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What changed in Helmerich & Payne, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Helmerich & Payne, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+423 added−466 removedSource: 10-K (2025-11-21) vs 10-K (2024-11-13)

Top changes in Helmerich & Payne, Inc.'s 2025 10-K

423 paragraphs added · 466 removed · 280 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

69 edited+42 added−54 removed40 unchanged
Biggest changeThe following table sets forth certain information concerning our International Solutions drilling rigs as of September 30, 2024: INTERNATIONAL SOLUTIONS FLEET Location AC (FlexRig ® 3) 1 AC (FlexRig ® 3WA) 2 AC (FlexRig ® 4) 3 Other AC SCR 4 Total Fleet Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Argentina 12 7 — — — — — — — — 12 7 Saudi Arabia — — 5 5 — — — — — — 5 5 Colombia 2 — — — — — 1 — 2 — 5 — Bahrain 1 1 — — 3 2 — — — — 4 3 Australia 1 1 — — — — — — — — 1 1 Totals 16 9 5 5 3 2 1 — 2 — 27 16 (1) The FlexRig ® 3 is equipped with an AC drive, 1,500 horsepower drawworks, and a 750,000 lb. hookload rating.
Biggest change(2) AC drive, 1,500 horsepower drawworks, 500,000 or 750,000 lbs. hookload rating, 5,000 or 7,500 psi mud circulating system, may or may not have multiple-well pad capability. 2025 FORM 10-K | 7 Table of Contents The following table sets forth certain information concerning our International Solutions drilling rigs as of September 30, 2025: INTERNATIONAL SOLUTIONS FLEET Location AC (FlexRig ® 3) 2 AC (FlexRig ® 4) 3 AC SCR Mechanical AC SCR Desert 1 SCR 4 Other AC Total Available Fleet Total Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Saudi Arabia 5 — — — — — — 44 44 — — — — 44 44 Oman — — — — — — 25 16 — — — — 25 16 Argentina 12 7 — — — — — — 1 — 3 1 16 8 Colombia 2 — — — — — — — 5 3 2 — 9 3 Germany — — — — — — — — 1 1 3 3 4 4 Bahrain 1 1 3 2 — — — — — — — — 4 3 Pakistan — — — — — — — — 3 3 — — 3 3 Kuwait 6 — — — — — — 4 2 — — — — 4 2 Australia 2 2 — — — — — — — — — — 2 2 Rest of World — — — — 2 — 7 — 13 1 4 2 26 3 Totals 17 10 3 2 2 — 80 62 23 8 12 6 137 88 (1) `Desert rigs are designed for reliable drilling in extreme weather conditions, specifically in harsh and remote desert environments.
Each drilling rig operates under a separate drilling contract and, in some instances, these contracts are part of an over-arching term agreement known as a FlexPool. These agreements are with a limited number of customers that operate multiple rigs, oftentimes across multiple basins in the U.S.
Each drilling rig operates under a separate drilling contract and, in some instances, these contracts are part of an over-arching term agreement known as a FlexPool. These agreements are with a limited number of domestic customers that operate multiple rigs, oftentimes across multiple basins in the U.S.
See Note 3—Property, Plant and Equipment to our Consolidated Financial Statements. (3) Defined as the number of rigs generating revenue at the applicable end date of the time period.
See Note 4—Property, Plant and Equipment to our Consolidated Financial Statements. (3) Defined as the number of rigs generating revenue at the applicable end date of the time period.
In the Gulf of Mexico platform rig market, we primarily compete with Nabors Industries Ltd. and Blake International Rigs, LLC. For further information concerning risks associated with competition in our industry, see Item 1A—Risk Factors—Business and Operating Risks. Drilling Contracts Our drilling contracts are obtained through competitive bidding or as a result of direct negotiations with customers.
In the Gulf of America platform rig market, we primarily compete with Nabors Industries Ltd. and Blake International Rigs, LLC. For further information concerning risks associated with competition in our industry, see Item 1A—Risk Factors—Business and Operating Risks. Drilling Contracts Our drilling contracts are obtained through competitive bidding or as a result of direct negotiations with customers.
(2) Active rigs generate revenue for the Company; accordingly 'average active rigs' represents the average number of rigs generating revenue during the applicable period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e. 366 days). This includes the impact of downsizing our fleet and/or rigs that have been reclassified to assets held-for-sale.
(2) Active rigs generate revenue for the Company; accordingly 'average active rigs' represents the average number of rigs generating revenue during the applicable period. This metric is calculated by dividing revenue days by total days in the applicable period (i.e. 365 days). This includes the impact of downsizing our fleet and/or rigs that have been reclassified to assets held-for-sale.
Environmental laws and regulations that apply to our operations include the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), the Resource Conservation and Recovery Act (each, as amended) and similar laws that provide for responses to, and liability for, air emissions, water discharges or releases of oil or hazardous substances into the environment, including damages to natural resources.
Environmental laws and regulations that apply to our operations include the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), the Resource Conservation and Recovery Act (each, as amended) and similar laws that provide for responses to, and liability for, air emissions, water discharges or releases of oil or hazardous substances into the environment, including damages to natural resources, species, or habitats.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us. 2024 FORM 10-K | 16 Table of Contents Government Regulations Our operations are affected from time to time and in varying degrees by foreign and domestic political developments and a variety of federal, state, foreign, regional and local laws, rules and regulations, including those relating to: • drilling of oil and natural gas wells; • directional drilling services; • protection of the environment; • workplace health and safety; • labor and employment; • data privacy; • taxation; • exportation or importation of equipment, technology and software; • currency conversion and repatriation; • global anti-corruption laws; and • government sanctions and embargo listing.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us. 2025 FORM 10-K | 15 Table of Contents Government Regulations Our operations are affected from time to time and in varying degrees by foreign and domestic political developments and a variety of federal, state, foreign, regional and local laws, rules and regulations, including those relating to: • drilling of oil and natural gas wells; • directional drilling services; • protection of the environment; • workplace health and safety; • labor and employment; • data privacy; • taxation; • exportation or importation of equipment, technology and software; • currency conversion and repatriation; • global anti-corruption laws; and • government sanctions and embargo listing.
We have made and will continue to make the required expenditures to comply with current and future regulatory requirements. We do not anticipate that compliance with currently applicable rules and regulations and required controls will significantly change our competitive position, capital spending or earnings during fiscal year 2025.
We have made and will continue to make the required expenditures to comply with current and future regulatory requirements. We do not anticipate that compliance with currently applicable rules and regulations and required controls will significantly change our competitive position, capital spending or earnings during fiscal year 2026.
Insurance is purchased over deductibles to reduce our exposure to catastrophic events. We retain a significant portion of our expected losses under our workers’ compensation, general liability and automobile liability programs. We self-insure a number of other risks including loss of earnings and business interruption.
Insurance is purchased over SIRs or deductibles to reduce our exposure to catastrophic events. We retain a significant portion of our expected losses under our workers’ compensation, general liability and automobile liability programs. We self-insure a number of other risks including loss of earnings and business interruption.
Foreign Corrupt Practices Act or foreign anti‑bribery legislation could adversely affect our business and Our business is subject to complex and evolving laws and regulations regarding privacy, data security and consumer protection. ” 2024 FORM 10-K | 17 Table of Contents We are also subject to the jurisdiction of the U.S. Treasury Department’s Office of Foreign Assets Control, the U.S.
Foreign Corrupt Practices Act or foreign anti‑bribery legislation could adversely affect our business and Our business is subject to complex and evolving laws and regulations regarding privacy, data security and consumer protection. ” 2025 FORM 10-K | 16 Table of Contents We are also subject to the jurisdiction of the U.S. Treasury Department’s Office of Foreign Assets Control, the U.S.
As such, significant declines in the prices of oil and natural gas may have a material adverse effect on our business, financial condition and results of operations. As of September 30, 2024, we had 170 active rigs under contract, compared to 164 and 192 rigs under contract as of September 30, 2023 and 2022, respectively.
As such, significant declines in the prices of oil and natural gas may have a material adverse effect on our business, financial condition and results of operations. As of September 30, 2025, we had 208 active rigs under contract, compared to 170 and 164 rigs under contract as of September 30, 2024 and 2023, respectively.
It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the social media channels listed on our investor relations website. 2024 FORM 10-K | 18 Table of Contents
It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on the social media channels listed on our investor relations website. 2025 FORM 10-K | 17 Table of Contents
However, we self-insure large deductibles under these policies. We also carry insurance with varying deductibles and coverage limits with respect to stacked rigs, offshore platform rigs, and “named wind storm” risk in the Gulf of Mexico. We have insurance coverage for comprehensive general liability, automobile liability, workers’ compensation and employer’s liability, and certain other specific risks.
However, we self-insure large SIRs and deductibles under these policies. We also carry insurance with varying SIRs, deductibles, and coverage limits with respect to stacked rigs, offshore platform rigs, and “named windstorm” risk in the Gulf of America. We have insurance coverage for comprehensive general liability, automobile liability, workers’ compensation and employer’s liability, and certain other specific risks.
Investors and others should note that we announce material financial information to our investors using our investor relations website (https://ir.helmerichpayne.com/websites/helmerichandpayne/English/0/investor-relations.html), SEC filings, press releases, public conference calls and webcasts. We use these channels as well as social media to communicate with our stockholders and the public about our company, our services and other issues.
Investors and others should note that we announce material financial information to our investors using our investor relations website (https://ir.hpinc.com/investors), SEC filings, press releases, public conference calls and webcasts. We use these channels as well as social media to communicate with our stockholders and the public about our company, our services and other issues.
Revenue from drilling services performed for our largest drilling customer totaled approximately 11.0 percent ($302.6 million) of our total consolidated revenues during fiscal year 2024. We did not have any individual customers that represented 10% or more of our total consolidated revenues in fiscal years 2023, or 2022.
Revenue from drilling services performed for our largest drilling customer totaled approximately 12.0 percent ($451.3 million) and 11.0 percent ($302.6 million) of our total consolidated revenues during fiscal years 2025 and 2024, respectively. We did not have any individual customers that represented 10% or more of our total consolidated revenues in fiscal year 2023.
In North America, our customers are primarily from the major integrated oil companies, large independent oil companies, small cap oil companies and private independent companies (including private equity-backed companies). Revenue from drilling services performed for our largest North America Solutions drilling customer totaled approximately 12.2 percent ($299.3 million) of the North America Solutions segment revenues during fiscal year 2024.
In North America, our customers are primarily from the major integrated oil companies, large independent oil companies, small cap oil companies and private independent companies (including private equity-backed companies). Revenue from drilling services performed for our largest North America Solutions drilling customer totaled approximately 18.2 percent ($429.4 million) of the North America Solutions segment revenues during fiscal year 2025.
We continue to use our captive insurance subsidiaries to insure the deductibles for our domestic workers’ compensation, general liability, automobile liability claims programs, and medical stop-loss program and to insure the deductibles from the Company's international casualty and rig property programs. Our real estate operations and our wholly-owned captive insurance companies are included in "Other" within our segment disclosures.
We also continue to use our Captive insurance subsidiaries to fund SIRs and deductibles for our domestic workers’ compensation, general liability, automobile liability claims programs, medical stop-loss program, and certain international casualty and rig property programs. Our manufacturing and engineering operations, real estate operations and our wholly-owned captive insurance companies are included in "Other" within our segment disclosures.
If we do not meet these targets, we will not receive additional compensation above the base dayrate. The variable consideration that we expect to receive is estimated at the most likely amount, and constrained to an amount such that it is probable a significant reversal of revenue previously recognized will not occur based on the performance targets.
The variable consideration that we expect to receive is estimated at the most likely amount, and constrained to an amount such that it is probable a significant reversal of revenue previously recognized will not occur based on the performance targets.
(2) Rigs are idle, stacked on land and not in state waters. Drilling Services and Solutions General We are the largest provider of super-spec AC drive land rigs in the Western Hemisphere.
(2) Rigs are idle, stacked on land and not in state waters. 2025 FORM 10-K | 8 Table of Contents Drilling Services and Solutions We are the largest provider of super-spec AC drive land rigs in the Western Hemisphere.
Revenues generated by Argentine drilling operations contributed approximately 5.2 percent ($142.5 million) of our consolidated operating revenues during fiscal year 2024 compared to approximately 4.8 percent ($137.4 million) and 4.4 percent ($91.4 million) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively.
Revenues generated by Argentine drilling operations within the International Solutions operating segment contributed approximately 4.2 percent ($155.7 million) of our consolidated operating revenues during fiscal year 2025 compared to approximately 5.2 percent ($142.5 million) and 4.8 percent ($137.4 million) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
(3) The FlexRig ® 4 model has a small footprint and is designed to be highly mobile. The rig is equipped with a 300,000 lb. mast, 400HP top drive and two mud pumps. Range 3 drill pipe is used without setback. The rig is capable of horizontal and vertical drilling, but is primarily used for vertical drilling.
The rig is equipped with a 300,000 lb. mast, 400HP top drive and two mud pumps. Range 3 drill pipe is used without setback. The rig is capable of horizontal and vertical drilling, but is primarily used for vertical drilling.
Fixed-term contracts generally have a minimum term of at least six months up to multiple years. These contracts customarily provide for termination at the election of the customer, but may include an “early termination payment” to be paid to us if the contract is terminated prior to the expiration of the fixed term.
These contracts customarily provide for termination at the election of the customer, but may include an “early termination payment” to be paid to us if the contract is terminated prior to the expiration of the fixed term.
Our Offshore Gulf of Mexico operations contributed approximately 3.9 percent ($106.2 million) of our consolidated operating revenues during fiscal year 2024, compared to approximately 4.5 percent ($130.2 million) and 6.1 percent ($125.5 million) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively.
Our Offshore Solutions operations contributed approximately 13.9 percent ($520.4 million) of our consolidated operating revenues during fiscal year 2025, compared to approximately 3.9 percent ($106.2 million) and 4.5 percent ($130.2 million) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
Revenues generated by Bahrain drilling operations contributed approximately 0.7 percent ($18.0 million) of our consolidated operating revenues in fiscal year 2024, compared to approximately 0.5 percent ($15.4 million) and 0.8 percent ($17.0 million) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively.
Within the International Solutions operating segment, drilling revenues generated in Bahrain contributed approximately 0.8 percent ($30.8 million) of our consolidated operating revenues in fiscal year 2025, compared to approximately 0.7 percent ($18.0 million) and 0.5 percent ($15.4 million) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
Contracts generally contain renewal or extension provisions exercisable at the option of the customer. The option to extend and the pricing are mutually agreed upon by both the customer and H&P.
Contracts generally contain renewal or extension provisions exercisable at the option of the customer. The option to extend and the pricing are mutually agreed upon by both the customer and H&P. In most instances, contracts provide for additional payments for mobilization and demobilization of the rig.
Operating principally in North and South America, we specialize in shale and unconventional resource plays, drilling challenging and complex wells in oil and gas producing basins in the United States and in international locations.
We operate principally in North America and specialize in shale and unconventional resource plays, drilling challenging and complex wells in oil and gas producing basins.
The following table presents operating statistics for the fiscal years 2024, 2023, and 2022: Year Ended September 30, North America Solutions International Solutions Offshore Gulf of Mexico 2024 2023 2022 2024 2023 2022 2024 2023 2022 Revenue days 1 55,387 61,814 59,672 4,614 4,788 3,036 1,111 1,460 1,460 Average active rigs 2 151 169 163 13 13 8 3 4 4 Number of active rigs at the end of period 3 151 147 176 16 13 12 3 4 4 Number of available rigs at the end of period 228 233 236 27 22 28 7 7 7 (1) Defined as the number of contractual days we recognized revenue during the period.
The following table presents operating statistics for the fiscal years 2025, 2024, and 2023: Year Ended September 30, North America Solutions International Solutions Offshore Solutions 2025 2024 2023 2025 2024 2023 2025 2024 2023 Revenue days 1 53,523 55,387 61,814 19,985 4,614 4,788 1,095 1,111 1,460 Average active rigs 2 147 151 169 55 13 13 3 3 4 Number of active rigs at the end of period 3 144 151 147 61 16 13 3 3 4 Number of available rigs at the end of period 223 228 233 137 27 22 7 7 7 (1) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period.
It can be equipped with an optional skid or walking system, third mud pump, and 7,500 psi high pressure mud system. Nine rigs in Argentina are equipped with skid systems, a third mud pump and 7,500 psi high pressure mud systems.
It can be equipped with an optional skid or walking system, third mud pump, and 7,500 psi high pressure mud system. Nine rigs in Argentina are equipped with skid systems, a third mud pump and 7,500 psi high pressure mud systems. (3) The FlexRig ® 4 model has a small footprint and is designed to be highly mobile.
In the United States, we have a diverse mix of customers consisting of large independent, major, mid-sized and small cap oil companies and private independent companies (including private equity-backed companies) that are primarily focused on unconventional shale basins. In South America and the Middle East, our customers primarily include major international and national oil companies.
In the United States, our customers include a diverse mix of large independent, major, mid-sized and small cap oil companies as well as private independent companies (including those backed by private equity), primarily focused on unconventional shale basins.
International Solutions Segment Our International Solutions segment conducts operations primarily in Argentina, Bahrain, Australia, U.A.E. and Colombia. Additionally, we commenced operations in Saudi Arabia in the first quarter of fiscal 2025. As of September 30, 2024, we had 16 land rigs contracted for work in locations outside of the United States.
International Solutions Segment Our International Solutions segment conducts operations primarily in Saudi Arabia, Argentina, Oman, Bahrain, Germany, Colombia, and Kuwait. As of September 30, 2025, we had 88 land rigs contracted for work in locations outside of the United States.
Diversity, Equity & Inclusion We believe that creating an environment where our employees feel valued and respected drives engagement, better leverages the unique talents and perspectives of our people to innovate and enhances our ability to attract and retain a diverse workforce.
Culture and Belonging We believe that creating an environment where our employees feel valued and respected drives engagement, better leverages the unique talents and perspectives of our people to innovate and enhances our ability to attract and retain a diversified workforce. H&P is an equal opportunity employer and is committed to equal opportunity employment.
Drilling Fleet The following map shows the number of available rigs by basin in our North America Solutions reportable segment as of September 30, 2024: 2024 FORM 10-K | 7 Table of Contents The following table sets forth certain information concerning our North America Solutions drilling rigs as of September 30, 2024: NORTH AMERICA SOLUTIONS FLEET Location Super-Spec FlexRig ® 1 Non Super-Spec FlexRig ® 2 Total Fleet Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted TX 124 84 — — 124 84 NM 45 36 — — 45 36 OK 17 5 — — 17 5 ND 11 8 — — 11 8 LA 11 3 — — 11 3 WV 5 4 — — 5 4 CO 3 3 2 1 5 4 UT 4 3 — — 4 3 PA 4 2 — — 4 2 OH 2 2 — — 2 2 Totals 226 150 2 1 228 151 (1) AC drive, minimum of 1,500 horsepower drawworks, minimum of 750,000 lbs. hookload rating, 7,500 psi mud circulating system, and multiple-well pad capability.
To mitigate the financial impact of significant events, the Company and the Captives maintain excess property and casualty reinsurance programs with third-party insurers. 2025 FORM 10-K | 6 Table of Contents Drilling Fleet The following map shows the number of available rigs by basin in our North America Solutions reportable segment as of September 30, 2025: The following table sets forth certain information concerning our North America Solutions drilling rigs as of September 30, 2025: NORTH AMERICA SOLUTIONS FLEET Location Super-Spec FlexRig ® 1 Non Super-Spec FlexRig ® 2 Total Fleet Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted TX 129 71 — — 129 71 NM 44 40 — — 44 40 OK 17 7 — — 17 7 ND 8 6 — — 8 6 CO 5 3 2 1 7 4 LA 5 5 — — 5 5 UT 4 3 — — 4 3 OH 4 3 — — 4 3 PA 2 2 — — 2 2 WV 2 2 — — 2 2 AR 1 1 — — 1 1 Totals 221 143 2 1 223 144 (1) AC drive, minimum of 1,500 horsepower drawworks, minimum of 750,000 lbs. hookload rating, 7,500 psi mud circulating system, and multiple-well pad capability.
As of September 30, 2024, we had approximately 26.1 percent of the total market share in U.S. land drilling and approximately 34.6 percent of the super-spec market share in U.S. land drilling.
As of September 30, 2025, we had approximately 24.0 percent of the total market share in U.S. land drilling and approximately 33.7 percent of the super-spec market share in U.S. land drilling.
Applicable environmental laws and regulations also include similar foreign, state or local counterparts to the above-mentioned federal laws, which regulate air emissions, water discharges, and management of hazardous substances and waste.
Applicable environmental laws and regulations also include similar foreign, state or local counterparts to the above-mentioned federal laws, which regulate air emissions, water discharges, and management of hazardous substances and waste. Additionally, regulations relating to the protection of threatened or endangered species or critical habitats may result in limitations on exploration and production activities.
The SCR rigs are equipped with 3,000 horsepower drawworks to drill deep conventional wells. 2024 FORM 10-K | 8 Table of Contents The following table sets forth certain information concerning our Offshore Gulf of Mexico drilling rigs as of September 30, 2024: OFFSHORE GULF OF MEXICO FLEET Location Shallow Water 1 Deep Water 1 Total Fleet Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Louisiana 2 3 — — — 3 — Gulf of Mexico 1 — 3 3 4 3 Totals 4 — 3 3 7 3 (1) Shallow water rigs operate on fixed facilities and deep water rigs operate on floating facilities.
The following table sets forth certain information concerning our Offshore Solutions drilling rigs as of September 30, 2025: OFFSHORE SOLUTIONS FLEET Location Shallow Water 1 Deep Water 1 Total Fleet Total Available Rigs Contracted Total Available Rigs Contracted Total Available Rigs Contracted Louisiana 2 4 — — — 4 — Gulf of America — — 3 3 3 3 Totals 4 — 3 3 7 3 (1) Shallow water rigs operate on fixed facilities and deep water rigs operate on floating facilities.
Our International Solutions operations contributed approximately 7.0 percent ($194.0 million) of our consolidated operating revenues during fiscal year 2024, compared to approximately 7.4 percent ($212.6 million) and 6.6 percent ($136.1 million) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively. Argentina As of September 30, 2024, we had 12 available rigs in Argentina.
Our International Solutions operations contributed approximately 21.4 percent ($802.4 million) of our consolidated operating revenues during fiscal year 2025, compared to approximately 7.0 percent ($194.0 million) and 7.4 percent ($212.6 million) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
The number of employees fluctuates depending on the current and expected demand for our services. We consider our employee relations to be robust. None of our U.S. employees are represented by a union. However, some of our international employees are unionized.
Employees As of September 30, 2025, we had approximately 6,200 employees within the United States and approximately 9,500 employees in our international operations. The number of employees fluctuates depending on the current and expected demand for our services. We consider our employee relations to be robust. None of our U.S. employees are represented by a union.
Our technology services focus on developing, promoting and commercializing technologies designed to improve the efficiency and accuracy of drilling operations, as well as wellbore quality and placement. Our drilling services operations are organized into the following reportable operating business segments: North America Solutions, International Solutions and Offshore Gulf of Mexico.
Our technology services focus on developing, promoting and commercializing technologies designed to improve the efficiency and accuracy of drilling operations, as well as wellbore quality and placement.
Performance-based Contracts Performance-based contracts are contracts pursuant to which we are compensated partly based upon our performance against a mutually agreed upon set of predetermined targets. These types of contracts typically have a lower base dayrate, but give us the opportunity to receive additional compensation by meeting or exceeding certain performance targets agreed to by our customers.
These types of contracts typically have a lower base dayrate, but give us the opportunity to receive additional compensation by meeting or exceeding certain performance targets agreed to by our customers. For example, some performance targets are set based upon days to drill a well or the number of lateral feet drilled in zone per day.
Colombia As of September 30, 2024, we had five available rigs in Colombia. Revenues generated by Colombian drilling operations contributed approximately 0.3 percent ($9.3 million) of our consolidated operating revenues in fiscal year 2024, compared to approximately 1.6 percent ($46.7 million) and 1.1 percent ($22.0 million) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively.
Within the International Solutions operating segment, drilling services revenues generated in Colombia contributed approximately 1.0 percent ($36.1 million) of our consolidated operating revenues in fiscal year 2025, compared to approximately 0.3 percent ($9.3 million) and 1.6 percent ($46.7 million) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
Daywork Contracts Daywork contracts are contracts under which we charge a rate per day, with the price determined by the location, depth and complexity of the well to be drilled, operating conditions, the duration of the contract, and the competitive forces of the market.
Daywork Contracts Daywork contracts are contracts under which we charge a rate per day, with the price determined by the location, depth and complexity of the well to be drilled, specification of the rig provided, operating conditions, the duration of the contract, and the competitive forces of the market. 2025 FORM 10-K | 12 Table of Contents Performance-based Contracts Performance-based contracts are contracts pursuant to which we are compensated partly based upon our performance against a mutually agreed upon set of predetermined targets.
All of our technologies play an important role in developing our strategy as we head towards autonomous drilling. Markets and Competition Our business largely depends on the level of capital spending by oil and gas companies for exploration and production activities. The level of capital spending has traditionally been correlated to oil and gas prices.
Our path to autonomous drilling continues to evolve with several solutions in various stages of commercial testing. Markets and Competition Our business largely depends on the level of capital spending by oil and gas companies for exploration and production activities. The level of capital spending has traditionally been correlated to oil and gas prices.
Based on our operational track record throughout fiscal year 2024 and drilling expertise, our performance-based contracts have produced a positive risk-reward outcome. We are seeing a growing adoption of performance contracts by our customers and we expect this trend to continue. Refer to Note 9—Revenue from Contracts with Customers for additional information related to performance-based contracts.
Based on our operational track record throughout fiscal year 2025 and drilling expertise, our performance-based contracts have produced a positive risk-reward outcome. Refer to Note 10—Revenue from Contracts with Customers for additional information related to performance-based contracts. Contract Backlog Our contract drilling backlog was $7.0 billion and $1.5 billion as of September 30, 2025 and 2024, respectively.
Our offshore rig fleet operates on conventional fixed leg platforms and floating platforms attached to the sea floor with mooring lines, such as Spars and Tension Leg Platforms.
Offshore Solutions Segment Our Offshore Solutions segment has been in operation since 1968 and currently consists of seven platform rigs located in U.S. federal waters. Our offshore rig fleet operates on conventional fixed leg platforms and floating platforms attached to the sea floor with mooring lines, such as Spars and Tension Leg Platforms.
The Colombian drilling contracts that generated revenue during the fiscal year were primarily with large international or national oil companies. Saudi Arabia During the year ended September 30, 2024, we began mobilizing five super-spec rigs to the Kingdom of Saudi Arabia. We commenced operations in the first quarter of fiscal 2025.
The Colombian drilling contracts that generated revenue during the fiscal year were primarily with large international or national oil companies. Kuwait As of September 30, 2025, we had four available rigs in Kuwait, in addition to two leased rigs.
In most instances, contracts provide for additional payments for mobilization and demobilization of the rig. 2024 FORM 10-K | 12 Table of Contents The duration of our drilling contracts are generally either “well‑to‑well/pad-to-pad” or for a fixed term. “Well‑to‑well” contracts can be terminated at the option of either party upon the completion of drilling of any one well.
The duration of our drilling contracts are generally either “well‑to‑well/pad-to-pad” or for a fixed term. “Well‑to‑well” contracts can be terminated at the option of either party upon the completion of drilling of any one well. Fixed-term contracts generally have a minimum term of at least six months up to multiple years.
We also provide supplemental non-statutory benefits to our international employees that are customary and competitive to each specific region. Insurance and Risk Management Our operations are subject to a number of operational risks, including personal injury and death, environmental, cyber, and weather risks, which could expose us to significant losses and damage claims.
Insurance and Risk Management Our operations are subject to a number of operational risks, including personal injury and death, environmental, cyber, and weather risks, which could expose us to significant losses and damage claims. We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us.
Our facility located in Galena Park, Texas is primarily utilized for overall rig assembly, overhaul, recommissioning and recertification while our facility near Tulsa, Oklahoma is primarily utilized for modular rig component overhauls and repairs. We continue to see adoption and growth with our technologically enabled automation solutions.
We operate legacy H&P vertically integrated facilities for manufacturing, upgrades, retrofits, modifications, overhauls, recertification, and repairs of our rigs and equipment. Our facility located in Galena Park, Texas is primarily utilized for overall rig assembly, overhaul, recommissioning and recertification while our facility near Tulsa, Oklahoma is primarily utilized for modular rig component overhauls and repairs.
The Company continues to evolve and refine its comprehensive sustainability strategy rooted in our core value to "do the right thing," as discussed above. Our sustainability strategy uses data to better understand our impacts in areas like emissions, diversity, and safety.
The Company continues to evolve and refine its sustainability strategy rooted in our core value to "do the right thing," as discussed above. Available Information Our website is located at www.helmerichpayne.com.
Management's Discussion and Analysis of Financial Condition and Results of Operations—"Contract Backlog" included in this Form 10-K for additional information pertaining to backlog. Employees As of September 30, 2024, we had approximately 6,200 employees within the United States and approximately 800 employees in our international operations.
Approximately 22.6 percent of the September 30, 2025 backlog is reasonably expected to be fulfilled in fiscal year 2026. See Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—"Contract Backlog" included in this Form 10-K for additional information pertaining to backlog.
In the United States, we have the industry's largest super-spec fleet and had 151 of our 228 marketed rigs active under contract as of September 30, 2024 of which 88 were under fixed‑term contracts, and 63 were working well-to-well. 2024 FORM 10-K | 9 Table of Contents Our drilling technology within this segment enables a solutions-based approach that provides performance-driven drilling services designed to help deliver greater levels of drilling efficiency, accuracy, consistency, optimization and a reduction of human error to create higher quality wellbores with lower overall risk.
Our drilling technology within this segment enables a solutions-based approach that provides performance-driven drilling services designed to help deliver greater levels of drilling efficiency, accuracy, consistency, optimization and a reduction of human error to create higher quality wellbores with lower overall risk.
Revenues from drilling services performed for our two largest customers in Argentina totaled approximately 3.4 percent of our consolidated operating revenues and approximately 48.6 percent of our international operating revenues during fiscal year 2024. The Argentine drilling contracts are primarily with large international or national oil companies. Bahrain As of September 30, 2024, we had four available rigs in Bahrain.
The Argentine drilling contracts are primarily with large international or national oil companies. Oman As of September 30, 2025, we had 25 available rigs in Oman. Revenues generated by Oman drilling operations within the International Solutions operating segment contributed approximately 4.7 percent ($177.9 million) of our consolidated operating revenues in fiscal year 2025.
Revenues from drilling services performed for our largest offshore drilling customer totaled approximately 97.3 percent ($103.3 million) of offshore revenues during fiscal year 2024. Other Operations We own and operate a limited number of commercial real estate properties located in Tulsa, Oklahoma. Our real estate investments include a shopping center and undeveloped real estate.
We also own and operate a limited number of commercial real estate properties located in Tulsa, Oklahoma. Our real estate investments include a shopping center and undeveloped real estate.
Our core value of Teamwork means that we listen to one another and work across teams toward a common goal. We collaborate to achieve results and focus on success for our customers and shareholders. Finally, we strive to Do The Right Thing. That means we are honest and transparent. We tackle tough situations, make decisions, and speak up when needed.
We seek to make decisions with a long-term view in mind. • Teamwork – We should listen to one another and collaborate across teams to achieve shared goals and deliver value. • Do The Right Thing – Means being honest and transparent. We aim to tackle tough situations, make decisions and speak up when needed.
Our wholly-owned captive insurance companies (the “Captives”) are primarily used to insure the deductibles for our workers’ compensation, general liability, automobile liability, rig property and a medical stop-loss program. The Company and the Captives maintain excess property and casualty reinsurance programs with third-party insurers in an effort to limit the financial impact of significant events covered under these programs.
Our wholly owned captive insurance companies (the “Captives”) are primarily used to fund self-insured retentions ("SIRs") and deductibles for our workers’ compensation, general liability, automobile liability, rig property and a medical stop-loss program.
Offshore Gulf of Mexico Segment Our Offshore Gulf of Mexico segment has been in operation since 1968 and currently consists of seven platform rigs in the Gulf of Mexico. We supply the rig equipment and crews and the operator, who owns the platform, will typically provide production equipment or other necessary facilities.
We supply the rig equipment and crews and the operator, who owns the platform, will typically provide production equipment or other necessary facilities. 2025 FORM 10-K | 10 Table of Contents As of September 30, 2025, three of the seven offshore rigs were under contract.
Our automation-focused solutions and applications are enabled by our uniform digital fleet and are designed to provide additional value to our customers' well programs by providing a platform for machine-human collaboration during the drilling process to improve efficiency. Our path to autonomous drilling continues to evolve with several solutions in various stages of commercial testing.
These solutions are designed to enhance wellbore quality and placement, improve cost performance and well economics, and achieve better consistency at reduced risk. Our automation-focused solutions and applications are enabled by our uniform digital fleet that provide a platform for machine-human collaboration during the drilling process to improve efficiency.
Our North America Solutions segment contributed approximately 88.7 percent ($2.4 billion) of our consolidated operating revenues during fiscal year 2024, compared to approximately 87.7 percent ($2.5 billion) and 86.8 percent ($1.8 billion) of our consolidated operating revenues during fiscal years 2023 and 2022, respectively.
This technology is intended to address our customers' unique challenges based upon their goals and desired outcomes which will often vary from well to well, basin to basin. 2025 FORM 10-K | 9 Table of Contents Our North America Solutions segment contributed approximately 63.0 percent ($2.4 billion) of our consolidated operating revenues during fiscal year 2025, compared to approximately 88.7 percent ($2.4 billion) and 87.7 percent ($2.5 billion) of our consolidated operating revenues during fiscal years 2024 and 2023, respectively.
The industry would later refer to these rigs as super-spec rigs, which have the following specific characteristics: AC drive, minimum 1,500 horsepower drawworks, minimum of 750,000 lbs. hookload rating, 7,500 psi mud circulating system, and multiple-well pad capability.
The acquisition also strengthens our super-spec rig fleet. We have reconfigured 78 FlexRig® units into super-spec walking rigs, and will evaluate potential upgrades to select KCA Deutag rigs. 'Super-spec' standards include: AC drive, minimum 1,500 horsepower drawworks, minimum of 750,000 lbs. hookload rating, 7,500 psi mud circulating system, and multiple-well pad capability.
For example, some performance targets are set based upon days to drill a well or the number of lateral feet drilled in zone per day. We often use our automated technology solutions to assist in achieving the performance targets. The risks associated with these contracts relate to the failure to reach the agreed upon performance targets.
We often use our automated technology solutions to assist in achieving the performance targets. The risks associated with these contracts relate to the failure to reach the agreed upon performance targets. If we do not meet these targets, we will not receive additional compensation above the base dayrate.
Our core value of Actively C.A.R.E. means that we treat one another with respect. We care about each other, and from a safety perspective, our employees are committed to Controlling and Removing Exposures ("C.A.R.E.") for themselves and others. Our core value of Service Attitude means that we do our part and more for those around us.
We care about each other, and from a safety perspective, we promote Controlling and Removing Exposures (“C.A.R.E.”) for ourselves and others. • Service Attitude – We should do our part and more for those around us, to consider the needs of others and provide solutions to meet the needs of our colleagues, customers, and communities. • Innovative Spirit – We will embrace continuous improvement and are willing to try new approaches.
We designed our automation solutions to address challenges within our customers’ businesses as much of the drilling process is heavily dependent on human decision-making to design, execute and optimize crude oil and natural gas extraction.
We designed these solutions to address our customers' dependence on human decision-making to design, execute and optimize crude oil and natural gas extraction. These technologies enable us to deploy data-driven solutions that reduce variability and costs for achieving optimal outcomes.
(4) A silicon-controlled-rectifier (“SCR”) system converts alternate current (“AC”) produced by one or more AC generator sets into direct current (“DC”).
(4) A silicon-controlled-rectifier (“SCR”) system converts alternate current (“AC”) produced by one or more AC generator sets into direct current (“DC”). The SCR rigs are equipped with 3,000 horsepower drawworks to drill deep conventional wells. (5) Includes 27 rigs as of September 30, 2025 that are contracted but not earning revenue due to contract suspensions.
The company has a significant land drilling presence in the Middle East, which represents approximately two-thirds of the company’s calendar year 2023 Operating EBITDA, with additional operations in South America, Europe and Africa.
The company derives a significant portion of its revenues and cash flow from its land operations and has a substantial land drilling presence in the Middle East with additional operations in South America, Europe, and Northern Africa. In addition to its land operations, the company has asset-light offshore management contract operations in the North Sea, Angola, Azerbaijan and Canada.
H&P has employed a DE&I Principal Specialist, implemented a thriving Women of H&P Employee Resource Group, and established a DE&I Advisory Council with global employee representation. Our commitments are evidenced by formalized policies regarding equal opportunity and a discrimination-free workplace.
H&P has established an employee Culture & Belonging Council with global employee representation. These priorities are evidenced by formalized policies regarding equal opportunity and a discrimination-free workplace. 2025 FORM 10-K | 14 Table of Contents Employee Benefits, Health and Wellness We offer competitive compensation and benefits designed to support the health, well-being, and financial security of our employees.
All of our revenues in Bahrain are from a partner of the local national oil company. Australia Our operations in Australia commenced in the fourth fiscal quarter of 2023. All of our revenue in Australia is from one customer, Tamboran Resources Corporation, a publicly traded company ("Tamboran Corp."). As of September 30, 2024, we had one available rig in Australia.
All of our revenues during fiscal year 2025 were generated from expanded operations following the Acquisition. Oman drilling contracts are with international oil companies, a partner of the national oil company, and a private independent oil company. Bahrain As of September 30, 2025, we had four available rigs in Bahrain.
Our real estate investments include a shopping center containing approximately 371,000 leasable square feet and approximately 176 acres of undeveloped real estate. Our research and development endeavors include both internal development and external acquisition of developing technologies.
BENTEC™ operates four facilities that serve the energy industry. We also own and operate a limited number of commercial real estate properties located in Tulsa, Oklahoma. Our real estate investments include a shopping center containing approximately 372,000 leasable square feet and approximately 176 acres of undeveloped real estate.
Revenues generated by Australian drilling operations contributed to approximately 0.5 percent ($14.1 million) of our consolidated operating revenues in fiscal year 2024 compared to 0.1 percent ($3.4 million) in fiscal year 2023. As of September 30, 2024, we held a combined equity ownership in Tamboran Corp. of approximately 7.2 percent.
All of our revenues in Bahrain are from a partner of the local national oil company. Germany As of September 30, 2025, we had four available rigs in Germany. Revenues generated by German drilling operations within the International Solutions operating segment contributed approximately 1.0 percent ($38.8 million) of our consolidated operating revenues in fiscal year 2025.
Our North America Solutions operations are primarily located in Texas, but also traditionally operate in other states, depending on demand. Such states include: Colorado, Louisiana, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Utah, West Virginia, and Wyoming.
Refer to Note 17—Business Segments and Geographic Information for further details on our reportable segments. Our North America Solutions operations are primarily located in Texas, but also traditionally operate in other states, depending on demand. Our International Solutions operations are conducted in major international oil and gas markets, primarily in the Middle East and Latin America.
Removed
Our International Solutions operations have rigs and/or services primarily located in five international locations: Argentina, Australia, Bahrain, Colombia and the United Arab Emirates ("U.A.E."). Additionally, we commenced operations in Saudi Arabia in the first quarter of fiscal 2025. We also own and operate a limited number of commercial real estate properties located in Tulsa, Oklahoma.
Added
KCA Deutag Acquisition On January 16, 2025 (the “Closing Date” or "Acquisition Date"), H&P completed its acquisition of the entire issued share capital (the "Acquisition") of KCA Deutag International Limited ("KCA Deutag") pursuant to the Sale and Purchase Agreement (the "Purchase Agreement").
Removed
Our real estate operations and our wholly-owned captive insurance companies are included in "Other." 2024 FORM 10-K | 6 Table of Contents Pending KCA Deutag Acquisition On July 25, 2024, H&P and certain of its wholly owned subsidiaries entered into a Sale and Purchase Agreement (the "Purchase Agreement") to acquire KCA Deutag for total cash consideration of approximately $2.0 billion, which consists of the $0.9 billion unadjusted share purchase price and $1.1 billion to contemporaneously repay or redeem certain of KCA Deutag's existing debt upon consummation of the acquisition (the "Acquisition").
Added
H&P paid aggregate cash consideration of approximately $2.0 billion, which consisted of the share purchase price of $0.9 billion and $1.1 billion which was used to contemporaneously repay or redeem certain of KCA Deutag's existing debt, including, as applicable, the payment of all accrued and unpaid interest, premiums, and fees. KCA Deutag is a diverse global drilling company.
Removed
Total consideration is subject to adjustment as set forth in the Purchase Agreement. The transaction is expected to close prior to calendar 2024 year end, subject to customary closing conditions and regulatory approvals. KCA Deutag is a diverse global drilling company.
Added
Management contract operations provide services to customer platforms where the customer owns the drilling rig. KCA Deutag’s BENTEC™ (formally Kenera) business unit comprises manufacturing and engineering operations with four facilities serving the energy industry. Subsequent to September 30, 2025, we announced the rebranding of KCA Deutag’s Kenera business unit to BENTEC™.
Removed
In addition to its land operations, KCA Deutag has asset-light offshore management contract operations in the North Sea, Angola, Azerbaijan and Canada, with super major customers and long-term earnings visibility through a robust backlog. KCA Deutag’s Kenera segment comprises manufacturing and engineering businesses, including Bentec, with three facilities serving the energy industry, representing a longer-term growth opportunity.
Added
The BENTEC™ name, already recognized in the market, will now represent all products and services previously associated with Kenera and its sub-brands. Accordingly, throughout this document and in future references, Kenera will be referred to as BENTEC™.
Removed
(2) AC drive, 1,500 horsepower drawworks, 500,000 or 750,000 lbs. hookload rating, 5,000 or 7,500 psi mud circulating system, may or may not have multiple-well pad capability.
Added
Our Segments During the second quarter of fiscal year 2025, the naming convention for one of our reportable segments changed from Offshore Gulf of Mexico to Offshore Solutions. Beginning on the Closing Date, Offshore Solutions now includes the results from the acquired KCA Deutag offshore management contract operations.
Removed
(2) The FlexRig® 3WA is uniquely enhanced for mobility and agility without compromising unconventional pad drilling that advanced drilling programs require for highly complex lateral wells. Its walking capability offers the flexibility of 500ft in a straight line, or multiple rows within a 200 x 50 ft box.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeTechnology disputes and limitations on our ability to protect or enforce our intellectual property rights could negatively impact our costs, revenues, and any competitive advantage we hold. Drilling rigs use proprietary technology and equipment which can involve potential infringement of a third party’s rights, or a third party’s infringement of our rights, including patent rights.
Biggest changeDrilling rigs use proprietary technology and equipment which can involve potential infringement of a third party’s rights, or a third party’s infringement of our rights, including patent rights. The majority of the intellectual property rights relating to our drilling rigs and technology services are owned by us or certain of our supplying vendors.
If we are unable to recover or pass through a significant level of our costs or are required to change our practices related to complying with climate change regulatory requirements imposed on us, it could have a material adverse impact on our business, financial condition and results of operations.
If we are unable to recover or pass through a significant level of our costs or are required to change our practices related to complying with climate change-related regulatory requirements imposed on us, it could have a material adverse impact on our business, financial condition and results of operations.
Many aspects of our operations are subject to various laws and regulations in the jurisdictions where we operate, including those relating to drilling practices and comprehensive and frequently changing laws and regulations relating to the safety and to the protection of human health and the environment.
Many aspects of our operations are subject to various laws and regulations in the jurisdictions where we operate, including those relating to drilling practices and comprehensive and frequently changing laws and regulations relating to the safety and protection of human health and the environment.
The integration process may be subject to delays or changed circumstances, and we can give no assurance that KCA Deutag’s assets will perform in accordance with our expectations or that our expectations with respect to integration or cost savings as a result of the Acquisition will materialize.
The integration process may be subject to delays or changed circumstances, and we can give no assurance that our expectations with respect to integration or cost savings as a result of the acquisition will materialize or that KCA Deutag's assets will perform in accordance with our expectations.
The following factors, in addition to other factors described in this “Risk Factors” section and elsewhere in this Form 10-K, may have a significant impact on the market price of our common stock: • changes in customer needs, expectations or trends and our ability to maintain relationships with key customers; • our ability to implement our business strategy; • changes in our capital structure, including the issuance of additional debt; • public announcements (including the timing of these announcements) regarding our business, financial performance and prospects or new products or services, product enhancements, technological advances or strategic actions, such as acquisitions, restructurings or significant contracts, by our competitors or us; • trading activity in our stock, including portfolio transactions in our stock by us, our executive officers and directors, and significant stockholders or trading activity that results from the ordinary course rebalancing of stock indices in which we may be included; • short-interest in our common stock, which could be significant from time to time; • our inclusion in, or removal from, any stock indices; • investor perception of us and the industry and markets in which we operate; • increased focus by the investment community on sustainability practices at our company and in the oil and natural gas industry generally; • changes in earnings estimates or buy/sell recommendations by securities analysts; • whether or not we meet earnings estimates of securities analysts who follow us; • regulatory or legal developments in the United States and foreign countries where we operate; and • general financial, domestic, international, economic, and market conditions, including overall fluctuations in the U.S. equity markets. 2024 FORM 10-K | 35 Table of Contents Certain provisions of our corporate governing documents could make an acquisition of our company more difficult.
The following factors, in addition to other factors described in this “Risk Factors” section and elsewhere in this Form 10-K, may have a significant impact on the market price of our common stock: • changes in customer needs, expectations or trends and our ability to maintain relationships with key customers; • our ability to implement our business strategy; • changes in our capital structure, including the issuance of additional debt; • public announcements (including the timing of these announcements) regarding our business, financial performance and prospects or new products or services, product enhancements, technological advances or strategic actions, such as acquisitions, restructurings or significant contracts, by our competitors or us; • trading activity in our stock, including portfolio transactions in our stock by us, our executive officers and directors, and significant stockholders or trading activity that results from the ordinary course rebalancing of stock indices in which we may be included; • short-interest in our common stock, which could be significant from time to time; • our inclusion in, or removal from, any stock indices; • investor perception of us and the industry and markets in which we operate; • increased focus by the investment community on sustainability practices at our company and in the oil and natural gas industry generally; • changes in earnings estimates or buy/sell recommendations by securities analysts; • whether or not we meet earnings estimates of securities analysts who follow us; • regulatory or legal developments in the United States and foreign countries where we operate; and • general financial, domestic, international, economic, and market conditions, including overall fluctuations in the U.S. equity markets. 2025 FORM 10-K | 34 Table of Contents Certain provisions of our corporate governing documents could make an acquisition of our company more difficult.
Our future success will depend, in part, on our ability to manage our expanded business by, among other things, integrating the assets, operations and personnel of KCA Deutag in an efficient and timely manner, consolidating systems and management controls and successfully integrating relationships with customers, vendors and business partners.
Our future success will depend, in part, on our ability to manage our expanded business by, among other things, integrating the assets, operations and personnel of KCA Deutag in an efficient and timely manner, consolidating systems, internal controls and management controls and successfully integrating relationships with customers, vendors and business partners.
There have been efforts within the investment community (including investment advisors, investment fund managers, sovereign wealth funds, public pension funds, universities and individual investors) to promote the divestment of, or limit investment in, the stock of companies in the oil and gas industry.
There have been efforts within the investment community (including by investment advisors, investment fund managers, sovereign wealth funds, public pension funds, universities and individual investors) to promote the divestment of, or limit investment in, the stock of companies in the oil and gas industry.
These transactions may also affect our liquidity, consolidated results of operations and consolidated financial condition. 2024 FORM 10-K | 23 Table of Contents These transactions also involve risks, and we cannot ensure that: • any acquisitions we attempt will be completed on the terms announced, or at all; • any acquisitions would result in an increase in income or provide an adequate return of capital or other anticipated benefits; • any acquisitions would be successfully integrated into our operations and internal controls, including those related to financial reporting, disclosure and cyber and information security; • the due diligence conducted prior to an acquisition would uncover situations that could result in financial or legal exposure, or that we will appropriately quantify the exposure from known risks; • any disposition would not result in decreased earnings, revenue, or cash flow; • use of cash for acquisitions would not adversely affect our cash available for capital expenditures and other uses; or • any dispositions, investments, or acquisitions, including integration efforts, would not divert management resources.
These transactions may also affect our liquidity, consolidated results of operations and consolidated financial condition. 2025 FORM 10-K | 22 Table of Contents These transactions also involve risks, and we cannot ensure that: • any acquisitions we attempt will be completed on the terms announced, or at all; • any acquisitions would result in an increase in income or provide an adequate return of capital or other anticipated benefits; • any acquisitions would be successfully integrated into our operations and internal controls, including those related to financial reporting, disclosure and cyber and information security; • the due diligence conducted prior to an acquisition would uncover situations that could result in financial or legal exposure, or that we will appropriately quantify the exposure from known risks; • any disposition would not result in decreased earnings, revenue, or cash flow; • use of cash for acquisitions would not adversely affect our cash available for capital expenditures and other uses; or • any dispositions, investments, or acquisitions, including integration efforts, would not divert management resources.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us. Our operations are subject to many hazards inherent in the business in which we operate, including inclement weather, unplanned power outages, blowouts, explosions, well fires, loss of well control, equipment failure, computer system disruptions, pollution, and reservoir damage.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us. Our operations are subject to many hazards inherent in the business in which we operate, including inclement weather, natural disasters, unplanned power outages, blowouts, explosions, well fires, loss of well control, equipment failure, computer system disruptions, pollution, and reservoir damage.
Increases in the cost of labor, materials, parts, equipment, global transportation and logistics costs and other operational components has the potential to adversely affect our results of operations, cash flows and financial position by increasing our overall cost structure, particularly if we are unable to achieve commensurate increases in the prices we charge our customers for our services.
Increases in the cost of labor, materials, parts, equipment, global transportation and logistics costs and other operational components have the potential to adversely affect our results of operations, cash flows and financial position by increasing our overall cost structure, particularly if we are unable to achieve commensurate increases in the prices we charge our customers for our services.
We are subject to income taxes in the United States and numerous other jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes and other tax liabilities. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. We are regularly audited by tax authorities.
We are subject to income taxes in the United States and numerous other foreign and state jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes and other tax liabilities. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. We are regularly audited by tax authorities.
As of September 30, 2024, we have not experienced an ownership change and, therefore, utilization of our applicable tax attributes was not subject to an annual limitation (except for an immaterial portion thereof that we inherited in connection with an acquisition during 2017).
As of September 30, 2025, we have not experienced an ownership change and, therefore, utilization of our applicable tax attributes was not subject to an annual limitation (except for an immaterial portion thereof that we inherited in connection with an acquisition during 2017).
Since our business depends on the level of activity in the oil and natural gas industry, any improvement in or new discoveries of alternative energy technologies that increase the use of alternative forms of energy and reduce the demand for oil and natural gas could have a material adverse effect on our business, financial condition and results of operations. 2024 FORM 10-K | 27 Table of Contents Our business and results of operations may be adversely affected by foreign political, economic and social instability risks, foreign currency restrictions and devaluation, and various local laws associated with doing business in certain foreign countries.
Since our business depends on the level of activity in the oil and natural gas industry, any improvement in or new discoveries of alternative energy technologies that increase the use of alternative forms of energy and reduce the demand for oil and natural gas could have a material adverse effect on our business, financial condition and results of operations. 2025 FORM 10-K | 26 Table of Contents Our business and results of operations may be adversely affected by foreign political, economic and social instability risks, foreign currency restrictions and devaluation, and various local laws associated with doing business in certain foreign countries.
Foreign contracts may expose us to materially greater environmental liability and other claims for damages (including consequential damages) and personal injury related to our operations, or the risk that the contract may be terminated by our customer without cause on short-term notice, contractually or by governmental action, or under certain conditions that may not provide us with an early termination payment.
Foreign contracts may expose us to materially greater environmental liability and other claims for damages (including consequential damages) and personal injury related to our operations, or the risk that the contract may be terminated or suspended by our customer without cause on short-term notice, contractually or by governmental action, or under certain conditions that may not provide us with an early termination payment or standby compensation.
For example, the ongoing armed conflicts between (i) Russia and Ukraine and (ii) the conflicts in Israel and the continuation of, or any escalation in the severity of, these conflicts, has led and may continue to lead to an increase in the volatility of global oil and gas prices, which could have a corresponding negative impact on the capital expenditure of oil and gas companies as a result of the higher perceived risk.
For example, the ongoing armed conflicts between (i) Russia and Ukraine and (ii) the conflicts in the Middle East and the continuation of, or any escalation in the severity of, these conflicts, has led and may continue to lead to an increase in the volatility of global oil and gas prices, which could have a corresponding negative impact on the capital expenditure of oil and gas companies as a result of the higher perceived risk.
On July 25, 2024, we announced that we would suspend our supplemental dividend in fiscal year 2025 as a part of the Acquisition announced July 25, 2024. Our most recent quarterly base dividend declared was $0.25 per share.
On July 25, 2024, we announced that we would suspend our supplemental dividend in fiscal year 2025 as a part of the acquisition of KCA Deutag announced in July 25, 2024. Our most recent quarterly base dividend declared was $0.25 per share.
To the extent new laws are enacted or other governmental actions are taken that prohibit or restrict drilling in areas where we operate or impose additional environmental protection requirements that result in increased costs to the oil and gas industry, in general, or the drilling industry, in particular, our business or prospects could be materially adversely affected. 2024 FORM 10-K | 34 Table of Contents RISKS RELATED TO OUR COMMON STOCK AND CORPORATE STRUCTURE We may reduce or suspend our dividend in the future.
To the extent new laws are enacted or other governmental actions are taken that prohibit or restrict drilling in areas where we operate or impose additional environmental protection requirements that result in increased costs to the oil and gas industry, in general, or the drilling industry, in particular, our business or prospects could be materially adversely affected. 2025 FORM 10-K | 33 Table of Contents RISKS RELATED TO OUR COMMON STOCK AND CORPORATE STRUCTURE We may reduce or suspend our dividend in the future.
Any litigation or claims, even if fully indemnified or insured, could negatively impact our reputation among our customers and the public, and make it more difficult for us to compete effectively or obtain adequate insurance in the future. 2024 FORM 10-K | 33 Table of Contents Additional tax liabilities, limitations on our use of net operating losses and tax credits and/or our significant net deferred tax liability could affect our financial condition, income tax provision, net income, and cash flows.
Any litigation or claims, even if fully indemnified or insured, could negatively impact our reputation among our customers and the public, and make it more difficult for us to compete effectively or obtain adequate insurance in the future. 2025 FORM 10-K | 32 Table of Contents Additional tax liabilities, limitations on our use of net operating losses and tax credits and/or our significant net deferred tax liability could affect our financial condition, income tax provision, net income, and cash flows.
Any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would be a default (if not waived) and would likely result in a reduction of our credit rating, which could harm our ability to seek additional capital or restructure or refinance our indebtedness. 2024 FORM 10-K | 29 Table of Contents LEGAL AND REGULATORY RISKS The physical effects of climate change and the regulation of greenhouse gases and climate change could have a negative impact on our business.
Any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would be a default (if not waived) and would likely result in a reduction of our credit rating, which could harm our ability to seek additional capital or restructure or refinance our indebtedness. 2025 FORM 10-K | 28 Table of Contents LEGAL AND REGULATORY RISKS The physical effects of climate change and the regulation of greenhouse gases and climate change could have a negative impact on our business.
This risk is exacerbated with the advancement of technologies like artificial intelligence, which malicious third parties are using to create new, sophisticated and more frequent attacks. Furthermore, geopolitical tensions or conflicts, such as the ongoing armed conflicts between Russia and Ukraine and the conflicts in Israel, may further heighten the risk of cybersecurity attacks.
This risk is exacerbated with the advancement of technologies like artificial intelligence, which malicious third parties are using to create new, sophisticated and more frequent attacks. Furthermore, geopolitical tensions or conflicts, such as the ongoing armed conflicts between Russia and Ukraine and the conflicts in the Middle East, may further heighten the risk of cybersecurity attacks.
Similarly, our failure or perceived failure to pursue or fulfill our sustainability-focused goals, targets, and objectives, to comply with ethical, environmental, or other standards, regulations, or expectations, or to satisfy various reporting standards with respect to these matters, within the timelines we announce, or at all, could adversely affect our business or reputation, as well as expose us to government enforcement actions and private litigation. 2024 FORM 10-K | 31 Table of Contents Failure to comply with the U.S.
Similarly, our failure or perceived failure to pursue or fulfill our sustainability-focused goals, targets, and objectives, to comply with ethical, environmental, or other standards, regulations, or expectations, or to satisfy various reporting standards with respect to these matters, within the timelines we announce, or at all, could adversely affect our business or reputation, as well as expose us to government enforcement actions and private litigation. 2025 FORM 10-K | 30 Table of Contents Failure to comply with the U.S.
Our processes and controls for reporting sustainability matters may not always comply with evolving and disparate standards for identifying, quantifying, and reporting such metrics, including sustainability-related disclosures that may be required of public companies by the SEC or in-scope companies under U.S. state regulations, and such standards may change over time, which could result in significant revisions to our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future.
Our processes and controls for reporting sustainability matters may not always comply with evolving and disparate standards for identifying, quantifying, and reporting such metrics, including sustainability-related disclosures that may be required of in-scope companies under U.S. state or federal regulations, and such standards may change over time, which could result in significant revisions to our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future.
In addition to the other information included and incorporated by reference in this Form 10-K and the risk factors discussed elsewhere in this Form 10-K, the following risk factors should be carefully considered, as they could have a material adverse effect on our business, financial condition and results of operations.
In addition to the other information included and incorporated by reference in this Form 10-K and the risk factors discussed elsewhere in this Form 10-K, the following risk factors should be carefully considered and read in conjunction with the other information in this Form 10-K, as they could have a material adverse effect on our business, financial condition and results of operations.
Additionally, new technologies, services or standards could render some of our services, drilling rigs or equipment obsolete, which could reduce our competitiveness and have a material adverse impact on our business, financial condition and results of operations. 2024 FORM 10-K | 21 Table of Contents Our drilling and technology related operations are subject to a number of operational risks, including environmental and weather risks, which could expose us to significant losses and damage claims.
Additionally, new technologies, services or standards could render some of our services, drilling rigs or equipment obsolete, which could reduce our competitiveness and have a material adverse impact on our business, financial condition and results of operations. 2025 FORM 10-K | 20 Table of Contents Our drilling and technology related operations are subject to a number of operational risks, including environmental and weather risks, which could expose us to significant losses and damage claims.
Our Offshore Gulf of Mexico operations are also subject to potentially significant risks and liabilities attributable to or resulting from adverse environmental conditions, including pollution of offshore waters and related negative impact on wildlife and habitat, adverse sea conditions and platform damage or destruction due to collision with aircraft or marine vessels.
Our Offshore Solutions operations are also subject to potentially significant risks and liabilities attributable to or resulting from adverse environmental conditions, including pollution of offshore waters and related negative impact on wildlife and habitat, adverse sea conditions and platform damage or destruction due to collision with aircraft or marine vessels.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us..” 2024 FORM 10-K | 30 Table of Contents New legislation and regulatory initiatives relating to hydraulic fracturing or other aspects of the oil and gas industry could negatively impact the drilling programs of our customers and, consequently, delay, limit or reduce the services we provide.
We are not fully insured against all of these risks and our contractual indemnity provisions may not fully protect us.” 2025 FORM 10-K | 29 Table of Contents New legislation and regulatory initiatives relating to hydraulic fracturing or other aspects of the oil and gas industry could negatively impact the drilling programs of our customers and, consequently, delay, limit or reduce the services we provide.
Any violation of these laws or harm to our reputation could have a material adverse effect to our business, financial condition, reputation, or results of operations and prospects. 2024 FORM 10-K | 32 Table of Contents Government policies, mandates, and regulations specifically affecting the energy sector and related industries, regulatory policies or matters that affect a variety of businesses, taxation polices, and political instability could adversely affect our financial condition and results of operations.
Any violation of these laws or harm to our reputation could have a material adverse effect to our business, financial condition, reputation, or results of operations and prospects. 2025 FORM 10-K | 31 Table of Contents Government policies, mandates, and regulations specifically affecting the energy sector and related industries, regulatory policies or matters that affect a variety of businesses, taxation polices, and political instability could adversely affect our financial condition and results of operations.
The Gulf of Mexico experiences hurricanes and other extreme weather conditions on a frequent basis, which may increase in frequency and severity as a result of climate change.
The Gulf of America experiences hurricanes and other extreme weather conditions on a frequent basis, which may increase in frequency and severity as a result of climate change.
If a significant accident or other event occurs and is not fully covered by insurance or an enforceable or recoverable indemnity from a customer, it could have a material adverse effect on our business, financial condition and results of operations. 2024 FORM 10-K | 22 Table of Contents Our business is subject to cybersecurity and information technology system disruption risks.
If a significant accident or other event occurs and is not fully covered by insurance or an enforceable or recoverable indemnity from a customer, it could have a material adverse effect on our business, financial condition and results of operations. 2025 FORM 10-K | 21 Table of Contents Our business is subject to cybersecurity and information technology system disruption risks.
The volatility in prices and production levels are impacted by many factors beyond our control, including: • the domestic and foreign supply of, and demand for, oil, natural gas and related products; • the cost of exploring for, developing, producing and delivering oil and natural gas; • uncertainty in capital and commodities markets and the ability of oil and natural gas producers to access capital; • the availability of and constraints in storage and transportation capacity, including, for example, takeaway constraints experienced in the Permian Basin over the past several years; • the worldwide economy; • expectations about future oil and natural gas prices and production levels; • local and international political, economic, health and weather conditions, especially in oil and natural gas producing countries, including, for example, the impacts of local and international pandemics and other disasters; • actions of OPEC, its members and other oil producing nations, such as Russia, relating to oil price and production levels, including announcements of potential changes to such levels; • the levels of production of oil and natural gas of non-OPEC countries; • the continued development of shale plays which may influence worldwide supply and prices; • tax policies of the United States and other countries involved in global energy markets; • political and military conflicts, hostilities or perceived hostilities in oil producing regions or other geographical areas or acts of terrorism in the United States or elsewhere; • technological advances that are related to oil and natural gas recovery or that affect the global demand for energy; • the development, exploitation and market acceptance of alternative energy sources as part of a transition to a lower carbon economy; 2024 FORM 10-K | 19 Table of Contents • increased focus by the investment community on sustainability practices in the oil and natural gas industry; • legal and other limitations or restrictions on exportation and/or importation of oil and natural gas; • laws and governmental regulations affecting the use of oil and natural gas; and • the environmental and other laws and governmental regulations affecting exploration and development of oil and natural gas reserves.
The volatility in prices and production levels are impacted by many factors beyond our control, including: • the domestic and foreign supply of, and demand for, oil, natural gas and related products; • the cost of exploring for, developing, producing and delivering oil and natural gas; • uncertainty in capital and commodities markets and the ability of oil and natural gas producers to access capital; • the availability of and constraints in storage and transportation capacity, including, for example, takeaway constraints experienced in the Permian Basin over the past several years; • the worldwide economy; • expectations about future oil and natural gas prices and production levels (including as a result of certain economic initiatives, such as those related to artificial intelligence); • local and international political, economic, health and weather conditions, especially in oil and natural gas producing countries, including, for example, the impacts of local and international pandemics and other disasters; • actions of OPEC, its members and other oil producing nations, such as Russia, relating to oil price and production levels, including announcements of potential changes to such levels; • the levels of production of oil and natural gas of non-OPEC countries; • the continued development of shale plays which may influence worldwide supply and prices; • tax, trade and tariff policies of the United States and other countries involved in global energy markets; • political and military conflicts, hostilities or perceived hostilities in oil producing regions or other geographical areas or acts of terrorism in the United States or elsewhere; • technological advances that are related to oil and natural gas recovery or that affect the global demand or supply for energy; • the development, exploitation and market acceptance of alternative energy sources as part of a transition to a lower carbon economy; 2025 FORM 10-K | 18 Table of Contents • focus by the investment community on sustainability practices in the oil and natural gas industry; • legal and other limitations or restrictions on exportation and/or importation of oil and natural gas; • laws and governmental regulations affecting the use of oil and natural gas; and • the environmental and other laws and governmental regulations affecting exploration and development of oil and natural gas reserves.
Our Offshore Gulf of Mexico operations may also be negatively affected by a blowout or an uncontrolled release of oil or hazardous substances by third parties whose offshore operations are unrelated to our operations. We operate several platform rigs in the Gulf of Mexico.
Our Offshore Solutions operations may also be negatively affected by a blowout or an uncontrolled release of oil or hazardous substances by third parties whose offshore operations are unrelated to our operations. We operate several platform rigs in the Gulf of America.
Such restrictions may limit our ability to successfully execute our business plans, which may have adverse consequences on our operations. 2024 FORM 10-K | 28 Table of Contents We may be required to record impairment charges with respect to our drilling rigs and other assets.
Such restrictions may limit our ability to successfully execute our business plans, which may have adverse consequences on our operations. 2025 FORM 10-K | 27 Table of Contents We may be required to record impairment charges with respect to our drilling rigs and other assets.
Public health crises, pandemics and epidemics, such as the COVID-19 pandemic, and fear of such events have adversely impacted and may in the future again adversely impact our operations, the operations of our customers and the global economy, including worldwide demand for oil and natural gas and the level of demand for our services.
Public health crises, pandemics and epidemics and fear of such events have adversely impacted and may in the future again adversely impact our operations, the operations of our customers and the global economy, including worldwide demand for oil and natural gas and the level of demand for our services.
As a result, we or our customers may become subject to court orders compelling a reduction of GHG emissions or requiring mitigation of the effects of climate change.
As a result, we or our customers may become subject to court orders compelling a reduction of GHG emissions or requiring financial, actual, or other mitigation of the effects of climate change.
In the past, global economic conditions, and expectations for future global economic conditions, have sometimes experienced significant deterioration in a relatively short period of time and there can be no assurance that global economic conditions or expectations for future global economic conditions will recover in the near term or not quickly deteriorate again due to one or more factors.
In the past, global economic conditions, and expectations for future global economic conditions, have sometimes significantly deteriorated in a relatively short period of time and there can be no assurance that global economic conditions or expectations for future global economic conditions will recover in the near term or not quickly deteriorate again due to one or more factors.
Our aggregate foreign currency losses across all of our operations for fiscal years 2024, 2023 and 2022 were $5.5 million, $6.4 million and $5.9 million, respectively.
Our aggregate foreign currency losses across all of our operations for fiscal years 2025, 2024 and 2023 were $9.7 million, $5.5 million and $6.4 million, respectively.
If the Acquisition is consummated, we may be unable to successfully integrate KCA Deutag’s business or achieve the anticipated benefits of the Acquisition, or the anticipated benefits attributable to the Acquisition may vary from our expectations.
We may be unable to successfully integrate KCA Deutag’s business or achieve the anticipated benefits of the acquisition, or the anticipated benefits attributable to the acquisition may vary from our expectations.
Nonetheless, all of our foreign operations use the U.S. dollar as the functional currency and local currency monetary assets and liabilities are remeasured into U.S. dollars with gains and losses resulting from foreign currency transactions included in current results of operations. For fiscal year 2024, we recognized aggregate foreign currency losses of $5.1 million in Argentina.
Nonetheless, all of our foreign operations use the U.S. dollar as the functional currency and local currency monetary assets and liabilities are remeasured into U.S. dollars with gains and losses resulting from foreign currency transactions included in current results of operations. For fiscal year 2025, we recognized aggregate foreign currency losses of $3.8 million in Argentina.
At September 30, 2024, we had approximately 25 rigs placed on federal land and four rigs in federal waters. Any new laws, regulations or permitting requirements regarding hydraulic fracturing could negatively impact the drilling programs of our customers and, consequently, delay, limit or reduce the services we provide.
At September 30, 2025, we had approximately 37 rigs placed on federal land and three rigs in federal waters. Any new laws, regulations or permitting requirements regarding hydraulic fracturing could negatively impact the drilling programs of our customers and, consequently, delay, limit or reduce the services we provide.
Accordingly, a decline in revenue due to lower dayrates and/or utilization may not be offset by a corresponding decrease in drilling services and solutions expense, which could have a material adverse impact on our business, financial condition and results of operations. Shortages of drilling equipment, supplies or other key materials could adversely affect our operations.
Accordingly, a decline in revenue due to lower dayrates and/or utilization may not be offset by a corresponding decrease in drilling services and solutions expense, which could have a material adverse impact on our business, financial condition and results of operations. 2025 FORM 10-K | 25 Table of Contents Shortages of drilling equipment, supplies or other key materials could adversely affect our operations.
Further, our responses to any union organizing efforts could negatively impact our reputation and have adverse effects on our business, financial condition and results of operations. The impact and effects of public health crises, pandemics and epidemics, such as the COVID-19 pandemic, could have a material adverse effect on our business, financial condition and results of operations.
Further, our responses to any union organizing efforts could negatively impact our reputation and have adverse effects on our business, financial condition and results of operations. The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations.
If our sustainability practices do not meet investor or other stakeholder expectations and standards, which continue to evolve, our reputation, our ability to attract or retain employees or customers, and our attractiveness as an investment or business partner could be negatively affected.
Our sustainability practices cannot meet all investor or other stakeholder expectations and standards, which continue to evolve, and our reputation, our ability to attract or retain employees or customers, and our attractiveness as an investment or business partner could be negatively affected.
These significant financial penalties for noncompliance may materially adversely affect our business, results of operations and revenue. Similar legislation has been adopted in a number of other states, and is being considered by others.
Significant financial penalties imposed by the CCPA/CPRA for noncompliance may materially adversely affect our business, results of operations and revenue. Similar legislation has been adopted in a number of other states, and is being considered by others.
However, if we are not able to effectively manage these disruptions and delays in the future, they could have a material adverse effect on our business, financial condition and results of operations. 2024 FORM 10-K | 26 Table of Contents Continuing inflation and cost increases may impact our sales margins and profitability.
However, if we are not able to effectively manage these disruptions and delays in the future, they could have a material adverse effect on our business, financial condition and results of operations. Continuing inflation and cost increases may impact our sales margins and profitability.
Remote work relies heavily on the use of remote networking and online conferencing services that enable employees to work outside of our corporate infrastructure and, in some cases, use their own personal devices, which exposes the Company to additional cybersecurity risks.
In addition, a significant number of our employees now work remotely. Remote work relies heavily on the use of remote networking and online conferencing services that enable employees to work outside of our corporate infrastructure and, in some cases, use their own personal devices, which exposes the Company to additional cybersecurity risks.
As a result, any technology disputes involving us or our customers or supplying vendors or limitations on our ability to protect or enforce our intellectual property rights could have a material adverse impact on our business, financial condition and results of operations. 2024 FORM 10-K | 24 Table of Contents Unexpected events could disrupt our business and adversely affect our results of operations.
As a result, any technology disputes involving us or our customers or supplying vendors or limitations on our ability to protect or enforce our intellectual property rights could have a material adverse impact on our business, financial condition and results of operations. Unexpected events could disrupt our business and adversely affect our results of operations.
The federal government and certain state governments have enacted, and are expected to continue to enact, laws and regulations that mandate or provide economic incentives for the development of technologies and sources of energy other than oil and gas, such as wind and solar.
Governments have enacted, and may continue to enact, laws and regulations that mandate or provide economic incentives for the development of technologies and sources of energy other than oil and gas, such as wind and solar.
We currently have drilling operations in South America (primarily Argentina and Colombia), the Middle East and Australia. We expect the Acquisition to increase the geographic reach of our operations. In the future, we may further expand the geographic reach of our operations.
We currently have drilling operations in South America (primarily Argentina and Colombia), the Middle East, Europe, Africa and Australia. In the future, we may further expand the geographic reach of our operations.
There has been an increasing focus of international, national, state, regional and local regulatory bodies on emissions of certain gases, commonly referred to as “greenhouse gases” (“GHGs”) including carbon dioxide and methane, and climate change issues. Legislation to regulate GHG emissions has periodically been introduced in the U.S. Congress and such legislation may be proposed or adopted in the future.
In recent years, international, national, state, regional and local regulatory bodies have focused on emissions of certain gases, commonly referred to as “greenhouse gases” (“GHGs”) including carbon dioxide and methane, and climate change issues. Legislation to regulate GHG emissions has periodically been introduced, and such legislation may be proposed or adopted in the future.
However, more aggressive efforts by governments and non-governmental organizations to reduce GHG emissions have occurred and may continue based on the findings set forth in the IPCC Reports and any such future laws and regulations could result in increased compliance costs, reduce our return on investment, or additional operating restrictions or affect the demand for our customers' products and, accordingly, our services.
However, more aggressive efforts by governments and non-governmental organizations to reduce GHG emissions have occurred and may continue based on the findings set forth in the IPCC Reports and any such future laws and regulations could result in increased compliance costs, reduced returns on investment, or additional operating restrictions.
Regardless of the reason for an early termination or suspension of a contract, such termination or suspension may result in a drilling rig being idle for an extended period of time if we are unable to secure new contracts on a timely basis and on substantially similar terms, which could have a material adverse effect on our business, financial condition and results of operations.
Regardless of the reason for an early termination or suspension of a contract, such termination or suspension can lead to a drilling rig being idle for an extended period if we cannot promptly secure new contracts on substantially similar terms, which could have a material adverse effect on our business, financial condition and results of operations.
These obstacles may include a less familiar geopolitical landscape, new customers with whom we have no established relationship, pressure from local governments to hire local employees, use local suppliers or to direct business to nationalized companies, unfamiliar operating conditions and a distinct regulatory environment.
Certain aspects related to operating in these new regions may present new obstacles including a less familiar geopolitical landscape, new customers with whom we have less established relationships, pressure from local governments to hire local employees, use local suppliers or to direct business to nationalized companies, unfamiliar operating conditions and a distinct regulatory environment.
The majority of the intellectual property rights relating to our drilling rigs and technology services are owned by us or certain of our supplying vendors. From time to time, we or our customers or supplying vendors become involved in disputes over infringement of intellectual property rights relating to equipment or technology owned or used by us.
From time to time, we or our customers or supplying vendors become involved in disputes over infringement of intellectual property rights relating to equipment or technology owned or used by us.
We have allocated a portion of the purchase price of certain acquisitions to goodwill and other intangible assets. The amount allocated to goodwill is the excess of the purchase price over the net identifiable assets acquired. At September 30, 2024, we had goodwill of $45.7 million and other intangible assets, net of $54.1 million.
We have allocated a portion of the purchase price of certain acquisitions to goodwill and other intangible assets. The amount allocated to goodwill is the excess of the purchase price over the net identifiable assets acquired. At September 30, 2025, we had goodwill of $182.9 million and other intangible assets, net of $485.5 million.
In addition, increasing attention to the risks of climate change has resulted in an increased possibility of litigation or investigations brought by public and private entities against oil and gas companies in connection with their GHG emissions.
They may also affect the demand for our customers' products and, accordingly, our services. In addition, increasing attention to the risks of climate change has resulted in an increased possibility of litigation, legislation, or investigations brought by public and private entities against oil and gas companies in connection with their GHG emissions.
It is possible that a court could find these exclusive forum provisions inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, and we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and Board of Directors. 2024 FORM 10-K | 36 Table of Contents Public and investor sentiment towards climate change, fossil fuels and other ESG matters could adversely affect our cost of capital and the price of our common stock.
It is possible that a court could find these exclusive forum provisions inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, and we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and Board of Directors.
As of September 30, 2024, 92 of our available rigs were not under contract. 2024 FORM 10-K | 20 Table of Contents Further, as a result of any significant reduction in the demand for oil and natural gas services, certain of our competitors may engage in bankruptcy proceedings, debt refinancing transactions, management changes, or other strategic initiatives in an attempt to reduce operating costs to maintain a position in the market.
Further, as a result of any significant reduction in the demand for oil and natural gas services, certain of our competitors may engage in bankruptcy proceedings, debt refinancing transactions, management changes, or other strategic initiatives in an attempt to reduce operating costs to maintain a position in the market.
We currently own and operate rigs and have deployed technology under contracts with foreign national oil companies. In the future, we may expand our international solutions operations and enter into additional, significant contracts with national oil companies.
Our contracts with NOCs may expose us to greater risks than we normally assume in contracts with non-governmental customers. We currently own and operate rigs and have deployed technology under contracts with foreign national oil companies. In the future, we may expand our International Solutions operations and enter into additional, significant contracts with national oil companies.
In fiscal year 2024, we received approximately 58.2 percent of our consolidated operating revenues from our ten largest drilling services and solutions customers and approximately 27.3 percent of our consolidated operating revenues from our three largest customers (including their affiliates).
In fiscal year 2025, we received approximately 54.0 percent of our consolidated operating revenues from our ten largest drilling services and solutions customers (including their affiliates) and approximately 25.6 percent of our consolidated operating revenues from our three largest drilling services and solutions customers (including their affiliates).
See “—Consolidation in our industry may impact our results of operations” for additional disclosure regarding consolidations in our industry. Our current backlog of drilling services and solutions revenue may decline and may not be ultimately realized as fixed‑term contracts and may, in certain instances, be terminated without an early termination payment.
See “—Consolidation in our industry may impact our results of operations” for additional disclosure regarding consolidations in our industry. 2025 FORM 10-K | 24 Table of Contents Our current backlog of drilling services and solutions revenue may decline and may not be fully realized as fixed‑term contracts and, in certain instances, these contracts can be terminated without an early termination payment or suspended without standby or force majeure compensation.
It is not possible at this time to predict the timing and effect of climate change or the extent and contents of any additional GHG legislation, regulations or other measures adopted at the federal, state or local levels.
It is not possible at this time to fully predict the timing and effect of climate change or the extent and contents of any additional GHG legislation, regulations or other measures adopted by governments that may impact our business.
Fixed‑term drilling contracts customarily provide for a termination by the customer for convenience, default, or extended force majeure. An “early termination payment” is typically paid to us if a contract is terminated prior to the expiration of the fixed term.
Fixed‑term drilling contracts typically allow customers to terminate the agreement early for convenience, default, or extended force majeure events. An “early termination payment” is usually owed to us if a contract is terminated prior to expiration of the fixed term.
We have evaluated the potential impacts of Pillar Two and do not believe it will have a material adverse effect on our tax liability. Our deferred tax liability associated with property, plant and equipment is significant, which could materially increase the amount of cash income taxes that we pay in the future and, thus, adversely affect our cash flows.
Our deferred tax liability associated with property, plant and equipment is significant, which could materially increase the amount of cash income taxes that we pay in the future and, thus, adversely affect our cash flows.
If one or more of our larger customers terminated their contracts, failed to renew existing contracts with us, or refused to award us with new contracts, it could have a material adverse effect on our business, financial condition and results of operations. Further, consolidation among oil and natural gas exploration and production companies may reduce the number of available customers.
If one or more of our larger customers terminated their contracts, failed to renew existing contracts with us, suspended active contracts for a prolonged period or refused to award us with new contracts, it could have a material adverse effect on our business, financial condition and results of operations.
If these future laws and regulations result in customers reducing their production of oil and gas, they could ultimately have an adverse effect on our business and prospects.
Such legislation incentivizes the development, use and investment in these technologies and alternative energy sources and could accelerate the shift away from traditional oil and gas. If these future laws and regulations result in customers reducing their production of oil and gas, they could ultimately have an adverse effect on our business and prospects.
This could result in such competitors emerging with stronger or healthier balance sheets and in turn an improved ability to compete with us in the future.
This could result in such competitors emerging with stronger or healthier balance sheets and in turn an improved ability to compete with us in the future. 2025 FORM 10-K | 19 Table of Contents Consolidation in our industry may impact our results of operations.
In addition, during periods of depressed market conditions we may be subject to an increased risk of our customers, vendors, former employees and others initiating legal proceedings against us. Further, actions or decisions we have taken or may take as a consequence of COVID-19 may result in investigations, litigation or legal claims against us.
In addition, during periods of depressed market conditions we may be subject to an increased risk of our customers, vendors, former employees and others initiating legal proceedings against us. Lawsuits or claims against us could have a material adverse effect on our business, financial condition and results of operations.
There has also been pressure on lenders and other financial services companies to limit or curtail financing of companies in the oil and gas industry. Because we operate within the oil and gas industry, if these efforts continue or expand, our stock price and our ability to raise capital may be negatively impacted.
There has also been pressure on lenders and other financial services companies to limit or curtail financing of companies in the oil and gas industry.
Further, we may experience difficulties in collecting from our insurers or our insurers may deny all or a portion of our claims for insurance coverage.
No assurance can be given that insurance coverage will continue to be available at rates considered reasonable or that our coverage will respond to a specific loss. Further, we may experience difficulties in collecting from our insurers or our insurers may deny all or a portion of our claims for insurance coverage.
From time to time we are able to increase our prices, but we may not be able to do so at a rate that is sufficient to offset rising costs. The inability to maintain our pricing and to increase our pricing as costs increase to offset rising costs and capital expenditures could adversely affect our rig utilization and profit margins.
The inability to maintain our pricing and to increase our pricing as costs increase to offset rising costs and capital expenditures could adversely affect our rig utilization and profit margins.
Some members of the investment community have increased their focus on ESG practices and disclosures by public companies, including practices and disclosures related to climate change and sustainability, DE&I initiatives, and heightened governance standards. As a result, we may continue to face pressure regarding our ESG disclosures and practices.
Because we operate within the oil and gas industry, if these efforts continue or expand, our stock price and our ability to raise capital may be negatively impacted. 2025 FORM 10-K | 35 Table of Contents Some members of the investment community have increased their focus on ESG practices and disclosures by public companies, including practices and disclosures related to climate change and sustainability, DE&I initiatives, and heightened governance standards.
We periodically seek to increase the prices on our services to offset rising costs, earn returns on our capital investment and otherwise generate higher returns for our stockholders. However, we operate in a very competitive industry and we are not always successful in raising or maintaining our existing prices.
We operate in a very competitive industry, and we are not always successful in raising or maintaining our existing prices. From time to time we are able to increase our prices, but we may not be able to do so at a rate that is sufficient to offset rising costs.
As of September 30, 2024, our drilling services backlog was approximately $1.5 billion for future revenues under firm commitments.
As of September 30, 2025, our drilling services backlog was approximately $4.8 billion for future revenues under firm commitments. Our drilling services backlog may decline over time if existing contract term coverage is not replaced by new term contracts or price modifications for existing contracts.
Failure to successfully manage the combined operations may have an adverse effect on our business, reputation, financial condition and results of operations. 2024 FORM 10-K | 38 Table of Contents Our business relationships may be subject to disruption due to uncertainty associated with the Acquisition, which could have a material adverse effect on our results of operations, cash flows and financial position pending and following the Acquisition.
Failure to successfully manage the combined operations may have an adverse effect on our business, reputation, financial condition and results of operations. 2025 FORM 10-K | 23 Table of Contents Technology disputes and limitations on our ability to protect or enforce our intellectual property rights could negatively impact our costs, revenues, and any competitive advantage we hold.
Even if an early termination payment is owed to us, during depressed market conditions or due to other factors, a customer may be unable or may refuse to pay the early termination payment and may seek to suspend, negotiate, or terminate the contract.
Even in cases where such payment is owed, customers may be unable or unwilling to pay it during depressed market conditions and may seek to suspend, negotiate, or terminate the contract instead. Additionally, some drilling contracts within our recently acquired KCA Deutag subsidiary do not include provisions for early termination payments or compensation for drilling suspension.
Our operations have historically focused on North America and the Offshore Gulf of Mexico, and we also have existing operations internationally in Argentina, Bahrain, Colombia, the U.A.E. and Australia. The Acquisition represents an expansion into Europe and Africa and a broader presence in the Middle East.
As a result of the KCA Deutag acquisition, we have also recently expanded operations into Europe and Africa and have increased our presence in the Middle East.
The United States is currently a member of the “Paris Agreement” that requires member countries to review and “represent a progression” in their intended nationally determined GHG contributions, which set many new goals, including GHG emission reduction goals every five years beginning in 2020.
In recent years, the United States has twice entered into and withdrawn from the “Paris Agreement” that requires member countries to review and “represent a progression” in their intended nationally determined GHG contributions. Recent changes in, and resulting uncertainty around, the United States' approach to climate change and GHG regulation further complicate efforts to prepare for future policy changes.
Our inability or the inability of our customers to perform under our or their contractual obligations may have a material adverse impact on our business, financial condition and results of operations. 2024 FORM 10-K | 25 Table of Contents Our contracts with NOCs may expose us to greater risks than we normally assume in contracts with non-governmental customers.
Factors, such as low or declining oil prices and reduced capital spending by our customers can contribute to this decline. Our inability or the inability of our customers to meet contractual obligations may have a material adverse impact on our business, financial condition and results of operations.
Removed
We may also see corporate consolidations among our competitors and customers, which could significantly alter industry conditions and competition within the industry, and have a material adverse effect on our business, financial condition and results of operations. Consolidation in our industry may impact our results of operations.
Added
As of September 30, 2025, 132 of our available rigs were not under contract.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

9 edited+1 added−2 removed7 unchanged
Biggest changeThe VP-IT reports directly to our Senior Vice President of Information Technology and Engineering, who provides oversight of cybersecurity risk and mitigation strategies. Our cybersecurity and information technology teams actively maintain a register of risks and mitigation measures under the umbrella of our enterprise risk management program.
Biggest changeManagement Our CISO has over 20 years of experience in information security and global compliance. The CISO reports directly to our Senior Vice President of Information Technology and Engineering, who provides oversight of cybersecurity, risk, mitigation strategies, and governance.
Our Enterprise Risk Management Committee, which meets quarterly, is comprised of our executive officers, Senior Vice President of Information Technologies and Engineering, Chief Accounting Officer, Vice President of Internal Audit, Corporate Secretary, and Director – Risk Management & Insurance.
Our Enterprise Risk Management Committee, which meets quarterly, is comprised of our executive officers, Senior Vice President of Information Technologies and Engineering, CISO, Chief Accounting Officer, Vice President of Internal Audit, Corporate Secretary, and Director – Risk Management & Insurance.
The Cyber Committee’s responsibilities include: • providing feedback and direction to our information technology teams on incident investigations • coordinating other departments, consultants, and advisors as needed • communicating with our executive officer team, Disclosure Committee, independent auditor, and the Chair of the Audit Committee • initiating the materiality determination methodology and assessing materiality of incidents (quantitative and qualitative) • based on materiality analysis, making a recommendation to the Chief Executive Officer and Chief Financial Officer that an incident should be deemed material Material Cybersecurity Risks and Threats Risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected us, including our business strategy, results of operations or financial condition, and we do not believe that such risks are reasonably likely to have such an effect over the long term.
The Cyber Committee’s responsibilities include: • providing feedback and direction to our information technology teams on incident investigations • coordinating other departments, consultants, and advisors as needed • communicating with our executive officer team, Disclosure Committee, independent auditor, and the Chair of the Audit Committee • initiating the materiality determination methodology and assessing materiality of incidents (quantitative and qualitative) • based on materiality analysis, making a recommendation to the Chief Executive Officer and Chief Financial Officer that an incident should be deemed material 2025 FORM 10-K | 37 Table of Contents Material Cybersecurity Risks and Threats Risks from cybersecurity threats, including any previous cybersecurity incidents, have not materially affected us, including our business strategy, results of operations or financial condition, and we do not believe that such risks are reasonably likely to have such an effect over the long term.
Cybersecurity Program Our cybersecurity program includes, among other things: • ongoing monitoring of systems for security threats at a base level • an internal team that focuses on higher level threats and conducts threat hunting activities • monitoring of the cyber threat landscape using a variety of sources, including engagement with domestic and international governmental security agencies, and industry groups • periodic engagement of third parties to test for vulnerabilities in our information technology systems, assess cybersecurity risk levels, and assess our cybersecurity policies and framework • compliance audits of our information technology processes by our internal audit team, which also monitors the progress of any remediation activities • employee training to raise awareness of cyber risks and behaviors that increase vulnerabilities • periodic exercises to test information technology security protocols • periodic exercises to test information security protocols to enhance crises management readiness and business continuity capabilities • systems and processes designed to assess, oversee, identify, and reduce the potential impact of a security incident at a third-party vendor, service provider or customer or otherwise implicating the third-party technology and systems we use • overseeing alignment with customer cybersecurity requirements • a Cybersecurity Incident Reporting process Cybersecurity Incident Reporting Process (“CIR Process”) Our CIR Process is a formalized approach following the NIST framework for evaluating cybersecurity incidents and prioritizing response efforts based on established criteria.
The Director of Risk Management and Insurance reports to the Audit Committee and full Board on a quarterly basis. 2025 FORM 10-K | 36 Table of Contents Cybersecurity Program Our cybersecurity program includes, among other things: • ongoing monitoring of systems for security threats at a base level • an internal team that focuses on higher level threats and conducts threat hunting activities • monitoring of the cyber threat landscape using a variety of sources, including engagement with domestic and international governmental security agencies, and industry groups • periodic engagement of third parties to test for vulnerabilities in our information technology systems, assess cybersecurity risk levels, and assess our cybersecurity policies and framework • compliance audits of our information technology processes by our internal audit team, which also monitors the progress of any remediation activities • employee training to raise awareness of cyber risks and behaviors that increase vulnerabilities • periodic exercises to test information technology security protocols • periodic exercises to test information security protocols to enhance crises management readiness and business continuity capabilities • systems and processes designed to assess, oversee, identify, and reduce the potential impact of a security incident at a third-party vendor, service provider or customer or otherwise implicating the third-party technology and systems we use • overseeing alignment with customer cybersecurity requirements • a Cybersecurity Incident Reporting process Cybersecurity Incident Reporting Process (“CIR Process”) Our CIR Process is a formalized approach following the NIST framework for evaluating cybersecurity incidents and prioritizing response efforts based on established criteria.
The key components of the CIR Process includes: • cybersecurity incident prioritization • timelines and communications protocols, including establishing reporting thresholds pursuant to which incidents are escalated within the Company, and, where appropriate, reported promptly to the Cyber Review Committee, the Audit Committee Chairman, the Chief Executive Officer and Chief Financial Officer, and the Board of Directors • procedures related to our Cyber Review Committee described below • a formalized methodology for evaluating the impact of cybersecurity incidents 2024 FORM 10-K | 41 Table of Contents The Cyber Review Committee (“Cyber Committee”) is a sub-committee of our Disclosure Committee comprised of our Chief Accounting Officer; Senior Vice President of Information Technology and Engineering; General Counsel; Vice President – Investor Relations; Director – Risk Management & Insurance; and Director – Global Security & Administration.
The key components of the CIR Process include: • Cybersecurity incident prioritization • Timelines and communications protocols, including establishing reporting thresholds pursuant to which incidents are escalated within the Company, and, where appropriate, reported promptly to the Cyber Review Committee, the Audit Committee Chairman, the Chief Executive Officer and Chief Financial Officer, and the Board of Directors • Procedures related to our Cyber Review Committee described below • A formalized methodology for evaluating the impact of cybersecurity incidents The Cyber Review Committee (“Cyber Committee”) is a sub-committee of our Disclosure Committee comprised of our Chief Accounting Officer; Senior Vice President of Information Technology and Engineering; CISO; general counsels; Vice President – Investor Relations; Director – Risk Management & Insurance; and Vice President – Global Security & Administration.
The cybersecurity program is part of our broader enterprise risk management program. Risk Management and Governance Board of Directors Our Board of Directors (“Board”) and its committees oversee the risk management functions of the Company. Our Audit Committee plays a significant role in oversight of risks, including cybersecurity.
Risk Management and Governance Board of Directors Our Board of Directors (“Board”) and its committees oversee the risk management functions of the Company. Our Audit Committee plays a significant role in oversight of risks, including cybersecurity.
At least quarterly, the Audit Committee receives an update on cybersecurity matters from the Company’s Senior Vice President of Information Technologies and Engineering and our information security leadership.
At least quarterly, the Audit Committee receives an update on cybersecurity matters from the Company’s Senior Vice President of Information Technologies and Engineering and our Vice President & Global Chief Information Security Officer (“CISO”).
Additionally, the Company’s Cybersecurity Incident Reporting process (described below), provides that potentially significant cybersecurity incidents be promptly reported to the Chairman of the Audit Committee, who will also receive ongoing updates regarding any such incident as appropriate.
Additionally, the Company’s Cybersecurity Incident Reporting process (described below), provides that potentially significant cybersecurity incidents be promptly reported to the Chairman of the Audit Committee, who will also receive ongoing updates regarding any such incident as appropriate. Cybersecurity incidents determined to be material are reported to the Board of Directors promptly following such determination.
Our Risk Management and Insurance Department is responsible for the implementation of our enterprise risk management program and maintains a register of risks and initiates reviews and assessments. The Director of Risk Management and Insurance reports to the Audit Committee and full Board on a quarterly basis.
Our Risk Management and Insurance Department is responsible for the implementation of our enterprise risk management program and maintains a register of risks and initiates reviews and assessments.
Removed
Cybersecurity incidents determined to be material are reported to the Board of Directors promptly following such determination. 2024 FORM 10-K | 40 Table of Contents Management Our Director of IT Governance and Response, who manages our cybersecurity program, is currently on leave and expects to retire from the Company in January 2025.
Added
Our CISO oversees an internal cross-functional information technology governance, risk, and compliance team that actively maintains a register of risks and mitigation measures under the umbrella of our enterprise risk management program.
Removed
During this time and until we appoint a new Director of IT Governance and Response, our Vice President - Information Technology ("VP-IT"), who has extensive cybersecurity knowledge and skills gained from 25 years of information technology work experience at the Company and elsewhere, has assumed responsibilities for this role with the assistance of a third party security leadership service.

Item 2. Properties

Properties — owned and leased real estate

1 edited+2 added−0 removed2 unchanged
Biggest changeIn addition, we lease a fabrication and assembly facility in Galena Park, Texas as well as a maintenance and overhaul facility near Tulsa, Oklahoma. We also own a limited number of commercial real estate properties located in Tulsa, Oklahoma for investment purposes. Our real estate investments include a shopping center and undeveloped real estate.
Biggest changeWe also own a limited number of commercial real estate properties located in Tulsa, Oklahoma for investment purposes. Our real estate investments include a shopping center and undeveloped real estate.
Added
Additionally, we lease a fabrication and assembly facility in Galena Park, Texas as well as a maintenance and overhaul facility near Tulsa, Oklahoma. We own a manufacturing and office facility in Bad Bentheim, Germany, and lease fabrication and assembly facilities in both Oman and Saudi Arabia.
Added
During the fiscal year ended September 30, 2025, we committed to a plan to sell a significant portion of our real estate portfolio, including a shopping center comprised of approximately 371,000 leasable square feet with a net book value of $12.0 million.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+0 added−0 removed2 unchanged
Biggest changeIndexed Returns Base Period Years Ending Company / Index Sep 2019 Sep 2020 Sep 2021 Sep 2022 Sep 2023 Sep 2024 Helmerich & Payne, Inc. $ 100.00 $ 43.00 $ 77.00 $ 103.00 $ 121.00 $ 96.00 S&P 600 Index 100.00 92.00 145.00 117.00 129.00 163.00 Dow Jones U.S.
Biggest changeIndexed Returns Base Period Years Ending Company / Index Sep 2020 Sep 2021 Sep 2022 Sep 2023 Sep 2024 Sep 2025 Helmerich & Payne, Inc. $ 100.00 $ 194.00 $ 266.00 $ 315.00 $ 246.00 $ 196.00 S&P 600 Index 100.00 158.00 128.00 141.00 177.00 184.00 Dow Jones U.S.
Payment of future dividends will depend on earnings and other factors and is subject to Board approval. 2024 FORM 10-K | 43 Table of Contents Performance Graph The following performance graph reflects the yearly percentage change in our cumulative total stockholder return on common stock as compared with the cumulative total return on the S&P 600 Index, Dow Jones U.S.
Payment of future dividends will depend on earnings and other factors and is subject to Board approval. 2025 FORM 10-K | 39 Table of Contents Performance Graph The following performance graph reflects the yearly percentage change in our cumulative total stockholder return on common stock as compared with the cumulative total return on the S&P 600 Index, Dow Jones U.S.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information and Dividends The principal market on which our common stock is traded is the New York Stock Exchange under the ticker symbol “HP.” As of November 6, 2024, there were 331 record holders of our common stock as listed by our transfer agent’s records.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information and Dividends The principal market on which our common stock is traded is the New York Stock Exchange under the ticker symbol “HP.” As of November 10, 2025, there were 313 record holders of our common stock as listed by our transfer agent’s records.
Select Oil Equipment & Services Index 100.00 43.00 82.00 87.00 148.00 126.00 Philadelphia Stock Exchange Oil Service Sector Index 100.00 43.00 90.00 97.00 155.00 128.00 The above performance graph and related information shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act or to the liabilities of Section 18 of the Exchange Act, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent we specifically incorporate it by reference into such a filing.
Select Oil Equipment & Services Index 100.00 193.00 205.00 348.00 296.00 291.00 Philadelphia Stock Exchange Oil Service Sector Index 100.00 207.00 223.00 357.00 295.00 259.00 The above performance graph and related information shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act or to the liabilities of Section 18 of the Exchange Act, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent we specifically incorporate it by reference into such a filing.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

108 edited+79 added−64 removed53 unchanged
Biggest changeYear Ended September 30, 2024 (in thousands) North America Solutions International Solutions Offshore Gulf of Mexico Segment operating income (loss) $ 610,674 $ (949) $ 12,415 Add back: Depreciation and amortization 366,446 10,863 7,530 Research and development 41,305 — — Selling, general and administrative expense 61,107 9,427 3,594 Direct margin (Non-GAAP) $ 1,079,532 $ 19,341 $ 23,539 Year Ended September 30, 2023 (in thousands) North America Solutions International Solutions Offshore Gulf of Mexico Segment operating income (loss) $ 625,467 $ (891) $ 22,806 Add back: Depreciation and amortization 353,976 7,615 7,622 Research and development 30,457 — — Selling, general and administrative expense 58,367 10,401 3,035 Asset impairment charges 3,948 8,149 — Direct margin (Non-GAAP) $ 1,072,215 $ 25,274 $ 33,463
Biggest change(in thousands) Year Ended September 30, 2025 Year Ended September 30, 2024 NORTH AMERICA SOLUTIONS Segment operating income $ 579,961 $ 610,623 Add back: Depreciation and amortization 351,813 366,446 Research and development 34,140 41,293 Selling, general and administrative expense 68,047 61,113 Acquisition transaction costs 41 — Asset impairment charges 1,507 — Restructuring charges 4,121 — Direct margin (Non-GAAP) $ 1,039,630 $ 1,079,475 INTERNATIONAL SOLUTIONS Segment operating income (loss) $ (291,695) $ 4,652 Add back: Depreciation and amortization 218,817 10,863 Selling, general and administrative expense 17,232 9,427 Acquisition transaction costs 1,585 — Asset impairment charges 132,720 — Restructuring charges 4,945 — Direct margin (Non-GAAP) $ 83,604 $ 24,942 OFFSHORE SOLUTIONS Segment operating income $ 49,942 $ 12,415 Add back: Depreciation and amortization 32,461 7,530 Selling, general and administrative expense 4,619 3,594 Acquisition transaction costs 2,971 — Restructuring charges 266 — Direct margin (Non-GAAP) $ 90,259 $ 23,539
The gains on our equity investments in ADNOC Drilling and Tamboran Corp. during the fiscal year ended September 30, 2024 were offset by $10.2 million and $1.4 million of losses on our investments in Galileo and a geothermal equity security, respectively, due to changes in the fair values of the investments, and a $7.1 million loss as a result of a Blue Chip Swap transaction.
The gains on our equity investments in ADNOC Drilling and Tamboran Corp. during the fiscal year ended September 30, 2024 were offset by a $10.2 million and $1.4 million of losses on our investments in Galileo and a geothermal equity security, respectively, due to changes in the fair values of the investments, and a $7.1 million loss as a result of a Blue Chip Swap transaction.
Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.
Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.
(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time.
(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time.
Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.
Management uses these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.
(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time.
(2) Direct margin, which is considered a non-GAAP metric, is defined as operating revenues less direct operating expenses and is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time.
Under the terms of the Amended Credit Facility, the Company may obtain unsecured revolving loans in an aggregate principal amount not to exceed $950 million outstanding at any time. $775 million of the revolving commitments under the Amended Credit Facility expire on November 12, 2028 and $175 million of the revolving commitments mature on November 10, 2027 (the “Stated Maturity Date”), but the Company may request two one-year extensions of the Stated Maturity Date, subject to satisfaction of certain conditions.
Under the terms of the Amended Credit Facility, the Company may obtain unsecured revolving loans in an aggregate principal amount not to exceed $950.0 million outstanding at any time. $775.0 million of the revolving commitments under the Amended Credit Facility expire on November 12, 2028 and $175.0 million of the revolving commitments mature on November 10, 2027 (the “Stated Maturity Date”), but the Company may request two one-year extensions of the Stated Maturity Date, subject to satisfaction of certain conditions.
We self‑insure a significant portion of expected losses relating to workers’ compensation, general liability, employer’s liability, auto liability, and certain other insurance coverages. Generally, deductibles range from $1 million to $10 million per occurrence depending on the coverage and whether a claim occurs outside or inside of the United States.
We self‑insure a significant portion of expected losses relating to workers’ compensation, general liability, employer’s liability, auto liability, and certain other insurance coverages. Generally, SIRs and deductibles range from $1 million to $10 million per occurrence depending on the coverage and whether a claim occurs outside or inside of the United States.
Insurance is purchased over deductibles to reduce our exposure to catastrophic events but there can be no assurance that such coverage will apply or be adequate in all circumstances. Estimates are recorded for incurred outstanding liabilities for workers’ compensation and other casualty claims.
Insurance is purchased over SIRs and deductibles to reduce our exposure to catastrophic events but there can be no assurance that such coverage will apply or be adequate in all circumstances. Estimates are recorded for incurred outstanding liabilities for workers’ compensation and other casualty claims.
Our wholly‑owned captive insurance companies finance a significant portion of the physical damage risk on company‑owned drilling rigs as well as casualty deductibles and other risk retentions. An actuary reviews the loss reserves retained by the Company and the Captives on an annual basis.
Our wholly‑owned captive insurance companies finance a significant portion of the physical damage risk on company‑owned drilling rigs as well as casualty SIRs, deductibles, and other risk retentions. An actuary reviews the loss reserves retained by the Company and the Captives on an annual basis.
During the fiscal year ended September 30, 2024, we repurchased 1.4 million common shares at an aggregate cost of $51.6 million, including accrued excise tax of $0.3 million, resulting in a net cash outflow of $51.3 million.
During the fiscal year ended September 30, 2024, we repurchased 1.4 million common shares at an aggregate cost of $51.6 million, including excise tax of $0.3 million, resulting in a net cash outflow of $51.3 million.
Senior Notes Issued in Fiscal Year 2021 On September 29, 2021, we issued $550.0 million aggregate principal amount of the 2.90 percent senior notes due 2031 (the "2031 Notes") in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act.
Senior Notes Issued in Fiscal Year 2021 On September 29, 2021, we issued $550.0 million aggregate principal amount of the 2.90 percent senior notes due 2031 (the "2031 Notes") in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act as amended (the "Securities Act") and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act.
Our activity during the fiscal year ended September 30, 2024, was driven by $9.1 million of investments in various debt and equity securities.
Our activity during the fiscal year ended September 30, 2024, was driven by $9.1 million in purchases of investments in various debt and equity securities.
Revolving Credit Facility On August 14, 2024, the Company entered into the Amended Credit Facility with the Revolving Credit Agreement Lenders, the issuing lenders party thereto and Wells Fargo, as administrative agent, swing line lender and issuing lender, which amended and restated the Credit Agreement, dated as of November 13, 2018 (as amended through Amendment No. 2 to the Credit Agreement dated as of March 8, 2022, the “Existing Credit Agreement”), among the Company, the lenders party thereto and Wells Fargo, as administrative agent, swing line lender and issuing lender.
Amended Credit Facility On August 14, 2024, the Company entered into an Amended and Restated Credit Agreement (the "Amended Credit Facility") with the lenders party thereto (the "Revolving Credit Agreement Lenders"), the issuing lenders party thereto and Wells Fargo ("Wells Fargo") as administrative agent, swingline lender and issuing lender, which amended and restated the Credit Agreement, dated as of November 13, 2018 (as amended through Amendment No. 2 to the Credit Agreement dated as of March 8, 2022, the “Existing Credit Agreement”), among the Company, the lenders party thereto and Wells Fargo, as administrative agent, swing line lender and issuing lender.
Commitment fees for both rates range from 0.075 percent to 0.200 percent per annum. Based on the unsecured debt rating of the Company on September 30, 2024, the spread over SOFR would have been 1.250 percent had borrowings been outstanding under the Amended Credit Facility and commitment fees would have been 0.150 percent.
Commitment fees for both rates range from 0.075 percent to 0.200 percent per annum. Based on the unsecured debt rating of the Company on September 30, 2025, the spread over SOFR would have been 1.250 percent had borrowings been outstanding under the Amended Credit Facility and commitment fees would have been 0.150 percent.
Results of Operations for the Fiscal Years Ended September 30, 2023 and 2022 A discussion of our results of operations for the fiscal year ended September 30, 2023 compared to the fiscal year ended September 30, 2022 is included in Part II, Item 7— "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023, filed with the SEC on November 8, 2023 .
Results of Operations for the Fiscal Years Ended September 30, 2024 and 2023 A discussion of our results of operations for the fiscal year ended September 30, 2024 compared to the fiscal year ended September 30, 2023 is included in Part II, Item 7— "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2024, filed with the SEC on November 8, 2024 .
Our activity during the fiscal year ended September 30, 2023, was driven by a $14.1 million equity investment in Tamboran Resources Corporation, $4.1 million in debt and equity security investments in various geothermal energy companies, and $2.5 million investments in other equity securities.
Our activity during the fiscal year ended September 30, 2023, was driven by purchases of a $14.1 million equity investment in Tamboran Resources Corporation, $4.1 million in debt and equity security investments in various geothermal energy companies, and $2.5 million investments in other equity securities.
We also carry insurance with varying deductibles and coverage limits with respect to stacked rigs, offshore platform rigs, and “named wind storm” risk in the Gulf of Mexico. We self‑insure a number of other risks, including loss of earnings and business interruption.
We also carry insurance with varying deductibles and coverage limits with respect to stacked rigs, offshore platform rigs, and “named wind storm” risk in the Gulf of America. We self‑insure a number of other risks, including loss of earnings and business interruption.
This gain consisted primarily of $30.9 million and $1.6 million gains on our equity investments in ADNOC Drilling and Tamboran Corp.; both of which were a result of increases in the fair market values of the stocks.
This gain consisted primarily of $30.9 million and $1.6 million gains on our equity investment in ADNOC Drilling and Tamboran Corp; both of which were a result of increases in the fair market values of the stocks.
Senior Notes Issued in Fiscal Year 2024 On September 17, 2024, we completed a private offering of $1.25 billion aggregate principal amount of the Notes, comprised of the following tranches: $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027 issued at a price equal to 99.958 percent of their face value, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029 issued at a price equal to 99.883 percent of their face value and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034 issued at a price equal to 99.670 percent of their face value.
Senior Notes Iss ued in Fiscal Year 2024 On September 17, 2024, we completed a private offering of $1.25 billion aggregate principal amount of senior notes, comprised of the following tranches (collectively, the “Notes”): $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027 issued at a price equal to 99.958 percent of their face value, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029 issued at a price equal to 99.883 percent of their face value and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034 issued at a price equal to 99.670 percent of their face value.
Liquidity and Capital Resources Sources of Liquidity Our sources of available liquidity include existing cash balances on hand, cash flows from operations, and availability under the Amended Credit Facility. Our liquidity requirements include meeting ongoing working capital needs, funding our capital expenditure projects, paying dividends declared, repaying our outstanding indebtedness, and funding the pending acquisition of KCA Deutag.
Liquidity and Capital Resources Sources of Liquidity Our sources of available liquidity include existing cash balances on hand, cash flows from operations, and availability under the Amended Credit Facility. Our liquidity requirements include meeting ongoing working capital needs, funding our capital expenditure projects, paying dividends declared, repaying our outstanding indebtedness, and funding the Acquisition.
Accordingly, past results and trends should not be used by investors to anticipate future results or trends. 2024 FORM 10-K | 44 Table of Contents Executive Summary H&P through its operating subsidiaries provides performance-driven drilling solutions and technologies that are intended to make hydrocarbon recovery safer and more economical for oil and gas exploration and production companies.
Accordingly, past results and trends should not be used by investors to anticipate future results or trends. 2025 FORM 10-K | 40 Table of Contents Executive Summary H&P through its operating subsidiaries provides performance-driven drilling solutions and technologies that are intended to make hydrocarbon recovery safer and more economical for oil and gas exploration and production companies.
During the fiscal year ended September 30, 2023, we repurchased 6.5 million common shares at an aggregate cost of $249.0 million, including excise tax of $1.8 million, resulting in a net cash outflow $247.2 million. During the fiscal year ended September 30, 2022, we repurchased 3.2 million common shares at an aggregate cost of $77.0 million.
During the fiscal year ended September 30, 2023, we repurchased 6.5 million common shares at an aggregate cost of $249.0 million, including excise tax of $1.8 million, resulting in a net cash outflow of $247.2 million.
As of September 30, 2024, there were no borrowings or letters of credit outstanding, leaving $950.0 million available to borrow under the Amended Credit Facility. As of September 30, 2024, we had $160.0 million in uncommitted bilateral credit facilities, for the purpose of obtaining the issuance of international letters of credit, bank guarantees, and performance bonds.
As of September 30, 2025, there were no borrowings or letters of credit outstanding, leaving $950.0 million available to borrow under the Amended Credit Facility. As of September 30, 2025, we had $400.0 million in uncommitted bilateral credit facilities, for the purpose of obtaining the issuance of international letters of credit, bank guarantees, and performance bonds.
The effective rates differ from the U.S. federal statutory rate (21.0 percent for the fiscal years 2024 and 2023) primarily due to non-deductible permanent items and state and foreign income taxes. Deferred income taxes are provided for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities.
The effective rates differ from the U.S. federal statutory rate (21.0 percent for the fiscal years 2025 and 2024) primarily due to non-deductible goodwill impairment, other non-deductible permanent items, and state and foreign income taxes. Deferred income taxes are provided for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities.
The benchmark rate is the SOFR. We can elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum.
The benchmark rate is the SOFR. We can elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus .001 per annum.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days we recognized revenue for during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days we recognized revenue for during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days we recognized revenue for during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
See — Non-GAAP Measurements below for a reconciliation of segment operating income (loss) to direct margin. (3) Defined as the number of contractual days for owned and leased rigs with recognized revenue during the period. (4) Active rigs generate revenue for the Company; accordingly, 'average active rigs' represents the average number of rigs generating revenue during the applicable time period.
Debt issuance costs paid in fiscal year 2024 were $22.9 million, of which $9.6 million relates to the senior notes issued in the current year and $13.3 million relates to other financing arrangements. For additional information regarding debt issuance and related costs, refer to Note 6—Debt to the Consolidated Financial Statements.
Debt issuance costs paid in fiscal year 2024 were $22.9 million, of which $9.6 million relates to the senior notes and $13.3 million relates to other financing arrangements. For additional information regarding debt agreements, refer to Note 7—Debt to the Consolidated Financial Statements.
The adjusted base rate is a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 0.50 percent, or (iii) the one-month adjusted SOFR rate plus 1.0 percent. We also pay a commitment fee on the unused balance of the facility.
The adjusted base rate is a fluctuating rate per annum equal to the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus .005, or (iii) the one-month adjusted SOFR rate plus .01. We also pay a commitment fee on the unused balance of the facility.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 366 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues Operating revenues were $106.2 million and $130.2 million in the fiscal year ended September 30, 2024 and 2023, respectively.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 365 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues Operating revenues were $520.4 million and $106.2 million in the fiscal year ended September 30, 2025 and 2024, respectively.
Direct Operating Expenses Direct operating expenses of $69.8 million and $57.9 million during the fiscal years ended September 30, 2024 and 2023, respectively, primarily consisted of $11.4 million and $12.5 million, respectively, in adjustments to accruals for estimated losses allocated to the Captives, rig and casualty insurance premiums of $37.6 million and $39.7 million, respectively, and medical stop loss expenses of $15.5 million and $10.6 million, respectively.
Direct Operating Expenses Direct operating expenses of $181.6 million and $69.8 million during the fiscal years ended September 30, 2025 and 2024, respectively, primarily consisted of $39.9 million and $11.4 million, respectively, in adjustments to accruals for estimated losses allocated to the Captives, rig and casualty insurance premiums of $42.7 million and $37.6 million, respectively, and medical stop loss expenses of $20.7 million and $15.5 million, respectively.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 366 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues Operating revenues were $194.0 million and $212.6 million in the fiscal years ended September 30, 2024 and 2023, respectively.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 365 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues Operating revenues were $802.4 million and $194.0 million in the fiscal years ended September 30, 2025 and 2024, respectively.
At the close of fiscal year 2024, we had 170 active contracted rigs, of which 100 were under a fixed-term contract and 70 were working well-to-well, compared to 164 contracted rigs at September 30, 2023. Our long-term strategy remains focused on innovation, technology, safety, operational excellence and reliability.
At the close of fiscal year 2025, we had 208 active contracted rigs, of which 131 were under a fixed-term contract and 77 were working well-to-well, compared to 170 contracted rigs at September 30, 2024. Our long-term strategy remains focused on innovation, technology, safety, operational excellence and reliability.
While costs incurred to relocate rigs and other drilling equipment to areas in which a contract has not been secured are expensed as incurred. We also act as a principal for certain reimbursable services and auxiliary equipment provided by us to our clients, for which we incur costs and earn revenues.
While costs incurred to relocate rigs and other drilling equipment to areas in which a contract has not been secured are expensed as incurred. 2025 FORM 10-K | 55 Table of Contents We also act as a principal for certain reimbursable services and auxiliary equipment provided by us to our clients, for which we incur costs and earn revenues.
The indenture governing the 2031 Notes also contains customary events of default with respect to the 2031 Notes. Term Loan Credit Agreement On August 14, 2024, the Company entered into the Term Loan Credit Agreement, dated as of August 14, 2024, among the Company, MSSF as administrative agent, and the other lenders party thereto.
The indenture governing the 2031 Notes also contains customary events of default with respect to the 2031 Notes. Term Loan Credit Agreement On August 14, 2024, the Company entered into the Term Loan Credit Agreement, among the Company, Morgan Stanley Senior Funding, Inc. (“MSSF”), as administrative agent, and the other lenders party thereto.
See Item 1A—Risk Factors—" Our current backlog of drilling services and solutions revenue may decline and may not be ultimately realized as fixed‑term contracts and may, in certain instances, be terminated without an early termination payment. ” within this Form 10-K regarding fixed term contract risk.
See Item 1A—Risk Factors—" Our current backlog of drilling services and solutions revenue may decline and may not be fully realized as fixed‑term contracts and, in certain instances, these contracts can be terminated without an early termination payment or suspended without standby or force majeure compensation. ” within this Form 10-K regarding fixed term contract risk.
Assets held-for-sale are reported at the lower of the carrying amount or fair value less estimated costs to sell. Our estimate of fair value represents our best estimate based on industry trends and reference to market transactions and is subject to variability.
Both the estimated useful lives and salvage values require the use of management estimates. Assets held-for-sale are reported at the lower of the carrying amount or fair value less estimated costs to sell. Our estimate of fair value represents our best estimate based on industry trends and reference to market transactions and is subject to variability.
See Note 6—Debt to our Consolidated Financial Statements. (2) See Note 4—Leases to our Consolidated Financial Statements. (3) See Note 16—Commitments and Contingencies to our Consolidated Financial Statements.
See Note 7—Debt to our Consolidated Financial Statements. (2) See Note 5—Leases to our Consolidated Financial Statements. (3) See Note 16—Commitments and Contingencies to our Consolidated Financial Statements.
Direct margin is not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures. 2024 FORM 10-K | 59 Table of Contents The following table reconciles direct margin to segment operating income, which we believe is the financial measure calculated and presented in accordance with GAAP that is most directly comparable to direct margin.
GAAP and should therefore be considered only as supplemental to such U.S. GAAP financial measures. 2025 FORM 10-K | 56 Table of Contents The following table reconciles direct margin to segment operating income, which we believe is the financial measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to direct margin.
Income Taxes We had an income tax expense of $136.9 million in fiscal year 2024 compared to an income tax expense of $159.3 million in fiscal year 2023. The effective income tax rate was 28.5 percent in fiscal year 2024 compared to 26.8 percent in fiscal year 2023.
Income Taxes We had an income tax expense of $85.8 million in fiscal year 2025 compared to an income tax expense of $136.9 million in fiscal year 2024. The effective income tax rate was (115.8) percent in fiscal year 2025 compared to 28.5 percent in fiscal year 2024.
Operating revenues of $71.6 million and $77.3 million during the fiscal years ended September 30, 2024 and 2023, respectively, primarily consisted of $61.2 million and $67.4 million, respectively, in intercompany premium revenues recorded by the Captives. These revenues were eliminated upon consolidation.
Operating revenues of $152.9 million and $71.6 million during the fiscal years ended September 30, 2025 and 2024, respectively, primarily consisted of $69.2 million and $61.2 million, respectively, in intercompany premium revenues recorded by the Captives. These revenues were eliminated upon consolidation.
Selling, General and Administrative Expense Selling, general and administrative expenses increased to $244.9 million in the fiscal year ended September 30, 2024 compared to $206.7 million in the fiscal year ended September 30, 2023.
Selling, General and Administrative Expense Selling, general and administrative expenses increased to $287.1 million in the fiscal year ended September 30, 2025 compared to $244.9 million in the fiscal year ended September 30, 2024.
Selling, General and Administrative Expenses Selling, general and administrative expenses increased to $61.1 million during the fiscal year ended September 30, 2024 as compared to $58.4 million during the fiscal year ended September 30, 2023.
Selling, General and Administrative Expenses Selling, general and administrative expenses increased to $68.0 million during the fiscal year ended September 30, 2025 as compared to $61.1 million during the fiscal year ended September 30, 2024.
If the carrying amount exceeds the fair value, an impairment charge will be recognized in an amount equal to the excess; however, the loss recognized would not exceed the total amount of goodwill allocated to that reporting unit. See Note 5—Goodwill and Intangible Assets for additional discussion of goodwill and intangible assets.
If the carrying amount exceeds the fair value, an impairment charge will be recognized in an amount equal to the excess; however, the loss recognized would not exceed the total amount of goodwill allocated to that reporting unit.
Self‑Insurance Accruals We insure working land rigs and related equipment at values that approximate the current replacement costs on the inception date of the policies. However, we self-insure large deductibles under these policies.
See Note 6—Goodwill and Intangible Assets for additional discussion of goodwill and intangible assets. Self‑Insurance Accruals We insure working land rigs and related equipment at values that approximate the current replacement costs on the inception date of the policies. However, we self-insure large deductibles under these policies.
Furthermore, E&Ps have become more fiscally disciplined in their level of capital expenditures relative to commodity price fluctuations, which has resulted in less volatility within the oilfield service businesses, including our operations.
Furthermore, E&Ps have become more fiscally disciplined in their level of capital expenditures relative to commodity price fluctuations and the amount of free cash flows that can be returned to their shareholders, which has resulted in less volatility within the oilfield service businesses, including our operations.
We define "Direct margin" as operating revenues less direct operating expenses. Direct margin is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time.
We define "Direct margin" as operating revenues less direct operating expenses. Direct margin is included as a supplemental disclosure because we believe it is useful in assessing and understanding our current operational performance, especially in making comparisons over time. Direct margin is not a substitute for financial measures prepared in accordance with U.S.
At September 30, 2024, we have recorded approximately $0.8 million of unrecognized tax benefits, interest, and penalties. We cannot predict with certainty if we will achieve ultimate resolution of any additional uncertain tax positions associated with our U.S. and international operations resulting in any additional material increases or decreases of our unrecognized tax benefits for the next twelve months.
We cannot predict with certainty if we will achieve ultimate resolution of any additional uncertain tax positions associated with our U.S. and international operations resulting in any additional material increases or decreases of our unrecognized tax benefits for the next twelve months.
Agency issued debt securities, highly rated corporate bonds and commercial paper, certificates of deposit and money market funds. However, in some international locations we may make short-term investments that are less conservative, as equivalent highly rated investments are unavailable. See—Note 2—Summary of Significant Accounting Policies, Related Risks and Uncertainties—International Solutions Drilling Risks.
Agency issued debt securities, highly rated corporate bonds and commercial paper, certificates of deposit and money market funds. However, in some international locations we may make short-term investments that are less conservative, as equivalent highly rated investments are unavailable.
Contract Backlog Drilling contract backlog is the expected future dayrate revenue from executed contracts. We calculate backlog as the total expected revenue from fixed-term contracts and do not include any anticipated contract renewals or expected performance bonuses as part of its calculation.
Accordingly, throughout this document and in future references, Kenera will be referred to as BENTEC™. Contract Backlog Drilling contract backlog is the expected future dayrate revenue from executed contracts. We calculate backlog as the total expected revenue from fixed-term contracts and do not include any anticipated contract renewals or expected performance bonuses as part of its calculation.
Depreciation and amortization includes amortization of intangible assets of $6.4 million and $6.6 million and abandonments of equipment of $6.5 million and $3.3 million in fiscal years 2024 and 2023, respectively. Research and Development Expense Research and development expense was $41.0 million and $30.0 million in fiscal years 2024 and 2023, respectively.
Depreciation and amortization includes amortization of intangible assets of $50.6 million and $6.4 million and abandonments of equipment of $2.9 million and $6.5 million in fiscal years 2025 and 2024, respectively. Research and Development Expense Research and development expense was $34.1 million and $41.0 million in fiscal years 2025 and 2024, respectively.
During the fiscal year ended 2024 and 2023, we entered into a Blue Chip Swap transaction, which resulted in a $7.1 million and $12.2 million loss on investment recorded in Gain on investment securities within our Consolidated Statements of Operations, respectively.
The execution of certain trades known as Blue Chip Swaps effectively results in a parallel U.S. dollar exchange rate. During the fiscal year ended 2024 and 2023, we entered into a Blue Chip Swap transaction, which resulted in a $7.1 million and $12.2 million loss on investment recorded in Gain on investment securities within our Consolidated Statements of Operations, respectively.
As a result of the Blue Chip Swap transactions, $13.8 million and $9.8 million of net cash was repatriated to the U.S. during 2024 and 2023, respectively. Net Purchases of Long-Term Investments Our net purchases of long-term investments were $9.1 million, $20.7 million and $29.2 million in fiscal years 2024, 2023 and 2022, respectively.
As a result of the Blue Chip Swap transactions, $13.8 million and $9.8 million of net cash was repatriated to the U.S. during 2024 and 2023, respectively. 2025 FORM 10-K | 49 Table of Contents Net Purchases and Sales of Long-Term Investments Our net sales of long-term investments during fiscal year 2025 were $28.7 million compared to net purchases of $9.1 million and $20.7 million in fiscal years 2025, 2024 and 2023, respectively.
Nonetheless, insurance estimates include certain assumptions and management judgments regarding the frequency and severity of claims, claim development and settlement practices. Unanticipated changes in these factors may produce materially different amounts of expense that would be reported under these programs.
We also engage a third-party actuary to perform a periodic review of our casualty losses. Nonetheless, insurance estimates include certain assumptions and management judgments regarding the frequency and severity of claims, claim development and settlement practices. Unanticipated changes in these factors may produce materially different amounts of expense that would be reported under these programs.
We can elect to borrow at either an adjusted SOFR rate or an adjusted base rate, plus an applicable margin. The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum.
The adjusted SOFR rate is the forward-looking term rate based on SOFR for the applicable tenor of one, three, or six months, plus 0.10 percent per annum.
The indenture governing the Notes contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company.
Substantially all of the Notes were tendered and exchanged for Registered Notes in the Exchange Offer. 2025 FORM 10-K | 50 Table of Contents The indenture governing the Notes contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to incur certain liens; engage in sale and lease-back transactions; and consolidate, merge or transfer all or substantially all of the assets of the Company.
The Company intends to use the net proceeds, together with the proceeds of its term loan credit facility (discussed below) and cash on hand, to finance the purchase price for the Acquisition, to repay certain of KCA Deutag’s outstanding indebtedness, and to pay related fees and expenses.
On January 16, 2025, H&P completed the Acquisition, and the Company used the net proceeds of the Notes, together with the proceeds of its term loan credit agreement (discussed below) and cash on hand, to finance the purchase price for the Acquisition, to repay or redeem certain of KCA Deutag’s outstanding indebtedness, and to pay related fees and expenses.
We expect to use the proceeds from the Term Loan Credit Agreement, together with the net proceeds from the sale of the Notes and cash on hand, to finance the purchase price for the Acquisition, to repay certain of KCA Deutag's outstanding indebtedness, and pay related fees and expenses.
On January 16, 2025, H&P completed the Acquisition, and the Company used the proceeds from the Term Loan Credit Agreement, together with the net proceeds from the Notes, and cash on hand, to finance the purchase price for the Acquisition, to repay or redeem certain of KCA Deutag's outstanding indebtedness, and to pay related fees and expenses.
If these estimates and related assumptions change in the future, additional valuation allowances may be recorded against the deferred tax assets resulting in additional income tax expense in the future. See Note 7—Income Taxes to our Consolidated Financial Statements for additional income tax disclosures.
If these estimates and related assumptions change in the future, additional valuation allowances may be recorded against the deferred tax assets resulting in additional income tax expense in the future.
We may seek to access the debt and equity capital markets from time to time to raise additional capital, increase liquidity as necessary, fund our additional purchases, exchange or redeem senior notes, or repay any amounts under the Amended Credit Facility.
See—Note 2—Summary of Significant Accounting Policies, Related Risks and Uncertainties. 2025 FORM 10-K | 48 Table of Contents We may seek to access the debt and equity capital markets from time to time to raise additional capital, increase liquidity as necessary, fund our additional purchases, exchange or redeem senior notes, or repay any amounts under the Amended Credit Facility.
Commitment fees for both rates range from 0.10 percent to 0.250 percent per annum. Based on the unsecured debt rating of the Company on September 30, 2024, the spread over SOFR would have been 1.375 percent had borrowings been outstanding under the Term Loan Credit Agreement and commitment fees would have been 0.175 percent.
Commitment fees for both rates range from 0.10 percent to 0.250 percent per annum. Based on the unsecured debt rating of the Company on September 30, 2025, the spread over SOFR was 1.375 percent and commitment fees were 0.175 percent. As of September 30, 2025, the interest rate on the Term loan was 5.610 percent per annum.
In connection with the issuance of the Notes, the Company also entered into a registration rights agreement, dated as of September 17, 2024 (the “Registration Rights Agreement”), with the initial purchasers of the Notes named therein.
For additional information regarding the completion of the Acquisition, refer to Note 3—Business Combination. In connection with the issuance of the Notes, the Company also entered into a registration rights agreement, dated as of September 17, 2024 (the "Registration Rights Agreement"), with the initial purchasers of the Notes named therein.
Depreciation and Amortization Depreciation and amortization expense was $397.3 million in fiscal year 2024 and $382.3 million in fiscal year 2023. The increase was primarily driven by $12.7 million of accelerated depreciation for components on rigs that were scheduled for conversion in fiscal year 2024 compared to $2.4 million for fiscal year 2023.
Depreciation and Amortization Depreciation and amortization expense decreased to $351.8 million during the fiscal year ended September 30, 2025 as compared to $366.4 million during the fiscal year ended September 30, 2024. The decrease was primarily driven by $12.7 million of accelerated depreciation in fiscal year 2024 for components on rigs that were scheduled for conversion.
As of September 30, 2024, we had a $495.5 million deferred tax liability on our Consolidated Balance Sheets, primarily related to temporary differences between the financial and income tax basis of property, plant and equipment.
This debt is allocated specifically to finance the ongoing rig construction activities in Oman. As of September 30, 2025, we had a $624.0 million deferred tax liability on our Consolidated Balance Sheets, primarily related to temporary differences between the financial and income tax basis of property, plant and equipment.
Future Cash Requirements Our operating cash requirements, scheduled debt repayments, interest payments, any declared dividends, and estimated capital expenditures for fiscal year 2025 are expected to be funded through current cash and cash to be provided from operating activities. However, there can be no assurance that we will continue to generate cash flows at current levels.
At September 30, 2025, we were in compliance with all debt covenants. Future Cash Requirements Our operating cash requirements, scheduled debt repayments, interest payments, any declared dividends, and estimated capital expenditures for fiscal year 2026 are expected to be funded through current cash and cash to be provided from operating activities.
Under the Term Loan Credit Agreement, the Company may obtain unsecured term loans in a single delayed draw in an aggregate principal amount up to $400.0 million. The Term Loan Credit Agreement matures at the two-year anniversary of the funding of the term loans unless earlier terminated pursuant to the terms of the Term Loan Credit Agreement.
On the Closing Date, the Company drew an aggregate principal amount of $400.0 million under the Term Loan Credit Agreement for purposes of financing the Acquisition. The Term Loan Credit Agreement matures at the two-year anniversary of the funding of the term loans unless earlier terminated pursuant to the terms of the Term Loan Credit Agreement.
The applicable agreements for all unsecured debt contain additional terms, conditions and restrictions that we believe are usual and customary in unsecured debt arrangements for companies that are similar in size and credit quality. At September 30, 2024, we were in compliance with all debt covenants.
The 2023 Oman Facility and related agreements contain additional terms, conditions, restrictions and covenants that we believe are usual and customary in secured debt arrangements for companies of similar size and credit quality.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 366 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues Operating revenues were $2.4 billion and $2.5 billion in fiscal year 2024 and 2023, respectively.
This metric is calculated by dividing revenue days by total days in the applicable period (i.e., 365 days). (5) Defined as the number of rigs generating revenue at the applicable end date of the time period. Operating Revenues During fiscal year ended September 30, 2025, operating revenue decrease by $83.6 million compared to the same period in 2024.
Retained losses under worker's compensation, general, automobile, and employer's liability policies are estimated and accrued based upon our estimates of the aggregate liability for claims incurred.
Retained losses under worker's compensation, general, automobile, and employer's liability policies are estimated and accrued based upon our estimates of the aggregate liability for claims incurred. These estimates are based on adjusters’ estimates, our historical loss experience and statistical methods commonly used within the insurance industry that we believe are reliable.
Offshore Gulf of Mexico The following table presents certain information with respect to our Offshore Gulf of Mexico reportable segment: (in thousands, except operating statistics) 2024 2023 % Change Operating revenues $ 106,207 $ 130,244 (18.5) % Direct operating expenses 82,668 96,781 (14.6) Depreciation 7,530 7,622 (1.2) Selling, general and administrative expense 3,594 3,035 18.4 Segment operating income $ 12,415 $ 22,806 (45.6) Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 23,539 $ 33,463 (29.7) Revenue days 3 1,111 1,460 (23.9) Average active rigs 4 3 4 (23.9) Number of active rigs at the end of period 5 3 4 (25.0) Number of available rigs at the end of period 7 7 — Reimbursements of "out-of-pocket" expenses $ 31,717 $ 30,445 4.2 (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
See Note 6—Goodwill and Intangible Assets for additional details related to the goodwill impairment charges. 2025 FORM 10-K | 46 Table of Contents Offshore Solutions The following table presents certain information with respect to our Offshore Solutions reportable segment: (in thousands, except operating statistics) 2025 2024 % Change Operating revenues $ 520,394 $ 106,207 390.0 % Direct operating expenses 430,135 82,668 420.3 Depreciation and amortization 32,461 7,530 331.1 Selling, general and administrative expense 4,619 3,594 28.5 Acquisition transaction costs 2,971 — — Restructuring charges 266 — — Segment operating income $ 49,942 $ 12,415 302.3 Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 90,259 $ 23,539 283.4 Revenue days 3 1,095 1,111 (1.4) Average active rigs 4 3 3 — Number of active rigs at the end of period 5 3 3 — Number of available rigs at the end of period 7 7 — Reimbursements of "out-of-pocket" expenses $ 86,662 $ 31,717 173.2 (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
Certain events, such as unforeseen changes in operations, technology or market conditions, could materially affect our estimates and assumptions related to depreciation or result in abandonments. For the fiscal years presented in this Form 10-K, no significant changes were made to the determinations of useful lives or salvage values.
Certain events, such as unforeseen changes in operations, technology or market conditions, could materially affect our estimates and assumptions related to depreciation or result in abandonments.
North America Solutions The following table presents certain information with respect to our North America Solutions reportable segment: (in thousands, except operating statistics) 2024 2023 % Change Operating revenues $ 2,445,946 $ 2,519,743 (2.9) % Direct operating expenses 1,366,414 1,447,528 (5.6) Depreciation and amortization 366,446 353,976 3.5 Research and development 41,305 30,457 35.6 Selling, general and administrative expense 61,107 58,367 4.7 Asset impairment charges — 3,948 (100.0) Segment operating income $ 610,674 $ 625,467 (2.4) Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 1,079,532 $ 1,072,215 0.7 Revenue days 3 55,387 61,814 (10.4) Average active rigs 4 151 169 (10.4) Number of active rigs at the end of period 5 151 147 2.7 Number of available rigs at the end of period 228 233 (2.1) Reimbursements of "out-of-pocket" expenses $ 294,375 $ 304,870 (3.4) (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
See Note 8—Income Taxes to our Consolidated Financial Statements for additional income tax disclosures. 2025 FORM 10-K | 44 Table of Contents North America Solutions The following table presents certain information with respect to our North America Solutions reportable segment: (in thousands, except operating statistics) 2025 2024 % Change Operating revenues $ 2,362,327 $ 2,445,946 (3.4) % Direct operating expenses 1,322,697 1,366,471 (3.2) Depreciation and amortization 351,813 366,446 (4.0) Research and development 34,140 41,293 (17.3) Selling, general and administrative expense 68,047 61,113 11.3 Acquisition transaction costs 41 — — Asset impairment charges 1,507 — — Restructuring charges 4,121 — — Segment operating income $ 579,961 $ 610,623 (5.0) Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 1,039,630 $ 1,079,475 (3.7) Revenue days 3 53,523 55,387 (3.4) Average active rigs 4 147 151 (2.6) Number of active rigs at the end of period 5 144 151 (4.6) Number of available rigs at the end of period 223 228 (2.2) Reimbursements of "out-of-pocket" expenses $ 290,591 $ 294,375 (1.3) (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
We account for the depreciation of property, plant and equipment using the straight‑line method over the estimated useful lives of the assets considering the estimated salvage value of the property, plant and equipment. Both the estimated useful lives and salvage values require the use of management estimates.
Property, Plant and Equipment Property, plant and equipment, including renewals and betterments, are capitalized at cost, while maintenance and repairs are expensed as incurred. We account for the depreciation of property, plant and equipment using the straight‑line method over the estimated useful lives of the assets considering the estimated salvage value of the property, plant and equipment.
If needed, we may decide to obtain additional funding from our $950.0 million Amended Credit Facility.
However, there can be no assurance that we will continue to generate cash flows at current levels. If needed, we may decide to obtain additional funding from our $950.0 million Amended Credit Facility.
International Solutions The following table presents certain information with respect to our International Solutions reportable segment: (in thousands, except operating statistics) 2024 2023 % Change Operating revenues $ 193,975 $ 212,566 (8.7) % Direct operating expenses 174,634 187,292 (6.8) Depreciation 10,863 7,615 42.7 Selling, general and administrative expense 9,427 10,401 (9.4) Asset impairment charges — 8,149 (100.0) Segment operating loss $ (949) $ (891) (6.5) Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 19,341 $ 25,274 (23.5) Revenue days 3 4,614 4,788 (3.6) Average active rigs 4 13 13 (3.6) Number of active rigs at the end of period 5 16 13 23.1 Number of available rigs at the end of period 27 22 22.7 Reimbursements of "out-of-pocket" expenses $ 8,482 $ 10,227 (17.1) (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
The increase was primarily driven by a $10.0 million increase in credit loss expense related to a long-term note receivable. 2025 FORM 10-K | 45 Table of Contents International Solutions The following table presents certain information with respect to our International Solutions reportable segment: (in thousands, except operating statistics) 2025 2024 % Change Operating revenues $ 802,426 $ 193,975 313.7 % Direct operating expenses 718,822 169,033 325.3 Depreciation and amortization 218,817 10,863 1,914.3 Selling, general and administrative expense 17,232 9,427 82.8 Acquisition transaction costs 1,585 — — Asset impairment charges 132,720 — — Restructuring charges 4,945 — — Segment operating income (loss) $ (291,695) $ 4,652 (6,370.3) Financial Data and Other Operating Statistics 1 : Direct margin (Non-GAAP) 2 $ 83,604 $ 24,942 235.2 Revenue days 3 19,985 4,614 333.1 Average active rigs 4 55 13 323.1 Number of active rigs at the end of period 5 61 16 281.3 Number of available rigs at the end of period 137 27 407.4 Reimbursements of "out-of-pocket" expenses $ 34,045 $ 8,482 301.4 (1) These operating metrics and financial data, including average active rigs, are provided to allow investors to analyze the various components of segment financial results in terms of activity, utilization and other key results.
The change in activity is driven by our ongoing liquidity management. Additionally, the Central Bank of Argentina maintains currency controls that limit our ability to access U.S. dollars in Argentina and remit cash from our Argentine operations. The execution of certain trades known as Blue Chip Swaps effectively results in a parallel U.S. dollar exchange rate.
The increase in activity is driven by $193.3 million of net proceeds received from the liquidation of shares in ADNOC Drilling and our ongoing liquidity management. The Central Bank of Argentina maintains currency controls that limit our ability to access U.S. dollars in Argentina and remit cash from our Argentine operations.
Total consideration is subject to adjustment as set forth in the Purchase Agreement. The transaction is expected to close prior to calendar 2024 year end, subject to customary closing conditions and regulatory approvals. Market Outlook Our revenues are primarily derived from the capital expenditures of companies involved in the exploration, development and production of crude oil and natural gas (“E&Ps”).
Market Outlook Our revenues are primarily derived from the capital expenditures of companies involved in the exploration, development and production of crude oil and natural gas (“E&Ps”).
The change in cash provided by operating activities between fiscal years 2024 and 2023 is primarily driven by lower activity levels partially offset by higher average pricing levels. The increase in cash provided by operating activities between fiscal years 2023 and 2022 was primarily driven by higher activity and pricing.
The decrease in cash provided by operating activities between fiscal years 2024 and 2023 was primarily driven by lower activity levels partially offset by higher average pricing levels. Net cash flows provided by (used) related to the change in working capital was $(79.8) million, $(38.4) million and $34.5 million as of September 30, 2025, 2024 and 2023, respectively.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA hypothetical 10 percent decrease in the market price for our marketable equity securities of Tamboran Corp and ADNOC Drilling as of September 30, 2024 would decrease the fair value by $22.7 million. These securities are subject to a wide variety and number of market‑related risks that could substantially reduce or increase the fair value of our holdings.
Biggest changeThese securities are subject to a wide variety and number of market‑related risks that could substantially reduce or increase the fair value of our holdings. 2025 FORM 10-K | 58 Table of Contents At November 10, 2025, the total fair value of our remaining equity securities in Tamboran Corp. decreased to approximately $25.4 million.
Any fluctuations in market conditions causing increased prices in materials and supplies could have a material adverse effect on future operating costs. Interest Rate Risk Our interest rate risk exposure results primarily from short‑term rates, mainly SOFR‑based, on any borrowings from the Amended credit facility.
Any fluctuations in market conditions causing increased prices in materials and supplies could have a material adverse effect on future operating costs. Interest Rate Risk Our interest rate risk exposure results primarily from short‑term rates, mainly SOFR‑based, on any borrowings from the Amended Credit Facility and Term Loan Credit Agreement.
The $1.8 billion (face amount) in senior unsecured notes at September 30, 2024 comprised of the following: $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029, $550.0 million aggregate principal amount of 2.90 percent senior notes due 2031 and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034.
The $1.8 billion (face amount) in senior unsecured notes at September 30, 2025 comprised of the following: $350.0 million aggregate principal amount of 4.65 percent senior notes due 2027, $350.0 million aggregate principal amount of 4.85 percent senior notes due 2029, $550.0 million aggregate principal amount of 2.90 percent senior notes due 2031 and $550.0 million aggregate principal amount of 5.50 percent senior notes due 2034.
We continually monitor the fair value of the investments but are unable to predict future market volatility and any potential impact to the Consolidated Financial Statements. 2024 FORM 10-K | 61 Table of Contents
We continually monitor the fair value of the investments but are unable to predict future market volatility and any potential impact to the Consolidated Financial Statements. 2025 FORM 10-K | 59 Table of Contents
As a result, demand for drilling services and solutions is not always purely a function of the movement of commodity prices. 2024 FORM 10-K | 60 Table of Contents Credit and Capital Market Risk Customers may finance their exploration activities through cash flow from operations, the incurrence of debt, or the issuance of equity.
As a result, demand for drilling services and solutions is not always purely a function of the movement of commodity prices. Credit and Capital Market Risk Customers may finance their exploration activities through cash flow from operations, the incurrence of debt, or the issuance of equity.
Equity Price Risk As of September 30, 2024 and 2023, we had equity securities in Tamboran Corp. with a total fair value of $21.0 million and $9.9 million, respectively. On June 4, 2024, the Company entered into a convertible note agreement with Tamboran Corp.
As of September 30, 2025 and 2024, we had equity securities in Tamboran Corp. with a total fair value of $26.0 million and $21.0 million, respectively. On June 4, 2024, the Company entered into a convertible note agreement with Tamboran Corp.
On June 26, 2024,Tamboran Corp. completed an initial public offering of its common stock on the NYSE and as a result of this offering, our convertible note of $9.4 million was converted into 0.5 million common shares in Tamboran Corp. Our shares received in this initial public offering are subject to a 180-day lockup period.
On June 26, 2024, Tamboran Corp. completed an initial public offering of its common stock on the NYSE and as a result of this offering, our convertible note of $9.4 million was converted into 0.5 million common shares in Tamboran Corp.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our financial position is exposed to a variety of risks, including foreign currency exchange rate risk, commodity price risk, credit and capital market risk, interest rate risk and equity price risk. Foreign Currency Exchange Rate Risk Our drilling contracts in foreign countries generally provide for payment in U.S. dollars.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our financial position is exposed to a variety of risks, including foreign currency exchange rate risk, commodity price risk, credit and capital market risk, interest rate risk and equity price risk.
There were no outstanding borrowings under this facility at September 30, 2024 and our outstanding debt consisted of $1.8 billion (face amount) in senior unsecured notes, and an estimated fair value of $1.7 billion as of September 30, 2024.
Our outstanding debt consisted of $2.1 billion (face amount) in senior unsecured notes, an unsecured term loan credit agreement and secured term loan credit agreements, and had an estimated fair value of $1.9 billion as of September 30, 2025.
Commodity Price Risk The demand for drilling services and solutions is derived from exploration and production companies spending money to explore and develop drilling prospects in search of crude oil and natural gas.
At September 30, 2025, a uniform 10% decline in the U.S. dollar relative to each of the currencies in which the Company has foreign currency exposure would result in an increase in pre-tax loss of approximately $5.6 million. 2025 FORM 10-K | 57 Table of Contents Commodity Price Risk The demand for drilling services and solutions is derived from exploration and production companies spending money to explore and develop drilling prospects in search of crude oil and natural gas.
At September 30, 2024, a hypothetical decrease in value of 10 percent would result in a decrease in value of our monetary assets and liabilities denominated in Argentine pesos by approximately $0.6 million.
A hypothetical 10 percent decrease in the market price for our marketable equity securities of Tamboran Corp as of September 30, 2025 would decrease the fair value by $2.6 million.
Removed
Historically, in Argentina, while the contracts were denominated in the U.S. dollar, we were paid in Argentine pesos. The Argentine branch of one of our second-tier subsidiaries remits U.S. dollars to its U.S. parent by converting the Argentine pesos into U.S. dollars through the Argentine Foreign Exchange Market and repatriating the U.S. dollars.
Added
Foreign Currency Exchange Rate Risk The Company has a number of subsidiaries that generate revenue and incur expenses in numerous foreign currencies. Changes in foreign currency exchange rates impact the Company's results of operations through changes in the dollar value of foreign currency-denominated operating revenues and expenses.
Removed
In the future, other contracts or applicable law may require payments to be made in foreign currencies.
Added
Some of the Company's more significant foreign currency exposures include the British Pound Sterling, Euro, Norwegian Krone, Canadian Dollar, Angolan Kwanza, Pakistani Rupee, Colombian Peso and Argentine Peso. We have not entered into any foreign currency forward exchange contracts or other derivative financial instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates.
Removed
As such, there can be no assurance that we will not experience in Argentina or elsewhere a devaluation of foreign currency, foreign exchange restrictions or other difficulties repatriating U.S. dollars even if we are able to negotiate the contract provisions designed to mitigate such risks.
Added
At September 30, 2025, there were no outstanding borrowings under the Amended Credit Facility and $200.0 million outstanding under the Term Loan Credit Agreement.
Removed
Argentina’s economy is currently considered highly inflationary, which is defined as cumulative inflation rates exceeding 100 percent in the most recent three‑year period based on inflation data published by the respective governments.
Added
The unsecured term loan credit agreement as September 30, 2025 consisted of $200 million due 2027. The secured term loan credit agreements at September 30, 2025 comprised of the following: $39.8 million secured term loan due 2033 and $43.1 million secured term loan due 2034.
Removed
Nonetheless, all of our foreign operations use the U.S. dollar as the functional currency and local currency monetary assets and liabilities are remeasured into U.S. dollars with gains and losses resulting from foreign currency transactions included in current results of operations.
Added
Equity Price Risk In October 2022, we made a $14.1 million equity investment, representing 106.0 million common shares in Tamboran Resources. In December 2023, all shares of Tamboran Resources were transferred to Tamboran Corp. in exchange for depository interests in Tamboran Corp.
Removed
Consistent with the provisions of ASU No. 2022-03, contractual sale restrictions are not considered in the fair value measurement of our investment in Tamboran Resources Corporation. As of September 30, 2024 and 2023 we had equity securities in ADNOC Drilling with a total fair value of $205.6 million and $174.8 million, respectively.
Added
Depository interests, referred to as CHESS Depository Interests, each representing beneficial interests of 1/200th of a share of Tamboran Corp. common stock, are listed on the Australian Stock Exchange under the ticker symbol "TBN." Tamboran Corp. is focused on developing a natural gas resource in Australia's Beetaloo Sub-basin.
Removed
Our investment in ADNOC Drilling was subject to a three-year lockup period, which expired during September 2024.
Removed
We have applied the guidance in Topic 820, Fair Value Measurement, in the initial accounting of the transaction and the subsequent revaluation of the investment balance, concluding that the contractual restriction on the sale of an equity security that is publicly traded is not considered in measuring fair value.
Removed
Subsequent to the 2024 fiscal year end, we sold our shares of ADNOC Drilling for aggregate proceeds of approximately $197.3 million. Refer to Note 18—Subsequent Events. At November 6, 2024, the total fair value of our remaining equity securities in Tamboran Corp. decreased to approximately $19.1 million.

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