Weatherford International plc (NASDAQ: WFRD) (“Weatherford” or the
“Company”) announced today its results for the fourth quarter of
2023 and full year 2023.
Revenues for the fourth quarter of 2023 were
$1,362 million, an increase of 4% sequentially and 13%
year-over-year. Operating income was $216 million in the fourth
quarter of 2023, compared to $218 million in the third quarter of
2023 and $169 million in the fourth quarter of 2022. Net income in
the fourth quarter of 2023 was $140 million, an increase of 14% or
91 basis points sequentially, and an increase of 94% or 432 basis
points year-over-year. Adjusted EBITDA* was $321 million, an
increase of 5% or 34 basis points sequentially, and an increase of
21% or 157 basis points year-over-year. Basic income per share was
$1.94, compared to $1.70 in the third quarter of 2023 and $1.01 in
the fourth quarter of 2022.
Fourth quarter 2023 cash flows provided by
operating activities were $375 million, compared to $172 million in
the third quarter of 2023 and $193 million in the fourth quarter of
2022. Adjusted free cash flow* was $315 million, an increase of
$178 million sequentially and $144 million year-over-year. Capital
expenditures were $67 million in the fourth quarter of 2023,
compared to $42 million in the third quarter of 2023 and $49
million in the fourth quarter of 2022.
Revenue for the full year 2023 was $5,135
million, compared to revenues of $4,331 million in 2022. Operating
Income for the full year was $820 million, compared to $412 million
in 2022. The company’s full year 2023 net income was $417 million,
compared to $26 million in 2022. Full year cash flows provided by
operations were $832 million, compared to $349 million in 2022.
Adjusted free cash flow for the full year was $651 million compared
to $299 million in 2022. Capital expenditures for full year 2023
were $209 million, compared to $132 million in 2022.
*Non-GAAP - refer to the section titled Non-GAAP
Financial Measures Defined and GAAP to Non-GAAP Financial Measures
Reconciled
Girish Saligram, President and Chief Executive
Officer, commented, “The results from the fourth quarter bookend
another transformative year for the company and underscore the
fundamentally changed nature of our operating profile. I am very
grateful to our One Weatherford team for their continued passion
and commitment in delivering these results.
2023 top line growth of 19%, adjusted free cash
flow generation of $651 million, margin expansion of 423 basis
points, and adjusted EBITDA margins of 23.1% set another record.
Simultaneously, we made measurable improvements in our capital
structure, with continued debt pay down, an enhanced credit
facility, and credit rating upgrades. These actions and results
reflect our commitment to achieving our strategic priorities and
position us for a new phase of growth.
On February 1, 2024, we completed the
acquisition of two technology companies in the wireline
space from Turnbridge Capital - Probe and Impact Selector
International, both widely recognized brands. We also completed the
acquisition of Ardyne, a leader in well de-commissioning technology
with whom we have had a partnership since the fourth quarter of
2022. These companies are strategically aligned with our portfolio
and fit well within our acquisition criterion. We have very robust
integration plans and are excited about the additional technology
differentiation they add to Weatherford.
Our outlook for 2024 remains positive, with
market fundamentals and international and offshore activity
continuing to show resilience. We expect full year 2024 revenue to
grow between double digits and low teens year-over-year,
spearheaded by robust growth in the Middle East, and for adjusted
EBITDA margins to make meaningful progress towards our goal of
25%.”
*Non-GAAP - refer to the section titled Non-GAAP
Financial Measures Defined and GAAP to Non-GAAP Financial Measures
Reconciled
Operational Highlights
- QatarEnergy
awarded us three, five-year contracts to provide Completions and
Gas Lift equipment, including Well and Intervention Services.
- Petrobras
awarded us a five-year contract in Brazil to address subsea
intervention and commissioning through our comprehensive offering,
enhanced by our Centro™ well construction optimization
platform.
- ENI Italy
awarded us a three-year contract for the provision of Wireline
services, in addition to a three-year contract for the supply of
Liner Hanger systems for their onshore and offshore
operations.
- Shell Brunei
awarded us a three-year contract for the provision of Well
Services, including the supply of thru-tubing products and
services.
- Exxon awarded us
a two-year Completions and Sand Control systems on the Guyana
offshore programs.
- BPX Energy
awarded us a two-year contract to supply Cementation Products for
their Eagle Ford asset
- Cairn awarded us
a three-year contract to provide Completions and Liner Hanger
systems and services on the Barmer field in India
- A major operator
in Asia awarded us a one-year contract for the supply of MPD
systems for Carbon Capture and Sequestration (CCS) on an offshore
gas development project.
- PTTEP Thailand
awarded us a four-year contract for the provision of Fishing and
Well Abandonment Services for Offshore Drilling operations.
Technology Highlights
- Weatherford
received OTC Asia Spotlight on New Technology award for
StringGuard™, a system that prevents dropped tubulars adding safety
and reliability to both offshore and onshore rig operations.
- We successfully
installed fiber optic sensing technology for ADNOC’s first CCS well
in support of their low-carbon initiatives.
- Through our
partnership with Ardyne, Weatherford provided a unique, integrated
solution that delivered significant value to a major operator in
the Middle East, combining Weatherford’s existing portfolio with
Ardyne’s industry leading technology to extend production on an
aging asset.
- Deployed an engineered downhole
Progressive Cavity Pump for 5E Advanced Materials to handle the
extreme downhole conditions for a boron solution mining
project.
Liquidity
We closed the fourth quarter 2023 with total
cash of approximately $1,063 million as of December 31, 2023,
up $117 million sequentially.
Net cash provided by operating activities during
the fourth quarter 2023 was $375 million, up $203 million
sequentially, and up $182 million year-over-year. Adjusted free
cash flow* of $315 million was up $178 million sequentially
and $144 million compared to the fourth quarter of 2022. The
increases were mostly attributed to heightened collections
activity.
In the fourth quarter 2023, we repurchased $75
million of our 6.5% Senior Secured Notes (“Secured Notes”) and an
additional $151 million in January 2024. The principal
remaining on our Secured Notes was approximately $248 million as of
December 31, 2023 and $97 million as of the date of this
release.
*Non-GAAP - refer to the section titled Non-GAAP
Financial Measures Defined and GAAP to Non-GAAP Financial Measures
Reconciled
Results by Reportable
Segment
Drilling & Evaluation
(“DRE”)
|
|
Three Months Ended |
|
Variance |
|
|
Twelve Months Ended |
|
Variance |
($ in Millions) |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Dec 31, 2022 |
|
Seq. |
|
|
YoY |
|
Dec 31, 2023 |
|
Dec 31, 2022 |
|
YoY |
Revenue |
|
$ |
382 |
|
|
$ |
388 |
|
|
$ |
371 |
|
|
(2) |
% |
|
3 |
% |
|
$ |
1,536 |
|
|
$ |
1,328 |
|
|
16 |
% |
Segment Adjusted EBITDA |
|
$ |
97 |
|
|
$ |
111 |
|
|
$ |
111 |
|
|
(13) |
% |
|
(13) |
% |
|
$ |
422 |
|
|
$ |
324 |
|
|
30 |
% |
Segment Adj EBITDA Margin |
|
|
25.4 |
% |
|
|
28.6 |
% |
|
|
29.9 |
% |
|
(322)bps |
|
(453)bps |
|
|
27.5 |
% |
|
|
24.4 |
% |
|
308bps |
Fourth quarter 2023 DRE revenues of $382 million
decreased by $6 million, or 2% sequentially, primarily due to lower
activity for drilling-related services in Latin America caused by
weather, partially offset by increased wireline activity.
Year-over-year DRE revenues increased by $11 million, or 3%,
primarily due to international activity increases in wireline and
drilling-related services.
Fourth quarter 2023 DRE segment adjusted EBITDA
of $97 million decreased by $14 million, or 13% sequentially,
primarily due to lower activity and a change in mix around
drilling-related services. Year-over-year, DRE segment adjusted
EBITDA decreased by $14 million, or 13%, primarily due to a change
in mix around drilling-related services.
Full year 2023 DRE revenues of $1,536 million
increased by $208 million, or 16% compared to 2022, with increased
activity primarily from drilling-related services in Latin America
and the Middle East/North Africa/Asia regions.
Full year 2023 DRE segment adjusted EBITDA of
$422 million increased by $98 million, or 30% compared to 2022,
with margins expanding 308 basis points primarily due to higher
activity.
Well Construction and Completions
(“WCC”)
|
|
Three Months Ended |
|
Variance |
|
Twelve Months Ended |
|
Variance |
($ in Millions) |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Dec 31, 2022 |
|
Seq. |
|
YoY |
|
Dec 31, 2023 |
|
Dec 31, 2022 |
|
YoY |
Revenue |
|
$ |
480 |
|
|
$ |
459 |
|
|
$ |
403 |
|
|
5 |
% |
|
19 |
% |
|
$ |
1,800 |
|
|
$ |
1,521 |
|
|
18 |
% |
Segment Adjusted EBITDA |
|
$ |
131 |
|
|
$ |
119 |
|
|
$ |
87 |
|
|
10 |
% |
|
51 |
% |
|
$ |
455 |
|
|
$ |
299 |
|
|
52 |
% |
Segment Adj EBITDA Margin |
|
|
27.3 |
% |
|
|
25.9 |
% |
|
|
21.6 |
% |
|
137bps |
|
570bps |
|
|
25.3 |
% |
|
|
19.7 |
% |
|
562bps |
Fourth quarter 2023 WCC revenues of $480 million
increased by $21 million, or 5% sequentially, primarily due to
higher activity in completions and cementation products in the
Middle East/North Africa/Asia regions, partially offset by lower
activity in North America. Year-over-year WCC revenues increased by
$77 million, or 19%, primarily due to increased completions
activity, partially offset by lower activity in North America.
Fourth quarter 2023 WCC segment adjusted EBITDA
of $131 million increased by $12 million, or 10% sequentially,
primarily due to higher international activity and a favorable
change in mix around tubular running services. Year-over-year, WCC
segment adjusted EBITDA increased by $44 million, or 51%, primarily
due to higher fall through from increased activity across all
product lines.
Full year 2023 WCC revenues of $1,800 million
increased by $279 million, or 18% compared to 2022, with increased
international activity primarily from completions and cementation
products.
Full year 2023 WCC segment adjusted EBITDA of
$455 million increased by $156 million, or 52% compared to 2022,
with margins increasing 562 basis points due to increased activity
and higher fall through.
Production and Intervention
(“PRI”)
|
|
Three Months Ended |
|
Variance |
|
Twelve Months Ended |
|
Variance |
($ in Millions) |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Dec 31, 2022 |
|
Seq. |
|
YoY |
|
Dec 31, 2023 |
|
Dec 31, 2022 |
|
YoY |
Revenues |
|
$ |
386 |
|
|
$ |
371 |
|
|
$ |
407 |
|
|
4 |
% |
|
(5) |
% |
|
$ |
1,472 |
|
|
$ |
1,395 |
|
|
6 |
% |
Segment Adjusted EBITDA |
|
$ |
88 |
|
|
$ |
86 |
|
|
$ |
88 |
|
|
2 |
% |
|
— |
% |
|
$ |
323 |
|
|
$ |
261 |
|
|
24 |
% |
Segment Adj EBITDA Margin |
|
|
22.8 |
% |
|
|
23.2 |
% |
|
|
21.6 |
% |
|
(38)bps |
|
118bps |
|
|
21.9 |
% |
|
|
18.7 |
% |
|
323bps |
Fourth quarter 2023 PRI revenues of $386 million
increased by $15 million, or 4% sequentially, primarily due to
higher activity in digital solutions and international artificial
lift, partially offset by lower activity for international pressure
pumping and lower activity in North America for artificial lift.
Year-over-year PRI revenues decreased by $21 million, or 5%,
primarily due to lower activity in North America for artificial
lift, partially offset by higher international activity in digital
solutions, artificial lift and intervention services.
Fourth quarter 2023 PRI segment adjusted EBITDA
of $88 million, increased by $2 million, or 2% sequentially,
primarily due to higher fall through for digital solutions,
partially offset by lower activity for international pressure
pumping. Year-over-year, PRI segment adjusted EBITDA was flat but
margins increased by 118 basis points, primarily due to a
significant increase in digital solutions activity, and higher
margins in artificial lift despite an overall reduction in activity
in North America.
Full year 2023 PRI revenues of $1,472 million
increased by $77 million, or 6% compared to 2022, primarily due to
increased activity in the Middle East/North Africa/Asia and Latin
America regions.
Full year 2023 PRI segment adjusted EBITDA of
$323 million, increased by $62 million, or 24% compared to 2022,
with margins increasing 323 basis points mainly due to an increase
in activity.
Revenue by Geography
|
|
Three Months Ended |
|
Variance |
|
Twelve Months Ended |
|
Variance |
($ in Millions) |
|
Dec 31, 2023 |
|
Sep 30, 2023 |
|
Dec 31, 2022 |
|
Seq. |
|
YoY |
|
Dec 31, 2023 |
|
Dec 31, 2022 |
|
YoY |
North America |
|
$ |
248 |
|
$ |
269 |
|
$ |
301 |
|
(8) |
% |
|
(18) |
% |
|
$ |
1,068 |
|
$ |
1,104 |
|
(3) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
$ |
1,114 |
|
$ |
1,044 |
|
$ |
908 |
|
7 |
% |
|
23 |
% |
|
$ |
4,067 |
|
$ |
3,227 |
|
26 |
% |
Latin America |
|
|
342 |
|
|
357 |
|
|
290 |
|
(4) |
% |
|
18 |
% |
|
|
1,387 |
|
|
1,062 |
|
31 |
% |
Middle East/North Africa/Asia |
|
|
547 |
|
|
471 |
|
|
387 |
|
16 |
% |
|
41 |
% |
|
|
1,815 |
|
|
1,401 |
|
30 |
% |
Europe/Sub-Sahara Africa/Russia |
|
|
225 |
|
|
216 |
|
|
231 |
|
4 |
% |
|
(3) |
% |
|
|
865 |
|
|
764 |
|
13 |
% |
Total Revenue |
|
$ |
1,362 |
|
$ |
1,313 |
|
$ |
1,209 |
|
4 |
% |
|
13 |
% |
|
$ |
5,135 |
|
$ |
4,331 |
|
19 |
% |
North America
Fourth quarter 2023 North America revenue of
$248 million decreased by $21 million, or 8% sequentially,
primarily due to lower PRI and WCC activity in the United States.
Year-over-year North America revenue decreased by $53 million, or
18%, primarily due to the slowdown in overall activity in the
United States (“US”) and Canada, partially offset by higher
activity in the US Gulf of Mexico.
Full year 2023 North America revenue of $1,068
million decreased by $36 million, or 3% compared to 2022, primarily
due to lower artificial lift activity in the United States and
lower completions activity in Canada, partially offset by increased
activity in the US Gulf of Mexico across all the segments.
International
Fourth quarter 2023 international revenue of
$1,114 million increased 7% sequentially and 23% year over year,
and full year 2023 international revenue of $4,067 million
increased 26% compared to 2022.
Fourth quarter 2023 Latin America revenue of
$342 million decreased by $15 million, or 4% sequentially,
primarily due to the impact of weather disruptions in Mexico on
drilling-related services and lower completions activity in Brazil
due to timing of certain product deliveries. Year-over-year, Latin
America revenue increased by $52 million, or 18%, primarily due to
higher activity in all our segments.
Full year 2023 Latin America revenue of $1,387
million increased by $325 million, or 31% compared to 2022,
primarily due to increased activity across all segments and in
integrated services and projects.
Fourth quarter 2023 Middle East/North
Africa/Asia revenue of $547 million increased by $76 million, or
16% sequentially, primarily driven by higher activity across all
segments as well as in integrated services and projects, most
notably in Saudi Arabia and the United Arab Emirates.
Year-over-year, the Middle East/North Africa/Asia revenue increased
by $160 million, or 41%, primarily due to higher activity in all
segments as well as in integrated services and projects.
Full year 2023 Middle East/North Africa/Asia
revenues of $1,815 million increased by $414 million, or 30%
compared to 2022, primarily due to increased activity across all
segments as well as in integrated services and projects, most
notably in Saudi Arabia and Oman.
Fourth quarter 2023 Europe/Sub-Sahara
Africa/Russia revenue of $225 million increased by $9 million, or
4% sequentially, mainly due to higher PRI and DRE activity in
Europe. Year-over-year, Europe/Sub-Sahara Africa/Russia revenue
decreased by $6 million, or 3%, primarily due to lower revenue in
Russia, partially offset by increased WCC activity in Europe and
the Sub-Sahara Africa regions.
Full year 2023 Europe/Sub-Sahara Africa/Russia
revenues of $865 million increased by $101 million, or 13% compared
to 2022, mainly due to increased activity in WCC and DRE.
Acquisition Details On February
1, 2024, we acquired ISI Holding Company, LLC (“ISI”) and Probe
Technologies Holdings, Inc. (“Probe”). Aggregate consideration for
these acquisitions was 844,702 ordinary shares, plus $6 million in
cash, subject to customary adjustments and an earn out which
applies to 2024 performance. Included in this consideration as part
of the acquisition of Probe, Weatherford approved the grant of an
aggregate of 28,632 ordinary shares to four individuals who were
offered employment with Weatherford following the closing of the
acquisitions. The issuance of these ordinary shares was a material
inducement to them to accept employment with Weatherford. These
shares will be issued within 30 days following the closing. This
disclosure is a requirement of the Nasdaq rule 5635 (c)(4).
About WeatherfordWeatherford
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 conducts
business in approximately 75 countries and has approximately 18,500
team members representing more than 110 nationalities and 335
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
Wednesday, February 7, 2024, to discuss the Company’s results
for the fourth quarter and full year ended December 31, 2023. 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/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. Participants 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 February 21, 2024, 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 5521443. A replay and transcript of the earnings call will
also be available in the investor relations section of the
Company’s website.
ContactsFor
Investors:Mohammed TopiwalaVice President, Investor
Relations and M&A+1
713-836-7777investor.relations@weatherford.com
For Media:Kelley HughesSenior
Director, Communications & Employee Engagement+1
713-836-4193media@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, adjusted EBITDA*,
adjusted EBITDA margin*, adjusted 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, based on factors
including but not limited to: global political disturbances, war,
terrorist attacks, changes in global trade policies, weak local
economic conditions and international currency fluctuations;
general global economic repercussions related to U.S. and global
inflationary pressures and potential recessionary concerns; various
effects from the Russia Ukraine conflict including, but not limited
to, nationalization of assets, extended business interruptions,
sanctions, treaties and regulations imposed by various countries,
associated operational and logistical challenges, and impacts to
the overall global energy supply; cybersecurity issues; our ability
to comply with, and respond to, climate change, environmental,
social and governance and other sustainability initiatives and
future legislative and regulatory measures both globally and in
specific geographic regions; the potential for a resurgence of a
pandemic in a given geographic area and related disruptions to our
business, employees, customers, suppliers and other partners; the
price and price volatility of, and demand for, oil and natural gas;
the macroeconomic outlook for the oil and gas industry; our ability
to generate cash flow from operations to fund our operations; our
ability to effectively and timely adapt our technology portfolio,
products and services to address and participate in changes to the
market demands for the transition to alternate sources of energy
such as geothermal, carbon capture and responsible abandonment,
including our digitalization efforts; 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
statement 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.
*Non-GAAP - refer to the section titled Non-GAAP
Financial Measures Defined and GAAP to Non-GAAP Financial Measures
Reconciled
Weatherford International plc |
Selected Statements of Operations (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
($ in Millions, Except Per Share Amounts) |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
|
December 31, 2023 |
|
December 31, 2022 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
DRE Revenues |
|
$ |
382 |
|
|
$ |
388 |
|
|
$ |
371 |
|
|
$ |
1,536 |
|
|
$ |
1,328 |
|
WCC Revenues |
|
|
480 |
|
|
|
459 |
|
|
|
403 |
|
|
|
1,800 |
|
|
|
1,521 |
|
PRI Revenues |
|
|
386 |
|
|
|
371 |
|
|
|
407 |
|
|
|
1,472 |
|
|
|
1,395 |
|
All Other |
|
|
114 |
|
|
|
95 |
|
|
|
28 |
|
|
|
327 |
|
|
|
87 |
|
Total Revenues |
|
|
1,362 |
|
|
|
1,313 |
|
|
|
1,209 |
|
|
|
5,135 |
|
|
|
4,331 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income: |
|
|
|
|
|
|
|
|
|
|
DRE Segment Adjusted EBITDA[1] |
|
$ |
97 |
|
|
$ |
111 |
|
|
$ |
111 |
|
|
$ |
422 |
|
|
$ |
324 |
|
WCC Segment Adjusted EBITDA[1] |
|
|
131 |
|
|
|
119 |
|
|
|
87 |
|
|
|
455 |
|
|
|
299 |
|
PRI Segment Adjusted EBITDA[1] |
|
|
88 |
|
|
|
86 |
|
|
|
88 |
|
|
|
323 |
|
|
|
261 |
|
All Other [2] |
|
|
13 |
|
|
|
7 |
|
|
|
(4 |
) |
|
|
38 |
|
|
|
1 |
|
Corporate [2] |
|
|
(8 |
) |
|
|
(18 |
) |
|
|
(16 |
) |
|
|
(52 |
) |
|
|
(68 |
) |
Depreciation and Amortization |
|
|
(83 |
) |
|
|
(83 |
) |
|
|
(84 |
) |
|
|
(327 |
) |
|
|
(349 |
) |
Share-Based Compensation |
|
|
(9 |
) |
|
|
(9 |
) |
|
|
(7 |
) |
|
|
(35 |
) |
|
|
(25 |
) |
Other (Charges) Credits |
|
|
(13 |
) |
|
|
5 |
|
|
|
(6 |
) |
|
|
(4 |
) |
|
|
(31 |
) |
Operating Income |
|
|
216 |
|
|
|
218 |
|
|
|
169 |
|
|
|
820 |
|
|
|
412 |
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense): |
|
|
|
|
|
|
|
|
|
|
Interest Expense, Net of Interest Income of $12, $15, $12, $59 and
$31 |
|
|
(31 |
) |
|
|
(30 |
) |
|
|
(39 |
) |
|
|
(123 |
) |
|
|
(179 |
) |
Loss on Blue Chip Swap Securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(57 |
) |
|
|
— |
|
Loss on Extinguishment of Debt and Bond Redemption Premium |
|
|
(2 |
) |
|
|
— |
|
|
|
(3 |
) |
|
|
(5 |
) |
|
|
(5 |
) |
Other Expense, Net |
|
|
(34 |
) |
|
|
(24 |
) |
|
|
(30 |
) |
|
|
(129 |
) |
|
|
(90 |
) |
Income Before Income Taxes |
|
|
149 |
|
|
|
164 |
|
|
|
97 |
|
|
|
506 |
|
|
|
138 |
|
Income Tax Provision |
|
|
(2 |
) |
|
|
(33 |
) |
|
|
(21 |
) |
|
|
(57 |
) |
|
|
(87 |
) |
Net Income |
|
|
147 |
|
|
|
131 |
|
|
|
76 |
|
|
|
449 |
|
|
|
51 |
|
Net Income Attributable to Noncontrolling Interests |
|
|
7 |
|
|
|
8 |
|
|
|
4 |
|
|
|
32 |
|
|
|
25 |
|
Net Income Attributable to Weatherford |
|
$ |
140 |
|
|
$ |
123 |
|
|
$ |
72 |
|
|
$ |
417 |
|
|
$ |
26 |
|
|
|
|
|
|
|
|
|
|
|
|
Basic Income Per Share |
|
$ |
1.94 |
|
|
$ |
1.70 |
|
|
$ |
1.01 |
|
|
$ |
5.79 |
|
|
$ |
0.37 |
|
Basic Weighted Average Shares Outstanding |
|
|
72 |
|
|
|
72 |
|
|
|
71 |
|
|
|
72 |
|
|
|
71 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Income Per Share |
|
$ |
1.90 |
|
|
$ |
1.66 |
|
|
$ |
0.99 |
|
|
$ |
5.66 |
|
|
$ |
0.36 |
|
Diluted Weighted Average Shares Outstanding |
|
|
74 |
|
|
|
74 |
|
|
|
73 |
|
|
|
74 |
|
|
|
72 |
|
- Segment adjusted EBITDA is our
primary measure of segment profitability under U.S. GAAP ASC 280
“Segment Reporting” and represents segment earnings before
interest, taxes, depreciation, amortization, share-based
compensation expense and other adjustments. Research and
development expenses are included in segment adjusted EBITDA.
- All Other includes business
activities related to all other segments (profit and loss) and
Corporate includes overhead support and centrally managed or shared
facilities costs. All Other and Corporate do not individually meet
the criteria for segment reporting. The improvement in All Other in
2023 was primarily due to higher activity related to our integrated
services and projects.
Weatherford International plc |
Selected Balance Sheet Data (Unaudited) |
|
|
|
|
($ in Millions) |
December 31, 2023 |
|
December 31, 2022 |
Assets: |
|
|
|
Cash and Cash Equivalents |
$ |
958 |
|
$ |
910 |
Restricted Cash |
|
105 |
|
|
202 |
Accounts Receivable, Net |
|
1,216 |
|
|
989 |
Inventories, Net |
|
788 |
|
|
689 |
Property, Plant and Equipment, Net |
|
957 |
|
|
918 |
Intangibles, Net |
|
370 |
|
|
506 |
|
|
|
|
Liabilities: |
|
|
|
Accounts Payable |
|
679 |
|
|
460 |
Accrued Salaries and Benefits |
|
387 |
|
|
367 |
Current Portion of Long-term Debt |
|
168 |
|
|
45 |
Long-term Debt |
|
1,715 |
|
|
2,203 |
|
|
|
|
Shareholders’ Equity: |
|
|
|
Total Shareholders’ Equity |
|
922 |
|
|
551 |
Weatherford International plc |
Selected Cash Flows Information (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
($ in Millions) |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
|
December 31, 2023 |
|
December 31, 2022 |
Cash Flows From Operating Activities: |
|
|
|
|
|
|
|
|
|
|
Net Income |
|
$ |
147 |
|
|
$ |
131 |
|
|
$ |
76 |
|
|
$ |
449 |
|
|
$ |
51 |
|
Adjustments to Reconcile Net Income to Net Cash Provided By
Operating Activities: |
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
83 |
|
|
|
83 |
|
|
|
84 |
|
|
|
327 |
|
|
|
349 |
|
Foreign Exchange Losses |
|
|
43 |
|
|
|
15 |
|
|
|
25 |
|
|
|
116 |
|
|
|
71 |
|
Loss on Extinguishment of Debt and Bond Redemption Premium |
|
|
2 |
|
|
|
— |
|
|
|
3 |
|
|
|
5 |
|
|
|
5 |
|
Loss on Blue Chip Swap Securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
57 |
|
|
|
— |
|
Inventory Charges |
|
|
8 |
|
|
|
— |
|
|
|
6 |
|
|
|
19 |
|
|
|
36 |
|
Loss (Gain) on Disposition of Assets |
|
|
— |
|
|
|
(4 |
) |
|
|
(19 |
) |
|
|
(11 |
) |
|
|
(41 |
) |
Deferred Income Tax Provision (Benefit) |
|
|
(19 |
) |
|
|
(14 |
) |
|
|
(20 |
) |
|
|
(86 |
) |
|
|
4 |
|
Employee Share-Based Compensation Expense |
|
|
9 |
|
|
|
9 |
|
|
|
7 |
|
|
|
35 |
|
|
|
25 |
|
Changes in Accounts Receivable, Inventory, and Accounts
Payable: |
|
|
|
|
|
|
|
|
|
|
Accounts Receivable |
|
|
59 |
|
|
|
(197 |
) |
|
|
(90 |
) |
|
|
(221 |
) |
|
|
(193 |
) |
Inventories |
|
|
(11 |
) |
|
|
(28 |
) |
|
|
43 |
|
|
|
(114 |
) |
|
|
(56 |
) |
Accounts Payable |
|
|
58 |
|
|
|
105 |
|
|
|
35 |
|
|
|
231 |
|
|
|
84 |
|
Other Changes, Net |
|
|
(4 |
) |
|
|
72 |
|
|
|
43 |
|
|
|
25 |
|
|
|
14 |
|
Net Cash Provided By Operating Activities |
|
|
375 |
|
|
|
172 |
|
|
|
193 |
|
|
|
832 |
|
|
|
349 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows From Investing Activities: |
|
|
|
|
|
|
|
|
|
|
Capital Expenditures for Property, Plant and Equipment |
|
|
(67 |
) |
|
|
(42 |
) |
|
|
(49 |
) |
|
|
(209 |
) |
|
|
(132 |
) |
Proceeds from Disposition of Assets |
|
|
7 |
|
|
|
7 |
|
|
|
27 |
|
|
|
28 |
|
|
|
82 |
|
Purchases of Blue Chip Swap Securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(110 |
) |
|
|
— |
|
Proceeds from Sales of Blue Chip Swap Securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
53 |
|
|
|
— |
|
Other Investing Activities |
|
|
(71 |
) |
|
|
(1 |
) |
|
|
(10 |
) |
|
|
(51 |
) |
|
|
(4 |
) |
Net Cash Used In Investing Activities |
|
|
(131 |
) |
|
|
(36 |
) |
|
|
(32 |
) |
|
|
(289 |
) |
|
|
(54 |
) |
|
|
|
|
|
|
|
|
|
|
|
Cash Flows From Financing Activities: |
|
|
|
|
|
|
|
|
|
|
Repayments and Repurchases of Long-term Debt |
|
|
(80 |
) |
|
|
(76 |
) |
|
|
(136 |
) |
|
|
(386 |
) |
|
|
(198 |
) |
Tax Remittance on Equity Awards Vested |
|
|
(2 |
) |
|
|
— |
|
|
|
(1 |
) |
|
|
(56 |
) |
|
|
(4 |
) |
Other Financing Activities |
|
|
(44 |
) |
|
|
(15 |
) |
|
|
(22 |
) |
|
|
(72 |
) |
|
|
(46 |
) |
Net Cash Used In Financing Activities |
|
$ |
(126 |
) |
|
$ |
(91 |
) |
|
$ |
(159 |
) |
|
$ |
(514 |
) |
|
$ |
(248 |
) |
Weatherford International plc |
Non-GAAP Financial Measures Defined
(Unaudited) |
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 results reported in accordance with
GAAP but should be viewed in addition to the Company’s reported
results prepared in accordance with GAAP.
Adjusted EBITDA* - Adjusted EBITDA* is a
non-GAAP measure and represents consolidated income before interest
expense, net, income taxes, depreciation and amortization expense,
and excludes, among other items, restructuring charges, share-based
compensation expense, as well as other charges and credits.
Management believes adjusted EBITDA* is useful to assess and
understand normalized operating performance and trends. Adjusted
EBITDA* should be considered in addition to, but not as a
substitute for consolidated net income and should be viewed in
addition to the Company's reported results prepared in accordance
with GAAP.
Adjusted EBITDA margin* - Adjusted EBITDA
margin* is a non-GAAP measure which is calculated by dividing
consolidated adjusted EBITDA* by consolidated revenues. Management
believes adjusted EBITDA margin* is useful to assess and understand
normalized operating performance and trends. Adjusted EBITDA
margin* should be considered in addition to, but not as a
substitute for consolidated net income margin and should be viewed
in addition to the Company's reported results prepared in
accordance with GAAP.
Adjusted Free Cash Flow* (formerly titled as
Free Cash Flow) - Adjusted free cash flow* is a non-GAAP measure
and represents cash flows provided by (used in) operating
activities, less capital expenditures plus proceeds from the
disposition of assets. Management believes adjusted free cash flow*
is useful to understand our performance at generating cash and
demonstrates our discipline around the use of cash. Adjusted free
cash flow* should be considered in addition to, but not as a
substitute for cash flows provided by operating activities and
should be viewed in addition to the Company's reported results
prepared in accordance with GAAP.
*Non-GAAP - as defined above and reconciled to
the GAAP measures in the section titled GAAP to Non-GAAP Financial
Measures Reconciled
Weatherford International plc |
GAAP to Non-GAAP Financial Measures Reconciled
(Unaudited) |
($ in Millions, Except Margin in Percentages) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
($ in Millions) |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
|
December 31, 2023 |
|
December 31, 2022 |
Revenues |
|
$ |
1,362 |
|
|
$ |
1,313 |
|
|
$ |
1,209 |
|
|
$ |
5,135 |
|
|
$ |
4,331 |
|
Net Income Attributable to Weatherford |
|
$ |
140 |
|
|
$ |
123 |
|
|
$ |
72 |
|
|
$ |
417 |
|
|
$ |
26 |
|
Net Income Margin |
|
|
10.3 |
% |
|
|
9.4 |
% |
|
|
6.0 |
% |
|
|
8.1 |
% |
|
|
0.6 |
% |
Adjusted EBITDA* |
|
$ |
321 |
|
|
$ |
305 |
|
|
$ |
266 |
|
|
$ |
1,186 |
|
|
$ |
817 |
|
Adjusted EBITDA Margin* |
|
|
23.6 |
% |
|
|
23.2 |
% |
|
|
22.0 |
% |
|
|
23.1 |
% |
|
|
18.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable to Weatherford |
|
$ |
140 |
|
|
$ |
123 |
|
|
$ |
72 |
|
|
$ |
417 |
|
|
$ |
26 |
|
Net Income Attributable to Noncontrolling Interests |
|
|
7 |
|
|
|
8 |
|
|
|
4 |
|
|
|
32 |
|
|
|
25 |
|
Income Tax Provision |
|
|
2 |
|
|
|
33 |
|
|
|
21 |
|
|
|
57 |
|
|
|
87 |
|
Interest Expense, Net of Interest Income of $12, $15, $12, $59 and
$31 |
|
|
31 |
|
|
|
30 |
|
|
|
39 |
|
|
|
123 |
|
|
|
179 |
|
Loss on Blue Chip Swap Securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
57 |
|
|
|
— |
|
Loss on Extinguishment of Debt and Bond Redemption Premium |
|
|
2 |
|
|
|
— |
|
|
|
3 |
|
|
|
5 |
|
|
|
5 |
|
Other Expense, Net |
|
|
34 |
|
|
|
24 |
|
|
|
30 |
|
|
|
129 |
|
|
|
90 |
|
Operating Income |
|
|
216 |
|
|
|
218 |
|
|
|
169 |
|
|
|
820 |
|
|
|
412 |
|
Depreciation and Amortization |
|
|
83 |
|
|
|
83 |
|
|
|
84 |
|
|
|
327 |
|
|
|
349 |
|
Other Charges (Credits) |
|
|
13 |
|
|
|
(5 |
) |
|
|
6 |
|
|
|
4 |
|
|
|
31 |
|
Share-Based Compensation |
|
|
9 |
|
|
|
9 |
|
|
|
7 |
|
|
|
35 |
|
|
|
25 |
|
Adjusted EBITDA* |
|
$ |
321 |
|
|
$ |
305 |
|
|
$ |
266 |
|
|
$ |
1,186 |
|
|
$ |
817 |
|
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided By Operating Activities |
|
$ |
375 |
|
|
$ |
172 |
|
|
$ |
193 |
|
|
$ |
832 |
|
|
$ |
349 |
|
Capital Expenditures for Property, Plant and Equipment |
|
|
(67 |
) |
|
|
(42 |
) |
|
|
(49 |
) |
|
|
(209 |
) |
|
|
(132 |
) |
Proceeds from Disposition of Assets |
|
|
7 |
|
|
|
7 |
|
|
|
27 |
|
|
|
28 |
|
|
|
82 |
|
Adjusted Free Cash Flow* |
|
$ |
315 |
|
|
$ |
137 |
|
|
$ |
171 |
|
|
$ |
651 |
|
|
$ |
299 |
|
*Non-GAAP - as reconciled to the GAAP measures
above and defined in the section titled Non-GAAP Financial Measures
Defined
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