$0.13 per diluted share, excluding severance and investigation
costs GENEVA, Oct. 19 /PRNewswire-FirstCall/ -- Weatherford
International Ltd. (NYSE:WFT) today reported third quarter 2009
income from continuing operations of $93 million, or $0.13 per
diluted share, excluding an after tax loss of $0.02 for
investigation and exit costs incurred in connection with the
company's withdrawal from sanctioned countries and severance costs
principally associated with restructuring activities. Third quarter
diluted earnings per share from continuing operations reflect a
decrease of 76 percent over the third quarter of 2008 diluted
earnings per share from continuing operations of $0.55, before
severance and investigation costs. Results for the third quarter
include a tax benefit of approximately $0.05 resulting from the
lowering of the company's estimate of its effective tax rate, as
well as a negative $0.02 impact from higher losses on foreign
currency remeasurement and the settlement of a legal dispute. In
addition, third quarter results include a gain of $27 million
recorded pursuant to Statement of Financial Accounting Standards
No. 141(R), Business Combinations, in connection with the
revaluation of contingent consideration associated with an
acquisition. This financial item was mostly offset by other
adjustments going both ways. (Logo:
http://www.newscom.com/cgi-bin/prnh/19990308/WEATHERFORDLOGO) Third
quarter revenues were $2,150 million, or 15 percent lower than the
same period last year, against a backdrop of a 39 percent decrease
in global rig count. North America was primarily responsible for
the decline, with revenues decreasing 47 percent against a 52
percent decline in rig count. International revenues were up 12
percent against an 11 percent decrease in international rig count.
Sequentially, the company's third quarter diluted earnings per
share from continuing operations, before severance and
investigation costs, were $0.03 higher than the second quarter of
2009 diluted earnings per share from continuing operations of
$0.10, before severance and investigation costs. North America
Revenues for the quarter were $620 million, which is a 47 percent
decrease over the same quarter in the prior year, as compared to a
52 percent rig count decrease. Sequentially, revenues were up nine
percent as compared to a 13 percent rig count increase. Operating
income was $33 million, which is down $280 million compared to the
same quarter in the prior year and up $34 million sequentially. The
sequential increase was mainly attributable to the seasonal
recovery in Canada. Middle East/North Africa/Asia Third quarter
revenues of $600 million were six percent lower than the third
quarter of 2008 and one percent higher than the prior quarter. On a
sequential basis, strong performances were posted in Saudi Arabia,
Qatar, China and Australia. The current quarter's operating income
of $102 million decreased 30 percent as compared to the same
quarter in the prior year and decreased 17 percent as compared to
the prior quarter due to the combined impact of delayed project
start ups and product deliveries, as well as lower pricing. Latin
America Third quarter revenues of $525 million were 67 percent
higher than the third quarter of 2008 and 13 percent higher than
the prior quarter despite weather issues and reduced gas activity
in Mexico. On average, we operated 45 strings in Mexico, up from an
average of 33 strings last quarter. Those rigs that were unaffected
by weather ran more efficiently than the prior quarter. Fourteen of
our strings operate in the central and northern part of the
Chicontepec field which suffered from flooding during the current
quarter. The current quarter's operating income of $54 million
declined 22 percent as compared to the same quarter in the prior
year. Sequentially, operating income declined 37 percent due to
pricing declines as well as the negative impact of fixed costs
incurred on rigs made idle during the flooding in Mexico.
Europe/West Africa/FSU Third quarter revenues of $404 million were
one percent lower than the third quarter of 2008 and 11 percent
higher than the prior quarter. The sequential increase was driven
primarily by our acquisition of TNK-BP's oilfield service business
during the third quarter. This increase was offset by declines in
activity in Europe. The current quarter's operating income of $72
million declined 30 percent as compared to the same quarter in the
prior year and increased 15 percent sequentially. Reclassifications
and Non-GAAP Non-GAAP performance measures and corresponding
reconciliations to GAAP financial measures have been provided for
meaningful comparisons between current results and results in prior
operating periods. Conference Call The company will host a
conference call with financial analysts to discuss the 2009 third
quarter results on October 19, 2009 at 7:30 a.m. (CDT). The company
invites investors to listen to a play back of the conference call
at the company's website, http://www.weatherford.com/ in the
"investor relations" section. Weatherford is a Swiss-based,
multi-national oilfield service company. It is one of the largest
global providers of innovative mechanical solutions, technology and
services for the drilling and production sectors of the oil and gas
industry. Weatherford operates in over 100 countries and employs
over 52,000 people worldwide. Contacts: Andrew P. Becnel
+41.22.816.1502 Chief Financial Officer Nicholas W. Gee
+41.22.816.1510 Group Vice President- Marketing & Planning This
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
concerning, among other things, Weatherford's prospects for its
operations which are subject to certain risks, uncertainties and
assumptions. These risks and uncertainties, which are more fully
described in Weatherford International Ltd.'s reports and
registration statements filed with the SEC, include the impact of
oil and natural gas prices and worldwide economic conditions on
drilling activity, the outcome of pending government
investigations, the demand for and pricing of Weatherford's
products and services, domestic and international economic and
regulatory conditions and changes in tax and other laws affecting
our business. Should one or more of these risks or uncertainties
materialize, or should the assumptions prove incorrect, actual
results may vary materially from those currently anticipated.
Weatherford International Ltd. Consolidated Condensed Statements of
Income (Unaudited) (In 000's, Except Per Share Amounts) Three
Months Nine Months Ended September 30, Ended September 30,
-------------------- -------------------- 2009 2008 2009 2008 ----
---- ---- ---- Net Revenues: North America $620,496 $1,179,605
$2,029,264 $3,282,211 Middle East/ North Africa/ Asia 600,110
637,872 1,774,964 1,716,007 Europe/West Africa/FSU 404,390 408,993
1,138,201 1,146,185 Latin America 524,883 314,326 1,458,423 821,535
------- ------- --------- ------- 2,149,879 2,540,796 6,400,852
6,965,938 --------- --------- --------- --------- Operating Income
(Expense): North America 33,259 312,887 155,586 828,792 Middle
East/ North Africa/ Asia 101,943 146,450 359,522 397,774
Europe/West Africa/FSU 71,836 102,385 209,393 294,614 Latin America
54,343 69,521 232,319 188,374 Research and Development (49,300)
(52,026) (144,434) (139,095) Corporate Expenses (44,272) (30,750)
(124,705) (99,657) Exit and Restructuring (17,887) (13,727)
(73,669) (23,604) ------- ------- ------- ------- 149,922 534,740
614,012 1,447,198 Other Income (Expense): Interest Expense, Net
(90,285) (60,521) (274,846) (175,723) Other, Net (11,046) (8,243)
(28,456) (13,026) ------- ------ ------- ------- Income from
Continuing Operations Before Income Taxes 48,591 465,976 310,710
1,258,449 Benefit (Provision) for Income Taxes: Benefit (Provision)
for Operations 31,766 (82,990) (12,867) (221,796) Benefit From Exit
and Restructuring 2,603 - 9,332 7,306 ----- --- ----- ----- 34,369
(82,990) (3,535) (214,490) Income from Continuing Operations, Net
of Taxes 82,960 382,986 307,175 1,043,959 Gain (Loss) from
Discontinued Operation, Net of Taxes - - - (12,928) --- --- ---
------- Net Income 82,960 382,986 307,175 1,031,031 Net Income
Attributable to Noncontrolling Interest (5,586) (12,386) (23,018)
(25,246) ------ ------- ------- ------- Net Income Attributable to
Weatherford $77,374 $370,600 $284,157 $1,005,785 ======= ========
======== ========== Basic Earnings Per Share Attributable to
Weatherford: Income from Continuing Operations $0.11 $0.54 $0.40
$1.49 Gain (Loss) from Discontinued Operation - - - (0.01) --- ---
--- ----- Net Income $0.11 $0.54 $0.40 $1.48 ===== ===== =====
===== Diluted Earnings Per Share Attributable to Weatherford:
Income from Continuing Operations $0.11 $0.53 $0.40 $1.46 Gain
(Loss) from Discontinued Operation - - - (0.02) --- --- --- -----
Net Income $0.11 $0.53 $0.40 $1.44 ===== ===== ===== ===== Amounts
Attributable to Weatherford Common Shareholders: Income from
Continuing Operations, Net of Taxes $77,374 $370,600 $284,157
$1,018,713 Gain (Loss) from Discontinued Operation, Net of Taxes -
- - (12,928) --- --- --- ------- Net Income $77,374 $370,600
$284,157 $1,005,785 ======= ======== ======== ========== Weighted
Average Shares Outstanding: Basic 724,114 682,532 707,621 681,531
Diluted 735,109 701,284 715,719 700,099 Weatherford International
Ltd. Selected Income Statement Information (Unaudited) (In 000's)
Three Months Ended ----- 9/30/2009 6/30/2009 3/31/2009 12/31/2008
9/30/2008 --------- --------- --------- ---------- --------- Net
Revenues: North America $620,496 $571,415 $837,353 $1,177,936
$1,179,605 Middle East/ North Africa/ Asia 600,110 592,908 581,946
675,513 637,872 Europe/West Africa/FSU 404,390 364,968 368,843
393,005 408,993 Latin America 524,883 465,541 467,999 388,172
314,326 ------- ------- ------- ------- ------- $2,149,879
$1,994,832 $2,256,141 $2,634,626 $2,540,796 ========== ==========
========== ========== ========== Operating Income (Expense): North
America $33,259 $(709) $123,036 $296,407 $312,887 Middle East/
North Africa/ Asia 101,943 123,553 134,026 163,238 146,450
Europe/West Africa/FSU 71,836 62,614 74,943 88,158 102,385 Latin
America 54,343 85,759 92,217 88,720 69,521 Research and Development
(49,300) (46,113) (49,021) (53,564) (52,026) Corporate Expenses
(44,272) (40,834) (39,599) (35,355) (30,750) Exit and Restructuring
(17,887) (30,905) (24,877) (16,253) (13,727) ------- -------
------- ------- ------- $149,922 $153,365 $310,725 $531,351
$534,740 ======== ======== ======== ======== ======== Supplemental
Information (Unaudited) (In 000's) Three Months Ended -----
9/30/2009 6/30/2009 3/31/2009 12/31/2008 9/30/2008 ---------
--------- --------- ---------- --------- Depreciation and
Amortization: North America $79,737 $77,253 $75,098 $80,555 $79,619
Middle East/ North Africa/ Asia 65,771 60,921 57,634 55,587 49,138
Europe/West Africa/FSU 44,864 35,190 34,678 33,825 31,911 Latin
America 43,403 35,971 30,442 30,331 23,561 Research and Development
1,940 2,017 1,933 1,931 1,902 Corporate 2,194 2,341 1,609 1,449
1,000 ----- ----- ----- ----- ----- $237,909 $213,693 $201,394
$203,678 $187,131 ======== ======== ======== ======== ======== We
report our financial results in accordance with generally accepted
accounting principles (GAAP). However, Weatherford's management
believes that certain non-GAAP performance measures and ratios may
provide users of this financial information additional meaningful
comparisons between current results and results in prior operating
periods. One such non- GAAP financial measure we may present from
time to time is operating income or income from continuing
operations excluding certain charges or amounts. This adjusted
income amount is not a measure of financial performance under GAAP.
Accordingly, it should not be considered as a substitute for
operating income, net income or other income data prepared in
accordance with GAAP. See the table below for supplemental
financial data and corresponding reconciliations to GAAP financial
measures for the three months ended September 30, 2009, June 30,
2009, and September 30, 2008 and for the nine months ended
September 30, 2009 and September 30, 2008. Non-GAAP financial
measures should be viewed in addition to, and not as an alternative
for, the Company's reported results prepared in accordance with
GAAP. Weatherford International Ltd. Reconciliation of GAAP to
Non-GAAP Financial Measures (Unaudited) (In thousands, except per
share data) Three Months Ended Nine Months Ended ------------------
----------------- Sept. 30, June 30, Sept. 30, Sept. 30, Sept. 30,
2009 2009 2008 2009 2008 ---- ---- ---- ---- ---- Operating Income:
GAAP Operating Income $149,922 $153,365 $534,740 $614,012
$1,447,198 Exit and Restructuring 17,887(a) 30,905(b) 13,727(c)
73,669(d) 23,604(e) ------ ------ ------ ------ ------ Non-GAAP
Operating Income $167,809 $184,270 $548,467 $687,681 $1,470,802
======== ======== ======== ======== ========== Benefit (Provision)
For Income Taxes: GAAP Benefit (Provision) For Income Taxes $34,369
$(5,441) $(82,990) $(3,535) $(214,490) Tax Impact of Exit and
Restructuring (2,603)(a) (3,388)(b) -(c) (9,332)(d) (7,306)(e)
------ ------ ------ ------ ------ Non-GAAP Benefit (Provision) for
Income Taxes $31,766 $(8,829) $(82,990) $(12,867) $(221,796)
======= ======= ======== ======== ========= Income from Continuing
Operations Attributable to Weatherford: GAAP Income from Continuing
Operations $77,374 $41,981 $370,600 $284,157 $1,018,713 Total Exit
and Restructuring, net of tax 15,284(a) 27,517(b) 13,727(c)
64,337(d) 16,298(e) ------ ------ ------ ------ ------ Non-GAAP
Income from Continuing Operations $92,658 $69,498 $384,327 $348,494
$1,035,011 ======= ======= ======== ======== ========== Diluted
Earnings Per Share From Continuing Operations Attributable to
Weatherford: GAAP Diluted Earnings per Share From $0.11 $0.06 $0.53
$0.40 $1.46 Continuing Operations Total Exit and Restructuring, net
of tax 0.02(a) 0.04(b) 0.02(c) 0.09(d) 0.02(e) ---- ---- ---- ----
---- Non-GAAP Diluted Earnings per Share From Continuing Operations
$0.13 $0.10 $0.55 $0.49 $1.48 ===== ===== ===== ===== ===== Note
(a): This amount represents investigation costs incurred in
connection with on-going investigations by the U.S. government.
Also included are severance charges and facility closure costs
associated with the Company's reorganization activities. Note (b):
This amount represents investigation costs incurred in connection
with on-going investigations by the U.S. government and costs
related to the Company's withdrawal from sanctioned countries. Also
included are severance charges associated with the Company's
reorganization activities. Note (c): This amount represents
investigation costs incurred in connection with on-going
investigations by the U.S. government and costs related to the
Company's withdrawal from sanctioned countries. Note (d): This
amount represents investigation costs incurred in connection with
on-going investigations by the U.S. government and costs related to
the Company's withdrawal from sanctioned countries. Also included
are severance charges and facility closure costs associated with
the Company's reorganization activities. Note (e): This amount
represents investigation costs incurred in connection with on-going
investigations by the U.S. government and costs related to the
Company's withdrawal from sanctioned countries, partially offset by
a gain on the restructuring of a Qatar operation into a JV.
http://www.newscom.com/cgi-bin/prnh/19990308/WEATHERFORDLOGO
http://photoarchive.ap.org/ DATASOURCE: Weatherford International
Ltd. CONTACT: Andrew P. Becnel, Chief Financial Officer,
+41.22.816.1502, or Nicholas W. Gee, Group Vice President-
Marketing & Planning, +41.22.816.1510, both of Weatherford Web
Site: http://www.weatherford.com/
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