Stockholders' Equity

9 Months Ended

Sep. 30, 2019

11. Stockholders’ Equity

Cash Dividends — The Company paid cash dividends during the nine months ended September 30, 2019 and 2018 as follows:

2019:	Per Share		Total
			(in thousands)
Paid on March 21, 2019	$	0.04	$	8,499
Paid on June 20, 2019		0.04		8,344
Paid on September 19, 2019		0.04		7,847
Total cash dividends	$	0.12		24,690

2018:	Per Share		Total
			(in thousands)
Paid on March 22, 2018	$	0.02	$	4,443
Paid on June 21, 2018		0.04		8,832
Paid on September 20, 2018		0.04		8,685
Total cash dividends	$	0.10	$	21,960

On October 23, 2019, the Company’s Board of Directors approved a cash dividend on its common stock in the amount of $0.04 per share to be paid on December 19, 2019 to holders of record as of December 5, 2019. The amount and timing of all future dividend payments, if any, are subject to the discretion of the Board of Directors and will depend upon business conditions, results of operations, financial condition, terms of the Company’s debt agreements and other factors.

On September 6, 2013, the Company’s Board of Directors approved a stock buyback program that authorized purchases of up to $200 million of the Company’s common stock in open market or privately negotiated transactions. On July 25, 2018, the Company’s Board of Directors approved an increase of the authorization under the stock buyback program to allow for $250 million of future share repurchases. On February 6, 2019, the Company’s Board of Directors approved another increase of the authorization under the stock buyback program to allow for $250 million of future share repurchases. On July 24, 2019, the Company’s Board of Directors approved another increase of the authorization under the stock buyback program to allow for $250 million of future share repurchases. All purchases executed to date have been through open market transactions. Purchases under the program are made at management’s discretion, at prevailing prices, subject to market conditions and other factors. Purchases may be made at any time without prior notice. There is no expiration date associated with the buyback program. As of September 30, 2019, the Company had remaining authorization to purchase approximately $175 million of the Company’s outstanding common stock under the stock buyback program. Shares of stock purchased under the buyback program are held as treasury shares.

The Company acquired shares of stock from employees during the first three quarters of 2019 that are accounted for as treasury stock. Certain of these shares were acquired to satisfy the exercise price and employees’ tax withholding obligation upon the exercise of stock options. The remainder of these shares was acquired to satisfy payroll withholding obligations upon the settlement of performance unit awards and the vesting of restricted stock and restricted stock units. These shares were acquired at fair market value. These acquisitions were made pursuant to the terms of the Patterson-UTI Energy, Inc. Amended and Restated 2014 Long-Term Incentive Plan (the “2014 Plan”) and not pursuant to the stock buyback program.

Treasury stock acquisitions during the nine months ended September 30, 2019 were as follows (dollars in thousands):

	Shares		Cost
Treasury shares at beginning of period		53,701,096	$	1,080,448
Purchases pursuant to stock buyback program		19,961,344		225,109
Acquisitions pursuant to long-term incentive plan		1,015,617		14,014
Other		31,013		371
Treasury shares at end of period		74,709,070	$	1,319,942

The reconciliation of changes in stockholders’ equity for the periods ended September 30, 2019 and 2018, are presented as follows (in thousands):

	For the nine months ended September 30, 2019

	Common Stock					Additional						Accumulated Other
	Number of					Paid-in			Retained			Comprehensive		Treasury
	Shares			Amount		Capital			Earnings			Income (Loss)		Stock			Total
Balance, December 31, 2018		267,316		$	2,673	$	2,827,154		$	1,753,557		$	2,487	$	(1,080,448	)	$	3,505,423
Net loss		—			—		—			(28,614	)		—		—			(28,614	)
Foreign currency translation adjustment		—			—		—			—			944		—			944
Vesting of restricted stock units		38			—		—			—			—		—			—
Forfeitures of restricted stock		(1	)		—		—			—			—		—			—
Stock-based compensation		—			—		9,338			—			—		—			9,338
Payment of cash dividends		—			—		—			(8,499	)		—		—			(8,499	)
Dividend equivalents		—			—		—			(110	)		—		—			(110	)
Purchase of treasury stock		—			—		—			—			—		(75,113	)		(75,113	)
Balance, March 31, 2019		267,353		$	2,673	$	2,836,492		$	1,716,334		$	3,431	$	(1,155,561	)	$	3,403,369
Net loss		—			—		—			(49,447	)		—		—			(49,447	)
Foreign currency translation adjustment		—			—		—			—			848		—			848
Exercise of stock options		700			7		9,212			—			—		—			9,219
Vesting of restricted stock units		739			8		(8	)		—			—		—			—
Forfeitures of restricted stock		(1	)		—		—			—			—		—			—
Stock-based compensation		—			—		11,050			—			—		—			11,050
Payment of cash dividends		—			—		—			(8,344	)		—		—			(8,344	)
Dividend equivalents		—			—		—			(126	)		—		—			(126	)
Purchase of treasury stock		—			—		—			—			—		(88,258	)		(88,258	)
Balance, June 30, 2019		268,791		$	2,688	$	2,856,746		$	1,658,417		$	4,279	$	(1,243,819	)	$	3,278,311
Net loss		—			—		—			(261,719	)		—		—			(261,719	)
Foreign currency translation adjustment		—			—		—			—			854		—			854
Vesting of restricted stock units		433			4		(4	)		—			—		—			—
Stock-based compensation		—			—		9,670			—			—		—			9,670
Payment of cash dividends		—			—		—			(7,847	)		—		—			(7,847	)
Dividend equivalents		—			—		—			(160	)		—		—			(160	)
Purchase of treasury stock		—			—		—			—			—		(76,123	)		(76,123	)
Balance, September 30, 2019		269,224		$	2,692	$	2,866,412		$	1,388,691		$	5,133	$	(1,319,942	)	$	2,942,986

	For the nine months ended September 30, 2018

	Common Stock					Additional						Accumulated Other
	Number of					Paid-in			Retained			Comprehensive			Treasury
	Shares			Amount		Capital			Earnings			Income (Loss)			Stock			Total
Balance, December 31, 2017		266,259		$	2,662	$	2,785,823		$	2,105,897		$	6,822		$	(918,711	)	$	3,982,493
Net loss		—			—		—			(34,417	)		—			—			(34,417	)
Foreign currency translation adjustment		—			—		—			—			(1,984	)		—			(1,984	)
Exercise of stock options		40			1		484			—			—			—			485
Stock-based compensation		—			—		9,365			—			—			—			9,365
Payment of cash dividends		—			—		—			(4,443	)		—			—			(4,443	)
Dividend equivalents		—			—		—			(30	)		—			—			(30	)
Purchase of treasury stock		—			—		—			—			—			(16,928	)		(16,928	)
Balance, March 31, 2018		266,299		$	2,663	$	2,795,672		$	2,067,007		$	4,838		$	(935,639	)	$	3,934,541
Net loss		—			—		—			(10,713	)		—			—			(10,713	)
Foreign currency translation adjustment		—			—		—			—			(1,530	)		—			(1,530	)
Issuance of common stock		381			4		(4	)		—			—			—			—
Vesting of restricted stock units		10			—		—			—			—			—			—
Forfeitures of restricted stock		(2	)		—		—			—			—			—			—
Stock-based compensation		—			—		9,907			—			—			—			9,907
Payment of cash dividends		—			—		—			(8,832	)		—			—			(8,832	)
Dividend equivalents		—			—		—			(83	)		—			—			(83	)
Purchase of treasury stock		—			—		—			—			—			(42,951	)		(42,951	)
Balance, June 30, 2018		266,688		$	2,667	$	2,805,575		$	2,047,379		$	3,308		$	(978,590	)	$	3,880,339
Net loss		—			—		—			(75,042	)		—			—			(75,042	)
Foreign currency translation adjustment		—			—		—			—			1,520			—			1,520
Vesting of restricted stock units		406			4		(4	)		—			—			—			—
Forfeitures of restricted stock		(4	)		—		—			—			—			—			—
Stock-based compensation		—			—		9,177			—			—			—			9,177
Payment of cash dividends		—			—		—			(8,685	)		—			—			(8,685	)
Dividend equivalents		—			—		—			(106	)		—			—			(106	)
Purchase of treasury stock		—			—		—			—			—			(51,776	)		(51,776	)
Balance, September 30, 2018		267,090		$	2,671	$	2,814,748		$	1,963,546		$	4,828		$	(1,030,366	)	$	3,755,427