Helmerich & Payne(US:HP)2023-11-08 21:55Operational Performance - As of September 30, 2023, the North America Solutions segment had 233 available rigs, with 147 contracted, representing a utilization rate of approximately 63%[28] - The Offshore Gulf of Mexico segment had a total of 7 available rigs, with 4 contracted, indicating a utilization rate of about 57%[30] - The International Solutions segment reported 22 available rigs, with 13 contracted, resulting in a utilization rate of approximately 59%[34] - Revenue days for North America Solutions increased to 61,814 in 2023 from 59,672 in 2022, reflecting a growth of about 3.8% year-over-year[37] - The average active rigs in North America Solutions rose to 169 in 2023, compared to 163 in 2022, indicating a 3.7% increase[37] - The total revenue days for International Solutions increased significantly to 4,788 in 2023 from 3,036 in 2022, marking a growth of approximately 57.5%[37] - The company had 164 active rigs under contract as of September 30, 2023, compared to 192 and 137 rigs under contract in 2022 and 2021, respectively[60] - The company operates the largest super-spec fleet in the industry with 242 super-spec rigs as of September 30, 2023[56] Financial Performance - Operating revenues for the year ended September 30, 2023, were $2,872,421 thousand, a significant increase of 39.4% from $2,058,944 thousand in 2022[340] - The net income for the year ended September 30, 2023, was $434,100 thousand, compared to a net income of $6,953 thousand in 2022, indicating a substantial improvement[340] - The company reported an operating income of $561,889 thousand for the year ended September 30, 2023, compared to an operating income of $45,292 thousand in 2022[340] - Basic earnings per common share for 2023 were $4.18, a significant increase from $0.05 in 2022[340] - Comprehensive income for 2023 reached $438.2 million, compared to $15.1 million in 2022[341] - Net cash provided by operating activities was $833.7 million in 2023, up from $233.9 million in 2022[343] - Capital expenditures for 2023 totaled $395.5 million, an increase from $250.9 million in 2022[343] - Dividends paid in 2023 amounted to $201.5 million, compared to $107.4 million in 2022[343] - Cash and cash equivalents at the end of 2023 were $316.2 million, up from $269 million at the end of 2022[344] Market Position - As of September 30, 2023, the company held approximately 23.6% of the total market share in U.S. land drilling and 33.4% of the super-spec market share[40] - North America Solutions segment contributed approximately 87.7% ($2.5 billion) of consolidated operating revenues in fiscal year 2023, up from 86.8% ($1.8 billion) in 2022[42] - Offshore Gulf of Mexico segment accounted for approximately 4.5% ($130.2 million) of consolidated operating revenues in fiscal year 2023, down from 6.1% ($125.5 million) in 2022[44] - International Solutions segment contributed approximately 7.4% ($212.6 million) of consolidated operating revenues in fiscal year 2023, an increase from 6.6% ($136.1 million) in 2022[45] Strategic Initiatives - The company commenced operations in Australia in the fourth fiscal quarter of 2023, expanding its international footprint[25] - The company maintains a strategy focused on developing and commercializing technologies to enhance drilling efficiency and accuracy[24] - The company continues to develop automation solutions aimed at reducing variability and costs in the drilling process, enhancing wellbore quality and placement[58] - The company has reconfigured 68 FlexRig drilling rigs to super-spec walking rigs since introducing the first walking rig in 2017[56] Employee and Corporate Governance - The company had approximately 6,200 employees in the U.S. and 900 internationally as of September 30, 2023, with employee numbers fluctuating based on service demand[68] - The company maintains a strong commitment to employee training and development, focusing on safety, ethical conduct, and inclusive teamwork[72] - Employee benefits include medical, dental, and vision insurance, a 401(k) plan with company match, and educational assistance for pursuing degrees[83] - The company has implemented a diversity, equity, and inclusion program, including a DE&I Advisory Council and tracking of diversity data[78] Risk Management - The company’s drilling services demand is influenced by crude oil and natural gas prices, which have historically been volatile and difficult to predict[303] - The company’s operations in Argentina are subject to currency exchange risks, with a potential 10% decrease in the value of Argentine pesos resulting in a decrease of approximately $0.4 million in monetary assets[301] - The company is subject to various U.S. and foreign laws, including the U.S. Foreign Corrupt Practices Act, which could impact its operations if not complied with[89] Sustainability and Compliance - The company’s sustainability strategy focuses on emissions, diversity, and safety, utilizing data to understand its impacts[91] - The company has made required expenditures to comply with current and future regulatory requirements, with no significant anticipated changes to its competitive position or earnings for fiscal year 2024[90] Debt and Equity - The company reported a fixed rate of 2.90% on its outstanding debt of $550.0 million in senior unsecured notes as of September 30, 2023[306] - As of September 30, 2023, the fair value of the company's equity securities in ADNOC Drilling was $174.8 million, up from $147.4 million in the previous year[307] - The company has no outstanding borrowings under its revolving credit facility as of September 30, 2023[306] Asset Management - The consolidated balance sheets of Helmerich & Payne, Inc. show total assets of $4,381,956 thousand as of September 30, 2023, compared to $4,355,531 thousand in 2022, reflecting a slight increase[339] - The total current liabilities increased to $418,931 thousand in 2023 from $394,810 thousand in 2022, marking a rise of 6.1%[339] - The company’s long-term debt remained relatively stable at $545,144 thousand in 2023, compared to $542,610 thousand in 2022[339] - The company recognized a gain of $48.2 million in fiscal year 2023 related to customer reimbursement for lost or damaged drill pipe[406] Lease and Rental Obligations - Total lease costs for fiscal year 2023 amounted to $12.4 million, up from $11.2 million in 2022[414] - The operating lease commitments, including probable extensions, increased to $65.97 million in 2023 from $44.77 million in 2022[412] - Future minimum rental payments required under operating leases total $54.421 million, with $10.534 million due in 2024 and $21.391 million due thereafter[416] - A lease agreement was entered into for relocating the corporate headquarters to a new office space, resulting in a $17.6 million increase to right-of-use assets and lease liability[417]