BAAR,
The non-GAAP net loss for the fourth quarter of 2018 was
Significant Highlights
Revenues in the fourth quarter of 2018 were
On a year-over-year basis, higher revenues associated with integrated service projects and product sales in
Operating loss for the fourth quarter of 2018 was
The sequential decrease in segment operating income was driven primarily by a provision for a litigation settlement in
Year-over-year segment operating income increase was driven by improved efficiencies and reduced expenses as a result of the transformation processes. Further, negative impacts from exceptional operating items in both hemispheres and low-margin product sales realized in 2017 did not repeat in 2018.
In the quarter, Weatherford recorded pre-tax charges of
In the fourth quarter of 2018, incremental recurring benefits as a result of the transformation plan were approximately
"We achieved positive operating cash flow during the quarter and further enhanced our liquidity as we closed the first two tranches of our international land drilling rig sale. Our year-end liquidity position of over
Cash Flow
Net cash provided by operating activities was
Operating Segments
Three Months Ended |
Change |
||||||||||||||||
(In Millions) |
12/31/2018 |
9/30/2018 |
12/31/2017 |
Sequential |
YoY |
||||||||||||
Western Hemisphere |
|||||||||||||||||
Revenues |
$ |
776 |
$ |
762 |
$ |
759 |
2 |
% |
2 |
% |
|||||||
Segment Operating Income (Loss) |
$ |
56 |
$ |
78 |
$ |
(35) |
(28) |
% |
260 |
% |
|||||||
Segment Operating Margin |
7.2 |
% |
10.2 |
% |
(4.6) |
% |
(300) |
bps |
1,180 |
bps |
|||||||
Eastern Hemisphere |
|||||||||||||||||
Revenues |
$ |
653 |
$ |
682 |
$ |
731 |
(4) |
% |
(11) |
% |
|||||||
Segment Operating Income (Loss) |
$ |
46 |
$ |
38 |
$ |
(48) |
21 |
% |
196 |
% |
|||||||
Segment Operating Margin |
7.0 |
% |
5.6 |
% |
(6.6) |
% |
140 |
bps |
1,360 |
bps |
Western Hemisphere
Fourth quarter revenues of
Fourth quarter segment operating income of
Operational highlights in the Western Hemisphere during the quarter include:
Eastern Hemisphere
Fourth quarter revenues of
Fourth quarter segment operating income of
Operational highlights in the Eastern Hemisphere during the quarter include:
Reclassifications
In 2018 we adopted pension accounting standards on a retrospective basis, reclassifying the presentation of non-service cost components of net periodic pension and post-retirement cost from operating income to non-operating Other Income (Expense), Net. All prior periods have been restated to conform to the current presentation within the Condensed Consolidated Statements of Operations and other financial information in the following pages.
About Weatherford
Weatherford is one of the largest multinational oilfield service companies providing innovative solutions, technology and services to the oil and gas industry. The Company operates in over 80 countries and has a network of approximately 700 locations, including manufacturing, service, research and development and training facilities and employs approximately 26,500 people. For more information, visit http://www.weatherford.com and connect with Weatherford on LinkedIn,
Conference Call
The Company will host a conference call with financial analysts to discuss the quarterly results on February 1, 2019, at
Contacts: |
Christoph Bausch |
+1.713.836.4615 |
Executive Vice President and Chief Financial Officer |
||
Karen David-Green |
+1.713.836.7430 |
|
Senior Vice President, Stakeholder Engagement and Chief Marketing Officer |
Forward-Looking Statements
This news release contains, and the conference call announced in this release may include, forward-looking statements. These forward-looking statements include, among other things, the Company's quarterly non-GAAP earnings per share, effective tax rate, net debt, forecasts or expectations regarding business outlook, and capital expenditures, and are also generally identified by the words "believe," "project," "expect," "anticipate," "estimate," "outlook," "budget," "intend," "strategy," "plan," "guidance," "may," "should," "could," "will," "would," "will be," "will continue," "will likely result," and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of Weatherford's management, and are subject to significant risks, assumptions and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Readers are also cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results, including possible changes in the expected efficiencies and cost savings associated with our transformation plans; completion of potential dispositions, continued compliance with
Weatherford International plc |
||||||||||||||||
Condensed Consolidated Statements of Operations |
||||||||||||||||
(Unaudited) |
||||||||||||||||
(In Millions, Except Per Share Amounts) |
||||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||
12/31/2018 |
12/31/2017 |
12/31/2018 |
12/31/2017 |
|||||||||||||
Revenues: |
||||||||||||||||
Western Hemisphere |
$ |
776 |
$ |
759 |
$ |
3,063 |
$ |
2,937 |
||||||||
Eastern Hemisphere |
653 |
731 |
2,681 |
2,762 |
||||||||||||
Total Revenues |
1,429 |
1,490 |
5,744 |
5,699 |
||||||||||||
Operating Loss: |
||||||||||||||||
Western Hemisphere |
56 |
(35) |
208 |
(113) |
||||||||||||
Eastern Hemisphere |
46 |
(48) |
119 |
(139) |
||||||||||||
Segment Operating Income (Loss) |
102 |
(83) |
327 |
(252) |
||||||||||||
Corporate Expenses |
(29) |
(36) |
(130) |
(130) |
||||||||||||
Goodwill Impairment |
(1,917) |
— |
(1,917) |
— |
||||||||||||
Restructuring and Transformation Charges |
(36) |
(43) |
(126) |
(183) |
||||||||||||
Other Charges, Net |
(79) |
(1,579) |
(238) |
(1,605) |
||||||||||||
Total Operating Loss |
(1,959) |
(1,741) |
(2,084) |
(2,170) |
||||||||||||
Other Income (Expense): |
||||||||||||||||
Interest Expense, Net |
(157) |
(152) |
(614) |
(579) |
||||||||||||
Bond Tender and Call Premium |
— |
— |
(34) |
— |
||||||||||||
Warrant Fair Value Adjustment |
3 |
28 |
70 |
86 |
||||||||||||
Currency Devaluation Charges |
(4) |
— |
(49) |
— |
||||||||||||
Other Income (Expense), Net |
(25) |
(7) |
(46) |
7 |
||||||||||||
Net Loss Before Income Taxes |
(2,142) |
(1,872) |
(2,757) |
(2,656) |
||||||||||||
Income Tax Benefit (Provision) |
46 |
(62) |
(34) |
(137) |
||||||||||||
Net Loss |
(2,096) |
(1,934) |
(2,791) |
(2,793) |
||||||||||||
Net Income Attributable to Noncontrolling Interests |
7 |
4 |
20 |
20 |
||||||||||||
Net Loss Attributable to Weatherford |
$ |
(2,103) |
$ |
(1,938) |
$ |
(2,811) |
$ |
(2,813) |
||||||||
Loss Per Share Attributable to Weatherford: |
||||||||||||||||
Basic & Diluted |
$ |
(2.10) |
$ |
(1.95) |
$ |
(2.82) |
$ |
(2.84) |
||||||||
Weighted Average Shares Outstanding: |
||||||||||||||||
Basic & Diluted |
1,001 |
993 |
997 |
990 |
Weatherford International plc |
|||||||||||||||||||
Selected Statements of Operations Information |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
(In Millions) |
|||||||||||||||||||
Three Months Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
|||||||||||||||
Revenues: |
|||||||||||||||||||
Western Hemisphere |
$ |
776 |
$ |
762 |
$ |
769 |
$ |
756 |
$ |
759 |
|||||||||
Eastern Hemisphere |
653 |
682 |
679 |
667 |
731 |
||||||||||||||
Total Revenues |
$ |
1,429 |
$ |
1,444 |
$ |
1,448 |
$ |
1,423 |
$ |
1,490 |
|||||||||
Three Months Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
|||||||||||||||
Operating Loss: |
|||||||||||||||||||
Western Hemisphere |
$ |
56 |
$ |
78 |
$ |
50 |
$ |
24 |
$ |
(35) |
|||||||||
Eastern Hemisphere |
46 |
38 |
19 |
16 |
(48) |
||||||||||||||
Segment Operating Income (Loss) |
102 |
116 |
69 |
40 |
(83) |
||||||||||||||
Corporate Expenses |
(29) |
(31) |
(34) |
(36) |
(36) |
||||||||||||||
Goodwill Impairment |
(1,917) |
— |
— |
— |
— |
||||||||||||||
Restructuring and Transformation Charges |
(36) |
(27) |
(38) |
(25) |
(43) |
||||||||||||||
Other Charges, Net |
(79) |
(71) |
(70) |
(18) |
(1,579) |
||||||||||||||
Total Operating Loss |
$ |
(1,959) |
$ |
(13) |
$ |
(73) |
$ |
(39) |
$ |
(1,741) |
|||||||||
Three Months Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
|||||||||||||||
Product and Service Line (a) Revenues: |
|||||||||||||||||||
Production |
$ |
401 |
$ |
383 |
$ |
394 |
$ |
381 |
$ |
408 |
|||||||||
Completion |
314 |
303 |
303 |
294 |
339 |
||||||||||||||
Drilling and Evaluation |
369 |
357 |
341 |
358 |
349 |
||||||||||||||
Well Construction |
345 |
401 |
410 |
390 |
394 |
||||||||||||||
Total Product and Service Line Revenues |
$ |
1,429 |
$ |
1,444 |
$ |
1,448 |
$ |
1,423 |
$ |
1,490 |
|||||||||
Three Months Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
|||||||||||||||
Depreciation and Amortization: |
|||||||||||||||||||
Western Hemisphere |
$ |
54 |
$ |
46 |
$ |
56 |
$ |
60 |
$ |
80 |
|||||||||
Eastern Hemisphere |
82 |
81 |
84 |
86 |
109 |
||||||||||||||
Corporate |
1 |
1 |
4 |
1 |
1 |
||||||||||||||
Total Depreciation and Amortization |
$ |
137 |
$ |
128 |
$ |
144 |
$ |
147 |
$ |
190 |
(a) |
Production includes Artificial Lift Systems, Stimulation and Testing and Production Services. Completions includes Completion Systems, Liner Systems and Cementing Products. Drilling and Evaluation includes Drilling Services, Managed Pressure Drilling, Surface Logging Systems, Wireline Services and Reservoir Solutions. Well Construction includes Tubular Running Services, Intervention Services, Drilling Tools and Rental Equipment and Land Drilling Rigs. |
We report our financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, Weatherford's management believes that certain non-GAAP financial measures and ratios (as defined under the
Weatherford International plc |
||||||||||||||||||||
Reconciliation of GAAP to Non-GAAP Financial Measures |
||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||
(In Millions, Except Per Share Amounts) |
||||||||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
12/31/2017 |
12/31/2018 |
12/31/2017 |
||||||||||||||||
Operating Income (Loss): |
||||||||||||||||||||
GAAP Operating Loss |
$ |
(1,959) |
$ |
(13) |
$ |
(1,741) |
$ |
(2,084) |
$ |
(2,170) |
||||||||||
Goodwill Impairment (a) |
1,917 |
— |
— |
1,917 |
— |
|||||||||||||||
Restructuring and Transformation Charges (b) |
36 |
27 |
43 |
126 |
183 |
|||||||||||||||
Impairments, Asset Write-Downs and Other (c) (d) |
79 |
71 |
1,675 |
238 |
1,701 |
|||||||||||||||
Gain from Disposition of U.S. Pressure Pumping and Pump-Down Perforating Assets |
— |
— |
(96) |
— |
(96) |
|||||||||||||||
Operating Non-GAAP Adjustments |
2,032 |
98 |
1,622 |
2,281 |
1,788 |
|||||||||||||||
Non-GAAP Adjusted Operating Income (Loss) |
$ |
73 |
$ |
85 |
$ |
(119) |
$ |
197 |
$ |
(382) |
||||||||||
Loss Before Income Taxes: |
||||||||||||||||||||
GAAP Loss Before Income Taxes |
$ |
(2,142) |
$ |
(172) |
$ |
(1,872) |
$ |
(2,757) |
$ |
(2,656) |
||||||||||
Operating Non-GAAP Adjustments |
2,032 |
98 |
1,622 |
2,281 |
1,788 |
|||||||||||||||
Bond Tender and Call Premium (e) |
— |
— |
— |
34 |
— |
|||||||||||||||
Warrant Fair Value Adjustment |
(3) |
(11) |
(28) |
(70) |
(86) |
|||||||||||||||
Defined Benefit Pension Plan Gains (f) |
— |
— |
— |
— |
(47) |
|||||||||||||||
Currency Devaluation Charges (g) |
4 |
8 |
— |
49 |
— |
|||||||||||||||
Non-GAAP Adjustments Before Taxes |
$ |
2,033 |
$ |
95 |
$ |
1,594 |
$ |
2,294 |
$ |
1,655 |
||||||||||
Non-GAAP Loss Before Income Taxes |
$ |
(109) |
$ |
(77) |
$ |
(278) |
$ |
(463) |
$ |
(1,001) |
||||||||||
Benefit (Provision) for Income Taxes: |
||||||||||||||||||||
GAAP Benefit (Provision) for Income Taxes |
$ |
46 |
$ |
(22) |
$ |
(62) |
$ |
(34) |
$ |
(137) |
||||||||||
Tax Effect on Non-GAAP Adjustments |
(70) |
1 |
15 |
(70) |
8 |
|||||||||||||||
Non-GAAP Provision for Income Taxes |
$ |
(24) |
$ |
(21) |
$ |
(47) |
$ |
(104) |
$ |
(129) |
||||||||||
Net Loss Attributable to Weatherford: |
||||||||||||||||||||
GAAP Net Loss |
$ |
(2,103) |
$ |
(199) |
$ |
(1,938) |
$ |
(2,811) |
$ |
(2,813) |
||||||||||
Non-GAAP Adjustments, net of tax |
1,963 |
96 |
1,609 |
2,224 |
1,663 |
|||||||||||||||
Non-GAAP Net Loss |
$ |
(140) |
$ |
(103) |
$ |
(329) |
$ |
(587) |
$ |
(1,150) |
||||||||||
Diluted Loss Per Share Attributable to Weatherford: |
||||||||||||||||||||
GAAP Diluted Loss per Share |
$ |
(2.10) |
$ |
(0.20) |
$ |
(1.95) |
$ |
(2.82) |
$ |
(2.84) |
||||||||||
Non-GAAP Adjustments, net of tax |
1.96 |
0.10 |
1.62 |
2.23 |
1.68 |
|||||||||||||||
Non-GAAP Diluted Loss per Share |
$ |
(0.14) |
$ |
(0.10) |
$ |
(0.33) |
$ |
(0.59) |
$ |
(1.16) |
||||||||||
GAAP Effective Tax Rate (h) |
2 |
% |
(12) |
% |
(3) |
% |
(1) |
% |
(5) |
% |
||||||||||
Non-GAAP Effective Tax Rate (i) |
(23) |
% |
(26) |
% |
(16) |
% |
(23) |
% |
(13) |
% |
(a) |
Represents goodwill impairment of $1.9 billion based upon our annual fair value assessment of our business and assets. |
(b) |
Represents severance, transformation and facility exit costs in 2018 and 2017. |
(c) |
The fourth quarter of 2018 and year ended December 31, 2018, primarily included long-lived asset impairments, other asset write-downs and inventory charges primarily relate to land drilling rigs, partially offset by gains on purchase of the remaining interest in a joint venture, property sales and a reduction of a contingency reserve on a legacy contract. |
(d) |
The fourth quarter of 2017 and year ended December 31, 2017, primarily included impairments, asset write-downs and other of $934 million in long-lived asset impairments (of which $740 million relates to Land Drilling Rigs assets reclassified to held for sale), $434 million in inventory write-downs and $230 million in the write-down of Venezuelan receivables. |
(e) |
Represents a bond tender and call premium on the tender offer redemption of our 9.625% senior notes. |
(f) |
Represents the supplemental executive retirement plan gain that was reclassified from Operating Non-GAAP Adjustments to non-operating Other Income (Expense), Net upon retrospective adoption of the new pension accounting standards in the first quarter of 2018. |
(g) |
Represents currency devaluations of the Angolan kwanza and Venezuelan bolivar. |
(h) |
GAAP Effective Tax Rate is the GAAP provision for income taxes divided by GAAP income before income taxes and calculated in thousands. |
(i) |
Non-GAAP Effective Tax Rate is the Non-GAAP provision for income taxes divided by Non-GAAP income before income taxes and calculated in thousands. |
Weatherford International plc |
||||||||||||||||||||
Reconciliation of GAAP to Non-GAAP Financial Measures - EBITDA |
||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||
(In Millions) |
||||||||||||||||||||
Three Months Ended |
Year Ended |
|||||||||||||||||||
12/31/2018 |
9/30/2018 |
12/31/2017 |
12/31/2018 |
12/31/2017 |
||||||||||||||||
Net Loss Attributable to Weatherford |
$ |
(2,103) |
$ |
(199) |
$ |
(1,938) |
$ |
(2,811) |
$ |
(2,813) |
||||||||||
Net Income Attributable to Noncontrolling Interests |
7 |
5 |
4 |
20 |
20 |
|||||||||||||||
Net Loss |
(2,096) |
(194) |
(1,934) |
(2,791) |
(2,793) |
|||||||||||||||
Interest Expense, Net |
157 |
156 |
152 |
614 |
579 |
|||||||||||||||
Income Tax (Benefit) Provision |
(46) |
22 |
62 |
34 |
137 |
|||||||||||||||
Depreciation and Amortization |
137 |
128 |
190 |
556 |
801 |
|||||||||||||||
EBITDA |
(1,848) |
112 |
(1,530) |
(1,587) |
(1,276) |
|||||||||||||||
Other (Income) Expense Adjustments: |
||||||||||||||||||||
Goodwill Impairment |
1,917 |
— |
— |
1,917 |
— |
|||||||||||||||
Impairments, Asset Write-Downs and Other |
79 |
71 |
1,675 |
238 |
1,701 |
|||||||||||||||
Restructuring and Transformation Charges |
36 |
27 |
43 |
126 |
183 |
|||||||||||||||
Gain from Disposition of U.S. Pressure Pumping and Pump-Down Perforating Assets |
— |
— |
(96) |
— |
(96) |
|||||||||||||||
Warrant Fair Value Adjustment |
(3) |
(11) |
(28) |
(70) |
(86) |
|||||||||||||||
Bond Tender and Call Premium |
— |
— |
— |
34 |
— |
|||||||||||||||
Currency Devaluation Charges |
4 |
8 |
— |
49 |
— |
|||||||||||||||
Other (Income) Expense, Net |
25 |
6 |
7 |
46 |
(7) |
|||||||||||||||
Adjusted EBITDA |
$ |
210 |
$ |
213 |
$ |
71 |
$ |
753 |
$ |
419 |
Weatherford International plc |
||||||||||||||||||||
Selected Balance Sheet Data |
||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||
(In Millions) |
||||||||||||||||||||
12/31/2018 |
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
||||||||||||||||
Assets: |
||||||||||||||||||||
Cash and Cash Equivalents |
$ |
602 |
$ |
393 |
$ |
415 |
$ |
459 |
$ |
613 |
||||||||||
Accounts Receivable, Net |
1,130 |
1,155 |
1,167 |
1,100 |
1,103 |
|||||||||||||||
Inventories, Net |
1,025 |
1,097 |
1,143 |
1,225 |
1,234 |
|||||||||||||||
Assets Held for Sale |
265 |
618 |
489 |
369 |
359 |
|||||||||||||||
Property, Plant and Equipment, Net |
2,086 |
2,157 |
2,273 |
2,580 |
2,708 |
|||||||||||||||
Goodwill and Intangibles, Net |
926 |
2,824 |
2,837 |
2,968 |
2,940 |
|||||||||||||||
Liabilities: |
||||||||||||||||||||
Accounts Payable |
732 |
728 |
754 |
809 |
856 |
|||||||||||||||
Liabilities Held for Sale |
17 |
49 |
— |
— |
— |
|||||||||||||||
Short-term Borrowings and Current Portion of Long-term Debt |
383 |
396 |
295 |
153 |
148 |
|||||||||||||||
Long-term Debt |
7,605 |
7,626 |
7,634 |
7,639 |
7,541 |
|||||||||||||||
Shareholders' Deficiency: |
||||||||||||||||||||
Total Shareholders' Deficiency (a) |
(3,666) |
(1,508) |
(1,312) |
(898) |
(571) |
(a) |
On January 1, 2018, we adopted the accounting standard related to taxes on intra-entity transfers of non-inventory assets on a modified retrospective basis and the impact from this adoption was to record the previously recorded prepaid taxes as an adjustment to retained earnings. In addition we also adopted the revenue recognition accounting standard and recorded the cumulative effect of the changes made to our consolidated balance sheet as an adjustment to retained earnings. |
Weatherford International plc |
||||||||||||
Net Debt (a) |
||||||||||||
(Unaudited) |
||||||||||||
(In Millions) |
||||||||||||
Change in Net Debt for the Three Months Ended 12/31/2018: |
||||||||||||
Net Debt at 9/30/2018 (a) |
$ |
(7,629) |
||||||||||
Operating Loss |
(1,959) |
|||||||||||
Depreciation and Amortization |
137 |
|||||||||||
Goodwill Impairment |
1,917 |
|||||||||||
Capital Expenditures for Property, Plant and Equipment (c) |
(75) |
|||||||||||
Capital Expenditures for Assets Held for Sale (c) |
(1) |
|||||||||||
Proceeds from Disposition of Businesses |
220 |
|||||||||||
Proceeds from Disposition of Assets (c) |
36 |
|||||||||||
Acquisition of Intangibles |
(17) |
|||||||||||
Decrease in Working Capital (b) |
84 |
|||||||||||
Other Financing Activities |
(12) |
|||||||||||
Income Taxes Paid |
(12) |
|||||||||||
Interest Paid |
(145) |
|||||||||||
Other |
70 |
|||||||||||
Net Debt at 12/31/2018 (a) |
$ |
(7,386) |
||||||||||
Change in Net Debt for the Twelve Months Ended 12/31/2018: |
||||||||||||
Net Debt at 12/31/2017 (a) |
$ |
(7,076) |
||||||||||
Operating Loss |
(2,084) |
|||||||||||
Depreciation and Amortization |
556 |
|||||||||||
Goodwill Impairment |
1,917 |
|||||||||||
Capital Expenditures for Property, Plant and Equipment (c) |
(186) |
|||||||||||
Capital Expenditures for Assets Held for Sale (c) |
(31) |
|||||||||||
Proceeds from Disposition of Business and Investments |
257 |
|||||||||||
Proceeds from Disposition of Assets (c) |
106 |
|||||||||||
Acquisition of Intangibles |
(28) |
|||||||||||
Other Financing Activities |
(40) |
|||||||||||
Increase in Working Capital (b) |
(74) |
|||||||||||
Accrued Litigation and Settlements |
(25) |
|||||||||||
Income Taxes Paid |
(99) |
|||||||||||
Interest Paid |
(584) |
|||||||||||
Other |
5 |
|||||||||||
Net Debt at 12/31/2018 (a) |
$ |
(7,386) |
||||||||||
Components of Net Debt (a) |
12/31/2018 |
9/30/2018 |
12/31/2017 |
|||||||||
Cash |
$ |
602 |
$ |
393 |
$ |
613 |
||||||
Short-term Borrowings and Current Portion of Long-term Debt |
(383) |
(396) |
(148) |
|||||||||
Long-term Debt |
(7,605) |
(7,626) |
(7,541) |
|||||||||
Net Debt (a) |
$ |
(7,386) |
$ |
(7,629) |
$ |
(7,076) |
(a) |
"Net Debt" is defined as debt less cash. Management believes that it provides useful information regarding our level of indebtedness by reflecting cash that could be used to repay debt. |
(b) |
Working capital is defined as the cash changes in accounts receivable plus inventory less accounts payable. |
(c) |
The sum of capital expenditures and proceeds from disposition of assets is deducted from net cash generated by operating activities to arrive at "Free Cash Flow." |
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