Halliburton Announces Third Quarter Income from Continuing Operations of $0.31 Per Diluted Share, Excluding Special Items
• Reported loss from continuing operations of $0.06 per diluted share
Halliburton Company (NYSE:HAL) announced today that income from
continuing operations for the third quarter of 2015 was $265 million, or
$0.31 per diluted share, excluding special items. This compares to
income from continuing operations for the second quarter of 2015 of $380
million, or $0.44 per diluted share, excluding special items. Adjusted
operating income was $506 million in the third quarter of 2015, compared
to adjusted operating income of $643 million in the second quarter of
2015. Halliburton's total revenue in the third quarter of 2015 was $5.6
billion, compared to $5.9 billion in the second quarter of 2015.
Primarily as a result of the downturn in the energy market and its
corresponding impact on the company’s business outlook, Halliburton
recorded company-wide charges related primarily to asset write-offs and
severance costs of approximately $257 million, after-tax, or $0.30 per
diluted share, in the third quarter of 2015, as compared to $258
million, after-tax, or $0.30 per diluted share, in the second quarter of
2015. Halliburton recorded Baker Hughes acquisition-related costs of $62
million, after-tax, or $0.07 per diluted share, in the third quarter of
2015, as compared to $67 million, after-tax, or $0.08 per diluted share,
in the second quarter of 2015. Reported loss from continuing operations
was $54 million, or $0.06 per diluted share, in the third quarter of
2015, as compared to reported income from continuing operations of $55
million, or $0.06 per diluted share, in the second quarter of 2015.
Reported operating income was $43 million for the third quarter of 2015,
as compared to reported operating income of $254 million for the second
quarter of 2015.
“We are pleased with our third quarter results, especially the
resilience of our international business, where we outperformed our
largest peer on a sequential and year-over-year basis for both revenue
and margins,” said Jeff Miller, President.
“Total company revenue of $5.6 billion declined 6% sequentially, while
adjusted operating income declined 21%. North America led the decline as
a result of continued activity declines and pricing pressure.
“In the Eastern Hemisphere, third quarter revenue declined by 5%, but
despite activity and pricing headwinds, operating income margins
remained at similar levels to the second quarter, due to our relentless
focus on cost management.
“Latin America revenue and operating income declined by 4% sequentially,
driven primarily by activity reductions in Mexico, partially offset by
improved activity levels in Argentina.
“North America third quarter revenue declined 7% sequentially, with
operating income at near breakeven levels while we continue to retain
our service delivery infrastructure in anticipation of the Baker Hughes
acquisition. We saw another step down in activity levels throughout the
third quarter, accompanied by further price reductions across the
business, especially in the pumping-related product lines, while our
North America Drilling & Evaluation margins increased to 10%.
“This is a challenging market, but our strategy remains the same. We are
looking through this cycle to ensure that we are positioned to
accelerate our growth when the industry recovers, and we are managing
through the downturn by drawing upon our management’s deep experience in
navigating through past cycles. Our financial results reflect our strong
execution culture, and we remain focused on delivering reliable,
best-in-class service quality for our customers,” said Miller.
“As we continue to work toward the closing of the pending Baker Hughes
acquisition, we are diligently focused on finalizing all regulatory
filings, completing the divestiture process, and preparing for
integration activities after the closing of the deal,” added Dave Lesar,
Chairman and CEO.
“We are enthusiastic about and fully committed to closing this
compelling transaction, and remain confident we can achieve annual cost
synergies of nearly $2 billion. We continue to maintain our superior
service delivery platform and other infrastructure costs in excess of
current market needs. This cost was approximately 400 basis points for
North America margins in the third quarter.
“We continue to invest in technology, build capital equipment, and
prepare for our pending acquisition of Baker Hughes. There are a number
of moving parts in the market today, and we are not going to try to call
the exact shape of recovery, but we expect that the longer it takes, the
sharper it will be. Ultimately, when this market recovers we believe
North America will respond the quickest and offer the greatest upside,
and that Halliburton will be positioned to outperform,” concluded Lesar.
Completion and Production
Completion and Production (C&P) revenue in the third quarter of 2015 was
$3.2 billion, a decrease of $244 million, or 7%, from the second quarter
of 2015, primarily driven by a decline in activity and pricing pressure
for all product service lines in the United States, reduced pressure
pumping activity in Latin America, lower stimulation activity in Middle
East/Asia, and reduced pressure pumping services and completion tools
sales in Europe/Africa/CIS. This was partially offset by higher
completion tools sales in Brazil, higher stimulation services in
Argentina, and increased stimulation activity in Canada.
C&P operating income was $163 million, which decreased $150 million, or
48%, compared to the second quarter of 2015. North America C&P operating
income declined $122 million, or 167%, sequentially, primarily due to
reduced activity levels and downward pricing adjustments for most
product service lines. Latin America C&P operating income decreased $2
million, or 4%, from the second quarter of 2015, primarily as a result
of reduced activity in cementing services in Mexico and lower production
solutions and cementing activity in Venezuela, which more than offset
higher stimulation activity in Argentina. Europe/Africa/CIS C&P
operating income fell $13 million, or 14%, sequentially, mainly due to
reduced stimulation activity and completion tools sales in Angola.
Middle East/Asia C&P operating income decreased by $13 million, or 14%,
compared to the second quarter of 2015, primarily due to a decline in
stimulation activity in Saudi Arabia and reduced production solutions
activity in Iraq.
Drilling and Evaluation
Drilling and Evaluation (D&E) revenue in the third quarter of 2015 was
$2.4 billion, a decrease of $93 million, or 4%, from the second quarter
of 2015. Decreased drilling and logging services in North America,
coupled with a decline in drilling services and offshore testing
activity across all regions, more than offset increased project
management activity in Middle East/Asia.
D&E operating income was $401 million, which remained relatively flat
compared to the second quarter of 2015. North America D&E operating
income remained flat, sequentially, as savings from cost reduction
initiatives were partially offset by pricing pressure and reduced
logging services in the United States land market. Latin America D&E
operating income declined $2 million, or 4%, sequentially, as reduced
drilling activity in Mexico more than offset increased fluid services in
Brazil and higher software sales in Colombia. Europe/Africa/CIS D&E
operating income remained essentially flat from the second quarter of
2015, as increased drilling services in Nigeria and higher fluid
services in Angola were partially offset by reduced fluid services in
Tanzania and decreased drilling services in Angola. Middle East/Asia D&E
operating income increased $4 million, or 2%, sequentially, driven by
activity growth for drilling and logging services in United Arab
Emirates, coupled with increased project management activity in Iraq,
and higher drilling activity in Saudi Arabia.
Corporate and Other
During the third quarter of 2015, Halliburton incurred $62 million,
after-tax, for costs related to the pending Baker Hughes acquisition.
Significant Recent Events and Achievements
-
Halliburton and Baker Hughes announced that the timing agreement with
the Antitrust Division of the U.S. Department of Justice has been
extended to the later of December 15, 2015 or 30 days following the
date on which both companies have certified final, substantial
compliance with the DOJ second request. In light of the timing
agreement, Halliburton and Baker Hughes have agreed to extend the time
period for closing of the acquisition pursuant to the Merger Agreement
to December 16, 2015. The Merger Agreement also provides that the
closing can be extended into 2016, if necessary.
-
Halliburton and Baker Hughes announced that the companies will market
for sale additional businesses in connection with Halliburton's
pending acquisition of Baker Hughes. Pursuant to the Merger Agreement,
and in order to permit completion of Halliburton's acquisition of
Baker Hughes, Halliburton's expandable liner hangers business, which
is part of the company's Completion & Production Division, is intended
to be divested.
-
Halliburton announced that two of the company's facilities and nine of
the company's business lines in Brazil received the American Petroleum
Institute Specification Q2 Certification (API Q2), an advanced
industry certification standard for oil and natural gas service
companies. They are the first in Latin America to receive the
certification. API Q2 is a risk-based quality management system
approach that focuses on competency, service design, contingency
planning, supply chain controls, preventive maintenance, inspection,
service quality plans and management of change.
-
Halliburton announced that for the sixth consecutive year, the Dow
Jones Sustainability Indices (DJSI) identify Halliburton as a leader
in corporate sustainability. The company exceeded industry averages in
the Economic, Environmental and Social Performance categories,
maintaining its place in the DJSI World Index. Halliburton's continued
commitment to advancing its global vision and goals for corporate
responsibility and sustainability earned high rankings in several
industry categories, and the company received industry best scores for
Codes of Conduct, Compliance, Corruption and Bribery; Releases to the
Environment; and Human Capital Development. Halliburton received a
perfect score in the "Releases to the Environment" category.
About Halliburton
Founded in 1919, Halliburton is one of the world's largest providers of
products and services to the energy industry. With approximately 65,000
employees, representing 140 nationalities in approximately 80 countries,
the company serves the upstream oil and gas industry throughout the
lifecycle of the reservoir - from locating hydrocarbons and managing
geological data, to drilling and formation evaluation, well construction
and completion, and optimizing production through the life of the field.
Visit the company’s website at www.halliburton.com.
Connect with Halliburton on Facebook,
Twitter,
LinkedIn,
Oilpro
and YouTube.
NOTE: The statements in this press release that are not historical
statements, including statements regarding future financial performance
and the pending Baker Hughes transaction, are forward-looking statements
within the meaning of the federal securities laws. These statements are
subject to numerous risks and uncertainties, many of which are beyond
the company's control, which could cause actual results to differ
materially from the results expressed or implied by the statements.
These risks and uncertainties include, but are not limited to: with
respect to the Baker Hughes acquisition, the timing to consummate the
proposed transaction; the terms and timing of divestitures undertaken to
obtain required regulatory approvals; the conditions to closing of the
proposed transaction may not be satisfied or the closing of the proposed
transaction otherwise does not occur; the risk a regulatory approval
that may be required for the proposed transaction is not obtained or is
obtained subject to conditions that are not anticipated; the diversion
of management time on transaction-related issues; the ultimate timing,
outcome and results of integrating the operations of Halliburton and
Baker Hughes and the ultimate outcome of Halliburton’s operating
efficiencies applied to Baker Hughes’s products and services; the
effects of the business combination of Halliburton and Baker Hughes,
including the combined company’s future financial condition, results of
operations, strategy and plans; expected synergies and other benefits
from the proposed transaction and the ability of Halliburton to realize
such synergies and other benefits; with respect to the Macondo well
incident, final court approval of, and the satisfaction of the
conditions in, Halliburton's September 2014 settlement, including the
results of any appeals of rulings in the multi-district litigation;
indemnification and insurance matters; with respect to repurchases of
Halliburton common stock, the continuation or suspension of the
repurchase program, the amount, the timing and the trading prices of
Halliburton common stock, and the availability and alternative uses of
cash; changes in the demand for or price of oil and/or natural gas can
be significantly impacted by weakness in the worldwide economy;
consequences of audits and investigations by domestic and foreign
government agencies and legislative bodies and related publicity and
potential adverse proceedings by such agencies; protection of
intellectual property rights and against cyber attacks; compliance with
environmental laws; changes in government regulations and regulatory
requirements, particularly those related to offshore oil and natural gas
exploration, radioactive sources, explosives, chemicals, hydraulic
fracturing services, and climate-related initiatives; compliance with
laws related to income taxes and assumptions regarding the generation of
future taxable income; risks of international operations, including
risks relating to unsettled political conditions, war, the effects of
terrorism, foreign exchange rates and controls, international trade and
regulatory controls, and doing business with national oil companies;
weather-related issues, including the effects of hurricanes and tropical
storms; changes in capital spending by customers; delays or failures by
customers to make payments owed to us; execution of long-term,
fixed-price contracts; structural changes in the oil and natural gas
industry; maintaining a highly skilled workforce; availability and cost
of raw materials; and integration and success of acquired businesses and
operations of joint ventures. Halliburton's Form 10-K for the year ended
December 31, 2014, Form 10-Q for the quarter ended June 30, 2015, recent
Current Reports on Form 8-K, and other Securities and Exchange
Commission filings discuss some of the important risk factors identified
that may affect Halliburton's business, results of operations, and
financial condition. Halliburton undertakes no obligation to revise or
update publicly any forward-looking statements for any reason.
Additional Information
This communication does not constitute an offer to buy or sell or the
solicitation of an offer to buy or sell any securities or a solicitation
of any vote or approval. This communication relates to a proposed
business combination between Halliburton and Baker Hughes. In connection
with this proposed business combination, Halliburton has filed with the
Securities and Exchange Commission (the “SEC”) a registration statement
on Form S-4, including Amendments No. 1 and 2 thereto, and a definitive
joint proxy statement/prospectus of Halliburton and Baker Hughes and
other documents related to the proposed transaction. The registration
statement was declared effective by the SEC on February 17, 2015 and the
definitive proxy statement/prospectus has been mailed to stockholders of
Halliburton and Baker Hughes. INVESTORS AND SECURITY HOLDERS OF
HALLIBURTON AND BAKER HUGHES ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS, REGISTRATION STATEMENT AND OTHER DOCUMENTS FILED
OR THAT MAY BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION. Investors
and security holders may obtain free copies of these documents and other
documents filed with the SEC by Halliburton and/or Baker Hughes through
the website maintained by the SEC at http://www.sec.gov.
Copies of the documents filed with the SEC by Halliburton are available
free of charge on Halliburton’s internet website at http://www.halliburton.com
or by contacting Halliburton’s Investor Relations Department by email at investors@Halliburton.com
or by phone at +1-281-871-2688. Copies of the documents filed with the
SEC by Baker Hughes are available free of charge on Baker Hughes’
internet website at http://www.bakerhughes.com
or by contacting Baker Hughes’ Investor Relations Department by email at alondra.oteyza@bakerhughes.com
or by phone at +1-713-439-8822.
Participants in Solicitation
Halliburton, Baker Hughes, their respective directors and certain of
their respective executive officers may be considered participants in
the solicitation of proxies in connection with the proposed transaction.
Information about the directors and executive officers of Halliburton is
set forth in its Annual Report on Form 10-K for the year ended December
31, 2014, which was filed with the SEC on February 24, 2015, its proxy
statement for its 2015 annual meeting of stockholders, which was filed
with the SEC on April 7, 2015, and its Quarterly Report on Form 10-Q for
the quarter ended June 30, 2015, which was filed with the SEC on July
24, 2015. Information about the directors and executive officers of
Baker Hughes is set forth in its Annual Report on Form 10-K for the year
ended December 31, 2014, which was filed with the SEC on February 26,
2015, its proxy statement for its 2015 annual meeting of stockholders,
which was filed with the SEC on March 27, 2015, and its Quarterly Report
on Form 10-Q for the quarter ended June 30, 2015, which was filed with
the SEC on July 23, 2015. These documents can be obtained free of charge
from the sources indicated above. Additional information regarding the
participants in the proxy solicitations and a description of their
direct and indirect interests, by security holdings or otherwise, are
contained in the proxy statement/prospectus and other relevant materials
filed with the SEC.
|
|
|
|
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
September 30
|
|
|
June 30
|
|
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
Completion and Production
|
|
|
|
$
|
3,200
|
|
|
|
$
|
5,420
|
|
|
|
$
|
3,444
|
|
Drilling and Evaluation
|
|
|
|
|
2,382
|
|
|
|
|
3,281
|
|
|
|
|
2,475
|
|
Total revenue
|
|
|
|
$
|
5,582
|
|
|
|
$
|
8,701
|
|
|
|
$
|
5,919
|
|
Operating income:
|
|
|
|
|
|
|
|
|
|
|
Completion and Production
|
|
|
|
$
|
163
|
|
|
|
$
|
1,071
|
|
|
|
$
|
313
|
|
Drilling and Evaluation
|
|
|
|
|
401
|
|
|
|
|
451
|
|
|
|
|
400
|
|
Corporate and other
|
|
|
|
|
(58
|
)
|
|
|
|
112
|
|
|
|
|
(70
|
)
|
Impairments and other charges
|
|
|
|
|
(381
|
)
|
|
|
|
-
|
|
|
|
|
(306
|
)
|
Baker Hughes acquisition-related costs
|
|
|
|
|
(82
|
)
|
|
|
|
-
|
|
|
|
|
(83
|
)
|
Total operating income
|
|
|
|
|
43
|
|
|
|
|
1,634
|
|
|
|
|
254
|
|
Interest expense, net
|
|
|
|
|
(99
|
)
|
|
|
|
(96
|
)
|
|
|
|
(106
|
)
|
Other, net
|
|
|
|
|
(34
|
)
|
|
|
|
12
|
|
|
|
|
(23
|
)
|
Income (loss) from continuing operations before income taxes
|
|
|
|
|
(90
|
)
|
|
|
|
1,550
|
|
|
|
|
125
|
|
Income tax benefit (provision)
|
|
|
|
|
37
|
|
|
|
|
(411
|
)
|
|
|
|
(71
|
)
|
Income (loss) from continuing operations
|
|
|
|
|
(53
|
)
|
|
|
|
1,139
|
|
|
|
|
54
|
|
Income (loss) from discontinued operations, net
|
|
|
|
|
-
|
|
|
|
|
66
|
|
|
|
|
(1
|
)
|
Net income (loss)
|
|
|
|
$
|
(53
|
)
|
|
|
$
|
1,205
|
|
|
|
$
|
53
|
|
Net (income) loss attributable to noncontrolling interest
|
|
|
|
|
(1
|
)
|
|
|
|
(2
|
)
|
|
|
|
1
|
|
Net income (loss) attributable to company
|
|
|
|
$
|
(54
|
)
|
|
|
$
|
1,203
|
|
|
|
$
|
54
|
|
Amounts attributable to company shareholders:
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
$
|
(54
|
)
|
|
|
$
|
1,137
|
|
|
|
$
|
55
|
|
Income (loss) from discontinued operations, net
|
|
|
|
|
-
|
|
|
|
|
66
|
|
|
|
|
(1
|
)
|
Net income (loss) attributable to company
|
|
|
|
$
|
(54
|
)
|
|
|
$
|
1,203
|
|
|
|
$
|
54
|
|
Basic income (loss) per share attributable to company
shareholders:
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
1.34
|
|
|
|
$
|
0.06
|
|
Income from discontinued operations, net
|
|
|
|
|
-
|
|
|
|
|
0.08
|
|
|
|
|
-
|
|
Net income (loss) per share
|
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
1.42
|
|
|
|
$
|
0.06
|
|
Diluted income (loss) per share attributable to company
shareholders:
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
1.33
|
|
|
|
$
|
0.06
|
|
Income from discontinued operations, net
|
|
|
|
|
-
|
|
|
|
|
0.08
|
|
|
|
|
-
|
|
Net income (loss) per share
|
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
1.41
|
|
|
|
$
|
0.06
|
|
Basic weighted average common shares outstanding
|
|
|
|
|
855
|
|
|
|
|
848
|
|
|
|
|
852
|
|
Diluted weighted average common shares outstanding
|
|
|
|
|
855
|
|
|
|
|
854
|
|
|
|
|
854
|
|
|
See Footnote Table 1 for Reconciliation of As Reported Operating
Income to Adjusted Operating Income.
|
|
See Footnote Table 2 for Reconciliation of As Reported Income (Loss)
from Continuing Operations to Adjusted Income from Continuing
Operations.
|
|
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30
|
|
|
|
2015
|
|
|
|
2014
|
Revenue:
|
|
|
|
|
|
|
|
Completion and Production
|
|
|
$
|
10,890
|
|
|
|
|
$
|
14,782
|
|
Drilling and Evaluation
|
|
|
|
7,661
|
|
|
|
|
|
9,318
|
|
Total revenue
|
|
|
$
|
18,551
|
|
|
|
|
$
|
24,100
|
|
Operating income (loss):
|
|
|
|
|
|
|
|
Completion and Production
|
|
|
$
|
938
|
|
|
|
|
$
|
2,619
|
|
Drilling and Evaluation
|
|
|
|
1,107
|
|
|
|
|
|
1,263
|
|
Corporate and other
|
|
|
|
(198
|
)
|
|
|
|
|
(84
|
)
|
Impairments and other charges
|
|
|
|
(1,895
|
)
|
|
|
|
|
-
|
|
Baker Hughes acquisition-related costs
|
|
|
|
(203
|
)
|
|
|
|
|
-
|
|
Total operating income (loss)
|
|
|
|
(251
|
)
|
|
|
|
|
3,798
|
|
Interest expense, net
|
|
|
|
(311
|
)
|
|
|
|
|
(283
|
)
|
Other, net (a)
|
|
|
|
(281
|
)
|
|
|
|
|
(43
|
)
|
Income (loss) from continuing operations before income taxes
|
|
|
|
(843
|
)
|
|
|
|
|
3,472
|
|
Income tax benefit (provision)
|
|
|
|
207
|
|
|
|
|
|
(939
|
)
|
Income (loss) from continuing operations
|
|
|
|
(636
|
)
|
|
|
|
|
2,533
|
|
Income (loss) from discontinued operations, net
|
|
|
|
(5
|
)
|
|
|
|
|
63
|
|
Net income (loss)
|
|
|
$
|
(641
|
)
|
|
|
|
$
|
2,596
|
|
Net (income) loss attributable to noncontrolling interest
|
|
|
|
(2
|
)
|
|
|
|
|
3
|
|
Net income (loss) attributable to company
|
|
|
$
|
(643
|
)
|
|
|
|
$
|
2,599
|
|
Amounts attributable to company shareholders:
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
$
|
(638
|
)
|
|
|
|
$
|
2,536
|
|
Income (loss) from discontinued operations, net
|
|
|
|
(5
|
)
|
|
|
|
|
63
|
|
Net income (loss) attributable to company
|
|
|
$
|
(643
|
)
|
|
|
|
$
|
2,599
|
|
Basic income (loss) per share attributable to company
shareholders:
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
$
|
(0.75
|
)
|
|
|
|
$
|
2.99
|
|
Income (loss) from discontinued operations, net
|
|
|
|
(0.01
|
)
|
|
|
|
|
0.07
|
|
Net income (loss) per share
|
|
|
$
|
(0.76
|
)
|
|
|
|
$
|
3.06
|
|
Diluted income (loss) per share attributable to company
shareholders:
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
$
|
(0.75
|
)
|
|
|
|
$
|
2.97
|
|
Income (loss) from discontinued operations, net
|
|
|
|
(0.01
|
)
|
|
|
|
|
0.08
|
|
Net income (loss) per share
|
|
|
$
|
(0.76
|
)
|
|
|
|
$
|
3.05
|
|
Basic weighted average common shares outstanding
|
|
|
|
852
|
|
|
|
|
|
848
|
|
Diluted weighted average common shares outstanding
|
|
|
|
852
|
|
|
|
|
|
853
|
|
|
|
|
(a)
|
|
Includes a foreign currency loss of $199 million due to a currency
devaluation in Venezuela in the nine months ended September 30, 2015.
|
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Condensed Consolidated Balance Sheets
(Millions of dollars)
|
|
|
|
(Unaudited)
|
|
|
|
|
September 30
|
|
|
December 31
|
|
|
|
2015
|
|
|
2014
|
Assets
|
Current assets:
|
|
|
|
|
|
|
Cash and equivalents
|
|
|
$
|
2,249
|
|
|
$
|
2,291
|
Receivables, net
|
|
|
5,791
|
|
|
7,564
|
Inventories
|
|
|
2,692
|
|
|
3,571
|
Assets held for sale (a)
|
|
|
2,082
|
|
|
-
|
Other current assets (b)
|
|
|
2,105
|
|
|
1,642
|
Total current assets
|
|
|
14,919
|
|
|
15,068
|
|
|
|
|
|
|
|
Property, plant, and equipment, net
|
|
|
11,018
|
|
|
12,475
|
Goodwill
|
|
|
2,124
|
|
|
2,330
|
Other assets (c)
|
|
|
2,187
|
|
|
2,367
|
Total assets
|
|
|
$
|
30,248
|
|
|
$
|
32,240
|
|
|
|
|
|
|
|
Liabilities and Shareholders’ Equity
|
Current liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
|
$
|
2,193
|
|
|
$
|
2,814
|
Accrued employee compensation and benefits
|
|
|
871
|
|
|
1,033
|
Current maturities of long-term debt
|
|
|
648
|
|
|
-
|
Loss contingency for Macondo well incident
|
|
|
400
|
|
|
367
|
Other current liabilities
|
|
|
1,591
|
|
|
1,669
|
Total current liabilities
|
|
|
5,703
|
|
|
5,883
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
7,243
|
|
|
7,840
|
Employee compensation and benefits
|
|
|
576
|
|
|
691
|
Loss contingency for Macondo well incident
|
|
|
72
|
|
|
439
|
Other liabilities
|
|
|
1,174
|
|
|
1,089
|
Total liabilities
|
|
|
14,768
|
|
|
15,942
|
|
|
|
|
|
|
|
Company shareholders’ equity
|
|
|
15,448
|
|
|
16,267
|
Noncontrolling interest in consolidated subsidiaries
|
|
|
32
|
|
|
31
|
Total shareholders’ equity
|
|
|
15,480
|
|
|
16,298
|
Total liabilities and shareholders’ equity
|
|
|
$
|
30,248
|
|
|
$
|
32,240
|
|
|
|
(a)
|
|
Assets held for sale primarily includes inventory; property, plant,
and equipment; and allocated goodwill.
|
|
|
|
(b)
|
|
Includes $54 million of investments in fixed income securities at
September 30, 2015, and $56 million of investments in fixed income
securities at December 31, 2014.
|
|
|
|
(c)
|
|
Includes $35 million of investments in fixed income securities at
September 30, 2015, and $47 million of investments in fixed income
securities at December 31, 2014.
|
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Condensed Consolidated Statements of Cash Flows
(Millions of dollars)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
September 30
|
|
|
|
2015
|
|
|
2014
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net income (loss)
|
|
|
$
|
(641
|
)
|
|
|
$
|
2,596
|
|
Adjustments to reconcile net income to net cash flows from operating
activities:
|
|
|
|
|
|
|
Depreciation, depletion, and amortization
|
|
|
1,433
|
|
|
|
1,569
|
|
Impairments and other charges, net of tax
|
|
|
1,338
|
|
|
|
-
|
|
Working capital (a)
|
|
|
904
|
|
|
|
(1,005
|
)
|
Payment related to the Macondo well incident
|
|
|
(333
|
)
|
|
|
-
|
|
Other
|
|
|
(680
|
)
|
|
|
(247
|
)
|
Total cash flows from operating activities
|
|
|
2,021
|
|
|
|
2,913
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
Capital expenditures
|
|
|
(1,748
|
)
|
|
|
(2,284
|
)
|
Other investing activities
|
|
|
24
|
|
|
|
(48
|
)
|
Total cash flows from investing activities
|
|
|
(1,724
|
)
|
|
|
(2,332
|
)
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Dividends to shareholders
|
|
|
(460
|
)
|
|
|
(381
|
)
|
Payments to reacquire common stock
|
|
|
-
|
|
|
|
(800
|
)
|
Other financing activities
|
|
|
138
|
|
|
|
311
|
|
Total cash flows from financing activities
|
|
|
(322
|
)
|
|
|
(870
|
)
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
(17
|
)
|
|
|
(38
|
)
|
Decrease in cash and equivalents
|
|
|
(42
|
)
|
|
|
(327
|
)
|
Cash and equivalents at beginning of period
|
|
|
2,291
|
|
|
|
2,356
|
|
Cash and equivalents at end of period
|
|
|
$
|
2,249
|
|
|
|
$
|
2,029
|
|
(a) Working capital includes receivables, inventories and accounts
payable.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Revenue and Operating Income Comparison
By Segment and Geographic Region
(Millions of dollars)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
September 30
|
|
|
June 30
|
Revenue by geographic region:
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
Completion and Production:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
$
|
1,898
|
|
|
|
$
|
3,705
|
|
|
$
|
2,062
|
|
Latin America
|
|
|
336
|
|
|
|
435
|
|
|
337
|
|
Europe/Africa/CIS
|
|
|
518
|
|
|
|
699
|
|
|
554
|
|
Middle East/Asia
|
|
|
448
|
|
|
|
581
|
|
|
491
|
|
Total
|
|
|
3,200
|
|
|
|
5,420
|
|
|
3,444
|
|
Drilling and Evaluation:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
590
|
|
|
|
1,019
|
|
|
609
|
|
Latin America
|
|
|
403
|
|
|
|
610
|
|
|
430
|
|
Europe/Africa/CIS
|
|
|
503
|
|
|
|
765
|
|
|
541
|
|
Middle East/Asia
|
|
|
886
|
|
|
|
887
|
|
|
895
|
|
Total
|
|
|
2,382
|
|
|
|
3,281
|
|
|
2,475
|
|
Total revenue by region:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
2,488
|
|
|
|
4,724
|
|
|
2,671
|
|
Latin America
|
|
|
739
|
|
|
|
1,045
|
|
|
767
|
|
Europe/Africa/CIS
|
|
|
1,021
|
|
|
|
1,464
|
|
|
1,095
|
|
Middle East/Asia
|
|
|
1,334
|
|
|
|
1,468
|
|
|
1,386
|
|
Total revenue
|
|
|
$
|
5,582
|
|
|
|
$
|
8,701
|
|
|
$
|
5,919
|
|
|
|
|
|
|
|
|
|
|
|
Operating income by geographic region:
|
|
|
|
|
|
|
|
|
|
Completion and Production:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
$
|
(49
|
)
|
|
|
$
|
765
|
|
|
$
|
73
|
|
Latin America
|
|
|
53
|
|
|
|
65
|
|
|
55
|
|
Europe/Africa/CIS
|
|
|
77
|
|
|
|
126
|
|
|
90
|
|
Middle East/Asia
|
|
|
82
|
|
|
|
115
|
|
|
95
|
|
Total
|
|
|
163
|
|
|
|
1,071
|
|
|
313
|
|
Drilling and Evaluation:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
57
|
|
|
|
141
|
|
|
57
|
|
Latin America
|
|
|
55
|
|
|
|
73
|
|
|
57
|
|
Europe/Africa/CIS
|
|
|
73
|
|
|
|
90
|
|
|
74
|
|
Middle East/Asia
|
|
|
216
|
|
|
|
147
|
|
|
212
|
|
Total
|
|
|
401
|
|
|
|
451
|
|
|
400
|
|
Total operating income by region:
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
8
|
|
|
|
906
|
|
|
130
|
|
Latin America
|
|
|
108
|
|
|
|
138
|
|
|
112
|
|
Europe/Africa/CIS
|
|
|
150
|
|
|
|
216
|
|
|
164
|
|
Middle East/Asia
|
|
|
298
|
|
|
|
262
|
|
|
307
|
|
Corporate and other
|
|
|
(58
|
)
|
|
|
112
|
|
|
(70
|
)
|
Impairments and other charges
|
|
|
(381
|
)
|
|
|
-
|
|
|
(306
|
)
|
Baker Hughes acquisition-related costs
|
|
|
(82
|
)
|
|
|
-
|
|
|
(83
|
)
|
Total operating income
|
|
|
$
|
43
|
|
|
|
$
|
1,634
|
|
|
$
|
254
|
|
|
|
|
|
|
|
|
|
|
|
See Footnote Table 1 for Reconciliation of As Reported Operating
Income to Adjusted Operating Income.
|
|
|
|
|
|
|
HALLIBURTON COMPANY
Revenue and Operating Income Comparison
By Segment and Geographic Region
(Millions of dollars)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30
|
Revenue by geographic region:
|
|
|
2015
|
|
|
|
2014
|
Completion and Production:
|
|
|
|
|
|
|
|
|
North America
|
|
|
$
|
6,737
|
|
|
|
$
|
9,957
|
|
Latin America
|
|
|
1,067
|
|
|
|
1,185
|
|
Europe/Africa/CIS
|
|
|
1,600
|
|
|
|
1,940
|
|
Middle East/Asia
|
|
|
1,486
|
|
|
|
1,700
|
|
Total
|
|
|
10,890
|
|
|
|
14,782
|
|
Drilling and Evaluation:
|
|
|
|
|
|
|
|
|
North America
|
|
|
1,964
|
|
|
|
3,012
|
|
Latin America
|
|
|
1,388
|
|
|
|
1,616
|
|
Europe/Africa/CIS
|
|
|
1,613
|
|
|
|
2,204
|
|
Middle East/Asia
|
|
|
2,696
|
|
|
|
2,486
|
|
Total
|
|
|
7,661
|
|
|
|
9,318
|
|
Total revenue by region:
|
|
|
|
|
|
|
|
|
North America
|
|
|
8,701
|
|
|
|
12,969
|
|
Latin America
|
|
|
2,455
|
|
|
|
2,801
|
|
Europe/Africa/CIS
|
|
|
3,213
|
|
|
|
4,144
|
|
Middle East/Asia
|
|
|
4,182
|
|
|
|
4,186
|
|
Total revenue
|
|
|
$
|
18,551
|
|
|
|
$
|
24,100
|
|
|
|
|
|
|
|
|
|
|
Operating income by geographic region:
|
|
|
|
|
|
|
|
|
Completion and Production:
|
|
|
|
|
|
|
|
|
North America
|
|
|
$
|
258
|
|
|
|
$
|
1,841
|
|
Latin America
|
|
|
173
|
|
|
|
161
|
|
Europe/Africa/CIS
|
|
|
222
|
|
|
|
300
|
|
Middle East/Asia
|
|
|
285
|
|
|
|
317
|
|
Total
|
|
|
938
|
|
|
|
2,619
|
|
Drilling and Evaluation:
|
|
|
|
|
|
|
|
|
North America
|
|
|
159
|
|
|
|
457
|
|
Latin America
|
|
|
169
|
|
|
|
138
|
|
Europe/Africa/CIS
|
|
|
178
|
|
|
|
248
|
|
Middle East/Asia
|
|
|
601
|
|
|
|
420
|
|
Total
|
|
|
1,107
|
|
|
|
1,263
|
|
Total operating income by region:
|
|
|
|
|
|
|
|
|
North America
|
|
|
417
|
|
|
|
2,298
|
|
Latin America
|
|
|
342
|
|
|
|
299
|
|
Europe/Africa/CIS
|
|
|
400
|
|
|
|
548
|
|
Middle East/Asia
|
|
|
886
|
|
|
|
737
|
|
Corporate and other
|
|
|
(198
|
)
|
|
|
(84
|
)
|
Impairments and other charges
|
|
|
(1,895
|
)
|
|
|
-
|
|
Baker Hughes acquisition-related costs
|
|
|
(203
|
)
|
|
|
-
|
|
Total operating income (loss)
|
|
|
$
|
(251
|
)
|
|
|
$
|
3,798
|
|
|
FOOTNOTE TABLE 1
HALLIBURTON COMPANY
Reconciliation of As Reported Operating Income to Adjusted
Operating Income
(Millions of dollars)
(Unaudited)
|
|
|
|
Three Months Ended
|
|
|
|
September 30, 2015
|
|
|
September 30, 2014
|
|
|
June 30, 2015
|
As reported operating income
|
|
|
$
|
43
|
|
|
|
$
|
1,634
|
|
|
|
$
|
254
|
Impairments and other charges
|
|
|
381
|
|
|
|
-
|
|
|
|
306
|
Baker Hughes acquisition-related costs
|
|
|
82
|
|
|
|
-
|
|
|
|
83
|
Activity related to the Macondo well incident
|
|
|
|
-
|
|
|
|
|
(195
|
)
|
|
|
|
-
|
Adjusted operating income (a)
|
|
|
$
|
506
|
|
|
|
$
|
1,439
|
|
|
|
$
|
643
|
|
|
|
(a)
|
|
Management believes that operating income adjusted for impairments
and other charges and Baker Hughes acquisition-related costs for
the quarters ended September 30, 2015 and June 30, 2015, and
activity related to the Macondo well incident for the quarter
ended September 30, 2014 is useful to investors to assess and
understand operating performance, especially when comparing those
results with previous and subsequent periods or forecasting
performance for future periods, primarily because management views
the excluded items to be outside of the company's normal operating
results. Management analyzes operating income without the impact
of these items as an indicator of performance, to identify
underlying trends in the business, and to establish operational
goals. The adjustments remove the effects of these items. Adjusted
operating income is calculated as: “As reported operating income”
plus "Impairments and other charges" and "Baker Hughes
acquisition-related costs" for the quarters ended September 30,
2015 and June 30, 2015, and "As reported operating income" less
"Activity related to the Macondo well incident" for the quarter
ended September 30, 2014.
|
|
|
|
|
FOOTNOTE TABLE 2
HALLIBURTON COMPANY
Reconciliation of As Reported Income (Loss) from Continuing
Operations to
Adjusted Income from Continuing Operations
(Millions of dollars and shares except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
September 30, 2015
|
|
|
June 30, 2015
|
As reported income (loss) from continuing operations attributable to
company
|
|
|
$
|
(54
|
)
|
|
|
$
|
55
|
Impairments and other charges, net of tax (a)
|
|
|
257
|
|
|
|
258
|
Baker Hughes acquisition-related costs, net of tax (a)
|
|
|
62
|
|
|
|
67
|
Adjusted income from continuing operations attributable to company
(a)
|
|
|
$
|
265
|
|
|
|
$
|
380
|
|
|
|
|
|
|
|
As reported diluted weighted average common shares outstanding (b)
|
|
|
855
|
|
|
|
854
|
Adjusted diluted weighted average common shares outstanding (b)
|
|
|
857
|
|
|
|
854
|
|
|
|
|
|
|
|
As reported income (loss) from continuing operations per diluted
share (c)
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
0.06
|
Adjusted income from continuing operations per diluted share (c)
|
|
|
$
|
0.31
|
|
|
|
$
|
0.44
|
|
|
|
(a)
|
|
Management believes that income (loss) from continuing operations
adjusted for impairments and other charges and Baker Hughes
acquisition-related costs is useful to investors to assess and
understand operating performance, especially when comparing those
results with previous and subsequent periods or forecasting
performance for future periods, primarily because management views
the excluded items to be outside of the company's normal operating
results. Management analyzes income from continuing operations
without the impact of these items as an indicator of performance,
to identify underlying trends in the business, and to establish
operational goals. The adjustments remove the effects of these
items. Adjusted income from continuing operations attributable to
company is calculated as: “As reported income (loss) from
continuing operations attributable to company” plus "Impairments
and other charges, net of tax" and "Baker Hughes
acquisition-related costs, net of tax."
|
|
|
|
(b)
|
|
As reported diluted weighted average common shares outstanding for
the three months ended September 30, 2015 excludes options to
purchase two million shares of common stock as their impact would be
antidilutive since our reported income from continuing operations
attributable to company was in a loss position during that period.
When adjusting income from continuing operations attributable to
company for the special items discussed above, these two million
shares become dilutive.
|
|
|
|
(c)
|
|
Adjusted income from continuing operations per diluted share is
calculated as: "Adjusted income from continuing operations
attributable to company" divided by "Adjusted diluted weighted
average common shares outstanding." As reported income (loss) from
continuing operations per diluted share is calculated as: "As
reported income (loss) from continuing operations attributable to
company" divided by "As reported diluted weighted average common
shares outstanding."
|
|
|
|
Conference Call Details
Halliburton will host a conference call on Monday, October 19, 2015, to
discuss the third quarter 2015 financial results. The call will begin at
8:00 AM Central Time (9:00 AM Eastern Time).
Please visit the website to listen to the call live via webcast.
Interested parties may also participate in the call by dialing (866)
804-3547 within North America or (703) 639-1328 outside North America. A
passcode is not required. Attendees should log in to the webcast or dial
in approximately 15 minutes prior to the call’s start time.
A replay of the conference call will be available on Halliburton’s
website for seven days following the call. Also, a replay may be
accessed by telephone at (888) 266-2081 within North America or (703)
925-2533 outside of North America, using the passcode 1661520.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151019005456/en/ Copyright Business Wire 2015
Source: Business Wire
(October 19, 2015 - 6:50 AM EDT)
News by QuoteMedia
www.quotemedia.com
|