In the first nine months of 2002, revenues were $1.75 billion and net income, excluding the non-recurring charge, was $118.6 million ($0.94 per diluted share). In 2001, reported revenues for the first nine months were $1.71 billion, and net income was $160.1 million ($1.32 per diluted share). Net income for this prior year period, excluding goodwill amortization net of taxes would have been $187.4 million ($1.53 per diluted share).
Weatherford's quarterly revenues fell 4 percent from the prior year third quarter due largely to a global decline in drilling activity. North American rig activity fell by more than 25 percent year to year and international rig activity declined 6 percent. Over the same time frame, Weatherford's third quarter North American revenues fell 18 percent while international revenues increased 13 percent. The declines reflect the effects of lower offshore activity in the Gulf of Mexico and the UK sector of the North Sea and less drilling in North American land markets.
Drilling & Intervention Services
Third quarter revenues were $319.9 million, 12 percent below the prior year quarter and 3 percent higher than the preceding quarter. EBITDA of $99.6 million was 26 percent below the prior year quarter and 1 percent below the preceding quarter.
Sequentially, Drilling & Intervention Services third quarter performance reflected the impact of tropical storm Isidore on activity in the Gulf of Mexico late in the quarter, slower activity in the UK sector of the North Sea and an unfavorable product mix. North American revenues were up slightly. While international revenues increased 5 percent sequentially, that growth was moderated by softening activity in the North Sea.
Completion Systems
Third quarter revenues of $88.3 million were 2 percent higher than the prior year quarter and 16 percent below the preceding quarter. EBITDA of $18.2 million was 12 percent below the prior year and 31 percent below the preceding quarter.
Sequentially, Completion Systems performance was affected by weather in the Gulf of Mexico and a temporary disruption in the commercialization of one size of expandable sand screen product.
Artificial Lift Systems
Third quarter revenues of $176.7 million were 12 percent higher than the prior year quarter and 2 percent below the preceding quarter. EBITDA of $30.2 million was 1 percent below the prior year and 5 percent below the preceding quarter.
Sequentially, North American revenue improved 6 percent while international activity declined 12 percent due to lower activity in the Latin American and Asia Pacific regions.
Weatherford 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 approximately 15,000 people worldwide.
Contact: Don Galletly (713) 693-4148
Lisa Rodriguez (713) 693-4746
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 and the successful integration of the
plan of restructuring, all of which are subject to certain risks, uncertainties
and assumptions. These risks and uncertainties, which are more fully described
in Weatherford International Ltd.'s and Weatherford International, Inc.'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 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 the restructuring and our business. Should one or more
of these risks or uncertainties materialize, or should the assumptions prove
incorrect, actual results may vary in material aspects from those currently
anticipated.
Weatherford International Ltd.
Consolidated Condensed Statements of Operations
(In 000's, Except Per Share Amounts)
Three Months Nine Months
Ended September 30, Ended September 30,
2002 2001 2002 2001
Net Revenues:
Drilling and Intervention
Services $319,872 $363,293 $942,610 $986,197
Completion Systems 88,335 86,838 285,451 247,807
Artificial Lift Systems 176,723 158,490 518,984 446,836
Compression Services --- --- --- 26,939
584,930 608,621 1,747,045 1,707,779
Operating Income (Loss):
Drilling and Intervention
Services 60,730 96,070 194,371 261,988
Completion Systems 9,367 12,668 43,372 33,512
Artificial Lift Systems 24,658 23,340 73,780 61,360
Compression Services --- --- --- (511)
Research and Development (19,624) (12,881) (55,147) (35,139)
Equity in Earnings 5,445 6,947 18,640 14,708
Corporate Expenses (9,871) (9,984) (33,957) (29,650)
Non-recurring Charge (232,493) --- (232,493) ---
(161,788) 116,160 8,566 306,268
Other Expense:
Other, Net (917) (1,572) (2,891) (1,986)
Interest Expense, Net (20,404) (19,802) (61,401) (51,907)
Income (Loss) Before Income
Taxes (183,109) 94,786 (55,726) 252,375
Provision for Income Taxes (14,815) (34,605) (58,127) (92,248)
Benefit for Income Taxes,
Related to
the Non-recurring Charge 76,282 --- 76,282 ---
Net Income (Loss) $(121,642) $60,181 $(37,571) $160,127
Earnings (Loss) Per Share:
Basic $(1.01) $0.52 $(0.31) $1.42
Diluted (A) $(1.01) $0.49 $(0.31) $1.32
Weighted Average Shares
Outstanding:
Basic 120,193 115,068 119,796 113,093
Diluted (B) 120,193 135,081 119,796 131,826
(A) Diluted earnings per share for the three and nine months ended
September 30, 2001 excluding goodwill amortization, net of taxes, was
$0.56 and $1.53, respectively.
(B) For pro forma calculations of diluted earnings per share excluding the
non-recurring charge, diluted weighted average shares outstanding were
125,138 and 131,568 for the three months and nine months ended
September 30, 2002, respectively.
Weatherford International Ltd.
Supplemental Information
(In 000's)
Three Months Nine Months
Ended September 30, Ended September 30,
2002 2001 2002 2001
Geographic Revenues:
Eastern Hemisphere $259,194 $206,645 $774,176 $541,478
United States 195,969 252,817 586,093 717,767
Canada 79,964 83,060 236,758 257,072
Latin America 49,803 66,099 150,018 191,462
$584,930 $608,621 $1,747,045 $1,707,779
Depreciation and Amortization:
Drilling and Intervention
Services $38,857 $37,793 $113,923 $99,738
Completion Systems 8,881 8,150 22,856 21,733
Artificial Lift Systems 5,587 7,212 17,086 20,908
Compression Services --- --- --- 4,184
Research and Development 881 540 2,413 1,487
Other 772 1,763 2,040 4,795
$54,978 $55,458 $158,318 $152,845
Research and Development:
Drilling and Intervention
Services $7,255 $6,310 $19,012 $17,185
Completion Systems 10,444 5,448 30,583 14,951
Artificial Lift Systems 1,925 1,123 5,552 2,917
Compression Services --- --- --- 86
$19,624 $12,881 $55,147 $35,139
SOURCE Weatherford International Ltd.
CONTACT: Don Galletly, +1-713-693-4148, or Lisa Rodriguez, +1-713-693-4746, both of Weatherford International Ltd.