Dril-Quip Amends 2023 10-K Filing

TL;DR

Dril-Quip filed an amendment to its 2023 10-K, updating asset impairment and restructuring charge details.

AI Summary

Dril-Quip Inc. filed an amendment to its 2023 10-K on July 8, 2024, primarily to update information regarding impairment of intangible assets and restructuring charges. The company, based in Houston, TX, is a manufacturer of oil and gas equipment. This filing provides updated financial disclosures for the fiscal year ending December 31, 2023.

Why It Matters

This amendment provides updated financial details and disclosures for Dril-Quip's 2023 performance, which could impact investor understanding of the company's financial health and strategic adjustments.

Risk Assessment

Risk Level: medium — Amendments to 10-K filings can indicate significant adjustments to financial reporting, potentially highlighting previously undisclosed issues or changes in accounting treatment.

Key Numbers

• 2023 — Fiscal Year End (The period covered by the amended 10-K filing.)
• 20240708 — Filing Date (The date this amendment was submitted to the SEC.)

Key Players & Entities

• Dril-Quip Inc. (company) — Filer of the 10-K/A
• 20231231 (date) — Fiscal year end for the report
• 20240708 (date) — Filing date of the amendment
• Houston, TX (location) — Business and mailing address of Dril-Quip Inc.

FAQ

Key Financial Figures

• $23.27 — ing price of such stock on such date of $23.27. At February 22, 2024, the number of
• $67 m — -downs from 2021 totaling approximately $67 million, including $19.3 million related
• $19.3 million — ng approximately $67 million, including $19.3 million related to the 2018 global strategic pl
• $47.7 million — global strategic plan and approximately $47.7 million due to the discontinuation of certain p
• $105 million — "Great North") for a purchase price of $105 million CAD, approximately $79.8 million, which
• $79.8 m — rice of $105 million CAD, approximately $79.8 million, which is subject to customary ad
• $97.10 — e oil prices fluctuated, with a high of $97.10 per barrel and a low of $71.03 per barr
• $71.03 — high of $97.10 per barrel and a low of $71.03 per barrel. According to the January 20
• $82.49 — crude oil prices averaged approximately $82.49 per barrel in 2023, and the price is fo
• $79.48 — o average $82.49 per barrel in 2024 and $79.48 per barrel in 2025. Even during periods

Filing Documents

• drq-20231231.htm (10-K/A) — 3228KB
• drq-ex19_1.htm (EX-19.1) — 88KB
• drq-ex21_1.htm (EX-21.1) — 27KB
• drq-ex23_1.htm (EX-23.1) — 5KB
• drq-ex31_1.htm (EX-31.1) — 15KB
• drq-ex31_2.htm (EX-31.2) — 12KB
• drq-ex32_1.htm (EX-32.1) — 7KB
• drq-ex32_2.htm (EX-32.2) — 7KB
• drq-ex97_1.htm (EX-97.1) — 13KB
• img17599144_0.jpg (GRAPHIC) — 214KB
• 0000950170-24-082104.txt ( ) — 15791KB
• drq-20231231.xsd (EX-101.SCH) — 1962KB
• drq-20231231_htm.xml (XML) — 3162KB

, Item 1A. Risk Factors

Part I, Item 1A. Risk Factors

, Item 7. Management's Discussion & Analysis

Part II, Item 7. Management's Discussion & Analysis 2 Table of Contents

, Item 8. Financial Statements and Supplementary Data, including the Reports of Independent Registered Public

Part II, Item 8. Financial Statements and Supplementary Data, including the Reports of Independent Registered Public

, Item 9A. Controls and Procedures

Part II, Item 9A. Controls and Procedures This Amended Report also includes revisions and updates to certain other information including, but not limited to, cross-references, an updated signature page and other conforming changes. Pursuant to the rules of the SEC, the exhibit list included in Part IV, Item 15. Exhibits, Financial Statement Schedules of the Original Report has been amended and restated to include updates to applicable exhibits, consisting of currently-dated consents of the independent registered public accounting firm and certifications. In accordance with Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), this Amendment includes new certifications specified in Rule 13a-14 under the Exchange Act, from the Company's Chief Executive Officer and Chief Financial Officer dated as of the date of this Amendment. This Amendment also contains a report of PwC on the Consolidated Financial Statements for each of the three years in the periods ended December 31, 2023 and on the effectiveness of the Company's internal control over financial reporting as of December 31, 2023, and a consent of PwC. This Amendment continues to describe the conditions as of the date of the Original Form 10-K and, except as set forth herein, We have not updated or modified the disclosures contained in the Original Form 10-K to reflect any events that have occurred after the Original Form 10-K. Accordingly, forward-looking statements included in this Amendment may represent management's views as of the Original Form 10-K and should not be assumed to be accurate as of any date thereafter. 3 Table of Contents TABLE OF CONTENTS PART I Item 1.

Business

Business 8 Item 1A.

Risk Factors

Risk Factors 22 Item 1B. Unresolved Staff Comments 34 Item 1C. Cybersecurity 35 Item 2.

Properties

Properties 36 Item 3.

Legal Proceedings

Legal Proceedings 37 Item 4. Mine Safety Disclosure 37 PART II Item 5. Market for Registrant's Common Stock, Related Stockholder Matters and Issuer Purchases of Equity Securities 38 Item 6. [Removed and Reserved] 40 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 41 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 52 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 53 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 89 Item 9A.

Controls and Procedures

Controls and Procedures 89 Item 9B. Other Information 89 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 89 PART III Item 10. Directors, Executive Officers and Corporate Governance 90 Item 11.

Executive Compensation

Executive Compensation 90 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 90 Item 13. Certain Relationships and Related Transactions, and Director Independence 90 Item 14. Principal Accountant Fees and Services 90 PART IV Item 15. Exhibits and Financial Statement Schedules 91 Item 16. Form 10-K Summary 94

Signatures

Signatures 95 4 Table of Contents

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K includes certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Statements contained in all parts of this document that are not historical facts are forward-looking statements that involve risks and uncertainties that are beyond the control of Dril-Quip, Inc. (the "Company" or "Dril-Quip"). You can identify the Company's forward-looking statements by the words "anticipate," "estimate," "expect," "may," "project," "believe" and similar expressions, or by the Company's discussion of strategies or trends. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that these expectations will prove to be correct. These forward-looking statements include the following types of information and statements as they relate to the Company: the impact of actions taken by the Organization of Petroleum Exporting Countries and the expanded alliance (OPEC+) with respect to their production levels and the effects thereof; risks related to the acquisition of Great North, including the risk that the benefits of the transaction may not be fully realized or may take longer to realize than expected; the impact of general economic conditions, including inflationary pressures and interest rates, a general economic slowdown or recession or instability in financial institutions, on economic activity and on our operations; future operating results and cash flow; scheduled, budgeted and other future capital expenditures; planned or estimated cost savings; working capital requirements; the need for and the availability of expected sources of liquidity; the introduction into the market of the Company's future products; the Company's a

Business

Item 1. Business General Dril-Quip, Inc., a Delaware corporation (the "Company" or "Dril-Quip"), is a leading developer of innovative technologies for the energy industry, designing and manufacturing best-in-class products for traditional oil and gas, and certain energy transition applications. The Company designs, manufactures, sells and services highly engineered drilling and production equipment for both offshore and onshore applications. The Company's principal products consist of subsea and surface wellheads, specialty connectors and associated pipes, subsea production systems, mudline hanger systems, production riser systems, dry tree systems, subsea manifolds, line hangers and expandable liner systems, multi-frac well connections, conventional wellhead, thermal wellhead, completion packers and safety and kelly valves. Dril-Quip's products are used by major integrated, large independent and foreign national oil and gas companies and drilling contractors throughout the world. Dril-Quip also provides technical advisory assistance on an as-requested basis during installation of its products, as well as rework and reconditioning services for customer-owned Dril-Quip products. In addition, Dril-Quip's customers may rent or purchase running tools from the Company for use in the installation and retrieval of the Company's products. Dril-Quip has developed its broad line of subsea equipment, surface equipment and offshore rig equipment primarily through its internal product research and development efforts. The Company believes that it has achieved significant market share and brand name recognition with respect to its established products due to the technological capabilities, reliability, cost effectiveness and operational timesaving features of these products. On July 31, 2023, the Company acquired 100% of the issued and outstanding shares of 1185641 B.C. LTD (d/b/a Great North Wellhead and Frac, "Great North") for a purchase price of $105 million CAD, appr

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