Form 10-Q
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Independence Contract Drilling, Inc.
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(Exact name of registrant as specified in its charter)
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Delaware
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37-1653648
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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20475 State Highway 249, Suite 300
Houston, Texas
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77070
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(Address of principal executive offices)
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(Zip code)
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading symbol(s)
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Name of each exchange where registered
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Common Stock, $0.01 par value per share
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ICD
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New York Stock Exchange
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Large accelerated filer
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¨
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Accelerated filer
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x
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Non-accelerated filer
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¨ (Do not check if a smaller reporting company)
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Smaller reporting company
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x
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Emerging growth company
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¨
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
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Part I. FINANCIAL INFORMATION
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Part II. OTHER INFORMATION
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Inability to predict the duration or magnitude of the effects of the COVID-19 pandemic on our business, operations, and financial condition and when or if worldwide oil demand will stabilize and begin to improve;
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a decline in or substantial volatility of crude oil and natural gas commodity prices;
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a sustained decrease in domestic spending by the oil and natural gas exploration and production industry;
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fluctuation of our operating results and volatility of our industry;
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inability to maintain or increase pricing of our contract drilling services, or early termination of any term contract for which early termination compensation is not paid;
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our backlog of term contracts declining rapidly;
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•
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the loss of any of our customers, financial distress or management changes of potential customers or failure to obtain contract renewals and additional customer contracts for our drilling services;
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overcapacity and competition in our industry;
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an increase in interest rates and deterioration in the credit markets;
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our inability to comply with the financial and other covenants in debt agreements that we may enter into as a result of reduced revenues and financial performance;
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unanticipated costs, delays and other difficulties in executing our long-term growth strategy;
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the loss of key management personnel;
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new technology that may cause our drilling methods or equipment to become less competitive;
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•
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labor costs or shortages of skilled workers;
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the loss of or interruption in operations of one or more key vendors;
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•
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the effect of operating hazards and severe weather on our rigs, facilities, business, operations and financial results, and limitations on our insurance coverage;
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•
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increased regulation of drilling in unconventional formations;
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the incurrence of significant costs and liabilities in the future resulting from our failure to comply with new or existing environmental regulations or an accidental release of hazardous substances into the environment; and
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the potential failure by us to establish and maintain effective internal control over financial reporting.
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March 31, 2020
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December 31, 2019
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Assets
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Cash and cash equivalents
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$
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9,753
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$
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5,206
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Accounts receivable, net
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26,893
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35,834
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Inventories
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1,181
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2,325
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Assets held for sale
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5,014
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8,740
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Prepaid expenses and other current assets
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4,803
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4,640
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Total current assets
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47,644
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56,745
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Property, plant and equipment, net
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437,505
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457,530
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Other long-term assets, net
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2,754
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2,726
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Total assets
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$
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487,903
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$
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517,001
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Liabilities and Stockholders’ Equity
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Liabilities
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Current portion of long-term debt
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$
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3,268
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$
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3,685
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Accounts payable
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14,981
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22,674
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Accrued liabilities
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12,958
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16,368
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Merger consideration payable to an affiliate
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2,932
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3,022
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Current portion of contingent consideration
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2,814
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2,814
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Total current liabilities
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36,953
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48,563
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Long-term debt
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145,291
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134,941
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Deferred income taxes, net
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610
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652
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Other long-term liabilities
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1,198
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1,249
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Total liabilities
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184,052
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185,405
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Commitments and contingencies (Note 13)
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Stockholders’ equity
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Common stock, $0.01 par value, 50,000,000 shares authorized; 3,888,137 and 3,876,196 shares issued, respectively, and 3,809,548 and 3,812,050 shares outstanding, respectively
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38
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38
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Additional paid-in capital
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506,375
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505,831
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Accumulated deficit
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(198,649
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(170,426
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Treasury stock, at cost, 78,589 shares and 64,146 shares, respectively
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(3,913
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(3,847
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Total stockholders’ equity
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303,851
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331,596
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Total liabilities and stockholders’ equity
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$
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487,903
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$
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517,001
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Three Months Ended March 31,
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2020
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2019
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Revenues
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$
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38,494
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$
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60,358
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Costs and expenses
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Operating costs
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30,229
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39,333
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Selling, general and administrative
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3,761
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4,545
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Severance and merger-related expenses
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1,076
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1,081
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Depreciation and amortization
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11,516
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11,313
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Asset impairment (insurance recoveries), net
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16,619
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2,018
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(Gain) loss on disposition of assets, net
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(46
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3,220
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Total costs and expenses
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63,155
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61,510
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Operating loss
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(24,661
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(1,152
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)
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Interest expense
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(3,604
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(3,761
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Loss before income taxes
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(28,265
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(4,913
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Income tax benefit
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(42
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(2,540
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)
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Net loss
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$
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(28,223
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$
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(2,373
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)
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Loss per share:
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Basic and diluted
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$
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(7.53
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$
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(0.63
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Weighted average number of common shares outstanding:
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Basic and diluted
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3,750
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3,785
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Common Stock
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Shares
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Amount
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Additional Paid-in Capital
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Accumulated Deficit
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Treasury Stock
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Total Stockholders’ Equity
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Balances at December 31, 2018
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3,853,909
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$
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39
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$
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504,178
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$
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(109,638
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$
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(3,046
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$
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391,533
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Common stock issuance costs
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—
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—
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(177
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—
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—
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(177
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Stock-based compensation
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—
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—
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387
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—
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—
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387
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Net loss
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—
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—
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—
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(2,373
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—
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(2,373
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)
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Balances at March 31, 2019
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3,853,909
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$
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39
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$
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504,388
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$
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(112,011
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)
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$
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(3,046
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$
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389,370
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Three Months Ended March 31,
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2020
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2019
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Cash flows from operating activities
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Net loss
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$
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(28,223
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)
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$
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(2,373
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)
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Adjustments to reconcile net loss to net cash provided by operating activities
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Depreciation and amortization
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11,516
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11,313
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Asset impairment (insurance recoveries), net
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16,619
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2,018
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Stock-based compensation
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570
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387
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(Gain) loss on disposition of assets, net
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(46
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)
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3,220
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Deferred income taxes
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(42
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(2,540
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)
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Amortization of deferred financing costs
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204
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203
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Bad debt expense (recovery)
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16
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(45
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)
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Changes in operating assets and liabilities
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Accounts receivable
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8,925
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(105
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)
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Inventories
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(27
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(45
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)
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Prepaid expenses and other assets
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(462
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)
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843
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Accounts payable and accrued liabilities
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(5,959
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)
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(5,271
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)
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Net cash provided by operating activities
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3,091
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7,605
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Cash flows from investing activities
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Purchases of property, plant and equipment
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(9,139
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(10,832
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)
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Proceeds from the sale of assets
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628
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536
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Proceeds from insurance claims
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—
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1,000
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Collection of principal on note receivable
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145
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—
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Net cash used in investing activities
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(8,366
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)
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(9,296
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)
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Cash flows from financing activities
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Borrowings under Revolving Credit Facility
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11,038
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2,403
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Repayments under Revolving Credit Facility
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(38
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)
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—
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Common stock issuance costs
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—
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(177
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)
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Purchase of treasury stock
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(66
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)
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—
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RSUs withheld for taxes
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(26
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)
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—
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Financing costs paid under Term Loan Facility
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—
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(5
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)
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Financing costs paid under Revolving Credit Facility
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—
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(12
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)
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Payments for finance lease obligations
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(1,086
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)
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(216
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)
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Net cash provided by financing activities
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9,822
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|
|
1,993
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Net increase in cash and cash equivalents
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4,547
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|
|
302
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Cash and cash equivalents
|
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||||
Beginning of period
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5,206
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|
12,247
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End of period
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$
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9,753
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$
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12,549
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Three Months Ended March 31,
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(in thousands)
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2020
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2019
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Supplemental disclosure of cash flow information
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Cash paid during the period for interest
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$
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3,541
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|
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$
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3,514
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Supplemental disclosure of non-cash investing and financing activities
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Change in property, plant and equipment purchases in accounts payable
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$
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(5,285
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)
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$
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(1,753
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)
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Additions to property, plant and equipment through finance leases
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$
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55
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|
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$
|
520
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Extinguishment of finance lease obligations from sale of assets classified as finance leases
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$
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(204
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)
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$
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—
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Transfer of assets from held and used to held for sale
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$
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—
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$
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(2,285
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)
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1.
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Nature of Operations and Recent Events
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•
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Salary or compensation reductions for substantially all our employees, including members of executive management;
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•
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Suspension of all cash-based incentive compensation, including all members of executive management;
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•
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Reducing the number of executive management positions by two;
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•
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Reducing the number of directors from seven to five, which would become effective following director elections at our 2020 Annual Meeting of Stockholders currently scheduled to occur on June 12, 2020;
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Annual compensation reductions for our directors; and
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•
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Reducing headcount for non-field-based personnel by approximately 40%.
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2.
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Interim Financial Information
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3.
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Sidewinder Merger
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4.
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Leases
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(in thousands)
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Three Months Ended March 31, 2020
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Three Months Ended March 31, 2019
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Operating lease expense
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$
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149
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$
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125
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Short-term lease expense
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1,281
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|
1,193
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Variable lease expense
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134
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86
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Finance lease expense:
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Amortization of right-of-use assets
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$
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392
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$
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265
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Interest expense on lease liabilities
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195
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32
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Total finance lease expense
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587
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|
297
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Total lease expense
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$
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2,151
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$
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1,701
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(in thousands)
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Three Months Ended March 31, 2020
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Three Months Ended March 31, 2019
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Cash paid for amounts included in measurement of lease liabilities:
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Operating cash flows from operating leases
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$
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160
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$
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103
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Operating cash flows from finance leases
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$
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194
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|
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$
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32
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Financing cash flows from finance leases
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$
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1,086
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$
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216
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Right-of-use assets obtained or recorded in exchange for lease obligations:
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Operating leases
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$
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178
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$
|
955
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Finance leases
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$
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54
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$
|
520
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(in thousands)
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March 31, 2020
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December 31, 2019
|
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Operating leases:
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Other long-term assets, net
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$
|
1,095
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$
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1,033
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Accrued liabilities
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|
$
|
545
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$
|
475
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Other long-term liabilities
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|
1,198
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|
|
1,250
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|
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Total operating lease liabilities
|
|
$
|
1,743
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|
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$
|
1,725
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Finance leases:
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Property, plant and equipment
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$
|
13,774
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|
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$
|
14,375
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Accumulated depreciation
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(1,352
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)
|
|
(1,425
|
)
|
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Property, plant and equipment, net
|
|
$
|
12,422
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|
|
$
|
12,950
|
|
|
|
|
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|
||||
Current portion of long-term debt
|
|
$
|
3,268
|
|
|
$
|
3,685
|
|
Long-term debt
|
|
6,654
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|
|
7,472
|
|
||
Total finance lease liabilities
|
|
$
|
9,922
|
|
|
$
|
11,157
|
|
|
|
|
|
|
||||
Weighted-average remaining lease term
|
|
|
|
|
||||
Operating leases
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|
3.3 years
|
|
|
3.6 years
|
|
||
Finance leases
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2.5 years
|
|
|
2.7 years
|
|
||
|
|
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|
||||
Weighted-average discount rate
|
|
|
|
|
||||
Operating leases
|
|
8.00
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%
|
|
8.07
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%
|
||
Finance leases
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|
7.66
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%
|
|
7.64
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%
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(in thousands)
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Operating Leases
|
|
Finance Leases
|
||||
2020
|
$
|
505
|
|
|
$
|
2,861
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2021
|
616
|
|
|
3,661
|
|
||
2022
|
444
|
|
|
3,517
|
|
||
2023
|
370
|
|
|
164
|
|
||
2024
|
47
|
|
|
—
|
|
||
Thereafter
|
—
|
|
|
—
|
|
||
Total cash lease payment
|
1,982
|
|
|
10,203
|
|
||
Add: expected residual value
|
—
|
|
|
832
|
|
||
Less: imputed interest
|
(239
|
)
|
|
(1,113
|
)
|
||
Total lease liabilities
|
$
|
1,743
|
|
|
$
|
9,922
|
|
5.
|
Revenue from Contracts with Customers
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
2020
|
|
2019
|
||||
Dayrate drilling
|
$
|
34,478
|
|
|
$
|
56,451
|
|
Mobilization
|
1,541
|
|
|
1,260
|
|
||
Reimbursables
|
2,448
|
|
|
1,604
|
|
||
Early termination
|
27
|
|
|
—
|
|
||
Capital modification
|
—
|
|
|
10
|
|
||
Intangible
|
—
|
|
|
1,033
|
|
||
Total revenue
|
$
|
38,494
|
|
|
$
|
60,358
|
|
(in thousands)
|
March 31, 2020
|
|
December 31, 2019
|
||||
Receivables, which are included in “Accounts receivable, net”
|
$
|
26,752
|
|
|
$
|
35,378
|
|
Contract liabilities, which are included in “Accrued liabilities - deferred revenue”
|
$
|
(505
|
)
|
|
$
|
(311
|
)
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
2020
|
|
2019
|
||||
Revenue recognized that was included in contract liabilities at beginning of period
|
$
|
311
|
|
|
$
|
732
|
|
Increase in contract liabilities due to cash received, excluding amounts recognized as revenue
|
$
|
(505
|
)
|
|
$
|
(479
|
)
|
|
Year Ending December 31,
|
||||||||||||||
(in thousands)
|
2020
|
|
2021
|
|
2022
|
|
2023
|
||||||||
Revenue
|
$
|
505
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
6.
|
Financial Instruments and Fair Value
|
Level 1
|
Unadjusted quoted market prices for identical assets or liabilities in an active market;
|
Level 2
|
Quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets or liabilities; and
|
Level 3
|
Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
(in thousands)
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Term Loan Facility
|
$
|
130,000
|
|
|
$
|
62,559
|
|
|
$
|
130,000
|
|
|
$
|
138,567
|
|
Revolving Credit Facility
|
$
|
11,000
|
|
|
$
|
4,464
|
|
|
$
|
—
|
|
|
$
|
—
|
|
7.
|
Inventories
|
8.
|
Accrued Liabilities
|
(in thousands)
|
March 31, 2020
|
|
December 31, 2019
|
||||
Accrued salaries and other compensation
|
$
|
2,177
|
|
|
$
|
3,500
|
|
Insurance
|
2,007
|
|
|
2,861
|
|
||
Deferred revenues
|
505
|
|
|
701
|
|
||
Property and other taxes
|
2,569
|
|
|
4,716
|
|
||
Interest
|
3,104
|
|
|
3,244
|
|
||
Operating lease liability - current
|
545
|
|
|
475
|
|
||
Other (1)
|
2,051
|
|
|
871
|
|
||
|
$
|
12,958
|
|
|
$
|
16,368
|
|
9.
|
Long-term Debt
|
(in thousands)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Term Loan Facility due October 1, 2023
|
|
$
|
130,000
|
|
|
$
|
130,000
|
|
Revolving Credit Facility due October 1, 2023
|
|
11,000
|
|
|
—
|
|
||
Finance lease obligations
|
|
9,922
|
|
|
11,157
|
|
||
|
|
150,922
|
|
|
141,157
|
|
||
Less: current portion
|
|
(3,268
|
)
|
|
(3,685
|
)
|
||
Less: Term Loan Facility deferred financing costs
|
|
(2,363
|
)
|
|
(2,531
|
)
|
||
Long-term debt
|
|
$
|
145,291
|
|
|
$
|
134,941
|
|
10.
|
Stock-Based Compensation
|
|
Three Months Ended March 31, 2020
|
|||||
|
Options
|
|
Weighted
Average
Exercise
Price
|
|||
Outstanding at January 1, 2020
|
33,458
|
|
|
$
|
254.80
|
|
Granted
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Forfeited/expired
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2020
|
33,458
|
|
|
$
|
254.80
|
|
Exercisable at March 31, 2020
|
33,458
|
|
|
$
|
254.80
|
|
|
Three Months Ended March 31, 2020
|
|||||
|
Shares
|
|
Weighted
Average Grant-Date Fair Value Per Share |
|||
Outstanding at January 1, 2020
|
62,817
|
|
|
$
|
64.40
|
|
Granted
|
—
|
|
|
—
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2020
|
62,817
|
|
|
$
|
64.40
|
|
|
Three Months Ended March 31, 2020
|
|||||
|
RSUs
|
|
Weighted
Average Grant-Date Fair Value Per Share |
|||
Outstanding at January 1, 2020
|
44,439
|
|
|
$
|
59.71
|
|
Granted
|
62,534
|
|
|
11.98
|
|
|
Vested and converted
|
(9,561
|
)
|
|
38.80
|
|
|
Forfeited
|
(3,031
|
)
|
|
38.80
|
|
|
Outstanding at March 31, 2020
|
94,381
|
|
|
$
|
30.88
|
|
|
Three Months Ended March 31, 2020
|
|||||
|
RSUs
|
|
Weighted
Average Grant-Date Fair Value Per Share |
|||
Outstanding at January 1, 2020
|
23,480
|
|
|
$
|
33.90
|
|
Granted
|
24,854
|
|
|
12.50
|
|
|
Vested and converted
|
—
|
|
|
—
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2020
|
48,334
|
|
|
$
|
22.90
|
|
11.
|
Stockholders’ Equity and Earnings (Loss) per Share
|
|
Three Months Ended March 31,
|
||||||
(in thousands, except per share data)
|
2020
|
|
2019
|
||||
Net loss (numerator):
|
$
|
(28,223
|
)
|
|
$
|
(2,373
|
)
|
Loss per share:
|
|
|
|
||||
Basic and diluted
|
$
|
(7.53
|
)
|
|
$
|
(0.63
|
)
|
Shares (denominator):
|
|
|
|
||||
Weighted average common shares outstanding - basic
|
3,750
|
|
|
3,785
|
|
||
Weighted average common shares outstanding - diluted
|
3,750
|
|
|
3,785
|
|
12.
|
Income Taxes
|
13.
|
Commitments and Contingencies
|
14.
|
Related Parties
|
•
|
Salary or compensation reductions for substantially all our employees, including members of executive management;
|
•
|
Suspension of all cash-based incentive compensation, including all members of executive management;
|
•
|
Reducing the number of executive management positions by two;
|
•
|
Reducing the number of directors from seven to five, which would become effective following director elections at our 2020 Annual Meeting of Stockholders currently scheduled to occur on June 12, 2020;
|
•
|
Annual compensation reductions for our directors; and
|
•
|
Reducing headcount for non-field-based personnel by approximately 40%
|
•
|
Safety Performance. Maintaining a strong safety record is a critical component of our business strategy. We measure safety by tracking the total recordable incident rate for our operations. In addition, we closely monitor and measure compliance with our safety policies and procedures, including “near miss” reports and job safety analysis compliance. We believe our Risk-Based HSE management system provides the required control, yet needed flexibility, to conduct all activities safely, efficiently and appropriately.
|
•
|
Utilization. Rig utilization measures the percentage of time that our rigs are earning revenue under a contract during a particular period. We measure utilization by dividing the total number of Operating Days (defined below) for a rig by the total number of days the rig is available for operation in the applicable calendar period. A rig is available for operation commencing on the earlier of the date it spuds its initial well following construction or when it has been completed and is actively marketed. “Operating Days” represent the total number of days a rig is earning revenue under a contract, beginning when the rig spuds its initial well under the contract and ending with the completion of the rig’s demobilization.
|
•
|
Revenue Per Day. Revenue per day measures the amount of revenue that an operating rig earns on a daily basis during a particular period. We calculate revenue per day by dividing total contract drilling revenue earned during the applicable period by the number of Operating Days in the period. Revenues attributable to costs reimbursed by customers are excluded from this measure.
|
•
|
Operating Cost Per Day. Operating cost per day measures the operating costs incurred on a daily basis during a particular period. We calculate operating cost per day by dividing total operating costs during the applicable period by the number of Operating Days in the period. Operating costs attributable to costs reimbursed by customers and rig construction costs are excluded from this measure.
|
•
|
Operating Efficiency and Uptime. Maintaining our rigs’ operational efficiency is a critical component of our business strategy. We measure our operating efficiency by tracking each drilling rig’s unscheduled downtime on a daily, monthly, quarterly and annual basis.
|
|
Three Months Ended
|
||||||
(In thousands, except per share data)
|
March 31, 2020
|
|
March 31, 2019
|
||||
Revenues
|
$
|
38,494
|
|
|
$
|
60,358
|
|
Costs and expenses
|
|
|
|
||||
Operating costs
|
30,229
|
|
|
39,333
|
|
||
Selling, general and administrative
|
3,761
|
|
|
4,545
|
|
||
Severance and merger-related expenses
|
1,076
|
|
|
1,081
|
|
||
Depreciation and amortization
|
11,516
|
|
|
11,313
|
|
||
Asset impairment (insurance recoveries), net
|
16,619
|
|
|
2,018
|
|
||
Gain (loss) on disposition of assets, net
|
(46
|
)
|
|
3,220
|
|
||
Total cost and expenses
|
63,155
|
|
|
61,510
|
|
||
Operating loss
|
(24,661
|
)
|
|
(1,152
|
)
|
||
Interest expense
|
(3,604
|
)
|
|
(3,761
|
)
|
||
Loss before income taxes
|
(28,265
|
)
|
|
(4,913
|
)
|
||
Income tax benefit
|
(42
|
)
|
|
(2,540
|
)
|
||
Net loss
|
$
|
(28,223
|
)
|
|
$
|
(2,373
|
)
|
|
|
|
|
||||
Other financial and operating data
|
|
|
|
||||
Number of marketed rigs (end of period) (1)
|
29
|
|
|
32
|
|
||
Rig operating days (2)
|
1,738
|
|
|
2,728
|
|
||
Average number of operating rigs (3)
|
19.1
|
|
|
30.3
|
|
||
Rig utilization (4)
|
66.0
|
%
|
|
94.8
|
%
|
||
Average revenue per operating day (5)
|
$
|
19,823
|
|
|
$
|
20,755
|
|
Average cost per operating day (6)
|
$
|
14,648
|
|
|
$
|
13,302
|
|
Average rig margin per operating day
|
$
|
5,175
|
|
|
$
|
7,453
|
|
(1)
|
Number of marketed rigs as of March 31, 2020 decreased by three rigs as compared to the number of marketed rigs as of March 31, 2019 as a result of the removal of three rigs from our marketed fleet in the third quarter of 2019. Marketed rigs exclude idle rigs that will not be reactivated until upgrades or conversions are complete.
|
(2)
|
Rig operating days represent the number of days our rigs are earning revenue under a contract during the period, including days that standby revenues are earned.
|
(3)
|
Average number of operating rigs is calculated by dividing the total number of rig operating days in the period by the total number of calendar days in the period.
|
(4)
|
Rig utilization is calculated as rig operating days divided by the total number of days our drilling rigs are available during the applicable period.
|
(5)
|
Average revenue per operating day represents total contract drilling revenues earned during the period divided by rig operating days in the period. Excluded in calculating average revenue per operating day are revenues associated with the reimbursement of (i) out-of-pocket costs paid by customers of $4.0 million and $2.7 million during the three months ended March 31, 2020 and 2019, respectively, and (ii) revenues associated with the amortization of intangible revenue acquired in the Sidewinder merger of $1.0 million during the three months ended March 31, 2019.
|
(6)
|
Average cost per operating day represents operating costs incurred during the period divided by rig operating days in the period. The following costs are excluded in calculating average cost per operating day: (i) out-of-pocket costs reimbursed by customers of $4.0 million and $2.7 million during the three months ended March 31, 2020 and 2019,
|
•
|
disruption to our supply chain for equipment, supplies and materials essential to our business;
|
•
|
notices from customers or suppliers arguing that their non-performance under our contracts with them is permitted as a result of force majeure or other reasons;
|
•
|
reductions in our borrowing base under our revolving line of credit related to delayed customer payments and payment defaults associated with customer liquidity issues and bankruptcies;
|
•
|
a need to preserve liquidity, which could result in reductions or delays to planned maintenance capital expenditures or failure to pursue other business opportunities;
|
•
|
actions by the lenders under our revolving credit facility that additional borrowings will not be permitted as a result of the occurrence of a material adverse effect caused by the COVID-19 pandemic;
|
•
|
actions by the lenders under our term loan that additional borrowings pursuant to our $15 million term loan accordion will not be permitted as a result of the occurrence of a material adverse effect caused by the COVID-19 pandemic;
|
•
|
our ability to comply with minimum liquidity and springing fixed charge coverage ratio covenants contained in our credit facilities;
|
•
|
cybersecurity issues, as digital technologies may become more vulnerable and experience a higher rate of cyberattacks in the current environment of remote connectivity;
|
•
|
litigation risk and possible loss contingencies related to COVID-19 and its impact, including with respect to commercial contracts, employee matters and insurance arrangements;
|
•
|
additional reductions to our workforce to adjust to market conditions, including severance payments, retention issues, and an inability to hire employees when market conditions improve;
|
•
|
additional asset impairments, including an impairment of the carrying value of our assets as demand for our contract drilling services decreases;
|
•
|
infections and quarantining of our employees and the personnel of our customers, suppliers and other third parties in areas in which we operate; and
|
•
|
changes in the regulation of the production of hydrocarbons, such as the imposition of limitations on the production of oil and gas by states in our target markets or other jurisdictions, that may result in additional limits on demand for our contract drilling services.
|
|
Issuer Purchases of Equity Securities
|
||||||||||||
Period
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Program
|
|
Approximate Dollar Value of Shares That May Yet be Purchased Under the Program
|
||||||
January 1 - January 31
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
9,191,336
|
|
February 1 - February 29
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
9,191,336
|
|
March 1 - March 31
|
14,443
|
|
|
$
|
4.61
|
|
|
14,443
|
|
|
$
|
9,124,711
|
|
Total
|
14,443
|
|
|
$
|
4.61
|
|
|
14,443
|
|
|
$
|
9,124,711
|
|
Exhibit
Number
|
|
Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
101.CAL*
|
|
XBRL Calculation Linkbase Document
|
|
|
|
101.DEF*
|
|
XBRL Definition Linkbase Document
|
|
|
|
101.INS*
|
|
XBRL Instance Document
|
|
|
|
101.LAB*
|
|
XBRL Labels Linkbase Document
|
|
|
|
101.PRE*
|
|
XBRL Presentation Linkbase Document
|
|
|
|
101.SCH*
|
|
XBRL Schema Document
|
*
|
Filed with this report
|
|
INDEPENDENCE CONTRACT DRILLING, INC.
|
||
|
By:
|
/s/ J. Anthony Gallegos, Jr.
|
|
|
|
Name:
|
J. Anthony Gallegos, Jr.
|
|
|
Title:
|
President and Chief Executive Officer (Principal Executive Officer)
|
|
By:
|
/s/ Philip A. Choyce
|
|
|
|
Name:
|
Philip A. Choyce
|
|
|
Title:
|
Executive Vice President, Chief Financial Officer, Treasurer and Secretary (Principal Financial Officer)
|
|
By:
|
/s/ Michael J. Harwell
|
|
|
|
Name:
|
Michael J. Harwell
|
|
|
Title:
|
Vice President - Finance and Chief Accounting Officer (Principal Accounting Officer)
|
/s/ J. Anthony Gallegos, Jr.
|
J. Anthony Gallegos, Jr.
|
Chief Executive Officer
|
/s/ Philip A. Choyce
|
Philip A. Choyce
|
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ J. Anthony Gallegos, Jr.
|
J. Anthony Gallegos, Jr.
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Philip A. Choyce
|
Philip A. Choyce
|
Chief Financial Officer
|