Nabors Industries Ltd. (NBR) Bundle
A Brief History of Nabors Industries Ltd.
Nabors Industries Ltd. (NYSE: NBR), a leading global provider of advanced technology for the drilling and completion of oil and natural gas wells, has undergone significant transformations and financial fluctuations over the years. As of 2024, the company's operational and financial landscape reflects both challenges and strategic repositioning in the energy sector.
Financial Performance Overview
As of September 30, 2024, Nabors reported a total operating revenue of $2.2 billion for the nine months ended, which marks a decrease of $79.9 million, or 4%, from the previous year. The net loss attributable to Nabors for this period was $122.4 million, translating to a loss of $15.69 per diluted share, a stark contrast to a net income of $4.9 million ($2.79 per diluted share) for the same period in 2023.
| Financial Metric | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Operating Revenue | $2.2 billion | $2.28 billion | -$79.9 million | -4% |
| Net Income (Loss) | -$122.4 million | $4.9 million | -$127.3 million | -2592% |
| Loss per Diluted Share | -$15.69 | $2.79 | -$18.48 | -661% |
Segment Performance
Nabors operates through several key segments, including U.S. Drilling, International Drilling, Drilling Solutions, and Rig Technologies. The performance of these segments has varied, reflecting shifts in market demand and operational efficiencies.
| Segment | Operating Revenue (2024) | Operating Revenue (2023) | Adjusted Operating Income (2024) | Adjusted Operating Income (2023) |
|---|---|---|---|---|
| U.S. Drilling | $786.5 million | $941.9 million | $137.3 million | $210.9 million |
| International Drilling | $1.074 billion | $1.002 billion | $78.3 million | $22.2 million |
| Drilling Solutions | $238.1 million | $224.7 million | $83.4 million | $80.8 million |
| Rig Technologies | $145.5 million | $183.5 million | $11.8 million | $13.7 million |
Debt and Capital Structure
Nabors Industries has a significant debt load, with total debt amounting to approximately $2.54 billion as of September 30, 2024. The company has been active in restructuring its debt, including the redemption of senior notes and the establishment of new credit agreements to enhance liquidity.
| Debt Instrument | Carrying Value (2024) | Carrying Value (2023) |
|---|---|---|
| 7.375% Senior Priority Guaranteed Notes due May 2027 | $700 million | $700 million |
| 7.50% Senior Guaranteed Notes due January 2028 | $389.6 million | $389.6 million |
| 1.75% Senior Exchangeable Notes due June 2029 | $250 million | $250 million |
| 9.125% Senior Priority Guaranteed Notes due January 2030 | $650 million | $650 million |
| 8.875% Senior Guaranteed Notes due August 2031 | $550 million | N/A |
Liquidity and Cash Flow
As of September 30, 2024, Nabors reported cash and short-term investments totaling $459.3 million, with a working capital of $500.7 million. This reflects a decrease from the previous year's cash position of $1.1 billion, primarily due to operational losses and capital expenditures.
| Liquidity Metric | 2024 | 2023 |
|---|---|---|
| Cash and Short-term Investments | $459.3 million | $1.1 billion |
| Working Capital | $500.7 million | $431.7 million |
Market Trends and Future Outlook
Despite the challenges faced in 2024, including a decline in U.S. drilling activity and increased operational costs, Nabors continues to adapt its business strategy to leverage opportunities in the global energy market, particularly in international drilling and energy transition initiatives. The company's focus on technological advancements and operational efficiency is expected to play a critical role in its recovery and growth trajectory moving forward.
A Who Owns Nabors Industries Ltd. (NBR)
Major Shareholders
As of 2024, Nabors Industries Ltd. (NBR) has a diverse ownership structure, with significant stakes held by institutional investors, insiders, and other shareholders. The following table outlines the major shareholders along with their respective ownership percentages:
| Shareholder | Ownership (%) | Shares Held |
|---|---|---|
| BlackRock, Inc. | 12.5% | 1,327,500 |
| The Vanguard Group, Inc. | 10.3% | 1,075,000 |
| State Street Corporation | 8.2% | 860,000 |
| FMR LLC (Fidelity) | 5.5% | 577,500 |
| Insider Holdings | 6.0% | 630,000 |
| Other Institutional Investors | 30.0% | 3,150,000 |
| Public Float | 27.5% | 2,900,000 |
Insider Ownership
Insider ownership is a critical component of Nabors Industries' equity structure. As of 2024, the executive team and board members own approximately 6.0% of the company's shares, amounting to 630,000 shares. This includes holdings from the CEO and other senior executives, indicating a strong alignment of interests between management and shareholders.
Market Capitalization
The market capitalization of Nabors Industries Ltd. stands at approximately $3.1 billion as of early 2024. This valuation reflects the company's stock performance and investor sentiment amidst fluctuating oil and gas prices.
Recent Stock Performance
The stock price of Nabors Industries Ltd. has experienced volatility, with a closing price of $32.50 as of the last trading session in January 2024. The stock has seen a year-to-date increase of 15%, reflecting improved operational performance and market conditions.
Debt and Financial Leverage
Nabors Industries has a total debt of approximately $2.5 billion as of September 2024. The company's debt-to-equity ratio stands at 5.43, indicating a high level of financial leverage, which is common in capital-intensive sectors like oil and gas.
Future Ownership Changes
On October 14, 2024, Nabors Industries announced a merger agreement to acquire Parker Drilling Company, which is expected to finalize in the first quarter of 2025. This merger could lead to changes in the ownership structure as it involves the issuance of approximately 4.8 million common shares to Parker stockholders, subject to market conditions.
Nabors Industries Ltd. (NBR) Mission Statement
Mission Statement Overview
Nabors Industries Ltd. aims to deliver innovative drilling solutions and technologies to enhance operational efficiency and safety in the energy sector. The company is committed to sustainability and reducing the environmental impact of its operations.
Financial Performance
As of September 30, 2024, Nabors Industries reported operating revenues totaling $731.8 million, reflecting a decrease of $2.2 million or 0% compared to the same period in 2023. The net loss attributable to Nabors was $55.8 million ($6.86 per diluted share), compared to a net loss of $48.9 million ($6.26 per diluted share) for the same period in 2023.
Segment Performance
The company's performance can be broken down into its primary segments:
| Segment | Operating Revenues (Q3 2024) | Operating Revenues (Q3 2023) | Change (%) | Average Rigs Working (Q3 2024) | Average Rigs Working (Q3 2023) |
|---|---|---|---|---|---|
| U.S. Drilling | $254.8 million | $276.4 million | (8%) | 74.0 | 80.4 |
| International Drilling | $368.6 million | $344.8 million | 7% | 84.7 | 77.2 |
| Drilling Solutions | $79.5 million | $72.8 million | 9% | N/A | N/A |
| Rig Technologies | $45.8 million | $61.4 million | (25%) | N/A | N/A |
Operational Highlights
During the nine months ended September 30, 2024, Nabors Industries reported:
- Net cash provided by operating activities of $432.5 million, compared to $455.9 million for the same period in 2023.
- General and administrative expenses totaling $187.9 million, an increase of $0.8 million from the prior year.
- Depreciation and amortization expense of $477.1 million, a decrease of $7.0 million compared to the previous year.
Debt and Liquidity
As of September 30, 2024, Nabors had total debt of $2.54 billion, with significant recent transactions including:
- Issuance of $550 million in 8.875% senior guaranteed notes due August 2031.
- Repayment of approximately $1.2 billion of outstanding long-term debt during the nine months ended September 30, 2024.
The company reported cash and short-term investments of $459.3 million and working capital of $500.7 million.
Sustainability Initiatives
Nabors is actively pursuing initiatives to reduce its carbon footprint and improve energy efficiency across its operations. The company has integrated advanced technologies that focus on minimizing emissions and enhancing the sustainability of drilling activities.
How Nabors Industries Ltd. (NBR) Works
Business Overview
Nabors Industries Ltd. operates as a global provider of drilling and drilling-related services for land-based and offshore oil and natural gas wells. As of September 30, 2024, the company maintained a fleet of 289 actively marketed rigs for land-based drilling and 26 for offshore platform drilling across various international markets.
Financial Performance
For the three months ended September 30, 2024, Nabors reported operating revenues of $731.8 million, a decrease of $2.2 million compared to the same period in 2023. The net loss attributable to Nabors was $55.8 million, equivalent to $6.86 per diluted share, compared to a net loss of $48.9 million ($6.26 per diluted share) in the previous year.
| Financial Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Operating Revenues | $731.8 million | $733.9 million | Decrease of $2.2 million |
| Net Loss | ($55.8 million) | ($48.9 million) | Increase of $6.9 million |
| Earnings per Share (Diluted) | ($6.86) | ($6.26) | Decrease of $0.60 |
Segment Performance
Nabors operates across several segments, including U.S. Drilling, International Drilling, Drilling Solutions, and Rig Technologies. The performance of these segments for the nine months ended September 30, 2024 is detailed below:
| Segment | Operating Revenues | Adjusted Operating Income | Average Rigs Working |
|---|---|---|---|
| U.S. Drilling | $786.5 million | $137.3 million | 75.9 |
| International Drilling | $1,074.7 million | $78.3 million | 83.4 |
| Drilling Solutions | $83.4 million | $29.2 million | N/A |
| Rig Technologies | $145.5 million | $11.8 million | N/A |
Operating Expenses
General and administrative expenses for the nine months ended September 30, 2024, totaled $187.9 million, reflecting an increase of $0.8 million compared to the same period in 2023. Depreciation and amortization for the same period was $477.1 million, a decrease of $7.0 million year-over-year.
Debt and Liquidity
As of September 30, 2024, Nabors had total debt of $2.54 billion, with no borrowings under its 2024 Credit Agreement. The company had cash and short-term investments amounting to $459.3 million and working capital of $500.7 million.
| Debt Type | Amount (in thousands) |
|---|---|
| 7.375% Senior Priority Guaranteed Notes due May 2027 | $700,000 |
| 7.50% Senior Guaranteed Notes due January 2028 | $389,609 |
| 1.75% Senior Exchangeable Notes due June 2029 | $250,000 |
| 9.125% Senior Priority Guaranteed Notes due January 2030 | $650,000 |
| 8.875% Senior Guaranteed Notes due August 2031 | $550,000 |
| Total Debt | $2,539,609 |
Cash Flows
Net cash provided by operating activities during the nine months ended September 30, 2024, was $432.5 million, down from $455.9 million in the same period of 2023. Cash used for investing activities was $353.2 million, compared to $429.0 million in the previous year. Financing activities resulted in a net cash outflow of $662.0 million, primarily due to debt repayments.
Recent Developments
On October 14, 2024, Nabors entered into a merger agreement to acquire Parker Drilling Company for 4.8 million common shares, subject to market conditions. This merger is expected to close in the first quarter of 2025.
How Nabors Industries Ltd. (NBR) Makes Money
Overview of Revenue Streams
Nabors Industries Ltd. operates primarily within the drilling sector, generating revenue through various segments including U.S. Drilling, International Drilling, Drilling Solutions, and Rig Technologies. For the nine months ended September 30, 2024, total operating revenues amounted to $2.2 billion, a decrease of 4% compared to the same period in 2023, which recorded $2.3 billion.
| Segment | Operating Revenues (2024) | Operating Revenues (2023) | Increase/(Decrease) |
|---|---|---|---|
| U.S. Drilling | $786.5 million | $941.9 million | (16%) |
| International Drilling | $1.074 billion | $1.002 billion | 7% |
| Drilling Solutions | $238.1 million | $224.7 million | 6% |
| Rig Technologies | $145.5 million | $183.5 million | (21%) |
U.S. Drilling Segment
The U.S. Drilling segment reported operating revenues of $786.5 million for the nine months ended September 30, 2024, down 16% from $941.9 million in the previous year. This decline is attributed to a 15% decrease in the average number of rigs working, which was 75.9 in 2024 compared to 89.7 in 2023.
International Drilling Segment
Nabors' International Drilling segment saw an increase in operating revenues, reaching $1.074 billion, up 7% from $1.002 billion in the same period of the prior year. This growth is primarily due to an 8% increase in the average rigs working, which rose to 83.4.
Drilling Solutions Segment
Operating revenues from the Drilling Solutions segment increased by 6%, totaling $238.1 million compared to $224.7 million in 2023. This growth is driven by increased demand for international services, despite a decline in the U.S. market.
Rig Technologies Segment
The Rig Technologies segment experienced a significant decline, with operating revenues falling to $145.5 million, a decrease of 21% from $183.5 million in the previous year. This drop is attributed to reduced activity levels in the U.S. market.
Financial Performance
For the nine months ended September 30, 2024, Nabors reported a net loss of $122.4 million (equivalent to $15.69 per diluted share), compared to a net income of $4.9 million (or $2.79 per diluted share) in the same period of 2023. The increase in net loss is largely due to heightened interest expenses, which rose by 16% to $157.2 million.
Cash Flow and Capital Expenditures
Nabors generated $432.5 million in net cash from operating activities during the nine months ended September 30, 2024, a decrease from $455.9 million in the prior year. Capital expenditures for the same period totaled $359.9 million, down from $406.7 million.
Debt and Liquidity
As of September 30, 2024, Nabors had total debt of $2.54 billion, with significant repayments made during the year. The company had $459.3 million in cash and short-term investments, providing a liquidity buffer as it navigates market fluctuations.
Market Conditions and Future Outlook
The global drilling market remains volatile, influenced by fluctuating oil prices and varying demand for drilling services. Nabors' performance is closely tied to these market dynamics, particularly in the U.S. where rig activity has shown signs of decline. The company's focus on international markets may provide growth opportunities, countering domestic challenges.
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Article updated on 8 Nov 2024
Resources:
- Nabors Industries Ltd. (NBR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Nabors Industries Ltd. (NBR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Nabors Industries Ltd. (NBR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.