Patterson Uti Energy Inc (PTEN) SEC Filing 10-Q Quarterly report for the period ending Monday, September 30, 2019

Exhibit 99.1

Contact: Mike Drickamer

Vice President, Investor Relations

Patterson-UTI Energy, Inc.

(281) 765-7170

Patterson-UTI Energy Reports Financial Results for the Three and Nine Months Ended September 30, 2019

HOUSTON, Texas – October 24, 2019 – PATTERSON-UTI ENERGY, INC. (NASDAQ: PTEN) today reported financial results for the three and nine months ended September 30, 2019.  The Company reported a net loss of $262 million, or $1.31 per share, for the third quarter of 2019, compared to a net loss of $75.0 million, or $0.34 per share, for the quarter ended September 30, 2018.  Excluding charges discussed below, the majority of which were non-cash, the net loss for the third quarter of 2019 would have been $52.9 million, or $0.27 per share.  Revenues for the third quarter of 2019 were $598 million, compared to $867 million for the third quarter of 2018.

Andy Hendricks, Patterson-UTI’s Chief Executive Officer, stated, “We exceeded our expectation for cash flow generation during the third quarter.   We reduced our capital expenditures and, excluding charges discussed below, Adjusted EBITDA for the third quarter exceeded capital expenditures by $74.9 million.  During the third quarter, we also reduced debt by $150 million, repurchased $75 million of our shares, and paid dividends totaling $7.8 million.”

For the nine months ended September 30, 2019, the Company reported a net loss of $340 million, or $1.65 per share, compared to a net loss of $120 million, or $0.55 per share, for the nine months ended September 30, 2018.  Revenues for the nine months ended September 30, 2019, were $2.0 billion, compared to $2.5 billion for the same period in 2018.  

Financial results for the three and nine months ended September 30, 2019, include pre-tax charges totaling $260 million ($209 million after-tax or $1.05 per share).  These charges include asset impairment charges of $203 million primarily in our drilling and pressure pumping segments, $17.8 million of goodwill impairment charges at our Current Power and Great Plains Oilfield Rental businesses, $17.0 million primarily related to the write-off of inventory at MS Directional, $14.6 million related to inventory write-offs and severance at our Warrior Rig Technologies business, and $8.2 million related to the early repayment of debt.  The financial results for the nine months ended September 30, 2019 also include charges in the second quarter, which included a $12.7 million charge to reduce the carrying value on our balance sheet of a deposit placed in 2017 on future sand purchases and $3.6 million of bad debt expense.  

During the third quarter, the Company spent $75.0 million to repurchase 8.2 million shares, which brings the total repurchases through the first three quarters of 2019 to $225 million for 20.0 million shares under the Company’s share repurchase program.  At September 30, 2019, $175 million remained under the Company’s share repurchase authorization.  

Mr. Hendricks added, “As expected, operators slowed spending levels during the third quarter, which negatively impacted activity levels for both drilling and pressure pumping.  However, our rig count in the third quarter of 142 rigs was in line with our expectation.  We expect our rig count will stabilize near current levels and average 126 rigs for the fourth quarter, with some increase in the first quarter as operator budgets reset in 2020.

“Average rig revenue per operating day and average rig margin per day were $24,240 and $9,790, respectively, for the third quarter, both of which include the benefit of approximately $480 per operating day from $6.3 million of revenue from early contract terminations.  Average rig direct operating cost per operating day increased during the third quarter to $14,440 from $14,030 in the second quarter due to lower fixed cost absorption, and increases in items