Pioneer Energy Services Reports Third Quarter 2019 Results
Oct 31, 2019
SAN ANTONIO, Oct. 31, 2019 /PRNewswire/ -- Pioneer Energy Services (OTCQX: PESX) today reported financial and operating results for the quarter ended September 30, 2019. Third quarter highlights include:
- Well servicing revenues increased 3% sequentially, and gross margin was 29.4%, up from 28.7% in the prior quarter.
- International drilling fleet was 71% utilized and generated an average margin of $11,080 per day, roughly flat with the prior quarter.
- Domestic drilling fleet was 88% utilized and generated an average margin of $11,740 per day, which included the benefit of approximately $1,374 per day for the early termination of a drilling contract.
Consolidated Financial Results
Revenues for the third quarter of 2019 were $146.4 million, down 4% from revenues of $152.8 million in the second quarter of 2019 ("the prior quarter"). Net loss for the third quarter of 2019 was $26.0 million, or $0.33 per share, compared with net loss of $12.9 million, or $0.17 per share, in the prior quarter. Adjusted net loss(1) for the third quarter was $23.6 million, and adjusted EPS(2) was a loss of $0.30 per share. These results compare to an adjusted net loss of $11.8 million, and an adjusted EPS loss of $0.15 per share in the prior quarter. Third quarter adjusted EBITDA(3) was $7.1 million, down from $20.7 million in the prior quarter. The decrease in adjusted EBITDA and adjusted net loss was primarily due to approximately $12.6 million of additional net general and administrative expenses related to new compensation plans, partially offset by the cancellation of certain previously existing incentive plans, as well as professional fees incurred to evaluate debt restructuring strategies.
Operating Results
Production Services Business
Revenue from our production services business was $86.6 million in the third quarter, down 1% from the prior quarter. Well servicing revenues increased 3%, primarily driven by higher revenue rates and steady activity levels for both maintenance and completion activity. Well servicing average revenue per hour was $580 in the third quarter, up from $569 in the prior quarter, while rig utilization was 59%, down slightly from 60% in the prior quarter. Wireline services, which accounted for 51% of production services revenue, experienced a decrease in perforating stage count of approximately 6%, yielding a revenue decrease of 7%, much of which came from reduced activity in September. Coiled tubing services revenue increased 14% due to higher activity levels in the Rockies as wildlife activity limitations and poor weather conditions impacted the prior quarter. Coiled tubing revenue days totaled 339 in the third quarter, up from 307 in the prior quarter, while revenue per day was $36,714, up from $35,430 in the prior quarter.
Gross margin as a percentage of revenue from our production services business was 19% in the third quarter, up from 17% in the prior quarter. The increase in gross margin in all businesses was primarily due to actions taken to reduce labor and overhead costs to include the closure of certain wireline locations and repositioning of certain coiled tubing assets.
Drilling Services Business
Revenue from our drilling services business was $59.8 million in the third quarter, reflecting a decrease of 8% from the prior quarter. Average margin per day was $11,560, up from $10,396 in the prior quarter.
Our domestic drilling fleet was 88% utilized with average revenues per day of $27,598 in the third quarter, up from $26,864 in the prior quarter. Domestic drilling average margin per day was $11,740 in the third quarter, up from $10,131 in the prior quarter, primarily due to the benefit of $1.9 million, or approximately $1,374 per day, from recognition of the early termination of a domestic drilling contract.
International drilling rig utilization was 71% for the third quarter, down from 86% in the prior quarter, driven partially by one rig mobilizing to work for a new client during the quarter. Average revenues per day were $41,491, up from $40,806 in the prior quarter, while average margin per day for the third quarter was $11,080, up slightly from $11,023 in the prior quarter. The increases in revenue per day and margin per day were primarily due to the timing of mobilization and demobilization revenues recognized in the third quarter.
Currently, 15 of our 17 domestic drilling rigs are earning revenues, 12 of which are under term contracts. Ten rigs are working in the Permian, three in Appalachia and two in the Bakken. Of the rigs on term contracts, only one rig is set to expire later in the fourth quarter of 2019. Many of the recent contract renewals are for periods between six months and one year in length.
In Colombia, six of our eight rigs are currently earning revenue under daywork contracts. We expect four to six rigs to remain active for the remainder of 2019.
Comments from our President and CEO
"While weaker oil prices and generally challenging market conditions have continued to negatively impact the U.S. rig count, which fell 10% from the prior quarter and 20% from the prior year, our domestic drilling and well servicing businesses have remained highly utilized, and we have successfully increased gross margins both sequentially and year-over-year," said Wm. Stacy Locke, President and Chief Executive Officer. "We do anticipate the typical seasonal softening in well servicing activity during the fourth quarter, but we expect business to remain stable as our customers continue to appreciate our high-quality service offering. U.S. drilling activity should remain stable, although we anticipate continued dayrate pressure. We mobilized one rig from the Appalachian Basin to the Permian Basin in the third quarter under a term contract with a new client, and we continue to focus on positioning our equipment to generate optimum margins.
"Our international operations in Colombia experienced lower utilization sequentially as we mobilized one rig to a new client during the quarter, but we have maintained solid margins and expect the business to remain stable with four to six rigs operating during the fourth quarter. As we enter 2020, we anticipate favorable activity levels in the country as operators continue to execute on long term drilling programs.
"For the rest of the year, the remaining capital expenditures will be routine maintenance in nature. While the Term Loan is not expected to mature until December 2021, we continue to proactively explore various strategic and other alternatives to address the uncertainties related to our ability to refinance our outstanding debts as their maturities approach," concluded Mr. Locke.
Fourth Quarter 2019 Guidance
In the fourth quarter of 2019, we expect rig count to continue to decline, reduced completion activity and overall less spending by our clients, as well as typical seasonal impacts. As a result, we expect revenue from our production services business segments to be down approximately 15% to 19% as compared to the third quarter of 2019 driven primarily by wireline. We expect margins to be approximately 16% to 18% of revenue.
We expect domestic drilling services rig utilization to average approximately 90% to 94% and generate average margins per day of approximately $8,700 to $9,200 given recent dayrate renewal pressure in the U.S. In Colombia, we expect international drilling services rig utilization to average approximately 60% to 65% and generate average margins per day of approximately $8,500 to $9,500.
We expect general and administrative expense to be approximately $21 million in the fourth quarter of 2019, which includes approximately $2 million to $3 million in professional fees related to debt restructuring activities.
Liquidity
Working capital at September 30, 2019 was $97.5 million, down from $106.5 million at June 30, 2019 and $110.3 million at December 31, 2018. Cash and cash equivalents, including restricted cash, were $28.0 million, down from $31.1 million at June 30, 2019 and $54.6 million at year-end 2018. During the nine months ended September 30, 2019, we used $40.5 million of cash for routine capital expenditures and the purchase of property and equipment, and our cash provided by operations was $8.6 million.
Capital Expenditures
Cash capital expenditures during the nine months ended September 30, 2019 were $40.5 million, including capitalized interest. We estimate total cash capital expenditures for 2019 to be approximately $46 million to $49 million, which includes approximately $8 million for final payments on the construction of the new-build drilling rig and previous commitments on high-pressure pump packages for coiled tubing completion operations, all of which were made earlier in the year.
Conference Call
Pioneer Energy Services' management team will hold a conference call today at 11:00 a.m. Eastern Time (10:00 a.m. Central Time) to discuss these results. To participate, dial (412) 902-0003 approximately 10 minutes prior to the call and ask for the Pioneer Energy Services conference call. A telephone replay will be available after the call until November 7th. To access the replay, dial (201) 612-7415 and enter the pass code 13695038.
The conference call will also be webcast on the Internet and accessible from Pioneer Energy Services' web site at www.pioneeres.com. To listen to the live call, visit our web site at least 10 minutes early to register and download any necessary audio software. For more information, please contact Donna Washburn at Dennard Lascar Investor Relations at (713) 529-6600 or e-mail dwashburn@dennardlascar.com.
About Pioneer
Pioneer Energy Services provides well servicing, wireline, and coiled tubing services to producers primarily in Texas and the Mid-Continent and Rocky Mountain regions. Pioneer also provides contract land drilling services to oil and gas operators in Texas, Appalachia and Rocky Mountain regions and internationally in Colombia.
Cautionary Statement Regarding Forward-Looking Statements,
Non-GAAP Financial Measures and Reconciliations
Statements we make in this news release that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements made in good faith that are subject to risks, uncertainties and assumptions. These forward-looking statements are based on our current beliefs, intentions, and expectations and are not guarantees or indicators of future performance. Our actual results, performance or achievements, or industry results, could differ materially from those we express in the foregoing discussion as a result of a variety of factors, including general economic and business conditions and industry trends, levels and volatility of oil and gas prices, the continued demand for drilling services or production services in the geographic areas where we operate, decisions about exploration and development projects to be made by oil and gas exploration and production companies, the highly competitive nature of our business, technological advancements and trends in our industry and improvements in our competitors' equipment, the loss of one or more of our major clients or a decrease in their demand for our services, future compliance with covenants under debt agreements, including our senior secured term loan, our senior secured revolving asset-based credit facility, and our senior notes, operating hazards inherent in our operations, the supply of marketable drilling rigs, well servicing rigs, coiled tubing units and wireline units within the industry, the continued availability of new components for drilling rigs, well servicing rigs, coiled tubing units and wireline units, the continued availability of qualified personnel, the success or failure of our acquisition strategy, the occurrence of cybersecurity incidents, the political, economic, regulatory and other uncertainties encountered by our operations, and changes in, or our failure or inability to comply with, governmental regulations, including those relating to the environment. We have discussed many of these factors in more detail in our Annual Report on Form 10-K for the year ended December 31, 2018, including under the headings "Risk Factors" in Item 1A and "Special Note Regarding Forward-Looking Statements" in the Introductory Note to Part I. These factors are not necessarily all the important factors that could affect us. Other unpredictable or unknown factors could also have material adverse effects on actual results of matters that are the subject of our forward-looking statements. All forward-looking statements speak only as of the date on which they are made and we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. We advise our shareholders that they should (1) recognize that important factors not referred to above could affect the accuracy of our forward-looking statements and (2) use caution and common sense when considering our forward-looking statements.
This news release contains non-GAAP financial measures as defined by SEC Regulation G. A reconciliation of each such measure to its most directly comparable U.S. Generally Accepted Accounting Principles (GAAP) financial measure, together with an explanation of why management believes that these non-GAAP financial measures provide useful information to investors, is provided in the following tables.
_________________________________
(1) | Adjusted net loss represents net loss as reported adjusted to exclude impairments and the related tax benefit and valuation allowance adjustments on deferred tax assets. We believe that adjusted net loss is a useful measure to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers, although it is not a measure of financial performance under GAAP. Adjusted net loss may not be comparable to other similarly titled measures reported by other companies. A reconciliation of net loss as reported to adjusted net loss is included in the tables to this news release. |
(2) | Adjusted (diluted) EPS represents adjusted net loss divided by the weighted-average number of shares outstanding during the period, including the effect of dilutive securities, if any. We believe that adjusted (diluted) EPS is a useful measure to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers, although it is not a measure of financial performance under GAAP. Adjusted (diluted) EPS may not be comparable to other similarly titled measures reported by other companies. A reconciliation of diluted EPS as reported to adjusted (diluted) EPS is included in the tables to this news release. |
(3) | Adjusted EBITDA represents income (loss) before interest expense, income tax (expense) benefit, depreciation and amortization, impairment, and any loss on extinguishment of debt. Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of our core operating performance and makes it easier to compare our results with those of other companies within our industry. Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities or (c) as a measure of liquidity. In addition, Adjusted EBITDA does not represent funds available for discretionary use. Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies. A reconciliation of net loss as reported to adjusted EBITDA is included in the tables to this news release. |
Contacts: Dan Petro, CFA, Vice President, Treasury and Pioneer Energy Services Corp. (210) 828-7689 Lisa Elliott / pes@dennardlascar.com Dennard Lascar Investor Relations / (713) 529-6600
Investor Relations
- Financial Statements and Operating Information Follow -
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||
September 30, | June 30, | September 30, | |||||||||||||||||
2019 | 2018 | 2019 | 2019 | 2018 | |||||||||||||||
Revenues | $ | 146,398 | $ | 149,332 | $ | 152,843 | $ | 445,809 | $ | 448,592 | |||||||||
Costs and expenses: | |||||||||||||||||||
Operating costs | 108,059 | 108,961 | 115,970 | 332,614 | 325,924 | ||||||||||||||
Depreciation | 22,924 | 23,501 | 22,851 | 68,428 | 70,535 | ||||||||||||||
General and administrative | 30,485 | 14,043 | 18,028 | 68,271 | 58,066 | ||||||||||||||
Bad debt expense (recovery), net | 196 | 111 | (348) | (90) | (311) | ||||||||||||||
Impairment | — | 239 | 332 | 1,378 | 2,607 | ||||||||||||||
Loss (gain) on dispositions of property and equipment, net | 17 | (1,861) | (1,126) | (2,184) | (2,922) | ||||||||||||||
Total costs and expenses | 161,681 | 144,994 | 155,707 | 468,417 | 453,899 | ||||||||||||||
Income (loss) from operations | (15,283) | 4,338 | (2,864) | (22,608) | (5,307) | ||||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net of interest capitalized | (10,013) | (9,811) | (10,105) | (30,003) | (28,966) | ||||||||||||||
Other income (expense), net | (588) | 498 | 349 | 445 | 1,046 | ||||||||||||||
Total other expense, net | (10,601) | (9,313) | (9,756) | (29,558) | (27,920) | ||||||||||||||
Loss before income taxes | (25,884) | (4,975) | (12,620) | (52,166) | (33,227) | ||||||||||||||
Income tax expense | (132) | (258) | (324) | (1,909) | (1,297) | ||||||||||||||
Net loss | $ | (26,016) | $ | (5,233) | $ | (12,944) | $ | (54,075) | $ | (34,524) | |||||||||
Loss per common share: | |||||||||||||||||||
Basic | $ | (0.33) | $ | (0.07) | $ | (0.17) | $ | (0.69) | $ | (0.44) | |||||||||
Diluted | $ | (0.33) | $ | (0.07) | $ | (0.17) | $ | (0.69) | $ | (0.44) | |||||||||
Weighted-average number of shares outstanding: | |||||||||||||||||||
Basic | 78,473 | 78,136 | 78,430 | 78,405 | 77,897 | ||||||||||||||
Diluted | 78,473 | 78,136 | 78,430 | 78,405 | 77,897 | ||||||||||||||
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||
Condensed Consolidated Balance Sheets | |||||||
(in thousands) | |||||||
September 30, | December 31, | ||||||
(unaudited) | (audited) | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 26,955 | $ | 53,566 | |||
Restricted cash | 998 | 998 | |||||
Receivables, net of allowance for doubtful accounts | 132,552 | 130,881 | |||||
Inventory | 22,086 | 18,898 | |||||
Assets held for sale | 6,233 | 3,582 | |||||
Prepaid expenses and other current assets | 6,991 | 7,109 | |||||
Total current assets | 195,815 | 215,034 | |||||
Net property and equipment | 485,255 | 524,858 | |||||
Operating lease assets | 7,692 | — | |||||
Other noncurrent assets | 931 | 1,658 | |||||
Total assets | $ | 689,693 | $ | 741,550 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 32,127 | $ | 34,134 | |||
Deferred revenues | 1,616 | 1,722 | |||||
Accrued expenses | 64,559 | 68,912 | |||||
Total current liabilities | 98,302 | 104,768 | |||||
Long-term debt, less unamortized discount and debt issuance costs | 466,887 | 464,552 | |||||
Noncurrent operating lease liabilities | 6,189 | — | |||||
Deferred income taxes | 4,708 | 3,688 | |||||
Other noncurrent liabilities | 459 | 3,484 | |||||
Total liabilities | 576,545 | 576,492 | |||||
Total shareholders' equity | 113,148 | 165,058 | |||||
Total liabilities and shareholders' equity | $ | 689,693 | $ | 741,550 | |||
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||
Condensed Consolidated Statements of Cash Flows | |||||||
(in thousands) | |||||||
(unaudited) | |||||||
Nine months ended | |||||||
September 30, | |||||||
2019 | 2018 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (54,075) | $ | (34,524) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation | 68,428 | 70,535 | |||||
Allowance for doubtful accounts, net of recoveries | (90) | (311) | |||||
Write-off of obsolete inventory | 502 | — | |||||
Gain on dispositions of property and equipment, net | (2,184) | (2,922) | |||||
Stock-based compensation expense | 2,013 | 3,395 | |||||
Phantom stock compensation expense | (99) | 2,808 | |||||
Amortization of debt issuance costs and discount | 2,335 | 2,153 | |||||
Impairment | 1,378 | 2,607 | |||||
Deferred income taxes | 1,020 | 189 | |||||
Change in other noncurrent assets | 3,125 | 541 | |||||
Change in other noncurrent liabilities | (4,163) | (735) | |||||
Changes in current assets and liabilities: | (9,552) | (22,246) | |||||
Net cash provided by operating activities | 8,638 | 21,490 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (40,543) | (48,778) | |||||
Proceeds from sale of property and equipment | 4,778 | 4,665 | |||||
Proceeds from insurance recoveries | 641 | 980 | |||||
Net cash used in investing activities | (35,124) | (43,133) | |||||
Cash flows from financing activities: | |||||||
Proceeds from exercise of options | — | 12 | |||||
Purchase of treasury stock | (125) | (549) | |||||
Net cash used in financing activities | (125) | (537) | |||||
Net decrease in cash, cash equivalents and restricted cash | (26,611) | (22,180) | |||||
Beginning cash, cash equivalents and restricted cash | 54,564 | 75,648 | |||||
Ending cash, cash equivalents and restricted cash | $ | 27,953 | $ | 53,468 | |||
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||||||||||||||
Operating Results by Segment | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||
September 30, | June 30, | September 30, | |||||||||||||||||
2019 | 2018 | 2019 | 2019 | 2018 | |||||||||||||||
Revenues: | |||||||||||||||||||
Domestic drilling | $ | 38,168 | $ | 36,586 | $ | 39,652 | $ | 115,829 | $ | 108,146 | |||||||||
International drilling | 21,617 | 23,131 | 25,422 | 68,682 | 62,515 | ||||||||||||||
Drilling services | 59,785 | 59,717 | 65,074 | 184,511 | 170,661 | ||||||||||||||
Well servicing | 30,293 | 24,369 | 29,506 | 86,053 | 68,645 | ||||||||||||||
Wireline services | 43,874 | 52,654 | 47,386 | 137,134 | 171,392 | ||||||||||||||
Coiled tubing services | 12,446 | 12,592 | 10,877 | 38,111 | 37,894 | ||||||||||||||
Production services | 86,613 | 89,615 | 87,769 | 261,298 | 277,931 | ||||||||||||||
Consolidated revenues | $ | 146,398 | $ | 149,332 | $ | 152,843 | $ | 445,809 | $ | 448,592 | |||||||||
Operating costs: | |||||||||||||||||||
Domestic drilling | $ | 21,931 | $ | 21,650 | $ | 24,698 | $ | 69,098 | $ | 64,297 | |||||||||
International drilling | 15,844 | 19,013 | 18,555 | 50,884 | 49,038 | ||||||||||||||
Drilling services | 37,775 | 40,663 | 43,253 | 119,982 | 113,335 | ||||||||||||||
Well servicing | 21,414 | 17,193 | 21,038 | 61,348 | 49,443 | ||||||||||||||
Wireline services | 38,349 | 40,840 | 41,804 | 119,500 | 130,042 | ||||||||||||||
Coiled tubing services | 10,521 | 10,265 | 9,875 | 31,784 | 33,104 | ||||||||||||||
Production services | 70,284 | 68,298 | 72,717 | 212,632 | 212,589 | ||||||||||||||
Consolidated operating costs | $ | 108,059 | $ | 108,961 | $ | 115,970 | $ | 332,614 | $ | 325,924 | |||||||||
Gross margin: | |||||||||||||||||||
Domestic drilling | $ | 16,237 | $ | 14,936 | $ | 14,954 | $ | 46,731 | $ | 43,849 | |||||||||
International drilling | 5,773 | 4,118 | 6,867 | 17,798 | 13,477 | ||||||||||||||
Drilling services | 22,010 | 19,054 | 21,821 | 64,529 | 57,326 | ||||||||||||||
Well servicing | 8,879 | 7,176 | 8,468 | 24,705 | 19,202 | ||||||||||||||
Wireline services | 5,525 | 11,814 | 5,582 | 17,634 | 41,350 | ||||||||||||||
Coiled tubing services | 1,925 | 2,327 | 1,002 | 6,327 | 4,790 | ||||||||||||||
Production services | 16,329 | 21,317 | 15,052 | 48,666 | 65,342 | ||||||||||||||
Consolidated gross margin | $ | 38,339 | $ | 40,371 | $ | 36,873 | $ | 113,195 | $ | 122,668 | |||||||||
Consolidated: | |||||||||||||||||||
Net loss | $ | (26,016) | $ | (5,233) | $ | (12,944) | $ | (54,075) | $ | (34,524) | |||||||||
Adjusted EBITDA (1) | $ | 7,053 | $ | 28,576 | $ | 20,668 | $ | 47,643 | $ | 68,881 | |||||||||
(1) Adjusted EBITDA represents income (loss) before interest expense, income tax (expense) benefit, depreciation and amortization, impairment, and any loss on extinguishment of debt. Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers. We believe that this measure is useful to investors and analysts in allowing for greater transparency of our core operating performance and makes it easier to compare our results with those of other companies within our industry. Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an indication of cash flows from operating activities or (c) as a measure of liquidity. In addition, Adjusted EBITDA does not represent funds available for discretionary use. Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies. A reconciliation of net loss as reported to adjusted EBITDA is included in the table on page 12. |
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||||||||||||||
Operating Statistics | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||
September 30, | June 30, | September 30, | |||||||||||||||||
2019 | 2018 | 2019 | 2019 | 2018 | |||||||||||||||
Domestic drilling: | |||||||||||||||||||
Average number of drilling rigs | 17 | 16 | 17 | 17 | 16 | ||||||||||||||
Utilization rate | 88 | % | 99 | % | 95 | % | 94 | % | 100 | % | |||||||||
Revenue days | 1,383 | 1,459 | 1,476 | 4,279 | 4,353 | ||||||||||||||
Average revenues per day | $ | 27,598 | $ | 25,076 | $ | 26,864 | $ | 27,069 | $ | 24,844 | |||||||||
Average operating costs per day | 15,858 | 14,839 | 16,733 | 16,148 | 14,771 | ||||||||||||||
Average margin per day | $ | 11,740 | $ | 10,237 | $ | 10,131 | $ | 10,921 | $ | 10,073 | |||||||||
International drilling: | |||||||||||||||||||
Average number of drilling rigs | 8 | 8 | 8 | 8 | 8 | ||||||||||||||
Utilization rate | 71 | % | 76 | % | 86 | % | 79 | % | 79 | % | |||||||||
Revenue days | 521 | 562 | 623 | 1,724 | 1,733 | ||||||||||||||
Average revenues per day | $ | 41,491 | $ | 41,158 | $ | 40,806 | $ | 39,839 | $ | 36,073 | |||||||||
Average operating costs per day | 30,411 | 33,831 | 29,783 | 29,515 | 28,297 | ||||||||||||||
Average margin per day | $ | 11,080 | $ | 7,327 | $ | 11,023 | $ | 10,324 | $ | 7,776 | |||||||||
Drilling services business: | |||||||||||||||||||
Average number of drilling rigs | 25 | 24 | 25 | 25 | 24 | ||||||||||||||
Utilization rate | 83 | % | 92 | % | 92 | % | 89 | % | 93 | % | |||||||||
Revenue days | 1,904 | 2,021 | 2,099 | 6,003 | 6,086 | ||||||||||||||
Average revenues per day | $ | 31,400 | $ | 29,548 | $ | 31,002 | $ | 30,736 | $ | 28,042 | |||||||||
Average operating costs per day | 19,840 | 20,120 | 20,606 | 19,987 | 18,622 | ||||||||||||||
Average margin per day | $ | 11,560 | $ | 9,428 | $ | 10,396 | $ | 10,749 | $ | 9,420 | |||||||||
Well servicing: | |||||||||||||||||||
Average number of rigs | 125 | 125 | 125 | 125 | 125 | ||||||||||||||
Utilization rate | 59 | % | 51 | % | 60 | % | 58 | % | 49 | % | |||||||||
Rig hours | 52,210 | 44,155 | 51,895 | 151,169 | 127,800 | ||||||||||||||
Average revenue per hour | $ | 580 | $ | 552 | $ | 569 | $ | 569 | $ | 537 | |||||||||
Wireline services: | |||||||||||||||||||
Average number of units | 94 | 104 | 95 | 98 | 107 | ||||||||||||||
Number of jobs | 2,077 | 2,684 | 2,278 | 6,697 | 8,536 | ||||||||||||||
Average revenue per job | $ | 21,124 | $ | 19,618 | $ | 20,802 | $ | 20,477 | $ | 20,079 | |||||||||
Coiled tubing services: | |||||||||||||||||||
Average number of units | 9 | 11 | 9 | 9 | 13 | ||||||||||||||
Revenue days | 339 | 362 | 307 | 997 | 1,126 | ||||||||||||||
Average revenue per day | $ | 36,714 | $ | 34,785 | $ | 35,430 | $ | 38,226 | $ | 33,654 | |||||||||
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||||||||||||||
Reconciliation of Net Loss to Adjusted EBITDA | |||||||||||||||||||
and Consolidated Gross Margin | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||
September 30, | June 30, | September 30, | |||||||||||||||||
2019 | 2018 | 2019 | 2019 | 2018 | |||||||||||||||
Net loss as reported | $ | (26,016) | $ | (5,233) | $ | (12,944) | $ | (54,075) | $ | (34,524) | |||||||||
Depreciation and amortization | 22,924 | 23,501 | 22,851 | 68,428 | 70,535 | ||||||||||||||
Impairment | — | 239 | 332 | 1,378 | 2,607 | ||||||||||||||
Interest expense | 10,013 | 9,811 | 10,105 | 30,003 | 28,966 | ||||||||||||||
Income tax expense | 132 | 258 | 324 | 1,909 | 1,297 | ||||||||||||||
Adjusted EBITDA(1) | 7,053 | 28,576 | 20,668 | 47,643 | 68,881 | ||||||||||||||
General and administrative | 30,485 | 14,043 | 18,028 | 68,271 | 58,066 | ||||||||||||||
Bad debt expense (recovery), net | 196 | 111 | (348) | (90) | (311) | ||||||||||||||
Loss (gain) on dispositions of property and equipment, net | 17 | (1,861) | (1,126) | (2,184) | (2,922) | ||||||||||||||
Other expense (income) | 588 | (498) | (349) | (445) | (1,046) | ||||||||||||||
Consolidated gross margin | $ | 38,339 | $ | 40,371 | $ | 36,873 | $ | 113,195 | $ | 122,668 | |||||||||
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | |||||||
Reconciliation of Net Income (Loss) as Reported to Adjusted Net Income (Loss) | |||||||
and Diluted EPS as Reported to Adjusted (Diluted) EPS | |||||||
(in thousands, except per share data) | |||||||
(unaudited) | |||||||
Three months ended | |||||||
September 30, | June 30, | ||||||
2019 | 2019 | ||||||
Net loss as reported | $ | (26,016) | $ | (12,944) | |||
Impairment | — | 332 | |||||
Tax benefit related to adjustments | — | (77) | |||||
Valuation allowance adjustments on deferred tax assets | 2,465 | 884 | |||||
Adjusted net loss(2) | $ | (23,551) | $ | (11,805) | |||
Basic weighted average number of shares outstanding, as reported | 78,473 | 78,430 | |||||
Effect of dilutive securities | — | — | |||||
Diluted weighted average number of shares outstanding, as adjusted | 78,473 | 78,430 | |||||
Adjusted (diluted) EPS(3) | $ | (0.30) | $ | (0.15) | |||
Diluted EPS as reported | $ | (0.33) | $ | (0.17) | |||
(2) Adjusted net loss represents net loss as reported adjusted to exclude impairments and the related tax benefit and valuation allowance adjustments on deferred tax assets. We believe that adjusted net loss is a useful measure to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers, although it is not a measure of financial performance under GAAP. Adjusted net loss may not be comparable to other similarly titled measures reported by other companies. A reconciliation of net loss as reported to adjusted net loss is included in the table above. | |
(3) Adjusted (diluted) EPS represents adjusted net loss divided by the weighted-average number of shares outstanding during the period, including the effect of dilutive securities, if any. We believe that adjusted (diluted) EPS is a useful measure to facilitate period-to-period comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers, although it is not a measure of financial performance under GAAP. Adjusted (diluted) EPS may not be comparable to other similarly titled measures reported by other companies. A reconciliation of diluted EPS as reported to adjusted (diluted) EPS is included in the table above. | |
PIONEER ENERGY SERVICES CORP. AND SUBSIDIARIES | ||||||||
Equipment Information | ||||||||
As of October 31, 2019 | ||||||||
Multi-well, Pad-capable | ||||||||
Drilling Services Business Segments: | AC rigs | SCR rigs | Total | |||||
Domestic drilling | 17 | — | 17 | |||||
International drilling | — | 8 | 8 | |||||
25 | ||||||||
Production Services Business Segments: | 550 HP | 600 HP | Total | |||||
Well servicing rigs, by horsepower (HP) rating | 112 | 12 | 124 | |||||
Total | ||||||||
Wireline services units | 93 | |||||||
Coiled tubing services units | 9 | |||||||
SOURCE Pioneer Energy Services
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