and taking into account established reserves and insurance, that the ultimate resolution of such items will not have a material adverse impact on our financial condition, cash flows, or results of operations. When we determine a loss is probable of occurring and is reasonably estimable, we accrue an undiscounted liability for such contingencies based on our best estimate using information available at that time.  If the estimated loss is a range of potential outcomes and there is no better estimate within the range, we accrue the amount at the low end of the range.  We disclose contingencies where an adverse outcome may be material, or in the judgment of management, we conclude the matter should otherwise be disclosed.
NOTE 14 BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION
Description of the Business
We are a performance-driven drilling solutions and technologies company based in Tulsa, Oklahoma with operations in all major U.S. onshore oil and gas producing basins as well as South America and the Middle East. Our drilling operations consist mainly of contracting Company-owned drilling equipment primarily to large oil and gas exploration companies.  We believe we are the recognized industry leader in drilling as well as technological innovation. We focus on offering our customers an integrated solutions-based approach by combining proprietary rig technology, automation software, and digital expertise into our rig operations rather than a product-based offering, such as a rig or separate technology package. Our drilling services operations are organized into the following reportable operating business segments: North America Solutions, Offshore Gulf of Mexico and International Solutions. 
Each reportable operating segment is a strategic business unit that is managed separately, and consolidated revenues and expenses reflect the elimination of all material intercompany transactions. Our real estate operations, our incubator program for new research and development projects, and our wholly-owned captive insurance companies are included in "Other." External revenues included in “Other” primarily consist of rental income.
Segment Performance
We evaluate segment performance based on income or loss from continuing operations (segment operating income (loss)) before income taxes which includes:
Revenues from external and internal customers
Direct operating costs
Depreciation and amortization
Allocated general and administrative costs
Asset impairment charges
Restructuring charges
but excludes gain on reimbursement of drilling equipment, other (gain) loss on sale of assets, corporate selling, general and administrative costs, corporate depreciation, and corporate restructuring charges.
General and administrative costs are allocated to the segments based primarily on specific identification and, to the extent that such identification is not practical, other methods may be used which we believe to be a reasonable reflection of the utilization of services provided.
25

Table of Contents
Summarized financial information of our reportable segments for the three and six months ended March 31, 2022 and 2021 is shown in the following tables:
Three Months Ended March 31, 2022
(in thousands)North America SolutionsOffshore Gulf of MexicoInternational SolutionsOtherEliminationsTotal
External sales$408,814 $29,147 $27,422 $2,214 $— $467,597 
Intersegment— — — 13,204 (13,204)— 
Total sales408,814 29,147 27,422 15,418 (13,204)467,597 
Segment operating income (loss)1,297 5,278 (848)3,167 (2,031)6,863 
Three Months Ended March 31, 2021
(in thousands)North America SolutionsOffshore Gulf of MexicoInternational SolutionsOtherEliminationsTotal
External sales$249,939 $29,274 $14,813 $2,145 $— $296,171 
Intersegment— — — 8,680 (8,680)— 
Total sales249,939 29,274 14,813 10,825 (8,680)296,171 
Segment operating income (loss)(109,834)2,978 (3,458)(1,072)(3,433)(114,819)
Six Months Ended March 31, 2022
(in thousands)North America SolutionsOffshore Gulf of MexicoInternational SolutionsOtherEliminationsTotal
External sales$749,848 $58,461 $64,581 $4,489 $— $877,379 
Intersegment— — — 26,852 (26,852)— 
Total sales749,848 58,461 64,581 31,341 (26,852)877,379 
Segment operating income (loss)(27,596)10,744 7,201 7,096 (3,313)(5,868)
Six Months Ended March 31, 2021
(in thousands)North America SolutionsOffshore Gulf of MexicoInternational SolutionsOtherEliminationsTotal
External sales$451,929 $61,547 $25,331 $3,741 $— $542,548 
Intersegment— — — 15,802 (15,802)— 
Total sales451,929 61,547 25,331 19,543 (15,802)542,548 
Segment operating income (loss)(182,762)5,720 (11,815)3,039 (5,559)(191,377)
26

Table of Contents
The following table reconciles segment operating income (loss) per the tables above to loss from continuing operations before income taxes as reported on the Unaudited Condensed Consolidated Statements of Operations:
Three Months Ended March 31,Six Months Ended March 31,
(in thousands)2022202120222021
Segment operating income (loss)$6,863 $(114,819)$(5,868)$(191,377)
Gain on reimbursement of drilling equipment6,448 3,748 11,702 5,939 
Other gain (loss) on sale of assets716 (22,263)(313)(12,118)
Corporate selling, general and administrative costs, corporate depreciation, and corporate restructuring charges(36,644)(27,589)(70,749)(56,590)
Operating loss from continuing operations(22,617)(160,923)(65,228)(254,146)
Other income (expense)
Interest and dividend income3,399 4,819 5,988 6,698 
Interest expense(4,390)(5,759)(10,504)(11,898)
Gain on investment securities22,132 2,520 69,994 5,444 
Loss on extinguishment of debt— — (60,083)— 
Other(476)(577)(1,018)(2,057)
Total unallocated amounts20,665 1,003 4,377 (1,813)
Loss from continuing operations before income taxes$(1,952)$(159,920)$(60,851)$(255,959)
The following table reconciles segment total assets as reported on the Unaudited Condensed Consolidated Balance Sheets:
(in thousands)March 31,
2022
September 30,
2021
Total assets 1
North America Solutions$3,365,225 $3,418,569 
Offshore Gulf of Mexico81,575 84,580 
International Solutions386,832 269,820 
Other105,630 95,398 
3,939,262 3,868,367 
Investments and corporate operations395,088 1,165,761 
$4,334,350 $5,034,128 
(1)Assets by segment exclude investments in subsidiaries and intersegment activity.

The following table presents revenues from external customers by country based on the location of service provided:
Three Months Ended March 31,Six Months Ended March 31,
(in thousands)2022202120222021
Operating revenues
United States$439,793 $280,757 $811,282 $516,201 
Argentina15,450 6,979 44,601 8,532 
Bahrain4,826 6,921 12,459 14,470 
United Arab Emirates1,524 — 1,524 990 
Colombia5,622 946 5,997 1,375 
Other Foreign382 568 1,516 980 
Total$467,597 $296,171 $877,379 $542,548 
Refer to Note 9—Revenue from Contracts with Customers for additional information regarding the recognition of revenue.
NOTE 15 SUBSEQUENT EVENTS
During April 2022, the Company made a $33.0 million cornerstone investment in an affiliate of Galileo Technologies ("Galileo") in the form of a convertible note. Galileo is a world leader in natural gas compression and re-gasification modular systems and technologies. The company creates and manufactures innovative products providing cost-effective solutions for its customers. The convertible note bears interest at 5% per annum and matures on April 2027. If the conversion option is exercised, the note would convert into common shares of Galileo.
27

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10‑Q (“Form 10‑Q”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included in this Form 10-Q, including without limitation, statements regarding our future financial position, business strategy, budgets, projected costs and plans, objectives of management for future operations, contract terms, financing and funding, and the ongoing effect of the COVID-19 pandemic and actions we or others may take in response to the COVID-19 pandemic are forward-looking statements. In addition, forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “predict,” “project,” “target,” “continue,” or the negative thereof or similar terminology. Forward-looking statements are based upon current plans, estimates, and expectations that are subject to risks, uncertainties, and assumptions. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Actual results may vary materially from those indicated or anticipated by such forward-looking statements. The inclusion of such statements should not be regarded as a representation that such plans, estimates, or expectations will be achieved.
These forward-looking statements include, among others, information concerning our possible or assumed future results of operations and statements about the following such as:
our business strategy;
estimates of our revenues, income, earnings per share, and market share;
our capital structure and our ability to return cash to stockholders through dividends or share repurchases;
the amount and nature of our future capital expenditures and how we expect to fund our capital expenditures;
the volatility of future oil and natural gas prices;
the effects of actions by, or disputes among or between, members of the Organization of Petroleum Exporting Countries ("OPEC") and other oil producing nations (together, "OPEC+") with respect to production levels or other matters related to the prices of oil and natural gas;
changes in future levels of drilling activity and capital expenditures by our customers, whether as a result of global capital markets and liquidity, changes in prices of oil and natural gas or otherwise, which may cause us to idle or stack additional rigs, or increase our capital expenditures and the construction or acquisition of rigs;
the ongoing effect, impact, potential duration or other implications of the novel strain of coronavirus ("COVID-19") pandemic, including any variants of the virus, and the effectiveness of vaccines and distribution of vaccines to treat the virus, any reinstatement of governmental-imposed restrictions, and the pace of the economic recovery and any expectations we may have with respect thereto;
changes in worldwide rig supply and demand, competition, or technology;
possible cancellation, suspension, renegotiation or termination (with or without cause) of our contracts as a result of general or industry-specific economic conditions, mechanical difficulties, performance or other reasons;
expansion and growth of our business and operations;
our belief that the final outcome of our legal proceedings will not materially affect our financial results;
impact of federal and state legislative and regulatory actions and policies affecting our costs and increasing operation restrictions or delay and other adverse impacts on our business;
impact of geopolitical developments and tensions, war and uncertainty in oil-producing countries (including the invasion of Ukraine by Russia and any related political or economic responses and counter-responses or otherwise by various global actors or the general effect on the global economy);
28

Table of Contents
environmental or other liabilities, risks, damages or losses, whether related to storms or hurricanes (including wreckage or debris removal), collisions, grounding, blowouts, fires, explosions, other accidents, terrorism or otherwise, for which insurance coverage and contractual indemnities may be insufficient, unenforceable or otherwise unavailable;
our financial condition and liquidity;
tax matters, including our effective tax rates, tax positions, results of audits, changes in tax laws, treaties and regulations, tax assessments and liabilities for taxes;
the occurrence of cybersecurity incidents, attacks or other breaches to our information technology systems;
potential impacts on our business resulting from climate change, greenhouse gas regulations, and the impact of climate change-related changes in the frequency and severity of weather patterns;
potential long-lived asset impairments; and
our sustainability strategy, including expectations, plans, or goals related to corporate responsibility, sustainability and environmental matters, and any related reputational risks as a result of execution of this strategy.
Important factors that could cause actual results to differ materially from our expectations or results discussed in the forward‑looking statements are disclosed in our 2021 Annual Report on Form 10-K under Item 1A— “Risk Factors,” and Item 7— “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” All subsequent written and oral forward‑looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by such cautionary statements. Because of the underlying risks and uncertainties, we caution you against placing undue reliance on these forward-looking statements. We assume no duty to update or revise these forward‑looking statements based on changes in internal estimates, expectations or otherwise, except as required by law.
Executive Summary
Helmerich & Payne, Inc. (“H&P,” which, together with its subsidiaries, is identified as the “Company,” “we,” “us,” or “our,” except where stated or the context requires otherwise) through its operating subsidiaries provides performance-driven drilling solutions and technologies that are intended to make hydrocarbon recovery safer and more economical for oil and gas exploration and production companies. As of March 31, 2022, our drilling rig fleet included a total of 271 drilling rigs. Our reportable operating business segments consist of the North America Solutions segment with 236 rigs, the Offshore Gulf of Mexico segment with seven offshore platform rigs and the International Solutions segment with 28 rigs as of March 31, 2022. At the close of the second quarter of fiscal year 2022, we had 181 contracted rigs, of which 106 were under a fixed-term contract and 75 were working well-to-well, compared to 137 contracted rigs at September 30, 2021. Our long-term strategy remains focused on innovation, technology, safety, operational excellence and reliability. As we move forward, we believe that our advanced uniform rig fleet, technology offerings, financial strength, contract backlog and strong customer and employee base position us very well to respond to continued cyclical and often times volatile market conditions and take advantage of future opportunities.
Market Outlook
Our revenues are primarily derived from the capital expenditures of companies involved in the exploration, development and production of crude oil and natural gas (“E&Ps”). Generally, the level of capital expenditures is dictated by current and expected future prices of crude oil and natural gas, which are determined by improving supply and demand factors. Both commodities have historically been, and we expect them to continue to be, cyclical and highly volatile.
Our drilling services operations are organized into the following reportable operating segments: North America Solutions, Offshore Gulf of Mexico, and International Solutions. With respect to North America Solutions, the resurgence of oil and natural gas production coming from the United States brought about by unconventional shale drilling for oil has significantly impacted the supply of oil and natural gas and the type of rig utilized in the U.S. land drilling industry. The advent of unconventional drilling for oil in the United States began in early 2009 and continues to evolve as E&Ps drill longer lateral wells with tighter well spacing. During this time, we designed, built and delivered to the market new technology AC drive rigs (FlexRig®), substantially growing our fleet. The pace of progress of unconventional drilling over the years has been cyclical and volatile, dictated by crude oil and natural gas price fluctuations.
29

Table of Contents
Throughout this time, the length of the lateral section of wells drilled in the United States has continued to grow. The progression of longer lateral wells has required many of the industry’s rigs to be upgraded to certain specifications in order to meet the technical challenges of drilling longer lateral wells. The upgraded rigs meeting those specifications are commonly referred to in the industry as super-spec rigs and have the following specific characteristics: AC drive, minimum of 1,500 horsepower drawworks, minimum of 750,000 lbs. hookload rating, 7,500 psi mud circulating system, and multiple-well pad capability.
The technical requirements of drilling longer lateral wells often necessitate the use of super-spec rigs and even when not required for shorter lateral wells, there is a strong customer preference for super-spec due to the drilling efficiencies gained in utilizing a super-spec rig. As a result, there has been a structural decline in the use of non-super-spec rigs across the industry. However, because we have a large super-spec fleet, we gained market share and became the largest provider of super-spec rigs in the industry. Accordingly, we believe we are well positioned to respond to various market conditions.
In early March 2020, the increase in crude oil supply resulting from production escalations from OPEC+ combined with a decrease in crude oil demand stemming from the global response and uncertainties surrounding the COVID-19 pandemic resulted in a sharp decline in crude oil prices. Specifically, during calendar year 2020, crude oil prices fell from approximately $60 per barrel to the low-to-mid-$20 per barrel range, lower in some cases, which resulted in customers decreasing their 2020 capital budgets nearly 50 percent from calendar year 2019 levels. There was a corresponding dramatic decline in the demand for land rigs, such that the overall rig count for calendar year 2020 averaged roughly 430 rigs, significantly lower than in calendar year 2019, which averaged approximately 940 rigs.
Crude oil prices stabilized during the back half of calendar 2020 and were in the $40 to $50 per barrel range as customers set their capital budgets for calendar year 2021. During calendar 2021 crude oil prices continued to increase, reaching more than $70 per barrel. However, as expected, rig activity did not move in tandem with crude oil prices to the same extent it had historically as a large portion of our customers have a more disciplined approach to their operations and capital spending in order to enhance their own financial returns.
The capital budgets for calendar year 2022 established by our customers were done so in a higher crude oil price environment compared to the prior year, which suggests a higher level of capital spending and activity in calendar year 2022 compared to calendar year 2021. Additionally, higher commodity prices have allowed customers to strengthen their balance sheets following the 2020 downturn freeing up additional funds for investment. More recently the invasion of Ukraine by Russia caused crude oil prices to spike well above $100 per barrel. However, as we have experienced in recent years, our customers have maintained a disciplined approach to their operations and kept capital spending levels as originally planned. We have noted no material reaction in customer behavior resulting from the spike in crude oil prices.
In the U.S., the demand for super-spec rigs continues to strengthen following higher capital spending by E&Ps in both calendar year 2021 and year to date 2022. While there is still idle super-spec rig capacity in the market, much of that idle capacity represents rigs that have not been active during the preceding two years and in some cases even longer. Consequently, there are additional costs that would be incurred to bring those long-idled rigs back into working condition, which has resulted in upward pricing for super-spec rigs. This supply-demand dynamic combined with the value proposition we provide our customers through our drilling expertise, high-quality FlexRig fleet, and automation technology has resulted in an improvement in our underlying contract economics. We believe these improvements will become more apparent in the coming quarters as an increasing amount of our active rigs are re-priced at higher rates.
Our North America Solutions active rig count has more than tripled from 47 rigs in August 2020 to 171 rigs at March 31, 2022. To date, our fiscal 2022 rig count increases appear to mirror those of 2021 with 27 rigs added during the first quarter and 17 rigs added during the second quarter of fiscal 2022 compared to 25 rigs and 15 rigs added for the same fiscal quarters in the prior year, respectively. Considering the Company's disciplined approach to deploying capital, maintaining our fiscal year 2022 capital budget of $250 to $270 million, and given the current market dynamics, we expect our active count to grow at a much more muted pace during the remaining quarters in fiscal year 2022.
Collectively, our other business segments, Offshore Gulf of Mexico and International Solutions, are exposed to the same macro commodity price environment affecting our North America Solutions segment; however, activity levels in the International Solutions segment are also subject to other various geopolitical and financial factors specific to the countries of our operations. While we do not expect much change in our Offshore Gulf of Mexico segment, we see opportunities for improvement in our International Solutions segment, but those will likely occur on a more extended timeline compared to what we have experienced in the North America Solutions segment.
30

Table of Contents
From a financial perspective, we believe the Company is well positioned to manage through events, even protracted ones, that may result from market disruptions and the related commodity price volatility. More recent events, like the COVID-19 global pandemic and the Russian invasion of Ukraine, have elevated commodity price volatility and have other far reaching global market ramifications. The direct impacts of the COVID-19 pandemic on the Company have diminished significantly as health guidelines and restrictions have eased in most jurisdictions in which we operate. Since the COVID-19 outbreak began, no rigs have been fully shut down (other than temporary shutdowns for disinfecting and the suspension for a certain period of time on one of our international rigs) and these temporary shutdowns did not have a significant impact on service. Recently, the conflict between the Russian Federation and Ukraine, and the international and social sanctions in reaction to the conflict have resulted in an increase in commodity price volatility. The Company does not have any operations in the Russia Federation, Ukraine or adjacent regions and therefore our rig activity levels are not directly impacted by this conflict. While we do not have supplies originating in these countries, the conflict may create some inflationary pressures within our supply chain.
Recent Developments
Investments in Geothermal Energy
During the six months ended March 31, 2022, we made an additional $14.1 million in geothermal energy investments consisting of both debt and equity securities. Investments were made in four separate companies that are pursuing technological concepts to make unconventional geothermal energy a viable economic renewable energy source. These companies are developing an enhanced geothermal system ("EGS") and closed loop concepts. The EGS concept uses horizontal drilling, induced permeability, and fiber optic sensing. The closed loop concepts use multilateral wellbores, propriety working fluid, or coaxial pipe configurations. All of these concepts are designed to harvest geothermal heat to create carbon-free, baseload energy. Our aggregate balance of investments in geothermal energy companies was $16.9 million at March 31, 2022.
Investment in ADNOC Drilling
During September 2021, the Company made a $100.0 million cornerstone investment in ADNOC Drilling in advance of its announced IPO, representing 159.7 million shares of ADNOC Drilling, equivalent to a one percent ownership stake and subject to a three-year lockup period. ADNOC Drilling's IPO was completed on October 3, 2021, and its shares are listed and traded on the Abu Dhabi Securities Exchange (ADX). Our investment is classified as a long-term equity investment within Investments in our Unaudited Condensed Consolidated Balance Sheets. We have applied the guidance in Topic 820, Fair Value Measurement, in the initial accounting of the transaction and the subsequent revaluation of the investment balance, concluding that a contractual restriction on the sale of an equity security that is publicly traded is not considered in measuring fair value. During the three and six months ended March 31, 2022, we recognized a gain of $16.7 million and $64.5 million, respectively, in our Unaudited Condensed Consolidated Statement of Operations. As of March 31, 2022, this investment is classified as a Level 1 investment and based on the quoted stock price on the Abu Dhabi Securities Exchange, without applying a discount factor.
Investment in Galileo Technologies
During April 2022, the Company made a $33.0 million cornerstone investment in an affiliate of Galileo Technologies ("Galileo") in the form of a convertible note. The convertible note bears interest at 5% per annum and matures on April 2027. If the conversion option is exercised, the note would convert into common shares of Galileo. One of our Directors is an independent director of Galileo. This Director does not have a direct or indirect material interest in the transaction and was not involved in the negotiations or any approvals related to the transaction.
Contract Backlog
As of March 31, 2022 and September 30, 2021, our contract drilling backlog, being the expected future dayrate revenue from executed contracts, was $727.7 million and $572.0 million, respectively. These amounts do not include anticipated contract renewals or expected performance bonuses. The increase in backlog at March 31, 2022 from September 30, 2021 is primarily due to an increase in the number of fixed term drilling contracts executed. Approximately 39.8 percent of the March 31, 2022 total backlog is reasonably expected to be fulfilled in fiscal year 2023 and thereafter.
31

Table of Contents
The following table sets forth the total backlog by reportable segment as of March 31, 2022 and September 30, 2021, and the percentage of the March 31, 2022 backlog reasonably expected to be fulfilled in fiscal year 2023 and thereafter:
(in millions)March 31, 2022September 30, 2021Percentage Reasonably Expected to be Filled in Fiscal Year 2023 and Thereafter
North America Solutions$534.2 $429.6 29.7 %
Offshore Gulf of Mexico9.8 17.2 — 
International Solutions183.7 125.2 71.5 
 $727.7 $572.0