PARKER DRILLING CO /DE/, S-3, 1996-05-30

PARKER DRILLING CO /DE/
S-3, 1996-05-30
DRILLING OIL & GAS WELLS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 30, 1996.

REGISTRATION STATEMENT NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
PARKER DRILLING COMPANY
(Exact name of registrant as specified in its charter)

<TABLE>
<S> <C> <C>
DELAWARE 1380 76-0618660
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)

JAMES J. DAVIS
8 EAST THIRD STREET 8 EAST THIRD STREET
TULSA, OKLAHOMA 74103 TULSA, OKLAHOMA 74103
(918) 585-8221 (918) 585-8221
(Address, including zip code, and telephone (Name, address, including zip code, and
number, including area code, of registrant's telephone number, including area code,
principal executive offices) of agent for service)
</TABLE>

Copies to:

<TABLE>
<CAPTION>
<S> <C>
P. DAVID NEWSOME, JR., ESQ. GEORGE W. BILICIC, JR., ESQ.
CONNER & WINTERS, A PROFESSIONAL CORPORATION CRAVATH, SWAINE & MOORE
2400 FIRST PLACE TOWER, 15 EAST 5TH STREET WORLDWIDE PLAZA, 825 EIGHTH AVENUE
TULSA, OKLAHOMA 74103 NEW YORK, NEW YORK 10019
(918) 586-5711 (212) 474-1000
</TABLE>

---------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the Registration Statement becomes effective.
---------------------

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. / /

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / ________________

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. / / ________________

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
---------------------
CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
===============================================================================================
MAXIMUM MAXIMUM
AMOUNT OFFERING AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE PRICE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED(1) UNIT(1) PRICE(1) FEE
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock ($.16 2/3 par
value)....................... 8,050,000 shares(2) $7.375 $59,368,750 $20,472
===============================================================================================
</TABLE>

(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) with respect to the Common Stock
based upon the average of the high and low prices reported on the New York
Stock Exchange on May 22, 1996.

(2) Includes 1,050,000 shares which may be purchased by the Underwriters
pursuant to an over-allotment option.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2

***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A *
* REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT *
* BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************

PROSPECTUS SUBJECT TO COMPLETION, DATED MAY 30, 1996

[PARKER DRILLING LOGO] 7,000,000 SHARES
PARKER DRILLING COMPANY
COMMON STOCK

---------------------

All of the shares of Common Stock offered hereby are being sold by Parker
Drilling Company (the "Company"). The Common Stock is listed on the New York
Stock Exchange under the symbol PKD. On , 1996, the last reported
sale price of the Common Stock on the New York Stock Exchange was $ per
share. See "Price Range of Common Stock and Dividends."

---------------------

SEE "RISK FACTORS" BEGINNING ON PAGE 7 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

---------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1) COMPANY(2)
------------------------------------------------------
<S> <C> <C> <C>
Per Share............................... $ $ $
Total(3)................................ $ $ $
</TABLE>

- ---------------

(1) The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933. See
"Underwriting."
(2) Before deducting expenses payable by the Company estimated to be
$ .
(3) The Company has granted the several Underwriters a 30-day option to purchase
up to an additional 1,050,000 shares of Common Stock on the same terms and
conditions as set forth above solely to cover over-allotments, if any. If
such option is exercised in full, the total Price to Public, Underwriting
Discount and Proceeds to Company will be $ , $ , and
$ , respectively. See "Underwriting."

------------------

The shares of Common Stock are being offered by the several Underwriters
subject to prior sale, when, as and if issued to and accepted by the
Underwriters. The Underwriters reserve the right to reject orders in whole or in
part. It is expected that delivery of the shares of the Common Stock will be
made against payment therefor in New York, New York, on or about ,
1996.

------------------

JEFFERIES & COMPANY, INC.

, 1996
<PAGE> 3

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMPANY'S
COMMON STOCK AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy and information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy and information statements and other information can be inspected and
copied at the public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
following regional offices of the Commission: Seven World Trade Center, Suite
1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511. Copies of such materials can be
obtained by mail from the Public Reference Section of the Commission, at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. Such reports, proxy statements and other information can also be
inspected and copied at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents, filed with the Commission by the Company pursuant
to the Exchange Act, are incorporated herein by reference and made a part of
this Prospectus:

(i) the Company's Annual Report on Form 10-K for the fiscal year ended
August 31, 1995;

(ii) the Company's Quarterly Reports on Form 10-Q for the quarters
ended November 30, 1995 and February 29, 1996; and

(iii) the description of the Common Stock contained in the Company's
registration statement on Form 8-A, dated June 16, 1969, including any
amendment or report heretofore or hereafter filed for the purpose of
updating the description of the Common Stock contained therein.

Each document filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of this Offering shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such document. Any statement contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained in this
Prospectus or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.

THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF
THIS PROSPECTUS IS DELIVERED, ON THE REQUEST OF ANY SUCH PERSON, A COPY OF ANY
OR ALL OF THE FOREGOING DOCUMENTS INCORPORATED HEREIN BY REFERENCE, OTHER THAN
EXHIBITS TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED
BY REFERENCE IN SUCH DOCUMENTS). WRITTEN OR TELEPHONE REQUESTS FOR SUCH COPIES
SHOULD BE DIRECTED TO PUBLIC RELATIONS DEPARTMENT, PARKER DRILLING COMPANY, 8
EAST THIRD STREET, TULSA, OKLAHOMA 74103, TELEPHONE (918) 585-8221.

2
<PAGE> 4

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and consolidated financial statements (including the notes thereto)
included elsewhere in this Prospectus or incorporated by reference herein.
Unless otherwise indicated, the information in this Prospectus assumes the
Underwriters' over-allotment option with respect to the sale of the Common Stock
will not be exercised. References to "Parker" or the "Company" in this
Prospectus include Parker Drilling Company and, unless the context otherwise
requires, its subsidiaries.

THE COMPANY

GENERAL

Parker Drilling Company is a leading provider of land contract drilling
services on a worldwide basis to major, independent and foreign national oil
companies. Since its inception in 1934, the Company has provided drilling
services throughout the United States and 46 foreign countries, giving it the
broadest geographical representation of any land drilling contractor. Currently,
the Company has 46 international rigs in 13 countries and 39 rigs in the United
States. The Company specializes in the drilling of deep and difficult wells and
drilling in remote and harsh environments. Parker also provides a range of
services that are ancillary to its principal drilling services, including
engineering, logistics and construction, as well as various types of project
management.

Internationally, the Company is focused primarily in South America and the
Asia Pacific region where it specializes in drilling that often requires
equipment specially designed to be transported by helicopter, barge or other
vehicles into difficult access areas such as jungle, mountainside or desert
locations. Parker's 23 heli-rigs, with technologically advanced pumps and power
generation systems that are capable of drilling difficult wells in excess of
15,000 feet, have established Parker as the dominant operator in the heli-rig
market. The Company has also historically been a pioneer in new markets or
"frontier areas" such as China, the republics of the former Soviet Union, and
more recently, Vietnam. International operations accounted for approximately 82%
of Parker's fiscal 1995 revenues. Domestically, the Company operates primarily
in the Rocky Mountain, Mid-Continent and Gulf Coast regions and the arctic
region of Alaska. Within the lower 48 states, Parker traditionally has
specialized in the drilling of deep gas wells, often in excess of 20,000 feet.
Domestic operations provided approximately 18% of the Company's fiscal 1995
revenues.

The Company has developed an international reputation for providing
efficient, quality drilling services. This reputation has allowed Parker to
develop relationships with certain major and national oil companies which are
increasingly seeking to establish preferred contractor relationships or
alliances. Management believes that these relationships may result in longer
term work and increased profitability for the Company.

INDUSTRY OVERVIEW

In recent years, many major and independent oil companies have directed a
greater portion of their exploration budgets to foreign markets. This is
particularly true in South America and the Asia Pacific region, where the demand
for land rigs has increased significantly. The Company has benefitted from this
trend due to its long-standing presence in these markets and has been able to
deploy rigs under longer term contracts at higher dayrates and operating margins
than domestic operations. Management believes that the demand for drilling
services in international markets will continue to grow as demand for oil and
gas increases in developing countries and as countries dependent on oil and gas
revenues seek to increase their production. The Company intends to capitalize on
its global presence and substantial international experience to pursue growth
opportunities in both current and developing markets.

3
<PAGE> 5

Parker believes that the activity in U.S. markets will improve over time due to
the growing dependency by the U.S. on volatile foreign energy sources and the
abundance of U.S. natural gas.

BUSINESS STRATEGY

The Company's traditional business strategy has been to focus on domestic
and international markets that require the drilling of deep and difficult wells
and wells in remote areas of difficult access. The Company has pursued this
strategy by providing quality service and equipment to its customers. In 1995,
the Company refined its business strategy to adapt to changing market conditions
and build on its traditional strengths. The Company's current strategy is to:
(i) expand its presence in core markets and enter new productive markets; (ii)
increase the provision of integrated services; (iii) seek acquisitions of
complementary businesses; and (iv) further streamline operations by reducing
operating costs and eliminating non-productive assets.

Expand Core Markets and Enter New Markets

The Company has redeployed a portion of its rig fleet to concentrate its
activities and increase critical mass in its core markets worldwide. The Company
transferred rigs from Yemen, Italy, the Congo, Indonesia and the U.S. to more
active markets in Colombia and in northern and western Argentina. In the
geothermal market, Parker strengthened its position by moving a rig to New
Zealand and is currently moving two rigs to Indonesia. The Company has expanded
its role as a provider of technical expertise through a joint venture agreement
in China and a labor services agreement in Russia. Domestically, the Company has
moved three deep drilling rigs into the active Gulf Coast market.

The recent growth in drilling activity in certain markets in South America,
the Asia Pacific region and Africa has created significant growth opportunities
for the Company. In response to these recent trends, the Company intends to
increase its level of activity in countries in these regions where it currently
operates and to aggressively market additional rigs in countries such as
Venezuela and Algeria.

Increase Provision of Integrated Services

To complement its drilling services, the Company provides integrated
services, which include logistics, engineering, construction and other ancillary
services as well as various types of project management for oil and gas drilling
operations. The Company has entered into agreements for the provision of
engineering services for drilling programs in Argentina and the provision of
specialized services for the construction and mobilization of two rigs on
offshore platforms in connection with a labor contract in the South China Sea.
As oil and gas companies continue to reduce overhead, the Company believes that
opportunities will increase for it to generate revenue by providing services
ancillary to its drilling services without incurring significant capital
expenditures.

Acquisitions of Complementary Businesses

There has been a significant consolidation in the oil service industry as
companies have sought to increase market share and diversify and expand the
scope of services they offer. During 1995, Parker formally engaged the services
of an investment banking firm to assist in identifying and pursuing acquisition
candidates that would allow the Company to provide a broader range of drilling
and related oil field services to its customers. The Company intends to actively
pursue opportunities for growth and diversification within the industry.

Streamline Operations

As part of its efforts to further streamline operations and reduce costs,
the Company closed offices and other facilities in Oklahoma City, Ecuador and
Yemen and reduced overhead in southern Argentina. Excess worldwide equipment and
inventories and domestic real estate have been sold. In addition, over the last
18 months, Parker reduced its rig fleet by 11 rigs. As a result of these steps,
the Company expects to realize annual cost savings, including depreciation, of
approximately $5 million.

4
<PAGE> 6

THE OFFERING

Common Stock Offered................. 7,000,000 shares

Common Stock Outstanding:

Before the Offering(1)............. 56,219,291 shares

After the Offering(1).............. 63,219,291 shares

Use of Proceeds...................... The net proceeds to the Company from
the sale of the Common Stock offered
hereby are estimated to be
approximately $49.1 million. The
Company intends to use such net
proceeds to fund currently scheduled
capital expenditures and expand
international operations. The
remaining net proceeds may be used in
conjunction with existing cash and
cash generated from operations to
facilitate acquisitions of oil
service-related businesses, to
upgrade, acquire or build new rigs
for international and domestic
markets and for general corporate
purposes. See "Use of Proceeds."

New York Stock Exchange Symbol....... PKD
- ---------------

(1) Excludes, as of April 30, 1996, (i) 30,000 shares of Common Stock issuable
upon exercise of outstanding options under the Company's 1994 Non-Employee
Director Stock Option Plan, and (ii) 823,348 shares of Common Stock issuable
upon exercise of options outstanding under the Company's 1994 Executive
Stock Option Plan.

5
<PAGE> 7

SUMMARY OF CONSOLIDATED FINANCIAL DATA

The following table presents for the periods indicated certain historical
consolidated financial data for the Company. The following information should be
read together with "Selected Consolidated Financial Data," "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the consolidated financial statements and notes thereto included elsewhere in
this Prospectus. The results for the six months ended February 29, 1996 are not
necessarily indicative of results for the full year.

<TABLE>
<CAPTION>
SIX MONTHS ENDED
--------------------------- YEAR ENDED AUGUST 31,
FEBRUARY 29, FEBRUARY 28, ----------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------------ ------------ -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues...................... $ 80,639 $ 72,021 $157,371 $152,424 $100,801 $123,332 $112,818
--------- -------- -------- -------- -------- -------- --------
Operating expense:
Drilling and other.......... 56,807 54,532 118,060 121,295 75,188 82,203 85,463
Depreciation, depletion and
amortization.............. 10,712 10,926 21,643 21,950 20,400 20,550 14,712
General and
administrative............ 10,628 10,155 19,165 18,314 17,593 18,385 15,440
Provision for reduction in
carrying value of certain
assets.................... -- -- -- 19,718 -- 19,257 3,268
--------- -------- -------- -------- -------- -------- --------
78,147 75,613 158,868 181,277 113,181 140,395 118,883
--------- -------- -------- -------- -------- -------- --------
Operating income (loss)....... 2,492 (3,592) (1,497) (28,853) (12,380) (17,063) (6,065)
Other income and (expense).... 2,521 3,823 8,597 1,934 1,356 8,692 9,668
--------- -------- -------- -------- -------- -------- --------
Income (loss) from continuing
operations before income
taxes....................... 5,013 231 7,100 (26,919) (11,024) (8,371) 3,603
Income tax expense (benefit).. 2,775 1,255 3,184 1,887 (337) 2,795 1,626
--------- -------- -------- -------- -------- -------- --------
Income (loss) from continuing
operations.................. 2,238 (1,024) 3,916 (28,806) (10,687) (11,166) 1,977
Discontinued operations --
gain on disposal (net of
taxes)...................... -- -- -- -- -- -- 1,184
--------- -------- -------- -------- -------- -------- --------
Net income (loss)............. 2,238 (1,024) 3,916 (28,806) (10,687) (11,166) 3,161
Preferred stock dividends... -- -- -- -- 6 18 25
--------- -------- -------- -------- -------- -------- --------
Earnings (loss) applicable to
common stock................ $ 2,238 $ (1,024) $ 3,916 $(28,806) $(10,693) $(11,184) $ 3,136
========= ======== ======== ======== ======== ======== ========
Weighted average shares
outstanding................. 55,950 54,611 55,333 54,248 53,082 52,115 52,189
EARNINGS (LOSS) PER COMMON
SHARE:
Income (loss) from
continuing operations..... .04 (.02) .07 (.53) (.20) (.21) .04
Net income (loss)........... .04 (.02) .07 (.53) (.20) (.21) .06
OTHER OPERATING DATA:
EBITDA(1)..................... $ 16,622 $ 12,564 $ 30,933 $ 16,056 $ 12,405 $ 34,429 $ 24,521
</TABLE>

<TABLE>
<CAPTION>
AS OF FEBRUARY 29, 1996
-----------------------
ACTUAL AS ADJUSTED(2)
-------- --------
<S> <C> <C>
BALANCE SHEET DATA (UNAUDITED):
Total assets............................................................... $222,466 $271,566
Working capital............................................................ 53,454 102,554
Total debt................................................................. 1,762 1,762
Total stockholders' equity................................................. 191,783 240,883
</TABLE>

- ---------------

(1) EBITDA represents income before income taxes, interest expense,
depreciation, depletion, amortization and certain other non-cash charges.
EBITDA is frequently used by securities analysts and is presented here to
provide additional information about the Company's operations. EBITDA is
not a measurement presented in accordance with generally accepted
accounting principles. EBITDA should not be considered in isolation or as a
substitute for net income, cash flow provided by operating activities or
other income or cash flow data prepared in accordance with generally
accepted accounting principles or as a measure of a company's profitability
or liquidity.

(2) Reflects the issuance of 7,000,000 shares of Common Stock by the Company at
an assumed public offering price of $7.50 per share, resulting in estimated
net proceeds of $49.1 million.

6
<PAGE> 8

RISK FACTORS

Prospective purchasers of the Common Stock offered hereby should carefully
consider the following risk factors, as well as the other information set forth
in this Prospectus.

INDUSTRY CONDITIONS; IMPACT ON COMPANY'S OPERATING RESULTS

The Company's revenues and earnings are affected directly by the worldwide
level of oil and gas exploration and development activity. The level of such
activity is affected by many factors over which the Company has no control,
including, among others, the market prices of oil and gas, the volatility of
such prices, the levels of production by, and other activities of, the
Organization of Petroleum Exporting Countries and other oil and gas producers,
governmental regulation and trade restrictions, the level of worldwide economic
activity, political stability in major oil producing areas, the development of
alternate energy sources and the long-term effect of worldwide energy
conservation measures. Since the early 1980's, the contract drilling business
has been severely impacted by the decline and continued instability in the
prices of oil and natural gas. Substantial uncertainty exists as to the future
level of oil and gas drilling activity.

RISKS OF INTERNATIONAL OPERATIONS

A major portion of the Company's operations are conducted in international
markets, including significant operations in South America and the Asia Pacific
region. International activities accounted for approximately 78% and 82% of the
Company's operating revenues for the six months ended February 29, 1996 and year
ended August 31, 1995, respectively. In addition to the risks inherent in the
drilling business, the Company's international operations are subject to certain
political, economic and other uncertainties, including among others, risks of
war and civil disturbances, expropriation, nationalization, termination of
existing contracts, taxation policies, foreign exchange restrictions and
fluctuations and other risks arising out of foreign governmental sovereignty
over certain areas in which the Company conducts operations. Although the
Company seeks to protect against such risks through insurance, there is no
assurance that insurance will be available for all these risks and for all
operating areas or will be sufficient to cover all losses that could be
incurred. Losses from these factors could be material in those countries which
contain a significant concentration of the Company's assets.

OPERATING HAZARDS; UNINSURED RISKS

The Company's drilling operations are subject to various hazards inherent
in the drilling of oil and gas wells, including blowouts, reservoir damage, loss
of well control, cratering, and oil and gas well fires. Such events can result
in personal injury or death, severe damage to or destruction of equipment and
facilities, suspension of operations, and substantial damage to surrounding
areas and the property of others. Generally, the Company obtains indemnification
from its customers by contract for certain of these risks. To the extent not
transferred to customers by contract, the Company seeks protection against such
risks through insurance. However, potential liabilities associated with oilfield
casualties or losses could arise in risk categories where no insurance has been
purchased, or where claims exceed the applicable insurance coverage. The
occurrence of events that are not fully insured or the failure of a customer to
meet its indemnification obligations could have a material adverse effect on the
Company's operations and financial condition. In addition, there can be no
assurance that insurance will be available or, even if available, that insurance
premiums or other costs will not rise sharply in the future.

LOSSES FROM OPERATIONS

Although the Company had net income of $2.2 million and $3.9 million for
the six months ended February 29, 1996 and the year ended August 31, 1995,
respectively, the Company experienced net losses for each of the fiscal years in
the three-year period ended August 31, 1994. The profitability of the Company is
materially dependent upon the level of utilization and rates of compensation for
its drilling rigs. Accordingly, due to the volatility in oil and gas exploration
and development activity, there can be no assurance that the Company will remain
profitable in the future. See "--Industry Conditions; Impact on Company's
Operating

7
<PAGE> 9

Results" and "Management's Discussion and Analysis of Financial Condition and
Results of Operations-- Liquidity and Capital Resources."

COMPETITION; CONCENTRATION OF CUSTOMER BASE

The land drilling market is highly competitive, reflecting the continuing
oversupply of drilling rigs, although this oversupply is more pronounced in
domestic than international markets. Drilling contracts are generally awarded on
a competitive bid basis and, while an operator may consider factors such as
quality of service and type and location of equipment as well as the ability to
provide ancillary services, price is generally the primary factor in determining
which contractor is awarded a job. The Company believes that the market for
drilling contracts will continue to be highly competitive for the foreseeable
future because of the worldwide oversupply of drilling rigs. Certain of the
Company's competitors have greater financial resources than the Company, which
may enable them to better withstand industry downturns, to compete more
effectively on the basis of price, to build new rigs or to acquire existing
rigs. There can be no assurance that the Company will be able to compete
successfully against its competitors in the future or that such competition will
not have a material adverse effect on the Company's financial condition and
results of operations.

The Company's customer base is highly concentrated, with its 20 largest
drilling customers representing approximately 91% of total revenues for the
fiscal year 1995. Two customers accounted for approximately 22% and 13% of total
revenues for the same period. There can be no assurance that these customers
will continue to request the Company's services or that the loss of such
customers would not have a material adverse effect on the Company's financial
condition and results of operations.

GOVERNMENTAL REGULATION AND ENVIRONMENTAL MATTERS

Many aspects of the Company's operations are affected by domestic and
foreign political developments and are subject to numerous domestic and foreign
governmental regulations that may relate directly or indirectly to the contract
drilling industry, including environmental and safety matters. The regulations
applicable to the Company's operations include certain regulations that control
the discharge of materials into the environment or require remediation of
contamination under certain circumstances. For example, the Company may be
liable for damages and costs incurred in connection with oil spills for which it
is legally responsible. Certain environmental laws and regulations impose
"strict liability," rendering a person liable without regard to negligence or
fault on the part of such person. Such environmental laws and regulations may
expose the Company to liability for the conduct of, or conditions caused by,
others, or for acts of the Company that were in compliance with all applicable
laws at the time such acts were performed.

The Company has made and will continue to make expenditures to comply with
environmental and safety requirements. Because the requirements imposed by such
laws and regulations are subject to change, the Company is unable to predict the
ultimate cost of compliance with such requirements. The modification of existing
foreign or domestic laws or regulations or the adoption of new laws or
regulations curtailing exploratory or development drilling for oil and gas for
economic, political, environmental or other reasons could materially and
adversely affect the Company's operations by limiting drilling opportunities.
There can be no assurance that laws and regulations enacted in the future,
including changes to existing laws and regulations, will not adversely affect
the Company's business.

8
<PAGE> 10

USE OF PROCEEDS

The net proceeds to the Company from the sale of the Common Stock offered
hereby are estimated to be approximately $49.1 million, assuming a public
offering price of $7.50 per share ($56.5 million, if the Underwriters'
over-allotment option is exercised in full) and after deducting the underwriting
discount and estimated expenses payable by the Company. The Company intends to
use such net proceeds in the following manner: (i) approximately $22 million to
upgrade two rigs for the Papua New Guinea market, three rigs for the Indonesia
geothermal market and four rigs for the Peru market and for other planned
capital expenditures; and (ii) to upgrade and acquire additional rigs for the
Venezuela and Algeria markets and for the Company's existing operations in Chad,
subject to obtaining acceptable drilling contracts. The Company intends to
utilize the remaining proceeds in conjunction with existing cash and cash
generated from operations to facilitate the acquisition of oil service-related
businesses, to upgrade, acquire or build new rigs for international and domestic
markets and for general corporate purposes. Pending application of the net
proceeds from the sale of the Common Stock offered hereby, the Company will
invest such net proceeds in short-term, interest bearing, investment grade
securities.

PRICE RANGE OF COMMON STOCK AND DIVIDENDS

The Company's Common Stock commenced trading on the New York Stock Exchange
in 1975 under the symbol "PKD." The following table sets forth the high and low
sales prices per share of the Common Stock as reported on the New York Stock
Exchange for the periods indicated.

<TABLE>
<CAPTION>
HIGH LOW
------ ------
<S> <C> <C>
1994:
First Quarter.................................................... $7.750 $5.250
Second Quarter................................................... 6.250 4.875
Third Quarter.................................................... 6.250 4.875
Fourth Quarter................................................... 6.375 5.375
1995:
First Quarter.................................................... 6.250 5.000
Second Quarter................................................... 5.125 4.375
Third Quarter.................................................... 5.625 4.375
Fourth Quarter................................................... 5.625 4.625
1996:
First Quarter.................................................... 6.375 4.875
Second Quarter................................................... 6.500 5.000
Third Quarter (through May 28)................................... 8.125 5.375
</TABLE>

No dividends have been paid on the Common Stock since February 1987.
Restrictions contained in the Company's existing credit agreement limit the
payment of cash dividends to the lesser of 40 percent of consolidated net income
for the preceding fiscal year, or $2.6 million. The Company has no present
intention to pay dividends on its Common Stock in the foreseeable future.

9
<PAGE> 11

SELECTED CONSOLIDATED FINANCIAL DATA

The historical financial data presented in the table below for and at the
end of each of the years in the five-year period ended August 31, 1995 are
derived from the consolidated statements of the Company audited by Coopers &
Lybrand L.L.P., independent accountants. The historical financial data presented
in the table below for and at the end of each of the six-month periods ended
February 29, 1996 and February 28, 1995 are derived from the unaudited
consolidated condensed financial statements of the Company. In the opinion of
management of the Company, such unaudited consolidated condensed financial
statements include all adjustments (consisting of normal recurring adjustments)
necessary for a fair presentation of the financial data for such periods. The
results for the six months ended February 29, 1996 are not necessarily
indicative of the results to be achieved for the full year.

The data presented below should be read in conjunction with the Company's
consolidated financial statements and the notes thereto included elsewhere in
this Prospectus and "Management's Discussion and Analysis of Financial Condition
and Results of Operations."

STATEMENT OF OPERATIONS DATA:
Revenues:
Drilling contracts..................... $ 78,280 $ 69,780 $153,075 $147,480 $ 96,719 $116,082 $107,167
Other.................................. 2,359 2,241 4,296 4,944 4,082 7,250 5,651
-------- -------- -------- -------- -------- -------- --------
80,639 72,021 157,371 152,424 100,801 123,332 112,818
-------- -------- -------- -------- -------- -------- --------
Operating expense:
Drilling............................... 53,987 51,867 113,132 114,732 69,237 74,196 80,344
Other.................................. 2,820 2,665 4,928 6,563 5,951 8,007 5,119
Depreciation, depletion and
amortization......................... 10,712 10,926 21,643 21,950 20,400 20,550 14,712
General and administrative............. 10,628 10,155 19,165 18,314 17,593 18,385 15,440
Provision for reduction in carrying
value of certain assets.............. -- -- -- 19,718 -- 19,257 3,268
-------- -------- -------- -------- -------- -------- --------
78,147 75,613 158,868 181,277 113,181 140,395 118,883
-------- -------- -------- -------- -------- -------- --------
Operating income (loss).................. 2,492 (3,592) (1,497) (28,853) (12,380) (17,063) (6,065)
Other income and (expense):
Interest income (expense) -- net....... 646 542 1,184 1,150 1,676 1,592 4,424
Minority interest...................... -- -- (227) (135) 149 596 920
Other.................................. 1,875 3,281 7,640 919 (469) 6,504 4,324
-------- -------- -------- -------- -------- -------- --------
2,521 3,823 8,597 1,934 1,356 8,692 9,668
Income (loss) from continuing operations
before income taxes.................... 5,013 231 7,100 (26,919) (11,024) (8,371) 3,603
Income tax expense (benefit)............. 2,775 1,255 3,184 1,887 (337) 2,795 1,626
-------- -------- -------- -------- -------- -------- --------
Income (loss) from continuing
operations............................. 2,238 (1,024) 3,916 (28,806) (10,687) (11,166) 1,977
Discontinued operations -- gain on
disposal (net of taxes)................ -- -- -- -- -- -- 1,184
-------- -------- -------- -------- -------- -------- --------
Net income (loss)........................ 2,238 (1,024) 3,916 (28,806) (10,687) (11,166) 3,161
Preferred stock dividends.............. -- -- -- -- 6 18 25
-------- -------- -------- -------- -------- -------- --------
Earnings (loss) applicable to common
stock.................................. $ 2,238 $ (1,024) $ 3,916 $(28,806) $(10,693) $(11,184) $ 3,136
======== ======== ======== ======== ======== ======== ========
Weighted average shares outstanding...... 55,950 54,611 55,333 54,248 53,082 52,115 52,189
EARNINGS (LOSS) PER COMMON SHARE:
Income (loss) from continuing
operations............................. .04 (.02) .07 (.53) (.20) (.21) .04
Net income (loss)........................ .04 (.02) .07 (.53) (.20) (.21) .06
OTHER OPERATING DATA:
EBITDA(1)................................ $ 16,622 $ 12,564 $ 30,933 $ 16,056 $ 12,405 $ 34,429 $ 24,521
BALANCE SHEET DATA:
Total assets............................. $222,466 $207,879 $216,959 $209,348 $236,342 $245,869 $264,794
Working capital.......................... 53,454 47,889 56,042 40,670 60,253 58,561 63,114
Total debt............................... 1,762 1,850 2,037 -- -- 932 7,116
Redeemable preferred stock............... -- -- -- -- -- 157 315
Total stockholders' equity............... 191,783 181,126 186,920 180,583 207,679 210,181 219,082
</TABLE>

- ---------------

10
<PAGE> 12

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OUTLOOK

The Company's operating strategy has been to actively pursue land drilling
contract opportunities in international and domestic markets. Although the
domestic market has been depressed over the last several years, international
drilling markets have generally been more active and profitable, prompting the
Company to devote the majority of its capital budget to its international fleet.

In fiscal 1995, approximately 82% of the Company's revenues came from
international operations. The Company anticipates that the international markets
will remain strong for the foreseeable future as demand for oil and gas
increases in developing countries and countries dependent on oil and gas
revenues seek to increase their production. Management believes that the Company
is favorably positioned to respond to and benefit from the continued increase in
international drilling markets.

Domestically, the Company's fleet of rigs is particularly suited for
drilling deep wells in the Rocky Mountain, Mid-Continent and Gulf Coast regions,
where the Company has focused on deep and/or difficult drilling projects. In the
arctic region of Alaska, where the Company operates one rig, the dayrates are
higher due to the need for more sophisticated drilling equipment. In 1995,
drilling activity in the U.S. Gulf Coast market strengthened due to improved
natural gas prices. Three of the Company's rigs have recently been relocated to
this active Gulf Coast market, and the Company is seeking additional contracts
in this market. While the increase in prices and demand in the Gulf Coast may
eventually spread to other domestic markets, the Company is not predicting any
increase in near-term demand for domestic deep drilling services.

RESULTS OF OPERATIONS

Six Months Ended February 29, 1996 Compared to Six Months Ended February 28,
1995

The Company's net income of $2.2 million recorded for the first six months
of fiscal 1996 is an improvement of $3.3 million over the first half of the
prior fiscal year. An increase in drilling margins of $6.4 million was the
primary reason for the improvement, offset by a $1.5 million increase in tax
expense and a $1.3 million reduction in other income.

Drilling revenue of $78.3 million reflected an increase of $8.5 million
from $69.8 million for the first half of fiscal 1995. Utilization in the first
six months of the current fiscal year of 44% for the entire rig fleet and 62%
solely for the international fleet corresponds to the first six months of fiscal
1995 rates of 38% and 55%, respectively. (Utilization rates have been adjusted
for both periods for rigs removed from the rig fleet in both fiscal 1995 and
1996.)

Drilling revenue in the Company's Western Hemisphere international
operations declined $2.9 million due to reduced utilization in Argentina
resulting from the Company's termination of operations in southern Argentina
during the second quarter of 1996. Operations in the Asia Pacific region
generated an increase in revenue of $7.8 million. This increase is attributable
to improved utilization in Papua New Guinea where the Company operated five rigs
during the first two quarters of fiscal 1996 compared to two rigs during the
corresponding period of 1995. Revenue through six months of fiscal 1996 declined
in the Asia Pacific countries of Pakistan, New Zealand and the Philippines.

Drilling revenue in Africa, the Middle East and Commonwealth of Independent
States ("CIS") declined $0.8 million due to the completion of one-rig contracts
in Chad and Kazakstan in the first half of fiscal 1995, offset by increased
revenue in the Russian Republic where the Company commenced a one-rig contract
in the first quarter of fiscal 1996. Domestic drilling revenue increased $4.6
million due primarily to the operation of Rig 245 in Alaska. This rig had been
idle during the first quarter of fiscal 1995.

Drilling margins (drilling revenues less drilling expenses) increased $6.4
million to $24.3 million for the first six months of fiscal 1996 from $17.9
million for the first half of fiscal 1995 due to improved operations in
Colombia, Argentina, Papua New Guinea and Alaska.

11
<PAGE> 13

General and administrative expense increased $0.5 million to $10.6 million
from $10.1 million due to employee severance payments made in fiscal 1996 while
other income declined $1.3 million from $3.8 million in fiscal 1995, which
included a $1.5 million gain due to a reversal of a prior year's foreign
currency accrual. Income tax expense increased $1.5 million due to increased
revenue and taxable income in certain foreign countries in which the Company
operates.

Year Ended August 31, 1995 Compared to Year Ended August 31, 1994

The fiscal 1995 net income of $3.9 million was an improvement of $32.7
million over the net loss of $28.8 million recorded in fiscal 1994. Excluding a
$19.7 million provision for reduction in carrying value of certain assets from
fiscal 1994's net loss, fiscal 1995's net income was an improvement of $13.0
million over fiscal 1994. The primary reasons for the improvement in fiscal 1995
were an increase in drilling margins of $7.2 million and an increase in other
income of $6.7 million.

Drilling contract revenue increased $5.6 million to $153.1 million from
$147.5 million even though international and domestic operating days were nearly
the same as the previous year. An increase in the utilization of larger rigs in
northern Argentina and Colombia more than offset decreased utilization of
smaller rigs in southern Argentina. Although operating days were nearly the
same, the domestic utilization rate increased from 15% to 21% due to the
retirement/disposal of 16 domestic rigs in 1994. (Rigs retired, disposed of or
reclassified as assets held for sale in fiscal 1995 and 1994 have been treated
as removed from the rig fleet as of the last day of each fiscal year.)

Western Hemisphere international drilling revenue increased $23.4 million
in fiscal 1995 when compared with fiscal 1994. In Colombia, revenue increased
$13.9 million due primarily to revenue earned by one rig relocated from
Indonesia during the year and from a full year of operations by one rig which
was added to the rig fleet in fiscal 1994. In addition, several rigs which were
either on a standby or stacked status in fiscal 1994 operated all of fiscal
1995. In Argentina, drilling revenue increased $12.6 million as two additional
deep rigs, one relocated from the Congo in fiscal 1994 and one relocated from
Yemen in fiscal 1995, operated much of the year. Additionally, one rig added to
the rig fleet in fiscal 1994 operated all of fiscal 1995 and one rig leased by
the Company commenced operations in the fourth quarter of fiscal 1995. During
fiscal 1995 and 1994, a number of shallow depth capacity rigs (10,000 feet or
less) operated in southern Argentina, many of them operating on a meterage
basis. Two of these rigs have been relocated to mid-Argentina as the Company
focuses its marketing efforts on regions of the country where operations are
generally conducted on a daywork basis. At fiscal year-end, the remaining rigs
in southern Argentina were on a stacked status. Drilling revenue declined $4.8
million in Ecuador where two rigs located in that country did not operate in
fiscal 1995 and were retired from the rig fleet at the end of the fiscal year.

Operations in the Asia Pacific region resulted in an increase in drilling
revenue of $1.5 million in fiscal 1995. Increased utilization in New Zealand and
revenue earned from a labor contract in China more than offset a decline in
revenue in Papua New Guinea and Indonesia due to lower utilization in those
countries.

International drilling revenue from operations in Africa, the Middle East
and the CIS declined $17.4 million in fiscal 1995. Utilization declined due to
the completion of contracts in Chad, the Congo, the Russian Republic, and Yemen.
The rigs which operated in the Congo and Yemen in fiscal 1994 have both been
redeployed to Argentina where they are currently operating. In Kazakstan, a
reduction in revenue from a labor contract in that country was partially offset
by operations from one rig which has been relocated from the Russian Republic.

Domestic drilling revenue declined $2.3 million due to fewer operating days
in the Rocky Mountain states and Alaska.

Drilling margins (drilling revenue less drilling expense) increased $7.2
million in fiscal 1995 to $39.9 million compared to $32.7 million in fiscal
1994. Margins improved in the Company's South American operations, including
both the countries of Colombia and Argentina. Margins had been negatively
impacted in fiscal 1994 in Colombia due to increased operating expenses and
costs associated with the start-up of two rigs. In fiscal 1995, these two rigs
operated for the full year with improved margins when compared with the

12
<PAGE> 14

previous fiscal year. In Argentina, margins also improved as two additional deep
capacity rigs began operating in the northern region of the country and two rigs
operated during the year in the country's middle region. In the Company's other
operating regions, both internationally and domestically, drilling margins as a
percentage of drilling revenue in fiscal 1995 remained relatively consistent
with fiscal 1994.

General and administrative expense increased $0.9 million to $19.2 million
in fiscal 1995 from $18.3 million in fiscal 1994 due to increased amortization
of deferred compensation and legal expenses.

Other income (expense) increased $6.7 million to $8.6 million in fiscal
1995 from $1.9 million in fiscal 1994. Gains of $6.4 million were recognized in
fiscal 1995 from the disposition of property, plant and equipment as the Company
continued its efforts to sell assets that are no longer a part of its current
marketing strategy. In addition, the reversal of a prior year foreign currency
accrual of $1.5 million was recorded in fiscal 1995. Fiscal 1994 other income
included $2.1 million from gains associated with the disposition of property,
plant and equipment, a $1.5 million gain from the reversal of a prior year
foreign payroll tax accrual and a $2.6 million charge for the settlement of
certain litigation. The $1.3 million increase in income tax expense was
primarily attributable to the reversal in 1994 of an accrued foreign tax.

Year Ended August 31, 1994 Compared to Year Ended August 31, 1993

The fiscal 1994 net loss of $28.8 million represents an increase in net
loss of $18.1 million from a $10.7 million net loss in fiscal 1993. However,
excluding the provision for reduction in carrying value of certain assets of
$19.7 million recognized in fiscal 1994, the net loss improved $1.6 million from
fiscal 1993 to fiscal 1994. The primary reasons for the improvement were an
increase in drilling margins of $5.3 million, partially offset by increases in
depreciation expense of $1.6 million and income tax expense of $2.2 million.

During the fourth quarter of fiscal 1994, management analyzed its domestic
operations and made the strategic decision to reorganize certain of these
operations and sell certain of these assets. The Company reduced the carrying
value of certain assets in Alaska, including rigs, spare parts and property to
be sold. The Company wrote down the net realizable value certain of its
Partech(R) manufacturing operations' drilling equipment, property and
inventories that were to be disposed. Domestically, the Company wrote down to
net realizable value certain rigs and rig equipment and removed 16 mechanical
rigs from its fleet. Aggregating the items described above, the Company recorded
a $19.7 million provision during the fourth quarter of fiscal 1994.

Drilling revenue increased by $50.8 million to $147.5 million in fiscal
1994 from $96.7 million in fiscal 1993 as utilization of the Company's
international rig fleet increased from 40% in fiscal 1993 to 56% in fiscal 1994.
Domestic rig utilization increased slightly from 14% to 15%.

Western Hemisphere international drilling revenue increased $21.1 million
from fiscal 1993 to fiscal 1994. Revenue from the country of Argentina increased
$18.5 million as the Company re-entered the Argentina drilling market during the
fourth quarter of fiscal 1993. In Colombia, revenue increased $2.7 million in
fiscal 1994 as the Company engaged in more deep drilling at higher day rates
when compared to fiscal 1993.

International drilling revenue from operations in Asia and the Pacific
increased $20.9 million in fiscal 1994. The primary reasons for the increase
were the resumption of operations in Pakistan during the first quarter of fiscal
1994, and the operation of two geothermal rigs in the Philippines, a new market
for the Company in fiscal 1994. Also contributing to the increase in drilling
revenue was an increase in utilization in Papua New Guinea during fiscal 1994.

Drilling revenue from operations in Africa, the Middle East and the CIS
increased $9.6 million in fiscal 1994. During the fourth quarter of fiscal 1993,
the Company began operating in the republic of Kazakstan under a labor contract
for a major customer. Revenue from operations in Kazakstan increased $6.8
million in fiscal 1994. In the Russian Republic an increase in operating days
for two workover rigs generated an additional $2.3 million in revenue in fiscal
1994 versus fiscal 1993. In Africa, a decline in revenue from decreased
utilization in Chad was offset by revenue from a one-rig contract in the Congo.

13
<PAGE> 15

Domestic drilling revenue declined slightly in fiscal 1994 compared to
fiscal 1993. An increase in utilization in the continental United States could
not completely offset the loss of revenue from the Company's specialized Arctic
drilling rig, which was released late in the third quarter of fiscal 1994.

Although drilling revenue increased $50.8 million in fiscal 1994 versus
fiscal 1993, drilling margins (drilling revenue less drilling expense) did not
increase proportionately. Drilling margins increased to $32.7 million in fiscal
1994 from $27.5 million in fiscal 1993, an increase of $5.2 million. Drilling
margins in Colombia declined due to increased operating expenses and costs
associated with the start-up of two rigs. In Argentina, the initial start-up
costs of entering a new market and putting ten newly acquired rigs to work
negatively impacted drilling margins. Additionally, during this transition
period, the Company encountered drilling problems which resulted in slower than
expected drilling progress on some of the meterage rate contracts.

Depreciation expense increased $1.6 million in fiscal 1994, the result of
an increase in capital spending during 1994. Other income (expense) increased
$0.6 million to $1.9 million in fiscal 1994 compared to $1.4 million in fiscal
1993. Interest income, net of interest expense, decreased $0.5 million due to a
decline in cash and short-term investments during fiscal 1994.

Other income in fiscal 1994 included a $1.0 million gain recognized when
proceeds from an insurance settlement exceeded the book value of equipment
damaged in connection with a blowout on an international rig. Fiscal 1994 other
income also included the reversal of a prior year foreign payroll tax accrual
totalling $1.5 million. Offsetting this income in fiscal 1994 was a $2.6 million
charge for the settlement of litigation. See Note 9 to the Company's
consolidated financial statements included elsewhere in this Prospectus. Fiscal
1993 other expense included a $0.9 million adjustment of a prior year's workers'
compensation liability. Income tax expense increased $2.2 million primarily
because of an increase in international drilling activity, which resulted in an
increase in current tax expense.

LIQUIDITY AND CAPITAL RESOURCES

Working capital of the Company was $56.0 million as of August 31, 1995, and
$53.5 million as of February 29, 1996. Cash and short-term investments comprised
$22.1 million and $21.3 million of working capital on these respective dates.
Sources of cash for the first six months of fiscal 1996 included cash generated
from operations of $12.8 million, proceeds of $4.2 million from the sale of
property, plant and equipment and $1.6 million received upon the exercise of
stock warrants.

Capital expenditures for the first eight months of fiscal 1996 were $22.9
million, which were primarily related to international contract opportunities.
Management currently forecasts capital expenditures for the next six to nine
months to be approximately $22 million. In the event the Company obtains
additional contracts that require the purchase or construction of new or
specialized rigs, or significant modifications to existing rigs, capital
expenditures could increase further. Any significant increase in capital
expenditures would be subject to restrictions imposed on the Company as
specified below.

The Company has entered into a $15.0 million revolving credit and letter of
credit facility which expires on April 19, 1999 (the "Agreement"). At April 30,
1996, the Company had letters of credit totalling $10.4 million under the
Agreement. The Agreement contains restrictions on annual capital expenditures
and certain senior and subordinated indebtedness which can be incurred by the
Company and certain operating subsidiaries designated in the Agreement through
which the Company performs the majority of its drilling operations. The
Agreement also limits payment of dividends on Common Stock and requires the
Company to maintain certain financial ratios. The remaining subsidiaries of the
Company are not a party to the Agreement and are able to make capital
expenditures with independent financing from lenders that have no recourse to
the Company and the designated subsidiaries, subject only to an overall
limitation of indebtedness. The restrictions in the Agreement are not
anticipated to restrict growth or investment opportunities in the foreseeable
future.

Management believes that the current level of cash and short-term
investments, together with cash generated from operations and the sale of the
Common Stock offered hereby, should be sufficient to meet the

14
<PAGE> 16

Company's immediate capital needs as well as capital required in connection with
additional contracts which the Company is currently bidding or anticipates will
arise in the near future. Should opportunities for growth requiring additional
capital arise beyond current anticipated levels, the Company believes it would
be able to satisfy these needs through a combination of cash generated from
operations, borrowings under the bank credit agreement and either equity or
long-term debt financing.

OTHER MATTERS

In March 1995, Statement of Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to be
Disposed of" was issued. The statement establishes accounting standards for the
impairment of long-lived assets, such as the Company's drilling, transportation
and other equipment and will be effective for the Company beginning with the
year ending August 31, 1997. The Company does not believe the new standard will
have a material effect on the Company's financial position or results of
operations.

In October 1995, Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" was issued. The statement requires the
computation of compensation for grants of stock, stock options and other equity
instruments issued to employees based on fair value. The compensation calculated
is to be either recorded as an expense in the financial statements or,
alternatively, disclosed. The Company anticipates it will elect the disclosure
method of complying with the new standard. Under the provisions of the new
statement, it is anticipated pro forma net income to be disclosed will be lower
than net income reported in the financial statements.

BUSINESS
GENERAL

The Company is a leading provider of land contract drilling services on a
worldwide basis to major, independent and foreign national oil companies. Since
its inception in 1934, the Company has provided drilling services throughout the
United States and 46 foreign countries, giving it the broadest geographical
representation of any land drilling contractor. Currently, the Company has 46
international rigs in 13 countries and 39 rigs in the United States. The Company
specializes in the drilling of deep and difficult wells and drilling in remote
and harsh environments. Difficult well conditions can include zones of high
pressure and/or high temperature, poisonous gases and complex geology. Parker
also provides a range of services that are ancillary to its principal drilling
services, including engineering, logistics and construction, as well as various
types of project management.

Internationally, the Company is focused primarily in South America and the
Asia Pacific region where the Company specializes in drilling that often
requires equipment specially designed to be transported by helicopter, barge or
other vehicles into difficult access areas such as jungle, mountainside or
desert locations. Parker's 23 heli-rigs, with technologically advanced pumps and
power generation systems that are capable of drilling difficult wells in excess
of 15,000 feet, have established Parker as the dominant operator in the heli-rig
market. The Company has also historically been a pioneer in new markets or
"frontier areas" such as China, the republics of the former Soviet Union, and
more recently, Vietnam. International operations accounted for approximately 82%
of Parker's fiscal 1995 revenues. Domestically, the Company operates primarily
in the Rocky Mountain, Mid-Continent and Gulf Coast regions and the arctic
region of Alaska. Within the lower 48 states, Parker traditionally has
specialized in the drilling of deep gas wells, often in excess of 20,000 feet.
Domestic operations provided approximately 18% of the Company's fiscal 1995
revenues.

The Company's principal executive offices are located at 8 East Third
Street, Tulsa, Oklahoma 74103, and its telephone number is (918) 585-8221.

15
<PAGE> 17

INDUSTRY OVERVIEW

In recent years, many major and independent oil companies have directed a
greater portion of their exploration budgets to foreign markets. This is
particularly true in South America and the Asia Pacific region, where the demand
for land rigs has increased significantly. The Company has benefitted from this
trend due to its longstanding presence in these markets and has been able to
deploy rigs under longer term contracts at higher dayrates and operating margins
than domestic operations. Management believes that the demand for drilling
services in international markets will continue to grow as demand for oil and
gas increases and countries dependent on oil and gas revenues seek to increase
their production. The Company intends to capitalize on its global presence and
substantial international experience to pursue growth opportunities in both
current and developing markets.

In the U.S., the land drilling industry is characterized by an oversupply
of rigs and a large number of competitors, which has resulted in lower
utilization and profitability for many drilling contractors. Over the past year,
however, increasing gas prices in certain areas of the United States have led to
a marked increase in drilling in such regions. In addition, the U.S. land
drilling market has undergone significant consolidation. Parker believes that
the activity in U.S. markets will improve over time due to the growing
dependency by the U.S. on volatile foreign energy sources and the abundance of
U.S. natural gas.

BUSINESS STRATEGY

Expand Core Markets and Enter New Markets

Increase Provision of Integrated Services

16
<PAGE> 18

Acquisitions of Complementary Businesses

Streamline Operations

RIG FLEET

The Company provides contract drilling services through its rig fleet. The
sections which follow describe the characterization and utilization of that
fleet and its current status. See "-- International Operations" and "-- Domestic
Operations." The following table sets forth, as of March 31, 1996, the locations
of the Company's rigs and their drilling depth ratings.

<TABLE>
<CAPTION>
DRILLING DEPTH RATING IN FEET
-----------------------------------------------------------------
10,000
OR OVER
LESS 15,000 20,000 25,000 25,000 TOTAL
------ ------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C>
DOMESTIC:
Alaska............................... -- -- -- -- 1 1
Mid-Continent........................ -- 3 17 1 -- 21
Rocky Mountains...................... 1 -- 9 -- 4 14
Gulf Coast........................... -- -- -- -- 3 3
- -- -- - -- --
Total Domestic......................... 1 3 26 1 8 39
- -- -- - -- --
INTERNATIONAL:
South America........................ 1 2 9 2 5 19
Africa, Middle East and CIS.......... 3 2 2 -- -- 7
Asia Pacific......................... 4 4 9 3 -- 20
- -- -- - -- --
Total International.................... 8 8 20 5 5 46
- -- -- - -- --
Total.................................. 9 11 46 6 13 85
= == == = == ==
</TABLE>

INTERNATIONAL OPERATIONS

International land drilling markets have continued to improve since the
late 1980's, resulting in increased margins and utilization rates in several
areas, primarily in South America and the Asia Pacific region and to a lesser
extent in China and the CIS. The international market differs from the domestic
market in terms of its competition, its customers, the equipment requirements
and experience required. The majority of international drilling projects have
the following characteristics: (i) a small number of competitors; (ii) customers
who are major, large independent or foreign national oil companies; (iii) remote
locations requiring drilling equipment with a large inventory of spare parts and
often other ancillary equipment; and (iv) drilling of difficult wells requiring
considerable experience. In contrast, a domestic project usually involves: (i)
numerous competitors; (ii) customers who are small, independent operators; (iii)
rig specifications that can be satisfied by small mechanical rigs of which there
is an oversupply; and (iv) drilling of shallow to medium depth wells. See "Risk
Factors -- Risks of International Operations."

South America. Approximately 50% of the Company's drilling revenue was
generated by operations in South America in fiscal 1995. The Company has 19 rigs
located in the South American drilling markets of

17
<PAGE> 19

Colombia, Argentina and Peru. These rigs have been upgraded to meet the demands
of deep, difficult drilling in these areas. Most of these rigs are currently
under contract to major or national oil companies with attractive dayrates. The
Company anticipates it will continue to relocate rigs to the South American
market to meet increased demand for drilling in these countries as well as other
countries, including Venezuela.

Asia Pacific Region. The Company operates 15 of its fleet of 23 helicopter
transportable rigs in the Asia Pacific region due to the remoteness of the
mountainside and jungle drilling performed in this region. Approximately 30% of
the Company's fiscal 1995 worldwide revenue was generated by operations in the
countries of Papua New Guinea, Indonesia, Philippines, Pakistan and New Zealand.
This region also contains all of the Company's present geothermal operations,
with the Company entering the Philippine geothermal market in 1993 and Indonesia
in 1995. In 1996, the Company became the first land drilling contractor to enter
the Vietnam market subsequent to the liberalization of Vietnam's trading policy
and the lifting of restrictions many countries had placed on doing business with
Vietnam. Also in 1996, the Company formed an alliance with the national drilling
company in China, pursuant to which the Company will provide project management
assistance and rig supervisory personnel to western oil companies in conjunction
with its Chinese partner. Parker has the longest presence of any foreign
drilling contractor in China, beginning with its first contract in 1980.

Africa, Middle East and CIS. Seven of the Company's rigs are currently
located in the Africa, Middle East and CIS markets, which accounted for 5% of
the Company's drilling revenue in fiscal 1995. After becoming the first western
drilling contractor to enter the markets of the former Soviet Union in 1991,
expansion of the Company's business in the former republics which now comprise
the CIS has been hampered by bureaucratic inefficiencies, constantly changing
tax and other laws and political issues that have retarded the investment of
capital by major and large independent oil companies. The Company anticipates
that the recently announced agreement regarding the pipeline to be built to
accommodate incremental production from the Tengiz field will increase
exploration efforts in this region; however, drilling may be delayed pending
resolution of technical, logistical and other issues. The Company is also
currently evaluating reentering the Algerian market as many major companies and
large independents have recently executed agreements to make considerable
investments in existing and new fields in Algeria. Management believes all of
these areas have promise for significant expansion of operations with
accompanying revenues, although the Company's success in these regions is
contingent upon factors over which the Company has no control.

DOMESTIC OPERATIONS

The U.S. land drilling market is highly fragmented with numerous
competitors and an oversupply of rigs. During the past few years, this market
has undergone significant consolidation; however, rig supply continues to exceed
rig demand which has resulted in depressed dayrates and utilization. Due to the
oversupply of rigs, oil companies are in a position to demand rigs equipped with
more sophisticated equipment such as diesel-electric power and/or top-drive
systems. Traditionally, the Company has differentiated itself from its domestic
competitors by specializing in the drilling of deep and/or difficult wells. The
Company also offers drilling services for development drilling on the North
Slope of Alaska with a state of the art arctic drilling unit that is completely
enclosed and transportable on giant "crawlers."

Of the Company's 39 rigs located in the U.S., 16 are diesel-electric and
two are equipped with top drive units, all capable of drilling in excess of
15,000 feet. The balance of the rigs are mechanical rigs equipped for deep
drilling. Absent a significant increase in demand for domestic deep drilling or
the redeployment of these mechanical rigs in international operations, such rigs
have relatively little prospect for work in the foreseeable future. Because most
of the mechanical rigs have been idle for the last several years, substantial
capital expenditures would be required to place these rigs in operating
condition.

18
<PAGE> 20

SPECIALTY DRILLING SERVICES

Helicopter Transportable Rigs. The Company specializes in difficult wells
and drilling in remote areas and harsh environments, primarily in international
locations. A significant factor contributing to the Company's success in
obtaining drilling contracts in remote areas is the use of rigs which are
transportable by air, land and water. These rigs have been specially designed
and constructed by the Company for quick assembly and disassembly under the
proprietary designations "Heli-Hoist(R)" rig, Transportable By Anything(R)
("TBA(R)") rig and All-Terrain ("AT2000E(R)") rig. It is the opinion of
management that the Company's 23 helicopter transportable rigs comprise
approximately 75% of the operational helicopter transportable rigs worldwide.
The Heli-Hoist(R), TBA(R) and AT2000E(R) rigs allow the Company to perform
drilling operations in remote and otherwise inaccessible locations such as
jungle areas, mountainous areas and offshore platforms.

Deep Drilling. During the U.S. drilling boom of the late 1970's and early
1980's, the Company developed its specialty of deep difficult drilling,
primarily in the Anadarko Basin of Western Oklahoma and the Overthrust Region in
the Rocky Mountains. The majority of the expansion of the Company's domestic
fleet was built around this deep gas drilling, during which time the Company
established several drilling depth records approaching 30,000 feet. The
Company's largest drilling rig is rated in excess of 35,000 feet.

During the last several years, drilling activity has shifted from domestic
deep gas drilling to international deep oil and gas drilling. While
international deep drilling is generally in the range of 15,000 feet to 20,000
feet as opposed to the domestic deep drilling which often exceeded 20,000 feet,
the Company has benefitted in the international arena from the development of
this expertise, particularly in the deep drilling markets of the Cusiana and
Cupiagua fields of Colombia and in northern Argentina.

Arctic Drilling. The Company has been one of the pioneers in arctic
drilling conditions and continues to offer new technology to meet the demand for
increased drilling in an ecologically sensitive manner. The Company's most
recent development has been the introduction of a self-contained mobile drilling
unit capable of being moved in one unit by giant "crawlers" similar to the
system used to move rocket thrusters for the space program. The environmentally
sensitive rig also has a complete closed-loop mud system and cuttings processing
system that eliminate the need for mud pits.

Geothermal Drilling. The Company also has developed expertise in the area
of geothermal drilling. Geothermal operations involve drilling into a pocket of
geothermal energy, tapping the source of this energy in the form of steam, hot
water or hot rocks and converting this heat into usable forms of energy. The
market for geothermal drilling is expanding into several areas of the world,
including the Philippines, New Zealand and Indonesia, as various countries elect
to access this alternative form of energy.

Integrated Services. As major oil companies continue to downsize their
engineering and other support staffs, the Company believes the need for drilling
contractors to assume more ancillary duties will increase. As one of the leading
drilling companies with experience in all aspects of land drilling worldwide,
the Company is well positioned to provide different types of integrated services
from logistics and engineering to complete project management services required
by its customers. Parker provided project management for an exploration project
in Papua New Guinea and coordinated the fabrication and testing of two rigs for
offshore platforms in the South China Sea. In addition, Parker's engineers are
working with customers to provide well design programs in Argentina. The Company
has also provided logistics and construction services for a remote drilling
project in Chad and supervision, training and related management services for
workover operations in Kazakstan and drilling operations in China.

19
<PAGE> 21

UTILIZATION

The following table sets forth the utilization rates of the Company's rigs
during each of the periods shown.

<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, ----------------------------
1996 1995 1994 1993 1992
------------ ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
International utilization................................ 62% 54% 56% 40% 52%
Domestic utilization..................................... 25% 21% 15% 14% 13%
</TABLE>

The Company calculates its rig utilization rates on a weighted average
basis assuming 365 days availability for all of its rigs. Rigs which are fully
or partially staffed and on a revenue-producing standby status are considered to
be utilized. Rigs under contract that generate revenues during moves between
locations or during mobilization/demobilization are also considered to be
utilized.

OTHER OPERATIONS

Parker Technology, Inc. ("Partech"), a wholly owned subsidiary of the
Company, is a drilling equipment and manufacturing concern which gives the
Company the ability to design, construct and modify rigs to meet its own unique
needs and, to a lesser extent, to construct rigs and components for other
customers. Partech successfully designed and built the first drilling rig in its
AT2000E(R) series of heli-rigs in 1989. This all-electric rig series features a
proprietary design that provides for additional power and drilling capacity in
remote locations.

COMPETITION

The land drilling market is highly competitive. Management believes
competition for drilling services is based on a number of factors, including:
(i) price; (ii) the type, condition and location of equipment available; (iii)
quality of service, including experience; and (iv) the ability to provide
ancillary services. Management believes that the Company has for many years
ranked at or near the top of the drilling industry in the last three categories.
Since fiscal 1983, the prevailing factor in obtaining contracts domestically has
been price due to the surplus of available rigs in the drilling industry. In
international markets, experience in operating in certain environments and the
developing trend of alliances have also been factors in the selection of the
Company in certain cases, as well as the Company's patented drilling equipment
for remote drilling projects. See "Risk Factors -- Competition; Concentration of
Customer Base."

CUSTOMERS

The Company believes it has developed an international reputation for
providing efficient, quality drilling services. A key for advancing the
Company's business strategy is maintaining and developing relationships and
strategic alliances with its customers. An increasing number of the Company's
customers have been seeking to establish exploration or development drilling
programs based on partnering relationships or alliances with a limited number of
preferred drilling contractors. Such relationships or alliances can result in
longer term work and higher efficiencies that increase profitability for
drilling contractors at a lower overall well cost for oil companies. The Company
is currently a preferred contractor for operators in certain domestic and
international locations, which management believes is a result of the Company's
quality service and experience.

The Company's drilling customer base consists of major, independent and
foreign national oil and gas companies. The Company's 20 largest customers
accounted for approximately 91% of total revenue during fiscal 1995. During
1995, two customers accounted for approximately 22% and 13% of total revenue. In
fiscal 1994, three customers accounted for approximately 14%, 12% and 11% of
total revenue. In fiscal 1993, three customers accounted for approximately 22%,
14% and 10% of total revenue. See "Risk Factors -- Competition; Concentration of
Customer Base."

20
<PAGE> 22

MANAGEMENT

The following table sets forth certain information regarding the directors
and executive officers of the Company.

<TABLE>
<CAPTION>
NAME AGE POSITION
- --------------------------------------------- --- ------------------------------------------
<S> <C> <C>
Robert L. Parker............................. 73 Chairman of the Board of Directors
Robert L. Parker Jr. ........................ 48 President, Chief Executive Officer and
Director
James W. Linn................................ 51 Executive Vice President, Chief Operating
Officer and Director
James J. Davis............................... 49 Vice President of Finance and Chief
Financial Officer
I. E. Hendrix, Jr. .......................... 51 Vice President and Treasurer
Kenneth R. Hoit.............................. 58 Vice President, Planning and Accounting
Leslie D. Rosencutter........................ 40 Vice President, Administration and
Corporate Secretary
T. Bruce Blackman............................ 45 Vice President, Asia Pacific Operations
John R. Gass................................. 44 Vice President, Frontier Areas
Donald D. Goodson............................ 42 Vice President, Latin America Operations
Thomas L. Wingerter.......................... 43 Vice President, North America Operations
Randy L. Ellis............................... 44 Controller
David L. Fist................................ 64 Director
Earnest F. Gloyna............................ 74 Director
R. Rudolph Reinfrank......................... 40 Director
</TABLE>

The following is a brief description of the background and principal
occupation of each director and executive officer:

Mr. Parker, Chairman of the Board, has been a Director since 1954 and
served as President of the Company from 1954 until October 1977, when he was
elected Chairman and Chief Executive Officer. Since December 1991, he has
retained the position of Chairman. He also serves on the board of directors of
MAPCO, Inc., a diversified energy company; Clayton Williams Energy, Inc., a
company engaged in exploration and production of oil and natural gas; and BOK
Financial Corporation, a bank holding company organized under the laws of the
State of Oklahoma. He is the father of Robert L. Parker Jr.

Mr. Parker Jr. has been a Director since 1973 and is President and Chief
Executive Officer. He joined the Company in 1973 and was elected President and
Chief Operating Officer in 1977 and Chief Executive Officer in December 1991. He
was elected Vice President in 1973 and Executive Vice President in 1976. He
currently serves on the board of directors of Alaska Air Group, Inc., the
holding company for Alaska Airlines and Horizon Air Industries. He is the son of
Robert L. Parker.

Mr. Linn has been a Director since 1986, is Executive Vice President and
Chief Operating Officer of the Company and has general charge of the Company's
business affairs and its officers. He joined the Company in 1973 in the
Company's international department. He then served in the Company's domestic
operations, being named northern U.S. district manager in 1976. Mr. Linn was
elected Vice President of U.S. and Canada operations in 1979, was promoted to
Senior Vice President in September 1981 and was elected to his present position
in December 1991.

Mr. Davis has served as Vice President of Finance and Chief Financial
Officer since joining Parker in November 1991. From 1986 through 1991, Mr. Davis
was vice president and treasurer of MAPCO, Inc., a diversified energy company
with interests in coal production and marketing, natural gas liquids production,
marketing and transportation, oil refining and retail motor fuel marketing. He
serves as a member of the board of directors of Dollar Rent A Car Finance
Company.

Mr. Hendrix is Vice President and Treasurer of the Company. He joined
Parker in 1976 as manager of the Company's treasury department and was elected
Treasurer in 1978. Mr. Hendrix was elected Vice

21
<PAGE> 23

President of the Company in April 1983. He serves as a member of the board of
directors of American Performance Mutual Fund.

Mr. Hoit serves as Vice President, Planning and Accounting of the Company.
He joined Parker in 1973. He served as financial analyst and manager of budgets
and analysis prior to being elected a Vice President in April 1983. In June
1991, Mr. Hoit was given additional management responsibilities over corporate
accounting and information systems departments.

Ms. Rosencutter serves as Corporate Secretary and Vice President,
Administration. She has responsibility for the public relations and human
resources departments. She previously had served as Assistant Vice President,
Administration since 1987. Ms. Rosencutter joined Parker in 1974 as secretary to
the Controller and later was secretary to the Robert L. Parker Trust. She has
served as executive secretary and administrative assistant to the Chairman prior
to being elected an officer. She was elected Corporate Secretary in April 1996.

Mr. Blackman serves as Vice President, Asia Pacific Operations. He joined
the Company in 1977 and held management positions in Africa, Singapore and Tulsa
as international accounting manager. In 1983 he was the division manager for the
Indonesian operations. In 1989, he was promoted to contract manager, Asia
Pacific region. He was elected to his current position in January 1996.

Mr. Gass is Vice President, Frontier Areas. He joined the Company in 1977
and has served in various management positions in the Company's international
division. In 1985 he became the division manager of Africa and the Middle East.
In 1987 he directed the Company's mining operations in South Africa. In 1989 he
was promoted to international contract manager. In January 1996, he was
appointed to his current position.

Mr. Goodson serves as Vice President, Latin America Operations. He joined
the Company in 1976 and held various accounting and finance positions prior to
being named contract manager for U.S. operations in 1981. In June 1989, Mr.
Goodson was named Indonesian division manager. In July 1993, he served as
contract manager for the Middle East, Africa and Colombia. In January 1996, he
was elected to his current position.

Mr. Wingerter serves as Vice President, North America Operations. He joined
Parker in 1979, and in 1983 he was named contracts manager for the Rocky
Mountain division. He was promoted to Rocky Mountain division manager in 1984, a
position he held until September 1991 when he was elected a Vice President.

Mr. Ellis was elected Corporate Controller in June 1991. He joined Parker
in 1979 as general accounting supervisor and was named manager of general
accounting in May 1983.

Mr. Fist, a Director since 1986, is a member of the law firm of Rosenstein,
Fist & Ringold, Tulsa, Oklahoma, having been associated with the firm since
1955. He serves as a director of Peoples State Bank and Alliance Business
Investment Company, a federally licensed small business investment company.

Dr. Gloyna has been a Director since 1978 and is presently a chaired
professor in Environmental Engineering at The University of Texas at Austin. He
served as dean, College of Engineering, from April 1970 to August 1987. He is
also a consultant in environmental engineering through Earnest F. Gloyna
Enterprises, and is president of Gloyna Properties, Inc. Dr. Gloyna serves as a
member of the board of trustees of Southwest Research Institute, a nonprofit
research institute that does contract research work for government and industry.

Mr. Reinfrank has been a Director since 1993. Since May 1993, Mr. Reinfrank
has been managing director of the Davis Companies, the holding company for the
Marvin Davis family. Mr. Reinfrank also serves as a managing general partner of
Davis Reinfrank Company. From January 1, 1988 through June 30, 1993, Mr.
Reinfrank was executive vice president of Shamrock Holdings, Inc., the holding
company for the Roy E. Disney family. From January 1990 through December 1992,
Mr. Reinfrank also served as managing director of Trefoil Investors, Inc. and
Shamrock Capital Advisors, Inc., the general partner and management services
company respectively, for Trefoil Capital Investors, L.P. Mr. Reinfrank is a
director of Weatherford Enterra, Inc., an international provider of services and
specialized equipment to the oil and gas industry.

22
<PAGE> 24

DESCRIPTION OF CAPITAL STOCK

The Company has 71,942,000 authorized shares of stock, consisting of (a)
70,000,000 shares of Common Stock, having a par value of $.16 2/3 per share and
(b) 1,942,000 shares of Preferred Stock, having a par value of $1.00 per share.

COMMON STOCK

As of April 30, 1996, there were 56,219,291 shares of Common Stock
outstanding. All of such outstanding shares of Common Stock are fully paid and
nonassessable. Each share of Common Stock has an equal and ratable right to
receive dividends when, as and if declared by the Board of Directors of the
Company out of assets legally available therefor and subject to the dividend
obligations of the Company to the holders of any Preferred Stock then
outstanding. The Company is subject to certain restrictions on the payment of
dividends on, and the repurchase or redemption of, the Common Stock under the
provisions of its existing credit agreement. See "Price Range of Common Stock
and Dividends."

In the event of a liquidation, dissolution or winding up of the Company,
the holders of Common Stock are entitled to share equally and ratably in the
assets available for distribution after payment of all liabilities, and subject
to any prior rights of any holders of Preferred Stock that at the time may be
outstanding.

The holders of Common Stock have no preemptive, subscription, conversion or
redemption rights, and are not subject to further calls or assessments by the
Company. There are no sinking fund provisions applicable to the Common Stock.
Each share of Common Stock is entitled to one vote in the election of directors
and on all other matters submitted to a vote of stockholders. Holders of Common
Stock have no right to cumulate their votes in the election of directors.

PREFERRED STOCK

As of the date of the Prospectus, there were no shares of Preferred Stock
outstanding. Preferred Stock may be issued from time to time in one or more
series at the discretion of the Board of Directors without shareholder approval.
The Board of Directors is also authorized without further approval of the
stockholders to fix the designations, dividends rates, conversion rights,
redemption rights, liquidation price, and sinking fund rights. Depending upon
the rights of such Preferred Stock, its issuance could have an adverse effect on
holders of the Common Stock by delaying or preventing a change in control of the
Company, making removal of the present management of the Company more difficult
or restricting the payment of dividends and other distributions to the holders
of the Common Stock.

POSSIBLE ANTI-TAKEOVER PROVISIONS

The Company's Restated Certificate of Incorporation (the "Company's
Charter") contains certain provisions that might be characterized as
anti-takeover provisions. Such provisions may render more difficult certain
possible takeover proposals to acquire control of the Company and make removal
of management of the Company more difficult.

The Company's Charter provides for the Board of Directors to be divided
into three classes of directors serving staggered three-year terms, with each
class as nearly equal in number as possible. Directors of the Company may only
be removed for cause and only by the affirmative vote of a majority of the then
outstanding shares of stock entitled to vote on the matter. Any stockholder
wishing to submit a nomination to the Board of Directors must follow certain
procedures outlined in the Company's By-Laws. In addition, the By-Laws require
written application by the holders of 75% of the Company's outstanding voting
stock to call a Special Stockholder's Meeting.

Certain outstanding contracts binding on the Company with respect to
certain employees may render more difficult the removal of management or
attempts to acquire control of the Company.

As described above, the Company's Charter authorizes a class of
undesignated Preferred Stock consisting of 1,942,000 shares. Preferred Stock may
be issued from time to time in one or more series, and the Board of

23
<PAGE> 25

Directors, without further approval of the stockholders, is authorized to fix
the rights, preferences, privileges and restrictions applicable to each series
of Preferred Stock. One possible result of authorizing the Board of Directors to
determine such rights, preferences, privileges and restrictions is to eliminate
delays associated with a stockholder vote on specific issuance. The issuance of
Preferred Stock, while providing flexibility in connection with possible
acquisitions and other corporate purposes, could among other things, adversely
affect the voting power of the holders of Common Stock and, under certain
circumstances, make it more difficult for a third party to gain control of the
Company.

The company is incorporated under the laws of State of Delaware. Section
203 of the Delaware General Corporation Law prevents an "interested stockholder"
(defined as a stockholder owning 15% or more of a corporation's voting stock)
from engaging in a business combination with such corporation for a period of
three years from the date such stockholder became an interested stockholder
unless (a) the corporation's board of directors had earlier approved either the
business combination or the transaction by which the stockholder became an
interested stockholder, or (b) upon attaining that status, the interested
stockholder had acquired at least 85% of the corporations's voting stock (not
counting shares owned by persons who are directors and also officers), or (c)
the business combination is later approved by the board of directors and
authorized by a vote of two-thirds of the stockholders (not including the shares
held by the interested stockholder). Since the Company has not amended its
Restated Certificate of Incorporation or By-Laws to exclude the application of
Section 203, such section does apply to the Company and thus may inhibit an
interested stockholder's ability to engage in a business combination with the
Company.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Common Stock is Chemical Bank.

24
<PAGE> 26

UNDERWRITING

Subject to the terms and conditions set forth in the Underwriting
Agreement, the Company has agreed to sell to the Underwriters named below (the
"Underwriters"), for whom Jefferies & Company, Inc. and
are acting as the Representatives, and the Underwriters
have severally agreed to purchase the number of shares of Common Stock set forth
opposite their respective names in the table below at the public offering price
less the underwriting discount set forth on the cover page of this Prospectus:

<TABLE>
<CAPTION>
NUMBER
UNDERWRITERS OF SHARES
------------ ----------
<S> <C>
Jefferies & Company, Inc. .......................................................

---------
Total.................................................................. 7,000,000
=========
</TABLE>

The Underwriting Agreement provides that the obligation of the Underwriters
to purchase the shares of Common Stock offered hereby is subject to certain
conditions. The Underwriters are committed to purchase all of the shares of
Common Stock offered hereby (other than those covered by the over-allotment
option described below), if any are purchased.

The Underwriters propose to offer the shares of Common Stock to the public
at the offering price set forth on the cover page of this Prospectus and to
certain dealers at such price less a concession not in excess of $ per
share. The Underwriters may allow, and such dealers may reallow, a discount not
in excess of $ per share to certain other dealers. After the public
offering of the Common Stock, the public offering price, the concession to
selected dealers and the reallowance to other dealers may be changed by the
Representatives.

The Company has granted the Underwriters an option, exercisable for 30 days
from the date of this Prospectus, to purchase up to 1,050,000 additional shares
of Common Stock at the public offering price, less the underwriting discount. To
the extent such option is exercised, each Underwriter will become obligated,
subject to certain conditions, to purchase additional shares of Common Stock
proportionate to such Underwriter's initial commitment as indicated in the
preceding table. The Underwriters may exercise such right of purchase only for
the purpose of covering over-allotments, if any, made in connection with the
shares of Common Stock offered by this Prospectus.

The Company and all executive officers and directors of the Company have
agreed not to offer for sale, sell or otherwise dispose of any shares of Common
Stock or any securities convertible into or exchangeable for shares of Common
Stock for a period of 90 days from the date of this Prospectus, without the
prior written consent of Jefferies & Company, Inc.; provided, however, that the
Company may issue and sell Common Stock pursuant to any stock bonus plan, stock
grant plan or stock option plan in effect as of the date of this Prospectus.

25
<PAGE> 27

The Representatives have informed the Company that they do not expect the
Underwriters to confirm sales of shares of Common Stock offered by this
Prospectus to any accounts over which they exercise discretionary authority.

The Company has agreed to indemnify the Underwriters against certain
liabilities that may be incurred in connection with the sale of the Common Stock
offered hereby, including liabilities under the Securities Act of 1933, as
amended (the "Securities Act"), or to contribute to payments that the
Underwriters may be required to make in respect thereof.

Pursuant to a letter agreement between the Company and Jefferies & Company,
Inc., Jefferies & Company, Inc. has acted and will continue to act as a
financial advisor to the Company in connection with the acquisition of, merger
or other combination with certain potential acquisition targets. If the Company
completes a transaction with any such target, the Company will pay Jefferies &
Company, Inc. certain usual and customary fees for such services. The Company
has not paid Jefferies & Company, Inc. and is not obligated to pay Jefferies &
Company, Inc., any compensation for services rendered under this agreement to
date.

FORWARD-LOOKING STATEMENTS

This Prospectus includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act, and Section 21E of the Exchange Act. All
statements, other than statements of historical facts, included in this
Prospectus which address activities, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof), expansion
and other development trends of the land contract drilling industry, business
strategy, expansion and growth of the Company's businesses and operations, and
other such matters are forward-looking statements. These statements are based on
certain assumptions and analyses made by the Company in light of its experience
and its perception of historical trends, current conditions and expected future
developments as well as other factors it believes are appropriate in the
circumstances. However, whether actual results and developments will conform
with the Company's expectations and predictions is subject to a number of risks
and uncertainties, including the risk factors discussed in this Prospectus;
general economic, market or business conditions; the business opportunities (or
lack thereof) that may be presented to and pursued by the Company; changes in
laws or regulations; and other factors, most of which are beyond the control of
the Company. Consequently, all of the forward-looking statements made in this
Prospectus are qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by the Company
will be realized or, even if substantially realized, that they will have the
expected consequences to or effects on the Company or its business or
operations.

LEGAL MATTERS

Certain legal matters with respect to the validity of the Common Stock
offered hereby will be passed upon for the Company by Conner & Winters, A
Professional Corporation, Tulsa, Oklahoma. Certain legal matters related to the
offering of the Common Stock will be passed upon for the Underwriters by
Cravath, Swaine & Moore, New York, New York.

INDEPENDENT ACCOUNTANTS

The consolidated balance sheet as of August 31, 1995 and 1994, and the
consolidated statements of operations, redeemable preferred stock and
stockholders' equity, and cash flows for each of the three years in the period
ended August 31, 1995, incorporated by reference or included in this prospectus,
have been included herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
auditing and accounting. With respect to the unaudited interim financial
information for the periods ended November 30, 1995 and 1994 and February 29,
1996 and February 28, 1995, incorporated by reference or included in this
prospectus, the independent accountants have reported that they have applied
limited procedures in accordance with professional standards for a review of
such information.

26
<PAGE> 28

However, their separate reports included in the Company's quarterly reports on
Form 10-Q for the periods ended November 30, 1995 and February 29, 1996, and
incorporated by reference or included herein, states that they did not audit and
they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their reports on such information should
be restricted in light of the limited nature of the review procedures applied.
The accountants are not subject to the liability provisions of Section 11 of the
Securities Act for their report on the unaudited interim financial information
because that report is not a "report" or a "part" of the registration statement
prepared or certified by the accountants within the meaning of Sections 7 and 11
of the Securities Act.

27
<PAGE> 29

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

PARKER DRILLING COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
AUDITED FINANCIAL STATEMENTS OF PARKER DRILLING COMPANY AND SUBSIDIARIES:
Report of Independent Accountants...................................................
Consolidated Balance Sheet as of August 31, 1995 and 1994...........................
Consolidated Statement of Operations for the years ended August 31, 1995, 1994 and
1993.............................................................................
Consolidated Statement of Redeemable Preferred Stock and Stockholders' Equity for
the years ended August 31, 1995, 1994 and 1993...................................
Consolidated Statement of Cash Flows for the years ended August 31, 1995, 1994 and
1993.............................................................................
Notes to Consolidated Financial Statements for the years ended August 31, 1995, 1994
and 1993.........................................................................
UNAUDITED CONDENSED FINANCIAL STATEMENTS OF PARKER DRILLING COMPANY AND SUBSIDIARIES:
Report of Independent Accountants...................................................
Unaudited Consolidated Condensed Balance Sheets as of February 29, 1996, and
August 31, 1995..................................................................
Unaudited Consolidated Condensed Statements of Operations for the six months ended
February 29, 1996 and February 28, 1995..........................................
Unaudited Consolidated Condensed Statements of Cash Flows for the six months ended
February 29, 1996 and February 28, 1995..........................................
Notes to Unaudited Consolidated Condensed Financial Statements for the six months
ended February 29, 1996 and February 28, 1995....................................
</TABLE>

F-1
<PAGE> 30

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders
Parker Drilling Company

We have audited the accompanying consolidated balance sheet of Parker
Drilling Company and subsidiaries as of August 31, 1995 and 1994, and the
related consolidated statements of operations, redeemable preferred stock and
stockholders' equity and cash flows for each of the three years in the period
ended August 31, 1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Parker Drilling
Company and subsidiaries as of August 31, 1995 and 1994, and the consolidated
results of their operations and their cash flows for each of the three years in
the period ended August 31, 1995, in conformity with generally accepted
accounting principles.

COOPERS & LYBRAND L.L.P.

Tulsa, Oklahoma
October 17, 1995

F-2
<PAGE> 31

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
AUGUST 31,
---------------------
1995 1994
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents...................................................... $ 20,752 $ 10,660
Other short-term investments................................................... 1,372 3,811
Accounts and notes receivable, net of allowance for bad debts of $726 in 1995
and $826 in 1994............................................................. 39,578 34,675
Rig materials and supplies..................................................... 11,532 9,117
Other current assets........................................................... 5,146 4,029
-------- --------
Total current assets.................................................... 78,380 62,292
-------- --------
Property, plant and equipment, at cost:
Drilling equipment............................................................. 506,130 538,025
Buildings, land and improvements............................................... 13,259 14,270
Other.......................................................................... 20,470 24,399
Construction in progress....................................................... 14,759 5,247
-------- --------
554,618 581,941
Less accumulated depreciation, depletion and amortization...................... 432,360 454,763
-------- --------
Net property, plant and equipment....................................... 122,258 127,178
-------- --------
Rig materials and supplies....................................................... 6,895 9,127
-------- --------
Deferred charges and other assets:
Assets held for disposition (Note 2)........................................... 2,486 3,518
Notes receivable, net of allowance of $70 in 1995 and $224 in 1994............. 1,817 2,871
Other.......................................................................... 5,123 4,362
-------- --------
Total deferred charges and other assets................................. 9,426 10,751
-------- --------
Total assets............................................................ $216,959 $209,348
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt.............................................. $ 289 $ --
Accounts payable............................................................... 9,539 9,233
Accrued liabilities............................................................ 7,401 7,336
Accrued income taxes........................................................... 5,109 5,053
-------- --------
Total current liabilities............................................... 22,338 21,622
-------- --------
Long-term debt (Note 3).......................................................... 1,748 --
-------- --------
Deferred income tax (Note 4)..................................................... -- 294
-------- --------
Other long-term liabilities...................................................... 5,953 3,596
-------- --------
Minority interest................................................................ -- 3,253
-------- --------
Commitments and contingencies (Note 9)
Preferred stock, $1 par value, 1,942,000 shares authorized, no shares
outstanding.................................................................... -- --
-------- --------
Stockholders' equity:
Common stock, $.16 2/3 par value, authorized 70,000,000 shares, issued and
outstanding 55,722,183 shares (55,112,749 shares in 1994).................... 9,287 9,185
Capital in excess of par value................................................. 205,310 202,403
Retained earnings (accumulated deficit)........................................ (24,391) (28,307)
Other.......................................................................... (3,286) (2,698)
-------- --------
Total stockholders' equity.............................................. 186,920 180,583
-------- --------
Total liabilities and stockholders' equity.............................. $216,959 $209,348
======== ========
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-3
<PAGE> 32

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS
(IN THOUSANDS EXCEPT EARNINGS (LOSS) PER SHARE
AND WEIGHTED AVERAGE SHARES OUTSTANDING)

<TABLE>
<CAPTION>
FOR THE YEARS ENDED AUGUST 31,
----------------------------------------
1995 1994 1993
---------- ---------- ----------
<S> <C> <C> <C>
Revenue:
Drilling contracts................................... $ 153,075 $ 147,480 $ 96,719
Other................................................ 4,296 4,944 4,082
---------- ---------- ----------
157,371 152,424 100,801
---------- ---------- ----------
Operating expense:
Drilling............................................. 113,132 114,732 69,237
Other................................................ 4,928 6,563 5,951
Depreciation, depletion and amortization............. 21,643 21,950 20,400
General and administrative........................... 19,165 18,314 17,593
Provision for reduction in carrying value of certain
assets (Note 2)................................... -- 19,718 --
---------- ---------- ----------
158,868 181,277 113,181
---------- ---------- ----------
Operating income (loss)................................ (1,497) (28,853) (12,380)
---------- ---------- ----------
Other income and (expense):
Interest expense..................................... (88) (11) (53)
Interest income...................................... 1,272 1,161 1,729
Minority interest.................................... (227) (135) 149
Other................................................ 7,640 919 (469)
---------- ---------- ----------
8,597 1,934 1,356
---------- ---------- ----------
Income (loss) before income taxes...................... 7,100 (26,919) (11,024)
---------- ---------- ----------
Income tax expense (benefit)........................... 3,184 1,887 (337)
---------- ---------- ----------
Net income (loss)...................................... $ 3,916 $ (28,806) $ (10,687)
========== ========== ==========
Earnings (loss) per share, primary and fully diluted... $ .07 $ (.53) $ (.20)
========== ========== ==========
Weighted average shares outstanding (fully diluted).... 55,332,541 54,247,664 53,082,078
========== ========== ==========
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-4
<PAGE> 33

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF REDEEMABLE PREFERRED
STOCK AND STOCKHOLDERS' EQUITY
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
OTHER
---------------------------
REDEEMABLE CAPITAL RETAINED UNEARNED
PREFERRED IN EXCESS EARNINGS CURRENCY RESTRICTED
STOCK COMMON OF PAR (ACCUMULATED TRANSLATION STOCK PLAN
SERIES C STOCK VALUE DEFICIT) ADJUSTMENT COMPENSATION
---------- ------ --------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Balances, August 31, 1992............ $ 157 $9,005 $ 197,467 $ 11,192 $(739) $ (6,744)
Redemption of preferred stock...... (157)
Activity in employees' stock
plans........................... 16 524 2,976
Acquisition of stock from certain
employees....................... (11) (373)
Issuance of 925,000 common shares
upon exercise of a warrant at
$4.67 per share................. 154 4,166
Net income (loss).................. (10,687)
Cash dividends on preferred
stock -- $.75 per share......... (6)
Currency translation adjustments
associated with assets of
subsidiary sold................. 866
Cumulative foreign exchange
translation adjustments......... (127)
----- ------ -------- -------- ----- -------
Balances, August 31, 1993............ -- 9,164 201,784 499 -- (3,768)
Activity in employees' stock
plans........................... 28 916 1,070
Acquisition of stock from certain
employees....................... (7) (297)
Net income (loss).................. (28,806)
----- ------ -------- -------- ----- -------
Balances, August 31, 1994............ -- 9,185 202,403 (28,307) -- (2,698)
Activity in employees' stock
plans........................... 111 3,175 (588)
Acquisition of stock from certain
employees....................... (9) (268)
Net income......................... 3,916
----- ------ -------- -------- ----- -------
Balances, August 31, 1995............ $ -- $9,287 $ 205,310 $(24,391) $ -- $ (3,286)
===== ====== ======== ======== ===== =======
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

F-5
<PAGE> 34

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
FOR THE YEARS ENDED AUGUST 31,
--------------------------------
1995 1994 1993
-------- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss).......................................... $ 3,916 $(28,806) $(10,687)
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation, depletion and amortization................ 21,643 21,950 20,400
Loss (gain) on disposition of property, plant and
equipment............................................. (6,395) (2,083) (852)
Provision for reduction in carrying value of certain
assets................................................ -- 19,718 --
Deferred tax expense (benefit).......................... (294) (904) (1,431)
Amortization of deferred compensation and other......... 1,820 2,490 5,197
Change in assets and liabilities:
Accounts and notes receivable......................... (4,105) (10,889) 2,305
Rig materials and supplies............................ (627) (313) 1,696
Other current assets.................................. (1,364) (1,356) (1,934)
Accounts payable and accrued liabilities................ 3,319 1,109 573
Accrued income taxes.................................... 56 (238) (1,349)
Minority interest....................................... 227 135 (149)
Other assets............................................ (260) 137 (48)
-------- -------- --------
Net cash provided by operating activities.......... 17,936 950 13,721
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of property, plant and equipment.... 11,711 4,740 7,150
Capital expenditures....................................... (21,540) (34,764) (18,717)
Proceeds from sale of a subsidiary......................... -- -- 2,353
Investments in affiliates.................................. (501) (140) (177)
Decrease (increase) in other short-term and
long-term investments................................... 2,439 27,608 (7,388)
Other...................................................... 121 -- --
-------- -------- --------
Net cash provided by (used in) investing
activities....................................... (7,770) (2,556) (16,779)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of debt............................. $ 187 $ -- $ --
Principal payments under debt obligations.................. -- -- (777)
Repurchase of common stock................................. (277) (304) (384)
Proceeds from exercise of stock warrant.................... -- -- 4,320
Other...................................................... 16 -- (819)
-------- -------- --------
Net cash provided (used) by financing activities... (74) (304) 2,340
-------- -------- --------
Net increase (decrease) in cash and cash equivalents......... 10,092 (1,910) (718)
Cash and cash equivalents at beginning of year............... 10,660 12,570 13,288
-------- -------- --------
Cash and cash equivalents at end of year..................... $ 20,752 $ 10,660 $ 12,570
======== ======== ========
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest................................................ $ 2 $ 11 $ 47
Income taxes............................................ $ 3,422 $ 3,029 $ 2,361
</TABLE>

Supplemental noncash financing activity:

In November 1994, the Company acquired a limited partner's ownership
interest in two consolidated partnerships in exchange for a promissory note
in the amount of $1,850,000.

In May 1995, the Company received rig materials and supplies valued at
$556,000 in lieu of payment on a note due the Company.

The accompanying notes are an integral part of the consolidated financial
statements.

F-6
<PAGE> 35

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation -- The consolidated financial statements include the accounts
of Parker Drilling Company ("Parker Drilling") and all of its majority-owned
subsidiaries (collectively, the "Company").

Drilling Contracts -- The Company recognizes revenue and expenses on day
rate contracts as the drilling progresses (percentage-of-completion method)
because the Company does not bear the risk of completion of the well. For
meterage contracts, the Company recognizes the revenue and expenses upon
completion of the well (completed-contract method).

Cash and Cash Equivalents -- For purposes of the balance sheet and the
statement of cash flows, the Company considers cash equivalents to be all highly
liquid debt instruments that had a remaining maturity of three months or less at
the date of purchase.

Other Short-term Investments -- Other short-term investments include
primarily certificates of deposit, U.S. government securities and commercial
paper having remaining maturities of greater than three months at the date of
purchase and are stated at the lower of cost or market.

Property, Plant and Equipment -- The Company provides for depreciation of
property, plant and equipment primarily on the straight-line method over the
estimated useful lives of the assets after provision for salvage value. When
properties are retired or otherwise disposed of, the related cost and
accumulated depreciation are removed from the accounts and any gain or loss is
included in operations. Management periodically evaluates the Company's assets
to determine if they are not in excess of their net realizable value. Management
considers a number of factors such as estimated future cash flows, appraisals
and current market value analysis in determining net realizable value. Assets
are written down to reflect any decrease in net realizable value below their net
carrying value (see Note 2).

Rig Materials and Supplies -- Since the Company's foreign drilling
generally occurs in remote locations, making timely outside delivery of spare
parts unlikely, a complement of parts and supplies is maintained for each rig
either at the drilling site or in warehouses close to the operations. During
periods of high rig utilization, these parts are generally consumed and
replenished within a one-year period. During a period of lower rig utilization
in a particular location, the parts, like the related idle rigs, are generally
not transferred to other foreign locations until new contracts are obtained
because of the significant transportation costs which would result from such
transfers. The Company classifies those parts which are not expected to be
utilized in the following year as long-term assets.

Income Taxes and Change in Accounting Policy -- During fiscal 1993, the
Company adopted Statement of Financial Accounting Standards (SFAS) No. 109:
Accounting for Income Taxes. Prior to the change the Company followed SFAS No.
96: Accounting for Income Taxes. Similar to SFAS No. 96, SFAS No. 109 utilizes
the liability method and deferred income taxes (assets) are recorded to reflect
the expected tax consequences in future years of differences between the tax
basis of assets and liabilities and their financial reporting amounts at each
year end. The change in this accounting policy had no effect upon net income for
the year ended August 31, 1993.

Earnings (Loss) Per Share -- Earnings (loss) per share is computed by
dividing net income (loss), as adjusted for dividends on preferred stock, by the
weighted average number of common shares outstanding during the period. Common
shares issued under the 1969 Key Employees Stock Grant Plan, 1980 Incentive
Career Stock Plan and the 1991 Stock Grant Plan are issued and outstanding and
are only considered in the computation of weighted average shares outstanding
when their effect on earnings per share is dilutive.

Concentrations of Credit Risk -- Financial instruments which potentially
subject the Company to concentrations of credit risk consist primarily of trade
receivables with a variety of national and international oil and natural gas
companies. The Company generally does not require collateral on its trade
receivables. Such credit risk is considered by management to be limited due to
the large number of customers comprising

F-7
<PAGE> 36

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

the Company's customer base. The Company places substantially all its
interest-bearing investments with major financial institutions and, by policy,
limits the amount of its credit exposure with respect to any single financial
institution. At August 31, 1995, the Company had deposits in domestic banks in
excess of federally insured limits of approximately $.3 million. In addition,
the Company had deposits in foreign banks of $6.2 million which are not
federally insured.

Fair Market Value of Financial Instruments -- The carrying amount of the
Company's cash and short-term investments and short-term and long-term debt had
fair values that approximated their carrying amounts.

NOTE 2 -- PROVISION FOR REDUCTION IN CARRYING VALUE OF CERTAIN ASSETS

During the fourth quarter of fiscal 1994, management analyzed its domestic
operations and made the strategic decision to reorganize certain of these
operations and sell certain of these assets. In Alaska, the Company decided to
reduce operating and administrative costs and to look for opportunities to enter
into joint ventures or combine operations with other drilling companies. As a
result, the Company reduced the carrying value of certain assets in Alaska,
including rigs, spare parts and property that were to be sold. The Company's
Partech(R) manufacturing operations were downsized by the sale of land,
buildings, equipment and excess inventories, and accordingly, the Company wrote
down to net realizable value certain drilling equipment, property and
inventories that were sold. In the lower 48 divisions, the Company disposed of a
number of mechanical rigs and certain rig equipment which also were written down
to net realizable value. Write-offs relating to the lower 48 and Alaska rigs
resulted in the removal of 16 rigs from the Company's fleet. Aggregating the
items described above, the Company recorded a $19,718,000 provision during the
fourth quarter of fiscal 1994.

NOTE 3 -- LONG-TERM DEBT

<TABLE>
<CAPTION>
AUGUST 31,
----------------
1995 1994
------ ---
(DOLLARS IN
THOUSANDS)
<S> <C> <C>
Parker Drilling
Note payable annually until November 2001 with interest at
5.75%....................................................... $1,850 $--
Parker Drilling International of New Zealand, Ltd.
Note payable monthly through February 2003 to bank with interest
at bank's business lending rate plus margin (total rate at
August 31, 1995 was 11.5%)..................................... 187 --
------ ---
Total debt....................................................... 2,037 --
Less current portion............................................. 289 --
------ ---
Total long-term debt................................... $1,748 $--
====== ===
</TABLE>

The Company's long-term debt matures $289,000 each year for the years 1996
through 2000.

The Company has a credit agreement which provides a $7,500,000 revolving
credit facility through March 1, 1996. The credit agreement was subsequently
amended in the fourth quarter of fiscal 1995 to extend the expiration date to
May 31, 1996. Interest on the revolving credit facility is at prime plus 3/4 of
one percent and commitment fees on the unused credit facility are 1/2 of one
percent. The agreement requires, among other things, maintenance of minimum
working capital and restricts capital expenditures and creation of additional
indebtedness. Under this agreement, the payment of dividends on the Company's
common stock is limited to the lesser of 40 percent of consolidated net income
for the preceding fiscal year or $2,600,000. At August 31, 1995, all of the
credit facility was available for drawdown.

F-8
<PAGE> 37

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 4 -- INCOME TAXES

Income (loss) before income taxes (in thousands) is summarized as follows:

<TABLE>
<CAPTION>
YEARS ENDED AUGUST 31,
--------------------------------
1995 1994 1993
------ -------- --------
<S> <C> <C> <C>
United States........................................ $1,180 $(33,929) $(11,318)
Foreign.............................................. 5,920 7,010 294
------ -------- --------
$7,100 $(26,919) $(11,024)
====== ======== ========
</TABLE>

Income tax expense (benefit) (in thousands) is summarized as follows:

<TABLE>
<CAPTION>
YEARS ENDED AUGUST 31,
-----------------------------
1995 1994 1993
------ ------ -------
<S> <C> <C> <C>
Current:
United States:
Federal............................................ $ -- $ -- $ (110)
State.............................................. -- (246) 6
Foreign............................................... 3,478 3,037 1,198
Deferred:
United States:
Federal............................................ -- (326) --
State.............................................. -- -- --
Foreign............................................... (294) (578) (1,431)
------ ------ -------
$3,184 $1,887 $ (337)
====== ====== =======
</TABLE>

During fiscal 1993, the Company adopted the provisions of Statement of
Financial Accounting Standards (SFAS) No. 109: Accounting for Income Taxes. SFAS
No. 109 requires recognition of deferred tax liabilities and assets for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. Under this method, deferred tax liabilities
and assets are determined based on the difference between the financial
statement and tax basis of assets and liabilities using enacted tax rates in
effect for the year in which the differences are expected to reverse.

Total income tax expense (benefit) differs from the amount computed by
multiplying income (loss) before income taxes by the U.S. federal income tax
statutory rate. The reasons for this difference (dollars in thousands) are as
follows:

<TABLE>
<CAPTION>
YEARS ENDED AUGUST 31,
----------------------------------------------------------
1995 1994 1993
---------------- ----------------- -----------------
% OF % OF % OF
PRETAX PRETAX PRETAX
INCOME INCOME INCOME
AMOUNT (LOSS) AMOUNT (LOSS) AMOUNT (LOSS)
------ ------ ------- ------ ------- ------
<S> <C> <C> <C> <C> <C> <C>
Computed expected tax expense (benefit)... $2,414 34% $(9,153) (34)% $(3,748) (34)%
Foreign tax at rates different than
U.S..................................... 1,171 16% 76 -- (333) (3)%
Utilization of loss carryforwards......... (401) (5)% -- -- -- --
Limitation on recognition of tax
benefit................................. -- -- 11,536 43% 3,848 35%
Other..................................... -- -- (572) (2)% (104) (1)%
--
------ ------- --- ------- ---
Actual tax expense (benefit).............. $3,184 45% $ 1,887 7% $ (337) (3)%
====== == ======= === ======= ===
</TABLE>

F-9
<PAGE> 38

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The components of the Company's tax assets and (liabilities) as of August
31, 1995 and 1994, are shown below (in thousands):

<TABLE>
<CAPTION>
1995 1994
-------- --------
<S> <C> <C>
Domestic:
Deferred tax assets:
Net operating loss and tax credit carryforwards................... $ 67,259 $ 67,379
Reserves established against realization of certain assets........ 1,089 1,455
Accruals not deducted for tax purposes............................ 4,169 4,561
Depreciation of property, plant and equipment..................... 3,385 8,913
-------- --------
75,902 82,308
Deferred tax liabilities:
Depreciation of property, plant and equipment..................... (8,408) (13,503)
-------- --------
Net deferred tax asset............................................... 67,494 68,805
Valuation allowance.................................................. (67,494) (68,805)
-------- --------
$ -- $ --
======== ========
Foreign:
Depreciation of property, plant and equipment........................ $ -- $ 294
-------- --------
Deferred tax liability............................................... $ -- $ 294
======== ========
</TABLE>

At August 31, 1995, the Company had $137,500,000 net operating loss
carryforwards for tax purposes which expire over a fifteen year period beginning
in the year 2000. In addition, the Company had $13,600,000 investment tax credit
carryforwards for tax purposes which expire over a fifteen year period beginning
in the year 1997.

NOTE 5 -- REDEEMABLE PREFERRED STOCK

In January 1984, the Company began redeeming annually one-tenth of the $.75
cumulative Series C preferred stock shares then outstanding and completed the
redemption in January 1993.

NOTE 6 -- COMMON STOCK AND STOCK OPTIONS

The Company's 1969 Key Employees Stock Grant Plan (formerly the 1969 Key
Employees Stock Option Plan) was amended in December 1990 to provide for the
issuance of 223,000 shares of common stock for no cash consideration to key
non-officer employees. Each employee receiving a grant of shares may dispose of
15 percent of his/her grant on each annual anniversary date from the date of
grant for the first four years. On the fifth year anniversary, the employee may
dispose of the remaining 40 percent of his/her grant. No shares were granted in
fiscal 1995 and 1994. In fiscal 1995, 1,375 shares were cancelled leaving 1,375
shares reserved for issuance or available for granting as of August 31, 1995.

The Company's 1980 Incentive Career Stock Plan ("1980 Plan") provides for
the issuance of 2,100,000 shares of common stock for no cash consideration to
key employees. Each employee receiving a grant of shares may dispose of 15
percent of his/her grant on each annual anniversary date from the date of grant
for the first four years. On the fifth year anniversary, the employee may
dispose of the remaining 40 percent of his/her grant. No shares were granted and
no shares were cancelled in fiscal 1994. No shares were granted in fiscal 1995
and 3,500 shares were cancelled leaving 6,250 shares reserved for issuance and
available for granting at August 31, 1995.

The Company's 1991 Stock Grant Plan ("1991 Plan") provides for the issuance
to officers and key employees of up to 3,160,000 shares of common stock for no
cash consideration. Shares granted under the

F-10
<PAGE> 39

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

1991 Plan are fully vested no earlier than 24 months from the effective date of
the grant and not later than 36 months. The specific vesting schedule for each
grant is determined at the time of grant. During fiscal 1994, 45,000 shares were
granted and no shares were cancelled. In fiscal 1995, 545,000 shares were
granted and no shares were cancelled leaving 1,580,195 shares reserved for
issuance and available for granting at August 31, 1995.

The fair market value of the common stock at date of grant for the Plans is
recorded as deferred compensation and amortized to expense over the period
during which the restrictions lapse. Deferred compensation is shown as a
deduction from stockholders' equity.

During fiscal 1995, 1994 and 1993, the Company purchased 51,279, 41,638 and
64,173 Parker Drilling shares, respectively, from certain of its employees who
had received stock grants under the 1991 and 1980 Plans. The Company acquired
the shares at the market price (weighted average price was $5.40 per share in
fiscal 1995, $7.31 per share in fiscal 1994 and $5.98 per share in fiscal 1993).
The proceeds were used to pay the employees' tax withholding obligations arising
from the vesting of shares under the Plans.

The 1994 Non-Employee Director Stock Option Plan ("Director Plan") was
approved by shareholders of the Company on December 14, 1994. The Director Plan
provides for the issuance of options to purchase up to 200,000 shares of the
Company's common stock. The option price per share is equal to the fair market
value of a Parker Drilling share on the date of grant. The term of each option
is ten years, and an option first becomes exercisable six months after the date
of grant. Under the Plan, on the first trade day of each calendar year, each
person who is then a non-employee director of the Company will be automatically
granted an option to purchase 5,000 shares of common stock.

The 1994 Executive Stock Option Plan ("Option Plan") was approved by
shareholders of the Company on December 14, 1994. The Option Plan provides for
the granting of a maximum of 2,400,000 shares to key employees and consultants
of the Company and its subsidiaries through the granting of stock options, stock
appreciation rights and restricted and deferred stock awards. The option price
per share may not be less than 50% of the fair market value of a share on the
date the option is granted. The maximum term of a non-qualified option may not
exceed fifteen years and the maximum term of an incentive option is ten years.

Information regarding the Company's stock option plans is summarized below:

<TABLE>
<CAPTION>
1994 OPTION PLAN
----------------------
1994 NON-
DIRECTOR INCENTIVE QUALIFIED
PLAN OPTIONS OPTIONS
-------- --------- ---------
<S> <C> <C> <C>
Shares under option:
Outstanding at September 1, 1994....................... -- -- --
Granted................................................ 15,000 733,000 147,000
Exercised.............................................. -- -- (7,000)
Cancelled.............................................. -- -- --
-------- --------- ---------
Outstanding at August 31, 1995......................... 15,000 733,000 140,000
Average option price per share at August 31, 1995........ $4.56 $4.50 $2.25
Options exercisable at August 31, 1995................... 15,000 733,000 42,000
</TABLE>

F-11
<PAGE> 40

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The following is a summary of common stock reserved for issuance at fiscal
year end:

<TABLE>
<CAPTION>
1995 1994
--------- ---------
<S> <C> <C>
Key employee stock plans...................................... 4,180,820 2,127,945
Stock Bonus Plan.............................................. 186,279 79,867
Warrants(1)................................................... 400,000 400,000
--------- ---------
Total shares reserved for issuance.................. 4,767,099 2,607,812
========= =========
</TABLE>

- ---------------

(1) Warrants for 400,000 shares are exercisable at $3.88 per share, subject to
certain adjustments, no later than October 24, 1995.

NOTE 7 -- EMPLOYEE BENEFIT PLANS

The Parker Drilling Company Stock Bonus Plan ("Plan") was adopted effective
September 1980 for employees of Parker Drilling and its subsidiaries who are
U.S. citizens and who have completed one year of service with the Company. It
was amended in 1983 to qualify as a 401(k) plan under the Internal Revenue Code
which permits a specified percentage of an employee's salary to be voluntarily
contributed on a before-tax basis and to provide for a Company matching feature.
Participants may contribute from one percent to 15 percent of eligible earnings
and direct contributions to one or more of seven investment funds. The Company
presently makes dollar-for-dollar matching contributions up to three percent of
a participant's compensation. The Company's matching contribution is made in
Parker Drilling common stock. The Plan was amended in 1989 to change the vesting
schedule to no percent vesting if a participant has less than five years of
service and 100 percent vesting if a participant has five or more years of
service. Each Plan year, Company contributions can be made, at the discretion of
the Board of Directors, in amounts not exceeding the permissible deductions
under the Internal Revenue Code. The Company issued 113,399 shares to the Plan
in 1995, 123,619 shares in 1994 and 95,177 shares in 1993.

F-12
<PAGE> 41

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 8 -- BUSINESS SEGMENTS

Information regarding the Company's operations by geographic area is as
follows:

<TABLE>
<CAPTION>
1995 1994 1993
-------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Operations by Geographic Area
Revenue:
United States...................................... $ 28,487 $ 30,975 $ 30,936
Other Western Hemisphere........................... 76,115 52,722 31,604
Asia Pacific....................................... 44,911 43,445 22,556
Africa, Middle East and C.I.S...................... 7,858 25,282 15,705
-------- -------- --------
Total revenue.............................. $157,371 $152,424 $100,801
======== ======== ========
Operating income (loss):
United States...................................... $ (7,609) $(30,518) $(11,355)
Other Western Hemisphere........................... (921) (5,937) 792
Asia Pacific....................................... 8,701 6,771 (1,240)
Africa, Middle East and C.I.S...................... (1,668) 831 (577)
-------- -------- --------
Total operating income (loss).............. $ (1,497) $(28,853) $(12,380)
======== ======== ========
Identifiable assets:
United States...................................... $ 71,233 $ 64,337 $121,130
Other Western Hemisphere........................... 83,345 73,688 39,420
Asia Pacific....................................... 49,223 43,456 43,176
Africa, Middle East and C.I.S...................... 13,158 27,867 32,616
======== ======== ========
Total identifiable assets.................. $216,959 $209,348 $236,342
======== ======== ========
</TABLE>

Two customers accounted for approximately 22 percent and 13 percent,
respectively, of total revenue in 1995. Three customers accounted for
approximately 14 percent, 12 percent and 11 percent, respectively, of total
revenue in 1994. Three customers accounted for approximately 22 percent, 14
percent and 10 percent, respectively, of total revenue in 1993. Operating income
(loss) is total revenue less operating expenses including depreciation,
depletion and amortization and an allocation of general corporate expenses based
on rig operating days. Operating income (loss) excludes interest expense,
interest capitalized, non-operating income or expense and income taxes.

NOTE 9 -- COMMITMENTS AND CONTINGENCIES

At August 31, 1995, the Company had letters of credit facilities of
$17,651,000 of which $7,277,000 had been issued.

Certain officers have entered into a Severance Compensation and Consulting
Agreement ("the Agreement") with the Company. The Agreement has an initial ten
year term and provides certain benefits upon a change in control. A change in
control includes certain mergers, sale of all of the Company's assets,
liquidation of the Company or a third party acquiring a greater percentage of
stock than the aggregate ownership of Robert L. Parker, Robert L. Parker Jr. and
Robert L. Parker Trust. After a change in control occurs, if an officer is
terminated other than for cause or resigns for good reason, the Agreement
provides for a payment of three times the annual cash compensation, a one year
consulting agreement at the officer's annual cash compensation, miscellaneous
executive benefits and extended life and health benefits for four years.

A former employee ("Plaintiff") was injured while working for the Company
on a rig owned and operated by another firm ("Defendant") for which he sought
damages against the firm. Pursuant to the

F-13
<PAGE> 42

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

indemnity provision in the contract between the Company and the Defendant, the
Company agreed to defend and indemnify the Defendant. The litigation ultimately
resulted in a settlement in favor of the Plaintiff totalling $6,750,000. Because
certain findings of fact by the jury created a dispute over the obligations of
the Company under the indemnity provision, the Defendant and the Company entered
into litigation to determine liability for funding the settlement. This
ancillary proceeding also resulted in a settlement, with the Defendant agreeing
to pay $1,687,000 and the Company $5,063,000.

The Company has filed suit against its excess insurer claiming
reimbursement of the compensatory portion of the settlement with the Plaintiff.
The Company has also commenced legal proceeding against the counsel retained to
defend the Defendant claiming that the Company was damaged in having to
indemnify the Defendant for the balance of the settlement with the Plaintiff due
to the malpractice/misrepresentation of the counsel. During fiscal 1994, the
Company recorded a $2,562,000 expense related to this litigation.

In addition, the Company is a party to various other lawsuits and claims
arising out of the ordinary course of business. Management, after review and
consultation with legal counsel, considers that any liability resulting from
these matters would not materially affect the results of operations or the
financial position of the Company.

NOTE 10 -- RELATED PARTY TRANSACTIONS

At August 31, 1995, the Company owned an insurance policy on the life of
Mr. R. L. Parker, chairman and a principal stockholder. The Company is the
beneficiary of this policy which was issued pursuant to a Stock Purchase
Agreement ("Agreement") approved by vote of the stockholders at the 1975 Annual
Meeting on December 10, 1975. This Agreement was entered into between the
Company and the Robert L. Parker Trust and provides that upon the death of
Robert L. Parker, the Company would be required, at the option of the Trust, to
purchase from the Trust at a discounted price the amount of Parker Drilling
common stock which could be purchased with the proceeds of the policy of
$7,000,000. On August 3, 1994, the Company and the Trust modified this Agreement
so that the Company will have the option but not the obligation to purchase the
stock at a discounted price with the proceeds or to retain the entire proceeds
upon the death of Robert L. Parker. If action under the agreement had been
required at August 31, 1995, and the Company elected to purchase Parker Drilling
common stock from the Trust, Parker Drilling's outstanding common stock would
have been reduced by approximately three percent.

As a part of the agreement to terminate the option held by the Trust and to
grant the Company a limited option to purchase stock at a discounted price, the
Company has also agreed to pay a premium of $655,019 annually for a split dollar
last-to-die life insurance policy on Robert L. Parker and Mrs. Robert L. Parker.
Upon the deaths of Mr. Parker and Mrs. Parker, the Company will be reimbursed by
the Robert L. Parker Sr. and Catherine M. Parker Family Trust from the proceeds
of the policy for the full amount of premiums paid plus interest at the one-year
treasury bill rate on the premiums paid after fiscal year 1999. Additionally,
Robert L. Parker Jr., Chief Executive Officer of the Company and son of Robert
L. Parker, will receive as a beneficiary of the Trust one-third of the net
proceeds of this policy. The face value of the policy is $13,200,000.

NOTE 11 -- SUPPLEMENTARY INFORMATION

Maintenance and repairs expense for the years ended August 31, 1995, 1994
and 1993 was $14,364,000, $15,548,000 and $10,149,000, respectively.
Advertising, royalties, taxes other than payroll and income taxes, depreciation
and amortization of intangible assets, pre-operating costs and similar deferrals
were each less than one percent of total revenue. At August 31, 1995, accrued
liabilities included $1,178,000 of workers' compensation liabilities and
$2,981,000 of accrued payroll and payroll taxes. At August 31, 1994, accrued
liabilities included $2,236,000 of workers' compensation liabilities and
$2,714,000 of accrued payroll and

F-14
<PAGE> 43

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

payroll taxes. Other long-term liabilities included $1,679,000 and $1,179,000 of
workers' compensation liabilities as of August 31, 1995 and 1994, respectively.

NOTE 12 -- SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

<TABLE>
<CAPTION>
QUARTER
--------------------------------------------------------
FIRST SECOND THIRD FOURTH TOTAL
------- ------- ------- ------- --------
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
Fiscal 1995
Revenue............................... $33,283 $38,738 $43,259 $42,091 $157,371
Gross profit(2)....................... $ 1,558 $ 5,005 $ 5,666 $ 5,439 $ 17,668
Operating income (loss)............... $(3,457) $ (135) $ 1,016 $ 1,079 $ (1,497)
Net income (loss)..................... $(1,093) $ 69 $ 2,050 $ 2,890 $ 3,916
Primary and fully diluted earnings
(loss) per share................... $ (.02) $ .00 $ .04 $ .05 $ .07
</TABLE>

<TABLE>
<CAPTION>
QUARTER
----------------------------------------------------------
FIRST SECOND THIRD FOURTH(1) TOTAL
------- ------- ------- --------- --------
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
Fiscal 1994
Revenue.............................. $40,043 $40,732 $36,679 $ 34,970 $152,424
Gross profit(2)...................... $ 6,044 $ 3,751 $ 1,049 $ (1,665) $ 9,179
Operating income(loss)............... $ 1,994 $(1,163) $(2,936) $ (26,748) $(28,853)
Net income (loss).................... $ 1,608 $ (750) $(2,791) $ (26,873) $(28,806)
Primary and fully diluted earnings
(loss) per share.................. $ .03 $ (.01) $ (.05) $ (.49) $ (.53)(3)
</TABLE>

- ---------------

(1) The fourth quarter of fiscal 1994 includes a $19,718,000 provision for
reduction in carrying value of certain assets and a $2,562,000 charge for
litigation discussed in Notes 2 and 9, respectively.

(2) Gross profit is calculated by excluding general and administrative expense
and provision for reduction in carrying value of certain assets from
operating income (loss), as reported in the consolidated statement of
operations.

(3) As a result of shares issued during the year, earnings (loss) per share for
the year's four quarters, which are based on average shares outstanding
during each quarter, do not equal the annual earnings (loss) per share,
which is based on the average shares outstanding during the year.

F-15
<PAGE> 44

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders
Parker Drilling Company

We have reviewed the consolidated condensed balance sheet of Parker
Drilling Company and subsidiaries as of February 29, 1996, and the related
consolidated condensed statements of operations for the six months periods ended
February 29, 1996 and February 28, 1995 and consolidated condensed statements of
cash flows for the six month periods ended February 29, 1996 and February 28,
1995. These financial statements are the responsibility of the Company's
management.

We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred to
above for them to be in conformity with generally accepted accounting
principles.

We have previously audited, in accordance with generally accepted
standards, the consolidated balance sheet as of August 31, 1995, and the related
consolidated statements of operations, redeemable preferred stock and
stockholders' equity and cash flows for the year then ended (not presented
herein); and in our report, dated October 17, 1995, we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated balance sheet
as of August 31, 1995, is fairly stated in all material respects in relation to
the consolidated balance sheet from which it has been derived.

COOPERS & LYBRAND L.L.P.

Tulsa, Oklahoma
April 12, 1996

F-16
<PAGE> 45

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
(UNAUDITED)

ASSETS

<TABLE>
<CAPTION>
FEBRUARY 29, AUGUST 31,
1996 1995
------------ ----------
<S> <C> <C>
Current assets:
Cash and cash equivalents........................................... $ 14,766 $ 20,752
Other short-term investments........................................ 6,581 1,372
Accounts and notes receivable....................................... 38,994 39,578
Rig materials and supplies.......................................... 11,127 11,532
Other current assets................................................ 4,441 5,146
-------- --------
Total current assets........................................ 75,909 78,380
Property, plant and equipment less accumulated depreciation, depletion
and amortization of $414,814 at February 29, 1996, and $432,360 at
August 31, 1995..................................................... 122,342 122,258
Other noncurrent assets............................................... 24,215 16,321
-------- --------
Total assets................................................ $222,466 $ 216,959
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt................................... $ 289 $ 289
Accounts payable and accrued liabilities............................ 15,616 16,940
Accrued income taxes................................................ 6,550 5,109
-------- --------
Total current liabilities................................... 22,455 22,338
-------- --------
Long-term debt........................................................ 1,473 1,748
-------- --------
Other long-term liabilities........................................... 6,755 5,953
-------- --------
Common stock, $.16 2/3 par value...................................... 9,364 9,287
Capital in excess of par value........................................ 207,095 205,310
Retained earnings (accumulated deficit)............................... (22,153) (24,391)
Other................................................................. (2,523) (3,286)
-------- --------
Total stockholders' equity.................................. 191,783 186,920
-------- --------
Total liabilities and stockholders' equity.................. $222,466 $ 216,959
======== ========
</TABLE>

See accompanying notes to consolidated condensed financial statements.

F-17
<PAGE> 46

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
-----------------------------
FEBRUARY 29, FEBRUARY 28,
1996 1995
------------ ------------
<S> <C> <C>
Revenue:
Drilling contracts................................................ $ 78,280 $ 69,780
Other............................................................. 2,359 2,241
------- -------
Gross operating revenue................................... 80,639 72,021
------- -------
Operating expense:
Drilling.......................................................... 53,987 51,867
Other............................................................. 2,820 2,665
Depreciation, depletion and amortization.......................... 10,712 10,926
General and administrative........................................ 10,628 10,155
------- -------
78,147 75,613
------- -------
Operating income (loss)............................................. 2,492 (3,592)
------- -------
Other income and (expense):
Interest expense.................................................. (53) (35)
Interest income................................................... 699 577
Other income (expense) -- net..................................... 1,875 3,281
------- -------
2,521 3,823
------- -------
Income before income taxes.......................................... 5,013 231
------- -------
Income tax expense.................................................. 2,775 1,255
------- -------
Net income (loss)................................................... 2,238 (1,024)
------- -------
Earnings (loss) per share, primary and fully diluted................ $ .04 $ (.02)
======= =======
Number of common shares used in computing earnings (loss) per share:
Primary........................................................... 55,863,977 54,610,611
Fully diluted..................................................... 55,950,437 54,610,611
</TABLE>

See accompanying notes to consolidated condensed financial statements.

F-18
<PAGE> 47

PARKER DRILLING COMPANY AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(DOLLARS IN THOUSANDS)
(UNAUDITED)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
-----------------------------
FEBRUARY 29, FEBRUARY 28,
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss)................................................. $ 2,238 $ (1,024)
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
Depreciation, depletion and amortization....................... 10,712 10,926
Expenses not requiring cash.................................... 917 (180)
Change in operating assets and liabilities..................... 847 720
Other -- net................................................... (1,926) (1,552)
-------- -------
Net cash provided by operating activities................. 12,788 8,890
-------- -------
Cash flows from investing activities:
Capital expenditures.............................................. (17,850) (6,174)
Proceeds from the sale of equipment............................... 4,234 5,427
Decrease (increase) in short-term investments..................... (5,209) 2,781
Other -- net...................................................... (1,140) 121
-------- -------
Net cash provided (used) by investing activities.......... (19,965) 2,155
-------- -------
Cash flows from financing activities:
Proceeds from exercise of stock warrants.......................... 1,552 --
Other............................................................. (361) (106)
-------- -------
Net cash provided (used) by financing activities.......... 1,191 (106)
-------- -------
Net change in cash and cash equivalents............................. (5,986) 10,939
Cash and cash equivalents at beginning of period.................... 20,752 10,660
-------- -------
Cash and cash equivalents at end of period.......................... $ 14,766 $ 21,599
======== =======
Supplemental disclosure:
Interest paid..................................................... $ 109 $ 2
Taxes paid........................................................ $ 1,334 $ 1,641
</TABLE>

Supplemental noncash financing activity:

In November 1994, the Company acquired a limited partner's ownership
interest in two consolidated partnerships in exchange for a promissory note in
the amount of $1,850,000.

See accompanying notes to consolidated condensed financial statements.

F-19
<PAGE> 48

PARKER DRILLING COMPANY AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

1. In the opinion of the Company, the accompanying unaudited consolidated
condensed financial statements reflect all adjustments (of a normally
recurring nature) which are necessary for a fair presentation of (1) the
financial position as of February 29, 1996 and August 31, 1995, (2) the
results of operations for the six months ended February 29, 1996 and February
28, 1995, and (3) cash flows for the six months ended February 29, 1996 and
February 28, 1995. Results for the six months ended February 29, 1996, are
not necessarily indicative of the results which will be realized for the year
ending August 31, 1996. The year-end consolidated condensed balance sheet
data was derived from audited financial statements, but does not include all
disclosures required by generally accepted accounting principles. The
financial statements should be read in conjunction with the Company's Form
10-K for the year ended August 31, 1995.

2. Earnings per common share are based on the weighted average number of common
shares and common share equivalents outstanding during the period. Common
shares granted under the 1969 Key Employee Stock Grant Plan, 1980 Incentive
Career Stock Plan and the 1991 Stock Grant Plan are issued and outstanding
and are only considered in the computation of weighted average shares
outstanding when their effect on earnings per share is dilutive.

3. In March 1995, Statement of Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to
be Disposed of" was issued. The statement establishes accounting standards
for the impairment of long-lived assets, such as the Company's drilling,
transportation and other equipment and will be effective for the Company
beginning with the year ending August 31, 1997. The Company does not believe
the new standard will have a material effect on the Company's financial
position or results of operations.

In October 1995, Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" was issued. The statement requires
the computation of compensation for grants of stock, stock options and other
equity instruments issued to employees based on fair value. The compensation
calculated is to be either recorded as an expense in the financial statements
or, alternatively, disclosed. The Company anticipates it will elect the
disclosure method of complying with the new standard. Under the provisions of
the new statement, it is anticipated pro forma net income to be disclosed will
be lower than net income reported in the financial statements.

F-20
<PAGE> 49

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OF THE
UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH
THE PERSON MAKING SUCH OFFER IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH SOLICITATION.
---------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information..................... 2
Incorporation of Certain Documents By
Reference............................... 2
Prospectus Summary........................ 3
Summary of Consolidated Financial Data.... 6
Risk Factors.............................. 7
Use of Proceeds........................... 9
Price Range of Common Stock and
Dividends............................... 9
Selected Consolidated Financial Data...... 10
Management's Discussion and Analysis of
Financial Condition and Results of
Operations.............................. 11
Business.................................. 15
Management................................ 21
Description of Capital Stock.............. 23
Underwriting.............................. 25
Forward-Looking Statements................ 26
Legal Matters............................. 26
Independent Accountants................... 26
Index to Consolidated Financial
Statements.............................. F-1
</TABLE>

UNTIL (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK OFFERED HEREBY, WHETHER OR
NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER
A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

7,000,000 SHARES

[LOGO OF COMPANY APPEARS HERE]

PARKER
DRILLING
COMPANY
COMMON STOCK
PROSPECTUS
JEFFERIES & COMPANY, INC.
, 1996
<PAGE> 50

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

All amounts, which are payable by the Registrant, are estimated except for
the SEC and NASD fees.

<TABLE>
<S> <C>
SEC registration fee..................................................... $20,472
NASD filing fee.......................................................... 6,437
New York Stock Exchange additional listing fee........................... *
Accounting fees and expenses............................................. *
Legal fees and expenses.................................................. *
Blue Sky fees and expenses (including legal fees)........................ *
Printing and shipping costs.............................................. *
Miscellaneous............................................................ *
-------
Total.......................................................... $
=======
</TABLE>

- ---------------

* To be supplied by amendment.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Registrant's By-Laws provide that each person who was or is made a
party to, or is involved in, any action, suit or proceeding by reason of the
fact that he or she was a director or officer of the Registrant (or was serving
at the request of the Registrant as a director, officer, employee or agent for
another entity) will be indemnified and held harmless by the Registrant, to the
full extent authorized by the Delaware General Corporation Law.

Under Section 145 of the Delaware General Corporation Law, a corporation
may indemnify a director, officer, employee or agent of the corporation against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him or her if he or she acted in
good faith and in a manner he or she reasonably believed to be in or not opposed
to the best interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct was
unlawful. In the case of an action brought by or in the right of a corporation,
the corporation may indemnify a director, officer, employee or agent of the
corporation against expenses (including attorneys' fees) actually and reasonably
incurred by him or her if he or she acted in good faith and in a manner he or
she reasonably believed to be in the best interests of the corporation, except
that no indemnification shall be made in respect of any claim, issue or matter
as to which such person shall have been adjudged to be liable to the corporation
unless a court finds that, in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses as the
court shall deem proper.

The Registrant's Certificate of Incorporation provides that to the fullest
extent permitted by Delaware General Corporation Law as the same exists or may
hereafter be amended, a director of the Registrant shall not be liable to the
Registrant or its stockholders for monetary damages for breach of fiduciary duty
as a director. The Delaware General Corporation Law permits Delaware
corporations to include in their certificates of incorporation a provision
eliminating or limiting director liability for monetary damages arising from
breaches of their fiduciary duty. The only limitations imposed under the statute
are that the provision may not eliminate or limit a director's liability (i) for
breaches of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or involving
intentional misconduct or known violations of law, (iii) for the payment of
unlawful dividends or unlawful stock purchases or redemptions, or (iv) for
transactions in which the director received an improper personal benefit.

The Registrant is insured against liabilities which it may incur by reason
of its indemnification of officers and directors in accordance with its By-Laws.
In addition, directors and officers are insured, at the Registrant's

II-1
<PAGE> 51

expense, against certain liabilities which might arise out of their employment
and are not subject to indemnification under the By-Laws.

The form of Underwriting Agreement included as Exhibit 1.1 provides for
indemnification of the Registrant and certain controlling persons under certain
circumstances, including liabilities under the Securities Act of 1933.

The foregoing summaries are necessarily subject to the complete text of the
statute, Certificate of Incorporation, By-Laws and agreements referred to above
and are qualified in their entirety by reference thereto.

ITEM 16. EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
1.1** -- Form of Underwriting Agreement.
4.2** -- Form of stock certificate for Common Stock, par value $.16 2/3 per
share.
5.1** -- Opinion of Conner & Winters, A Professional Corporation, as to
legality of Common Stock.
15.1* -- Letter re: Unaudited interim financial information.
23.1* -- Consent of Independent Accountants
23.2** -- Consent of Conner & Winters, A Professional Corporation (included in
Exhibit 5.1).
24.1* -- Power of Attorney (included on the signature page to this
Registration Statement).
</TABLE>

- ---------------
* Filed herewith.

** To be filed by amendment.

ITEM 17. UNDERTAKINGS.

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(h) Insofar as indemnification of liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the provisions referred to in Item 15 of this
Registration Statement, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

(i) The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as a
part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or

II-2
<PAGE> 52

(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

II-3
<PAGE> 53

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duty
authorized, in the City of Tulsa, State of Oklahoma, on May 30, 1996.

PARKER DRILLING COMPANY

By /s/ ROBERT L. PARKER JR.
---------------------------------------
Robert L. Parker Jr.
President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints James J. Davis and I.E. Hendrix, and each
of them, his true and lawful attorneys-in-fact and agents with full power of
substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement and any subsequent registration statement filed
by the Registrant pursuant to Rule 462(b) of the Securities Act of 1933, which
relates to this Registration Statement, and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agents, or his or their substitutes, may lawfully
do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- ---------------------------- -----------------
<S> <C> <C>
/s/ ROBERT L. PARKER Chairman of the Board and May 30, 1996
- --------------------------------------------- Director
Robert L. Parker

/s/ ROBERT L. PARKER JR. President and Chief May 30, 1996
- --------------------------------------------- Executive Officer and
Robert L. Parker Jr. Director (Principal
Executive Officer)

/s/ JAMES J. DAVIS Vice President of Finance May 30, 1996
- --------------------------------------------- and Chief Financial
James J. Davis Officer (Principal
Financial Officer)

/s/ RANDY L. ELLIS Corporate Controller May 30, 1996
- --------------------------------------------- (Principal Accounting
Randy L. Ellis Officer)

Executive Vice President and
- --------------------------------------------- Chief Operating Officer
James W. Linn and Director
</TABLE>

II-4
<PAGE> 54

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ EARNEST F. GLOYNA Director May 30, 1996
- -------------------------------------------
Earnest F. Gloyna

/s/ DAVID L. FIST Director May 30, 1996
- -------------------------------------------
David L. Fist

/s/ R. RUDOLPH REINFRANK Director May 30, 1996
- -------------------------------------------
R. Rudolph Reinfrank
</TABLE>

II-5
<PAGE> 55

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ---------- -----------
<S> <C>
1.1** -- Form of Underwriting Agreement.
4.2** -- Form of stock certificate for Common Stock, par value $.16 2/3 per
share.
5.1** -- Opinion of Conner & Winters, A Professional Corporation, as to
legality of Common Stock.
15.1* -- Letter re: unaudited interim financial information
23.1* -- Consent of Independent Accountants
23.2** -- Consent of Conner & Winters, A Professional Corporation (included
in Exhibit 5.1).
24.1* -- Power of Attorney (included on the signature page to this
Registration Statement).
</TABLE>

- ---------------
* Filed herewith.

** To be filed by amendment.

<PAGE> 1

EXHIBIT 15.1

May 30, 1996

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 10549

Re: Parker Drilling Company
Registration on Form S-3

We are aware that our reports dated January 11, 1996 and April 12, 1996, on
our reviews of the interim financial information of Parker Drilling Company for
the periods ended November 30, 1995 and February 29, 1996, and included in the
Company's quarterly reports on Form 10-Q are incorporated by reference or
included in the Company's registration statement on Form S-3 (File No. ).
Pursuant to Rule 436(c) under the Securities Act of 1933, this report should not
be considered a part of the registration statement prepared or certified by us
within the meaning of Section 7 and 11 of that Act.

COOPERS & LYBRAND L.L.P.

<PAGE> 1

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the inclusion in and incorporation by reference in the
registration statement of Parker Drilling Company on Form S-3 (File
No. )of our report dated October 17, 1995, on our audits of the
consolidated financial statements and financial statement schedules of Parker
Drilling Company and subsidiaries as of August 31, 1995 and 1994, and for the
years ended August 31, 1995, 1994 and 1993.

COOPERS & LYBRAND L.L.P.

Tulsa, Oklahoma
May 30, 1996