- Full-year revenue outlook increased to mid-teens growth
year-over-year
- Second quarter revenues of $1,064
million increased 13% sequentially, led by strong
international growth of 14%
- Operating income was $104
million, compared to $18
million in the first quarter of 2022 and adjusted
EBITDA[1] was $186 million
or a 17.5% adjusted EBITDA margin, a sequential increase of 23%, a
140 basis points adjusted EBITDA margin rate expansion
- Net cash provided by operating activities was $60 million and free cash flow[1] was
$59 million, driven by improved
collections efficiency
- Issued a notice of election to redeem $50 million of our 11% senior unsecured
notes
- Joined the broad-market Russell 3000® Index,
effective June 27, 2022
HOUSTON, July 27,
2022 /PRNewswire/ -- Weatherford International plc
(NASDAQ: WFRD) ("Weatherford" or
the "Company") announced today its results for the second quarter
of 2022.
Revenues for the second quarter of 2022 were $1,064 million, an increase of 13% sequentially
and 18% year-over-year. Operating income was $104 million in the second quarter of 2022,
compared to $18 million in the first
quarter of 2022 and $25 million in
the second quarter of 2021. The Company's second quarter of 2022
net income was $6 million, compared
to a net loss of $80 million in the
first quarter of 2022 and a net loss of $78
million in the second quarter of 2021. Tax expense in the
second quarter of 2022 included a $27
million recognition of a benefit from certain previously
uncertain tax positions.
Second quarter 2022 cash flows provided by operations were
$60 million, compared to cash flows
used in operations of $64 million in
the first quarter of 2022 and cash flows provided by operations of
$46 million in the second quarter of
2021. Capital expenditures were $24
million in the second quarter of 2022, compared to
$20 million in the first quarter of
2022 and $9 million in the second
quarter of 2021.
- Adjusted EBITDA[1] was $186 million, an increase of 23% sequentially and
37% year-over-year
- Free cash flow[1] was $59 million, an increase of $123 million sequentially and $11 million year-over-year
- Other (credits) charges was a net credit of $14 million, primarily related to the gain on
sale of assets related to our fulfillment initiatives and
collections of previously impaired receivables
Girish Saligram, President and
Chief Executive Officer, commented, "We delivered noteworthy
results well ahead of our guidance across all metrics. We showed
strong sequential growth in revenues, adjusted EBITDA, and free
cash flow, as our market leading offerings continued to gain
commercial traction with solid fall-through on margins. We continue
to make progress on our commercial and operational paradigm changes
and our second quarter adjusted EBITDA margins of 17.5% and free
cash flow of $59 million, demonstrate
those improvements taking hold. Our results reaffirm that our
strategy to expand margins sustainably over the cycle, while
generating positive free cash flow, is delivering the intended
results.
The macro-environment for the sector continues to be supported
by strong fundamentals, and we are capitalizing on the
opportunities enabled by our broad services portfolio, leading edge
specialty services, transformation of our operating paradigm, and
strong customer relationships. Despite substantial supply chain and
geopolitical headwinds, based on the strength of our second-quarter
performance and the confidence in our strategy, we now expect
full-year 2022 revenue to grow by mid-teens year-over-year,
exceeding our previous expectations."
Notes:
|
[1] EBITDA
represents income before interest expense, net, income taxes,
depreciation and amortization expense. Adjusted EBITDA excludes,
among other items, restructuring charges, share-based compensation
expense, as well as other charges and credits. Free cash flow is
calculated as cash flows provided by (used in) operating
activities, less capital expenditures plus proceeds from the
disposition of assets. EBITDA, adjusted EBITDA, and free cash flow
are non-GAAP measures. Each measure is defined and reconciled to
the most directly comparable GAAP measure in the tables
below.
|
Commercial and Operational
Highlights
- PTT Exploration and Production Thailand awarded Weatherford a five-year contract to deliver
high-temperature directional drilling, measurement-while-drilling,
and logging-while-drilling services. Our history of service
excellence in the region and market-leading technology in
high-temperature environments made Weatherford a preferred choice for this
contract award.
- ADNOC Offshore awarded Weatherford a five-year well services
agreement for the provision of through tubing equipment and
services. Our offering combines expertise with field-proven
technology to help customers consume fewer resources, reduce carbon
footprint, and maximize the economic life of existing
infrastructure.
- Hess Corporation and Weatherford entered into a three-year
commercial agreement, with Weatherford serving as the primary supplier of
artificial lift equipment and services, including automation, in
Hess's Bakken operations, in North
America. We received this award because of the field-proven
application of our Rotaflex® long-stroke pumping technology
combined with Weatherford WellPilot® Regen variable
speed drives (VSD) and the ability to provide value-added services
and engineering.
- Chevron in Thailand awarded
Weatherford a six-year commercial
contract to deliver tubular running services (TRS). We credit this
award to our 60 years of experience in TRS, our track record of
incident-free operations in the region, and our high level of
operational efficiency.
- Shell awarded Weatherford a
three-year contract to continue providing cementing products and
casing accessories in the Gulf of
Mexico. We are a leading provider of deepwater cementing
systems, with a well-integrity portfolio that optimizes cement
placement, manages surges, and sets the stage for life-of-well
integrity.
- Santos Limited awarded Weatherford a three-year commercial contract
to provide sucker rods for their operations in Australia. Our sucker-rod portfolio guarantees
a match between customer needs, budget, and production strategy to
make the most of existing assets and unique well environments.
- Our real-time remote engineering support, coupled with Managed
Pressure Drilling (MPD) ability to execute against an exacting
pressure management plan throughout the well construction phase,
helped to drill the longest well in Canada at approx. 30,000 ft for a major
operator, faster and with fewer trips.
Liquidity
We closed the second quarter of 2022 with total cash of
approximately $1.1 billion as of
June 30, 2022, up $34 million
sequentially. Free cash flow of $59 million improved
$123 million versus the first quarter
of 2022. The sequential improvement was driven by improved
collections efficiency. To further improve our debt profile and
reduce interest payments, on July 11,
2022, we issued a notice to redeem $50 million of our
11% senior unsecured notes on August 10,
2022.
Results by Reportable
Segment
Drilling & Evaluation ("DRE")
|
|
Three Months
Ended
|
|
Variance
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Seq.
|
|
YoY
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
DRE Revenues
|
|
$
317
|
|
$
292
|
|
$
265
|
|
9 %
|
|
20 %
|
DRE Segment Adjusted
EBITDA
|
|
$
69
|
|
$
59
|
|
$
46
|
|
17 %
|
|
50 %
|
%
Margin
|
|
21.8 %
|
|
20.2 %
|
|
17.4 %
|
|
160 bps
|
|
440 bps
|
Second quarter 2022 DRE revenues of $317
million increased by $25
million, or 9% sequentially, due to higher demand for all
DRE product lines, driven by managed pressure drilling and drilling
services, primarily in Latin
America and the Middle
East/North
Africa/Asia regions. Second
quarter 2022 DRE segment adjusted EBITDA of $69 million increased by $10 million, or 17% sequentially, largely due to
higher fall-through for drilling services primarily in Latin America.
Well Construction and Completions ("WCC")
|
|
Three Months
Ended
|
|
Variance
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Seq.
|
|
YoY
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
WCC Revenues
|
|
$
383
|
|
$
344
|
|
$
337
|
|
11 %
|
|
14 %
|
WCC Segment Adjusted
EBITDA
|
|
$
67
|
|
$
67
|
|
$
55
|
|
— %
|
|
22 %
|
%
Margin
|
|
17.5 %
|
|
19.5 %
|
|
16.3 %
|
|
(200) bps
|
|
120 bps
|
Second quarter 2022 WCC revenues of $383
million increased by $39
million, or 11% sequentially, due to higher demand for all
WCC product lines, driven by tubular running services and
completions primarily in the Middle East North Africa/Asia region.
Second quarter 2022 WCC segment adjusted EBITDA of $67 million was flat sequentially with volume
improvement primarily in Latin
America and the Middle
East/North
Africa/Asia region offset
by a change in revenue mix, which contributed to the margin
decline.
Production and Intervention ("PRI")
|
|
Three Months
Ended
|
|
Variance
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Seq.
|
|
YoY
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
PRI Revenues
|
|
$
345
|
|
$
286
|
|
$
278
|
|
21 %
|
|
24 %
|
PRI Segment Adjusted
EBITDA
|
|
$
68
|
|
$
39
|
|
$
46
|
|
74 %
|
|
48 %
|
%
Margin
|
|
19.7 %
|
|
13.6 %
|
|
16.5 %
|
|
610 bps
|
|
320 bps
|
Second quarter 2022 PRI revenues of $345
million increased by $59
million, or 21% sequentially, due to higher demand for all
PRI product lines, driven by intervention services and drilling
tools and artificial lift, primarily in North America. Second quarter 2022 PRI segment
adjusted EBITDA of $68 million,
increased $29 million, or 74%
sequentially, mainly from increased revenues and a higher
fall-through for intervention services and drilling tools and
artificial lift, primarily in North
America and the Middle
East/North
Africa/Asia region.
About Weatherford
Weatherford delivers innovative
energy services that integrate proven technologies with advanced
digitalization to create sustainable offerings for maximized value
and return on investment. Our world-class experts partner with
customers to optimize their resources and realize the full
potential of their assets. Operators choose us for strategic
solutions that add efficiency, flexibility, and responsibility to
any energy operation. The Company operates in approximately 75
countries and 17,500 team members representing more than 110
nationalities and 350 operating locations. Visit weatherford.com
for more information and connect with us on social media.
Conference Call Details
Weatherford will host a
conference call on Thursday, July 28, 2022, to discuss the
results for the second quarter ended June
30, 2022. The conference call will begin at 9:00 a.m. Eastern Time (8:00 a.m. Central Time).
Listeners are encouraged to download the accompanying
presentation slides which will be available in the investor
relations section of the Company's website.
Listeners can participate in the conference call via a live
webcast at
https://www.weatherford.com/en/investor-relations/investor-news-and-events/events/,
or by dialing +1 877-328-5344 (within the U.S.) or +1 412-902-6762
(outside of the U.S.) and asking for the Weatherford conference call. Listeners should
log in or dial in approximately 10 minutes prior to the start of
the call.
A telephonic replay of the conference call will be available
until August 10, 2022 at 5:00 p.m. Eastern Time. To access the replay,
please dial +1 877-344-7529 (within the U.S.) or +1 412-317-0088
(outside of the U.S.) and reference conference number 7442205. A
replay and transcript of the earnings call will also be available
in the investor relations section of the Company's website.
###
Contacts
For Investors:
Mohammed
Topiwala
Director, Investor Relations and M&A
+1 713-836-7777
investor.relations@weatherford.com
For Media:
Kelley
Hughes
Director, Global Communications
+1 713-836-4193
kelley.hughes@weatherford.com
Forward-Looking
Statements
This news release contains projections and forward-looking
statements concerning, among other things, the Company's quarterly
and full-year revenues, operating income and losses, segment
adjusted EBITDA, adjusted EBITDA, free cash flow, forecasts or
expectations regarding business outlook, prospects for its
operations, capital expenditures, expectations regarding future
financial results, and are also generally identified by the words
"believe," "project," "expect," "anticipate," "estimate,"
"outlook," "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. Readers are
cautioned that forward-looking statements are only predictions and
may differ materially from actual future events or results,
including: the price and price volatility of oil and natural gas;
various effects from the Russia Ukraine conflict including, but not
limited to, extended business interruptions, sanctions imposed by
various countries, associated operational and logistical
challenges, and impacts to the overall global energy supply;
cybersecurity issues, as we may experience a higher rate of
cybersecurity attacks, intrusions or incidents in the current
environment of remote connectivity; demand for oil and gas and
fluctuations in commodity prices; general global economic
repercussions related to U.S. and global inflationary pressures;
the macroeconomic outlook for the oil and gas industry; operational
challenges relating the COVID-19 pandemic and efforts to mitigate
the spread of the COVID-19 virus and COVID-19 variants, including
logistical challenges, protecting the health and well-being of our
employees, remote work arrangements, performance of contracts and
supply chain disruptions; our ability to generate cash flow from
operations to fund our operations; and the realization of
additional cost savings and operational efficiencies.
These risks and uncertainties are more fully described in
Weatherford's reports and
registration statements filed with the SEC, including the risk
factors described in the Company's Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. Accordingly, you should not place
undue reliance on any of the Company's forward-looking statements.
Any forward-looking statements speaks only as of the date on which
such statement is made, and the Company undertakes no obligation to
correct or update any forward-looking statement, whether as a
result of new information, future events or otherwise, except as
required by applicable law, and we caution you not to rely on them
unduly.
Weatherford
International plc
|
Selected Statements
of Operations (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
($ in Millions,
Except Per Share Amounts)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
Drilling and
Evaluation
|
|
$
317
|
|
$
292
|
|
$
265
|
|
$
609
|
|
$
501
|
Well Construction and
Completions
|
|
383
|
|
344
|
|
337
|
|
727
|
|
660
|
Production and
Intervention
|
|
345
|
|
286
|
|
278
|
|
631
|
|
537
|
Segment
Revenues
|
|
1,045
|
|
922
|
|
880
|
|
1,967
|
|
1,698
|
All Other
|
|
19
|
|
16
|
|
23
|
|
35
|
|
37
|
Total
Revenues
|
|
1,064
|
|
938
|
|
903
|
|
2,002
|
|
1,735
|
|
|
|
|
|
|
|
|
|
|
|
Segment Adjusted
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
Drilling and
Evaluation
|
|
$
69
|
|
$
59
|
|
$
46
|
|
$
128
|
|
$
75
|
Well Construction and
Completions
|
|
67
|
|
67
|
|
55
|
|
134
|
|
105
|
Production and
Intervention
|
|
68
|
|
39
|
|
46
|
|
107
|
|
87
|
Segment Adjusted
EBITDA [1]
|
|
204
|
|
165
|
|
147
|
|
369
|
|
267
|
Corporate and Other
[2]
|
|
(18)
|
|
(14)
|
|
(11)
|
|
(32)
|
|
(29)
|
Total Adjusted
EBITDA
|
|
186
|
|
151
|
|
136
|
|
337
|
|
238
|
Depreciation and
Amortization
|
|
(90)
|
|
(87)
|
|
(114)
|
|
(177)
|
|
(225)
|
Share-based
Compensation Expense
|
|
(6)
|
|
(7)
|
|
(5)
|
|
(13)
|
|
(9)
|
Other Adjustments
[3]
|
|
14
|
|
(39)
|
|
8
|
|
(25)
|
|
8
|
Total Operating
Income
|
|
104
|
|
18
|
|
25
|
|
122
|
|
12
|
Other Income
(Expense):
|
|
|
|
|
|
|
|
|
|
|
Interest Expense,
Net
|
|
(48)
|
|
(48)
|
|
(72)
|
|
(96)
|
|
(142)
|
Other Expense,
Net
|
|
(32)
|
|
(16)
|
|
(11)
|
|
(48)
|
|
(15)
|
Income (Loss) Before
Income Taxes
|
|
24
|
|
(46)
|
|
(58)
|
|
(22)
|
|
(145)
|
Income Tax
Provision
|
|
(12)
|
|
(28)
|
|
(15)
|
|
(40)
|
|
(38)
|
Net Income
(Loss)
|
|
12
|
|
(74)
|
|
(73)
|
|
(62)
|
|
(183)
|
Net Income Attributable
to Noncontrolling Interests
|
|
6
|
|
6
|
|
5
|
|
12
|
|
11
|
Net Income (Loss)
Attributable to Weatherford
|
|
$
6
|
|
$
(80)
|
|
$
(78)
|
|
$
(74)
|
|
$
(194)
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted
Income (Loss) Per Share
|
|
$
0.08
|
|
$
(1.14)
|
|
$
(1.11)
|
|
$
(1.04)
|
|
$
(2.77)
|
Basic Weighted Average
Shares Outstanding
|
|
71
|
|
70
|
|
70
|
|
71
|
|
70
|
Diluted Weighted
Average Shares Outstanding
|
|
73
|
|
70
|
|
70
|
|
71
|
|
70
|
[1]
|
Segment adjusted EBITDA
is our primary measure of segment profitability and is based on
segment earnings before interest, taxes, depreciation,
amortization, share-based compensation expense and other
adjustments. Research and development expenses are included in
segment adjusted EBITDA.
|
[2]
|
Corporate and other
includes business activities related to all other segments (profit
and loss), corporate and other expenses (overhead support and
centrally managed or shared facilities costs) that do not
individually meet the criteria for segment reporting.
|
[3]
|
Other adjustments in
the six months ended June 30, 2022 primarily include a net credit
from the gain on asset sales related to our fulfillment initiatives
and collections of previously impaired receivables in the three
months ended June 30, 2022 offset by net charges in the three
months ended March 31, 2022 to include a $20 million restructuring
charge and a $17 million charge related to Ukraine.
|
Weatherford
International plc
|
Revenues by
Geographic Areas (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Variance
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
Seq.
|
|
YoY
|
Revenues by
Geographic Areas:
|
|
|
|
|
|
|
|
|
|
|
Middle East/North
Africa/Asia
|
|
$
350
|
|
$
310
|
|
$
289
|
|
13 %
|
|
21 %
|
North
America
|
|
268
|
|
238
|
|
220
|
|
13 %
|
|
22 %
|
Latin
America
|
|
265
|
|
227
|
|
205
|
|
17 %
|
|
29 %
|
Europe/Sub-Sahara
Africa/Russia
|
|
181
|
|
163
|
|
189
|
|
11 %
|
|
(4) %
|
Total
Revenues
|
|
$
1,064
|
|
$
938
|
|
$
903
|
|
13 %
|
|
18 %
|
Weatherford
International plc
|
Selected Balance
Sheet Data (Unaudited)
|
|
|
|
|
($ in
Millions)
|
June 30,
2022
|
|
December 31,
2021
|
Assets:
|
|
|
|
Cash and Cash
Equivalents
|
$
879
|
|
$
951
|
Restricted
Cash
|
211
|
|
162
|
Accounts Receivable,
Net
|
930
|
|
825
|
Inventories,
Net
|
716
|
|
670
|
|
|
|
|
Property, Plant and
Equipment, Net
|
939
|
|
996
|
Intangibles,
Net
|
579
|
|
657
|
|
|
|
|
Liabilities:
|
|
|
|
Accounts
Payable
|
448
|
|
380
|
Accrued Salaries and
Benefits
|
291
|
|
343
|
Short-term Borrowings
and Current Portion of Long-term Debt
|
64
|
|
12
|
Long-term
Debt
|
2,366
|
|
2,416
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
Total Shareholders'
Equity
|
491
|
|
496
|
|
|
|
|
Components of Net
Debt [1]:
|
|
|
|
Short-term Borrowings
and Current Portion of Long-term Debt
|
64
|
|
12
|
Long-term
Debt
|
2,366
|
|
2,416
|
Less: Cash and Cash
Equivalents
|
879
|
|
951
|
Less: Restricted
Cash
|
211
|
|
162
|
Net Debt
[1]
|
$
1,340
|
|
$
1,315
|
[1]
|
Net debt is a non-GAAP
measure calculated as total short and long-term debt less cash and
cash equivalents and restricted cash.
|
Weatherford
International plc
|
Selected Cash Flows
Information (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
Cash Flows From
Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
|
$
12
|
|
$
(74)
|
|
$
(73)
|
|
$
(62)
|
|
$
(183)
|
Adjustments to
Reconcile Net Loss to Net Cash Provided (Used In)
By Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
Amortization
|
|
90
|
|
87
|
|
114
|
|
177
|
|
225
|
Asset Write-downs and
Other (Credits) Charges
|
|
(6)
|
|
12
|
|
—
|
|
6
|
|
—
|
Inventory
Charges
|
|
9
|
|
15
|
|
22
|
|
24
|
|
39
|
Gain on Disposition of
Assets
|
|
(9)
|
|
(5)
|
|
(8)
|
|
(14)
|
|
(13)
|
Deferred Income Tax
Provision
|
|
3
|
|
3
|
|
4
|
|
6
|
|
6
|
Share-Based
Compensation
|
|
6
|
|
7
|
|
5
|
|
13
|
|
9
|
Working Capital
[1]
|
|
(20)
|
|
(75)
|
|
12
|
|
(95)
|
|
72
|
Other Operating
Activities [2]
|
|
(25)
|
|
(34)
|
|
(30)
|
|
(59)
|
|
(35)
|
Net Cash Provided By
(Used In) Operating Activities
|
|
60
|
|
(64)
|
|
46
|
|
(4)
|
|
120
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows From
Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
Capital Expenditures
for Property, Plant and Equipment
|
|
(24)
|
|
(20)
|
|
(9)
|
|
(44)
|
|
(24)
|
Proceeds from
Disposition of Assets
|
|
23
|
|
20
|
|
11
|
|
43
|
|
22
|
Proceeds (Payments)
for Other Investing Activities
|
|
(1)
|
|
9
|
|
(1)
|
|
8
|
|
—
|
Net Cash Provided By
(Used In) Investing Activities
|
|
(2)
|
|
9
|
|
1
|
|
7
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows From
Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
Repayments of
Long-term Debt
|
|
(3)
|
|
(4)
|
|
(2)
|
|
(7)
|
|
(5)
|
Other Financing
Activities
|
|
(17)
|
|
(1)
|
|
(4)
|
|
(18)
|
|
(10)
|
Net Cash Used In
Financing Activities
|
|
$
(20)
|
|
$
(5)
|
|
$
(6)
|
|
$
(25)
|
|
$
(15)
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash
Flow[3]:
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided By
(Used In) Operating Activities
|
|
$
60
|
|
$
(64)
|
|
$
46
|
|
$
(4)
|
|
$
120
|
Capital Expenditures
for Property, Plant and Equipment
|
|
(24)
|
|
(20)
|
|
(9)
|
|
(44)
|
|
(24)
|
Proceeds from
Disposition of Assets
|
|
23
|
|
20
|
|
11
|
|
43
|
|
22
|
Free Cash Flow
[3]
|
|
$
59
|
|
$
(64)
|
|
$
48
|
|
$
(5)
|
|
$
118
|
|
|
|
|
|
|
|
|
|
|
|
[1]
|
Working capital is
defined as the cash changes in accounts receivable plus inventory
less accounts payable.
|
[2]
|
Other operating
activities is primarily accruals, net of cash payments for
operational expenses, interest, taxes, employee costs and
leases.
|
[3]
|
Free cash flow is a
non-GAAP measure calculated as cash flows provided by operating
activities, less capital expenditures for property, plant and
equipment plus proceeds from the disposition of assets. Management
believes free cash flow is useful to understand liquidity and
should be considered in addition to but not substitute cash flows
provided by operating activities.
|
We report our financial results in accordance with U.S.
generally accepted accounting principles (GAAP). However,
Weatherford's management believes
that certain non-GAAP financial measures (as defined under the
SEC's Regulation G and Item 10(e) of Regulation S-K) may provide
users of this financial information additional meaningful
comparisons between current results and results of prior periods
and comparisons with peer companies. The non-GAAP amounts shown in
the following tables should not be considered as substitutes for
operating income, provision for income taxes, net income or other
data prepared and reported in accordance with GAAP, but should be
viewed in addition to the Company's reported results prepared in
accordance with GAAP.
Weatherford
International plc
|
Reconciliation of
GAAP to Non-GAAP Financial Measures (Unaudited)
|
($ in Millions,
Except Per Share Amounts)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
Operating
Income:
|
|
|
|
|
|
|
|
|
|
GAAP Operating
Income
|
$
104
|
|
$
18
|
|
$
25
|
|
$
122
|
|
$
12
|
Other (Credits)
Charges
|
(14)
|
|
19
|
|
(8)
|
|
5
|
|
(8)
|
Restructuring
Charges
|
—
|
|
20
|
|
—
|
|
20
|
|
—
|
Operating
Non-GAAP Adjustments
|
(14)
|
|
39
|
|
(8)
|
|
25
|
|
(8)
|
Non-GAAP Adjusted
Operating Income
|
$
90
|
|
$
57
|
|
$
17
|
|
$
147
|
|
$
4
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) Before
Income Taxes:
|
|
|
|
|
|
|
|
|
|
GAAP Income (Loss)
Before Income Taxes
|
$
24
|
|
$
(46)
|
|
$
(58)
|
|
$
(22)
|
|
$
(145)
|
Operating Non-GAAP
Adjustments
|
(14)
|
|
39
|
|
(8)
|
|
25
|
|
(8)
|
Non-GAAP Adjustments
Before Taxes
|
(14)
|
|
39
|
|
(8)
|
|
25
|
|
(8)
|
Non-GAAP Income (Loss)
Before Income Taxes
|
$
10
|
|
$
(7)
|
|
$
(66)
|
|
$
3
|
|
$
(153)
|
|
|
|
|
|
|
|
|
|
|
Provision for Income
Taxes:
|
|
|
|
|
|
|
|
|
|
GAAP Provision for
Income Taxes
|
$
(12)
|
|
$
(28)
|
|
$
(15)
|
|
$
(40)
|
|
$
(38)
|
Tax Effect on Non-GAAP
Adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-GAAP Provision for
Income Taxes
|
$
(12)
|
|
$
(28)
|
|
$
(15)
|
|
$
(40)
|
|
$
(38)
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
Attributable to Weatherford:
|
|
|
|
|
|
|
|
|
|
GAAP Net Income
(Loss)
|
$
6
|
|
$
(80)
|
|
$
(78)
|
|
$
(74)
|
|
$
(194)
|
Non-GAAP Adjustments,
net of tax
|
(14)
|
|
39
|
|
(8)
|
|
25
|
|
(8)
|
Non-GAAP Net
Loss
|
$
(8)
|
|
$
(41)
|
|
$
(86)
|
|
$
(49)
|
|
$
(202)
|
|
|
|
|
|
|
|
|
|
|
Diluted Income
(Loss) Per Share Attributable to Weatherford:
|
|
|
|
|
|
|
|
|
|
GAAP Diluted Income
(Loss) per Share
|
$
0.08
|
|
$
(1.14)
|
|
$ (1.11)
|
|
$
(1.04)
|
|
$
(2.77)
|
Non-GAAP Adjustments,
net of tax
|
(0.19)
|
|
0.55
|
|
(0.12)
|
|
0.35
|
|
(0.12)
|
Non-GAAP Diluted Loss
per Share
|
$ (0.11)
|
|
$
(0.59)
|
|
$ (1.23)
|
|
$
(0.69)
|
|
$
(2.89)
|
Weatherford
International plc
|
Reconciliation of
GAAP to Non-GAAP Financial Measures
|
Net Income
(Loss) to Adjusted EBITDA (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
($ in
Millions)
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
Net Income (Loss)
Attributable to Weatherford
|
$
6
|
|
$
(80)
|
|
$
(78)
|
|
$
(74)
|
|
$
(194)
|
Net Income
Attributable to Noncontrolling Interests
|
6
|
|
6
|
|
5
|
|
12
|
|
11
|
Net Income
(Loss)
|
12
|
|
(74)
|
|
(73)
|
|
(62)
|
|
(183)
|
Interest Expense,
Net
|
48
|
|
48
|
|
72
|
|
96
|
|
142
|
Income Tax
Provision
|
12
|
|
28
|
|
15
|
|
40
|
|
38
|
Depreciation and
Amortization
|
90
|
|
87
|
|
114
|
|
177
|
|
225
|
EBITDA
|
162
|
|
89
|
|
128
|
|
251
|
|
222
|
|
|
|
|
|
|
|
|
|
|
Other
Adjustments:
|
|
|
|
|
|
|
|
|
|
Other (Credits)
Charges
|
(14)
|
|
19
|
|
(8)
|
|
5
|
|
(8)
|
Restructuring
Charges
|
—
|
|
20
|
|
—
|
|
20
|
|
—
|
Share-Based
Compensation
|
6
|
|
7
|
|
5
|
|
13
|
|
9
|
Other Expense,
Net
|
32
|
|
16
|
|
11
|
|
48
|
|
15
|
Adjusted
EBITDA
|
$
186
|
|
$
151
|
|
$
136
|
|
$
337
|
|
$
238
|
Supplemental
Reconciliation of Non-GAAP Financial Measures
|
Adjusted EBITDA to
Free Cash Flow (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
($ in
Millions)
|
|
June 30,
2022
|
|
March 31,
2022
|
|
June 30,
2021
|
|
June 30,
2022
|
|
June 30,
2021
|
Adjusted
EBITDA
|
|
$
186
|
|
$
151
|
|
$
136
|
|
$
337
|
|
$
238
|
|
Cash From (Used) for
Working Capital
|
|
(20)
|
|
(75)
|
|
12
|
|
(95)
|
|
72
|
|
Capital Expenditures
for Property, Plant and Equipment
|
|
(24)
|
|
(20)
|
|
(9)
|
|
(44)
|
|
(24)
|
|
Cash Paid for
Taxes
|
|
(23)
|
|
(19)
|
|
(17)
|
|
(42)
|
|
(32)
|
|
Cash Paid for Severance
and Restructuring
|
|
(5)
|
|
(5)
|
|
(9)
|
|
(10)
|
|
(21)
|
|
Proceeds from
Disposition of Assets
|
|
23
|
|
20
|
|
11
|
|
43
|
|
22
|
|
Excess and Obsolete
Inventory Charges
|
|
8
|
|
11
|
|
5
|
|
19
|
|
21
|
|
Increase (Decrease) in
Accruals, Net [1]
|
|
14
|
|
(110)
|
|
36
|
|
(96)
|
|
(17)
|
|
Cash Paid for
Interest
|
|
(100)
|
|
(17)
|
|
(117)
|
|
(117)
|
|
(141)
|
Free Cash Flow
[2]
|
|
$
59
|
|
$
(64)
|
|
$
48
|
|
$
(5)
|
|
$
118
|
[1]
|
Increase (Decrease) in
Accruals, Net primarily includes accruals for net employee
benefits, net payments for leases, change in our allowance for
credit losses and foreign currency exchange impact.
|
[2]
|
Free cash flow is a
non-GAAP measure calculated as cash flows provided by operating
activities, less capital expenditures for property, plant and
equipment plus proceeds from the disposition of assets. Management
believes free cash flow is useful to understand liquidity and
should be considered in addition to but not substitute cash flows
provided by operating activities.
|
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SOURCE Weatherford International plc