SEGMENT INFORMATION

We revised our reportable business segments as of the fourth quarter of 2014. The revised reportable segments are U.S. Rig Services, Fluid Management Services, Coiled Tubing Services, Fishing and Rental Services and International. We also have a “Functional Support” segment associated with overhead and other costs in support of our reportable segments. Segment disclosures as of and for the the three and nine months ended September 30, 2014 have been revised to reflect the change in reportable segments. We revised our segments to reflect changes in management’s resource allocation and performance assessment in making decisions regarding our business. Our U.S. Rig Services, Fluid Management Services, Coiled Tubing Services, Fishing and Rental Services operate geographically within the United States. The International reportable segment includes our operations in Mexico, Colombia, Ecuador, Russia, Bahrain and Oman. Our Canadian subsidiary is also reflected in our International reportable segment. We evaluate the performance of our segments based on gross margin measures. All inter-segment sales pricing is based on current market conditions.

U.S. Rig Services

Our U.S. Rig Services include the completion of newly drilled wells, workover and recompletion of existing oil and natural gas wells, well maintenance, and the plugging and abandonment of wells at the end of their useful lives. We also provide specialty drilling services to oil and natural gas producers with certain of our larger rigs that are capable of providing conventional and horizontal drilling services. Our rigs encompass various sizes and capabilities, allowing us to service all types of wells with depths up to 20,000 feet. Many of our rigs are outfitted with our proprietary KeyView® technology, which captures and reports well site operating data and provides safety control systems. We believe that this technology allows our customers and our crews to better monitor well site operations, improves efficiency and safety, and adds value to the services that we offer.

The completion and recompletion services provided by our rigs prepare wells for production, whether newly drilled, or recently extended through a workover operation. The completion process may involve selectively perforating the well casing to access production zones, stimulating and testing these zones, and installing tubular and downhole equipment. We typically provide a well service rig and may also provide other equipment to assist in the completion process. Completion services vary by well and our work may take a few days to several weeks to perform, depending on the nature of the completion.

The workover services that we provide are designed to enhance the production of existing wells and generally are more complex and time consuming than normal maintenance services. Workover services can include deepening or extending wellbores into new formations by drilling horizontal or lateral wellbores, sealing off depleted production zones and accessing previously bypassed production zones, converting former production wells into injection wells for enhanced recovery operations and conducting major subsurface repairs due to equipment failures. Workover services may last from a few days to several weeks, depending on the complexity of the workover.

Maintenance services provided with our rig fleet are generally required throughout the life cycle of an oil or natural gas well. Examples of these maintenance services include routine mechanical repairs to the pumps, tubing and other equipment, removing debris and formation material from wellbores, and pulling rods and other downhole equipment from wellbores to identify and resolve production problems. Maintenance services are generally less complicated than completion and workover related services and require less time to perform.

Our rig fleet is also used in the process of permanently shutting-in oil or natural gas wells that are at the end of their productive lives. These plugging and abandonment services generally require auxiliary equipment in addition to a well servicing rig. The demand for plugging and abandonment services is not significantly impacted by the demand for oil and natural gas because well operators are required by state regulations to plug wells that are no longer productive.

Fluid Management Services

We provide transportation and well-site storage services for various fluids utilized in connection with drilling, completions, workover and maintenance activities. We also provide disposal services for fluids produced subsequent to well completion. These fluids are removed from the well site and transported for disposal in saltwater disposal wells owned by us or a third party. In addition, we operate a fleet of hot oilers capable of pumping heated fluids used to clear soluble restrictions in a wellbore. Demand and pricing for these services generally correspond to demand for our well service rigs.

Coiled Tubing Services

Coiled Tubing Services involve the use of a continuous metal pipe spooled onto a large reel which is then deployed into oil and natural gas wells to perform various applications, such as wellbore clean-outs, nitrogen jet lifts, through-tubing fishing, and formation stimulations utilizing acid and chemical treatments. Coiled tubing is also used for a number of horizontal well applications such as milling temporary isolation plugs that separate frac zones, and various other pre- and post-hydraulic fracturing well preparation services.

Fishing and Rental Services

We offer a full line of fishing services and rental equipment designed for use in providing both onshore and offshore drilling and workover services. Fishing services involve recovering lost or stuck equipment in the wellbore utilizing a broad array of “fishing tools.” Our rental tool inventory consists of drill pipe, tubulars, handling tools (including our patented Hydra-Walk^® pipe-handling units and services), pressure-control equipment, pumps, power swivels, reversing units, foam air units, frac stack equipment used to support hydraulic fracturing operations and the associated flowback of frac fluids, proppants, oil and natural gas. We also provide well testing services.

Demand for our fishing and rental services is closely related to capital spending by oil and natural gas producers, which is generally a function of oil and natural gas prices.

International

Our International segment includes operations in Mexico, Colombia, Ecuador, the Middle East and Russia. We provide rig-based services such as the maintenance, workover, recompletion of existing oil wells, completion of newly-drilled wells and plugging and abandonment of wells at the end of their useful lives in each of our international markets. In addition, we have a technology development and control systems business based in Canada.

In addition, in Mexico we provide drilling, coiled tubing, wireline and project management and consulting services. Our work in Mexico also requires us to provide third-party services, which vary in scope by project.

Our technology development and control systems business based in Canada is focused on the development of hardware and software related to oilfield service equipment controls, data acquisition and digital information flow.

In April 2015, we announced our decision to exit markets in which we participate outside of North America. Our strategy is to sell or relocate the assets of the businesses operating in these markets. We are in negotiations to sell our subsidiary in Bahrain and certain assets in Oman. We expect these sales to occur before the end of 2015. In the third quarter, we transferred four rigs from Ecuador to the U.S. and sold the remaining operating assets of our Ecuadorian business unit at auction. Additionally, in Colombia, we relocated one rig to the U.S. in the third quarter and plan to sell or relocate thirteen rigs to the U.S. in the fourth quarter. We plan to sell the remaining property and equipment, net, and inventories of our Colombian business unit in the fourth quarter of 2015.

Functional Support

Our Functional Support segment includes unallocated overhead costs associated with administrative support for our U.S. and International reporting segments.

Financial Summary

The following tables set forth our unaudited segment information as of and for the three and nine months ended September 30, 2015 and 2014 (in thousands):



As of and for the three months ended September 30, 2015
	U.S. Rig Services			Fluid Management Services			Coiled Tubing Services			Fishing and Rental Services			International			Functional Support(2)			Reconciling Eliminations			Total
Revenues from external customers	$	85,200		$	35,519		$	20,820		$	27,629		$	7,689		$	—		$	—		$	176,857
Intersegment revenues	84			417			2			1,552			763			542			(3,360		)	—
Depreciation and amortization	14,876			6,618			5,671			8,561			6,236			3,308			—			45,270
Impairment expense	297,719			24,479			105,995			180,974			40,777			—			—			649,944
Other operating expenses	77,939			32,758			25,726			24,172			32,844			26,380			—			219,819
Operating loss	(305,334		)	(28,336		)	(116,572		)	(186,078		)	(72,168		)	(29,688		)	—			(738,176		)
Interest expense, net of amounts capitalized	—			—			—			—			16			21,688			—			21,704
Loss before income taxes	(305,373		)	(28,321		)	(116,570		)	(185,784		)	(74,408		)	(55,339		)	—			(765,795		)
Long-lived assets(1)	495,278			152,610			60,871			141,349			150,897			198,340			(145,984		)	1,053,361
Total assets	1,333,275			279,377			143,892			474,416			250,438			(579,969		)	(407,405		)	1,494,024
Capital expenditures	779			2,200			434			2,586			4			229			—			6,232



As of and for the three months ended September 30, 2014
	U.S. Rig Services		Fluid Management Services			Coiled Tubing Services		Fishing and Rental Services			International			Functional Support(2)			Reconciling Eliminations			Total
Revenues from external customers	$	178,219	$	63,818		$	42,309	$	55,502		$	25,950		$	—		$	—		$	365,798
Intersegment revenues	278		368			—		(1,045		)	2,343			361			(2,305		)	—
Depreciation and amortization	15,375		8,101			5,850		11,031			7,689			2,878			—			50,924
Impairment expense	—		—			—		60,792			—			—			—			60,792
Other operating expenses	134,707		55,859			36,443		39,094			27,517			43,716			—			337,336
Operating income (loss)	28,137		(142		)	16		(55,415		)	(9,256		)	(46,594		)	—			(83,254		)
Interest expense, net of amounts capitalized	—		—			—		—			1			13,416			—			13,417
Income (loss) before income taxes	28,214		(104		)	240		(55,397		)	(10,274		)	(59,698		)	—			(97,019		)
Long-lived assets(1)	782,392		201,985			217,122		347,144			260,706			274,946			(160,014		)	1,924,281
Total assets	1,593,832		288,597			254,701		657,890			415,678			(430,217		)	(373,835		)	2,406,646
Capital expenditures	22,884		583			3,071		9,618			831			1,704			—			38,691



As of and for the nine months ended September 30, 2015
	U.S. Rig Services			Fluid Management Services			Coiled Tubing Services			Fishing and Rental Services			International			Functional Support(2)			Reconciling Eliminations			Total
Revenues from external customers	$	299,275		$	125,452		$	73,446		$	98,461		$	45,518		$	—		$	—		$	642,152
Intersegment revenues	543			1,146			2			4,801			2,928			1,626			(11,046		)	—
Depreciation and amortization	44,561			20,865			17,279			26,507			19,572			9,593			—			138,377
Impairment expense	297,719			24,479			127,695			180,974			62,129			—			—			692,996
Other operating expenses	258,461			107,027			72,949			83,688			74,467			104,952			—			701,544
Operating loss	(301,466		)	(26,919		)	(144,477		)	(192,708		)	(110,650		)	(114,545		)	—			(890,765		)
Interest expense, net of amounts capitalized	—			—			—			—			16			52,088			—			52,104
Loss before income taxes	(301,408		)	(26,838		)	(144,464		)	(192,584		)	(113,958		)	(173,716		)	—			(952,968		)
Long-lived assets(1)	495,278			152,610			60,871			141,349			150,897			198,340			(145,984		)	1,053,361
Total assets	1,333,275			279,377			143,892			474,416			250,438			(579,969		)	(407,405		)	1,494,024
Capital expenditures	13,641			6,000			4,555			8,205			2,879			3,627			—			38,907



As of and for the nine months ended September 30, 2014
	U.S. Rig Services		Fluid Management Services		Coiled Tubing Services			Fishing and Rental Services			International			Functional Support(2)			Reconciling Eliminations			Total
Revenues from external customers	$	512,950	$	187,493	$	129,912		$	158,052		$	84,127		$	—		$	—		$	1,072,534
Intersegment revenues	568		512		—			(1,045		)	7,111			1,446			(8,592		)	—
Depreciation and amortization	44,166		24,534		17,655			35,646			23,388			8,814			—			154,203
Impairment expense	—		—		—			60,792			28,687			—			—			89,479
Other operating expenses	393,344		159,796		106,685			113,396			88,645			107,402			—			969,268
Operating income (loss)	75,440		3,163		5,572			(51,782		)	(56,593		)	(116,216		)	—			(140,416		)
Interest expense, net of amounts capitalized	—		—		(1		)	—			29			40,369			—			40,397
Income (loss) before income taxes	76,458		3,594		6,083			(51,468		)	(57,511		)	(155,515		)	—			(178,359		)
Long-lived assets(1)	782,392		201,985		217,122			347,144			260,706			274,946			(160,014		)	1,924,281
Total assets	1,593,832		288,597		254,701			657,890			415,678			(430,217		)	(373,835		)	2,406,646
Capital expenditures	66,780		2,341		6,568			20,773			4,501			7,157			—			108,120


(1)	Long-lived assets include fixed assets, goodwill, intangibles and other non-current assets.


(2)	Functional Support is geographically located in the United States.