Nabors Industries Ltd 10-Q for FY2024 Q3

Nabors Industries Ltd (NBR)

10-Q 2024-11-01 For: 2024-09-30

Added on April 08, 2026

About this 10-Q

Nabors Industries Ltd filed this 10-Q on November 1, 2024, covering the quarter ended September 30, 2024 (FY2024 Q3).

Headline figures

Quarter ended September 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $731.81M; down 0.3% from $733.97M a year earlier
Net loss: $55.83M; compared with a net loss of $48.92M a year earlier
Diluted EPS: -$6.86; compared with -$6.26 a year earlier

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



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


Large Accelerated Filer ☒		Accelerated Filer ☐

Non-accelerated Filer ☐		Smaller reporting company ☐
	Emerging growth company ☐


PART I FINANCIAL INFORMATION

Item 1.	Financial Statements

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

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

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

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

	Condensed Consolidated Statements of Changes in Equity for the Three and Nine Months Ended September 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	35

Item 4.	Controls and Procedures	35

PART II OTHER INFORMATION

Item 1.	Legal Proceedings	35

Item 1A.	Risk Factors	35

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38

Item 3.	Defaults Upon Senior Securities	39

Item 4.	Mine Safety Disclosures	39

Item 5.	Other Information	39

Item 6.	Exhibits	39

Signatures		40


	September 30,		December 31,
	2024		2023

	(In thousands, except for
	share amounts)
ASSETS
Current assets:
Cash and cash equivalents	$	451,649	$	1,057,487
Short-term investments		7,653		12,691
Accounts receivable, net of allowance of $54,247 and $52,864, respectively		384,723		347,837
Inventory, net		141,864		147,798
Other current assets		86,436		79,865
Total current assets		1,072,325		1,645,678
Property, plant and equipment, net		2,766,411		2,898,728
Restricted cash held in trust		328,009		315,488
Deferred income taxes		227,658		238,871
Other long-term assets		159,233		179,200
Total assets (1)	$	4,553,636	$	5,277,965
LIABILITIES AND EQUITY
Current liabilities:
Current portion of debt	$	—	$	629,621
Trade accounts payable		316,694		294,442
Accrued liabilities		218,472		230,240
Income taxes payable		30,552		54,255
Current lease liabilities		5,860		5,423
Total current liabilities		571,578		1,213,981
Long-term debt		2,503,270		2,511,519
Other long-term liabilities		242,766		270,014
Deferred income taxes		1,913		1,366
Total liabilities (1)		3,319,527		3,996,880
Commitments and contingencies (Note 8)
Redeemable noncontrolling interest in subsidiary		773,525		739,075

Shareholders’ equity:
Common shares, par value $0.05 per share:
Authorized common shares 32,000; issued 10,709 and 10,556, respectively		535		527
Capital in excess of par value		3,548,079		3,538,896
Accumulated other comprehensive income (loss)		(10,844)		(10,832)
Retained earnings (accumulated deficit)		(2,030,656)		(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		191,363		326,614
Noncontrolling interest		269,221		215,396
Total equity		460,584		542,010
Total liabilities and equity	$	4,553,636	$	5,277,965


		Three Months Ended				Nine Months Ended
		September 30,				September 30,
		2024		2023		2024		2023

	(In thousands, except per share amounts)
Revenues and other income:
Operating revenues		$	731,805	$	733,974	$	2,200,307	$	2,280,180
Investment income (loss)			11,503		10,169		29,885		31,778
Total revenues and other income			743,308		744,143		2,230,192		2,311,958

Costs and other deductions:
Direct costs			431,705		447,751		1,309,007		1,365,611
General and administrative expenses			63,976		62,182		187,881		187,144
Research and engineering			14,404		14,016		42,629		42,371
Depreciation and amortization			159,234		161,337		477,060		484,066
Interest expense			55,350		44,042		157,222		135,347
Other, net			41,608		35,546		69,795		(8,604)
Total costs and other deductions			766,277		764,874		2,243,594		2,205,935
Income (loss) before income taxes			(22,969)		(20,731)		(13,402)		106,023
Income tax expense (benefit):
Current			10,581		6,241		30,940		43,569
Deferred			(463)		4,272		10,776		16,407
Total income tax expense (benefit)			10,118		10,513		41,716		59,976
Net income (loss)			(33,087)		(31,244)		(55,118)		46,047
Less: Net (income) loss attributable to noncontrolling interest			(22,738)		(17,672)		(67,295)		(41,128)
Net income (loss) attributable to Nabors		$	(55,825)	$	(48,916)	$	(122,413)	$	4,919

Earnings (losses) per share:
Basic		$	(6.86)	$	(6.26)	$	(15.69)	$	(2.79)
Diluted		$	(6.86)	$	(6.26)	$	(15.69)	$	(2.79)

Weighted-average number of common shares outstanding:
Basic			9,213		9,148		9,199		9,168
Diluted			9,213		9,148		9,199		9,168


	Nine Months Ended September 30,
	2024		2023

	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	(55,118)	$	46,047
Adjustments to net income (loss):
Depreciation and amortization		477,060		484,066
Deferred income tax expense (benefit)		10,776		16,407
Impairments and other charges		15,379		5,318
Amortization of debt discount and deferred financing costs		6,757		6,393
Losses (gains) on debt buyback		14,857		(25,202)
Losses (gains) on sale of long-lived assets, net		17,109		7,980
Losses (gains) on investments, net		412		(1,089)
Share-based compensation		11,825		12,671
Foreign currency transaction losses (gains), net		21,317		21,725
Mark-to-market (gain) loss on warrants		(12,538)		(44,314)
Other		5,033		144
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable		(38,163)		(1,890)
Inventory		4,337		(18,305)
Other current assets		(6,900)		12,140
Other long-term assets		(1,311)		(786)
Trade accounts payable and accrued liabilities		583		(63,389)
Income taxes payable		(24,912)		(5,892)
Other long-term liabilities		(13,990)		3,917
Net cash provided by (used for) operating activities		432,513		455,941
Cash flows from investing activities:
Purchase of investments		(7,681)		(28,083)
Capital expenditures		(359,873)		(406,695)
Proceeds from sales of assets		9,667		9,677
Other		4,671		(3,873)
Net cash (used for) provided by investing activities		(353,216)		(428,974)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		550,000		250,000
Reduction in long-term debt		(1,197,024)		(296,547)
Debt issuance costs		(11,045)		(8,036)
Proceeds from revolving credit facilities		225,000		220,000
Reduction in revolving credit facilities		(225,000)		(220,000)
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)
Sale of non-controlling interest - special purpose acquisition company		—		305,000
Other		(282)		274
Net cash (used for) provided by financing activities		(662,022)		54,216
Effect of exchange rate changes on cash and cash equivalents		(10,446)		(10,773)
Net increase (decrease) in cash and cash equivalents and restricted cash		(593,171)		70,410
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	$	781,011	$	807,550

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		451,649		387,483
Restricted cash, end of period		329,362		420,067
Cash and cash equivalents and restricted cash, end of period	$	781,011	$	807,550


				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 June 30, 2023	10,635	$	531	$	3,537,574	$	(10,290)	$	(1,809,414)	$	(1,315,751)	$	189,022	$	591,672
Net income (loss)	—		—		—		—		(48,916)		—		17,672		(31,244)
Share issuance adjustment, net of tax	—		(4)		(6,196)		—		4,824		—		—		(1,376)
Other comprehensive income (loss), net of tax	—		—		—		(132)		—		—		—		(132)
IPO Warrants to SPAC public shareholders	—		—		—		—		—		—		3,426		3,426
Share-based compensation	—		—		4,350		—		—		—		—		4,350
Deemed dividends to SPAC public shareholders	—		—		—		—		(823)		—		(17,556)		(18,379)
Noncontrolling interest contributions (distributions)	—		—		—		—		—		—		7,374		7,374
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—		—		—		(7,517)		—		—		(7,517)
Other	(1)		—		—		—		(2)		—		—		(2)
As of September 30, 2023	10,634	$	527	$	3,535,728	$	(10,422)	$	(1,861,848)	$	(1,315,751)	$	199,938	$	548,172

As of June 30, 2024	10,711	$	535	$	3,543,986	$	(10,932)	$	(1,967,467)	$	(1,315,751)	$	251,229	$	501,600
Net income (loss)	—		—		—		—		(55,825)		—		22,738		(33,087)
Other comprehensive income (loss), net of tax	—		—		—		88		—		—		—		88
Share-based compensation	(2)		—		4,093		—		—		—		—		4,093
Noncontrolling interest contributions (distributions)	—		—		—		—		—		—		(4,746)		(4,746)
Accrued distribution on redeemable noncontrolling interest in subsidiary	—		—		—		—		(7,363)		—		—		(7,363)
Other	—		—		—		—		(1)		—		—		(1)
As of September 30, 2024	10,709	$	535	$	3,548,079	$	(10,844)	$	(2,030,656)	$	(1,315,751)	$	269,221	$	460,584


		September 30, 2024				December 31, 2023

		Carrying		Fair		Carrying		Fair
		Value		Value		Value		Value

	(In thousands)
0.75% senior exchangeable notes due January 2024		$	—	$	—	$	155,529	$	154,989
5.75% senior notes due February 2025			—		—		474,092		474,120
7.25% senior guaranteed notes due January 2026			—		—		555,902		535,328
7.375% senior priority guaranteed notes due May 2027			700,000		702,086		700,000		687,526
7.50% senior guaranteed notes due January 2028			389,609		366,642		389,609		334,090
1.75% senior exchangeable notes due June 2029			250,000		196,743		250,000		185,383
9.125% senior priority guaranteed notes due January 2030			650,000		671,268		650,000		656,871
8.875% senior guaranteed notes due August 2031			550,000		523,523		—		—
		$	2,539,609	$	2,460,261	$	3,175,132	$	3,028,307
Less: current portion			—				629,621
Less: deferred financing costs			36,339				33,992
		$	2,503,270			$	2,511,519


	Maximum Amount
	2024		2025	2026	Thereafter	Total

	(In thousands)
Financial standby letters of credit and other financial surety instruments	$	27,791	18,295	3,763	12,547	$	62,396



	Gains		Defined
	(losses) on		benefit		Foreign
	cash flow		pension plan		currency
	hedges		items		items		Total

	(In thousands (1) )
As of January 1, 2023	$	2	$	(3,767)	$	(7,273)	$	(11,038)
Other comprehensive income (loss) before reclassifications		—		—		496		496
Amounts reclassified from accumulated other comprehensive income (loss)		—		120		—		120
Net other comprehensive income (loss)		—		120		496		616
As of September 30, 2023	$	2	$	(3,647)	$	(6,777)	$	(10,422)


	Three Months Ended
	September 30, 2024
		U.S. Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total

	(In thousands)
Lower 48	$	217,138	$	—	$	42,161	$	20,661	$	—	$	279,960
U.S. Offshore Gulf of Mexico		25,510		—		1,969		—		—		27,479
Alaska		12,125		—		501		—		—		12,626
Canada		—		—		416		936		—		1,352
Middle East & Asia		—		250,740		13,321		19,067		—		283,128
Latin America		—		94,140		20,735		3,361		—		118,236
Europe, Africa & CIS		—		23,714		441		1,784		—		25,939
Eliminations & other		—		—		—		—		(16,915)		(16,915)
Total	$	254,773	$	368,594	$	79,544	$	45,809	$	(16,915)	$	731,805


	Three Months Ended
	September 30, 2023
		U.S. Drilling		International Drilling		Drilling Solutions		Rig Technologies		Other		Total

	(In thousands)
Lower 48	$	241,900	$	—	$	45,646	$	27,453	$	—	$	314,999
U.S. Offshore Gulf of Mexico		25,768		—		2,974		—		—		28,742
Alaska		8,717		—		469		—		—		9,186
Canada		—		—		467		1,526		—		1,993
Middle East & Asia		—		243,691		10,550		27,430		—		281,671
Latin America		—		86,665		11,885		3,265		—		101,815
Europe, Africa & CIS		—		14,424		840		1,763		—		17,027
Eliminations & other		—		—		—		—		(21,459)		(21,459)
Total	$	276,385	$	344,780	$	72,831	$	61,437	$	(21,459)	$	733,974


			Contract		Contract		Contract		Contract
	Contract		Assets		Assets		Liabilities		Liabilities
	Receivables		(Current)		(Long-term)		(Current)		(Long-term)

	(In thousands)
As of December 31, 2023	$	397,051	$	8,434	$	2,980	$	20,295	$	1,969
As of September 30, 2024	$	431,925	$	18,331	$	6,057	$	24,617	$	1,918


					Approximated
				Total Number	Dollar Value of
				of Shares	Shares that May
	Total	Average		Purchased as	Yet Be
	Number of	Price		Part of Publicly	Purchased
Period	Shares	Paid per		Announced	Under the
(In thousands, except per share amounts)	Repurchased	Share (1)		Program	Program (2)
July 1 - July 31	1	$	82.08	—	278,914
August 1 - August 31	—	$	—	—	278,914
September 1 - September 30	—	$	—	—	278,914


		Three Months Ended				Nine Months Ended
		September 30,				September 30,
		2024		2023		2024		2023

	(In thousands)
Adjusted operating income (loss): (2)
U.S. Drilling		$	41,694	$	49,582	$	137,308	$	210,859
International Drilling			32,182		9,862		78,330		22,226
Drilling Solutions			29,231		25,341		83,443		80,830
Rig Technologies			2,761		4,995		11,830		13,741
Total segment adjusted operating income (loss)		$	105,868	$	89,780	$	310,911	$	327,656


	September 30,		December 31,
	2024		2023

	(In thousands)
Total assets:
U.S. Drilling	$	1,108,961	$	1,239,765
International Drilling		2,321,729		2,227,308
Drilling Solutions		77,810		78,472
Rig Technologies		213,507		239,167
Other reconciling items (3)		831,629		1,493,253
Total	$	4,553,636	$	5,277,965



Exhibit No.		Description
2.1		Agreement and Plan of Merger, dated as of October 14, 2024, by and among Nabors Industries Ltd., Nabors SubA Corporation, Parker Drilling Company and Värde Partners, Inc., solely in its capacity as the Stockholder Representative. (Incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).†
2.2		Voting and Support Agreement, dated as of October 14, 2024, by and among the Supporting Stockholders and Nabors. (Incorporated by reference to Exhibit 2.2 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).
2.3		Form of Voting and Lock-Up Agreement, dated as of October 14, 2024, by and among certain Supporting Stockholders and Nabors. (Incorporated by reference to Exhibit 2.3 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).
2.4		Form of Voting and Lock-Up Agreement, dated as of October 14, 2024, by and among certain Supporting Stockholders and Nabors. (Incorporated by reference to Exhibit 2.4 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).
2.5		Form of Voting and Lock-Up Agreement, dated as of October 14, 2024, by and among certain Supporting Stockholders and Nabors. (Incorporated by reference to Exhibit 2.5 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).
2.6		Form of Voting and Lock-Up Agreement, dated as of October 14, 2024, by and among certain Supporting Stockholders and Nabors. (Incorporated by reference to Exhibit 2.6 of the Current Report on Form 8-K filed by the Registrant on October 15, 2024).
10.1		Amended & Restated Credit Agreement, dated as of June 17, 2024, among Nabors Industries, Inc., as Borrower, Nabors Industries Ltd., as Holdings, the other Guarantors from time to time party thereto, the Issuing Banks and other Lenders party thereto and Citibank, N.A., as Administrative Agent. (Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed by the Registrant on June 17, 2024).
31.1		Rule 13a-14(a)/15d-14(a) Certification of Anthony G. Petrello, Chairman, President and Chief Executive Officer*
31.2		Rule 13a-14(a)/15d-14(a) Certification of William Restrepo, Chief Financial Officer*

32.1		Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Anthony G. Petrello, Chairman, President and Chief Executive Officer and William Restrepo, Chief Financial Officer.*
101.INS		Inline XBRL Instance Document*
101.SCH		Inline XBRL Schema Document*
101.CAL		Inline XBRL Calculation Linkbase Document*
101.LAB		Inline XBRL Label Linkbase Document*
101.PRE		Inline XBRL Presentation Linkbase Document*
101.DEF		Inline XBRL Definition Linkbase Document*
104		Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document)


	NABORS INDUSTRIES LTD.

	By:	/s/ ANTHONY G. PETRELLO
		Anthony G. Petrello
		Chairman, President and
		Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ WILLIAM RESTREPO
		William Restrepo
		Chief Financial Officer (Principal Financial Officer and Accounting Officer)

	Date:	November 1, 2024


Date: November 1, 2024		/s/ ANTHONY G. PETRELLO
		Anthony G. Petrello
		Chairman, President and Chief Executive Officer