NABORS INDUSTRIES LTD [NBR] Filings

10-Q 1 nbr-20240630x10q.htm 10-Q

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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 the Quarterly Period Ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-32657

NABORS INDUSTRIES LTD.

(Exact name of registrant as specified in its charter)


Bermuda		98-0363970
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Crown House

Second Floor

4 Par-la-Ville Road

Hamilton, HM08

Bermuda

(Address of principal executive office)

(441) 292-1510

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common shares, $.05 par value per share	NBR	NYSE

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 (Section 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 Filer ☒		Accelerated 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 ☒

The number of common shares, par value $.05 per share, outstanding as of July 24, 2024 was 9,548,615, excluding 1,161,283 common shares held by our subsidiaries, or 10,709,898 in the aggregate.

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

Index


PART I FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	3

	Condensed Consolidated Statements of Income (Loss) for the Three and Six Months Ended June 30, 2024 and 2023	4

	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2024 and 2023	5

	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	6

	Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2024 and 2023	7

	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33

Item 4.	Controls and Procedures	33

PART II OTHER INFORMATION

Item 1.	Legal Proceedings	34

Item 1A.	Risk Factors	34

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3.	Defaults Upon Senior Securities	34

Item 4.	Mine Safety Disclosures	35

Item 5.	Other Information	35

Item 6.	Exhibits	35

Signatures		35

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


	June 30,		December 31,
	2024		2023

	(In thousands, except for
	share amounts)
ASSETS
Current assets:
Cash and cash equivalents	$	465,953	$	1,057,487
Short-term investments		7,655		12,691
Accounts receivable, net of allowance of $52,737 and $52,864, respectively		368,550		347,837
Inventory, net		147,751		147,798
Other current assets		87,881		79,865
Total current assets		1,077,790		1,645,678
Property, plant and equipment, net		2,813,148		2,898,728
Restricted cash held in trust		323,262		315,488
Deferred income taxes		227,025		238,871
Other long-term assets		174,468		179,200
Total assets (1)	$	4,615,693	$	5,277,965
LIABILITIES AND EQUITY
Current liabilities:
Current portion of debt	$	—	$	629,621
Trade accounts payable		331,468		294,442
Accrued liabilities		211,400		230,240
Income taxes payable		42,306		54,255
Current lease liabilities		5,748		5,423
Total current liabilities		590,922		1,213,981
Long-term debt		2,514,169		2,511,519
Other long-term liabilities		246,031		270,014
Deferred income taxes		1,556		1,366
Total liabilities (1)		3,352,678		3,996,880
Commitments and contingencies (Note 8)
Redeemable noncontrolling interest in subsidiary		761,415		739,075

Shareholders’ equity:
Common shares, par value $0.05 per share:
Authorized common shares 32,000; issued 10,711 and 10,556, respectively		535		527
Capital in excess of par value		3,543,986		3,538,896
Accumulated other comprehensive income (loss)		(10,932)		(10,832)
Retained earnings (accumulated deficit)		(1,967,467)		(1,886,226)
Less: treasury shares, at cost, 1,161 and 1,161 common shares, respectively		(1,315,751)		(1,315,751)
Total shareholders’ equity		250,371		326,614
Noncontrolling interest		251,229		215,396
Total equity		501,600		542,010
Total liabilities and equity	$	4,615,693	$	5,277,965

(1)	The condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023 include assets and liabilities of variable interest entities. See Note 3—Joint Ventures and Note 13—Special Purpose Acquisition Company for additional information.

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(Unaudited)


		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2024		2023		2024		2023

	(In thousands, except per share amounts)
Revenues and other income:
Operating revenues		$	734,798	$	767,067	$	1,468,502	$	1,546,206
Investment income (loss)			8,181		11,743		18,382		21,609
Total revenues and other income			742,979		778,810		1,486,884		1,567,815

Costs and other deductions:
Direct costs			440,225		455,531		877,302		917,860
General and administrative expenses			62,154		63,232		123,905		124,962
Research and engineering			14,362		13,281		28,225		28,355
Depreciation and amortization			160,141		159,698		317,826		322,729
Interest expense			51,493		46,164		101,872		91,305
Other, net			12,079		(1,775)		28,187		(44,150)
Total costs and other deductions			740,454		736,131		1,477,317		1,441,061
Income (loss) before income taxes			2,525		42,679		9,567		126,754
Income tax expense (benefit):
Current			10,691		19,026		20,359		37,328
Deferred			4,863		7,422		11,239		12,135
Total income tax expense (benefit)			15,554		26,448		31,598		49,463
Net income (loss)			(13,029)		16,231		(22,031)		77,291
Less: Net (income) loss attributable to noncontrolling interest			(19,226)		(11,620)		(44,557)		(23,456)
Net income (loss) attributable to Nabors		$	(32,255)	$	4,611	$	(66,588)	$	53,835

Earnings (losses) per share:
Basic		$	(4.29)	$	(0.31)	$	(8.83)	$	4.05
Diluted		$	(4.29)	$	(0.31)	$	(8.83)	$	3.79

Weighted-average number of common shares outstanding:
Basic			9,207		9,195		9,191		9,178
Diluted			9,207		9,195		9,191		10,141

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023

	(in thousands)
Net income (loss) attributable to Nabors	$	(32,255)	$	4,611	$	(66,588)	$	53,835
Other comprehensive income (loss), before tax:
Translation adjustment attributable to Nabors		(47)		610		(181)		668
Pension liability amortization and adjustment		52		52		105		104
Other comprehensive income (loss), before tax		5		662		(76)		772
Income tax expense (benefit) related to items of other comprehensive income (loss)		12		12		24		24
Other comprehensive income (loss), net of tax		(7)		650		(100)		748
Comprehensive income (loss) attributable to Nabors		(32,262)		5,261		(66,688)		54,583
Comprehensive income (loss) attributable to noncontrolling interest		19,226		11,620		44,557		23,456
Comprehensive income (loss)	$	(13,036)	$	16,881	$	(22,131)	$	78,039

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Six Months Ended June 30,
	2024		2023

	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	(22,031)	$	77,291
Adjustments to net income (loss):
Depreciation and amortization		317,826		322,729
Deferred income tax expense (benefit)		11,239		12,135
Impairments and other charges		—		5,318
Amortization of debt discount and deferred financing costs		4,527		4,239
Losses (gains) on debt buyback		2,576		(25,098)
Losses (gains) on long-lived assets, net		11,111		927
Losses (gains) on investments, net		414		(960)
Share-based compensation		7,732		8,321
Foreign currency transaction losses (gains), net		17,894		16,810
Mark-to-market (gain) loss on warrants		(9,594)		(52,466)
Other		2,576		98
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable		(20,044)		27,461
Inventory		(1,574)		(24,125)
Other current assets		(8,023)		(5,595)
Other long-term assets		57		(6,373)
Trade accounts payable and accrued liabilities		887		(44,506)
Income taxes payable		(12,893)		1,896
Other long-term liabilities		(13,782)		4,414
Net cash provided by (used for) operating activities		288,898		322,516
Cash flows from investing activities:
Purchase of investments		(7,625)		(24,551)
Capital expenditures		(231,995)		(263,485)
Proceeds from sales of assets		7,860		5,050
Other		4,662		12
Net cash (used for) provided by investing activities		(227,098)		(282,974)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		—		250,000
Reduction in long-term debt		(631,043)		(292,853)
Debt issuance costs		(1,343)		(8,036)
Proceeds from revolving credit facilities		130,000		125,000
Reduction in revolving credit facilities		(130,000)		(125,000)
Payments for employee taxes on net settlement of equity awards		(2,634)		(7,079)
Dividends to common and preferred shareholders		(87)		(194)
Distributions to noncontrolling interest		(950)		(2,269)
Special purpose acquisition company redemptions by non-controlling redeemable shareholders		—		(186,933)
Other		(282)		—
Net cash (used for) provided by financing activities		(636,339)		(247,364)
Effect of exchange rate changes on cash and cash equivalents		(9,197)		(8,641)
Net increase (decrease) in cash and cash equivalents and restricted cash		(583,736)		(216,463)
Cash and cash equivalents and restricted cash, beginning of period		1,374,182		737,140
Cash and cash equivalents and restricted cash, end of period	$	790,446	$	520,677

RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents, beginning of period		1,057,487		451,025
Restricted cash, beginning of period		316,695		286,115
Cash and cash equivalents and restricted cash, beginning of period	$	1,374,182	$	737,140

Cash and cash equivalents, end of period		465,953		413,376
Restricted cash, end of period		324,493		107,301
Cash and cash equivalents and restricted cash, end of period	$	790,446	$	520,677

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)


				Capital		Accumulated			Retained
	Common Shares			in Excess		Other		Earnings				Non-
		Par		of Par		Comprehensive		(Accumulated		Treasury		controlling		Total
(In thousands)	Shares	Value		Value		Income (Loss)		Loss)		Shares		Interest		Equity
As of March 31, 2023	10,630	$	531	$	3,533,240	$	(10,940)	$	(1,804,369)	$	(1,315,751)	$	179,671	$	582,382
Net income (loss)	—		—		—		—		4,611		—		11,620		16,231
Other comprehensive income (loss), net of tax	—		—		—		650		—		—		—		650
Share-based compensation	7		—		4,341		—		—		—		—		4,341
Deemed dividends to SPAC public shareholders	—		—		—		—		(2,220)		—		—		(2,220)
Noncontrolling interest contributions (distributions)	—		—		—		—		—		—		(2,269)		(2,269)
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—		—		—		(7,436)		—		—		(7,436)
Other	(2)		—		(7)		—		—		—		—		(7)
As of June 30, 2023	10,635	$	531	$	3,537,574	$	(10,290)	$	(1,809,414)	$	(1,315,751)	$	189,022	$	591,672

As of March 31, 2024	10,702	$	535	$	3,540,409	$	(10,925)	$	(1,927,930)	$	(1,315,751)	$	236,485	$	522,823
Net income (loss)	—		—		—		—		(32,255)		—		19,226		(13,029)
Other comprehensive income (loss), net of tax	—		—		—		(7)		—		—		—		(7)
Share-based compensation	9		—		3,577		—		—		—		—		3,577
Noncontrolling interest contributions (distributions)	—		—		—		—		—		—		(4,482)		(4,482)
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—		—		—		(7,283)		—		—		(7,283)
Other	—		—		—		—		1		—		—		1
As of June 30, 2024	10,711	$	535	$	3,543,986	$	(10,932)	$	(1,967,467)	$	(1,315,751)	$	251,229	$	501,600

Table of Contents


				Capital		Accumulated			Retained
	Common Shares			in Excess		Other		Earnings				Non-
		Par		of Par		Comprehensive		(Accumulated		Treasury		controlling		Total
(In thousands)	Shares	Value		Value		Income (Loss)		Loss)		Shares		Interest		Equity
As of December 31, 2022	10,505	$	525	$	3,536,373	$	(11,038)	$	(1,841,153)	$	(1,315,751)	$	167,835	$	536,791
Net income (loss)	—		—		—		—		53,835		—		23,456		77,291
Other comprehensive income (loss), net of tax	—		—		—		748		—		—		—		748
Deemed dividends to SPAC public shareholders	—		—		—		—		(7,357)		—		—		(7,357)
Share-based compensation	179		8		8,313		—		—		—		—		8,321
Noncontrolling interest contributions (distributions)	—		—		—		—		—		—		(2,269)		(2,269)
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—		—		—		(14,790)		—		—		(14,790)
Other	(49)		(2)		(7,112)		—		51		—		—		(7,063)
As of June 30, 2023	10,635	$	531	$	3,537,574	$	(10,290)	$	(1,809,414)	$	(1,315,751)	$	189,022	$	591,672

As of December 31, 2023	10,556	$	527	$	3,538,896	$	(10,832)	$	(1,886,226)	$	(1,315,751)	$	215,396	$	542,010
Net income (loss)	—		—		—		—		(66,588)		—		44,557		(22,031)
Other comprehensive income (loss), net of tax

NABORS INDUSTRIES LTD [NBR] Filings
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10-Q	[2023-04-27]
10-K	[2023-02-09]
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10-Q	[2020-05-08]
10-K	[2020-02-25]
10-Q	[2019-11-01]
10-Q	[2019-08-01]
10-Q	[2019-05-01]
10-K	[2019-02-28]
10-Q	[2018-11-07]
10-Q	[2018-08-01]
10-Q	[2018-05-03]
10-K	[2018-03-01]
10-Q	[2017-11-03]
10-Q	[2017-08-03]
10-Q	[2017-04-28]
10-K	[2017-02-28]
10-Q	[2016-11-02]
10-Q	[2016-08-03]
10-Q	[2016-05-03]
10-K	[2016-02-26]
10-Q	[2015-11-06]
10-Q	[2015-08-05]
10-Q	[2015-05-04]
10-K	[2015-03-02]
10-Q	[2014-11-10]
10-Q	[2014-08-06]
10-Q	[2014-05-09]
10-K	[2014-03-03]
10-Q	[2013-11-01]
10-Q	[2013-08-02]
10-Q	[2013-05-02]
10-K	[2013-03-01]
10-Q	[2012-11-02]
10-Q	[2012-08-03]
10-Q	[2012-05-04]
10-K	[2012-02-29]

NABORS INDUSTRIES LTD [NBR] Filings

NABORS INDUSTRIES LTD [NBRWF] Filings