NOTE 15 GUARANTOR AND NON-GUARANTOR FINANCIAL INFORMATION

In March 2015, Helmerich & Payne International Drilling Co. ("the issuer"), a 100 percent owned subsidiary of Helmerich & Payne, Inc. ("parent", "the guarantor"), issued senior unsecured notes with an aggregate principal amount of $500.0 million. The notes are fully and unconditionally guaranteed by the parent. No subsidiaries of the parent currently guarantee the notes, subject to certain provisions that if any subsidiary guarantees certain other debt of the issuer or parent, then such subsidiary will provide a guarantee of the obligation under the notes.

In connection with the notes, we are providing the following condensed consolidating financial information in accordance with the Securities and Exchange Commission disclosure requirements. Each entity in the consolidating financial information follows the same accounting policies as described in the consolidated financial statements. Condensed consolidating financial information for the issuer, Helmerich & Payne International Drilling Co. and parent, guarantor, Helmerich & Payne, Inc. is shown in the tables below.

CONDENSED CONSOLIDATING STATEMENTS OF INCOME
(in thousands)

	Year Ended September 30, 2015
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating revenue	$	—		$	2,735,864		$	429,652		$	(75	)	$	3,165,441
Operating costs and other		10,875			2,037,464			444,456			(3,104	)		2,489,691

Operating income (loss) from continuing operations		(10,875	)		698,400			(14,804	)		3,029			675,750
Other income, net		(91	)		7,522			531			(3,029	)		4,933
Interest expense		(159	)		(8,955	)		(5,922	)		—			(15,036	)
Equity in net income (loss) of subsidiaries		429,140			(11,207	)		—			(417,933	)		—

Income (loss) from continuing operations before income taxes		418,015			685,760			(20,195	)		(417,933	)		665,647
Income tax provision		(4,210	)		258,660			(11,075	)		—			243,375

Income (loss) from continuing operations		422,225			427,100			(9,120	)		(417,933	)		422,272
Loss from discontinued operations before income taxes		—			—			(124	)		—			(124	)
Income tax provision		—			—			(77	)		—			(77	)

Loss from discontinued operations		—			—			(47	)		—			(47	)

Net income (loss)	$	422,225		$	427,100		$	(9,167	)	$	(417,933	)	$	422,225

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)

	Year Ended September 30, 2015
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Net income (loss)	$	422,225		$	427,100		$	(9,167	)	$	(417,933	)	$	422,225
Other comprehensive loss, net of income taxes:
Unrealized depreciation on securities, net		—			(80,217	)		—			—			(80,217	)
Minimum pension liability adjustments, net		(666	)		(3,620	)		—			—			(4,286	)

Other comprehensive loss		(666	)		(83,837	)		—			—			(84,503	)

Comprehensive income	$	421,559		$	343,263		$	(9,167	)	$	(417,933	)	$	337,722

CONDENSED CONSOLIDATING STATEMENTS OF INCOME
(in thousands)

	Year Ended September 30, 2014
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating revenue	$	—		$	3,325,039		$	394,820		$	(152	)	$	3,719,707
Operating costs and other		10,763			2,291,775			366,682			(4,300	)		2,664,920

Operating income (loss) from continuing operations		(10,763	)		1,033,264			28,138			4,148			1,054,787
Other income, net		57			48,108			2,164			(4,148	)		46,181
Interest expense		(42	)		(3,049	)		(1,563	)		—			(4,654	)
Equity in net income of subsidiaries		715,157			4,668			—			(719,825	)		—

Income from continuing operations before income taxes		704,409			1,082,991			28,739			(719,825	)		1,096,314
Income tax provision		(4,310	)		370,723			21,135			—			387,548

Income from continuing operations		708,719			712,268			7,604			(719,825	)		708,766
Income from discontinued operations before income taxes		—			—			2,758			—			2,758
Income tax provision		—			—			2,805			—			2,805

Loss from discontinued operations		—			—			(47	)		—			(47	)

Net income	$	708,719		$	712,268		$	7,557		$	(719,825	)	$	708,719

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)

	Year Ended September 30, 2014
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
Net income	$	708,719		$	712,268		$	7,557	$	(719,825	)	$	708,719
Other comprehensive loss, net of income taxes:
Unrealized depreciation on securities, net		—			(19,006	)		—		—			(19,006	)
Reclassification of realized gains in net income, net		—			(27,737	)		—		—			(27,737	)
Minimum pension liability adjustments, net		(213	)		(2,448	)		—		—			(2,661	)

Other comprehensive loss		(213	)		(49,191	)		—		—			(49,404	)

Comprehensive income	$	708,506		$	663,077		$	7,557	$	(719,825	)	$	659,315

CONDENSED CONSOLIDATING STATEMENTS OF INCOME
(in thousands)

	Year Ended September 30, 2013
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating revenue	$	—		$	2,998,299		$	389,382		$	(67	)	$	3,387,614
Operating costs and other		12,775			2,063,737			355,751			(1,310	)		2,430,953

Operating income (loss) from continuing operations		(12,775	)		934,562			33,631			1,243			956,661
Other income, net		20			164,170			863			(1,288	)		163,765
Interest expense		(83	)		(4,776	)		(1,315	)		45			(6,129	)
Equity in net income of subsidiaries		745,105			33,360			—			(778,465	)		—

Income from continuing operations before income taxes		732,267			1,127,316			33,179			(778,465	)		1,114,297
Income tax provision		(4,372	)		383,881			13,335			—			392,844

Income from continuing operations		736,639			743,435			19,844			(778,465	)		721,453
Income from discontinued operations before income taxes		—			—			14,701			—			14,701
Income tax provision		—			—			(485	)		—			(485	)

Loss from discontinued operations		—			—			15,186			—			15,186

Net income	$	736,639		$	743,435		$	35,030		$	(778,465	)	$	736,639

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)

	Year Ended September 30, 2013
	Guarantor/ Parent		Issuer Subsidiary			Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
Net income	$	736,639	$	743,435		$	35,030	$	(778,465	)	$	736,639
Other comprehensive income (loss), net of income taxes:
Unrealized appreciation on securities, net		—		46,853			—		—			46,853
Reclassification of realized gains in net income, net		—		(92,543	)		—		—			(92,543	)
Minimum pension liability adjustments, net		2,663		8,750			—		—			11,413

Other comprehensive income (loss)		2,663		(36,940	)		—		—			(34,277	)

Comprehensive income	$	739,302	$	706,495		$	35,030	$	(778,465	)	$	702,362

CONDENSED CONSOLIDATING BALANCE SHEETS
(in thousands)

	September 30, 2015
	Guarantor/ Parent			Issuer Subsidiary		Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	(838	)	$	693,273	$	34,096	$	(8,554	)	$	717,977
Short-term investments		—			45,543		—		—			45,543
Accounts receivable, net of reserve		152			374,383		80,484		(5,675	)		449,344
Inventories		—			88,010		40,719		—			128,729
Deferred income taxes		2,834			19,154		—		(4,788	)		17,200
Prepaid expenses and other		20,018			6,713		48,100		(2,714	)		72,117
Current assets of discontinued operations		—			—		8,097		—			8,097

Total current assets		22,166			1,227,076		211,496		(21,731	)		1,439,007
Investments		12,871			91,483		—		—			104,354
Property, plant and equipment, net		55,902			5,063,705		447,628		—			5,567,235
Intercompany		15,875			1,192,634		229,626		(1,438,135	)		—
Other assets		8,387			1,389		39,793		(8,153	)		41,416
Investment in subsidiaries		5,625,360			227,910		—		(5,853,270	)		—

Total assets	$	5,740,561		$	7,804,197	$	928,543	$	(7,321,289	)	$	7,152,012


LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	80,673		$	20,404	$	9,632	$	(5	)	$	110,704
Accrued liabilities		10,688			151,607		46,542		(10,784	)		198,053
Long-term debt due within one year		—			39,094		—		—			39,094
Current liabilities of discontinued operations		—			—		3,377		—			3,377

Total current liabilities		91,361			211,105		59,551		(10,789	)		351,228
Noncurrent liabilities:
Long-term debt		—			492,443		—		—			492,443
Deferred income taxes		—			1,275,427		32,579		(12,941	)		1,295,065
Intercompany		733,008			185,493		525,788		(1,444,289	)		—
Other		18,740			31,560		60,804		—			111,104
Noncurrent liabilities of discontinued operations		—			—		4,720		—			4,720

Total noncurrent liabilities		751,748			1,984,923		623,891		(1,457,230	)		1,903,332
Shareholders' equity:
Common stock		11,099			100		—		(100	)		11,099
Additional paid-in capital		420,141			45,824		349		(46,173	)		420,141
Retained earnings		4,649,952			5,558,389		244,752		(5,803,141	)		4,649,952
Accumulated other comprehensive income (loss)		(1,377	)		3,856		—		(3,856	)		(1,377	)
Treasury stock, at cost		(182,363	)		—		—		—			(182,363	)

Total shareholders' equity		4,897,452			5,608,169		245,101		(5,853,270	)		4,897,452
Total liabilities and shareholders' equity	$	5,740,561		$	7,804,197	$	928,543	$	(7,321,289	)	$	7,152,012

CONDENSED CONSOLIDATING BALANCE SHEETS (Continued)
(in thousands)

	September 30, 2014, as adjusted
	Guarantor/ Parent			Issuer Subsidiary		Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	(2,050	)	$	329,655	$	36,932	$	(3,628	)	$	360,909
Accounts receivable, net of reserve		(31	)		623,274		98,913		(16,942	)		705,214
Inventories		—			67,113		37,358		1,770			106,241
Deferred income taxes		5,372			19,499		—		(8,352	)		16,519
Prepaid expenses and other		8,863			15,013		56,982		54			80,912
Current assets of discontinued operations		—			—		7,206		—			7,206

Total current assets		12,154			1,054,554		237,391		(27,098	)		1,277,001
Investments		14,344			222,300		—		—			236,644
Property, plant and equipment, net		42,027			4,681,294		465,223		—			5,188,544
Intercompany		14,855			782,626		196,641		(994,122	)		—
Other assets		8,110			1,197		16,123		(6,621	)		18,809
Investment in subsidiaries		5,276,750			235,355		—		(5,512,105	)		—

Total assets	$	5,368,240		$	6,977,326	$	915,378	$	(6,539,946	)	$	6,720,998


LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	80,562		$	80,488	$	20,988	$	(7	)	$	182,031
Accrued liabilities		31,960			212,896		43,560		(6,138	)		282,278
Long-term debt due within one year		—			39,635		—		—			39,635
Current liabilities of discontinued operations		—			—		3,217		—			3,217

Total current liabilities		112,522			333,019		67,765		(6,145	)		507,161
Noncurrent liabilities:
Long-term debt		—			39,502		—		—			39,502
Deferred income taxes		—			1,182,192		47,640		(14,573	)		1,215,259
Intercompany		346,545			141,066		519,512		(1,007,123	)		—
Other		18,196			19,948		25,966		—			64,110
Noncurrent liabilities of discontinued operations		—			—		3,989		—			3,989

Total noncurrent liabilities		364,741			1,382,708		597,107		(1,021,696	)		1,322,860
Shareholders' equity:
Common stock		11,051			100		—		(100	)		11,051
Additional paid-in capital		383,972			42,516		319		(42,835	)		383,972
Retained earnings		4,525,797			5,131,289		250,187		(5,381,476	)		4,525,797
Accumulated other comprehensive income		83,126			87,694		—		(87,694	)		83,126
Treasury stock, at cost		(112,969	)		—		—		—			(112,969	)

Total shareholders' equity		4,890,977			5,261,599		250,506		(5,512,105	)		4,890,977
Total liabilities and shareholders' equity	$	5,368,240		$	6,977,326	$	915,378	$	(6,539,946	)	$	6,720,998

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(in thousands)

	September 30, 2015
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Net cash provided by operating activities	$	3,623		$	1,379,707		$	40,340		$	(4,926	)	$	1,418,744
INVESTING ACTIVITIES:
Capital expenditures		(24,818	)		(1,064,288	)		(44,376	)		—			(1,133,482	)
Purchase of short-term investments		—			(45,607	)		—			—			(45,607	)
Intercompany transfers		24,818			(24,818	)		—			—			—
Proceeds from asset sales		1			21,329			1,171			—			22,501

Net cash provided by (used in) investing activities		1			(1,113,384	)		(43,205	)		—			(1,156,588	)
FINANCING ACTIVITIES:
Payments on long-term debt		—			(40,000	)		—			—			(40,000	)
Proceeds from senior notes, net of discount		—			497,125			—			—			497,125
Debt issuance costs		—			(5,474	)		—			—			(5,474	)
Proceeds on short-term debt					—			1,002						1,002
Payments on short-term debt					—			(1,002	)					(1,002	)
Intercompany transfers		358,021			(358,021	)		—			—			—
Repurchase of common stock		(59,654	)		—			—			—			(59,654	)
Dividends paid		(298,367	)		—			—			—			(298,367	)
Exercise of stock options, net of tax withholding		2,650			—			—			—			2,650
Tax withholdings related to net share settlements of restricted stock		(5,140	)		—			—			—			(5,140	)
Excess tax benefit from stock-based compensation		78			3,665			29			—			3,772

Net cash provided by (used in) financing activities		(2,412	)		97,295			29			—			94,912
Net increase (decrease) in cash and cash equivalents		1,212			363,618			(2,836	)		(4,926	)		357,068
Cash and cash equivalents, beginning of period		(2,050	)		329,655			36,932			(3,628	)		360,909

Cash and cash equivalents, end of period	$	(838	)	$	693,273		$	34,096		$	(8,554	)	$	717,977

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Continued)
(in thousands)

	September 30, 2014
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Net cash provided by (used in) operating activities	$	(21,094	)	$	1,050,609		$	94,196		$	(5,184	)	$	1,118,527
INVESTING ACTIVITIES:
Capital expenditures		(17,786	)		(840,341	)		(94,765	)		—			(952,892	)
Intercompany transfers		17,786			(17,786	)		—			—			—
Proceeds from asset sales		2			27,401			3,367			—			30,770
Proceeds from sale of investments		—			49,205			—			—			49,205

Net cash provided by (used in) investing activities		2			(781,521	)		(91,398	)		—			(872,917	)
FINANCING ACTIVITIES:
Payments on long-term debt		—			(115,000	)		—			—			(115,000	)
Intercompany transfers		264,386			(264,386	)		—			—			—
Dividends paid		(264,386	)		—			—			—			(264,386	)
Exercise of stock options, net of tax withholding		23,250			—			—			—			23,250
Tax withholdings related to net share settlements of restricted stock		(3,049	)		—			—			—			(3,049	)
Excess tax benefit from stock-based compensation		(957	)		27,357			216			—			26,616

Net cash provided by (used in) financing activities		19,244			(352,029	)		216			—			(332,569	)
Net increase (decrease) in cash and cash equivalents		(1,848	)		(82,941	)		3,014			(5,184	)		(86,959	)
Cash and cash equivalents, beginning of period		(202	)		412,596			33,918			1,556			447,868

Cash and cash equivalents, end of period	$	(2,050	)	$	329,655		$	36,932		$	(3,628	)	$	360,909

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Continued)
(in thousands)

	September 30, 2013
	Guarantor/ Parent			Issuer Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Net cash provided by operating activities	$	3,066		$	973,850		$	17,708		$	2,561		$	997,185
INVESTING ACTIVITIES:
Capital expenditures		(6,828	)		(752,642	)		(49,596	)		—			(809,066	)
Intercompany transfers		6,828			(6,828	)		—			—			—
Proceeds from asset sales		3,235			21,694			3,097			—			28,026
Proceeds from sale of investments		—			232,221			—			—			232,221

Net cash provided by (used in) investing activities		3,235			(505,555	)		(46,499	)		—			(548,819	)
Net cash provided by investing activities by discontinued operations		—			—			15,000			—			15,000

Net cash provided by (used in) investing activities		3,235			(505,555	)		(31,499	)		2561			(533,819	)
FINANCING ACTIVITIES:
Payments on long-term debt		—			(40,000	)		—			—			(40,000	)
Intercompany transfers		93,053			(93,053	)		—			—			—
Dividends paid		(93,053	)		—			—			—			(93,053	)
Intercompany notes		(16,500	)		—			16,500			—			—
Exercise of stock options, net of tax withholding		13,317			—			—			—			13,317
Tax withholdings related to net share settlements of restricted stock		(1,677	)		—			—			—			(1,677	)
Excess tax benefit from stock-based compensation		(563	)		10,280			103			—			9,820

Net cash provided by (used in) financing activities		(5,423	)		(122,773	)		16,603			—			(111,593	)
Net increase in cash and cash equivalents		878			345,522			2,812			2,561			351,773
Cash and cash equivalents, beginning of period		(1,080	)		67,074			31,106			(1,005	)		96,095

Cash and cash equivalents, end of period	$	(202	)	$	412,596		$	33,918		$	1,556		$	447,868