News Feed Item

Weatherford Updates Fourth Quarter 2013 Guidance

Confirms Significant Reduction in Net Debt; Announces Cost Reduction Measures

GENEVA, Jan. 30, 2014 /PRNewswire/ -- Weatherford International Ltd. (NYSE / Euronext Paris / SIX: WFT) today updates its projected fourth quarter 2013 earnings per share (non-GAAP) financial results. Earnings per share for the fourth quarter 2013 are estimated to be in the range of $0.05 - $0.08. The shortfall can be primarily attributed to the following factors:

  • Capital discipline driven activity reductions in Latin America;
  • Operational disruptions in the Middle East;
  • Severe weather conditions, adversely impacting activity in North America and the North Sea; and
  • Incremental tax planning items, which increased the fourth quarter effective tax rate to approximately 50%, adding $0.03 to the fourth quarter tax expense. These items are expected to favorably impact the tax rate for the Company going forward.

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

Despite the shortfalls described above, net debt was reduced by nearly $700 million during the fourth quarter, reflecting strong operating cash flow and the partial monetization of the previously announced divestiture of the Borets joint venture.

The Company established a culture of capital discipline in 2013, successfully resolved the U.S. government investigations, and expects to announce the remediation of the material weakness in income tax accounting when we file our Form 10-K for 2013. The Company identified the non-core businesses which have now been slated for divestiture. These are essential steps in our transformational plan.

2014 Outlook

In 2014, we are focused on achieving a step change in profitability by:

  • Focusing the organization on growing our core businesses;
  • Making our cost base more efficient; and
  • Divesting our non-core businesses and reducing our net debt.

The operational update going into 2014 is positive. Some highlights are:

  • During the fourth quarter, the Company secured an incremental $1.5 billion in multi-year contracts for well construction across all regions;
  • Artificial Lift continues to gain market share, primarily in North America;
  • Currently, more than 80% of our U.S. pressure pumping horsepower is term contracted. During the fourth quarter, the increased focus on cost and operating efficiencies in pressure pumping are expected to drive profitability improvements in 2014; and
  • There is continued improvement on securing dayrate contracts in the Eastern Hemisphere for our rigs. Currently, more than 90% of the Eastern Hemisphere rigs are contracted.

As an important step in making our cost base more efficient, the Company has decided to reduce its workforce by 7,000 employees, primarily from its fixed support cost base. This reduction will not affect the non-core businesses of Weatherford that have been earmarked for divestiture in 2014; instead, it is designed to lighten the support structure of Weatherford to compensate for the divestiture program. The workforce reduction is expected to be completed during the first half of 2014, resulting in annualized savings of $500 million, with roughly half of this amount impacting 2014 earnings. These actions will not affect or compromise in any way Weatherford's accounting and tax processes.

Concurrently, additional strategic reviews are ongoing with a view to eliminating operations that do not have critical mass and are currently unprofitable and a drain on Weatherford's cash flow.

The non-core business divestiture program is on track as previously announced.

Based on its current activity profile, and inclusive of the benefits arising from the cost reduction actions outlined above, Weatherford expects 2014 earnings per share (non-GAAP) to range between $1.10 and $1.20 and our effective tax rate is forecasted to be 25% to 35%.

Having placed all distractions behind us, management is single-mindedly focused on operating performance. Additional details on the Company's 2014 outlook, operations, cash flow and cost reduction actions will be provided during our fourth quarter earnings conference call on February 26, 2014.

About Weatherford

Weatherford is one of the largest multinational oilfield service companies. Weatherford's product and service portfolio spans the lifecycle of the well, and includes formation evaluation, well construction, completion and production. The Company provides innovative solutions, technology and services to the oil and gas industry, and operates in over 100 countries currently employing more than 65,000 people worldwide.


Krishna Shivram


Executive Vice President and Chief Financial Officer

Karen David-Green


Vice President – Investor Relations

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, the Company's non-GAAP earnings per share and the size, timing and benefits of the reduction in workforce, and are also generally identified by the words "believe," "project," "expect," "anticipate," "estimate," "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. 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. Readers are also cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results due to the Company's ability to implement workforce reductions in various geographies; possible changes in the size and components of the expected costs and charges associated with the reduction plan; and risks associated with the Company's ability to achieve the benefits of the planned workforce reduction. Additionally, the Company has not completed our review of our financial information for the fourth quarter of 2013, and accordingly, expected results are subject to change. Forward-looking statements also are affected by the risk factors described in the company's Annual Report on Form 10-K for the year ended December 31, 2012, and those set forth from time-to-time in other filings with the Securities and Exchange Commission ("SEC"). 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.

SOURCE Weatherford International Ltd.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
So you think you are a DevOps warrior, huh? Put your money (not really, it’s free) where your metrics are and prove it by taking The Ultimate DevOps Geek Quiz Challenge, sponsored by DevOps Summit. Battle through the set of tough questions created by industry thought leaders to earn your bragging rights and win some cool prizes.
Effectively SMBs and government programs must address compounded regulatory compliance requirements. The most recent are Controlled Unclassified Information and the EU’s GDPR have Board Level implications. Managing sensitive data protection will likely result in acquisition criteria, demonstration requests and new requirements. Developers, as part of the pre-planning process and the associated supply chain, could benefit from updating their code libraries and design by incorporating changes.
Successful digital transformation requires new organizational competencies and capabilities. Research tells us that the biggest impediment to successful transformation is human; consequently, the biggest enabler is a properly skilled and empowered workforce. In the digital age, new individual and collective competencies are required. In his session at 19th Cloud Expo, Bob Newhouse, CEO and founder of Agilitiv, will draw together recent research and lessons learned from emerging and established ...
The best way to leverage your Cloud Expo presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering Cloud Expo and @ThingsExpo will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at Cloud Expo. Product announcements during our show provide your company with the most reach through our targeted audiences.
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
Traditional on-premises data centers have long been the domain of modern data platforms like Apache Hadoop, meaning companies who build their business on public cloud were challenged to run Big Data processing and analytics at scale. But recent advancements in Hadoop performance, security, and most importantly cloud-native integrations, are giving organizations the ability to truly gain value from all their data. In his session at 19th Cloud Expo, David Tishgart, Director of Product Marketing ...
November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Penta Security is a leading vendor for data security solutions, including its encryption solution, D’Amo. By using FPE technology, D’Amo allows for the implementation of encryption technology to sensitive data fields without modification to schema in the database environment. With businesses having their data become increasingly more complicated in their mission-critical applications (such as ERP, CRM, HRM), continued ...
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor...
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Arch...
In his session at @DevOpsSummit at 19th Cloud Expo, Robert Doyle, lead architect at eCube Systems, will examine the issues and need for an agile infrastructure and show the advantages of capturing developer knowledge in an exportable file for migration into production. He will introduce the use of NXTmonitor, a next-generation DevOps tool that captures application environments, dependencies and start/stop procedures in a portable configuration file with an easy-to-use GUI. In addition to captu...
SYS-CON Events announced today that Enzu will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to focus on the core of their online busine...
Why do your mobile transformations need to happen today? Mobile is the strategy that enterprise transformation centers on to drive customer engagement. In his general session at @ThingsExpo, Roger Woods, Director, Mobile Product & Strategy – Adobe Marketing Cloud, covered key IoT and mobile trends that are forcing mobile transformation, key components of a solid mobile strategy and explored how brands are effectively driving mobile change throughout the enterprise.
SYS-CON Events announced today that Cloudbric, a leading website security provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Cloudbric is an elite full service website protection solution specifically designed for IT novices, entrepreneurs, and small and medium businesses. First launched in 2015, Cloudbric is based on the enterprise level Web Application Firewall by Penta Security Sys...
@DevOpsSummit has been named the ‘Top DevOps Influencer' by iTrend. iTrend processes millions of conversations, tweets, interactions, news articles, press releases, blog posts - and extract meaning form them and analyzes mobile and desktop software platforms used to communicate, various metadata (such as geo location), and automation tools. In overall placement, @DevOpsSummit ranked as the number one ‘DevOps Influencer' followed by @CloudExpo at third, and @MicroservicesE at 24th.