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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2021

or

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

For the Transition Period from to

Commission File No. 001-34037

Commission Company Name: SUPERIOR ENERGY SERVICES INC

SUPERIOR ENERGY SERVICES, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

75-2379388

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

 

1001 Louisiana Street, Suite 2900

77002

Houston, TX

(Zip Code)

(Address of principal executive offices)

Registrant’s telephone number, including area code: (713) 654-2200

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

Title of each class

Trading symbol

Name of each exchange on which registered

None

N/A

None

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 x

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 x

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 x

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨ No x

The number of shares of the registrant’s Class A common stock outstanding on October 28, 2021 was 19,998,695.

The number of shares of the registrant’s Class B common stock outstanding on October 28, 2021 was 76,269.


1


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

Quarterly Report on Form 10-Q for

the Quarterly Period Ended June 30, 2021

TABLE OF CONTENTS

Page

PART I.

FINANCIAL INFORMATION

Item 1.

Unaudited Condensed Consolidated Financial Statements and Notes

Unaudited Condensed Consolidated Balance Sheets

3

Unaudited Condensed Consolidated Statements of Operations

4

Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)

6

Unaudited Condensed Consolidated Statements of Cash Flows

7

Unaudited Consolidated Statements of Changes in Stockholders' Equity (Deficit)

8

Notes to Unaudited Condensed Consolidated Financial Statements

9

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

38

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

46

Item 4.

Controls and Procedures

46

PART II.

OTHER INFORMATION

Item 1.

Legal Proceedings

48

Item 1A.

Risk Factors

48

Item 2.

Unregistered Sales of Equity Securities

48

Item 6.

Exhibits

49

SIGNATURES

50

 


2


PART I. FINANCIAL INFORMATION

Item 1. Unaudited Condensed Consolidated Financial Statements and Notes

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands, except share data)

(unaudited)

Successor

Predecessor

ASSETS

June 30, 2021

December 31, 2020

Current assets:

Cash and cash equivalents

$

205,748 

$

188,006 

Accounts receivable, net of allowance for doubtful accounts of $515 and $24,629 at
June 30, 2021 and December 31, 2020, respectively

171,480 

158,516 

Income taxes receivable

-

8,891 

Prepaid expenses

34,540 

31,793 

Inventory

86,064 

77,027 

Other current assets

7,762 

9,171 

Assets held for sale

170,194

242,104 

Total current assets

675,788

715,508 

Property, plant and equipment, net

455,079

408,107 

Operating lease right-of-use assets

30,755 

33,317 

Goodwill

-

138,677 

Notes receivable

74,370 

72,129 

Restricted cash

80,159 

80,179 

Intangible and other long-term assets, net

24,436 

53,162 

Total assets

$

1,340,587

$

1,501,079 

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current liabilities:

Accounts payable

$

60,735 

$

50,330 

Accrued expenses

115,069 

114,777 

Income taxes payable

4,829 

-

Liabilities held for sale

35,730 

46,376 

Total current liabilities

216,363 

211,483 

Decommissioning liabilities

171,744 

134,436 

Operating lease liabilities

21,353 

29,464 

Deferred income taxes

43,227 

5,288 

Other long-term liabilities

72,758 

123,261 

Total non-current liabilities

309,082 

292,449 

Liabilities Subject to Compromise

-

1,335,794 

Total liabilities

525,445 

1,839,726 

Stockholders’ equity (deficit):

Predecessor common stock $0.001 par value; Authorized - 25,000,000, Issued - 15,799,318, Outstanding - 14,826,906 at December 31, 2020

-

16 

Successor Class A common stock $0.01 par value; Authorized - 50,000,000 shares 19,998,695 shares issued and outstanding at June 30, 2021

200 

-

Successor Class B common stock $0.01 par value; Authorized - 2,000,000 shares 113,840 shares issued and 76,269 shares outstanding at June 30, 2021

1 

-

Class A Additional paid-in capital

902,486 

2,756,889 

Class B Additional paid-in capital

84 

-

Predecessor Treasury stock at cost, 972,412 shares at December 31, 2020

-

(4,290)

Accumulated other comprehensive loss, net

-

(67,947)

Accumulated deficit

(87,629)

(3,023,315)

Total stockholders’ equity (deficit)

815,142

(338,647)

Total liabilities and stockholders’ equity (deficit)

$

1,340,587

$

1,501,079 

See accompanying notes to unaudited condensed consolidated financial statements.

 

3


 

SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

Successor

Predecessor

For the Three Months Ended June 30, 2021

For the Three Months Ended June 30, 2020

Revenues:

Services

$

79,787

$

59,919

Rentals

53,238

51,758

Product sales

32,867

39,905

Total revenues

165,892

151,582

Costs and expenses:

Cost of services

54,176

47,685

Cost of rentals

24,750

19,307

Cost of sales

24,653

26,434

Cost of revenues (exclusive of depreciation, depletion, amortization and accretion)

103,579

93,426

Depreciation, depletion, amortization and accretion - services

28,384

11,483

Depreciation, depletion, amortization and accretion - rentals

18,940

9,761

Depreciation, depletion, amortization and accretion - sales

11,694

7,464

General and administrative expenses

32,308

55,528

Restructuring and other expense

7,438

-

Loss from operations

(36,451)

(26,080)

Other income (expense):

Interest income (expense), net

535

(24,757)

Other income:

2,570

821

Loss from continuing operations before income taxes

(33,346)

(50,016)

Income tax (expense) benefit

1,747

4,324

Net loss from continuing operations

(31,599)

(45,692)

Loss from discontinued operations, net of income tax

(19,400)

(19,414)

Net loss

$

(50,999)

$

(65,106)

Loss per share -basic and diluted

Loss from continuing operations

$

(1.58)

$

(3.08)

Loss from discontinued operations, net of income tax

(0.97)

(1.31)

Net loss

$

(2.55)

$

(4.39)

Weighted-average shares outstanding - basic and diluted

19,999

14,826

See accompanying notes to condensed consolidated financial statements.

 

 

4


SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

Successor

Predecessor

For the Period February 3, 2021 through June 30, 2021

For the Period January 1, 2021 through February 2, 2021

For the Six Months Ended June 30, 2020

Revenues:

Services

$

123,466

$

19,234

$

163,722

Rentals

84,552

14,434

141,085

Product sales

63,717

12,260

81,014

Total revenues

271,735

45,928

385,821

Costs and expenses:

Cost of services

95,478

15,080

122,867

Cost of rentals

34,949

5,876

50,234

Cost of sales

41,020

8,817

57,838

Cost of revenues (exclusive of depreciation, depletion, amortization and accretion)

171,447

29,773

230,939

Depreciation, depletion, amortization and accretion - services

44,748

3,500

25,831

Depreciation, depletion, amortization and accretion - rentals

30,841

2,627

22,266

Depreciation, depletion, amortization and accretion - sales

23,459

2,231

12,792

General and administrative expenses

50,746

11,052

114,804

Restructuring and other expenses

15,821

1,270

-

Reduction in value of assets

-

-

16,522

Loss from operations

(65,327)

(4,525)

(37,333)

Other income (expense):

Interest income (expense), net

747

202

(49,898)

Reorganization items, net

-

335,560

-

Other expense

(275)

(2,105)

(3,411)

Income (loss) from continuing operations before income taxes

(64,855)

329,132

(90,642)

Income tax (expense) benefit

6,032

(60,003)

14,160

Net income (loss) from continuing operations

(58,823)

269,129

(76,482)

Loss from discontinued operations, net of income tax

(28,806)

(352)

(68,088)

Net income (loss)

$

(87,629)

$

268,777

$

(144,570)

Income (loss) per share -basic

Net income (loss) from continuing operations

$

(2.94)

$

18.13

$

(5.18)

Loss from discontinued operations, net of income tax

(1.44)

(0.02)

(4.61)

Net income (loss)

$

(4.38)

$

18.11

$

(9.79)

Income (loss) per share - diluted:

Net income (loss) from continuing operations

$

(2.94)

$

18.05

$

(5.18)

Loss from discontinued operations, net of income tax

(1.44)

(0.02)

(4.61)

Net income (loss)

$

(4.38)

$

18.03

$

(9.79)

Weighted-average shares outstanding - basic

19,997