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SEC Filings

8-K
KEY ENERGY SERVICES INC filed this Form 8-K on 11/09/2017
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November 8, 2017

 
 
 


Services margins were impacted by a charge of $4.0 million due to a legal settlement and an approximately 200 basis points quarter on quarter reduction in margin due to make ready costs and labor inefficiency associated with increasing activity. 
Third quarter 2017 Coiled Tubing Services revenues of $12.5 million were up 36.4% as compared to second quarter 2017 revenues of $9.2 million. Activity in our largest, completions-driven coiled tubing units increased approximately 30% and pricing on these units was up approximately 4% from the second quarter of 2017 to the third quarter of 2017. Coiled Tubing Services margins benefited by approximately 700 basis points in the third quarter from the second quarter on the higher activity and pricing. The Company expects to have all of its 2 3/8 inch or larger diameter coiled tubing units deployed and active over the next several months.
Third quarter 2017 Fishing & Rental Services margins improved by approximately 500 basis points due to higher activity and the impact of selling the Company’s frac stack and well testing business in the second quarter of 2017. These assets contributed $2 million in revenue during the second quarter of 2017, and the sale of these assets resulted in the approximately 10% decline in revenues from $15.8 million in the second quarter of 2017 to $14.2 million in the third quarter of 2017.  Excluding the frac stack and well testing revenues from the second quarter, revenue increased 2.9% in the third quarter.
International Segment
The company completed its exit of international operations in the third quarter with the sale of its Russian operations. Third quarter 2017 International revenues were $1.3 million, down 38.7% as compared to second quarter 2017 revenues of $2.2 million as a result of the sale. The company recorded a gain on this sale of $4.7 million which is reflected in Other Income. Third quarter operating loss was $1.1 million, or -84.7% of revenues. These results compare to second quarter 2017 operating loss of $1.3 million, or -62.3% of revenues, which included a $0.3 million loss on sale of assets; excluding this item, normalized operating income was $1.0 million, or -46.7% of revenue.
General and Administrative Expenses    
General and Administrative (G&A) expenses were $37.2 million for the third quarter 2017. Third quarter G&A expenses included $11.6 million of legal fees and settlements, $3.3 million of stock-based compensation expense and $0.2 million in severance. This compares to second quarter 2017 G&A expenses of $30.3 million which included $3.7 million of stock-based compensation expense

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