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--Reported income from continuing operations of $0.65 per diluted share, including non-recurring items of a net $17 million, after tax, or $0.02 per diluted share
Halliburton (HAL) announced today that income from continuing
operations for the third quarter of 2012 was $625 million, or $0.67 per
diluted share, excluding a $30 million after-tax ($0.03 per diluted
share) acquisition-related charge and a $13 million after-tax ($0.01 per
diluted share) gain from the settlement of a patent infringement case.
Reported income from continuing operations for the third quarter of 2012
was $608 million, or $0.65 per diluted share. This compares to income
from continuing operations for the second quarter of 2012 of $745
million, or $0.80 per diluted share.
Halliburton’s consolidated revenue in the third quarter of 2012 was $7.1
billion, compared to $7.2 billion in the second quarter of 2012.
Consolidated operating income was $954 million in the third quarter of
2012, compared to $1.2 billion in the second quarter of 2012. Lower
activity and higher costs in the United States land market drove these
declines.
"I am pleased with the strengthening of our market position in key
international geographies and in product lines where we envision strong
growth in the coming years," commented Dave Lesar, chairman, president
and chief executive officer.
"We believe our international strategy is playing out as planned, as
evidenced by our third quarter record revenue for both the Latin America
and the Middle East/Asia regions. From a global perspective, our
Drilling & Evaluation division posted record revenue for the quarter. We
also achieved third quarter record revenue in four of our product
service lines - Boots & Coots, Wireline and Perforating, Consulting and
Project Management, and Baroid, which also had a record quarter for
operating income.
"Consolidated third quarter revenue of $7.1 billion was down 2%
sequentially, driven by a 5% reduction in our North America revenue. On
an adjusted basis, total operating income of $982 million decreased 18%
sequentially, primarily due to pricing pressure and guar cost issues in
our North America Production Enhancement business.
"International revenue was up 2% from the second quarter, compared to a
2% rig count decline, as a result of solid sequential growth in our
Latin America and Middle East/Asia regions. Adjusted international
operating income was up 5% sequentially due to strong activity
improvements in key geographies such as Mexico, Brazil, Russia,
Malaysia, and Australia.
"In Latin America, revenue was up 8% sequentially, despite a 5% drop in
the rig count. Adjusted operating income increased 12% sequentially, led
by excellent performance in Mexico and Brazil. We saw a significant
increase in unconventional activity across Latin America during the
quarter, and we expect margins to improve in the fourth quarter, aided
by end of year software sales.
"In the Eastern Hemisphere, revenue has grown 19% and adjusted operating
income has grown almost 70% compared to the third quarter of last year,
relative to rig count growth of 5%, after normalizing for the recent
addition of Iraq. We continue to see steady margin improvement and are
optimistic about activity levels expanding in the fourth quarter and in
the coming year.
"Middle East/Asia posted higher sequential revenue and operating income
of 3% and 9%, respectively, while the rig count contracted 3%. These
increases were driven by strong activity improvements this quarter in
Malaysia and Australia and improved profitability in Iraq.
"In Europe/Africa/CIS, we saw a slight decline in revenue and operating
income in the third quarter, largely resulting from activity delays in
the North Sea, shutdowns related to general elections in Angola, and
reduced activity in Algeria and across continental Europe. Relative to
the third quarter of 2011, revenue grew 14% and adjusted operating
income grew 66% as we focused on repairing underperforming markets.
"Overall, our outlook for the international market has not changed, and
we expect a gradual progression in margins as we ramp up activity on
recent wins and new projects, introduce new technologies, increase
pricing on select contracts, and continue to improve results in those
markets where we have made strategic investments.
"In North America, revenue was down 5% and operating income was down,
driven mainly by pricing pressure in hydraulic fracturing, guar cost
inflation, and activity disruptions due to Hurricane Isaac. We are also
seeing activity reductions by some of our customers as they continue to
moderate activity to operate within their stated 2012 budgets.
"The average U.S. land rig count declined 68 rigs, or approximately 4%,
sequentially. Although the oil-directed rig count grew by 44 rigs, or
3%, this was not sufficient to offset the 18% drop in natural gas rigs.
While the Canadian rig count increased 84% sequentially coming out of
spring break-up, the increase was well below normal, averaging only 325
rigs in the third quarter. Relative to the third quarter of 2011, the
U.S. rig count is down 38 rigs, or 2%, and Canada is down a
disappointing 116 rigs, or 26%.
"We continue to be confident in the long-term fundamentals of our
business, and our growth strategy going forward remains unchanged. We
will continue to focus on maintaining our leadership position in North
America, strengthening our international margins, and continuing to grow
our market share in deepwater, global unconventionals, and underserved
international markets," concluded Lesar.
2012 Third Quarter Results
Completion and Production
Completion and Production (C&P) revenue in the third quarter of 2012 was
$4.3 billion, a decrease of $167 million, or 4%, from the second quarter
of 2012. The decrease was driven by pricing pressure and reduced
activity in the North America region.
C&P operating income in the third quarter of 2012 was $591 million, a
decrease of $323 million, or 35%, from the second quarter of 2012.
Excluding the impact of the acquisition-related charge, C&P operating
income decreased $275 million, or 30%, from the second quarter of 2012.
North America C&P operating income, adjusted for the acquisition-related
charge, decreased $268 million, or 39%, from the second quarter of 2012,
primarily due to pricing pressure and increased costs for production
enhancement services. Excluding the acquisition-related charge, Latin
America C&P operating income decreased $6 million, or 11%, from the
second quarter of 2012, driven by reduced profitability in Argentina and
Venezuela. Europe/Africa/CIS C&P operating income decreased $7 million,
or 7%, from the second quarter of 2012, as a result of lower activity in
the North Sea and Angola. Middle East/Asia C&P operating income
increased $6 million, or 8%, compared to the second quarter of 2012.
This improvement was primarily attributable to higher production
enhancement activity in Australia and completion tools sales in Malaysia.
Drilling and Evaluation
Drilling and Evaluation (D&E) revenue in the third quarter of 2012 was
$2.8 billion, an increase of $44 million, or 2%, from the second quarter
of 2012, driven by strong results in Latin America and the Middle
East/Asia region.
D&E operating income in the third quarter of 2012 was $430 million, an
increase of $37 million, or 9%, from the second quarter of 2012. North
America D&E operating income rose 5% compared to the second quarter of
2012, due to higher drilling activity in Canada and wireline activity
throughout the region. Latin America D&E operating income increased $22
million, or 26%, from the second quarter of 2012, primarily due to
improved activity levels in Mexico. Europe/Africa/CIS D&E operating
income was essentially flat compared to the second quarter of 2012, as
increased fluids demand in Norway and Russia was offset by reduced
activity in Kazakhstan, Algeria and continental Europe. Middle East/Asia
D&E operating income increased $8 million, or 10%, from the second
quarter of 2012, primarily due to higher drilling, wireline, and testing
activity in Malaysia and increased directional drilling and wireline
activity in Saudi Arabia, which were partially offset by lower direct
sales in China.
Corporate and Other
During the third quarter of 2012, Halliburton invested an additional $32
million, pre-tax, in strategic projects aimed at strengthening
Halliburton’s North America service delivery model and repositioning
technology, supply chain, and manufacturing infrastructure to support
projected international growth. Halliburton expects to continue funding
this effort for the remainder of 2012 and into 2013.
Significant Recent Events and Achievements
--
Halliburton announced it has acquired Petris Technology Inc., a
leading supplier of data-management and integration solutions to the
global energy industry. The acquisition provides Landmark with a
unique capability to provide customers with unrivaled access to their
reservoir and technical well data, empowering their decision-making
processes by providing them with mission-critical data, where and when
they need it.
--
Halliburton’s Boots & Coots business line has enhanced its pressure
control offerings with the acquisition of Old School Services, LLC.
The acquisition gives Halliburton the resources to provide operators
with the through-tubing equipment required to resolve production
challenges faced by the rapidly growing unconventional, horizontal
drilling, and multistage completions markets.
--
Halliburton has opened its state-of-the-art Advanced Perforating Flow
Lab. The new facility expands Halliburton’s global perforating
research, development, and testing capabilities with leading-edge
technologies that simulate the most extreme real-world reservoir
conditions and provide customers with unique perforating solutions
that help optimize reservoir performance.
--
Halliburton has introduced its Knoesis(SM)service. This new
service provides a family of software applications for use by
Halliburton stimulation technical advisors to assist operators in
optimizing completion efficiency and asset development. The
applications provide improved knowledge of the reservoir and its
stimulation characteristics.
Founded in 1919, Halliburton is one of the world’s largest providers of
products and services to the energy industry. With over 70,000 employees
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 Web site at www.halliburton.com.
NOTE: The statements in this press release that are not historical
statements, including statements regarding future financial performance,
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: results of litigation, settlements, and
investigations; actions by third parties, including governmental
agencies; 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; indemnification and
insurance matters; 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, and 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; impairment of oil and natural gas properties;
structural changes in the oil and natural gas industry; maintaining a
highly skilled workforce; availability and cost of raw materials; and
integration of acquired businesses and operations of joint ventures.
Halliburton’s Form 10-K for the year ended December 31, 2011, Form 10-Q
for the quarter ended June 30, 2012, 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.
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
Three Months Ended
-----------------------------------------------------------
September 30 June 30
------------------------------------------ ----------------
2012 2011 2012
---------------------- ------------- -------------
Revenue:
Completion and Production $ 4,293 $ 4,025 $ 4,460
Drilling and Evaluation 2,818 2,523 2,774
-------------------------------------------------------------- -------------- ----- -----
Total revenue $ 7,111 $ 6,548 $ 7,234
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Operating income:
Completion and Production $ 591 $ 1,068 $ 914
Drilling and Evaluation 430 369 393
Corporate and other (67 ) (105 ) (106 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Total operating income 954 1,332 1,201
-------------------------------------------------------------- -------------- ----- -----
Interest expense, net (71 ) (62 ) (80 )
Other, net (6 ) (9 ) (17 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Income from continuing operations before income taxes 877 1,261 1,104
Provision for income taxes (267 ) (411 ) (357 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Income from continuing operations 610 850 747
Loss from discontinued operations, net (6 ) (165 )(a) (8 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Net income $ 604 $ 685 $ 739
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Noncontrolling interest in net income of subsidiaries (2 ) (2 ) (2 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Net income attributable to company $ 602 $ 683 $ 737
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Amounts attributable to company shareholders:
Income from continuing operations $ 608 $ 848 $ 745
Loss from discontinued operations, net (6 ) (165 )(a) (8 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Net income attributable to company $ 602 $ 683 $ 737
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Basic income per share attributable to company shareholders:
Income from continuing operations $ 0.66 $ 0.92 $ 0.81
Loss from discontinued operations, net (0.01 ) (0.18 ) (0.01 )
-------------------------------------------------------------- -------------- ---- ----- ---- ----- ----
Net income per share $ 0.65 $ 0.74 $ 0.80
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Diluted income per share attributable to company shareholders:
Income from continuing operations $ 0.65 $ 0.92 $ 0.80
Loss from discontinued operations, net - (0.18 ) (0.01 )
-------------------------------------------------------------- -------------- ----- ---- ----- ----
Net income per share $ 0.65 $ 0.74 $ 0.79
-------------------------------------------------------------- ---- -------------- ---- ----- ---- -----
Basic weighted average common shares outstanding 928 920 924
Diluted weighted average common shares outstanding 930 925 926
-------------------------------------------------------------- -------------- ----- -----
(a) Loss from discontinued operations, net, in the three months ended
September 30, 2011 includes, among other items, a
$163 million loss due to a ruling in an arbitration proceeding
between Barracuda & Caratinga Leasing Company B.V. and KBR,
whom Halliburton agreed to indemnify.
See Footnote Table 1 for a list of significant items included in
operating income.
See Footnote Table 3 for adjusted total operating income excluding
certain items.
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
Nine Months Ended September 30
-------------------------------------------
2012 2011
--------------------- ---------------------
Revenue:
Completion and Production $ 13,043 $ 10,815
Drilling and Evaluation 8,170 6,950
-------------------------------------------------------------- ------ ------
Total revenue $ 21,213 $ 17,765
-------------------------------------------------------------- ------ ------ ------ ------
Operating income:
Completion and Production $ 2,541 $ 2,646
Drilling and Evaluation 1,191 923
Corporate and other (554 )(a) (262 )
-------------------------------------------------------------- ------ ------ ------ ------
Total operating income 3,178 3,307
-------------------------------------------------------------- ------ ------
Interest expense, net (225 ) (194 )
Other, net (30 ) (18 )
-------------------------------------------------------------- ------ ------ ------ ------
Income from continuing operations before income taxes 2,923 3,095
Provision for income taxes (928 ) (992 )
-------------------------------------------------------------- ------ ------ ------ ------
Income from continuing operations 1,995 2,103
Loss from discontinued operations, net (22 ) (166 )(b)
-------------------------------------------------------------- ------ ------ ------ ------
Net income $ 1,973 $ 1,937
-------------------------------------------------------------- ------ ------ ------ ------
Noncontrolling interest in net income of subsidiaries (7 ) (4 )
-------------------------------------------------------------- ------ ------ ------ ------
Net income attributable to company $ 1,966 $ 1,933
-------------------------------------------------------------- ------ ------ ------ ------
Amounts attributable to company shareholders:
Income from continuing operations $ 1,988 $ 2,099
Loss from discontinued operations, net (22 ) (166 )(b)
-------------------------------------------------------------- ------ ------ ------ ------
Net income attributable to company $ 1,966 $ 1,933
-------------------------------------------------------------- ------ ------ ------ ------
Basic income per share attributable to company shareholders:
Income from continuing operations $ 2.15 $ 2.29
Loss from discontinued operations, net (0.02 ) (0.18 )
-------------------------------------------------------------- ------ ------ ------ ------
Net income per share $ 2.13 $ 2.11
-------------------------------------------------------------- ------ ------ ------ ------
Diluted income per share attributable to company shareholders:
Income from continuing operations $ 2.14 $ 2.28
Loss from discontinued operations, net (0.02 ) (0.18 )
-------------------------------------------------------------- ------ ------ ------ ------
Net income per share $ 2.12 $ 2.10
-------------------------------------------------------------- ------ ------ ------ ------
Basic weighted average common shares outstanding 925 917
Diluted weighted average common shares outstanding 927 922
-------------------------------------------------------------- ------ ------
(a) Includes, among other items, a $300 million, pre-tax, charge related
to the Macondo well incident.
(b) Loss from discontinued operations, net, in the nine months ended
September 30, 2011 includes, among other items, a
$163 million loss due to a ruling in an arbitration proceeding
between Barracuda & Caratinga Leasing Company B.V. and
KBR, whom Halliburton agreed to indemnify.
See Footnote Table 2 for a list of significant items included in
operating income.
HALLIBURTON COMPANY
Condensed Consolidated Balance Sheets
(Millions of dollars)
(Unaudited)
September 30 December 31
-------------------- --------------------
2012 2011
-------------------- --------------------
Assets
Current assets:
Cash and equivalents $ 2,032 $ 2,698
Receivables, net 5,870 5,084
Inventories 3,539 2,570
Other current assets 1,325 1,225
--------------------------------------------------------------------- --------- ---------
Total current assets 12,766 11,577
Property, plant, and equipment, net 9,678 8,492
Goodwill 2,075 1,776
Other assets 1,793 1,832
--------------------------------------------------------------------- --------- ---------
Total assets $ 26,312 $ 23,677
--------------------------------------------------------------------- --------- --------- --------- ---------
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable $ 2,136 $ 1,826
Accrued employee compensation and benefits 827 862
Other current liabilities 1,635 1,433
--------------------------------------------------------------------- --------- ---------
Total current liabilities 4,598 4,121
Long-term debt 4,820 4,820
Other liabilities 1,703 1,520
--------------------------------------------------------------------- --------- ---------
Total liabilities 11,121 10,461
Company shareholders’ equity 15,168 13,198
Noncontrolling interest in consolidated subsidiaries 23 18
--------------------------------------------------------------------- --------- ---------
Total shareholders’ equity 15,191 13,216
--------------------------------------------------------------------- --------- ---------
Total liabilities and shareholders’ equity $ 26,312 $ 23,677
--------------------------------------------------------------------- --------- --------- --------- ---------
HALLIBURTON COMPANY
Condensed Consolidated Statements of Cash Flows
(Millions of dollars)
(Unaudited)
Nine Months Ended
September 30
-------------------------------
2012 2011
--------------- ---------------
Cash flows from operating activities:
Net income $ 1,973 $ 1,937
Adjustments to reconcile net income to net cash flows from operating
activities:
Depreciation, depletion, and amortization 1,197 991
Loss contingency for Macondo well incident 300 -
Loss from discontinued operations, net 22 166
Other, primarily working capital (1,579 ) (728 )
-------------------------------------------------------------------- ------ - ------ -
Total cash flows from operating activities 1,913 2,366
-------------------------------------------------------------------- ------ ------
Cash flows from investing activities:
Capital expenditures (2,519 ) (2,164 )
Sales of marketable securities 250 751
Purchases of marketable securities (171 ) (501 )
Other (18 ) 36
-------------------------------------------------------------------- ------ - ------
Total cash flows from investing activities (2,458 ) (1,878 )
-------------------------------------------------------------------- ------ - ------ -
Cash flows from financing activities:
Dividends to shareholders (250 ) (247 )
Other 132 159
-------------------------------------------------------------------- ------ ------
Total cash flows from financing activities (118 ) (88 )
-------------------------------------------------------------------- ------ - ------ -
Effect of exchange rate changes on cash (3 ) (23 )
-------------------------------------------------------------------- ------ - ------ -
Increase (decrease) in cash and equivalents (666 ) 377
Cash and equivalents at beginning of period 2,698 1,398
-------------------------------------------------------------------- ------ ------
Cash and equivalents at end of period $ 2,032 $ 1,775
-------------------------------------------------------------------- ----- ------ ----- ------
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: 2012 2011 2012
-------------------------------------- -------------- -------------- --------------
Completion and Production:
North America $ 2,978 $ 2,950 $ 3,167
Latin America 373 297 340
Europe/Africa/CIS 523 433 551
Middle East/Asia 419 345 402
-------------------------------------- ----- ----- -----
Total 4,293 4,025 4,460
-------------------------------------- ----- ----- -----
Drilling and Evaluation:
North America 965 926 973
Latin America 579 509 539
Europe/Africa/CIS 605 558 605
Middle East/Asia 669 530 657
-------------------------------------- ----- ----- -----
Total 2,818 2,523 2,774
-------------------------------------- ----- ----- -----
Total revenue by region:
North America 3,943 3,876 4,140
Latin America 952 806 879
Europe/Africa/CIS 1,128 991 1,156
Middle East/Asia 1,088 875 1,059
-------------------------------------- ----- ----- -----
Operating income by geographic region:
--------------------------------------
Completion and Production:
North America $ 383 $ 960 $ 691
Latin America 40 43 54
Europe/Africa/CIS 88 15 95
Middle East/Asia 80 50 74
-------------------------------------- ----- ----- -----
Total 591 1,068 914
-------------------------------------- ----- ----- -----
Drilling and Evaluation:
North America 174 175 166
Latin America 106 94 84
Europe/Africa/CIS 63 51 64
Middle East/Asia 87 49 79
-------------------------------------- ----- ----- -----
Total 430 369 393
-------------------------------------- ----- ----- -----
Total operating income by region:
North America 557 1,135 857
Latin America 146 137 138
Europe/Africa/CIS 151 66 159
Middle East/Asia 167 99 153
-------------------------------------- ----- ----- -----
Corporate and other (67 ) (105 ) (106 )
-------------------------------------- ----- --- ----- --- ----- ---
Total operating income $ 954 $ 1,332 $ 1,201
-------------------------------------- --- ----- --- ----- --- -----
See Footnote Table 1 for a list of significant items included in
operating income.
See Footnote Table 3 for adjusted total operating income excluding
certain items.
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: 2012 2011
-------------------------------------- ------- -------
Completion and Production:
North America $ 9,327 $ 7,759
Latin America 1,019 805
Europe/Africa/CIS 1,530 1,249
Middle East/Asia 1,167 1,002
-------------------------------------- ------- -------
Total 13,043 10,815
-------------------------------------- ------- -------
Drilling and Evaluation:
North America 2,924 2,544
Latin America 1,592 1,300
Europe/Africa/CIS 1,766 1,622
Middle East/Asia 1,888 1,484
-------------------------------------- ------- -------
Total 8,170 6,950
-------------------------------------- ------- -------
Total revenue by region:
North America 12,251 10,303
Latin America 2,611 2,105
Europe/Africa/CIS 3,296 2,871
Middle East/Asia 3,055 2,486
-------------------------------------- ------- -------
Operating income by geographic region:
--------------------------------------
Completion and Production:
North America $ 1,945 $ 2,401
Latin America 149 108
Europe/Africa/CIS 240 4
Middle East/Asia 207 133
-------------------------------------- ------- -------
Total 2,541 2,646
-------------------------------------- ------- -------
Drilling and Evaluation:
North America 530 463
Latin America 257 186
Europe/Africa/CIS 167 126
Middle East/Asia 237 148
-------------------------------------- ------- -------
Total 1,191 923
-------------------------------------- ------- -------
Total operating income by region:
North America 2,475 2,864
Latin America 406 294
Europe/Africa/CIS 407 130
Middle East/Asia 444 281
-------------------------------------- ------- -------
Corporate and other (554) (262)
-------------------------------------- ------- -------
Total operating income $ 3,178 $ 3,307
-------------------------------------- ------- -------
See Footnote Table 2 for a list of significant items included in
operating income.
FOOTNOTE TABLE 1
HALLIBURTON COMPANY
Items Included in Operating Income
(Millions of dollars except per share data)
(Unaudited)
Three Months Ended Three Months Ended
September 30, 2012 September 30, 2011
----------------------------------------------- -----------------------------------------------
Operating After Tax Operating After Tax
Income per Share Income per Share
----------------------- ----------------------- ----------------------- -----------------------
Completion and Production:
North America
Acquisition-related charge $ (40 ) $ (0.02 ) $ - $ -
Latin America
Acquisition-related charge (8 ) (0.01 ) - -
Europe/Africa/CIS
Asset impairment charge - - (25 ) (0.02 )
--------------------------------------- -------------- -------------- -------------- --- -------------- ---
Corporate and other:
Patent infringement case settlement 20 0.01 - -
--------------------------------------- -------------- -------------- -------------- --------------
FOOTNOTE TABLE 2
HALLIBURTON COMPANY
Items Included in Operating Income
(Millions of dollars except per share data)
(Unaudited)
Nine Months Ended Nine Months Ended
September 30, 2012 September 30, 2011
----------------------------------------------- -----------------------------------------------
Operating After Tax Operating After Tax
Income per Share Income per Share
----------------------- ----------------------- ----------------------- -----------------------
Completion and Production:
North America
Acquisition-related charge $ (40 ) $ (0.02 ) $ - $ -
Latin America
Acquisition-related charge (8 ) (0.01 ) - -
Europe/Africa/CIS
Asset impairment charge - - (25 ) (0.02 )
Employee separation costs - - (5 ) (0.01 )
Libya reserve - - (36 ) (0.03 )
Middle East/Asia
Employee separation costs - - (1 ) -
--------------------------------------- -------------- -------------- -------------- --- --------------
Drilling and Evaluation:
Europe/Africa/CIS
Employee separation costs - - (4 ) -
Libya reserve - - (23 ) (0.02 )
Middle East/Asia
Employee separation costs - - (1 ) -
--------------------------------------- -------------- -------------- -------------- --- --------------
Corporate and other:
Macondo-related charge (300 ) (0.20 ) - -
Patent infringement case settlement 20 0.01 - -
--------------------------------------- -------------- -------------- -------------- --------------
FOOTNOTE TABLE 3
HALLIBURTON COMPANY
Adjusted Total Operating Income Excluding Certain Items
By Segment and Geographic Region
(Millions of dollars)
(Unaudited)
Three Months Ended
-------------------------------------------------
September 30 June 30
-------------------------------- ----------------
Adjusted operating income by geographic region: (a) (b) 2012 2011 2012
------------------------------------------------------- --------------- ---------------- ----------------
Completion and Production:
North America $ 423 $ 960 $ 691
Latin America 48 43 54
Europe/Africa/CIS 88 40 95
Middle East/Asia 80 50 74
------------------------------------------------------- ---- ----- -----
Total 639 1,093 914
------------------------------------------------------- ---- ----- -----
Drilling and Evaluation:
North America 174 175 166
Latin America 106 94 84
Europe/Africa/CIS 63 51 64
Middle East/Asia 87 49 79
------------------------------------------------------- ---- ----- -----
Total 430 369 393
------------------------------------------------------- ---- ----- -----
Adjusted operating income by region:
North America 597 1,135 857
Latin America 154 137 138
Europe/Africa/CIS 151 91 159
Middle East/Asia 167 99 153
------------------------------------------------------- ---- ----- -----
Corporate and other (87 ) (105 ) (106 )
------------------------------------------------------- ---- ---- ----- ---- ----- ----
Adjusted total operating income $ 982 $ 1,357 $ 1,201
------------------------------------------------------- ---- ---- ---- ----- ---- -----
(a) Management believes that operating income adjusted for the third
quarter of 2012 acquisition-related charge and patent infringement
case settlement and the third quarter of 2011 asset impairment
charge is useful to investors to assess and understand operating
performance, especially when comparing those results with previous
or subsequent periods or forecasting performance for future
periods, primarily because management views these 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 ongoing operating performance, to identify underlying
trends in the business, and to establish operational goals,
including segment and region operational goals. The adjustments
remove the effects of these expenses.
(b) Adjusted operating income for each segment and region is
calculated as: "Operating income" less "Items Included in
Operating Income."
FOOTNOTE TABLE 4
HALLIBURTON COMPANY
Reconciliation of As Reported Results to Adjusted Results
(Millions of dollars)
(Unaudited)
Three Months Ended
September 30, 2012
--------------------------
As reported income from continuing operations attributable to company $ 608
Acquisition-related charge, net of tax (a) 30
Patent infringement case settlement, net of tax (a) (13 )
--------------------------------------------------------------------- ----------- -
Adjusted income from continuing operations attributable to company $ 625
(a)
--------------------------------------------------------------------- ----------- -----------
As reported diluted weighted average common shares outstanding 930
As reported income from continuing operations per diluted share (b) $ 0.65
Adjusted income from continuing operations per diluted share (b) $ 0.67
--------------------------------------------------------------------- ----------- -----------
(a) Management believes that income from continuing operations
attributable to company adjusted for the acquisition-related
charge and patent infringement case settlement 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 attributable to company
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
expenses. Adjusted income from continuing operations attributable
to company is calculated as: "As reported income from continuing
operations attributable to company" plus "Acquisition-related
charge, net of tax" plus "Patent infringement case settlement, net
of tax" for the quarter ended September 30, 2012.
(b) As reported income from continuing operations per diluted share is
calculated as: "As reported income from continuing operations
attributable to company" divided by "As reported diluted weighted
average common shares outstanding." Adjusted income from
continuing operations per diluted share is calculated as:
"Adjusted income from continuing operations attributable to
company" divided by "As reported diluted weighted average common
shares outstanding."
Conference Call Details
Halliburton (HAL) will host a conference call on Wednesday, October
17, 2012, to discuss the third quarter 2012 financial results. The call
will begin at 8:00 AM Central Time (9:00 AM Eastern Time).
Halliburton’s third quarter press release will be posted on the
Halliburton Web site at www.halliburton.com.
Please visit the Web site to listen to the call live via webcast. In
addition, you may participate in the call by telephone at (703)
639-1313. 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 Web
site for seven days following the call. Also, a replay may be accessed
by telephone at (703) 925-2533, passcode 1585962.
SOURCE: Halliburton
Halliburton
Kelly Youngblood, 281-871-2688
Investor Relations
investors@halliburton.com
or
Beverly Blohm Stafford, 281-871-2601
Corporate Affairs
PR@halliburton.com
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