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10-Q
SUPERIOR ENERGY SERVICES INC filed this Form 10-Q on 10/26/2016
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The following table compares our operating results for the three months ended September 30, 2016 and 2015 (in thousands, except percentages).  Cost of services and rentals excludes depreciation, depletion, amortization and accretion for each of our business segments







 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

Revenue

 

 

 

Cost of Services and Rentals



 

 

 

2016

 

2015

 

Change

 

 

 

2016

 

%

 

2015

 

%

 

Change

Drilling Products and     

  Services

 

 

 

$

63,570 

 

$

128,489 

 

$

(64,919)

 

-51%

 

$

30,137 

 

47% 

 

$

43,827 

 

34% 

 

$

(13,690)

Onshore Completion and

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 -

 

 

 

 

 

Workover Services

 

 

 

 

125,022 

 

 

202,912 

 

 

(77,890)

 

-38%

 

 

124,747 

 

100% 

 

 

174,429 

 

86% 

 

 

(49,682)

Production Services

 

 

 

 

73,540 

 

 

163,937 

 

 

(90,397)

 

-55%

 

 

62,818 

 

85% 

 

 

130,021 

 

79% 

 

 

(67,203)

Technical Solutions

 

 

 

 

64,093 

 

 

106,058 

 

 

(41,965)

 

-40%

 

 

40,466 

 

63% 

 

 

72,208 

 

68% 

 

 

(31,742)

Total

 

 

 

$

326,225 

 

$

601,396 

 

$

(275,171)

 

-46%

 

$

258,168 

 

79% 

 

$

420,485 

 

70% 

 

$

(162,317)



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



The following provides a discussion of our results on a segment basis:



Drilling Products and Services Segment



Revenue from our Drilling Products and Services segment decreased 51% to $63.6 million for the three months ended September 30, 2016, as compared to $128.5 million for the same period in 2015The decline in revenue in this segment is due to the low rig count, lower pricing and customer budget constraints. Cost of services and rentals as a percentage of revenue increased to 47% of segment revenue for the three months ended September 30, 2016, as compared to 34% for the same period in 2015, primarily due to a decrease in revenue.  Revenue from our Gulf of Mexico market area decreased 52%, revenue generated from our U.S. land market area decreased 54% and revenue from our international market area decreased 45%.    The decline in revenue in these market areas is primarily attributable to decreases in revenues from rentals of premium drill pipe, bottom hole assemblies and accommodation units, as demand for these rental products decreased along with the worldwide rig count. 



Onshore Completion and Workover Services Segment



Revenue from our Onshore Completion and Workover Services segment decreased 38% to $125.0 million for the three months ended September 30, 2016, as compared to $202.9 million for the same period in 2015.   All of this segment’s revenue is derived from the U.S. land market area, in which rig count was down 45%.  Cost of services and rentals as a percentage of revenues increased to 100% of segment revenue from 86% in the third quarter of 2015 primarily due to a  significant decrease in revenue.  The decrease in revenue is primarily due to a decline in activity and pricing for our services, primarily in our pressure pumping and fluid management businesses.  These services were impacted negatively by reduced customer spending and activity as well as continued pricing pressure in North America during the quarter.  During the three months ended September 30, 2015, we recorded $740.0 million in reduction in value of assets.  



Production Services Segment



Revenue from our Production Services segment for the three months ended September 30, 2016 decreased by 55% to $73.6 million, as compared to $163.9 million for the same period in 2015The decline in revenue in this segment is due to low rig count, lower pricing and customer budget constraints.    Cost of services and rentals as a percentage of revenue increased to 85% of segment revenue from 79% in the third quarter of 2015, primarily as a result of the decrease in revenueRevenue derived from the Gulf of Mexico market area increased 15% primarily due to increased activity in hydraulic workover and snubbing and well services.  Revenue from the U.S. land market area decreased 78% and revenue from international market areas decreased 39%, primarily due to decreased activity in hydraulic workover and snubbing operationsDuring the three months ended September 30, 2015, we recorded $15.6 million in reduction in value of assets.  

 

Technical Solutions Segment



Revenue from our Technical Solutions segment decreased 40% to $64.0 million for the three months ended September 30, 2016, as compared to $106.1 million for the same period in 2015.  The decline in revenue in this segment is due to low rig count, lower pricing and customer budget constraints. Cost of services and rentals as a percentage of revenue decreased to 63% of segment revenue from 68% in the third quarter of 2015Revenue derived from the Gulf of Mexico market area decreased 49%, primarily due to a decrease in demand for well control services and completion tools and products.  In addition, the decrease in revenue was also attributable to the discontinuation of our marine technical services business due to the termination of the contract with its customer.  Revenue from the U.S. land market area decreased 33% and revenue from the international market area decreased 21%, primarily due to a decrease in demand for completion tools and products.

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