HALLIBURTON COMPANY (NYSE:HAL) Files An 8-K Results of Operations and Financial Condition

HALLIBURTON COMPANY (NYSE:HAL) Files An 8-K Results of Operations and Financial Condition
Item 2.02. Results of Operations and Financial Condition

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On October22, 2018, registrant issued a press release entitled “Halliburton Announces Third Quarter 2018 Results."

The text of the Press Release is as follows:

HALLIBURTON ANNOUNCES THIRD QUARTER 2018 RESULTS

Income from continuing operations of $0.50 per diluted share

HOUSTON – October22, 2018 – Halliburton Company (NYSE:HAL) announced today income from continuing operations of $435 million, or $0.50 per diluted share, for the third quarter of 2018. This compares to income from continuing operations for the second quarter of 2018 of $511 million, or $0.58 per diluted share. Operating income was $716 million during the third quarter of 2018, compared to operating income of $789 million in the second quarter of 2018.

Halliburton released the iCruise™ Intelligent Rotary Steerable System (RSS), a breakthrough technology that delivers faster drilling, more accurate steering, and longer laterals. The iCruise System provides the highest mechanical specifications available in the market today with 400 RPM and up to 18 degrees/100 feet dogleg capabilities to drill fast and with greater accuracy.

Halliburton unveiled Prodigi™ AB Service, a first-of-its-kind offering that introduces automation to hydraulic fracturing to achieve a lower cost per BOE. By automating the breakdown process of a fracturing treatment, Prodigi AB Service helps deliver better well performance. It also helps improve overall efficiency, maximize the performance of perforation clusters, and mitigate the risk of screen-out.

Halliburton announced the acquisition of GOHFER® Fracture Modeling Software, the leading fracture simulation software in the business. GOHFER Software is used globally for conventional and unconventional well completion design, analysis and optimization.

Halliburton released the Xaminer® Magnetic Resonance (XMR™) Service, the industry’s only high pressure rated (35,000 psi) downhole sensor that provides comprehensive nuclear magnetic resonance measurements to improve reservoir insight. The XMR Service delivers detailed formation data, including 2D and 3D fluid characterization, carbonate pore size classification, unconventional analysis, and permeability.

Halliburton introduced MicroScout® Plus Service, designed to take hydraulic fracturing and microfracture stimulation to the next level by reaching and effectively stimulating secondary microfractures too small to be propped using conventional frac sand. The enhanced sand suspension characteristics offered by the MicroScout Plus Service offer deeper penetration into the formation and extended conductive complexity, aimed at increasing the productivity of stimulated reservoir volume over the long term.

Halliburton announced that its XtremeGrip™ liner hangers have been installed to a record depth of 30,924 feet in the Gulf of Mexico Hess-operated Stampede deepwater development. Halliburton has installed a total of 37 XtremeGrip expandable liner hangers across seven wells to date, with no liner-top leaks or remedial work required.

About Halliburton

Founded in 1919, Halliburton is one of the world's largest providers of products and services to the energy industry. With over 55,000 employees, representing 140 nationalities in more than 80 countries, the Company helps its customers maximize value 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 throughout the life of the asset. Visit the Company’s website at www.halliburton.com. Connect with Halliburton on Facebook, Twitter, LinkedIn, Instagram and YouTube.

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: the continuation or suspension of our stock repurchase program, the amount, the timing and the trading prices of Halliburton common stock, and the availability and alternative uses of cash; changes in the demand for or price of oil and/or natural gas; potential catastrophic events related to our operations, and related 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 oil and natural gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; the impact of federal tax reform, 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, foreign exchange rates and controls, international trade and regulatory controls and sanctions, 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; structural changes and infrastructure issues in the oil and natural gas industry; maintaining a highly skilled workforce; availability and cost of raw materials; agreement with respect to and completion of potential acquisitions and integration and success of acquired businesses and operations of joint ventures. Halliburton's Form 10-K for the year ended December 31, 2017, Form 10-Q for the quarter ended June 30, 2018, 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

Revenue:

Completion and Production

$

4,170

$

3,537

$

4,164

Drilling and Evaluation

2,002

1,907

1,983

Total revenue

$

6,172

$

5,444

$

6,147

Operating income:

Completion and Production

$

$

$

Drilling and Evaluation

Corporate and other

(78

)

(71

)

(71

)

Total operating income

$

$

$

Interest expense, net

(140

)

(115

)

(137

)

Other, net

(42

)

(31

)

(19

)

Income from continuing operations before income taxes

$

$

$

Income tax provision

(100

)

(135

)

(125

)

Net income

$

$

$

Net loss attributable to noncontrolling interest

Net income attributable to company

$

$

$

Basic and diluted net income per share

$

0.50

$

0.42

$

0.58

Basic weighted average common shares outstanding

Diluted weighted average common shares outstanding

HALLIBURTON COMPANY

Condensed Consolidated Statements of Operations

(Millions of dollars and shares except per share data)

(Unaudited)

Nine Months Ended

September 30

Revenue:

Completion and Production

$

12,141

$

9,273

Drilling and Evaluation

5,918

5,407

Total revenue

$

18,059

$

14,680

Operating income:

Completion and Production

$

1,782

$

1,071

Drilling and Evaluation

Corporate and other

(218

)

(251

)

Impairments and other charges (a)

(265

)

(262

)

Total operating income

$

1,859

$

Interest expense, net (b)

(417

)

(478

)

Other, net

(86

)

(75

)

Income from continuing operations before income taxes

$

1,356

$

Income tax provision (c)

(367

)

(81

)

Net income

$

$

Net loss attributable to noncontrolling interest

Net income attributable to company

$

$

Basic net income per share

$

1.13

$

0.42

Diluted net income per share

$

1.13

$

0.41

Basic weighted average common shares outstanding

Diluted weighted average common shares outstanding

(a) During the nine months ended September 30, 2018, Halliburton recognized a pre-tax charge of $265 million related to a write-down of its remaining investment in Venezuela, consisting of receivables, fixed assets, inventory and other assets and liabilities. During the nine months ended September 30, 2017, Halliburton recognized a $262 million fair market value adjustment related to Venezuela.

(b) Includes $104 million of costs related to the early extinguishment of $1.4 billion of senior notes in the nine months ended September 30, 2017.

(c) Includes $47 million of accrued taxes in Venezuela for the charge taken during the nine months ended September 30, 2018.

HALLIBURTON COMPANY

Condensed Consolidated Balance Sheets

(Millions of dollars)

(Unaudited)

September 30

December 31

Assets

Current assets:

Cash and equivalents

$

2,057

$

2,337

Receivables, net

5,526

5,036

Inventories

2,887

2,396

Other current assets

1,008

Total current assets

11,436

10,777

Property, plant and equipment, net

8,821

8,521

Goodwill

2,800

2,693

Deferred income taxes

1,128

1,230

Other assets

1,566

1,864

Total assets

$

25,751

$

25,085

Liabilities and Shareholders’ Equity

Current liabilities:

Accounts payable

$

3,142

$

2,554

Accrued employee compensation and benefits

Short-term borrowings and current maturities of long-term debt

Other current liabilities

1,054

1,050

Total current liabilities

4,953

4,862

Long-term debt

10,424

10,430

Employee compensation and benefits

Other liabilities

Total liabilities

16,734

16,736

Company shareholders’ equity

8,998

8,322

Noncontrolling interest in consolidated subsidiaries

Total shareholders’ equity

9,017

8,349

Total liabilities and shareholders’ equity

$

25,751

$

25,085

HALLIBURTON COMPANY

Condensed Consolidated Statements of Cash Flows

(Millions of dollars)

(Unaudited)

Nine Months Ended

September 30

Cash flows from operating activities:

Net income

$

$

Adjustments to reconcile net income to cash flows from operating activities:

Depreciation, depletion and amortization

1,184

1,163

Working capital (a)

(372

)

(502

)

Impairments and other charges

Other

Total cash flows provided by operating activities

2,305

1,457

Cash flows from investing activities:

Capital expenditures

(1,475

)

(934

)

Payments to acquire businesses

(166

)

(628

)

Proceeds from sales of property, plant and equipment

Purchases of investment securities, net of sales

Other investing activities

(58

)

(56

)

Total cash flows used in investing activities

(1,439

)

(1,507

)

Cash flows from financing activities:

Dividends to shareholders

(473

)

(469

)

Payments on long-term borrowings

(436

)

(1,633

)

Stock repurchase program

(200

)

Other financing activities

Total cash flows used in financing activities

(1,081

)

(2,010

)

Effect of exchange rate changes on cash

(65

)

(51

)

Decrease in cash and equivalents

(280

)

(2,111

)

Cash and equivalents at beginning of period

2,337

4,009

Cash and equivalents at end of period

$

2,057

$

1,898

(a) Working capital includes receivables, inventories and accounts payable.

HALLIBURTON COMPANY

Revenue and Operating Income Comparison

By Operating Segment and Geographic Region

(Millions of dollars)

(Unaudited)

Three Months Ended

September 30

June 30

Revenue

By operating segment:

Completion and Production

$

4,170

$

3,537

$

4,164

Drilling and Evaluation

2,002

1,907

1,983

Total revenue

$

6,172

$

5,444

$

6,147

By geographic region:

North America

$

3,739

$

3,163

$

3,834

Latin America

Europe/Africa/CIS

Middle East/Asia

1,154

1,029

1,108

Total revenue

$

6,172

$

5,444

$

6,147

Operating Income

By operating segment:

Completion and Production

$

$

$

Drilling and Evaluation

Total

Corporate and other

(78

)

(71

)

(71

)

Total operating income

$

$

$

HALLIBURTON COMPANY

Revenue and Operating Income Comparison

By Operating Segment and Geographic Region

(Millions of dollars)

(Unaudited)

Nine Months Ended

September 30

Revenue

By operating segment:

Completion and Production

$

12,141

$

9,273

Drilling and Evaluation

5,918

5,407

Total revenue

$

18,059

$

14,680

By geographic region:

North America

$

11,090

$

8,164

Latin America

1,458

1,501

Europe/Africa/CIS

2,199

2,005

Middle East/Asia

3,312

3,010

Total revenue

$

18,059

$

14,680

Operating Income

By operating segment:

Completion and Production

$

1,782

$

1,071

Drilling and Evaluation

Total

2,342

1,504

Corporate and other

(218

)

(251

)

Impairments and other charges

(265

)

(262

)

Total operating income

$

1,859

$

Conference Call Details

Halliburton will host a conference call on Monday, October22, 2018, to discuss the third quarter 2018 financial results. The call will begin at 8:00 AM Central Time (9:00 AM Eastern Time).

Please visit the website to listen to the call live via webcast. Interested parties may also participate in the call by dialing (888) 393-0263 within North America or +1 (973) 453-2259 outside of North America. A passcode is not required. Attendees should log in to the webcast or dial in approximately 15 minutes prior to the call start time.

A replay of the conference call will be available on Halliburton’s website for seven days following the call. Also, a replay may be accessed by telephone at (855) 859-2056 within North America or +1 (404) 537-3406 outside of North America, using the passcode 6352269.

###

CONTACTS

For Investors:

Lance Loeffler

Halliburton, Investor Relations

[email protected]

281-871-2688

For Media:

Emily Mir

Halliburton, Public Relations

[email protected]

281-871-2601


About HALLIBURTON COMPANY (NYSE:HAL)

Halliburton Company is a provider of services and products to the upstream oil and natural gas industry. The Company operates through two segments: the Completion and Production segment, and the Drilling and Evaluation segment. The Company’s Completion and Production segment delivers cementing, stimulation, intervention, pressure control, specialty chemicals, artificial lift, and completion products and services. The Company’s Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation and wellbore placement solutions that enable customers to model, measure, drill and manage its well construction activities. The Company’s baroid provides drilling fluid systems, performance additives, completion fluids, solids control, specialized testing equipment and waste management services for oil and natural gas drilling, completion and workover operations. The Company operates its business in approximately 80 countries.

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