Parker Drilling Second Quarter 2008 Net Income Increases 34 Percent

HOUSTON, Aug. 5 /PRNewswire-FirstCall/ -- Parker Drilling Company
(NYSE: PKD), a global drilling contractor and service provider, today
announced that 44 percent revenue growth for the three months ended June 30,
2008 led to a 34 percent increase in profitability compared with the second
quarter of 2007. Other highlights include:
-- Net Income of $22.6 million, or $0.20 per diluted share, a 34 percent
increase over the second quarter 2007;
-- Adjusted EBITDA was 24 percent higher than the second quarter 2007
(adjusted EBITDA is a non-GAAP financial measure defined below);
-- International rig utilization of 75 percent in the second quarter
continues to increase, with four new international land rig
commitments, and is currently at 87 percent, up sequentially from 72
percent in the first quarter;
-- Quail Tools EBITDA increased 29 percent over the second quarter 2007.

"Parker Drilling delivered solid results in the second quarter driven by
gains in our targeted growth areas of international drilling, drilling and
production rental tools, and project management services," said Robert L.
Parker Jr., chairman and chief executive officer.
"Parker's line of services enables the Company to serve customers at
multiple points in the drilling process. The combination of long-term
contracts for our international rig fleet, Quail Tools' lower-risk,
high-margin rental tools business and our non-capital-intensive project
management business strategically positions us to design, build, deliver,
operate and maintain innovative solutions for lowering the total well cost for
our customers.
"We believe that our recent achievements in these businesses, combined
with our relentless focus on execution of our strategic plan, will result in
strengthening returns throughout 2008," Parker concluded.
Second Quarter Earnings and Financial Review
For the three months ended June 30, 2008, Parker posted net income of
$22.6 million, or $0.20 per diluted share, on revenues of $216.7 million,
compared to net income of $16.9 million, or $0.15 per diluted share, on
revenues of $150.3 million for the second quarter 2007. Net income in the
second quarter 2007 included a non-cash charge to tax expense of $4.0 million,
or $0.04 per diluted share, for potential interest and exchange rate
fluctuations relating to a tax liability recorded on January 1, 2007,
associated with the Financial Accounting Standards Board (FASB) Interpretation
No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48").
EBITDA was $69.7 million for the second quarter 2008 compared to $56.3
million in the second quarter 2007 and up sequentially from $61.0 million in
the first quarter. Higher dayrates and utilization resulted in a 159 percent
EBITDA improvement for Parker's international operations over the second
quarter 2007. Quail Tools also showed significant gains, with a 29 percent
EBITDA increase from the second quarter 2007. EBITDA for the U.S. barge
segment was $27.2 million, compared to $32.1 million in the second quarter of
2007. (The definition of the adjusted EBITDA, a non-GAAP financial measure,
for the current and prior eight quarters is reconciled later in this press
release to its most directly comparable GAAP financial measure.)
For the first six months of 2008, Parker reported record revenues of
$390.0 million and net income of $46.5 million or $0.41 per diluted share
compared to revenues of $301.6 million and net income of $46.9 million or
$0.43 per diluted share for the first six months of 2007. Included in 2008
results are a net benefit of $0.04 per diluted share from non-routine items,
comprised of a $1.1 million loss from our Saudi Arabia partnership and a net
tax benefit of $6.4 million (relating to a settlement of the interest portion
of a tax case in Kazakhstan and a valuation allowance on a net operating loss
carry-forward in Papua New Guinea). Included in 2007 results are an after-tax
gain of $0.07 per diluted share from the sale of two workover barge rigs in
January 2007 and non-cash FIN 48 charges of $0.05 per diluted share.
Capital expenditures for the six months ended June 30, 2008 totaled $99.8
million. Total debt was $388.4 million, and total debt to capitalization was
40 percent. The Company's cash and cash equivalents totaled $65.6 million at
June 30, 2008.
Average utilization for the Gulf of Mexico barge rigs for the second
quarter 2008 was 91 percent, up substantially from the 74 percent reported for
the second quarter 2007 and the 76 percent reported for the first quarter
2008. Current barge rig utilization is 87 percent, as deep barge rig 51
entered the shipyard in June for a scheduled refurbishment program. The
Company's deep drilling barge dayrates in the Gulf of Mexico averaged $43,300
per day during the second quarter 2008, compared to $51,600 per day in the
second quarter 2007 and $44,800 per day in the first quarter 2008. (Average
dayrates for each classification of barge by quarter are available on Parker's
website and can be viewed or downloaded by going to "Investor Relations" and
then to "Dayrates - GOM.")
The average utilization of international land rigs for the second quarter
2008 increased to 75 percent, up from the 72 percent reported for the first
quarter 2008 and the 68 percent in the second quarter 2007. With three rigs
mobilizing from an inactive status under contracts secured in the second
quarter and the addition of newbuild rig 269 in Kazakhstan, current
international utilization has increased to 87 percent.
Operations Highlights
-- The Company recently announced a new contract to construct, deliver and
commission a land-based rig for BP to drill ultra extended-reach wells
to offshore targets in the Liberty field of the Alaskan Beaufort Sea.
-- The Company has signed a new contract to design the drilling package
for the Arkutun-Dagi offshore platform. The Arkutun-Dagi field,
offshore Sakhalin Island, Russia, is the third offshore field in the
Sakhalin-1 project to be developed.
-- A Parker subsidiary was awarded a four-year contract in northern Mexico
utilizing land rig 121. Operations are expected to begin in September
2008, after the rig mobilizes from an inactive status in Libya. Upon
arrival, rig 121 will increase the total number of contracted Parker
rigs in Mexico to eight.
-- Land rig 268 mobilized from an inactive status in Colombia for a
one-year contract awarded in May.
-- In July, land rig 188 in New Zealand was awarded a one-year extension
of its current contract in New Zealand.
-- Rig 269, the first of Parker's newbuild high-efficiency class land
rigs, has mobilized to Kazakhstan, joining land rig 247 for a long-term
contract. Rig 247 spud in March, and rig 269 is expected to spud in
August.
-- The Company is currently operating under a Letter of Understanding that
significantly increases the dayrate for barge rig 257, operating in the
Kazakhstan waters of the Caspian Sea, pending execution of an amendment
to the contract for a three-year term.
-- In May, the Company announced the award of a Letter of Intent for a
drilling contract from BP requiring two newbuild land rigs for a
development drilling program in Alaska. Operations are anticipated to
commence during the second half of 2010 after construction and
mobilization to the North Slope.

Parker Drilling has scheduled a conference call at 9 a.m. CDT
(10 a.m. EDT) on Tuesday, Aug. 5, 2008 to discuss second quarter 2008 results.
Those interested in participating in the call may dial in at 303-262-2191.
The conference call replay can be accessed from Aug. 5 through Aug. 12 by
dialing (800) 405-2236 and using the access code 11117359#. Alternatively,
the call can be accessed live through the investor relations section of the
Company's website at http://www.parkerdrilling.com and will be archived on the
site for 12 months. Should severe weather conditions due to Tropical Storm
Edouard disrupt phone service to the company's Houston-based corporate
headquarters, the Parker Drilling second quarter 2008 conference call will be
rescheduled for a later date.
This release contains certain statements that may be deemed to be
"forward-looking statements" within the meaning of the Securities Acts. All
statements, other than statements of historical facts, that address
activities, events or developments that the Company expects, projects,
believes or anticipates will or may occur in the future, including earnings
per share guidance, the outlook for rig utilization and dayrates, general
industry conditions including demand for drilling and customer spending and
the factors affecting demand, competitive advantages including cost effective
integrated solutions and technological innovation, future technological
innovation, future operating results of the Company's rigs and rental tool
operations, capital expenditures, expansion and growth opportunities, asset
sales, successful negotiation and execution of contracts, strengthening of
financial position, increase in market share and other such matters, are
forward-looking statements. Although the Company believes that its
expectations stated in this release are based on reasonable assumptions,
actual results may differ materially from those expressed or implied in the
forward-looking statements. For a detailed discussion of risk factors that
could cause actual results to differ materially from the Company's
expectations, please refer to the Company's reports filed with the SEC, and in
particular, the report on Form 10-K for the year ended December 31, 2007. Each
forward-looking statement speaks only as of the date of this release, and the
Company undertakes no obligation to publicly update or revise any
forward- looking statement.

PARKER DRILLING COMPANY AND SUBSIDIARIES
Consolidated Condensed Statements of Operations
(Unaudited)

Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
(Dollars in Thousands)
DRILLING AND RENTAL
REVENUES
U.S. Drilling $49,368 $56,479 $95,256 $117,457
International Drilling 77,919 43,063 146,659 84,977
Project Management and
Engineering Services 28,951 19,305 48,130 37,711
Construction Contract 20,080 - 20,080 -
Rental Tools 40,412 31,430 79,883 61,405
TOTAL DRILLING AND RENTAL
REVENUES 216,730 150,277 390,008 301,550

DRILLING AND RENTAL
OPERATING EXPENSES
U.S. Drilling 22,130 24,144 43,652 50,893
International Drilling 56,612 34,836 109,233 64,565
Project Management and
Engineering Services 24,707 16,253 40,368 32,319
Construction Contract 19,050 - 19,050 -
Rental Tools 16,030 12,521 31,848 23,684
Depreciation and
Amortization 28,166 19,642 54,332 37,701
TOTAL DRILLING AND RENTAL
OPERATING EXPENSES 166,695 107,396 298,483 209,162

DRILLING AND RENTAL
OPERATING INCOME 50,035 42,881 91,525 92,388

General and Administrative
Expense (8,481) (6,246) (15,149) (12,134)
Gain on Disposition of
Assets, Net 636 269 1,215 16,673

TOTAL OPERATING INCOME 42,190 36,904 77,591 96,927

OTHER INCOME AND (EXPENSE)
Interest Expense (5,876) (5,985) (11,566) (12,315)
Change in Fair Value
of Derivative Position - (28) - (409)
Interest Income 370 1,712 738 3,496
Equity in Loss of
Unconsolidated Joint
Venture and Other
Charges, Net of Taxes - - (1,105) -
Minority Interest - - - (1,000)
Other Income
(Expense) - Net 144 70 204 77
TOTAL OTHER INCOME AND
(EXPENSE) (5,362) (4,231) (11,729) (10,151)

INCOME BEFORE INCOME TAXES 36,828 32,673 65,862 86,776

INCOME TAX EXPENSE (BENEFIT)
Current Tax Expense
(Benefit) 9,488 6,613 (1,155) 28,625
Deferred Tax Expense 4,744 9,200 20,533 11,297
TOTAL INCOME TAX EXPENSE 14,232 15,813 19,378 39,922

NET INCOME $22,596 $16,860 $46,484 $46,854

EARNINGS PER SHARE
- BASIC
Net Income $0.20 $0.15 $0.42 $0.43

EARNINGS PER SHARE
- DILUTED
Net Income $0.20 $0.15 $0.41 $0.43

AVERAGE COMMON SHARES
OUTSTANDING
Basic 111,422,969 109,740,528 110,984,640 108,760,980
Diluted 112,495,655 110,842,121 112,023,524 109,968,329

PARKER DRILLING COMPANY AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Unaudited)

June 30, December 31,
2008 2007
ASSETS (Dollars in Thousands)
CURRENT ASSETS
Cash and Cash Equivalents $65,649 $60,124
Accounts and Notes Receivable, Net 178,937 166,706
Rig Materials and Supplies 27,758 24,264
Deferred Costs 9,872 7,795
Deferred Income Taxes 9,424 9,423
Other Current Assets 53,132 54,871
TOTAL CURRENT ASSETS 344,772 323,183

PROPERTY, PLANT AND EQUIPMENT, NET 627,324 585,888

OTHER ASSETS
Goodwill 100,315 100,315
Deferred Taxes 17,802 40,121
Other Assets 33,008 27,480
TOTAL OTHER ASSETS 151,125 167,916

TOTAL ASSETS $1,123,221 $1,076,987

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current Portion of Long-Term Debt $ - $20,000
Accounts Payable and Accrued Liabilities 119,671 104,180
TOTAL CURRENT LIABILITIES 119,671 124,180

LONG-TERM DEBT 388,397 353,721

LONG-TERM DEFERRED TAX LIABILITY 8,432 8,044

OTHER LONG-TERM LIABILITIES 19,417 56,318

STOCKHOLDERS' EQUITY 587,304 534,724

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,123,221 $1,076,987

Current Ratio 2.88 2.60

Total Long-Term Debt as a Percent of Capitalization 40% 40%

Book Value Per Common Share $5.18 $4.78

PARKER DRILLING COMPANY AND SUBSIDIARIES
Selected Financial Data
(Unaudited)

Three Months Ended
June 30, March 31,
2008 2007 2008
(Dollars in Thousands)
DRILLING AND RENTAL REVENUES
U.S. Offshore Drilling $49,368 $53,141 $45,888
U.S. Land Drilling - 3,338 -
International Land Drilling 64,255 34,135 58,674
International Offshore Drilling 13,664 8,928 10,066
Project Management and Engineering
Services 28,951 19,305 19,179
Construction Contract 20,080 - -
Rental Tools 40,412 31,430 39,471
Total Drilling and Rental Revenues 216,730 150,277 173,278

DRILLING AND RENTAL OPERATING EXPENSES
U.S. Offshore Drilling 22,130 21,077 21,522
U.S. Land Drilling - 3,067 -
International Land Drilling 50,659 29,237 46,056
International Offshore Drilling 5,953 5,599 6,565
Project Management and Engineering
Services 24,707 16,253 15,661
Construction Contract 19,050 - -
Rental Tools 16,030 12,521 15,818
Total Drilling and Rental Operating
Expenses 138,529 87,754 105,622

DRILLING AND RENTAL OPERATING INCOME
U.S. Offshore Drilling 27,238 32,064 24,366
U.S. Land Drilling - 271 -
International Land Drilling 13,596 4,898 12,618
International Offshore Drilling 7,711 3,329 3,501
Project Management and Engineering
Services 4,244 3,052 3,518
Construction Contract 1,030 - -
Rental Tools 24,382 18,909 23,653
Depreciation and Amortization (28,166) (19,642) (26,166)
Total Drilling and Rental Operating
Income 50,035 42,881 41,490

General and Administrative Expense (8,481) (6,246) (6,668)
Gain on Disposition of Assets, Net 636 269 579

TOTAL OPERATING INCOME $42,190 $36,904 $35,401

Marketable Rig Count Summary
As of June 30, 2008

Total

U.S. Gulf of Mexico Barge Rigs
Workover 2
Intermediate 3
Deep 10
Total U.S. Gulf of Mexico Barge Rigs 15

International Land Rigs
Asia Pacific 8
Africa - Middle East 3
Latin America 8
CIS 9
Total International Land Rigs 28

International Barge Rigs
Mexico 1
Caspian Sea 1
Total International Barge Rigs 2

Total Marketable Rigs 45

Adjusted EBITDA
(Unaudited)
(Dollars in Thousands)

Three Months Ending
June 30, March 31, December 31, September 30, June 30,
2008 2008 2007 2007 2007
Net Income from
Continuing
Operations $22,596 $23,888 $34,571 $22,653 $16,860
Adjustments:
Income Tax
(Benefit)
Expense 14,232 5,146 (21,379) 19,180 15,813
Total Other
Income and
Expense 5,362 6,367 30,264 8,767 4,231
Loss/(Gain) on
Disposition of
Assets, Net (636) (579) 784 (543) (269)
Depreciation and
Amortization 28,166 26,166 25,059 23,043 19,642
Provision for
Reduction in
Carrying Value
of Certain
Assets - - 371 1,091 -

Adjusted EBITDA $69,720 $60,988 $69,670 $74,191 $56,277

March 31, December 31, September 30, June 30,
2007 2006 2006 2006
Net Income from
Continuing
Operations $29,994 $37,168 $18,639 $13,761
Adjustments:
Income Tax
(Benefit)
Expense 24,109 (5,954) 13,173 14,694
Total Other
Income and
Expense 5,920 3,554 8,741 5,731
Loss/(Gain) on
Disposition of
Assets, Net (16,404) (672) (4,328) (2,125)
Depreciation and
Amortization 18,059 17,605 16,993 17,715
Provision for
Reduction in
Carrying Value of
Certain Assets - - - -

Adjusted EBITDA $61,678 $51,701 $53,218 $49,776

SOURCE Parker Drilling Company

Investors, David Tucker of Parker Drilling Company, +1-281-406-2370