China Oilfield Services Ltd. Provides Earnings Guidance for the First Half of 2016; Announces Provisions for Impairment
Due to the impact of the market situation, the recoverable amounts of some overseas drilling rigs of the company are lower than the carrying value of these assets, and the company has recognized provision of approximately RMB 3,688,408,000 for fixed asset impairment. Furthermore, the goodwill generated in the acquisition of Awilco Offshore ASA in 2008 was allocated to a group of the drilling services cash-generating units. Based on the impairment test result, the recoverable amount of the group of the drilling services cash-generating units which the goodwill is allocated is lower than its carrying amount. As a result, the Company has recognized provision of approximately RMB 3,455,378,000 for goodwill impairment. The impairment of fixed assets and goodwill is mainly made on the acquired overseas assets.