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BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION | 12 Months Ended
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Sep. 30, 2019
Segment Reporting [Abstract] |
BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION | NOTE 17 BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION Description of the Business We are a global contract drilling services company based in Tulsa, Oklahoma with operations in all major U.S. onshore basins as well as South America and the Middle East. Our contract drilling services operations consist mainly of contracting Company-owned drilling equipment primarily to large oil and gas exploration companies. We are the recognized industry leader in drilling as well as technological innovation. Effective October 1, 2018, and during the fourth quarter of fiscal year 2019, we implemented organizational changes, consistent with the manner in which our chief operating decision maker evaluates performance and allocates resources. Effective October 1, 2018, technology reporting units previously reported in “Other” within our segment disclosures are now managed and presented within the new H&P Technologies reportable segment. As a result, beginning with the reporting of first quarter of fiscal year 2019, our operations are organized into the following reportable business segments: U.S. Land, Offshore, International Land and H&P Technologies. Additionally, during the fourth quarter of fiscal year 2019, we migrated our FlexApp offerings into our H&P Technologies segment. The activity of our FlexApps was previously included in our U.S. Land segment. Our real estate operations and our incubator program for new research and development projects are included in "Other". All segment disclosures have been restated, as practicable, for these segment changes. Consolidated revenues and expenses reflect the elimination of intercompany transactions. At September 30, 2019, our contract drilling services business includes the following reportable operating segments:
• | U.S. Land
• | Offshore
• | International Land
• | H&P Technologies
Each reportable operating segment is a strategic business unit that is managed separately, and consolidated revenues and expenses reflect the elimination of all material intercompany transactions. Other includes additional non-reportable operating segments. Revenues included in “Other” primarily consist of rental income. Segment Performance We evaluate segment performance based on income or loss from continuing operations (segment operating income) before income taxes which includes:
• | Revenues from external and internal customers
• | Direct operating costs
• | Depreciation and amortization
• | Allocated general and administrative costs
• | Asset impairment charges
but excludes corporate costs for other depreciation, income from asset sales, other corporate income and expense, and corporate assets. General and administrative costs are allocated to the segments based primarily on specific identification and, to the extent that such identification is not practical, on other methods which we believe to be a reasonable reflection of the utilization of services provided.
| September 30, 2019
(in thousands) | U.S. Land |  | Offshore |  | International Land |  | H&P Technologies |  | Other |  | Eliminations |  | Total
External Sales | $ | 2,366,201 |  |  | $ | 147,635 |  |  | $ | 211,731 |  |  | $ | 59,990 |  |  | $ | 12,933 |  |  | $ | — |  |  | $ | 2,798,490 |
Intersegment | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total Sales | 2,366,201 |  |  | 147,635 |  |  | 211,731 |  |  | 59,990 |  |  | 12,933 |  |  | — |  |  | 2,798,490 |
Segment Operating Income (Loss) | 93,088 |  |  | 19,594 |  |  | 5,366 |  |  | (12,190 | ) |  | 3,375 |  |  | — |  |  | 109,233 |
Depreciation and Amortization | 496,770 |  |  | 10,010 |  |  | 35,466 |  |  | 7,696 |  |  | 1,523 |  |  | — |  |  | 551,465 |
Total Assets | 5,099,583 |  |  | 102,442 |  |  | 217,094 |  |  | 184,558 |  |  | 32,532 |  |  | — |  |  | 5,636,209 |
| September 30, 2018
(in thousands) | U.S. Land (2) |  | Offshore |  | International Land |  | H&P Technologies (1) (2) |  | Other (1) |  | Eliminations |  | Total
External Sales | $ | 2,063,362 |  |  | $ | 142,500 |  |  | $ | 238,356 |  |  | $ | 30,239 |  |  | $ | 12,811 |  |  | — |  |  | 2,487,268 |
Intersegment | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  |  |  |  | — |
Total Sales | $ | 2,063,362 |  |  | $ | 142,500 |  |  | $ | 238,356 |  |  | $ | 30,239 |  |  | $ | 12,811 |  |  | — |  |  | 2,487,268 |
Segment Operating Income (Loss) | 148,251 |  |  | 26,124 |  |  | (683 | ) |  | (39,554 | ) |  | 5,883 |  |  | — |  |  | 140,021 |
Depreciation and Amortization | 504,805 |  |  | 10,392 |  |  | 46,826 |  |  | 7,153 |  |  | 1,486 |  |  | — |  |  | 570,662 |
Total Assets | 5,007,548 |  |  | 105,439 |  |  | 362,033 |  |  | 151,787 |  |  | 29,525 |  |  | — |  |  | 5,656,332 |
(1) | Prior period information has been restated to reflect the change in operating segments structure.
(2) | Prior period information has been restated to reflect the transfer of FlexApp revenue and the related costs from U.S. Land to H&P Technologies. Certain FlexApp revenue not separately priced in drilling contracts, and recorded in the U.S. Land segment, was impracticable to retrospectively quantify, and as such was not restated.
| September 30, 2017
(in thousands) | U.S. Land (2) |  | Offshore |  | International Land |  | H&P Technologies (1) (2) |  | Other (1) |  | Eliminations |  | Total
External Sales | $ | 1,437,427 |  |  | $ | 136,263 |  |  | $ | 212,972 |  |  | $ | 5,815 |  |  | $ | 12,264 |  |  | — |  |  | 1,804,741 |
Intersegment | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total Sales | $ | 1,437,427 |  |  | $ | 136,263 |  |  | $ | 212,972 |  |  | $ | 5,815 |  |  | $ | 12,264 |  |  | — |  |  | 1,804,741 |
Segment Operating Income (Loss) | (97,231 | ) |  | 24,201 |  |  | (7,224 | ) |  | (13,356 | ) |  | 6,065 |  |  | — |  |  | (87,545 | )
Depreciation and Amortization | 499,272 |  |  | 11,764 |  |  | 53,622 |  |  | 3,915 |  |  | 1,424 |  |  | — |  |  | 569,997 |
Total Assets | 4,962,808 |  |  | 99,533 |  |  | 413,392 |  |  | 110,468 |  |  | 26,883 |  |  | — |  |  | 5,613,084 |
(1) | Prior period information has been restated to reflect the change in operating segments structure.
(2) | Prior period information has been restated to reflect the transfer of FlexApp revenues and the related costs from U.S. Land to H&P Technologies. Certain FlexApp revenue not separately priced in a drilling contract, and recorded in the U.S. Land segment, was impracticable to retrospectively quantify, and as such was not restated.
The following table reconciles segment operating income (loss) to income from continuing operations before income taxes as reported on the Consolidated Statements of Operations:
| Year Ended September 30,
(in thousands) | 2019 |  | 2018 |  | 2017
|  |  | As adjusted, Note 2
Segment operating income (loss) | 109,233 |  |  | 140,021 |  |  | (87,545 | )
Gain on sale of assets | 39,691 |  |  | 22,660 |  |  | 20,627 |
Corporate depreciation | (11,338 | ) |  | (13,140 | ) |  | (15,546 | )
Corporate selling, general and administrative costs | (117,004 | ) |  | (116,577 | ) |  | (86,623 | )
Operating income (loss) from continuing operations | 20,582 |  |  | 32,964 |  |  | (169,087 | )
Other income (expense) |  |  |  |  |
Interest and dividend income | 9,468 |  |  | 8,017 |  |  | 5,915 |
Interest expense | (25,188 | ) |  | (24,265 | ) |  | (19,747 | )
Gain (loss) on investment securities | (54,488 | ) |  | 1 |  |  | — |
Other | (1,596 | ) |  | (876 | ) |  | (1,679 | )
Total unallocated amounts | (71,804 | ) |  | (17,123 | ) |  | (15,511 | )
Income (loss) from continuing operations before income taxes | $ | (51,222 | ) |  | $ | 15,841 |  |  | $ | (184,598 | )
The following table reconciles segment total assets to total assets as reported on the Consolidated Balance Sheets:
| Year Ended September 30,
(in thousands) | 2019 |  | 2018
Segment assets | $ | 5,636,209 |  |  | $ | 5,656,332 |
Corporate assets | 203,306 |  |  | 558,535 |
Total consolidated assets | $ | 5,839,515 |  |  | $ | 6,214,867 |
The following table presents revenues from external customers and long-lived assets by country based on the location of service provided:
| Year Ended September 30,
(in thousands) | 2019 |  | 2018 |  | 2017
Operating revenues |  |  |  |  |
United States | $ | 2,585,008 |  |  | $ | 2,247,400 |  |  | $ | 1,591,769 |
Argentina | 165,718 |  |  | 190,038 |  |  | 157,257 |
Colombia | 29,757 |  |  | 38,793 |  |  | 37,554 |
Ecuador | — |  |  | — |  |  | 6 |
Other Foreign | 18,007 |  |  | 11,037 |  |  | 18,155 |
Total | $ | 2,798,490 |  |  | $ | 2,487,268 |  |  | $ | 1,804,741 |
Property, plant and equipment, net |  |  |  |  |
United States | $ | 4,269,405 |  |  | $ | 4,591,913 |  |  | $ | 4,686,235 |
Argentina | 132,321 |  |  | 133,617 |  |  | 155,978 |
Colombia | 61,757 |  |  | 74,042 |  |  | 81,798 |
Ecuador | 12 |  |  | 10,781 |  |  | 22,298 |
Other Foreign | 38,589 |  |  | 47,029 |  |  | 54,742 |
Total | $ | 4,502,084 |  |  | $ | 4,857,382 |  |  | $ | 5,001,051 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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