Item 2.02.
Results of Operations and Financial Condition
On
May 3, 2016
, registrant issued a press release entitled “Halliburton Announces First Quarter Income From Continuing Operations of $0.07 Per Diluted Share, Excluding Special Items."
The text of the Press Release is as follows:
HALLIBURTON ANNOUNCES FIRST QUARTER INCOME FROM CONTINUING OPERATIONS OF $0.07 PER DILUTED SHARE, EXCLUDING SPECIAL ITEMS
Reported loss from continuing operations of $2.81 per diluted share
HOUSTON - May 3, 2016
- Halliburton Company (NYSE:HAL) announced today that income from continuing operations for the first quarter of 2016 was $64 million, or $0.07 per diluted share, excluding special items. This compares to income from continuing operations for the fourth quarter of 2015 of $270 million, or $0.31 per diluted share, excluding special items. Adjusted operating income was $225 million in the first quarter of 2016, compared to adjusted operating income of $473 million in the fourth quarter of 2015. Halliburton's total revenue in the first quarter of 2016 was $4.2 billion, compared to $5.1 billion in the fourth quarter of 2015.
Market conditions continued to negatively impact Halliburton's business in the first quarter of 2016. The rig count declined to historic lows during the quarter, in the face of continued depressed commodity prices, which created further widespread pricing pressure and activity reductions for the company's products and services on a global basis. As a result of these conditions and their corresponding impact on the company’s business outlook, Halliburton recorded company-wide charges related primarily to asset impairments and severance costs of approximately $2.1 billion, after-tax, or $2.39 per diluted share, in the first quarter of 2016, compared to $192 million, after-tax, or $0.22 per diluted share, in the fourth quarter of 2015.
In accordance with Generally Accepted Accounting Principles, and in conjunction with the termination of its merger agreement with Baker Hughes, Halliburton determined that its proposed businesses to be divested no longer meet the assets held for sale criteria as of March 31, 2016. As a result, the company recorded corresponding charges representing the associated depreciation and amortization expense previously suspended for these businesses, along with other divestiture-related costs, within "Baker Hughes acquisition-related costs." In total, Halliburton recorded Baker Hughes acquisition-related costs of $378 million, after-tax, or $0.44 per diluted share, in the first quarter of 2016, compared to $79 million, after-tax, or $0.09 per diluted share, in the fourth quarter of 2015. Halliburton also incurred $45 million, after-tax, or $0.05 per diluted share, of interest expense in the first quarter of 2016 associated with the $7.5 billion of debt issued in late 2015, compared to $27 million, after-tax, or $0.03 per diluted share, in the fourth quarter of 2015.
-more-
Reported loss from continuing operations was $2.4 billion, or $2.81 per diluted share, in the first quarter of 2016, compared to reported loss from continuing operations of $28 million, or $0.03 per diluted share, in the fourth quarter of 2015. Reported operating loss was $3.1 billion for the first quarter of 2016, compared to reported operating income of $86 million for the fourth quarter of 2015.
This press release should be read in conjunction with Halliburton’s operational update press release issued on April 22, 2016.
-more-
About Halliburton
Founded in 1919, Halliburton is one of the world's largest providers of products and services to the energy industry. With over 55,000 employees, representing 140 nationalities and operations in approximately 70 countries, the company serves the upstream oil and gas industry throughout the lifecycle of the reservoir - from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production through the life of the field. Visit the company’s website at
www.halliburton.com
. Connect with Halliburton on
Facebook
,
Twitter
,
LinkedIn
and
YouTube
.
NOTE: The statements in this press release that are not historical statements, including statements regarding future financial performance, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: with respect to the Macondo well incident, final court approval of, and the satisfaction of the conditions in, Halliburton's September 2014 settlement, including the results of any appeals of rulings in the multi-district litigation; indemnification and insurance matters; with respect to repurchases of Halliburton common stock, the continuation or suspension of the repurchase program, the amount, the timing and the trading prices of Halliburton common stock, and the availability and alternative uses of cash; changes in the demand for or price of oil and/or natural gas can be significantly impacted by weakness in the worldwide economy; consequences of audits and investigations by domestic and foreign government agencies and legislative bodies and related publicity and potential adverse proceedings by such agencies; protection of intellectual property rights and against cyber attacks; compliance with environmental laws; changes in government regulations and regulatory requirements, particularly those related to offshore oil and natural gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; compliance with laws related to income taxes and assumptions regarding the generation of future taxable income; risks of international operations, including risks relating to unsettled political conditions, war, the effects of terrorism, foreign exchange rates and controls, international trade and regulatory controls, and doing business with national oil companies; weather-related issues, including the effects of hurricanes and tropical storms; changes in capital spending by customers; delays or failures by customers to make payments owed to us; execution of long-term, fixed-price contracts; structural changes in the oil and natural gas industry; maintaining a highly skilled workforce; availability and cost of raw materials; and integration and success of acquired businesses and operations of joint ventures. Halliburton's Form 10-K for the year ended December 31, 2015, recent Current Reports on Form 8-K, and other Securities and Exchange Commission filings discuss some of the important risk factors identified that may affect Halliburton's business, results of operations, and financial condition. Halliburton undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
-more-