|By PR Newswire||
|January 30, 2014 07:22 AM EST||
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.
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.
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.
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.
Executive Vice President and Chief Financial Officer
Vice President – Investor Relations
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.
In a recent research, analyst firm IDC found that the average cost of a critical application failure is $500,000 to $1 million per hour and the average total cost of unplanned application downtime is $1.25 billion to $2.5 billion per year for Fortune 1000 companies. In addition to the findings on the cost of the downtime, the research also highlighted best practices for development, testing, application support, infrastructure, and operations teams.
Jul. 29, 2015 05:30 PM EDT
"We specialize in testing. DevOps is all about continuous delivery and accelerating the delivery pipeline and there is no continuous delivery without testing," noted Marc Hornbeek, Sr. Solutions Architect at Spirent Communications, in this SYS-CON.tv interview at @DevOpsSummit, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 05:15 PM EDT Reads: 360
How do you securely enable access to your applications in AWS without exposing any attack surfaces? The answer is usually very complicated because application environments morph over time in response to growing requirements from your employee base, your partners and your customers. In his session at @DevOpsSummit, Haseeb Budhani, CEO and Co-founder of Soha, shared five common approaches that DevOps teams follow to secure access to applications deployed in AWS, Azure, etc., and the friction an...
Jul. 29, 2015 04:30 PM EDT Reads: 497
"Alert Logic is a managed security service provider that basically deploys technologies, but we support those technologies with the people and process behind it," stated Stephen Coty, Chief Security Evangelist at Alert Logic, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 04:15 PM EDT Reads: 322
Digital Transformation is the ultimate goal of cloud computing and related initiatives. The phrase is certainly not a precise one, and as subject to hand-waving and distortion as any high-falutin' terminology in the world of information technology. Yet it is an excellent choice of words to describe what enterprise IT—and by extension, organizations in general—should be working to achieve. Digital Transformation means: handling all the data types being found and created in the organizat...
Jul. 29, 2015 04:00 PM EDT Reads: 1,066
The essence of cloud computing is that all consumable IT resources are delivered as services. In his session at 15th Cloud Expo, Yung Chou, Technology Evangelist at Microsoft, demonstrated the concepts and implementations of two important cloud computing deliveries: Infrastructure as a Service (IaaS) and Platform as a Service (PaaS). He discussed from business and technical viewpoints what exactly they are, why we care, how they are different and in what ways, and the strategies for IT to tran...
Jul. 29, 2015 03:15 PM EDT Reads: 396
The Internet of Everything (IoE) brings together people, process, data and things to make networked connections more relevant and valuable than ever before – transforming information into knowledge and knowledge into wisdom. IoE creates new capabilities, richer experiences, and unprecedented opportunities to improve business and government operations, decision making and mission support capabilities.
Jul. 29, 2015 03:15 PM EDT Reads: 237
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin,...
Jul. 29, 2015 03:00 PM EDT Reads: 466
The Internet of Things is not only adding billions of sensors and billions of terabytes to the Internet. It is also forcing a fundamental change in the way we envision Information Technology. For the first time, more data is being created by devices at the edge of the Internet rather than from centralized systems. What does this mean for today's IT professional? In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists addressed this very serious issue of pro...
Jul. 29, 2015 03:00 PM EDT Reads: 1,256
With SaaS use rampant across organizations, how can IT departments track company data and maintain security? More and more departments are commissioning their own solutions and bypassing IT. A cloud environment is amorphous and powerful, allowing you to set up solutions for all of your user needs: document sharing and collaboration, mobile access, e-mail, even industry-specific applications. In his session at 16th Cloud Expo, Shawn Mills, President and a founder of Green House Data, discussed h...
Jul. 29, 2015 02:30 PM EDT Reads: 322
Container technology is sending shock waves through the world of cloud computing. Heralded as the 'next big thing,' containers provide software owners a consistent way to package their software and dependencies while infrastructure operators benefit from a standard way to deploy and run them. Containers present new challenges for tracking usage due to their dynamic nature. They can also be deployed to bare metal, virtual machines and various cloud platforms. How do software owners track the usag...
Jul. 29, 2015 02:30 PM EDT
Discussions about cloud computing are evolving into discussions about enterprise IT in general. As enterprises increasingly migrate toward their own unique clouds, new issues such as the use of containers and microservices emerge to keep things interesting. In this Power Panel at 16th Cloud Expo, moderated by Conference Chair Roger Strukhoff, panelists addressed the state of cloud computing today, and what enterprise IT professionals need to know about how the latest topics and trends affect t...
Jul. 29, 2015 02:00 PM EDT Reads: 1,169
"Our biggest growth area has been the security services, the managed services - the things that differentiate us in the market that there is no client that's too small and there's no client that's too big," explained Paul Mazzucco, Chief Security Officer at TierPoint, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 02:00 PM EDT Reads: 372
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Jul. 29, 2015 01:45 PM EDT Reads: 422
Containers are changing the security landscape for software development and deployment. As with any security solutions, security approaches that work for developers, operations personnel and security professionals is a requirement. In his session at DevOps Summit, Kevin Gilpin, CTO and Co-Founder of Conjur, will discuss various security considerations for container-based infrastructure and related DevOps workflows.
Jul. 29, 2015 01:00 PM EDT Reads: 1,059