|
001-03492
|
No.
75-2677995
|
|
(Commission
File Number)
|
(IRS
Employer Identification No.)
|
|
3000
North Sam Houston Parkway East
Houston,
Texas
|
77032
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
|
·
|
Halliburton
has been awarded the integrated turnkey drilling contract in South
Ghawar. Located approximately 200 kilometers (124 miles) from
the city of Dhahran, the Ghawar field is the world's largest oil
field. The five-year contract, with an option for an additional
five-year period, calls for the provision of drilling rigs, directional
and horizontal drilling, logging while drilling, cementing, mud
engineering, wireline logging, completion, perforating, and other well
construction activities, including engineering and management of the
entire drilling operations. The project is expected to utilize three to
four rigs and will involve between 153 and 185 oil production, water
injection, and evaluation wells. This contract is Saudi
Aramco's first-ever award for an integrated turnkey drilling contract and
is an important part of Saudi Aramco's plan to explore new avenues of
collaboration with major oil field services
providers.
|
|
·
|
Halliburton
has been awarded a three-year contract by Total to provide drilling and
completion fluid solutions in Indonesia. The $122 million
contract is expected to begin in the Mahakam Delta during the first
quarter of 2010.
|
|
·
|
Halliburton
has been awarded a three-year technical cooperation agreement by Brazil’s
state energy company Petróleo Brasileiro (Petrobras) for research and
development in Brazil’s subsalt areas. Plans include up to 15
projects, including studies on contamination of fluids in oil wells,
laboratory simulation of well production, and research on salt and
carbon-dioxide formation cementation. A centerpiece of the
agreement will be the establishment of the Halliburton Brazil Technology
and Solutions Center in Rio de
Janeiro.
|
|
·
|
Halliburton
and SGS SA have entered into a Joint Cooperation Agreement combining
formation fluid sample acquisition and analysis
services. Halliburton will provide a comprehensive suite of
solutions for acquiring fluid samples, and SGS’ Oil, Gas and Chemicals
division will deliver a full range of fluid analysis
services. Through the agreement, clients will have access to
the industry’s most complete and innovative solutions, including portable
laboratory services for the acquisition, analysis, and independent quality
control of production and reservoir fluid samples. Customers
will get timely and impartial data to help with wellbore placement,
facility design and pipeline setup decisions. Halliburton and
SGS are currently providing the joint fluid sample collection and analysis
service to a client in offshore
Africa.
|
|
·
|
Halliburton
has acquired Geo-Logic Systems, LLC. Founded in 1983, Geo-Logic Systems is
the leading provider of advanced structural interpretation, analysis, and
restoration software for complex geologic
environments. Geo-Logic Systems’ software validates complex
geologic interpretations by determining their physical possibility using
its structural restoration and balancing capabilities. The software
assists in analyzing and modeling fault seal characteristics, burial
histories, and determining hydrocarbon migration pathways and accumulation
zones, thereby enabling Halliburton's customers to construct more accurate
geologic models.
|
|
·
|
Landmark,
a brand of Halliburton, recently launched GeoGraphix® Discovery™ 3D
software, the new Microsoft (NASDAQ: MSFT) Windows PC-based
offering incorporating state-of-the-art interactive visualization tools
from Microsoft's Xbox® gaming console and the 64-bit capabilities and
performance of the new Microsoft Windows 7 operating system. Using this
new member of the GeoGraphix product family, Discovery 3D software users
will have an immersive, game-like experience when developing geologic
interpretations. GeoGraphix Discovery 3D software is one of the
first oil and gas solutions leveraging the Microsoft Windows 7 operating
system as well as the latest DirectX® graphics technology, combined with
Microsoft Xbox gaming technology. The resulting product vastly
improves the way geoscientists interact with and manipulate 3D subsurface
models, allowing for faster, more accurate interpretations and
decisions.
|
|
·
|
Landmark,
a brand of Halliburton, announced that in partnership with Shell it had
completed the first of several critical deployments in the global rollout
of R5000 versions of Landmark software. The R5000 software
provides higher levels of data and application
integration. Engineering and drilling disciplines are more
tightly integrated with subsurface disciplines, enabling geological
(G&G) technical staff, interpreters, and engineers to visualize and
analyze larger geographic and more complex datasets within interpretation
and modeling applications.
|
|
Three
Months Ended
|
||||||||||||
|
December
31
|
September
30
|
|||||||||||
|
2009
|
2008
|
2009
|
||||||||||
|
Revenue:
(a)
|
||||||||||||
|
Completion
and Production
|
$ | 1,818 | $ | 2,552 | $ | 1,821 | ||||||
|
Drilling
and Evaluation
|
1,868 | 2,358 | 1,767 | |||||||||
|
Total
revenue
|
$ | 3,686 | $ | 4,910 | $ | 3,588 | ||||||
|
Operating income:
(a)
|
||||||||||||
|
Completion
and Production
|
$ | 170 | $ | 630 | $ | 240 | ||||||
|
Drilling
and Evaluation
|
312 | 558 | 283 | |||||||||
|
Corporate
and other
|
(54 | ) | (25 | ) | (49 | ) | ||||||
|
Total
operating income
|
428 | 1,163 | 474 | |||||||||
|
Interest
expense
|
(82 | ) | (48 | ) | (80 | ) | ||||||
|
Interest
income
|
4 | 4 | 3 | |||||||||
|
Other,
net
|
(4 | ) | (26 | ) | (4 | ) | ||||||
|
Income
from continuing operations before income taxes
|
346 | 1,093 | 393 | |||||||||
|
Provision
for income taxes
|
(98 | ) | (342 | ) | (124 | ) | ||||||
|
Income
from continuing operations
|
248 | 751 | 269 | |||||||||
|
Loss
from discontinued operations, net
|
(4 | ) | (308 | )(c) | (3 | ) | ||||||
|
Net
income
|
$ | 244 | $ | 443 | $ | 266 | ||||||
|
Noncontrolling
interest in net income of subsidiaries (b)
|
(1 | ) | 25 | (4 | ) | |||||||
|
Net
income attributable to company
|
$ | 243 | $ | 468 | $ | 262 | ||||||
|
Amounts
attributable to company shareholders:
|
||||||||||||
|
Income
from continuing operations
|
$ | 247 | $ | 776 | $ | 265 | ||||||
|
Loss
from discontinued operations, net
|
(4 | ) | (308 | )(c) | (3 | ) | ||||||
|
Net
income attributable to company
|
$ | 243 | $ | 468 | $ | 262 | ||||||
|
Basic
income per share attributable to company
|
||||||||||||
|
shareholders:
(d)
|
||||||||||||
|
Income
from continuing operations
|
$ | 0.27 | $ | 0.87 | $ | 0.29 | ||||||
|
Loss
from discontinued operations, net
|
– | (0.35 | )(c) | – | ||||||||
|
Net
income per share
|
$ | 0.27 | $ | 0.52 | $ | 0.29 | ||||||
|
Diluted
income per share attributable to company
|
||||||||||||
|
shareholders:
(d)
|
||||||||||||
|
Income
from continuing operations
|
$ | 0.27 | $ | 0.87 | $ | 0.29 | ||||||
|
Loss
from discontinued operations, net
|
– | (0.35 | )(c) | – | ||||||||
|
Net
income per share
|
$ | 0.27 | $ | 0.52 | $ | 0.29 | ||||||
|
Basic
weighted average common shares outstanding (d)
|
903 | 895 | 902 | |||||||||
|
Diluted
weighted average common shares outstanding (d)
|
906 | 896 | 904 | |||||||||
|
(a)
|
Prior
period segment information was reclassified to reflect the movement of
certain operations from the Completion and Production segment to the
Drilling and Evaluation
segment.
|
|
(b)
|
On
January 1, 2009, Halliburton adopted a new
accounting standard, the provisions of which, among others, requires the
recognition of noncontrolling interest (previously referred to as minority
interest) as equity in the condensed consolidated balance sheets and a
revised presentation of the condensed consolidated statements of
operations. All periods presented have been
restated.
|
|
(c)
|
Loss
from discontinued operations, net in the fourth quarter of 2008 included a
$303 million, or $0.34 per diluted share, charge related to the
settlements of the Department of Justice and Securities and Exchange
Commission Foreign Corrupt Practices Act
investigations.
|
|
(d)
|
On
January 1, 2009, Halliburton adopted an update to accounting standards
related to accounting for instruments granted in share-based payment
transactions as participating securities. This update provides
that unvested share-based payment awards that contain nonforfeitable
rights to dividends or dividend equivalents, whether paid or unpaid, are
participating securities and shall be included in the computation of both
basic and diluted earnings per share. Prior periods’ basic and
diluted earnings per share were restated. Upon adoption, both
basic and diluted earnings per share for the fourth quarter of 2008
decreased by $0.01 for net income. Both basic and diluted loss
per share for the fourth quarter of 2008 increased by $0.01 for
discontinued operations.
|
|
Year
Ended December 31
|
||||||||
|
2009
|
2008
|
|||||||
|
Revenue:
(a)
|
||||||||
|
Completion
and Production
|
$ | 7,419 | $ | 9,610 | ||||
|
Drilling
and Evaluation
|
7,256 | 8,669 | ||||||
|
Total
revenue
|
$ | 14,675 | $ | 18,279 | ||||
|
Operating income:
(a)
|
||||||||
|
Completion
and Production
|
$ | 1,016 | $ | 2,304 | ||||
|
Drilling
and Evaluation
|
1,183 | 1,970 | ||||||
|
Corporate
and other
|
(205 | ) | (264 | ) | ||||
|
Total
operating income
|
1,994 | 4,010 | ||||||
|
Interest
expense
|
(297 | ) | (167 | )(b) | ||||
|
Interest
income
|
12 | 39 | ||||||
|
Other,
net
|
(27 | ) | (33 | )(b) | ||||
|
Income
from continuing operations before income taxes
|
1,682 | 3,849 | ||||||
|
Provision
for income taxes
|
(518 | ) | (1,211 | ) | ||||
|
Income
from continuing operations
|
1,164 | 2,638 | ||||||
|
Loss
from discontinued operations, net
|
(9 | ) | (423 | )(c) | ||||
|
Net
income
|
$ | 1,155 | $ | 2,215 | ||||
|
Noncontrolling
interest in net income of subsidiaries (d)
|
(10 | ) | 9 | |||||
|
Net
income attributable to company
|
$ | 1,145 | $ | 2,224 | ||||
|
Amounts
attributable to company shareholders:
|
||||||||
|
Income
from continuing operations
|
$ | 1,154 | $ | 2,647 | ||||
|
Loss
from discontinued operations, net
|
(9 | ) | (423 | )(c) | ||||
|
Net
income attributable to company
|
$ | 1,145 | $ | 2,224 | ||||
|
Basic
income per share attributable to company
|
||||||||
|
shareholders:
(e)
|
||||||||
|
Income
from continuing operations
|
$ | 1.28 | $ | 3.00 | ||||
|
Loss
from discontinued operations, net
|
(0.01 | ) | (0.48 | )(c) | ||||
|
Net
income per share
|
$ | 1.27 | $ | 2.52 | ||||
|
Diluted
income per share attributable to company
|
||||||||
|
shareholders:
(e)
|
||||||||
|
Income
from continuing operations
|
$ | 1.28 | $ | 2.91 | ||||
|
Loss
from discontinued operations, net
|
(0.01 | ) | (0.46 | )(c) | ||||
|
Net
income per share
|
$ | 1.27 | $ | 2.45 | ||||
|
Basic
weighted average common shares outstanding (e)
|
900 | 883 | ||||||
|
Diluted
weighted average common shares outstanding (e)
|
902 | 909 | ||||||
|
(a)
|
Prior
period segment information was reclassified to reflect the movement of
certain operations from the Completion and Production segment to the
Drilling and Evaluation segment.
|
|
(b)
|
On
January 1, 2009, Halliburton adopted an update to accounting standards
related to convertible debt instruments that may be settled in cash upon
conversion (including partial cash settlement). This update
clarifies that convertible debt instruments that may be settled in cash
upon conversion, including partial cash settlement, should separately
account for the liability and equity components in a manner that will
reflect the entity’s nonconvertible debt borrowing rate when interest cost
is recognized in subsequent periods. Upon adoption, the
provisions were retroactively applied. As a result, $7 million
of additional non-cash interest expense was recorded in the year ended
December 31, 2008 and the $693 million loss to settle our convertible debt
recorded in the third quarter of 2008 was reversed and recorded to
additional paid-in capital.
|
|
(c)
|
Loss
from discontinued operations, net, in 2008, included $420 million in
charges, net of tax, or $0.46 per diluted share, related to adjustments of
the indemnities and guarantees provided to KBR, Inc. upon
separation.
|
|
(d)
|
On
January 1, 2009, Halliburton adopted a
new accounting standard, the provisions of which, among others, requires
the recognition of noncontrolling interest (previously referred to as
minority interest) as equity in the condensed consolidated balance sheets
and a revised presentation of the condensed consolidated statements of
operations. All periods presented have been
restated.
|
|
(e)
|
On
January 1, 2009, Halliburton adopted an update to accounting standards
related to accounting for instruments granted in share-based payment
transactions as participating securities. This update provides
that unvested share-based payment awards that contain nonforfeitable
rights to dividends or dividend equivalents, whether paid or unpaid, are
participating securities and shall be included in the computation of both
basic and diluted earnings per share. Prior periods’ basic and
diluted earnings per share were restated. Upon adoption, basic
income
per share for 2008 decreased by $0.02 for continuing operations and
diluted income per share decreased by $0.01 for continuing
operations. In addition, basic loss per share decreased by
$0.01 for discontinued operations. Both basic and diluted
earnings per share decreased by $0.01 for net
income.
|
|
December
31
|
||||||||
|
2009
|
2008
|
|||||||
|
Assets
|
||||||||
|
Current
assets:
|
||||||||
|
Cash
and equivalents
|
$ | 2,082 | $ | 1,124 | ||||
|
Receivables,
net
|
2,964 | 3,795 | ||||||
|
Inventories,
net
|
1,598 | 1,828 | ||||||
|
Investments
in marketable securities
|
1,312 | – | ||||||
|
Other
current assets
|
682 | 664 | ||||||
|
Total
current assets
|
8,638 | 7,411 | ||||||
|
Property,
plant, and equipment, net
|
5,759 | 4,782 | ||||||
|
Goodwill
|
1,100 | 1,072 | ||||||
|
Other
assets
|
1,041 | 1,120 | ||||||
|
Total
assets
|
$ | 16,538 | $ | 14,385 | ||||
|
Liabilities
and Shareholders’ Equity
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 787 | $ | 898 | ||||
|
Current
maturities of long-term debt
|
750 | 26 | ||||||
|
Accrued
employee compensation and benefits
|
514 | 643 | ||||||
|
Other
current liabilities
|
838 | 1,214 | ||||||
|
Total
current liabilities
|
2,889 | 2,781 | ||||||
|
Long-term
debt
|
3,824 | 2,586 | ||||||
|
Other
liabilities
|
1,068 | 1,274 | ||||||
|
Total
liabilities
|
7,781 | 6,641 | ||||||
|
Company’s
shareholders’ equity
|
8,728 | 7,725 | ||||||
|
Noncontrolling
interest in consolidated subsidiaries (a)
|
29 | 19 | ||||||
|
Total
shareholders’ equity
|
8,757 | 7,744 | ||||||
|
Total
liabilities and shareholders’ equity
|
$ | 16,538 | $ | 14,385 | ||||
|
(a)
|
On
January 1, 2009, Halliburton adopted a
new accounting standard, the provisions of which, among others, requires
the recognition of noncontrolling interest (previously referred to as
minority interest) as equity in the condensed consolidated balance sheets
and a revised presentation of the condensed consolidated statements of
operations. All periods presented have been
restated.
|
|
Year
Ended
|
||||||||
|
December
31
|
||||||||
|
2009
|
2008
|
|||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
income
|
$ | 1,155 | $ | 2,215 | (a) | |||
|
Adjustments
to reconcile net income to net cash from operations:
|
||||||||
|
Depreciation,
depletion, and amortization
|
931 | 738 | ||||||
|
Loss
from discontinued operations
|
9 | 423 | ||||||
|
Payments
of Department of Justice and Securities and Exchange
Commission
|
||||||||
|
settlement and
indemnity
|
(417 | ) | – | |||||
|
Other
|
728 | (702 | ) | |||||
|
Total
cash flows from operating activities
|
2,406 | 2,674 | ||||||
|
Cash
flows from investing activities:
|
||||||||
|
Sales
(purchases) of investments in marketable securities, net
|
(1,320 | ) | 388 | |||||
|
Capital
expenditures
|
(1,864 | ) | (1,824 | ) | ||||
|
Acquisitions
of assets, net of cash acquired
|
(55 | ) | (652 | ) | ||||
|
Other
|
154 | 232 | ||||||
|
Total
cash flows from investing activities
|
(3,085 | ) | (1,856 | ) | ||||
|
Cash
flows from financing activities:
|
||||||||
|
Proceeds
from long-term borrowings, net of offering costs
|
1,975 | 1,187 | ||||||
|
Payments
of dividends to shareholders
|
(324 | ) | (319 | ) | ||||
|
Payments
on long-term borrowings
|
(31 | ) | (2,048 | ) | ||||
|
Payments
to reacquire common stock
|
(17 | ) | (507 | ) | ||||
|
Other
|
67 | 164 | ||||||
|
Total
cash flows from financing activities
|
1,670 | (1,523 | ) | |||||
|
Effect
of exchange rate changes on cash
|
(33 | ) | (18 | ) | ||||
|
Increase
(decrease) in cash and equivalents
|
958 | (723 | ) | |||||
|
Cash
and equivalents at beginning of period
|
1,124 | 1,847 | ||||||
|
Cash
and equivalents at end of period
|
$ | 2,082 | $ | 1,124 | ||||
|
(a)
|
On
January 1, 2009, Halliburton adopted an update to accounting standards
related to accounting for convertible debt instruments that may be settled
in cash upon conversion (including partial cash
settlement). This update clarifies that convertible debt
instruments that may be settled in cash upon conversion, including partial
cash settlement, should separately account for the liability and equity
components in a manner that will reflect the entity’s nonconvertible debt
borrowing rate when interest cost is recognized in subsequent
periods. Upon adoption, the provisions were retroactively
applied. As a result, $7 million of additional non-cash
interest expense was recorded in the year ended December 31, 2008 and the
$693 million loss to settle our convertible debt recorded in the third
quarter of 2008 was reversed and recorded to additional paid-in
capital.
|
|
|
-more-
|
|
Revenue
and Operating Income Comparison
|
|
By
Segment and Geographic Region
|
|
(Millions
of dollars)
|
|
(Unaudited)
|
|
Three
Months Ended
|
||||||||||||
|
December
31
|
September
30
|
|||||||||||
|
Revenue
by geographic region:
|
2009
|
2008
|
2009
|
|||||||||
|
Completion
and Production:
|
||||||||||||
|
North America
|
$ | 916 | $ | 1,442 | $ | 807 | ||||||
|
Latin America
|
205 | 258 | 223 | |||||||||
|
Europe/Africa/CIS
|
423 | 497 | 483 | |||||||||
|
Middle East/Asia
|
274 | 355 | 308 | |||||||||
|
Total
|
1,818 | 2,552 | 1,821 | |||||||||
|
Drilling
and Evaluation:
|
||||||||||||
|
North America
|
519 | 800 | 478 | |||||||||
|
Latin America
|
334 | 414 | 319 | |||||||||
|
Europe/Africa/CIS
|
574 | 643 | 529 | |||||||||
|
Middle East/Asia
|
441 | 501 | 441 | |||||||||
|
Total
|
1,868 | 2,358 | 1,767 | |||||||||
|
Total
revenue by region:
|
||||||||||||
|
North America
|
1,435 | 2,242 | 1,285 | |||||||||
|
Latin America
|
539 | 672 | 542 | |||||||||
|
Europe/Africa/CIS
|
997 | 1,140 | 1,012 | |||||||||
|
Middle East/Asia
|
715 | 856 | 749 | |||||||||
|
Operating
income by geographic region
|
||||||||||||
|
(excluding
Corporate and other):
|
||||||||||||
|
Completion
and Production:
|
||||||||||||
|
North America
|
$ | 45 | $ | 384 | $ | 9 | ||||||
|
Latin America
|
20 | 51 | 45 | |||||||||
|
Europe/Africa/CIS
|
62 | 110 | 107 | |||||||||
|
Middle East/Asia
|
43 | 85 | 79 | |||||||||
|
Total
|
170 | 630 | 240 | |||||||||
|
Drilling
and Evaluation:
|
||||||||||||
|
North America
|
58 | 155 | 28 | |||||||||
|
Latin America
|
28 | 101 | 52 | |||||||||
|
Europe/Africa/CIS
|
109 | 150 | 94 | |||||||||
|
Middle East/Asia
|
117 | 152 | 109 | |||||||||
|
Total
|
312 | 558 | 283 | |||||||||
|
Total
operating income by region:
|
||||||||||||
|
North America
|
103 | 539 | 37 | |||||||||
|
Latin America
|
48 | 152 | 97 | |||||||||
|
Europe/Africa/CIS
|
171 | 260 | 201 | |||||||||
|
Middle East/Asia
|
160 | 237 | 188 | |||||||||
|
|
Prior
period segment information was reclassified to reflect the movement of
certain operations from the Completion and Production segment to the
Drilling and Evaluation segment.
|
|
|
-more-
|
|
Revenue
and Operating Income Comparison
|
|
By
Segment and Geographic Region
|
|
(Millions
of dollars)
|
|
(Unaudited)
|
|
Year
Ended December 31
|
||||||||
|
Revenue
by geographic region:
|
2009
|
2008
|
||||||
|
Completion
and Production:
|
||||||||
|
North America
|
$ | 3,589 | $ | 5,327 | ||||
|
Latin America
|
887 | 978 | ||||||
|
Europe/Africa/CIS
|
1,771 | 1,938 | ||||||
|
Middle East/Asia
|
1,172 | 1,367 | ||||||
|
Total
|
7,419 | 9,610 | ||||||
|
Drilling
and Evaluation:
|
||||||||
|
North America
|
2,073 | 3,013 | ||||||
|
Latin America
|
1,294 | 1,447 | ||||||
|
Europe/Africa/CIS
|
2,177 | 2,408 | ||||||
|
Middle East/Asia
|
1,712 | 1,801 | ||||||
|
Total
|
7,256 | 8,669 | ||||||
|
Total
revenue by region:
|
||||||||
|
North America
|
5,662 | 8,340 | ||||||
|
Latin America
|
2,181 | 2,425 | ||||||
|
Europe/Africa/CIS
|
3,948 | 4,346 | ||||||
|
Middle East/Asia
|
2,884 | 3,168 | ||||||
|
Operating
income by geographic region
|
||||||||
|
(excluding
Corporate and other):
|
||||||||
|
Completion
and Production:
|
||||||||
|
North America
|
$ | 272 | $ | 1,426 | ||||
|
Latin America
|
172 | 214 | ||||||
|
Europe/Africa/CIS
|
315 | 360 | ||||||
|
Middle East/Asia
|
257 | 304 | ||||||
|
Total
|
1,016 | 2,304 | ||||||
|
Drilling
and Evaluation:
|
||||||||
|
North America
|
178 | 679 | ||||||
|
Latin America
|
187 | 307 | ||||||
|
Europe/Africa/CIS
|
380 | 497 | ||||||
|
Middle East/Asia
|
438 | 487 | ||||||
|
Total
|
1,183 | 1,970 | ||||||
|
Total
operating income by region:
|
||||||||
|
North America
|
450 | 2,105 | ||||||
|
Latin America
|
359 | 521 | ||||||
|
Europe/Africa/CIS
|
695 | 857 | ||||||
|
Middle East/Asia
|
695 | 791 | ||||||
|
|
Prior
period segment information was reclassified to reflect the movement of
certain operations from the Completion and Production segment to the
Drilling and Evaluation segment.
|
|
|
See
Footnote Table 3 for a list of significant items included in operating
income.
|
|
Excluded
Costs
|
|
By
Segment and Geographic Region
|
|
(Millions
of dollars)
|
|
(Unaudited)
|
|
Three
Months Ended
|
||||||||
|
December
31
|
September
30
|
|||||||
|
Excluded
costs by geographic region:
|
2009(a)
|
2009(b)
|
||||||
|
Completion
and Production:
|
||||||||
|
North America
|
$ | – | $ | 5 | ||||
|
Latin America
|
3 | 3 | ||||||
|
Europe/Africa/CIS
|
– | 3 | ||||||
|
Middle East/Asia
|
– | 2 | ||||||
|
Total
|
3 | 13 | ||||||
|
Drilling
and Evaluation:
|
||||||||
|
North America
|
– | 4 | ||||||
|
Latin America
|
12 | 4 | ||||||
|
Europe/Africa/CIS
|
– | 5 | ||||||
|
Middle East/Asia
|
– | 2 | ||||||
|
Total
|
12 | 15 | ||||||
|
Total
excluded costs by region:
|
||||||||
|
North America
|
– | 9 | ||||||
|
Latin America
|
15 | 7 | ||||||
|
Europe/Africa/CIS
|
– | 8 | ||||||
|
Middle East/Asia
|
– | 4 | ||||||
|
Total
|
15 | 28 | ||||||
|
(a)
|
Bad
debt expense arising from the settlement of a significant Venezuela
customer account receivable.
|
|
(b)
|
Employee
separation costs.
|
|
|
By
Segment and Geographic Region
|
|
|
(Millions
of dollars)
|
|
|
(Unaudited)
|
|
Three
Months Ended
|
||||||||
|
Adjusted
operating income by geographic region:
|
December
31
|
September
30
|
||||||
|
(excluding
Corporate and other): (a) (b)
|
2009
|
2009
|
||||||
|
Completion
and Production:
|
||||||||
|
North America
|
$ | 45 | $ | 14 | ||||
|
Latin America
|
23 | 48 | ||||||
|
Europe/Africa/CIS
|
62 | 110 | ||||||
|
Middle East/Asia
|
43 | 81 | ||||||
|
Total
|
173 | 253 | ||||||
|
Drilling
and Evaluation:
|
||||||||
|
North America
|
58 | 32 | ||||||
|
Latin America
|
40 | 56 | ||||||
|
Europe/Africa/CIS
|
109 | 99 | ||||||
|
Middle East/Asia
|
117 | 111 | ||||||
|
Total
|
324 | 298 | ||||||
|
Total
operating income by region:
|
||||||||
|
North America
|
103 | 46 | ||||||
|
Latin America
|
63 | 104 | ||||||
|
Europe/Africa/CIS
|
171 | 209 | ||||||
|
Middle East/Asia
|
160 | 192 | ||||||
|
(a)
|
Management
believes that operating income adjusted for employee separation costs and
the receivables settlement is useful to investors to assess and understand
segment and region operating performance, especially when comparing
current results with previous 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 operating income without the impact of employee separation costs
and the receivables settlement as an indicator of ongoing segment and
region operating performance, to identify underlying trends in the
business, and to establish segment and region operational
goals. The adjustment removes the effect of these
expenses.
|
|
(b)
|
Adjusted
operating income for each segment and region is calculated
as: “Operating income” plus “Excluded
costs.”
|
|
Items
Included in Operating Income
|
|
(Millions
of dollars except per share data)
|
|
(Unaudited)
|
|
Year Ended
|
Year
Ended
|
|||||||||||||||
|
December
31, 2009
|
December
31, 2008
|
|||||||||||||||
|
Operating
|
After
Tax
|
Operating
|
After
Tax
|
|||||||||||||
|
Income
|
Per
Share
|
Income
|
Per
Share
|
|||||||||||||
|
Completion
and Production:
|
||||||||||||||||
|
North America
|
||||||||||||||||
|
Gain on sale of
investments
|
$ | – | $ | – | $ | 35 | $ | 0.02 | ||||||||
|
Employee separation
costs
|
(19 | ) | (0.02 | ) | – | – | ||||||||||
|
Latin America
|
||||||||||||||||
|
Employee separation
costs
|
(7 | ) | – | – | – | |||||||||||
|
Receivables
settlement
|
(3 | ) | – | |||||||||||||
|
Europe/Africa/CIS
|
||||||||||||||||
|
Employee separation
costs
|
(5 | ) | – | – | – | |||||||||||
|
Middle
East/Asia
|
||||||||||||||||
|
Employee separation
costs
|
(3 | ) | – | – | – | |||||||||||
|
Drilling
and Evaluation:
|
||||||||||||||||
|
North America
|
||||||||||||||||
|
Gain on sale of
investments
|
– | – | 25 | 0.02 | ||||||||||||
|
Employee separation
costs
|
(13 | ) | (0.01 | ) | – | – | ||||||||||
|
Latin America
|
||||||||||||||||
|
Employee separation
costs
|
(8 | ) | (0.01 | ) | – | – | ||||||||||
|
Receivables
settlement
|
(12 | ) | (0.01 | ) | ||||||||||||
|
Europe/Africa/CIS
|
||||||||||||||||
|
Employee separation
costs
|
(8 | ) | (0.01 | ) | – | – | ||||||||||
|
Middle
East/Asia
|
||||||||||||||||
|
Impairment of oil and gas
property
|
– | – | (23 | ) | (0.02 | ) | ||||||||||
|
Employee separation
costs
|
(5 | ) | – | – | – | |||||||||||
|
Corporate
and other:
|
||||||||||||||||
|
Patent
settlements
|
– | – | 5 | (a) | – | |||||||||||
|
Acquisition-related
adjustment
|
– | – | (22 | ) | (0.02 | ) | ||||||||||
|
Employee separation
costs
|
(5 | ) | – | – | – | |||||||||||
|
(a)
|
Patent
settlements in 2008 included a $35 million gain in the fourth quarter of
2008, which was partially offset by a $30 million charge in the second
quarter of 2008.
|
|
Three
Months Ended
|
||||
|
December
31, 2009
|
||||
|
As
reported income from continuing operations
|
$ | 247 | ||
|
Receivables settlement, net of
tax (a)
|
10 | |||
|
Adjusted
income from continuing operations (a)
|
$ | 257 | ||
|
As
reported diluted weighted average common shares
outstanding
|
906 | |||
|
As
reported income from continuing operations per diluted share
(b)
|
$ | 0.27 | ||
|
Adjusted
income from continuing operations per diluted share (b)
|
$ | 0.28 | ||
|
(a)
|
Management
believes that income from continuing operations adjusted for the
receivables settlement is useful to investors to assess and understand
operating performance, especially when comparing current results with
previous periods or forecasting performance for future periods, primarily
because management views the excluded item to be outside of the Company’s
normal operating results. Management analyzes income from continuing
operations without the impact of the receivables settlement as an
indicator of performance, to identify underlying trends in the business,
and to establish operational goals. The adjustment removes the
effect of the expense. Adjusted income from continuing
operations is calculated as: “As reported income from
continuing operations” plus “Receivables settlement, net of
tax.”
|
|
(b)
|
As
reported income from continuing operations per diluted share is calculated
as: “As reported income from continuing operations” 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” divided by “As reported diluted weighted average common shares
outstanding.”
|
|
December
31, 2009
|
||||
|
Total
debt (b)
|
$ | 4,574 | ||
|
Cash and
equivalents
|
(2,082 | ) | ||
|
Investments in marketable
securities
|
(1,312 | ) | ||
|
Net
debt (c)
|
$ | 1,180 | ||
|
As
reported total shareholders’ equity
|
$ | 8,757 | ||
|
Total
debt (b)
|
4,574 | |||
|
Total
capitalization (d)
|
$ | 13,331 | ||
|
Net
debt to total capitalization ratio (a)
|
9% | |||
|
(a)
|
Management
believes that the net debt to total capitalization ratio is an important
financial measure for use in evaluating the Company’s liquidity, which
measures the amount of net debt compared to available
capital. Management believes that because cash and equivalents
and investments in marketable securities can be used to repay
indebtedness, net debt provides a clearer picture of the future demands on
cash to repay debt by netting cash and equivalents and investments in
marketable securities against debt. The net debt to total
capitalization ratio is calculated as: “Net debt” divided by “Total
capitalization.”
|
|
(b)
|
Total
debt includes short-term notes payable, current maturities of long-term
debt, and long-term debt.
|
|
(c)
|
Net
debt is calculated as: “Total debt” less “Cash and equivalents” less
“Investments in marketable
securities.”
|
|
(d)
|
Total
capitalization is calculated as: “As reported total shareholders’ equity”
plus “Total debt.”
|
|
|
FOOTNOTE
TABLE 6
|
|
Year
Ended
|
||||
|
December
31, 2009
|
||||
|
Income
from continuing operations before noncontrolling interest
|
$ | 1,164 | ||
|
Net
financing costs, after tax (b)
|
197 | |||
|
Excluded
costs, after tax (c)
|
61 | |||
|
Earnings
before net financing costs and excluded costs
|
$ | 1,422 | ||
|
Invested
capital – December 31, 2008 (d)
|
$ | 10,369 | ||
|
Invested
capital – December 31, 2009 (d)
|
$ | 13,331 | ||
|
Average
invested capital
|
$ | 11,850 | ||
|
Return
on average invested capital (ROIC) (a)
|
12% | |||
|
(a)
|
Management
believes that return on average invested capital (ROIC) is useful to
investors to assess historical capital productivity, evaluate management’s
performance, and to demonstrate to shareholders that capital has been used
wisely over the long term. ROIC is calculated
as: “Earnings before net financing costs and excluded costs”
divided by “Average invested
capital.”
|
|
(b)
|
“Net
financing costs, after tax” consists of interest expense and interest
income.
|
|
(c)
|
“Excluded
costs, after tax” includes the items in footnote table 3. The
adjustment removes the effect of these expenses because management views
the items to be outside of the Company’s normal operating
results.
|
|
(d)
|
“Invested
capital” includes total shareholders’ equity and total
debt. Total debt consists of short-term notes payable, current
maturities of long-term debt, and long-term
debt.
|
|
|
###
|
|
|
|
|
HALLIBURTON
COMPANY
|
||
|
Date: January
28, 2010
|
By:
|
/s/ Bruce A. Metzinger |
|
Bruce
A. Metzinger
|
||
|
Assistant
Secretary
|