Investor Email Alerts

Weatherford Reports Fourth Quarter Results

26 Feb 2013
Download PDF
Quarterly positive cash flow from operations of over $200 million on record revenue exceeding $4 billion

GENEVA, Switzerland, Feb. 26, 2013 /PRNewswire/ -- Weatherford International Ltd. (NYSE and SIX: WFT) today reported fourth quarter 2012 revenues of $4,058 million, the highest in the company's history. In addition, Weatherford reduced net debt by $207 million via positive cash flow from operations during the quarter.

(Logo: http://photos.prnewswire.com/prnh/19990308/WEATHERFORDLOGO)

Weatherford reported a loss for the quarter of $122 million or $0.16 per share. After excluding losses, net of tax, of $130 million or $0.17 per share earnings were $8 million or $0.01 per share.  The excluded items include:

  • $43 million in professional fees associated with our accounting for income tax remediation efforts,
  • $64 million associated with legacy lump sum contracts in Iraq consisting of operating losses $30 million and tax receivable write offs $34 million and 
  • $23 million in severance, exit and other charges.

The Non-GAAP effective tax rate for the quarter was 92%.

Fourth quarter revenues of $4,058 million were up six percent sequentially from our third quarter revenues of $3,819 million.  Fourth quarter revenues also increased nine percent from the same quarter of 2011.

North America revenue of $1,682 million was down two percent sequentially, in line with the sequential decline in the North America rig count, and down one percent versus the same quarter of 2011.  Stimulation & Chemicals contributed to the sequential declines.

International revenues of $2,376 million were up 13 percent sequentially and up 18 percent versus the same quarter of 2011.  Integrated Drilling, Formation Evaluation and Well Construction led the sequential growth with strong performance from Drilling Services and Drilling Tools.  Completion Systems also posted strong sequential growth.

Segment operating income was $438 million on a GAAP basis.  Adjusted for excluded items segment operating income of $468 million was down ten percent sequentially and down 23 percent from the same quarter of 2011.  On an adjusted basis, corporate expenses, and research and development were essentially flat sequentially.

For 2013, the company maintains a neutral outlook for its North American business and expects modest revenue and operating income growth. Internationally, the company anticipates continued growth and expanding margins in its Latin America region, underpinned by improvements in Mexico and Argentina.  The Eastern Hemisphere also is expected to improve in 2013, with increases in Europe, Sub-Saharan Africa and Russia, as well as continued recovery in the Middle East/North Africa/Asia Pacific region.  For 2013, the company currently estimates an annual effective tax rate of approximately 34 percent.

 

North America
Revenues for the quarter were $1,682 million, a one percent decrease over the same quarter in the prior year and down $43 million or two percent sequentially. This was the result of the continued decline in U.S. land rig count and continued oversupply of hydraulic fracturing capacity.

The quarter's operating income was $226 million, down $155 million or 41% from the same quarter in the prior year and down $71 million, or 24 percent, sequentially. 

 

Middle East/North Africa/Asia Pacific
Fourth quarter revenues of $851 million were 26 percent higher than the fourth quarter of 2012 and $151 million or 22 percent higher sequentially.  The sequential and year-over-year increase in revenues was fairly broad-based and attributable to additional activity in Saudi Arabia, Kuwait and Oman.  

The current quarter's operating income of $58 million increased $24 million from the same quarter in the prior year and increased $22 million sequentially.

 

 

 

Europe/SSA/Russia
Fourth quarter revenues of $669 million were ten percent higher than the fourth quarter of 2011 and seven percent higher than the prior quarter.  The revenue growth, year-over-year, came primarily from Russia and in Europe from Romania and Norway. 

The current quarter's operating income of $59 million was down $21 million or 26 percent compared to the same quarter in the prior year and down $29 million or 33 percent from the prior quarter.  The current quarter was primarily impacted by a lower level of operating activity in Azerbaijan, SSA and the UK.

 

Latin America
Third quarter revenues of $856 million were $88 million or 11 percent higher than the third quarter of 2012 and up 18 percent compared to the fourth quarter of 2011.  The current quarter's operating income of $125 million increased ten percent compared to the same quarter in the prior year and increased 29 percent from the prior quarter. Mexico and Argentina were the primary drivers of the sequential increase in revenue and operating income.

 

Liquidity and Net Debt
Net debt for the quarter decreased $207 million sequentially, primarily as a result of a decrease in working capital of $111 million.  Days sales outstanding decreased to 86 days and days sales in inventory decreased to 81 days.   Along with the improvements in working capital, our capital expenditures of approximately $478 million, net of lost-in-hole, were down from $540 million sequentially.

Internal Control Matters
With the filing of its Form 10-K, the company expects to report that the previously reported material weakness in internal controls over financial reporting related to the accounting for a percentage of completion contract in Iraq has been remediated as of December 31, 2012.      

The company expects to report with the filing of its Form 10-K that it has not completed the remediation of the previously reported material weakness in internal controls over financial reporting related to income tax. In light of this material weakness we performed additional procedures designed to ensure that our consolidated financial statements are materially correct.

Non-GAAP Performance Measures
Non-GAAP performance measures and corresponding reconciliations to GAAP financial measures have been provided to offer 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 quarterly results on February 27, 2013 at 8:30 a.m. eastern standard time, 7:30 a.m. central standard time.  The company invites investors to listen to the call live via company's website, www.weatherford.com in the Investor Relations section.  A recording of the conference call and transcript of the call will be available on that section of the website shortly after the call ends.

Weatherford is a Swiss-based, multi-national oilfield service company.  It is one of the largest global providers of technology and services for the oil and gas industry. Weatherford operates in over 100 countries and employs over 70,000 people worldwide.

Contacts:

John H. Briscoe

+1.713.836.4610
 

Senior Vice President and Chief Financial Officer
     
 

Karen David-Green

+1.713.836.7430
 

Vice President – Investor Relations
   

Forward-Looking Statements
This press release and the documents referenced herein contain, and the conference call announced in this release may include, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This includes statements related to future levels of earnings, revenue, expenses, margins, capital expenditures, changes in working capital, cash flows, tax expense, effective tax rates and net income, as well as the prospects for the oilfield service business generally and our business in particular, as well as statements regarding timing or content of the financial information that will be filed with the SEC regarding the current period. Forward-looking statements also include any statements about the resolution or potential future resolution of our ongoing remediation of our material weaknesses in internal control over financial reporting for income taxes and for percentage of completion accounting and our assessment of the degree to which historical remediation efforts have been successful to date.  It is inherently difficult to make projections or other forward-looking statements in a cyclical industry and given the current macroeconomic uncertainty. Such statements are based upon the current beliefs of Weatherford's management, and are subject to significant risks, assumptions and uncertainties. These include the company's ability to complete all processes necessary to the issuance of revised financial statements, including obtaining an audit opinion from its independent auditors, the company's  inability to design or improve internal controls to address identified issues; the impact upon operations of legal compliance matters or internal controls review, improvement and remediation, including the detection of wrongdoing, improper activities or circumvention of internal controls; difficulties in controlling expenses, including costs of legal compliance matters or internal controls review, improvement and remediation; impact of changes in management or staff levels, the effect of global political, economic and market conditions on the company's projected results; the possibility that the company may be unable to recognize expected revenues from current and future contracts; the effect of currency fluctuations on the company's business; the company's ability to manage its workforce to control costs; the cost and availability of raw materials, the company's ability to manage its supply chain and business processes; the company's ability to commercialize new technology; whether the company can realize expected benefits from its redomestication of its former Bermuda parent company; the company's ability to realize expected benefits from its acquisitions and dispositions; the effect of a downturn in its industry on the company's carrying value of its goodwill; the effect of weather conditions on the company's operations; the impact of oil and natural gas prices and worldwide economic conditions on drilling activity; the effect of turmoil in the credit markets on the company's ability to manage risk with interest rate and foreign exchange swaps; the outcome of pending government investigations, including the Securities and Exchange Commission's investigation of the circumstances surrounding the company's material weakness in its internal control over financial reporting of income taxes; the outcome of ongoing litigation, including shareholder litigation related to the company's material weakness in its internal control over financial reporting of income taxes and its restatement of historical financial statements; the future level of crude oil and natural gas prices; demand for our products and services; levels of pricing for our products and services; utilization rates of our equipment; the effectiveness of our supply chain; weather-related disruptions and other operational and non-operational risks that are detailed in our most recent Form 10-K and other filings with the U.S. Securities and Exchange Commission. 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. Specifically, statements regarding the current period assume that there will be no subsequent events or other adverse developments after the date of this press release that cause our financial statements for the current period, when filed with the SEC, to vary materially from the amounts herein.  We undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.  

 

 

 

Weatherford International Ltd.

Consolidated Condensed Statements of Operations

(Unaudited)

(In Millions)
                     
                       
     

Three Months Ended  

  

Year Ended
       

12/31/2012

  

12/31/2011

  

12/31/2012

  

12/31/2011
                     
                     

Net Revenues:

                  
 

North America

    

$      1,682

  

$      1,700

  

$      6,824

  

$      6,023
 

Middle East/North Africa/Asia 

    

851

  

675

  

2,795

  

2,441
 

Europe/SSA/Russia

    

669

  

609

  

2,519

  

2,298
 

Latin America

    

856

  

726

  

3,077

  

2,226
       

4,058

  

3,710

  

15,215

  

12,988
                     

Operating Income (Expense):

                  
 

North America

    

226

  

381

  

1,107

  

1,259
 

Middle East/North Africa/Asia 

    

58

  

34

  

171

  

92
 

Europe/SSA/Russia

    

59

  

80

  

315

  

287
 

Latin America

    

125

  

114

  

395

  

254
 

Research and Development

    

(63)

  

(64)

  

(257)

  

(245)
 

Corporate Expenses

    

(49)

  

(44)

  

(196)

  

(177)
 

Libya Reserve

    

-

  

(67)

  

-

  

(67)
 

Goodwill and Equity Investment Impairment

    

-

  

-

  

(793)

  

-
 

Sanctioned Country Loss Contingency

    

-

  

-

  

(100)

  

-
 

Other Items

    

(111)

  

(38)

  

(344)

  

(96)
       

245

  

396

  

298

  

1,307
                     

Other Income (Expense):

                  
 

Interest Expense, Net

    

(126)

  

(112)

  

(486)

  

(453)
 

Other, Net

    

(30)

  

(40)

  

(100)

  

(107)
                     

Income (Loss) Before Income Taxes

  

89

  

244

  

(288)

  

747
                     

Benefit (Provision) for Income Taxes:

                
 

Provision for Operations

    

(184)

  

(242)

  

(471)

  

(544)
 

Adjustments to Provision

    

(19)

  

(9)

  

9

  

2
       

(203)

  

(251)

  

(462)

  

(542)
                     

Net Income (Loss)

    

(114)

  

(7)

  

(750)

  

205

Net Income Attributable to Noncontrolling Interests

  

(8)

  

(6)

  

(28)

  

(16)

Net Income (Loss) Attributable to Weatherford

    

$       (122)

  

$         (13)

  

$       (778)

  

$         189
                     

Earnings Per Share Attributable to Weatherford

                
 

Basic

    

$      (0.16)

  

$      (0.02)

  

$      (1.02)

  

$        0.25
 

Diluted 

    

$      (0.16)

  

$      (0.02)

  

$      (1.02)

  

$        0.25
                     

Weighted Average Shares Outstanding:

                
 

Basic

    

768

  

758

  

765

  

753
 

Diluted 

    

768

  

758

  

765

  

760

 

 

 

 

Weatherford International Ltd.

Selected Statements of Operations Information

(Unaudited)

(In Millions)
                       
                       
     

Three Months Ended
     

12/31/2012

  

9/30/2012

  

6/30/2012

  

3/31/2012

  

12/31/2011
                       

Net Revenues:

                  
 

North America

$     1,682

  

$   1,725

  

$   1,663

  

$   1,754

  

$     1,700
 

Middle East/North Africa/Asia 

851

  

700

  

649

  

595

  

675
 

Europe/SSA/Russia

669

  

626

  

653

  

571

  

609
 

Latin America

856

  

768

  

782

  

671

  

726
     

$     4,058

  

$   3,819

  

$   3,747

  

$   3,591

  

$     3,710
                       
                       
     

Three Months Ended
     

12/31/2012

  

9/30/2012

  

6/30/2012

  

3/31/2012

  

12/31/2011
                       

Operating Income (Expense):

                  
 

North America

$        226

  

$      297

  

$      226

  

$      358

  

$        381
 

Middle East/North Africa/Asia 

58

  

36

  

24

  

53

  

34
 

Europe/SSA/Russia

59

  

88

  

102

  

66

  

80
 

Latin America

125

  

97

  

90

  

83

  

114
 

Research and Development

(63)

  

(68)

  

(64)

  

(62)

  

(64)
 

Corporate Expenses 

(49)

  

(48)

  

(49)

  

(50)

  

(44)
 

Libya Reserve

-

  

-

  

-

  

-

  

(67)
 

Goodwill and Equity Investment Impairment

-

  

-

  

(793)

  

-

  

-
 

Sanctioned Country Loss Contingency

-

  

-

  

(100)

  

-

  

-
 

Other Items

(111)

  

(87)

  

(68)

  

(78)

  

(38)
     

$        245

  

$      315

  

$     (632)

  

$      370

  

$        396
                       
                       
     

Three Months Ended
     

12/31/2012

  

9/30/2012

  

6/30/2012

  

3/31/2012

  

12/31/2011
                       

Product Line Revenues:

                  
 

Formation Evaluation and Well Construction(1)

$     2,348

  

$   2,128

  

$   2,058

  

$   2,034

  

$     2,074
 

Completion and Production(2)

1,710

  

1,691

  

1,689

  

1,557

  

1,636
     

$     4,058

  

$   3,819

  

$   3,747

  

$   3,591

  

$     3,710
                       
                       
     

Three Months Ended
     

12/31/2012

  

9/30/2012

  

6/30/2012

  

3/31/2012

  

12/31/2011
                       

Depreciation and Amortization:

                  
 

North America

$        108

  

$      108

  

$      101

  

$        95

  

$          90
 

Middle East/North Africa/Asia 

94

  

90

  

85

  

83

  

82
 

Europe/SSA/Russia

71

  

63

  

60

  

61

  

59
 

Latin America

63

  

61

  

59

  

55

  

52
 

Research and Development and Corporate

7

  

7

  

6

  

5

  

6
     

$        343

  

$      329

  

$      311

  

$      299

  

$        289
                       
 

(1)

Formation Evaluation and Well Construction includes Drilling Services, Well Construction, Integrated Drilling, Wireline and Evaluation Services, Drilling Tools and Fishing and Re-entry.
 

(2)

Completion and Production includes Artificial Lift Systems, Stimulation and Chemicals, Completion Systems and Pipeline and Specialty Services

 

 

We report our financial results in accordance with generally accepted accounting principles (GAAP).  However, Weatherford's management believes that certain non-GAAP financial measures and ratios (as defined under the SEC's Regulation G) may provide users of this financial information additional meaningful comparisons between current results and results in prior periods.   The non-GAAP financial measures we may present from time to time include: 1) operating income or income from continuing operations excluding certain charges or amounts, 2) the provision for income taxes excluding discrete items and 3) the resulting non-GAAP net income and per share amounts.  These adjusted amounts are not measures of financial performance under GAAP.  Accordingly, these amounts should not be considered as a substitute for operating income, provision for income taxes, net income or other data prepared and reported in accordance with GAAP.  See the table below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended December 31, 2012, September 30, 2012, and December 31, 2011 and for the years ended December 31, 2012 and 2011.  Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, the Company's reported results prepared in accordance with GAAP.

 

Weatherford International Ltd.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(In Millions, Except Per Share Amounts)
                             
       

Three Months Ended

    

Twelve Months Ended

  
       

12/31/2012

  

9/30/2012

  

12/31/2011

    

12/31/2012

  

12/31/2011

  

Operating Income:

                        
 

GAAP Operating Income

  

$         245

  

$       315

  

$         396

    

$         298

  

$      1,307

  
   

Goodwill and Equity Investment Impairment

  

-

  

-

  

-

    

793

  

-

  
   

Sanctioned Country Loss Contingency

  

-

  

-

  

-

    

100

  

-

  
   

Legacy Contracts

  

30

  

14

  

(5)

    

137

  

(13)

  
   

Libya Reserve

  

-

  

-

  

67

    

-

  

67

  
   

Other Adjustments

  

31

  

46

  

26

    

104

  

74

  
   

Tax Remediation and Restatement Expenses

  

50

  

27

  

12

    

103

  

22

  
 

Non-GAAP Operating Income

  

$         356

  

$       402

  

$         496

    

$      1,535

  

$      1,457

  
                           
                           

Income (Loss) Before Income Taxes:

                        
 

GAAP Income (Loss) Before Income Taxes

  

$           89

  

$       163

  

$         244

    

$       (288)

  

$         747

  
   

Goodwill and Equity Investment Impairment

  

-

  

-

  

-

    

793

  

-

  
   

Sanctioned Country Loss Contingency

  

-

  

-

  

-

    

100

  

-

  
   

Legacy Contracts

  

30

  

14

  

(5)

    

137

  

(13)

  
   

Libya Reserve

  

-

  

-

  

67

    

-

  

67

  
   

Other Adjustments

  

31

  

46

  

31

    

101

  

79

  
   

Tax Remediation and Restatement Expenses

  

50

  

27

  

12

    

103

  

22

  
 

Non-GAAP Income (Loss) Before Income Taxes

  

$         200

  

$       250

  

$         349

    

$         946

  

$         902

  
                             
                             

Benefit (Provision) for Income Taxes:

                        
 

GAAP Benefit (Provision) for Income Taxes

  

$       (203)

  

$       (86)

  

$       (251)

    

$       (462)

  

(542)

  
   

Goodwill and Equity Investment Impairment

  

-

  

-

  

-

    

(1)

  

-

  
   

Sanctioned Country Loss Contingency

  

-

  

-

  

-

    

(1)

  

-

  
   

Legacy Contracts

  

34

  

-

  

-

    

34

  

-

  
   

Other Adjustments

  

(8)

  

(14)

  

(7)

    

(25)

  

(14)

  
   

Tax Remediation and Restatement Expenses

  

(7)

  

(3)

  

(6)

    

(16)

  

(10)

  
   

Legal Entity Reorganization Charges

  

-

  

-

  

22

    

-

  

22

  
 

Non-GAAP Benefit (Provision) for Income Taxes

  

$       (184)

  

$     (103)

  

$       (242)

    

$       (471)

  

$       (544)

  
                             
                             

Net Income (Loss) Attributable to Weatherford:

                        
 

GAAP Net Income (Loss)

  

$       (122)

  

$         70

  

$         (13)

    

$       (778)

  

$         189

  
   

Total Charges, net of tax

  

130

(a)

70

(b)

114

(c)

  

1,225

(d)

153

(e)
 

Non-GAAP Net Income

  

$             8

  

$       140

  

$         101

    

$         447

  

$         342

  
                             
                             

Diluted Earnings (Loss) Per Share Attributable to Weatherford:

                      
 

GAAP Diluted Earnings (Loss) per Share

  

$      (0.16)

  

$      0.09

  

$      (0.02)

    

$      (1.02)

  

$        0.25

  
   

Total Charges, net of tax

  

0.17

  

0.09

  

0.15

    

1.60

  

0.20

  
 

Non-GAAP Diluted Earnings per Share  

  

$        0.01

  

$      0.18

  

$        0.13

    

$        0.58

  

$        0.45

  
                             
                             
 

GAAP Effective Tax Rate (f)

  

228%

  

53%

  

103%

    

-160%

  

73%

  
 

Annual Effective Tax Rate (g)

  

92%

  

41%

  

69%

    

50%

  

60%

  
                             
                             

 

Note (a):  Non-GAAP adjustments are comprised of (i) tax restatement and remediation expenses of $43 million, (ii) $64 million in operating losses and tax expense related to legacy lump sum contracts in Iraq, (iii) $23 million in other adjustments consisting of severance and other charges including $7 million in investigation related expenses.
 

Note (b):  Non-GAAP adjustments are comprised of (i) tax restatement and remediation expenses of $23 million, (ii) $14 million in operating losses related to legacy lump sum contracts in Iraq, (iii) $33 million in other adjustments including $11 million in fees and expenses associated with our Q3 debt consent solicitation, a $18 million lower of cost or market adjustment to the carrying value of our inventory and $4 million in severance, exit and other charges.
 

Note (c): Non-GAAP adjustments are comprised of (i) a $67 million charge primarily to reserve accounts receivable, inventory and machinery and equipment in Libya (ii) $22 million in withholding taxes and legal and professional costs incurred in conjunction with our tax planning activities,(iii) $6 million in tax material weakness remediation and restatement expenses and (v) severance, exit and other charges of $19 million.   
 

Note (d): Non-GAAP adjustments are comprised of (i) goodwill and equity method investment impairments of $793 million, (ii) $100 million loss accrual related to sanctioned country matters, (iii) tax restatement and remediation expenses of $87 million, (iv) $171 million in operating losses and tax expense related to legacy lump sum contracts in Iraq, (v) $74 million in severance, exit and other charges including $11 million in fees and expenses associated with our Q3 debt consent solicitation, $19 million in lower of cost or market adjustments to the carrying value of our inventory and $9 million in investigation related expenses.
 

Note (e): Non-GAAP adjustments are comprised of (i) a $67 million charge primarily to reserve accounts receivable, inventory and machinery and equipment in Libya (ii) $22 million in withholding taxes and legal and professional costs incurred in conjunction with our tax planning activities (iii) $12 million in tax material weakness remediation and restatement expenses and (v) severance, exit and other charges of $52 million, including $10 million  incurred in conjunction with the ongoing investigations and $9 million associated with the termination of a corporate consulting contract.  
 

Note (f): GAAP Effective Tax Rate is GAAP provision for income taxes divided by GAAP income before income taxes.
 

Note (g): Annual Effective Tax Rate is the Non-GAAP provision for income taxes divided by Non-GAAP income before income taxes.

 

 

 

Weatherford International Ltd.

Selected Balance Sheet Data

(Unaudited)

(In Millions)
                         
                         
                         
       

12/31/2012

  

9/30/2012

  

6/30/2012

  

3/31/2012

  

12/31/2011
                         
                         

Assets:

                    
 

Cash and Cash Equivalents

  

$         300

  

$       365

  

$       381

  

$       339

  

$         371
 

Accounts Receivable, Net

  

3,885

  

3,911

  

3,608

  

3,358

  

3,233
 

Inventories, Net

  

3,675

  

3,676

  

3,399

  

3,301

  

3,158
 

Property, Plant and Equipment, Net

  

8,299

  

8,122

  

7,733

  

7,591

  

7,287
 

Goodwill and Intangibles, Net

  

4,637

  

4,653

  

4,581

  

5,152

  

5,134
 

Equity Investments

  

646

  

642

  

629

  

634

  

616
                         
                         

Liabilities:

                    
 

Accounts Payable

  

$      2,108

  

$    2,023

  

$    1,635

  

$    1,684

  

$      1,571
 

Short-term Borrowings and Current Portion of 

                    
   

Long-term Debt

  

1,585

  

1,606

  

1,263

  

1,902

  

1,320
 

Long-term Debt

  

7,049

  

7,300

  

7,311

  

5,989

  

6,286

 

 

 

 

Weatherford International Ltd.

    
 

Net Debt

    
 

(Unaudited)

    
 

(In Millions)

    
               
               

Change in Net Debt for the Three Months Ended 12/31/2012:

            
 

Net Debt at 9/30/2012

  

$            (8,541)

        
   

Operating Income

  

245

        
   

Depreciation and Amortization

  

343

        
   

Other Items

  

111

        
   

Capital Expenditures

  

(507)

        
   

Decrease in Working Capital 

  

111

        
   

Income Taxes Paid

  

(174)

        
   

Interest Paid

  

(77)

        
   

Acquisitions and Divestitures of Assets and Businesses, Net

  

19

        
   

Other

  

136

        
 

Net Debt at 12/31/2012

  

$            (8,334)

        
                 

Change in Net Debt for the Twelve Months Ended 12/31/2012:

            
 

Net Debt at 12/31/2011

  

$            (7,235)

        
   

Operating Income

  

298

        
   

Depreciation and Amortization

  

1,282

        
   

Goodwill and Investment Impairment

  

793

        
   

Sanctioned Country Loss Contingency

  

100

        
   

Other Items

  

344

        
   

Capital Expenditures

  

(2,177)

        
   

Increase in Working Capital 

  

(632)

        
   

Income Taxes Paid

  

(443)

        
   

Interest Paid

  

(478)

        
   

Acquisitions and Divestitures of Assets and Businesses, Net

  

(112)

        
   

Other

  

(74)

        
 

Net Debt at 12/31/2012

  

$            (8,334)

        
                 
                 
                 
                   
 

Components of Net Debt

  

12/31/2012

  

9/30/2012

  

12/31/2011
   

Cash

  

$                300

  

$                365

  

$                371
   

Short-term Borrowings and Current Portion of Long-term Debt

  

(1,585)

  

(1,606)

  

(1,320)
   

Long-term Debt

  

(7,049)

  

(7,300)

  

(6,286)
   

Net Debt

  

$            (8,334)

  

$            (8,541)

  

$            (7,235)

 

"Net Debt" is debt less cash.  Management believes that Net Debt provides useful information regarding the level of Weatherford indebtedness by reflecting cash that could be used to repay debt.
 

Working capital is defined as accounts receivable plus inventory less accounts payable.

 

 

 

SOURCE Weatherford International Ltd.