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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Key Energy Services Inc | NYSE:KEG | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.266 | 0 | 01:00:00 |
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ý
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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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Delaware
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04-2648081
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(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
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1301 McKinney Street, Suite 1800, Houston, Texas
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77010
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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¨
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Accelerated filer
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ý
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
|
||
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Item 1A.
|
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
|
•
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conditions in the oil and natural gas industry, especially oil and natural gas prices and capital expenditures by oil and natural gas companies;
|
•
|
volatility in oil and natural gas prices;
|
•
|
our ability to implement price increases or maintain pricing on our core services;
|
•
|
risks that we may not be able to reduce, and could even experience increases in, the costs of labor, fuel, equipment and supplies employed in our businesses;
|
•
|
industry capacity;
|
•
|
asset impairments or other charges;
|
•
|
the periodic low demand for our services and resulting operating losses and negative cash flows;
|
•
|
our highly competitive industry as well as operating risks, which are primarily self-insured, and the possibility that our insurance may not be adequate to cover all of our losses or liabilities;
|
•
|
significant costs and potential liabilities resulting from compliance with applicable laws, including those resulting from environmental, health and safety laws and regulations, specifically those relating to hydraulic fracturing, as well as climate change legislation or initiatives;
|
•
|
our historically high employee turnover rate and our ability to replace or add workers, including executive officers and skilled workers;
|
•
|
our ability to incur debt or long-term lease obligations;
|
•
|
our ability to implement technological developments and enhancements;
|
•
|
severe weather impacts on our business, including from hurricane activity;
|
•
|
our ability to successfully identify, make and integrate acquisitions and our ability to finance future growth of our operations or future acquisitions;
|
•
|
our ability to achieve the benefits expected from disposition transactions;
|
•
|
the loss of one or more of our larger customers;
|
•
|
our ability to generate sufficient cash flow to meet debt service obligations;
|
•
|
the amount of our debt and the limitations imposed by the covenants in the agreements governing our debt, including our ability to comply with covenants under our debt agreements;
|
•
|
an increase in our debt service obligations due to variable rate indebtedness;
|
•
|
our inability to achieve our financial, capital expenditure and operational projections, including quarterly and annual projections of revenue, operating income and/or loss margin and our inaccurate assessment of future activity levels, customer demand, and pricing stability which may not materialize (whether for Key as a whole or for geographic regions and/or business segments individually);
|
•
|
our ability to respond to changing or declining market conditions;
|
•
|
our ability to maintain sufficient liquidity;
|
•
|
adverse impact of litigation; and
|
•
|
other factors affecting our business described in Part I “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended
December 31, 2017
, in Part II, “
Item 1A. Risk Factors
” in our Quarterly Report on Form 10-Q for the three-month period ended March 31, 2018 and in the other reports we file with the Securities and Exchange Commission.
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
September 30,
2018 |
|
December 31,
2017 |
||||
|
(unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
43,294
|
|
|
$
|
73,065
|
|
Restricted cash
|
—
|
|
|
4,000
|
|
||
Accounts receivable, net of allowance for doubtful accounts of $926
and $875, respectively
|
89,926
|
|
|
69,319
|
|
||
Inventories
|
18,112
|
|
|
20,942
|
|
||
Other current assets
|
13,942
|
|
|
19,477
|
|
||
Total current assets
|
165,274
|
|
|
186,803
|
|
||
Property and equipment
|
432,691
|
|
|
413,127
|
|
||
Accumulated depreciation
|
(145,085
|
)
|
|
(85,813
|
)
|
||
Property and equipment, net
|
287,606
|
|
|
327,314
|
|
||
Intangible assets, net
|
419
|
|
|
462
|
|
||
Other non-current assets
|
9,434
|
|
|
14,542
|
|
||
TOTAL ASSETS
|
$
|
462,733
|
|
|
$
|
529,121
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
18,444
|
|
|
$
|
13,697
|
|
Current portion of long-term debt
|
2,500
|
|
|
2,500
|
|
||
Other current liabilities
|
79,275
|
|
|
87,579
|
|
||
Total current liabilities
|
100,219
|
|
|
103,776
|
|
||
Long-term debt
|
241,585
|
|
|
243,103
|
|
||
Workers’ compensation, vehicular and health insurance liabilities
|
25,194
|
|
|
25,393
|
|
||
Other non-current liabilities
|
28,456
|
|
|
28,166
|
|
||
Commitments and contingencies
|
|
|
|
||||
Equity:
|
|
|
|
||||
Preferred stock, $0.01 par value; 10,000,000 authorized and one share issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value; 100,000,000 shares authorized, 20,297,359 and 20,217,641 outstanding
|
203
|
|
|
202
|
|
||
Additional paid-in capital
|
263,627
|
|
|
259,314
|
|
||
Retained deficit
|
(196,551
|
)
|
|
(130,833
|
)
|
||
Total equity
|
67,279
|
|
|
128,683
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
462,733
|
|
|
$
|
529,121
|
|
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
REVENUES
|
$
|
134,721
|
|
|
$
|
110,653
|
|
|
$
|
404,442
|
|
|
$
|
319,885
|
|
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Direct operating expenses
|
106,103
|
|
|
87,115
|
|
|
314,061
|
|
|
237,981
|
|
||||
Depreciation and amortization expense
|
21,808
|
|
|
21,114
|
|
|
62,881
|
|
|
63,325
|
|
||||
General and administrative expenses
|
23,925
|
|
|
37,168
|
|
|
71,353
|
|
|
98,498
|
|
||||
Impairment expense
|
—
|
|
|
—
|
|
|
—
|
|
|
187
|
|
||||
Operating loss
|
(17,115
|
)
|
|
(34,744
|
)
|
|
(43,853
|
)
|
|
(80,106
|
)
|
||||
Interest expense, net of amounts capitalized
|
8,708
|
|
|
8,090
|
|
|
25,425
|
|
|
23,672
|
|
||||
Other income, net
|
(213
|
)
|
|
(4,578
|
)
|
|
(1,972
|
)
|
|
(5,779
|
)
|
||||
Reorganization items, net
|
—
|
|
|
60
|
|
|
—
|
|
|
1,501
|
|
||||
Loss before income taxes
|
(25,610
|
)
|
|
(38,316
|
)
|
|
(67,306
|
)
|
|
(99,500
|
)
|
||||
Income tax benefit
|
1,750
|
|
|
96
|
|
|
1,588
|
|
|
1,238
|
|
||||
NET LOSS
|
$
|
(23,860
|
)
|
|
$
|
(38,220
|
)
|
|
$
|
(65,718
|
)
|
|
$
|
(98,262
|
)
|
Loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
$
|
(1.18
|
)
|
|
$
|
(1.90
|
)
|
|
$
|
(3.25
|
)
|
|
$
|
(4.89
|
)
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
20,252
|
|
|
20,106
|
|
|
20,234
|
|
|
20,101
|
|
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
NET LOSS
|
$
|
(23,860
|
)
|
|
$
|
(38,220
|
)
|
|
$
|
(65,718
|
)
|
|
$
|
(98,262
|
)
|
Other comprehensive income loss:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation loss
|
—
|
|
|
(1,257
|
)
|
|
—
|
|
|
(239
|
)
|
||||
COMPREHENSIVE LOSS
|
$
|
(23,860
|
)
|
|
$
|
(39,477
|
)
|
|
$
|
(65,718
|
)
|
|
$
|
(98,501
|
)
|
|
|
|
|
||||
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net loss
|
$
|
(65,718
|
)
|
|
$
|
(98,262
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization expense
|
62,881
|
|
|
63,325
|
|
||
Impairment expense
|
—
|
|
|
187
|
|
||
Bad debt expense
|
387
|
|
|
631
|
|
||
Accretion of asset retirement obligations
|
121
|
|
|
146
|
|
||
Loss from equity method investments
|
—
|
|
|
560
|
|
||
Amortization of deferred financing costs
|
357
|
|
|
358
|
|
||
Deferred income tax benefit
|
—
|
|
|
(27
|
)
|
||
Income on disposal of assets, net
|
(7,402
|
)
|
|
(26,987
|
)
|
||
Share-based compensation
|
4,582
|
|
|
11,581
|
|
||
Changes in working capital:
|
|
|
|
||||
Accounts receivable
|
(20,994
|
)
|
|
1,084
|
|
||
Other current assets
|
8,365
|
|
|
10,920
|
|
||
Accounts payable, accrued interest and accrued expenses
|
(4,392
|
)
|
|
(19,943
|
)
|
||
Share-based compensation liability awards
|
835
|
|
|
—
|
|
||
Other assets and liabilities
|
5,916
|
|
|
7,794
|
|
||
Net cash used in operating activities
|
(15,062
|
)
|
|
(48,633
|
)
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures
|
(28,521
|
)
|
|
(9,610
|
)
|
||
Proceeds from sale of assets
|
11,955
|
|
|
31,844
|
|
||
Net cash provided by (used in) investing activities
|
(16,566
|
)
|
|
22,234
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Repayments of long-term debt
|
(1,875
|
)
|
|
(1,875
|
)
|
||
Payment of deferred financing costs
|
—
|
|
|
(350
|
)
|
||
Repurchases of common stock
|
(271
|
)
|
|
(85
|
)
|
||
Proceeds from exercise of warrants
|
3
|
|
|
—
|
|
||
Net cash used in financing activities
|
(2,143
|
)
|
|
(2,310
|
)
|
||
Effect of changes in exchange rates on cash
|
—
|
|
|
(146
|
)
|
||
Net decrease in cash, cash equivalents and restricted cash
|
(33,771
|
)
|
|
(28,855
|
)
|
||
Cash, cash equivalents, and restricted cash, beginning of period
|
77,065
|
|
|
115,212
|
|
||
Cash, cash equivalents, and restricted cash, end of period
|
$
|
43,294
|
|
|
$
|
86,357
|
|
|
|
Nine Months Ended
|
||||||
|
|
September 30,
|
||||||
|
|
2018
|
|
2017
|
||||
Rig Services
|
|
$
|
227,913
|
|
|
$
|
184,026
|
|
Fishing and Rental Services
|
|
47,801
|
|
|
45,808
|
|
||
Coiled Tubing Services
|
|
60,513
|
|
|
27,005
|
|
||
Fluid Management Services
|
|
68,215
|
|
|
57,475
|
|
||
International
|
|
—
|
|
|
5,571
|
|
||
Total
|
|
$
|
404,442
|
|
|
$
|
319,885
|
|
|
COMMON STOCKHOLDERS
|
|
|
|||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Deficit
|
|
Total
|
|||||||||||
|
Number of Shares
|
|
Amount at Par
|
|
|
|||||||||||||
Balance at December 31, 2017
|
20,217
|
|
|
$
|
202
|
|
|
$
|
259,314
|
|
|
$
|
(130,833
|
)
|
|
$
|
128,683
|
|
Common stock purchases
|
—
|
|
|
—
|
|
|
(271
|
)
|
|
—
|
|
|
(271
|
)
|
||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Share-based compensation
|
80
|
|
|
1
|
|
|
4,581
|
|
|
—
|
|
|
4,582
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(65,718
|
)
|
|
(65,718
|
)
|
||||
Balance at September 30, 2018
|
20,297
|
|
|
$
|
203
|
|
|
$
|
263,627
|
|
|
$
|
(196,551
|
)
|
|
$
|
67,279
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Other current assets:
|
|
|
|
||||
Prepaid current assets
|
$
|
5,490
|
|
|
$
|
9,598
|
|
Reinsurance receivable
|
7,209
|
|
|
7,328
|
|
||
Other
|
1,243
|
|
|
2,551
|
|
||
Total
|
$
|
13,942
|
|
|
$
|
19,477
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Other non-current assets:
|
|
|
|
||||
Reinsurance receivable
|
$
|
7,605
|
|
|
$
|
7,768
|
|
Deposits
|
1,228
|
|
|
1,246
|
|
||
Other
|
601
|
|
|
5,528
|
|
||
Total
|
$
|
9,434
|
|
|
$
|
14,542
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Other current liabilities:
|
|
|
|
||||
Accrued payroll, taxes and employee benefits
|
$
|
16,304
|
|
|
$
|
19,874
|
|
Accrued operating expenditures
|
15,312
|
|
|
11,644
|
|
||
Income, sales, use and other taxes
|
8,881
|
|
|
12,151
|
|
||
Self-insurance reserve
|
26,693
|
|
|
26,761
|
|
||
Accrued interest
|
7,069
|
|
|
6,605
|
|
||
Accrued insurance premiums
|
12
|
|
|
4,077
|
|
||
Unsettled legal claims
|
3,381
|
|
|
4,747
|
|
||
Accrued severance
|
567
|
|
|
250
|
|
||
Other
|
1,056
|
|
|
1,470
|
|
||
Total
|
$
|
79,275
|
|
|
$
|
87,579
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Other non-current liabilities:
|
|
|
|
||||
Asset retirement obligations
|
$
|
8,972
|
|
|
$
|
8,931
|
|
Environmental liabilities
|
1,980
|
|
|
1,977
|
|
||
Accrued sales, use and other taxes
|
17,123
|
|
|
17,142
|
|
||
Other
|
381
|
|
|
116
|
|
||
Total
|
$
|
28,456
|
|
|
$
|
28,166
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Trademark:
|
|
|
|
||||
Gross carrying value
|
$
|
520
|
|
|
$
|
520
|
|
Accumulated amortization
|
(101
|
)
|
|
(58
|
)
|
||
Net carrying value
|
$
|
419
|
|
|
$
|
462
|
|
|
Weighted
average
remaining
amortization
period (years)
|
|
Expected amortization expense (in thousands)
|
||||||||||||||||||||||
|
Remainder
of 2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
||||||||||||||
Trademarks
|
7.3
|
|
$
|
14
|
|
|
$
|
58
|
|
|
$
|
58
|
|
|
$
|
58
|
|
|
$
|
58
|
|
|
$
|
58
|
|
|
|
|
|
||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Term Loan Facility due 2021
|
$
|
245,625
|
|
|
$
|
247,500
|
|
Unamortized debt issuance costs
|
(1,540
|
)
|
|
(1,897
|
)
|
||
Total
|
244,085
|
|
|
245,603
|
|
||
Less current portion
|
(2,500
|
)
|
|
(2,500
|
)
|
||
Long-term debt
|
$
|
241,585
|
|
|
$
|
243,103
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||
|
September 30, 2018
|
|
September 30, 2018
|
||
Term Loan Facility
|
12.59
|
%
|
|
12.34
|
%
|
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Interest income
|
$
|
(201
|
)
|
|
$
|
(182
|
)
|
|
$
|
(580
|
)
|
|
$
|
(534
|
)
|
Other
|
(12
|
)
|
|
(4,396
|
)
|
|
(1,392
|
)
|
|
(5,245
|
)
|
||||
Total
|
$
|
(213
|
)
|
|
$
|
(4,578
|
)
|
|
$
|
(1,972
|
)
|
|
$
|
(5,779
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Basic and Diluted EPS Calculation:
|
|
|
|
|
|
|
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(23,860
|
)
|
|
$
|
(38,220
|
)
|
|
$
|
(65,718
|
)
|
|
$
|
(98,262
|
)
|
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
20,252
|
|
|
20,106
|
|
|
20,234
|
|
|
20,101
|
|
||||
Basic and diluted loss per share
|
$
|
(1.18
|
)
|
|
$
|
(1.90
|
)
|
|
$
|
(3.25
|
)
|
|
$
|
(4.89
|
)
|
|
|
|
|
|
|
|
|
||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
September 30,
|
|
September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
RSUs
|
1,078
|
|
|
641
|
|
|
1,367
|
|
|
641
|
|
Stock options
|
159
|
|
|
645
|
|
|
163
|
|
|
645
|
|
Warrants
|
1,838
|
|
|
1,838
|
|
|
1,838
|
|
|
1,838
|
|
Total
|
3,075
|
|
|
3,124
|
|
|
3,368
|
|
|
3,124
|
|
As of and for the three months ended September 30, 2018
|
|||||||||||||||||||||||||||
|
Rig Services
|
|
Fishing and Rental Services
|
|
Coiled Tubing Services
|
|
Fluid Management Services
|
|
Functional
Support(2)
|
|
Reconciling
Eliminations
|
|
Total
|
||||||||||||||
Revenues from external customers
|
$
|
77,153
|
|
|
$
|
17,477
|
|
|
$
|
18,220
|
|
|
$
|
21,871
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
134,721
|
|
Intersegment revenues
|
183
|
|
|
621
|
|
|
—
|
|
|
328
|
|
|
—
|
|
|
(1,132
|
)
|
|
—
|
|
|||||||
Depreciation and amortization
|
8,212
|
|
|
6,012
|
|
|
1,403
|
|
|
5,262
|
|
|
919
|
|
|
—
|
|
|
21,808
|
|
|||||||
Other operating expenses
|
64,471
|
|
|
12,855
|
|
|
16,404
|
|
|
19,441
|
|
|
16,857
|
|
|
—
|
|
|
130,028
|
|
|||||||
Operating income (loss)
|
4,470
|
|
|
(1,390
|
)
|
|
413
|
|
|
(2,832
|
)
|
|
(17,776
|
)
|
|
—
|
|
|
(17,115
|
)
|
|||||||
Interest expense, net of amounts capitalized
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,708
|
|
|
—
|
|
|
8,708
|
|
|||||||
Income (loss) before income taxes
|
4,488
|
|
|
(1,378
|
)
|
|
413
|
|
|
(2,827
|
)
|
|
(26,306
|
)
|
|
—
|
|
|
(25,610
|
)
|
|||||||
Long-lived assets(1)
|
147,050
|
|
|
49,436
|
|
|
18,083
|
|
|
60,360
|
|
|
22,109
|
|
|
421
|
|
|
297,459
|
|
|||||||
Total assets
|
204,823
|
|
|
65,798
|
|
|
36,493
|
|
|
75,811
|
|
|
70,927
|
|
|
8,881
|
|
|
462,733
|
|
|||||||
Capital expenditures
|
5,602
|
|
|
1,891
|
|
|
563
|
|
|
433
|
|
|
2,859
|
|
|
—
|
|
|
11,348
|
|
(1)
|
Long-lived assets include fixed assets, intangibles and other non-current assets.
|
(2)
|
Functional Support is geographically located in the United States.
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
|
WTI Cushing Oil(1)
|
|
NYMEX Henry
Hub Natural Gas(1)
|
|
Average Baker
Hughes U.S. Land
Drilling Rigs(2)
|
|
Average AESC Well Service Active Rig Count(3)
|
||||||
2018:
|
|
|
|
|
|
|
|
|
||||||
First Quarter
|
|
$
|
62.91
|
|
|
$
|
3.08
|
|
|
951
|
|
|
1,220
|
|
Second Quarter
|
|
$
|
68.07
|
|
|
$
|
2.85
|
|
|
1,021
|
|
|
1,297
|
|
Third Quarter
|
|
$
|
69.69
|
|
|
$
|
2.93
|
|
|
1,032
|
|
|
1,337
|
|
|
|
|
|
|
|
|
|
|
||||||
2017:
|
|
|
|
|
|
|
|
|
||||||
First Quarter
|
|
$
|
51.60
|
|
|
$
|
3.02
|
|
|
729
|
|
|
1,128
|
|
Second Quarter
|
|
$
|
48.07
|
|
|
$
|
3.07
|
|
|
878
|
|
|
1,210
|
|
Third Quarter
|
|
$
|
48.18
|
|
|
$
|
2.95
|
|
|
927
|
|
|
1,206
|
|
Fourth Quarter
|
|
$
|
55.27
|
|
|
$
|
2.90
|
|
|
902
|
|
|
1,205
|
|
(1)
|
Represents the average of the monthly average prices for each of the periods presented. Source: EIA and Bloomberg
|
(2)
|
Source: www.bakerhughes.com
|
(3)
|
Source: www.aesc.net
|
|
|
Rig Hours
|
|
Trucking Hours
|
|
Key’s U.S.
Working Days(1)
|
|||||||||
2018:
|
|
U.S.
|
|
International
|
|
Total
|
|
|
|
|
|||||
First Quarter
|
|
175,232
|
|
|
—
|
|
|
175,232
|
|
|
214,194
|
|
|
63
|
|
Second Quarter
|
|
187,578
|
|
|
—
|
|
|
187,578
|
|
|
201,427
|
|
|
64
|
|
Third Quarter
|
|
180,943
|
|
|
—
|
|
|
180,943
|
|
|
184,310
|
|
|
63
|
|
Total 2018
|
|
543,753
|
|
|
—
|
|
|
543,753
|
|
|
599,931
|
|
|
190
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
2017:
|
|
|
|
|
|
|
|
|
|
|
|||||
First Quarter
|
|
165,968
|
|
|
2,462
|
|
|
168,430
|
|
|
179,215
|
|
|
64
|
|
Second Quarter
|
|
163,966
|
|
|
1,701
|
|
|
165,667
|
|
|
185,398
|
|
|
63
|
|
Third Quarter
|
|
161,725
|
|
|
2,937
|
|
|
164,662
|
|
|
197,319
|
|
|
63
|
|
Fourth Quarter
|
|
164,480
|
|
|
—
|
|
|
164,480
|
|
|
223,478
|
|
|
61
|
|
Total 2017
|
|
656,139
|
|
|
7,100
|
|
|
663,239
|
|
|
785,410
|
|
|
251
|
|
(1)
|
Key’s U.S. working days are the number of weekdays during the quarter minus national holidays.
|
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
REVENUES
|
$
|
134,721
|
|
|
$
|
110,653
|
|
|
$
|
404,442
|
|
|
$
|
319,885
|
|
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Direct operating expenses
|
106,103
|
|
|
87,115
|
|
|
314,061
|
|
|
237,981
|
|
||||
Depreciation and amortization expense
|
21,808
|
|
|
21,114
|
|
|
62,881
|
|
|
63,325
|
|
||||
General and administrative expenses
|
23,925
|
|
|
37,168
|
|
|
71,353
|
|
|
98,498
|
|
||||
Impairment expense
|
—
|
|
|
—
|
|
|
—
|
|
|
187
|
|
||||
Operating loss
|
(17,115
|
)
|
|
(34,744
|
)
|
|
(43,853
|
)
|
|
(80,106
|
)
|
||||
Interest expense, net of amounts capitalized
|
8,708
|
|
|
8,090
|
|
|
25,425
|
|
|
23,672
|
|
||||
Other income, net
|
(213
|
)
|
|
(4,578
|
)
|
|
(1,972
|
)
|
|
(5,779
|
)
|
||||
Reorganization items, net
|
—
|
|
|
60
|
|
|
—
|
|
|
1,501
|
|
||||
Loss before income taxes
|
(25,610
|
)
|
|
(38,316
|
)
|
|
(67,306
|
)
|
|
(99,500
|
)
|
||||
Income tax benefit
|
1,750
|
|
|
96
|
|
|
1,588
|
|
|
1,238
|
|
||||
NET LOSS
|
$
|
(23,860
|
)
|
|
$
|
(38,220
|
)
|
|
$
|
(65,718
|
)
|
|
$
|
(98,262
|
)
|
|
|
|
|
||||
|
Three Months Ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
Interest income
|
$
|
(201
|
)
|
|
$
|
(182
|
)
|
Other
|
(12
|
)
|
|
(4,396
|
)
|
||
Total
|
$
|
(213
|
)
|
|
$
|
(4,578
|
)
|
|
|
|
|
||||
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
Interest income
|
$
|
(580
|
)
|
|
$
|
(534
|
)
|
Other
|
(1,392
|
)
|
|
(5,245
|
)
|
||
Total
|
$
|
(1,972
|
)
|
|
$
|
(5,779
|
)
|
|
|
|
|
||||
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
Net cash used in operating activities
|
$
|
(15,062
|
)
|
|
$
|
(48,633
|
)
|
Cash paid for capital expenditures
|
(28,521
|
)
|
|
(9,610
|
)
|
||
Proceeds received from sale of fixed assets
|
11,955
|
|
|
31,844
|
|
||
Repayments of long-term debt
|
(1,875
|
)
|
|
(1,875
|
)
|
||
Payment of deferred financing costs
|
—
|
|
|
(350
|
)
|
||
Other financing activities, net
|
(268
|
)
|
|
(85
|
)
|
||
Effect of exchange rates on cash
|
—
|
|
|
(146
|
)
|
||
Net decrease in cash, cash equivalents and restricted cash
|
$
|
(33,771
|
)
|
|
$
|
(28,855
|
)
|
|
|
||
Year
|
Principal
Payments
|
||
2018
|
$
|
625
|
|
2019
|
2,500
|
|
|
2020
|
2,500
|
|
|
2021
|
240,000
|
|
|
Total principal payments
|
$
|
245,625
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
Period
|
|
Number of
Shares Purchased
|
|
Average Price
Paid per Share(1)
|
|||
July 1, Period to July 31, Period
|
|
—
|
|
|
$
|
—
|
|
August 1, Period to August 31, Period
|
|
—
|
|
|
—
|
|
|
September 1, Period to September 30, Period
|
|
20,610
|
|
|
13.17
|
|
|
Total
|
|
20,610
|
|
|
$
|
13.17
|
|
(1)
|
The price paid per share with respect to the tax withholding repurchases was determined using the closing prices on the applicable vesting date.
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
Exhibit No.
|
|
Description
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
31.1*
|
|
|
|
|
|
31.2*
|
|
|
|
|
|
32**
|
|
|
|
|
|
101*
|
|
Interactive Data File.
|
|
|
*
|
Filed herewith
|
|
|
**
|
Furnished herewith
|
Date:
|
November 7, 2018
|
|
|
By:
|
/s/ J. MARSHALL DODSON
|
|
|
|
|
|
|
J. Marshall Dodson
|
|
|
|
|
|
|
Senior Vice President and Chief Financial Officer
(As duly authorized officer and Principal Financial Officer)
|
1 Year Key Energy Services Chart |
1 Month Key Energy Services Chart |
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