v3.26.1
PROPERTY, PLANT AND EQUIPMENT
 9 Months Ended
Jun. 30, 2026
Property, Plant, and Equipment [Abstract]  
PROPERTY, PLANT AND EQUIPMENT
NOTE 3 PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of June 30, 2026 and September 30, 2025 consisted of the following:
(in thousands)Estimated Useful LivesJune 30, 2026September 30, 2025
Drilling services equipment
2 - 15 years
$7,728,614 $8,168,906 
Tubulars
4 years
616,790 597,933 
Real estate properties
10 - 45 years
5,613 8,223 
Other
2 - 23 years
634,193 620,908 
Construction in progress1
161,097 182,942 
9,146,307 9,578,912 
Accumulated depreciation(5,280,975)(5,265,838)
Property, plant and equipment, net$3,865,332 $4,313,074 
Assets held-for-sale$12,659 $15,231 
(1)Included in construction in progress are costs for projects in progress to upgrade or refurbish certain rigs in our existing fleet. Additionally, we include other advances for capital maintenance purchase-orders that are open/in process. As these various projects are completed, the costs are then classified to their appropriate useful life category.
Depreciation and Abandonments
Depreciation expense, including abandonments, was $162.8 million and $160.8 million for the three months ended June 30, 2026 and 2025, respectively. Depreciation expense, including abandonments, was $487.6 million and $405.1 million for the nine months ended June 30, 2026 and 2025, respectively. These expenses are recorded within Depreciation and amortization on our Unaudited Condensed Consolidated Statements of Operations.
In April 2026, an incident involving a rig operating in Texas resulted in a fire that caused significant damage to the asset. Based on information available as of the date of this filing, management has concluded that the rig is a total loss. The rig had a net book value of approximately $11.4 million as of March 31, 2026. The Company maintains insurance coverage for this asset and has initiated a claim with its insurance carrier. Although the insurer's assessment of the claim has not yet been finalized, the Company reached an agreement with the insurer during the three months ended June 30, 2026 for a partial settlement of $25.0 million.
The loss of $11.4 million was recognized as abandonment expense within Depreciation and amortization in the Company's Unaudited Condensed Consolidated Statements of Operations for the three months ended June 30, 2026. Consistent with applicable accounting guidance, the related insurance recovery was recognized in the same financial statement line item and was limited to the amount of the recognized loss. Accordingly, an insurance recovery of $11.4 million offset the abandonment expense during the period. The remaining insurance proceeds of approximately $13.6 million, representing the portion of the partial settlement in excess of the related loss, were recognized in Gain from involuntary conversion in the Company's Unaudited Condensed Consolidated Statements of Operations during the three months ended June 30, 2026. As of June 30, 2026, we received $2.5 million of the related insurance proceeds. The remaining $22.5 million of insurance proceeds was collected in July 2026.
Assets Held-for-Sale
The following is a summary of the changes in the balance (in thousands) of our assets held-for-sale for the period indicated below:
Balance at September 30, 2025
$15,231 
Additions17,491 
Disposals(17,283)
Impairment expense
(2,780)
Balance at June 30, 2026
$12,659 
Fiscal Year 2025 Activity
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.
During the fiscal year ended September 30, 2025, we identified 16 land rigs within our International Solutions operating segment that met the asset held-for-sale criteria with an aggregate net book value of $3.2 million.
Fiscal Year 2026 Activity
In October 2025, we committed to a plan to scrap 30 rigs and auxiliary equipment within our North America Solutions segment and three rigs within our Offshore Solutions segment as part of our strategy to right size our fleet and reduce expenses. Of the 30 North America Solutions rigs, 10 were previously decommissioned. The book values of those assets in our North America Solutions and Offshore Solutions segments were written down to the fair value less estimated cost to sell, and were reclassified as held-for-sale during the nine months ended June 30, 2026. As a result, we recognized a non-cash impairment charge of $97.9 million and $2.1 million in the North America Solutions and Offshore Solutions segments respectively, during the nine months ended June 30, 2026, in the Unaudited Condensed Consolidated Statements of Operations. In March 2026, we identified an additional $2.2 million of Offshore Solutions assets to be sold that were reclassified to held-for-sale. The estimated fair value of the Offshore Solutions assets exceeded the carrying value and therefore no impairment was recognized.
In October 2025, we identified six land rigs, inventory, and auxiliary assets within our International Solutions operating segment that met the asset held-for-sale criteria with an aggregate net book value of $6.4 million. The carrying amounts of these assets were determined to be equal to their estimated fair values; therefore, no impairment charge was recognized. In March 2026, we identified an international drilling rig that met the asset held-for-sale criteria. The rig's net book value of $23.5 million was written down to its estimated scrap value of $0.2 million, which represents fair value, resulting in a non-cash impairment charge of $23.3 million in our International Solutions segment during the nine months ended June 30, 2026. During the nine months ended June 30, 2026, we recognized a non-cash impairment charge of $2.8 million to write down assets previously classified as held‑for‑sale to their estimated fair value less costs to sell. In June 2026, we identified two additional international drilling rigs that met the held-for-sale criteria. The book values of those assets were written down to the fair value less estimated cost to sell. As a result, we recognized a non-cash impairment charge of $1.2 million in our International Solutions segment during the three and nine months ended June 30, 2026.
During the three months ended June 30, 2026, we completed the sale of Utica Square, a shopping center comprising approximately 371,000 leasable square feet located in Tulsa, Oklahoma, and included within our "Other" operations, receiving net proceeds of approximately $127.7 million. After considering the property's net book value and selling costs, the transaction resulted in a $114.8 million gain during the three and nine months ended June 30, 2026. The gain on sale is recorded in Other (gain) loss on sale of assets within our Unaudited Condensed Consolidated Statements of Operations.
Gain on Reimbursement of Drilling Equipment
We recognized a gain of $6.0 million and $18.1 million during the three and nine months ended June 30, 2026 as compared to a gain of $6.8 million and $26.1 million during the three and nine months ended June 30, 2025, respectively, related to customer reimbursement for the current replacement value of lost or damaged drill pipe. Gains related to these tubular assets are recorded in Gain on reimbursement of drilling equipment within our Unaudited Condensed Consolidated Statements of Operations.