OREANDA-NEWS. August 05, 2015.  Nabors Industries Ltd. ("Nabors") (NYSE: NBR) today reported second-quarter revenue and earnings from unconsolidated affiliates of \\$862 million, compared to \\$1.42 billion in the first quarter of 2015, and \\$1.62 billion in the second quarter of last year. The comparable quarters included \\$367 million and \\$535 million respectively, in revenue from Completion and Production Services, a business line that merged with C&J Energy Services on March 24, 2015.  Beginning in the second quarter, Nabors' results reflect equity-method accounting for this investment on a quarter-lag basis.OREANDA-NEWS. August 05, 2015.

Net income from continuing operations reported for the second quarter was a loss of \\$41.9 million or \\$0.14 per diluted share, which includes \\$0.23 of tax expense.  This compares to first-quarter net income from continuing operations of \\$124.4 million or \\$0.43 per diluted share; or \\$58.3 million, or \\$0.20 per share, after excluding \\$66.1 million attributable to the after-tax net gain from the C&J Energy Services transaction, tax benefits and after-tax severance charges from workforce reductions. The first-quarter comparable results also include income from the Completion and Production Services business.  

Anthony Petrello, Nabors' Chairman and CEO, commented, "Our second-quarter operating results, while down significantly, were better than we had anticipated.  This was largely attributable to a resilient international business and stringent cost control throughout the organization.  The sequential decrease was driven by: lower drilling activity in the U.S. Lower 48, rate concessions and slightly lower utilization internationally, seasonally lower activity in Canada and Alaska, and a depleting backlog in Canrig, partially offset by the initial contribution from six new rigs deployed during the quarter.  We continued to bolster the long-term future of the Company with a more streamlined cost structure and the purchase of our partners' interest in our Saudi Arabia entity.  Our ability to expand and extend our revolving credit facility in the middle of an industry downturn with a group of 17 global banks, 3 of which are new to the facility, is a testament to our banking group's confidence in our financial strength and future prospects.  

Segment Results

Adjusted income derived from operating activities ("operating income") in Drilling and Rig Services decreased 48% to \\$104.9 million from \\$201.3 million in the first quarter of this year.  Adjusted EBITDA in this unit was \\$323.6 million, primarily attributable to the International segment.  

International operating income decreased by 21% sequentially to \\$83.3 million, reflecting the impact of negotiated rate reductions.  Going forward, the Company still foresees the potential for further declines in its international rig count and average margins as the effects of weak oil prices progressively influence the international market.  Despite the softening conditions, full-year results for the International segment are still expected to increase compared to 2014.

In North America, drilling activity within the U.S. Drilling and Canada segments declined significantly throughout the quarter, resulting in decreases in operating income of \\$45.6 million and \\$14.6 million, respectively.  In the Lower 48, activity declined throughout the quarter with 33 contracted rigs expiring.  Although the decline in U.S. activity appears to be bottoming, oil price risk remains and lower income is expected as contracts expire and reprice at lower rates.  Results in Canada and Alaska declined seasonally.  In the U.S. Gulf of Mexico the Company's new deepwater platform rig received a reduced mobilization dayrate throughout the quarter.  However, the commencement of its full operating rate has been delayed for an indefinite period of time due to issues with the installation of the customer's platform. 

Rig Services, which consists of the Company's manufacturing and directional drilling operations, reported negative operating income of \\$1.6 million, as the industry's newbuild activity and drilling activity has declined.

Financial Discussion

The second quarter included several items that impacted the operational results of the Company.  First, the results of the Saudi Arabia joint venture will now be reported on a consolidated basis due to the purchase of the partner's interest by Nabors in May 2015. Second, the International segment results were negatively impacted by \\$5 million related to a customer bankruptcy in Latin America. Finally, the Company is now recording its proportionate share of C&J Energy Services earnings with a one-quarter lag.  Accordingly, second-quarter results included a loss of \\$0.8 million related to the Company's ownership stake in C&J Energy Services during the first quarter of this year, beginning March 24, 2015.

Income tax expense in the second quarter exceeded the Company's income before taxes due to the true-up of the Company's year-to-date tax provision to the full-year expected tax rate. Accordingly, the second quarter's tax rate is not representative of the full year anticipated rate and the Company currently expects a tax benefit for the third quarter and full year.

William Restrepo, Nabors' Chief Financial Officer, stated, "Nabors plans to emerge from the current market in a stronger competitive position and has several initiatives underway to achieve this objective.  Our SG&A and purchasing efforts are already yielding significant results.  Likewise, we remain focused on cost control and capital expenditure discipline.  We are committed to free cash flow generation and intend to exit the downturn with a more modern and capable fleet; a focused, streamlined, more effective organization; and a stronger balance sheet with more financial flexibility."

Summary and Outlook

Petrello concluded, "Looking ahead, although we expect the third quarter to reflect another decrease in our results, we also believe it may represent the bottom in most areas outside of the U.S. Lower 48.  New rig startups internationally combined with fourth quarter seasonal upticks in Alaska and Canada should serve to mitigate some of the impact of further pricing erosion in the U.S. Lower 48 as contracts continue to roll to lower spot-market pricing.  We believe it is likely that current market conditions will prevail for an extended period, particularly in North America. While our international markets will be more resilient, especially in the Middle East and North Africa, we will remain diligent in our cost-containment efforts.  For the full year, we still expect to achieve substantially higher results in our International and Alaska operations compared to 2014."

About Nabors

The Nabors companies own and operate approximately 469 land drilling rigs throughout the world. Nabors' actively marketed offshore fleet consists of six jackups and 36 platform rigs in the United States and multiple international markets. Nabors also manufactures top drives and drilling instrumentation systems.  Nabors participates in most of the significant oil and gas markets in the world.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such forward-looking statements are subject to certain risks and uncertainties, as disclosed by Nabors from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, Nabors' actual results may differ materially from those indicated or implied by such forward-looking statements.  The projections contained in this release reflect management's estimates as of the date of the release.  Nabors does not undertake to update these forward-looking statements.  

Media Contact:

Dennis A. Smith, Director of Corporate Development & Investor Relations, +1 281-775-8038.  To request investor materials, contact Nabors' corporate headquarters in Hamilton, Bermuda at +441-292-1510 or via e-mail at mark.andrews@nabors.com

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(Unaudited)













Three Months Ended

Six Months Ended


June 30,

March 31,

June 30,











(In thousands, except per share amounts)

2015

2014

2015

2015

2014











Revenues and other income:









   Operating revenues 

\\$ 863,305

\\$ 1,616,981

\\$ 1,414,707

\\$ 2,278,012

\\$ 3,206,599

   Earnings (losses) from unconsolidated affiliates

(1,116)

(576)

6,502

5,386

(3,021)

   Investment income (loss)

1,181

7,066

969

2,150

8,046

      Total revenues and other income

863,370

1,623,471

1,422,178

2,285,548

3,211,624











Costs and other deductions:









   Direct costs 

488,522

1,066,495

919,610

1,408,132

2,128,234

   General and administrative expenses

86,290

133,630

127,133

213,423

267,896

   Depreciation and amortization

218,196

282,820

281,019

499,215

564,947

   Interest expense

44,469

46,303

46,601

91,070

91,113

   Losses (gains) on sales and disposals of 









     long-lived assets and other expense (income), net

1,338

16,504

(55,842)

(54,504)

17,980

      Total costs and other deductions

838,815

1,545,752

1,318,521

2,157,336

3,070,170











Income (loss) from continuing operations before income taxes

24,555

77,719

103,657

128,212

141,454











Income tax expense (benefit)

66,445

10,756

(20,705)

45,740

24,764











Subsidiary preferred stock dividend

-

1,234

-

-

1,984











Income (loss) from continuing operations, net of tax

(41,890)

65,729

124,362

82,472

114,706

Income (loss) from discontinued operations, net of tax

5,025

(1,032)

(817)

4,208

483











Net income (loss)

(36,865)

64,697

123,545

86,680

115,189

     Less: Net (income) loss attributable to noncontrolling interest

44

(253)

89

133

(826)

Net income (loss) attributable to Nabors

\\$ (36,821)

\\$      64,444

\\$    123,634

\\$      86,813

\\$    114,363











Earnings (losses) per share: (1)









   Basic from continuing operations

\\$        (.14)

\\$             .21

\\$             .43

\\$             .28

\\$             .37

   Basic from discontinued operations

.01

-

-

.02

-

   Basic

\\$        (.13)

\\$             .21

\\$             .43

\\$             .30

\\$             .37











   Diluted from continuing operations

\\$        (.14)

\\$             .21

\\$             .43

\\$             .28

\\$             .37

   Diluted from discontinued operations

.01

-

(.01)

.02

-

   Diluted

\\$        (.13)

\\$             .21

\\$             .42

\\$             .30

\\$             .37

































Weighted-average number of common shares outstanding: (1)









   Basic 

286,085

297,984

285,361

285,723

297,097

   Diluted 

286,085

300,981

286,173

286,701

300,016






















Adjusted EBITDA (2)

\\$ 288,177

\\$    416,280

\\$    374,466

\\$    662,643

\\$    807,448











Adjusted income (loss) derived from operating activities (3)

\\$   69,981

\\$    133,460

\\$      93,447

\\$    163,428

\\$    242,501


(1)

See "Computation of Earnings (Losses) Per Share" included herein as a separate schedule. 



(2)

Adjusted EBITDA is computed by subtracting the sum of direct costs, general and administrative expenses and earnings (losses) from our equity method investment from the sum of Operating revenues and Earnings (losses) from unconsolidated affiliates. These amounts should not be used as a substitute for the amounts reported in accordance with GAAP. However, management evaluates the performance of our business units and the consolidated company based on several criteria, including adjusted EBITDA and adjusted income (loss) derived from operating activities, because we believe that these financial measures accurately reflect our ongoing profitability. There are limitations inherent in using adjusted EBITDA as a measure of overall profitability because it excludes significant expense items. To compensate for the limitations in utilizing adjusted EBITDA as an operating measure, management also uses GAAP measures of performance, including income from continuing operations and net income, to evaluate performance, but only with respect to the Company as a whole and not on a segment basis.  A reconciliation of this non-GAAP measure to income (loss) from continuing operations before income taxes, which is a GAAP measure, is provided in the table set forth immediately following the heading "Reconciliation of Non-GAAP Financial Measures to Income (loss) from Continuing Operations before Income Taxes".


(3)

Adjusted income (loss) derived from operating activities is computed by subtracting the sum of direct costs, general and administrative expenses, depreciation and amortization and earnings (losses) from our equity method investment from the sum of Operating revenues and Earnings (losses) from unconsolidated affiliates. These amounts should not be used as a substitute for those amounts reported in accordance with GAAP. However, management evaluates the performance of our business units and the consolidated company based on several criteria, including adjusted income (loss) derived from operating activities, because it believes that these financial measures accurately reflect our ongoing profitability.  A reconciliation of this non-GAAP measure to income (loss) from continuing operations before income taxes, which is a GAAP measure, is provided in the table set forth immediately following the heading "Reconciliation of Non-GAAP Financial Measures to Income (loss) from Continuing Operations before Income Taxes".

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS



(Unaudited)










June 30,

March 31,

December 31,

(In thousands)

2015

2015

2014







ASSETS





Current assets:





Cash and short-term investments

\\$      469,897

\\$      621,171

\\$       536,169

Accounts receivable, net

908,563

971,601

1,517,503

Assets held for sale

136,677

134,709

146,467

Other current assets

454,018

442,851

541,735

     Total current assets

1,969,155

2,170,332

2,741,874

Long-term investments and other receivables

2,617

2,627

2,806

Property, plant and equipment, net

7,405,441

7,333,808

8,599,125

Goodwill

139,756

80,947

173,928

Investment in unconsolidated affiliates

676,234

730,487

58,251

Other long-term assets

324,080

286,397

303,958

     Total assets

\\$ 10,517,283

\\$ 10,604,598

\\$  11,879,942







LIABILITIES AND EQUITY





Current liabilities:





Current debt

\\$        66,359

\\$           8,739

\\$            6,190

Other current liabilities

1,156,394

1,147,857

1,561,285

     Total current liabilities

1,222,753

1,156,596

1,567,475

Long-term debt

3,691,357

3,816,717

4,348,859

Other long-term liabilities

663,798

663,523

1,044,819

     Total liabilities

5,577,908

5,636,836

6,961,153







Equity:





Shareholders' equity

4,931,960

4,958,813

4,908,619

Noncontrolling interest

7,415

8,949

10,170

     Total equity

4,939,375

4,967,762

4,918,789

     Total liabilities and equity

\\$ 10,517,283

\\$ 10,604,598

\\$  11,879,942

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

SEGMENT REPORTING

(Unaudited)











The following tables set forth certain information with respect to our reportable segments and rig activity:
























Three Months Ended

Six Months Ended


June 30,

March 31,

June 30,











(In thousands, except rig activity)

2015

2014

2015

2015

2014











Reportable segments:









Operating revenues and Earnings (losses) from unconsolidated affiliates:









    Drilling and Rig Services: 









      U.S.

\\$ 321,169

\\$    532,894

\\$    453,821

\\$    774,990

\\$ 1,043,370

      Canada

21,413

54,861

57,840

79,253

166,482

      International

458,229

391,251

445,400

903,629

766,320

      Rig Services (1)

100,599

161,740

144,084

244,683

305,466

       Subtotal Drilling and Rig Services (2)

901,410

1,140,746

1,101,145

2,002,555

2,281,638











    Completion and Production Services:









      Completion Services

-

276,639

208,123

208,123

504,538

      Production Services

-

258,378

158,512

158,512

533,778

       Subtotal Completion and Production Services (3)

-

535,017

366,635

366,635

1,038,316











All Other (4)

(800)

-

-

(800)

-











    Other reconciling items (5)

(38,421)

(59,358)

(46,571)

(84,992)

(116,376)

      Total operating revenues and earnings (losses) from unconsolidated affiliates

\\$ 862,189

\\$ 1,616,405

\\$ 1,421,209

\\$ 2,283,398

\\$ 3,203,578











Adjusted EBITDA: (6)









    Drilling and Rig Services: 









      U.S.

\\$ 136,499

\\$    206,061

\\$    187,745

\\$    324,244

\\$    393,698

      Canada

3,732

14,216

18,468

22,200

54,335

      International

176,994

139,336

201,028

378,022

277,327

      Rig Services (1)

6,341

17,176

21,583

27,924

33,667

       Subtotal Drilling and Rig Services (2)

323,566

376,789

428,824

752,390

759,027











    Completion and Production Services:









      Completion Services

-

27,614

(27,847)

(27,847)

20,960

      Production Services

-

58,267

23,043

23,043

118,323

       Subtotal Completion and Production Services (3)

-

85,881

(4,804)

(4,804)

139,283











    Other reconciling items (7)

(35,389)

(46,390)

(49,554)

(84,943)

(90,862)

      Total adjusted EBITDA

\\$ 288,177

\\$    416,280

\\$    374,466

\\$    662,643

\\$    807,448











Adjusted income (loss) derived from operating activities:  (8)









    Drilling and Rig Services: 









      U.S.

\\$   31,445

\\$      89,977

\\$      77,038

\\$    108,483

\\$    162,471

      Canada

(8,268)

225

6,358

(1,910)

26,385

      International

83,255

50,583

105,041

188,296

98,702

      Rig Services (1)

(1,575)

9,059

12,873

11,298

17,787

       Subtotal Drilling and Rig Services (2)

104,857

149,844

201,310

306,167

305,345











    Completion and Production Services:









      Completion Services

-

(581)

(55,243)

(55,243)

(34,216)

      Production Services

-

29,889

(3,296)

(3,296)

60,480

       Subtotal Completion and Production Services (3)

-

29,308

(58,539)

(58,539)

26,264











    Other reconciling items (7)

(34,876)

(45,692)

(49,324)

(84,200)

(89,108)

   Total adjusted income (loss) derived from operating activities

\\$   69,981

\\$    133,460

\\$      93,447

\\$    163,428

\\$    242,501











Rig activity:









Rig years: (9)









   U.S.

119.5

215.3

167.6

143.4

211.0

   Canada

9.7

21.6

25.6

17.6

32.6

   International (10)

127.1

127.3

130.1

128.6

128.6

      Total rig years 

256.3

364.2

323.3

289.6

372.2

Rig hours: (11)









   U.S. Production Services

-

210,750

129,652

129,652

420,732

   Canada Production Services

-

28,671

23,947

23,947

70,211

      Total rig hours

-

239,421

153,599

153,599

490,943




(1)

Includes our other services comprised of our drilling technology and top drive manufacturing, directional drilling, rig instrumentation and software services.


(2)

Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of \\$(.3) million, \\$(.8) million and \\$6.2 million for the three months ended June 30, 2015 and 2014 and March 31, 2015, respectively and \\$5.9 million and \\$(3.3) million for the six months ended June 30, 2015 and 2014, respectively.


(3)

Includes earnings (losses), net from unconsolidated affiliates, accounted for using the equity method, of \\$.2 million and \\$.3 million for the three months ended June 30, 2014 and March 31, 2015, respectively and \\$.3 million for the six months ended June 30, 2015 and 2014.


(4)

Represents our share of the net income (loss) of C&J Energy Services Ltd. for the eight-day period from the closing of the merger until March 31, 2015.


(5)

Represents the elimination of inter-segment transactions.


(6)

Adjusted EBITDA is computed by subtracting the sum of direct costs, general and administrative expenses and earnings (losses) from our equity method investment from the sum of Operating revenues and Earnings (losses) from unconsolidated affiliates. There are limitations inherent in using adjusted EBITDA as a measure of overall profitability because it excludes significant expense items. However, management evaluates the performance of our business units and the consolidated company based on several criteria, including adjusted EBITDA and adjusted income (loss) derived from operating activities, because we believe that these financial measures accurately reflect our ongoing profitability. These amounts should not be used as a substitute for the amounts reported in accordance with GAAP. To compensate for the limitations in utilizing adjusted EBITDA as an operating measure, management also uses GAAP measures of performance, including income from continuing operations and net income, to evaluate performance, but only with respect to the Company as a whole and not on a segment basis.  A reconciliation of this non-GAAP measure to income (loss) from continuing operations before income taxes, which is a GAAP measure, is provided in the table set forth immediately following the heading "Reconciliation of Non-GAAP Financial Measures to Income (loss) from Continuing Operations before Income Taxes". 



(7)

Represents the elimination of inter-segment transactions and unallocated corporate expenses.


(8)

Adjusted income (loss) derived from operating activities is computed by subtracting the sum of direct costs, general and administrative expenses, depreciation and amortization and earnings (losses) from our equity method investment from the sum of Operating revenues and Earnings (losses) from unconsolidated affiliates. These amounts should not be used as a substitute for the amounts reported in accordance with GAAP. However, management evaluates the performance of our business units and the consolidated company based on several criteria, including adjusted income (loss) derived from operating activities, because it believes that these financial measures accurately reflect our ongoing profitability. A reconciliation of this non-GAAP measure to income (loss) from continuing operations before income taxes, which is a GAAP measure, is provided in the table set forth immediately following the heading "Reconciliation of Non-GAAP Financial Measures to Income (loss) from Continuing Operations before Income Taxes".


(9)

Excludes well-servicing rigs, which are measured in rig hours.  Includes our equivalent percentage ownership of rigs owned by unconsolidated affiliates.  Rig years represent a measure of the number of equivalent rigs operating during a given period.  For example, one rig operating 182.5 days during a 365-day period represents 0.5 rig years.


(10)

International rig years includes our equivalent percentage ownership of rigs owned by unconsolidated affiliates, which totaled 2.5 years during the three months ended June 30, 2014 and March 31, 2015 and 2.5 years for the six months ended June 30, 2014.  As of May 24, 2015, this was no longer an unconsolidated affiliate.


(11)

Rig hours represents the number of hours that our well-servicing rig fleet operated during the period. This fleet was included in the Completion and Production Services business line that was merged with C&J Energy Services, Inc. in March 2015, therefore we will no longer report this performance metric.

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO 

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

(Unaudited)
























Three Months Ended

Six Months Ended


June 30,

March 31,

June 30,











(In thousands)

2015

2014

2015

2015

2014











Adjusted EBITDA

\\$ 288,177

\\$ 416,280

\\$ 374,466

\\$ 662,643

\\$ 807,448

Less: Depreciation and amortization 

218,196

282,820

281,019

499,215

564,947

Adjusted income (loss) derived from operating activities

69,981

133,460

93,447

163,428

242,501











Earnings (losses) from equity method investment

(800)

-

-

(800)

-

Interest expense

(44,469)

(46,303)

(46,601)

(91,070)

(91,113)

Investment income (loss)

1,181

7,066

969

2,150

8,046

Gains (losses) on sales and disposals of long-lived assets and other income (expense), net

(1,338)

(16,504)

55,842

54,504

(17,980)

Income (loss) from continuing operations before income taxes

\\$   24,555

\\$   77,719

\\$ 103,657

\\$ 128,212

\\$ 141,454

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

COMPUTATION OF EARNINGS (LOSSES) PER SHARE

(Unaudited)






















A reconciliation of the numerators and denominators of the basic and diluted earnings (losses) per share computations is as follows:

























Three Months Ended

Six Months Ended


June 30,

March 31,

June 30,











(In thousands, except per share amounts)

2015

2014

2015

2015

2014











BASIC EPS:









Income (loss) from continuing operations, net of tax

\\$(41,890)

\\$65,729

\\$ 124,362

\\$82,472

\\$ 114,706

   Less: Net (income) loss attributable to noncontrolling interest

44

(253)

89

133

(826)

   Less: Redemption of preferred shares

-

(1,688)

-

-

(1,688)

   Less: Earnings allocated to unvested shareholders

720

(974)

(2,031)

(1,311)

(1,707)

Adjusted income (loss) from continuing operations - basic and diluted

\\$(41,126)

\\$62,814

\\$ 122,420

\\$81,294

\\$ 110,485

Income (loss) from discontinued operations, net of tax

\\$    5,025

\\$ (1,032)

\\$       (817)

\\$   4,208

\\$        483











Weighted-average number of shares outstanding-basic

286,085

297,984

285,361

285,723

297,097











Earnings (losses) per share:









     Basic from continuing operations

\\$       (.14)

\\$       .21

\\$         .43

\\$       .28

\\$         .37

     Basic from discontinued operations

.01

-

-

.02

-

Total Basic

\\$       (.13)

\\$       .21

\\$         .43

\\$       .30

\\$         .37











DILUTED EPS:









Income (loss) from continuing operations attributed to common shareholders

\\$(41,126)

\\$62,814

\\$ 122,420

\\$81,294

\\$ 110,485

Add: Effect of reallocating undistributed earnings of unvested shareholders

-

-

5

5

-

Adjusted income (loss) from continuing operations attributed to common shareholders

\\$(41,126)

\\$62,814

\\$ 122,425

\\$81,299

\\$ 110,485

Income (loss) from discontinued operations

\\$    5,025

\\$ (1,032)

\\$       (817)

\\$   4,208

\\$        483






















   Weighted-average number of shares outstanding-basic

286,085

297,984

285,361

285,723

297,097

Add: dilutive effect of potential common shares

-

2,997

812

978

2,919

   Weighted-average number of diluted shares outstanding

286,085

300,981

286,173

286,701

300,016











     Diluted from continuing operations

\\$       (.14)

\\$       .21

\\$         .43

\\$       .28

\\$         .37

     Diluted from discontinued operations

.01

-

(.01)

.02

-

Total Diluted

\\$       (.13)

\\$       .21

\\$         .42

\\$       .30

\\$         .37

































Restricted stock grants that contain non-forfeitable rights to dividends are considered participating securities.  As such, these grants are included in our basic and diluted earnings (losses) per share computation using the two-class method of accounting.  For all periods presented, the computation of diluted earnings (losses) per share excluded outstanding stock options with exercise prices greater than the average market price of Nabors' common shares because their inclusion would have been anti-dilutive and because they were not considered participating securities. The average number of options that were excluded from diluted earnings (losses) per share that would have potentially diluted earnings (losses) per share were 9,860,422, 5,782,273 and 6,621,688 shares during the three months ended June 30, 2015 and 2014 and March 31, 2015, respectively and 6,325,598 and 6,817,891 shares during the six months ended June 30, 2015 and 2014, respectively. In any period during which the average market price of Nabors' common shares exceeds the exercise prices of these stock options, such stock options are included in our diluted earnings (losses) per share computation using the if-converted method of accounting.  

NABORS INDUSTRIES LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (LOSS) ITEMS EXCLUDING CERTAIN NON-CASH CHARGES
AND OTHER NON-OPERATIONAL ITEMS (NON-GAAP)

(Unaudited)











Charges and Non-
Operational

As adjusted

(In thousands, except per share amounts)

Actuals

Items

(Non-GAAP)









Three Months Ended March 31, 2015







Income (loss) from continuing operations, net of tax

\\$ 124,362

\\$                66,115

\\$             58,247

Diluted earnings (losses) per share from continuing operations

\\$       0.43

\\$                    0.23

\\$                 0.20

NABORS INDUSTRIES LTD. AND SUBSIDIARIES






SCHEDULE OF NON-CASH CHARGES AND OTHER NON-OPERATIONAL ITEMS (NON-GAAP)

(Unaudited)








Three Months Ended


March 31,




Per Diluted

(In thousands, except per share amounts)

2015

Share






           Net gain from the C&J Energy Services transaction (1)

\\$(61,885)

\\$          (.22)

           Prior year tax benefits (2)

(10,499)

(.03)

           Severance charges (3)

6,269

.02






Total Adjustments, net of tax

\\$(66,115)

(.23)

(1) Represents the net gain from the C&J Energy Services transaction, net of tax of (\\$9.3) million.

(2) Represents tax benefits related to releases of tax provisions and reserves in various jurisdictions.

(3) Represents severance charges from workforce reductions, net of tax of \\$1.6 million.