UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period Fromtransition period from __________ to __________

Commission File Number 001-2960Number: 001-02960

(Exact name of registrant as specified in its charter)

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”,filer,” “accelerated filer”, “smallfiler,” “smaller reporting company”company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 

INDEX TO ANNUAL REPORT ON FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 20172018

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. We also may provide oral or written forward-looking informationstatements in other materials we release to the public. Words such as “will”, “may”, “could”, “would”, “anticipates”, “believes”, “estimates”, “expects”, “plans”, “intends”,“will,” “may,” “could,” “would,” “should,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” and similar expressions are intended to identify these forward-looking statements but are not the exclusive means of identifying them. These forward-looking statements reflect the current views of our management; however, various risks, uncertainties, contingencies and other factors, some of which are beyond our control, are difficult to predict and could cause our actual results, performance, or achievements to differ materially from those expressed in, or implied by, these statements, including the success or failure of our efforts to implement our business strategy. statements.

We assume no obligation to update, amend, or clarify publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities laws. In light of these risks, uncertainties, and assumptions, the forward-looking events discussed in this Annual Report on Form 10-K might not occur.

For further information regarding these and other factors, risks, and uncertainties affecting us, we refer you to the risk factors set forth in Item 1A "Risk Factors" of this Annual Report on Form 10-K. 

Newpark Resources, Inc. was organized in 1932 as a Nevada corporation. In 1991, we changed our state of incorporation to Delaware. We are a geographically diversified supplier providing products, rentals, and services primarily to the oil and natural gas exploration and production (“E&P”) industry. We operate our business through two reportable segments: Fluids Systems and Mats and Integrated Services. Our Fluids Systems segment provides drillingcustomized fluids products and technical servicessolutions to E&P customers in theglobally, operating through four geographic regions: North America, Europe, the Middle East and Africa (“EMEA”), Latin America, and Asia Pacific regions.Pacific. Our Mats and Integrated Services segment provides composite mat rentals utilized for temporary worksite access, along with site construction and related site services to customers in various markets including oil and gas exploration and production,E&P, electrical transmission & distribution, pipeline, solar, petrochemical, and construction industries across the U.S., CanadaNorth America and Europe. We also sell composite mats to customers outside ofaround the U.S. and to domestic customers outside of the E&P market.world.

Our principal executive offices are located at 9320 Lakeside Blvd.,Boulevard, Suite 100, The Woodlands, Texas 77381. Our telephone number is (281) 362-6800. You can find more information about us aton our website located at www.newpark.com. Our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K and any amendments to those reports are available free of charge through our website. These reports are available as soon as reasonably practicable after we electronically file these materials with, or furnish them to, the Securities and Exchange Commission (“SEC”). Our Code of Ethics, our Corporate Governance Guidelines, our Audit Committee Charter, our Compensation Committee Charter and our Nominating and Corporate Governance Committee Charter are also posted to the corporate governance section of our website. We make our website content available for informational purposes only. It should not be relied upon for investment purposes, nor is it incorporated by reference in this Form 10-K. Information filed with the SEC may be read or copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C., 20549. Information on operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including us.

When referring to “Newpark” and using phrases such asNewpark Resources, Inc. (“Newpark,” the “Company”“Company,” “we,” “our,” or “us”), “we”, “us” and “our”, ourthe intent is to refer to Newpark Resources, Inc. and its subsidiaries as a whole or on a segment basis, depending on the context in which the statements are made. The reference to a “Note” herein refers to the accompanying Notes to Consolidated Financial Statements contained in Item 8 “Financial Statements and Supplementary Data.”

Historically, several factors have driven demand for our products and services, including the supply, demand and pricing ofOur operating results depend, to a large extent, on oil and natural gas commodities, which drive E&P drilling and development activity. Demand for most of our Fluids Systems’ products and services is also driven, in part, by the level, type, depth and complexity of oil and gas drilling. Historically, drilling activity levels in North America have been volatile, primarily driven by the pricemarkets we serve, and particularly for the Fluids Systems segment, the nature of the drilling operations (including the depth and whether the wells are drilled vertically or horizontally), which governs the revenue potential of each well. Drilling activity levels, in turn, depend on a variety of factors, including oil and natural gas.gas commodity pricing, inventory levels, product demand, and regulatory restrictions. Oil and natural gas prices and activity are cyclical and volatile and this market volatility has a significant impact on our operating results. Beginning in the fourth quarter oflate 2014 and continuing through early 2016, the price of oil declined dramatically from the price levels in previousprior years. As a result, E&P drilling activity levels significantly declined in North America and many global markets over this period. While oilOil prices and drilling activity have since improved from the lows reached in early 2016, both oil price and activity levelsbut remain significantly lower than pre-downturn levels. Thelevels and continue to be volatile. While our revenue potential is driven by a number of factors including those described above, rig count data remains the most widely accepted measureindicator of activity for our North American operations is thedrilling activity. The average Baker Hughes North America Rotary Rig Count. The average North America rig countCount was 1,223 in 2018, compared to 1,083 in 2017, compared toand 639 in 2016, 1,170 in 2015, and 2,241 in 2014.2016.

The declining E&P drilling activity levels in 2015 and 2016 reduced the demand for our services, negatively impacted customer pricing, and resulted in elevated costs associated with workforce reductions, all of which negatively impacted our profitability. Further, due to the fact that our business contains substantial levels of fixed costs, including significant facility and personnel expenses, North American operating margins in both operating segments were negatively impacted by the lower customer demand during this period.

Outside of North America, drilling activity is generally more stable as drilling activity in many countries is based upon longer termon longer-term economic projections and multiple yearmulti-year drilling programs, which tendtends to reduce the impact of short-term changes in commodity prices on overall drilling activity. WhileAlthough drilling activity levels in certain of our international markets (including Brazil and Australia) hashave declined in recent years, as a whole, our international activities have remained relatively stable. This stability isstable, primarily driven by new contract awards, which include geographicalkey contracts with national oil companies. International expansion, into new markets as well as market share gains in existing markets.including the penetration of international oil companies ("IOCs") and national oil companies ("NOCs"), is a key element of our Fluids Systems strategy.

In addition to our ongoing activity in the E&P industry,international expansion efforts, we are also expanding our Mats and Integrated Services segment is continuing to expand into other industriespresence in North America, including electrical transmission & distributioncapitalizing on our capabilities, infrastructure, and pipeline construction and maintenance. The demand forstrong market position in the North American land drilling fluids markets to expand our composite matting systems from customers in these industries, is driven in part, bydrilling fluids presence within the leveldeepwater Gulf of construction and maintenance activity associated with the electrical transmission & distribution grid,Mexico, as well as the oilour presence in adjacent product offerings, including completion fluids and natural gas pipeline infrastructure within the U.S.stimulation chemicals.

Our Fluids Systems businesssegment provides drilling and completion fluids products and technical services to customers in the North America, EMEA, Latin America, and Asia Pacific regions. We offer customized solutions for highly technical drilling projects involving complex subsurface conditions such as horizontal, directional, geologically deep, or drilling in deep water. These projects require increased monitoring and critical engineering support of the fluids system during the drilling process. In addition, our Fluids Systems offering is expanding into adjacent areas to drilling fluids,of chemistry, including completion and stimulation chemistry,chemicals, which are typically utilized extensively by customers followingE&P operators in the drilling process.U.S. to stimulate hydrocarbon production.

We also have industrial mineral grinding operations for barite, a critical raw material in drilling fluids products, which serve to support our activityactivities in the North American drilling fluids market. We grind barite and other industrial minerals at four facilities, including locations in Texas, Louisiana, and Tennessee. We use the resulting products in our drilling fluids business and also sell them to third party users, including other drilling fluids companies. We also sell a variety of other minerals, principally to third-party industrial (non-oil and natural gas) markets.

Mats and Integrated Services 

Our Mats and Integrated Services segment provides composite mat rentals utilized for temporary worksite access, along with site construction and related site services to customers in various markets including oil and gas exploration and production (“E&P”),&P, electrical transmission & distribution, pipeline, solar, petrochemical, and construction industries across North America and Europe. We also sell composite mats to customers outside ofaround the U.S. and to domestic customers outside of the E&P market. Following our efforts in recent years to diversify our customer base,world. The Mats and Integrated Services segment revenues from non-E&P markets represented approximately two-thirdshalf of our segment revenues in 2017.2018.

In November 2017, we acquired certain assets and assumed certain liabilities of Well Service Group, Inc. and Utility Access Solutions, Inc. (together, “WSG”). Since 2012, WSG hashad been a strategic logistics and installation service provider for our Mats and Integrated Service segment, offering a variety of complementary services to our composite matting systems, including access road construction, site planning and preparation, environmental protection, fluids and spill storage/containment, erosion control, and site restoration services. The completion of the WSG acquisition expanded our service offering as well as our U.S. geographic footprint across the Northeast, Midwest, Rockies, and West Texas regions of the U.S.

At January 31, 2018,2019, we employed approximately 2,4002,500 full and part-time personnel, none of which are represented by unions. We consider our relations with our employees to be satisfactory.

We seek to comply with all applicable legal requirements concerning environmental matters. Our business is affected by governmental regulations relating to the oil and natural gas industry in general, as well as environmental, health, and safety regulations that have specific application to our business. Our activities are impacted by various federal and state regulatory agencies, and provincial pollution control, health, and safety programs that are administered and enforced by regulatory agencies.

Additionally, our business exposes us to environmental risks. We have implemented various procedures designed to ensure compliance with applicable regulations and reduce the risk of damage or loss. These include specified handling procedures and guidelines for waste, ongoing employee training, and monitoring, andas well as maintaining insurance coverage.

We also employ a corporate-wide web-based health, safety, and environmental management system (“HSEMS”), which is ISO 14001:2004 compliant.. The HSEMS is designed to capture information related to the planning, decision-making, and general operations of environmental regulatory activities within our operations. We also use the HSEMS to capture the information generated by regularly scheduled independent audits that are doneperformed to validate the findings of our internal monitoring and auditing procedures.

The following summarizes the most significant risk factors to our business. In addition to these risks, we are subject to a variety of risks that affect many other companies generally, as well as other risks and uncertainties that are not known to us as of the date of this Annual Report. Our success will depend, in part, on our ability to anticipate and effectively manage these and other risks. Any of these risk factors, either individually or in combination, could have significanta material adverse impacts toeffect on our results of operations andor financial condition, or prevent us from meeting our profitability or growth objectives. If you hold our securities or are considering an investment in our securities, you should carefully consider the following risks, together with the other information contained in this Annual Report.

We derive a significant portion of our revenues from customers in the worldwide oil and natural gas industry; therefore, our risk factors include those factors that impact the demand for oil and natural gas. Spending by our customers for exploration, development, and production of oil and natural gas is based on a number of factors, including expectations of future hydrocarbon demand, energy prices, the risks associated with developing reserves, our customers' ability to finance exploration and development of reserves, regulatory developments, and the future value of the reserves. Reductions in customer spending levels adversely affect the demand for our products and services, and consequently, our revenue and operating results; and the presence of these market conditions negatively affects our revenuerevenues and operating results. The key risk factors that we believe influence the worldwide oil and natural gas markets are discussed below.

Demand for oil and natural gas, as well as the demand for our products and services, is highly correlated with global economic growth and in particular by the economic growth of countries such as the U.S., India, China, and developing countries in Asia and the Middle East. Weakness in global economic activity could reduce demand for oil and natural gas and result in lower oil and natural gas prices. In addition, demand for oil and natural gas could be impacted by environmental regulation,regulations, including cap and trade legislation, regulation of hydraulic fracturing, and carbon taxes. Weakness or deterioration of the global economy could reduce our customers’ spending levels and could reduce our revenuerevenues and operating results.

The ability to produceSupply of oil and natural gas can be affected by the availability of quality drilling prospects, exploration success, and the number and productivity of new wells drilled and completed, as well as the rate of production and resulting depletion of existing wells. Productive capacity in excess of demand is also an important factor influencing energy prices and spending by oil and natural gas exploration companies. Oil and natural gas storage inventory levels are indicators of the relative balance between supply and demand. In recent years, advancements in drilling and completion methods and technologies have contributed to a significant increase in oil production, particularly in the U.S. market. Supply can also be impacted by the degree to which individual Organization of Petroleum Exporting Countries (“OPEC”) nations and other large oil and natural gas producing countries are willing and able to control production and exports of hydrocarbons, to decrease or increase supply, and to support their targeted oil price or meet market share objectives. Any of these factors could affect the supply of oil and natural gas and could have a material effect on our results of operations.

Volatility in oil and natural gas prices can also impact our customers’ activity levels and spending for our products and services. The level of energy prices is important to the cash flow for our customers and their ability to fund exploration and development activities. Compared to 2011 to 2014 levels, oil prices have declined significantly due in large part to increasing supplies, weakening demand growth and the decision by OPEC countries to maintain production levels throughout 2015 and most of 2016. While OPEC production limits were put in place in late 2016 and maintained throughout 2017, expectationsExpectations about future commodity prices and price volatility are important for determining future spending levels. Our customers also take into account the volatility of energy prices and other risk factors by requiring higher returns for individual projects if there is higher perceived risk.

Our customers’ access to capital is dependent on their ability to access the funds necessary to develop oil and natural gas prospects. LimitedIn recent years, limited access to external sources of funding has, and may continue to causeat times, caused customers to reduce their capital spending plans. In addition, a reduction of cash flow to our customers resulting from declines in commodity prices or the lack of available debt or equity financing may impact the ability of our customers to pay amounts owed to us.

In 2017,2018, approximately 45%44% of our consolidated revenues were derived from our 20 largest customers, although no customer accounted for more than 10% of our consolidated revenues. While we are not dependent on any one customer or group of customers, the loss of one or more of our significant customers could have an adverse effect on our results of operations and cash flows. In addition, approximately 62%66% of our consolidated revenues were derived from our U.S. operations.

Beginning in the fourth quarter oflate 2014 and continuing through early 2016, the price of oil declined dramatically from the price levels in previousprior years. Following this decline, North American drilling activity decreased significantly, which reduced the demand for our services and negatively impacted customer pricing in our North American operations, relative to pre-downturn levels. While oilOil prices and drilling activity have since improved from the lows reached in early 2016, but remain lower than pre-downturn levels and continue to be volatile, and there are no assurances that the price for oil or activity levels will not experience a significant decline again in the future. Due in part to these changes, our quarterly and annual operating results have fluctuated significantly and may continue to fluctuate in future periods. Because our business has substantial fixed costs, including significant facility and personnel expenses, downtime or low productivity due to reduced demand cancould have a significantmaterial adverse impacteffect on our profitability.business, financial condition, and results of operations.

In addition, several North African markets in which we operate, including Tunisia, Egypt, Libya, and Algeria have experienced social and political unrest in past years, which, when they occur, negatively impact our operating results and can include the temporary suspension of our operations. More recently

Our failure to attract, retain, and develop qualified leaders and key employees at our corporate, divisional, or regional headquarters could have a material adverse effect on our business. In addition, all of our businesses are highly dependent on our ability to attract and retain highly-skilled engineers, technical sales personnel, and service personnel. In recent years, the labor market in Brazil, the ongoing widely-publicized corruption investigationU.S. has continued to disrupt Petrobras’ operations,tighten, with national unemployment levels reaching the lowest level experienced in decades. Consequently, the market for qualified employees has become extremely competitive. If we cannot attract and retain qualified personnel, our ability to compete effectively and grow our business will be severely limited. Also, a significant increase in wages paid by competing employers could result in a reduction in our skilled labor force or an increase in our operating costs.

Barite is a naturally occurring mineral that constitutes a significant portion of our drilling fluids systems. We currently secure the majority of our barite ore from foreign sources, primarily China and India. The availability and cost of barite ore is dependent on factors beyond our control, including transportation, political priorities, U.S. tariffs, and government imposed export fees in the exporting countries, as well as the impact of weather and natural disasters. The future supply of barite ore from existing sources could be inadequate to meet the market demand, particularly during periods of increasing world-wide demand, which could negatively impactultimately restrict industry activity or our operating resultsability to meet our customers' needs.

Our mats business is highly dependent on the availability of high-density polyethylene (“HDPE”), which is the primary raw material used in Brazil.the manufacture of our composite mats. The cost of HDPE can vary significantly based on the energy costs of the producers of HDPE, demand for this material, and the capacity/operations of the plants used to make HDPE. Should the cost of HDPE increase, we may not be able to increase our customer pricing to cover our costs, which could result in a reduction in future profitability.

We employuse borrowed funds as an integral part of our long-term capital structure and our future success is dependent upon continued access to borrowed funds to support our operations. The availability of borrowed funds on reasonable terms is dependent on the condition of credit markets and financial institutions from which these funds are obtained. Adverse events in the financial markets may significantly reduce the availability of funds, which may have an adverse effect on our cost of borrowings and our ability to fund our business strategy. Our ability to meet our debt service requirements and the continued availability of funds under our existing or future loan agreements is dependent upon our ability to generate operating income and remain in compliance with the covenants in our debt agreements. This, in turn, is subject to the volatile nature of the oil and natural gas industry, and to competitive, economic, financial, and other factors that are beyond our control.

We fund our ongoing operational needs through a $150$150.0 million asset-based revolving credit facility (the “Amended ABL(as amended, the “ABL Facility”). Borrowing availability under the Amended ABL Facility is calculated based on eligible accounts receivable, inventory, and, subject to satisfaction of certain financial covenants as described below, composite mats included in the rental fleet, net of reserves and limits on such assets included in the borrowing base calculation. To the extent pledged by us, the borrowing base calculation shall also includeincludes the amount of eligible pledged cash. The lender may establish reserves, in part based on appraisals of the asset base, and other limits at its discretion which could reduce the amounts otherwise available under the Amended ABL Facility. Availability associated with eligible rental mats willis also be subject to maintaining a minimum consolidated fixed charge coverage ratio and a minimum level of operating income for the Mats and Integrated Services segment. The availability under the

We are subject to compliance with a fixed charge coverage ratio covenant if our borrowing availability falls below $22.5 million. If we are unable to make required payments under the Amended ABL Facility or other indebtedness of more than $25.0 million, or if we fail to comply with the various covenants and other requirements of the Amended ABL Facility, we would be in default thereunder, which would permit the holders of the indebtedness to accelerate the maturity thereof, unless we are able to obtain, on a timely basis, a necessary waiver or amendment. Any waiver or amendment may require us to revise the terms of our agreementsagreement which could increase the cost of our borrowings, require the payment of additional fees, and adversely impact the results of our operations. Upon the occurrence of any event of default that is not waived, the lenders could elect to exercise any of their available remedies, which include the right to not lend any additional amounts or, in the event we have outstanding indebtedness under the Amended ABL Facility, to declare any outstanding indebtedness, together with any accrued interest and other fees, to be immediately due and payable. If we are unable to repay the outstanding indebtedness, if any, under the Amended ABL Facility when due, the lenders would be permitted to proceed against their collateral. In the event any outstanding indebtedness in excess of $25.0 million is accelerated, this could also cause an event of default under our 2021 Convertible Notes. The acceleration of any of our indebtedness and the election to exercise any such remedies could have a material adverse effect on our business and financial condition.

We are exposed to significant health, safety, and environmental risks. Our operations are subject to hazards present in the oil and natural gas industry, such as fire, explosion,fires, explosions, blowouts, oil spills, and leaks or spills of hazardous materials (both onshore and offshore). These incidents as well as accidents or problems in normal operations can cause personal injury or death and damage to property or the environment. Our customers’ operations can also be interrupted and it is possible that such incidents can interrupt our ongoing operations and the ability to provide our services. From time to time, customers seek recovery for damage to their equipment or property that occurred during the course of our service obligations. Damage to our customers’ property and any related spills of hazardous materials could be extensive if a major problem occurred. We purchaseoccurs.

Generally, we rely on contractual indemnities, releases, limitations on liability with our customers, and insurance which may provide coverage for incidentsto protect us from potential liability related to such as those described above, however, the policiesevents. However, our insurance and contractual indemnification may not providebe sufficient or effective to protect us under all circumstances or against all risks. In addition, our customers’ changing views on risk allocation together with deteriorating market conditions could force us to accept greater risks to obtain new business, retain renewing business or could result in us losing business if we are not prepared to take such risks. Moreover, we may not be able to maintain insurance at levels of risk coverage or a sufficient amountpolicy limits that we deem adequate. Any damages caused by our services or products that are not covered by insurance or contractual indemnification, or are in excess of coverage for all typespolicy limits or subject to substantial deductibles, could adversely affect our financial condition, results of damage claims that could be asserted against us.operations, and cash flows. See the section entitled “Risks Related to the Inherent Limitations of Insurance Coverage” below for additional information.

Any of the factors above could have an adverse effect on our business, financial condition, or results of operations.

We face competition in the Fluids Systems business from larger companies, including Halliburton, Schlumberger, and Schlumberger,Baker Hughes, a GE Company, which compete vigorously on fluids performance and/or price. In addition, these companies have broad product and service offerings in addition to their drilling and completion fluids. At times, these larger companies attempt to compete by offering discounts to customers to use multiple products and services, from our competitors, some of which we do not offer. We also have smaller regional competitors competing with us mainly on price and local relationships. Our competition in the Mats and Integrated Services business is fragmented, with many competitors providing various forms of matworksite access products and services. More recently, several competitors have begun marketing composite products to compete with our DURA-BASE mat system. While we believe the design and manufacture of our mat products provide a differentiated value to our customers, many of our competitors seek to compete on pricing. SomeIn addition, some of the early patents we received related to our DURA-BASE mat system will expire in 2020 and competitors may begin offering mats that include features described in those patents. We have filed legal actions against competitors in the U.S. to enforce our patents, and have filed for additional patents, but there is no assurance that these actionspatents will be successfulgranted or that competitors will not be able to offer matting products that are substantially similar to the DURA-BASE mat system.

As a key component of our long-term strategy into diversify our revenue streams generated from both operating segments, we seek to continue to expand our product and service offerings and enter new customer markets with our existing products. As with any market expansion effort, new customer and product markets require additional capital investment and include inherent uncertainties regarding customer expectations, industry-specific regulatory requirements, product performance, and customer-specific risk profiles. In addition, we likely will not have the same level of operational experience with respect to the new customer and product markets as will our competitors. As such, new market entry is subject to a number of risks and uncertainties, which could have an adverse effect on our business, financial condition, or results of operations.

We are responsible for complying with numerous federal, state, local, and foreign laws, regulations and policies that govern environmental protection, zoning and other matters applicable to our current and past business activities, including the activities of our former subsidiaries. Failure to remain compliant with these laws, regulations and policies may result in, among other things, fines, penalties, costs of cleanup of contaminated sites and site closure obligations, or other expenditures. We could be exposed to strict, joint and several liability for cleanup costs, natural resource damages and other damages as a result of our conduct that was lawful at the time it occurred or the conduct of, or conditions caused by, prior operators or other third parties. Further, any changes in the current legal and regulatory environment could impact industry activity and the demands for our products and services, the scope of products and services that we provide, or our cost structure required to provide our products and services, or the costs incurred by our customers.

Many of the markets for our products and services are dependent on the continued exploration for and production of fossil fuels (predominantly oil and natural gas). ClimateIn recent years, the topic of climate change is receivinghas received increased attention worldwide. Many scientists, legislators and others attribute climate change to increased levels of greenhouse gases, including carbon dioxide attributed to the use of fossil fuels, which has led to significant legislative and regulatory efforts to limit greenhouse gas emissions. The Environmental Protection Agency (the “EPA”) and other domestic and foreign regulatory agencies have adopted regulations that potentially limit greenhouse gas emissions and impose reporting obligations on large greenhouse gas emission sources. In addition, the EPA has adopted rules that could require the reduction of certain air emissions during exploration and production of oil and natural gas. To the extent that laws and regulations enacted as part of climate change legislation increase the costs of drilling for or

Hydraulic fracturing is a common practice used by E&P operators to stimulate production of hydrocarbons, particularly from shale oil and natural gas formations in the United States.U.S. The process of hydraulic fracturing, which involves the injection of sand (or other forms of proppants) laden fluids into oil and natural gas bearing zones, has come under increasingincreased scrutiny from a variety of regulatory agencies, including the EPA and various state authorities. Several states have adopted regulations requiring operators to identify the chemicals used in fracturing operations, others have adopted moratoriums on the use of fracturing, and the State of New York has banned the practice altogether. In addition, concerns have been raised about whether injection of waste associated with hydraulic fracturing operations, or from the fracturing operations themselves, may cause or increase the impact of earthquakes. Studies are in process regarding the correlation between hydraulic fracturing and earthquakes. Although we do not provide hydraulic fracturing services, we have begun to offer stimulation fluidschemicals used in the hydraulic fracturing process. Regulations which have the effect of limiting the use or significantly increasing the costs of hydraulic fracturing could have a significant negative impactmaterial adverse effect on both the drilling and stimulation activity levels of our customers, and, therefore, the demand for our products and services.

In addition, our ability to continue to obtain insurance coverage on commercially reasonable terms is dependent upon a variety of factors impacting the insurance industry in general, which are outside our control. Any of the issues noted above, including insurance cost increases, uninsured or underinsured claims, or the inability of an insurance carrier to meet their financial obligations could have a material adverse effect on our profitability.business.

Our future effective tax rates could be adversely affected by changes in tax laws, both domestically and internationally, or the Ongoing Effects ofinterpretation or application thereof.  From time to time, the U.S. Tax CutsCongress and Jobs Actforeign, state and local governments consider legislation that could increase our effective tax rate. We cannot determine whether, or in what form, legislation will ultimately be

The U.S. Tax Cuts and Jobs Act (“Tax Act”) was enacted onin December 22, 2017, resulting in broad and complex changes to U.S. income tax law. Our effective tax rate may fluctuate inFollowing the future as a resultenactment of the Tax Act, which introduces significant changes to U.S. income tax law that will have a meaningful impact on our provision for income taxes. Accounting for the income tax effects of the Tax Act requires significant judgments and estimates in the interpretation and calculations of the provisions of the Tax Act. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, we made reasonable estimates of the effects and recorded provisional amounts in our financial statements for the year ended December 31, 2017. The U.S. Treasury Department, the U.S. Internal Revenue Service (“IRS”), and other standard-setting bodies mayhave continued to issue new guidance on howregarding the provisionsapplication or administration of the Tax Act. However, many aspects of the Tax Act willremain subject to interpretation, and additional Tax Act guidance is expected to continue to be applied or otherwise administered that is differentissued in the future. Any future guidance may differ from our interpretation. As we finalize the necessary data, and interpret the Tax Act and any additional guidance issued by the U.S. Treasury Department, the IRS or other standard-setting bodies, wecurrent interpretation, which may make adjustments to the provisional amounts that could materially affect our financial position and results of operations as well asresult in fluctuations in our effective tax rate in the period in which the adjustments are made.

As of December 31, 2017,2018, our consolidated balance sheet includes $43.6$43.8 million inof goodwill and $30.0$25.2 million of intangible assets, net, substantially all of which relates to the Mats and Integrated Services segment. Goodwill and indefinite-lived intangible assets are tested for impairment annually, or more frequently as the circumstances require, if any qualitative factors exist. In completing this annual evaluation during the fourth quarter of 2017,2018, we determined that no reporting unit has a fair value below its net carrying value, and therefore, no impairment is required.

The market for our products and services is characterized by continual technological developments that generate substantial improvements in product functions and performance. If we are not successful in continuing to develop product enhancements or new products that are accepted in the marketplace or that comply with industry standards, we could lose market share to competitors, which would negatively impactcould have a material adverse effect on our results of operations and financial condition.

Our success can be affected by our development and implementation of new product designs and improvements and by our ability to protect and maintain critical intellectual property assets related to these developments. Although in many cases our products are not protected by any registered intellectual property rights, in other cases we rely on a combination of patents and trade secret laws to establish and protect this proprietary technology. While patent rights give the owner of a patent the right to exclude third parties from making, using, selling, and offering for sale the inventions claimed in the patents, they do not necessarily grant the owner of a patent the right to practice the invention claimed in a patent. It may also be possible for a third party to design around our patents. We do not have patents in every country in which we conduct business and our patent portfolio will not protect all aspects of our business. When patent rights expire, competitors are generally free to offer the technology and products that were covered by the patents.

We also protect our trade secrets by customarily entering into confidentiality and/or license agreements with our employees, customers, and potential customers and suppliers. Our rights in our confidential information, trade secrets, and confidential know-how will not prevent third parties from independently developing similar information. Publicly available information (such as information in expired patents, published patent applications, and scientific literature) can also be used by third parties to independently develop technology. We cannot provide assurance that this independently developed technology will not be equivalent or superior to our proprietary technology.

We may from time to time engage in expensive and time-consuming litigation to determine the enforceability, scope, and validity of our patent rights. In addition, we can seek to enforce our rights in trade secrets, or “know-how,” and other proprietary information and technology in the conduct of our business. However, it is possible that our competitors may infringe upon, misappropriate, violate or challenge the validity or enforceability of our intellectual property, and we may not able to adequately protect or enforce our intellectual property rights in the future.

We have significant operations located in market areas around the world that are negatively impacted by severe adverse weather events such as hurricanes in the U.S. Gulf of Mexico, typhoons in Australia, droughts across the U.S. and related near-shore areas whichexcessive rains outside of the U.S. Additionally, there are susceptible to hurricanes and other adverse weather events. In these market areas we generated approximately 16%around the world in which our operations are subject to seasonality such as Canada where the Spring “break-up” (an industry term used to describe the time of year when the frost comes out of the ground causing the earth to become soft and muddy and strict weight restrictions are implemented by the government to prevent potholes forming on roads) results in a significant slowdown in the oil and natural gas industry and our consolidated revenue in 2017 and had approximately $215 million of inventory and property, plant and equipment as of December 31, 2017.drilling fluids business each year. Such adverse weather events and seasonality can disrupt our operations and result in damage to our properties, as well as negatively impact the activity and financial condition of our customers. Our business may be adversely affected by these and other negative effects of future hurricanes or other adverse weather events in regions in which we operate.

We utilize various management information systems and information technology infrastructure to manage or support a variety of our business operations, and to maintain various records, which may include confidential business or proprietary information as well as information regarding our customers, business partners, employees or other third parties. Failures of or interference with access to these systems, such as communication disruptions, could have an adverse effect on our ability to conduct operations or directly impact consolidated financial reporting. Security breaches pose a risk to confidential data and intellectual property, which could result in damagestransaction errors, processing inefficiencies, the loss of sales and customers, data privacy breaches and damage to our competitiveness and reputation. We have policies and procedures in place, including system monitoring and data back-up processes, to prevent or mitigate the effects of these potential disruptions or breaches, howeverbreaches. We do not carry insurance against these risks, although we do invest in security technology, perform penetration tests from time to time, and design our business processes to attempt to mitigate the risk of such breaches. However, there can be no assurance that existing or emerging threatssecurity breaches will not occur.

Additionally, the development and maintenance of these measures requires continuous monitoring as technologies change and efforts to overcome security measures evolve. We have an adverseexperienced, and expect to continue to experience, cybersecurity threats and incidents, none of which have been material to us to date. However, a successful breach or attack could have a material negative impact on our systemsoperations or communications networks. These risks couldbusiness reputation, harm our reputation and our relationships with our customers, business partners, employees or other third parties, and may result in claims against us.subject us to consequences such as litigation and direct costs associated with incident response. In addition, these risks could have a material adverse effect on our business, consolidated results of operations, and consolidated financial condition.

The market price of our common stockpublicly traded securities may fluctuate due to a number of factors, including the general economy, stock market conditions, general trends in the E&P industry, announcements made by us or our competitors, and variations in our operating results. Investors may not be able to predict the timing or extent of these fluctuations.

None.

We lease office space to support our operating segments as well as our corporate offices. All material domestic owned properties are subject to liens and security interests under our Amended ABL Facility.

The information concerning mine safety violations and other regulatory matters required by Section 1503 (a)1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95.1 of this Annual Report on Form 10-K, which is incorporated by reference.

Our common stock is traded on the New York Stock Exchange under the symbol “NR.”

We have not paid any dividends during the three most recent fiscal years or any subsequent interim period, and we do not intend to pay any cash dividends in the foreseeable future. In addition, our Amended ABL Facility contains covenants which limit the payment of dividends on our common stock. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Asset-Based Loan Facility.”

The following graph reflects a comparison of the cumulative total stockholder return of our common stock from January 1, 20132014 through December 31, 2017,2018, with the New York Stock Exchange Market Value Index, a broad equity market index, and the Morningstar Oil & Gas Equipment & Services Index, an industry group index. The graph assumes the investment of $100 on January 1, 20132014 in our common stock and each index and the reinvestment of all dividends, if any. This information shall be deemed furnished not filed, in this Form 10-K, and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, or the Securities Exchange Act of 1934, except to the extent we specifically incorporate it by reference.

During 2016 and 2015, operating loss includes charges totaling $14.8 million and $80.5 million, respectively, resulting from the reduction in value of certain assets, the wind-down of our operations in Uruguay, and the resolution of certain wage and hour litigation claims. Charges in 2016 include $6.9 million of non-cash impairments in the Asia Pacific region, $4.1 million of charges for the reduction in carrying values of certain inventory, and $4.5 million of charges in the Latin America region associated with the wind-down of our operations in Uruguay, partially offset by a $0.7 million gain in 2016 associated with the change in final settlement amount of certain wage and hour litigation claims. Charges in 2015 include a $70.7 million non-cash impairment of goodwill, a $2.6 million non-cash impairment of assets, a $2.2 million charge to reduce the carrying value of inventory, and a $5.0 million charge for the resolution of certain wage and hour litigation claims and related costs.

The following discussion of our financial condition, results of operations, liquidity, and capital resources should be read togetherin conjunction with our Consolidated Financial Statementsthe consolidated financial statements and Notes to Consolidated Financial Statementsnotes thereto included in Item 8 of this Annual Report.“Financial Statements and Supplementary Data.”

We are a geographically diversified supplier providing products, rentals, and services primarily to the oil and natural gas exploration and production (“E&P”) industry. We operate our business through two reportable segments: Fluids Systems and Mats and Integrated Services. In recent years,addition to the E&P industry, our Mats and Integrated Services segment has expanded beyond the E&P industry, and now serves a variety of industries, including the electrical transmission & distribution, pipeline, solar, petrochemical, and construction industries.

Our operating results depend, to a large extent, on oil and natural gas drilling activity levels in the markets we serve, and particularly for the Fluids Systems segment, the nature of the drilling operations (including the depth and whether the wells are drilled vertically or horizontally), which governs the revenue potential of each well. Drilling activity levels, in turn, dependsdepend on a variety of factors, including oil and natural gas commodity pricing, inventory levels, product demand, and regulatory restrictions. Oil and natural gas prices and activity are cyclical and volatile. Thisvolatile and this market volatility has a significant impact on our operating results.

Beginning in the fourth quarter oflate 2014 and continuing through early 2016, the price of oil declined dramatically from the price levels in previousprior years. As a result, E&P drilling activity levels significantly declined sharply in North America and many global markets over this period. Since reaching a low pointOil prices and drilling activity have since improved from the lows reached in early 2016, oil prices and North American drilling activity have steadily improved, although bothbut remain significantly lower than pre-downturn levels.levels and continue to be volatile. While our revenue potential is driven by a number of factors including those described above, rig count data remains the most widely accepted indicator of drilling activity. Average North AmericaAmerican rig count data for the last three years is as follows:

________________

As of February 16, 2018,15, 2019, the U.S. and Canadian rig counts were 9751,051 and 318,224, respectively. The Canadian rig count reflects the normal seasonality for this market, with the highest rig count levels generally observed in the first quarter of each year, prior to Spring break-up.

Outside of North America, drilling activity has remainedis generally more stable during this period as drilling activity in many countries is based upon longer termon longer-term economic projections and multiple yearmulti-year drilling programs, which tends to reduce the impact of short termshort-term changes in commodity prices on overall drilling activity. WhileAlthough drilling activity levels in certain of our international markets (including Brazil and Australia) hashave declined in recent years, as a whole, our international activities have remained relatively stable. This stability isstable, primarily driven by new contract awards, including those described below, which include geographical expansion into new markets as well as market share gains in existing markets. While our internationalkey contracts vary in revenue potential and duration, certain international contracts are scheduled to conclude in 2018, including those with Sonatrach and Petrobras. Our future revenue levels in international markets are largely dependent on our ability to maintain existing market share upon contract renewals which may be subject to a competitive bid process and can be impacted by our customers’ procurement strategies and allocation of contract awards.national oil companies.

Our Fluids Systems segment, which generated 82%76% of consolidated revenues in 2017,for 2018, provides customized fluids solutions to E&P customers globally, operating through four geographic regions: North America, Europe, the Middle East and Africa (“EMEA”), Latin America, and Asia Pacific.

In addition to our international expansion efforts, we are also expanding our presence in North America, capitalizing on our capabilities, infrastructure, and upgradestrong market position in the North American land drilling fluids blending, storage, and transfer capabilities inmarkets to expand our Fourchon, Louisiana facility which serves customers indrilling fluids presence within the deepwater Gulf of Mexico, deepwater market. This project is part ofas well as our Fluids Systems strategy to penetrate the Gulf of Mexico deepwater marketpresence in adjacent product offerings, including completion fluids and was substantially completed in the second quarter of 2017. Capital expenditures related to the Fourchon expansion totaled $6.9 million, $22.2 millionstimulation chemicals. To support this effort, we have incurred start-up costs, including costs associated with additional personnel and $10.1 million in 2017, 2016facility-related expenses, and 2015, respectively.have made additional capital investments.

Our Mats and Integrated Services segment, which generated 18%24% of consolidated revenues in 2017,for 2018, provides composite mat rentals utilized for temporary worksite access, along with site construction and related site services to customers in various markets including oil and gas exploration and production,E&P, electrical transmission & distribution, pipeline, solar, petrochemical, and construction industries across North America and Europe. We also sell composite mats to customers outside ofaround the U.S. and to domestic customers outside of the E&P market. Following our efforts in recent years to diversify our customer base,world. The Mats and Integrated Services segment revenues from non-E&P markets represented approximately two-thirdshalf of our segment revenues in 2017.for 2018.

In November 2017, we acquired certain assets and assumed certain liabilities of Well Service Group, Inc. and Utility Access Solutions, Inc. (together, “WSG”) for $77.9 million, which included $45.5 million of cash consideration and $32.4 million of our common equity.approximately $77 million. Since 2012, WSG hashad been a strategic logistics and installation service provider for our Mats and Integrated Service segment, offering a variety of complementary services to our composite matting systems, including access road construction, site planning and preparation, environmental protection, fluids and spill storage/containment, erosion control, and site restoration services. The completion of the WSG acquisition expanded our service offering as well as our geographic footprint across the Northeast, Midwest, Rockies, and West Texas regions of the U.S. FollowingThe WSG acquisition was the mid-November acquisition, WSG contributed approximately $9 millionprimary driver of the growth in service revenues tofor the Mats and Integrated Services segment in 2017, reflecting an annualized revenue level of approximately $70 million.for 2018.

The U.S. Tax Cuts and Jobs Act (“Tax Act”) was enacted onin December 22, 2017 resulting in broad and complex changes to U.S. income tax law. The Tax Act includesincluded a one-time transition tax in 2017 on accumulated foreign subsidiary earnings not previously subject to U.S. income tax, reducesreduced the U.S. corporate statutory tax rate from 35% to 21% effective January 1, 2018, generally eliminateseliminated U.S. federal income tax on dividends from foreign subsidiaries, createscreated new tax on certain foreign-sourced earnings, makesmade other changes to limit certain deductions and changeschanged rules on how certain tax credits and net operating loss carryforwards can be utilized.

The provision for income taxes was $15.0 million for 2018, reflecting an effective tax rate of 32%, compared to $4.9 million in 2017, reflecting an effective tax rate of 30%. The provision for income taxes for 2018 includes a $1.6 million net benefit related to the Tax Act, as described above. In addition, the 2018 effective tax rate was favorably impacted by excess tax benefits related to the vesting of certain stock-based compensation awards and a reduction in the valuation allowance related to our U.K. subsidiary. The provision for income taxes in 2017 includes a $3.4 million benefit resulting from the provisional amountsaccounting for the following incomeTax Act. The 2017 effective tax effectsrate was negatively impacted primarily by non-deductible expenses relative to the amount of pre-tax income.

Although the Tax Act:

Loss from disposal of discontinued operations includes a $17.4 million charge, net of tax, in 2017 for the Tax Act.

North America revenues increased 21% to $476.8 million in 2018, compared to $395.4 million in 2017. This increase was primarily attributable to the 13% increase in North American average rig count along with market share gains in both the North American land markets and the offshore Gulf of Mexico market.

The Fluids Systems chargessegment generated operating income of $40.3 million in 2016 included $6.92018 compared to $27.6 million of non-cash impairments in 2017. The increase in operating income includes an $8.7 million improvement from North American operations, reflecting the Asia Pacific region resultingincremental income generated from the continuing unfavorable industry market conditions and outlook$81.4 million increase in revenues discussed above, partially offset by an increase in operating expenses. Operating expenses for the region in 2016, $4.12018 include $3.0 million of charges for the reduction in carrying values of certain inventory, primarily resulting from lower ofrelated to severance costs associated with cost or market adjustments and $4.5optimization efforts, $0.8 million of charges in the Latin America region associated with the wind-downKenedy, Texas facility fire discussed above, as well as increased start-up costs associated with our product line expansion into stimulation chemicals and completion fluids, including $1.1 million of non-capitalizable expenses related to the upgrade and conversion of a drilling fluids facility into a completion fluids facility. Operating income from international operations increased by $4.0 million, primarily related to the increase in revenues described above, partially offset by a $1.2 million charge in Brazil primarily related to severance costs associated with workforce reductions, as discussed above.

Service revenues increased $58.1 million to $93.1 million in 2018, compared to $34.9 million in 2017 with substantially all of this increase attributable to the WSG acquisition completed in November 2017. Rental revenues increased $20.7 million to $81.8 million in 2018, compared to $61.1 million in 2017, primarily attributable to increased customer activity in pressure pumping applications as well as the impact of our operationscontinuing efforts to expand into non-E&P rental markets.

Product sales revenues were $55.9 million in Uruguay, including $0.52018 compared to $35.9 million in 2017. Revenues from product sales have typically fluctuated based on the timing of mat orders from customers; however, the improvement in 2018 is primarily attributable to our continued efforts to expand our sales into non-E&P markets.

Revenues increased 59% to $747.8 million in 2017, compared to $471.5 million in 2016. This $276.3 million increase includes a $268.0 million (108%) increase in revenues in North America, comprised of a $212.5 million increase in our Fluids Systems segment and a $55.5 million increase in the Mats and Integrated Services segment. Revenues from our international operations increased by $8.3 million (4%), as activity gains in the EMEA region, Brazil, and Chile were mostly offset by the completion of the offshore Uruguay project, which contributed $12.3 million of revenue in 2016. Additional information regarding the change in revenues is provided within the operating segment results below.

Cost of revenues increased 39% to $607.9 million in 2017, compared to $437.8 million in 2016. This increase was primarily driven by the 59% increase in revenues; however, cost of revenues contain substantial levels of fixed costs in each business, including significant depreciation, facility costs and personnel expenses, resulting in the lower increase in cost of revenues relative to the change in revenues. In addition, 2016 included $4.6 million of employee severance costs which did not recur in 2017.

Selling, general and administrative expenses increased $20.4 million to $108.8 million in 2017 from $88.5 million in 2016. The increase in expenses is primarily attributable to a $10.6 million increase in performance-based incentive compensation as well as elevated spending related to strategic planning efforts and legal matters, including the WSG acquisition described above. Selling, general and administrative expenses as a percentage of revenues decreased to 14.6% in 2017 from 18.8% in the prior year.2016.

Other operating income was $0.4 million in 2017 as compared to $4.3 million in 2016, primarily reflecting gains on the sale of assets in both periods.

During 2017, we did not recognize any impairments and other charges. During 2016, we recognized $6.7 million of impairments and other charges. As previously described, theseThese charges primarily included $6.9 million of non-cash impairments in our Asia Pacific region includingresulting from the unfavorable industry market conditions and outlook for the region in 2016 and included a $3.8 million charge to write-down property, plant and equipment to its estimated fair value and a $3.1

Foreign currency exchange was a $2.1 million loss in 2017 compared to a $0.7 million gain in 2016, reflecting the impact of currency translation on assets and liabilities (including intercompany balances) that are denominated in currencies other than functional currencies.

Interest expense totaled $13.3 million in 2017 compared to $9.9 million in 2016. This increase was primarily attributable to a $3.7 million increase in non-cashnoncash amortization of debt discount associated with the 2021 Convertible Notes and lower capitalized interest in 2017 as compared to 2016. These increases were partially offset by $1.1 million of charges in the second quarter of 2016 for the write-off of debt issuance costs related to the termination and replacement of our revolving Credit Agreement. See “Note 6 – Financing Arrangements” for further discussion of the accounting treatment for the 2021 Convertible Notes.

The $1.6 million gain on extinguishment of debt in 2016 reflects the difference in the amount paid and the net carrying value of the extinguished debt, including debt issuance costs, related to the repurchase of $89.3 million aggregate principal amount of our 2017 Convertible Notes.

The provision for income taxes forin 2017 was $4.9 million, reflecting an effective tax rate of 30.4%30%, compared to a $24.0 million benefit in 2016, reflecting an effective tax rate of 37.1%37%. The provision for income taxes in 2017 includes a $3.4 million benefit resulting from the provisional accounting for the Tax Act as previously described. In addition, the 2017 effective tax rate was negatively impacted primarily by non-deductible expenses relative to the amount of pre-tax income.

The benefit for income taxes in 2016 included a $9.3 million benefit associated with a worthless stock deduction and related impacts from restructuring the investment in our Brazilian subsidiary, partially offset by the unfavorable impact of pretax losses incurred in Australia, including $6.9 million of impairment charges, for which the recording of a tax benefit is not permitted.

Loss from disposal of discontinued operations includes a $17.4 million charge, net of tax, in 2017 for the settlement of a pending litigation matter related to the March 2014 sale of our Environmental Services business. See “Note 14 – Discontinued Operations” and “Note 15 – Commitments and Contingencies” in our consolidated financial statements for additional information.

Summarized financial information for our reportable segments is shown in the following table (net of inter-segment transfers):

North America revenues increased 116% to $395.4 million in 2017 compared to $182.9 million in 2016. This increase in revenues is primarily attributable to the 69% increase in North American average rig count along with market share gains and higher customer spending per well in 2017 compared to the prior year.2016. Canadian revenues also included a $4.8 million increase from the August 2016 acquisition of Pragmatic Drilling Fluids Additives, Ltd.

Internationally, revenues increased 4% to $220.4 million in 2017 compared to $212.5 million in 2016. The increase in the EMEA region is primarily attributable to an increase in customer activity levels in Algeria and Romania. The decrease in the Latin America region is attributable to completion of the offshore Uruguay project which contributed $12.3 million of revenue in 2016 partially offset by increased activity with Petrobras in Brazil and an increase in revenue from a customer contract in Chile which started in the fourth quarter of 2016.

The Fluids Systems segment generated operating income of $27.6 million in 2017 compared to an operating loss of $43.6 million in 2016, representing a $71.2 million improvement in operating results. The operating loss in 2016 includes $15.5 million of charges related to asset impairments and $4.1 million of charges related to workforce reductions, as previously described.reductions. The $15.5 million of charges in 2016 included $6.9 million of non-cash impairments in the Asia Pacific region resulting from the unfavorable industry market

The remaining $51.6 million increase in operating results includes a $48.7 million improvement from North American operations and a $2.9 million increase in operating income from international operations. The improvement in North American operating results is largely attributable to the $212.5 million increase in revenues described above. The increase in international operating income is primarily attributable to the increase in revenues as well as the benefit of cost reduction programs in the Asia Pacific region.

Mat rental and servicesService revenues forincreased 98% to $34.9 million in 2017, increased $37.7 million compared to $17.6 million in 2016 and includes approximately $8 million of service revenues from the WSG acquisition in mid-November 2017. Rental revenues increased 50% to $61.1 million in 2017, compared to $40.7 million in 2016. This improvement includesThese improvements include an increase in revenuerevenues from E&P customer activity, attributable to the improvement in oil prices, as well as increases in non-E&P customer activity associated with our continued efforts to expand beyond our traditional oilfield customer base and strong weather-related demand for rental mats. The 2017 operating results also include approximately $9 million of services revenue from the WSG acquisition in mid-November.

Revenues from matProduct sales revenues were $35.9 million in 2017 compared to $17.6 million in 2016. Revenues from matproduct sales have typically fluctuated based on the timing of mat orders from customers. The improvement in 2017 is primarily attributable to our continued efforts to further expand our sales into non-E&P markets.

Segment operating income increased by $25.8 million to $40.5 million forin 2017 as compared to $14.7 million in 2016, attributable to the increases in both mat sales and rental and services revenues as described above. Due to the relatively fixed nature of operating expenses, increases in revenue have a higher incremental impact on segment operating margin.

Corporate office expenses increased $8.3 million to $36.6 million in 2017, compared to $28.3 million forin 2016. The increase is primarily attributable to a $2.7 million increase in performance-based incentive compensation and a $2.0 million increase in spending related to strategic planning efforts and legal matters, including the Ecoserv lawsuit described further in “Note 15 - Commitments and Contingencies.”Note 15. The 2017 operating results also include a $1.0 million increase in acquisition related costs, primarily attributable to the WSG acquisition.

Net cash provided by operating activities during 2017 totaledwas $63.4 million in 2018 compared to $38.4 million compared to $11.1 million during 2016. The increase in 2017. Net cash provided by operating cash flow is primarily attributable to the improvements in operational performance in North America. As a result of the 59% improvement in consolidated revenues, net income adjusted for non-cash items provided $57.4 million of operating cashactivities in 2017 while an increase in working capital required to supportincluded the growth used $19.1 millionreceipt of cash in 2017, primarily reflecting increases in trade receivables offset by a $37.2 million tax refund received in the second quarter of 2017. The increase in net cash provided by operating activities in 2018 compared to 2017 was primarily due to an improvement in operating results and decreases in the growth of working capital. During 2018, net income adjusted for non-cash items provided cash of $94.7 million, while changes in working capital used $31.3 million of cash, substantially all of which was attributable to increases in inventory.

Net cash used in investing activities was $55.8 million in 2018, including capital expenditures of $45.1 million and the $14 million payment to refund a portion of the net sales price of the Environmental Services business (see Note 15 for further discussion). Capital expenditures during 20172018 included $27.0 million for the Mats and Integrated Services segment, including $18.4 million of investments in the mat rental fleet, and $15.4 million for the Fluids Systems segment. Net cash used in investing activities was $68.4 million in 2017, including $44.8 million associated with the WSG acquisition. Investing activities also included capital expenditures of $31.4 million, including $17.6 million in the Fluids Systems segment, of which $6.9 million related to the facility upgrade and expansion of our Fourchon, Louisiana facility. The Mats and Integrated Services segment capital expenditures totaled $12.0 million during 2017, primarily reflecting investments in the mat rental fleet.

Net cash used in financing activities during 2017 was $2.3 million. We borrowed a$4.5 million in 2018 and primarily related to net $81.6 millionrepayment of borrowings on our Amended ABL Facility in 2017, which largely funded repayment of the $83.3 million 2017 Convertible Notes that matured in October 2017.Facility.

As of December 31, 2017,2018, we had cash on-hand of $56.4$56.1 million, substantially all of which resides within our international subsidiaries. As a result of the Tax Act as previously described, we intend to pursue repatriation of availablebegan repatriating excess cash infrom certain of our international subsidiaries in 2018 and we intend to continue repatriating excess cash from these international subsidiaries, subject to cash requirements to support the strategic objectives of these international subsidiaries and finalization of our analysis of the impacts of the Tax Act.subsidiaries. We anticipate that our future working capital requirements for our operations will fluctuate directionally with revenues. In addition, we expect total 20182019 capital expenditures to be approximately $20$35 million to $25 million.$45 million, depending in part on the investment requirements to support further growth in the mats rental business as well as the timing of a capital investment to support expansion in Northern Kuwait, where we expect to invest approximately $8 million to construct a second base of operations. Availability under our Amended ABL Facility also provides additional liquidity as discussed further below. Total availability under the Amended ABL Facility will fluctuate directionally based on the level of eligible accounts receivable, inventory, and, subject to satisfaction of certain financial covenants as described below, composite mats included in the rental fleet. We expect our available cash on-hand, cash generated by operations and remaining availability under our Amended ABL Facility to be adequate to fund current operations during the next 12 months. In January 2019, we used $5 million of cash to repurchase shares of our common stock under our existing Board authorized repurchase program. We may continue to make repurchases under this authorization from time to time during 2019.

Holders may convert the notes at their option at any time prior to the close of business on the business day immediately preceding June 1, 2021, only under the following circumstances:

On or after June 1, 2021 until the close of business on the business day immediately preceding the maturity date, holders may convert their notes at any time, regardless of whether any of the foregoing conditions have been satisfied. As of February 23, 2018,19, 2019, the notes were not convertible.

The notes are convertible into, at our election, cash, shares of common stock, or a combination of both, subject to satisfaction of specified conditions and during specified periods, as described above. If converted, we currently intend to pay cash for the principal amount of the notes converted. The conversion rate is initially 107.1381 shares of our common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of $9.33 per share of common stock), subject to adjustment in certain circumstances. We may not redeem the notes prior to their maturity date.