NOV (NOV) 8-K Results of Operations and Financial Condition

Exhibit 99.1

NATIONAL OILWELL VARCO, INC.

RECAST NEW REPORTING SEGMENTS (Unaudited)

Effective April 1, 2014, the Company’s operations were reorganized into four reportable segments: Rig Systems, Rig Aftermarket, Wellbore Technologies and Completion & Production Solutions. Within the four reporting segments, the Company has aggregated two business units under Rig Systems, one business unit under Rig Aftermarket, six business units under Wellbore Technologies and six business units under Completion & Production Solutions for a total of 15 business units. The Company has aggregated each of its business units in one of the four reporting segments based on the guidelines of ASC Topic 280, “Segment Reporting” (“ASC Topic 280”).

Rig Systems

The Company’s Rig Systems segment makes and supports the capital equipment and integrated systems needed to drill oil and gas wells on land and offshore. The segment designs, manufactures, and sells land rigs, offshore drilling equipment packages, including installation and commissioning services, and drilling rig components that mechanize and automate the rig process and functionality.

Equipment and technologies in Rig Systems include: substructures, derricks, and masts; cranes; pipe lifting, racking, rotating, and assembly systems; fluid transfer technologies, such as mud pumps; pressure control equipment, including blowout preventers; power transmission systems, including drives and generators; and rig instrumentation and control systems.

The Rig Systems segment primarily supports land and offshore drillers. Demand for Rig Systems products primarily depends on drilling contractors’ and oil and gas companies’ capital spending plans, specifically capital expenditures on rig construction and refurbishment.

Rig Aftermarket

The Company’s Rig Aftermarket segment provides comprehensive aftermarket products and services to support land rigs and offshore rigs, and drilling rig components manufactured by the Rig Systems segment.

The segment provides spare parts, repair, and rentals as well as technical support, field service and first well support, field engineering, and customer training through a network of aftermarket service and repair facilities strategically located in major areas of drilling operations.

The Rig Aftermarket segment primarily supports land and offshore drillers. Demand for Rig Aftermarket products and services primarily depends on overall levels of oilfield drilling activity, which drives demand for spare parts, service, and repair for Rig System’s large installed base of equipment; and secondarily on drilling contractors’ and oil and gas companies’ capital spending plans, specifically capital expenditures on rig refurbishment and re-certification.

Wellbore Technologies

The Company’s Wellbore Technologies segment designs, manufactures, rents, and sells a variety of equipment and technologies used to perform drilling operations, and offers services that optimize their performance, including: solids control and waste management equipment and services, drilling fluids, premium drill pipe, wired pipe, tubular inspection and coating services, instrumentation, downhole tools, and drill bits.

The Wellbore Technologies segment focuses on oil and gas companies and supports drilling contractors, oilfield service companies, and oilfield rental companies. Demand for Wellbore Technologies products and services primarily depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies.

Completion & Production Solutions

The Company’s Completion & Production Solutions segment integrates technologies for well completions and oil and gas production. The segment designs, manufactures, and sells equipment and technologies needed for hydraulic fracture stimulation, including pressure pumping trucks and pumps, blenders, sanders, hydration units, injection units, flowline, manifolds and wellheads; well intervention, including coiled tubing units, coiled tubing, and wireline units and tools; onshore production, including composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and offshore production, including floating production systems and subsea production technologies.

The Completion & Production Solutions segment primarily supports service companies and oil and gas companies. Demand for Completion & Production Solutions products depends on the level of oilfield completions and workover activity by oilfield service companies and drilling contractors and capital spending plans by oil and gas companies and oilfield service companies.

NATIONAL OILWELL VARCO, INC.

RECAST NEW REPORTING SEGMENTS (Unaudited)

(In millions)

	Three Months Ended			Years Ended December 31,
	March 31, 2014			2013			2012			2011			2010			2009
Revenue:
Rig Systems	$	2,256		$	8,450		$	7,077		$	5,686		$	5,570		$	6,712
Rig Aftermarket		750			2,692			2,138			1,876			1,546			1,518
Wellbore Technologies		1,278			5,211			5,184			4,455			3,389			3,081
Completion & Production Solutions		1,002			4,309			3,994			2,483			1,360			1,304
Eliminations		(397	)		(1,441	)		(1,199	)		(1,025	)		(764	)		(820	)
Total revenue	$	4,889		$	19,221		$	17,194		$	13,475		$	11,101		$	11,795
Operating profit:
Rig Systems	$	451		$	1,594		$	1,685		$	1,562		$	1,629		$	1,876
Rig Aftermarket		191			729			594			528			435			413
Wellbore Technologies		221			915			983			726			377			155
Completion & Production Solutions		137			613			684			456			262			210
Eliminations		(201	)		(652	)		(557	)		(463	)		(340	)		(390	)
Total operating profit	$	799		$	3,199		$	3,389		$	2,809		$	2,363		$	2,264
Operating profit %:
Rig Systems		20.0	%		18.9	%		23.8	%		27.5	%		29.2	%		27.9	%
Rig Aftermarket		25.5	%		27.1	%		27.8	%		28.1	%		28.1	%		27.2	%
Wellbore Technologies		17.3	%		17.6	%		19.0	%		16.3	%		11.1	%		5.0	%
Completion & Production Solutions		13.7	%		14.2	%		17.1	%		18.4	%		19.3	%		16.1	%
Total operating profit %		16.3	%		16.6	%		19.7	%		20.8	%		21.3	%		19.2	%

NATIONAL OILWELL VARCO, INC.

NONRECURRING ITEMS (Unaudited)

(In millions)

	Three Months Ended		Years Ended December 31,
	March 31, 2014		2013			2012		2011		2010		2009
Revenue:
Rig Systems	$	—	$	—		$	—	$	—	$	—	$	—
Rig Aftermarket		—		—			—		—		—		—
Wellbore Technologies		—		(102	)		—		—		—		—
Completion & Production Solutions		—		—			—		—		—		—
Eliminations		—		—			—		—		—		—
Total revenue	$	—	$	(102	)	$	—	$	—	$	—	$	—
Operating profit:
Rig Systems	$	—	$	21		$	—	$	7	$	7	$	—
Rig Aftermarket		—		—			—		—		—		—
Wellbore Technologies		3		(61	)		—		10		—		148
Completion & Production Solutions		6		82			90		24		—		8
Eliminations		9		2			41		—		11		78
Total operating profit	$	18	$	44		$	131	$	41	$	18	$	234

Nonrecurring items primarily include transaction costs and the amortization of backlog and inventory that was stepped up to fair value during purchase accounting, items which are included in operating profit. In addition, included in Wellbore Technologies revenue and operating profit for the year ended December 31, 2013, is a $102 million gain resulting from a legal settlement.

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Three Months Ended			Years Ended December 31,
	March 31, 2014			2013			2012			2011			2010			2009
Revenue excluding nonrecurring items (Note 1):
Rig Systems	$	2,256		$	8,450		$	7,077		$	5,686		$	5,570		$	6,712
Rig Aftermarket		750			2,692			2,138			1,876			1,546			1,518
Wellbore Technologies		1,278			5,109			5,184			4,455			3,389			3,081
Completion & Production Solutions		1,002			4,309			3,994			2,483			1,360			1,304
Eliminations		(397	)		(1,441	)		(1,199	)		(1,025	)		(764	)		(820	)
Total revenue excluding nonrecurring items	$	4,889		$	19,119		$	17,194		$	13,475		$	11,101		$	11,795
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	451		$	1,615		$	1,685		$	1,569		$	1,636		$	1,876
Rig Aftermarket		191			729			594			528			435			413
Wellbore Technologies		224			854			983			736			377			303
Completion & Production Solutions		143			695			774			480			262			218
Eliminations		(192	)		(650	)		(516	)		(463	)		(329	)		(312	)
Total operating profit excluding nonrecurring items	$	817		$	3,243		$	3,520		$	2,850		$	2,381		$	2,498
Operating profit % excluding nonrecurring items (Note 1):
Rig Systems		20.0	%		19.1	%		23.8	%		27.6	%		29.4	%		27.9	%
Rig Aftermarket		25.5	%		27.1	%		27.8	%		28.1	%		28.1	%		27.2	%
Wellbore Technologies		17.5	%		16.7	%		19.0	%		16.5	%		11.1	%		9.8	%
Completion & Production Solutions		14.3	%		16.1	%		19.4	%		19.3	%		19.3	%		16.7	%
Total operating profit % excluding nonrecurring items		16.7	%		17.0	%		20.5	%		21.2	%		21.4	%		21.2	%

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED BEFORE DEPRECIATION & AMORTIZATION SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Three Months Ended			Years Ended December 31,
	March 31, 2014			2013			2012			2011			2010			2009
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	451		$	1,615		$	1,685		$	1,569		$	1,636		$	1,876
Rig Aftermarket		191			729			594			528			435			413
Wellbore Technologies		224			854			983			736			377			303
Completion & Production Solutions		143			695			774			480			262			218
Eliminations		(192	)		(650	)		(516	)		(463	)		(329	)		(312	)
Total operating profit excluding nonrecurring items	$	817		$	3,243		$	3,520		$	2,850		$	2,381		$	2,498
Depreciation & amortization:
Rig Systems	$	22		$	82		$	64		$	61		$	61		$	50
Rig Aftermarket		6			26			18			14			11			10
Wellbore Technologies		108			420			389			381			377			371
Completion & Production Solutions		55			210			145			93			54			53
Eliminations		—			—			—			—			—			—
Total depreciation & amortization	$	191		$	738		$	616		$	549		$	503		$	484
Operating profit as adjusted before depreciation & amortization (Note 1):
Rig Systems	$	473		$	1,697		$	1,749		$	1,630		$	1,697		$	1,926
Rig Aftermarket		197			755			612			542			446			423
Wellbore Technologies		332			1,274			1,372			1,117			754			674
Completion & Production Solutions		198			905			919			573			316			271
Eliminations		(192	)		(650	)		(516	)		(463	)		(329	)		(312	)
Total operating profit as adjusted before depreciation & amortization	$	1,008		$	3,981		$	4,136		$	3,399		$	2,884		$	2,982
Operating profit % as adjusted before depreciation & amortization (Note 1):
Rig Systems		21.0	%		20.1	%		24.7	%		28.7	%		30.5	%		28.7	%
Rig Aftermarket		26.3	%		28.0	%		28.6	%		28.9	%		28.8	%		27.9	%
Wellbore Technologies		26.0	%		24.9	%		26.5	%		25.1	%		22.2	%		21.9	%
Completion & Production Solutions		19.8	%		21.0	%		23.0	%		23.1	%		23.2	%		20.8	%
Total operating profit % as adjusted before depreciation & amortization		20.6	%		20.8	%		24.1	%		25.2	%		26.0	%		25.3	%
Total operating profit as adjusted before depreciation & amortization:	$	1,008		$	3,981		$	4,136		$	3,399		$	2,884		$	2,982
Nonrecurring items		(18	)		(44	)		(131	)		(41	)		(18	)		(234	)
Interest income		4			12			10			18			13			9
Equity income in unconsolidated affiliates		10			63			58			46			36			47
Other income (expense), net		—			(39	)		(68	)		(39	)		(48	)		(110	)
Net income (loss) attributable to noncontrolling interest		—			(1	)		8			9			8			(4	)
EBITDA (Note 1)	$	1,004		$	3,972		$	4,013		$	3,392		$	2,875		$	2,690
Reconciliation of EBITDA (Note 1):
GAAP net income attributable to Company	$	548		$	2,180		$	2,383		$	1,909		$	1,617		$	1,440
Provision for income taxes		239			943			965			894			705			713
Interest expense		26			111			49			40			50			53
Depreciation and amortization		191			738			616			549			503			484
EBITDA		1,004			3,972			4,013			3,392			2,875			2,690
Nonrecurring items		18			53			143			41			45			234
EBITDA excluding nonrecurring items (Note 1)	$	1,022		$	4,025		$	4,156		$	3,433		$	2,920		$	2,924

NATIONAL OILWELL VARCO, INC.

RECAST NEW REPORTING SEGMENTS (Unaudited)

(In millions)

	Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Revenue:
Rig Systems	$	1,911		$	2,081		$	2,061		$	2,397
Rig Aftermarket		551			670			712			759
Wellbore Technologies		1,223			1,222			1,395			1,371
Completion & Production Solutions		1,002			1,057			1,095			1,155
Eliminations		(311	)		(350	)		(400	)		(380	)
Total revenue	$	4,376		$	4,680		$	4,863		$	5,302
Operating profit:
Rig Systems	$	370		$	383		$	388		$	453
Rig Aftermarket		142			189			202			196
Wellbore Technologies		182			184			306			243
Completion & Production Solutions		136			127			175			175
Eliminations		(137	)		(170	)		(187	)		(158	)
Total operating profit	$	693		$	713		$	884		$	909
Operating profit %:
Rig Systems		19.4	%		18.4	%		18.8	%		18.9	%
Rig Aftermarket		25.8	%		28.2	%		28.4	%		25.8	%
Wellbore Technologies		14.9	%		15.1	%		21.9	%		17.7	%
Completion & Production Solutions		13.6	%		12.0	%		16.0	%		15.2	%
Total operating profit %		15.8	%		15.2	%		18.2	%		17.1	%

NATIONAL OILWELL VARCO, INC.

NONRECURRING ITEMS (Unaudited)

(In millions)

	Year Ended December 31, 2013
	First Quarter		Second Quarter		Third Quarter			Fourth Quarter
Revenue:
Rig Systems	$	—	$	—	$	—		$	—
Rig Aftermarket		—		—		—			—
Wellbore Technologies		—		—		(102	)		—
Completion & Production Solutions		—		—		—			—
Eliminations		—		—		—			—
Total revenue	$	—	$	—	$	(102	)	$	—
Operating profit:
Rig Systems	$	2	$	10	$	4		$	5
Rig Aftermarket		—		—		—			—
Wellbore Technologies		26		11		(100	)		2
Completion & Production Solutions		36		36		1			9
Eliminations		—		—		2			—
Total operating profit	$	64	$	57	$	(93	)	$	16

Nonrecurring items primarily include transaction costs and the amortization of backlog and inventory that was stepped up to fair value during purchase accounting, items which are included in operating profit. In addition, included in Wellbore Technologies revenue and operating profit for the three months ended September 30, 2013, is a $102 million gain resulting from a legal settlement.

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Revenue excluding nonrecurring items (Note 1):
Rig Systems	$	1,911		$	2,081		$	2,061		$	2,397
Rig Aftermarket		551			670			712			759
Wellbore Technologies		1,223			1,222			1,293			1,371
Completion & Production Solutions		1,002			1,057			1,095			1,155
Eliminations		(311	)		(350	)		(400	)		(380	)
Total revenue excluding nonrecurring items	$	4,376		$	4,680		$	4,761		$	5,302
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	372		$	393		$	392		$	458
Rig Aftermarket		142			189			202			196
Wellbore Technologies		208			195			206			245
Completion & Production Solutions		172			163			176			184
Eliminations		(137	)		(170	)		(185	)		(158	)
Total operating profit excluding nonrecurring items	$	757		$	770		$	791		$	925
Operating profit % excluding nonrecurring items (Note 1):
Rig Systems		19.5	%		18.9	%		19.0	%		19.1	%
Rig Aftermarket		25.8	%		28.2	%		28.4	%		25.8	%
Wellbore Technologies		17.0	%		16.0	%		15.9	%		17.9	%
Completion & Production Solutions		17.2	%		15.4	%		16.1	%		15.9	%
Total operating profit % excluding nonrecurring items		17.3	%		16.5	%		16.6	%		17.4	%

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED BEFORE DEPRECIATION & AMORTIZATION SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	372		$	393		$	392		$	458
Rig Aftermarket		142			189			202			196
Wellbore Technologies		208			195			206			245
Completion & Production Solutions		172			163			176			184
Eliminations		(137	)		(170	)		(185	)		(158	)
Total operating profit excluding nonrecurring items	$	757		$	770		$	791		$	925
Depreciation & amortization:
Rig Systems	$	16		$	22		$	19		$	25
Rig Aftermarket		6			6			6			8
Wellbore Technologies		101			101			111			108
Completion & Production Solutions		47			57			51			54
Eliminations		—			—			—			—
Total depreciation & amortization	$	170		$	186		$	187		$	195
Operating profit as adjusted before depreciation & amortization (Note 1):
Rig Systems	$	388		$	415		$	411		$	483
Rig Aftermarket		148			195			208			204
Wellbore Technologies		309			296			317			353
Completion & Production Solutions		219			220			227			238
Eliminations		(137	)		(170	)		(185	)		(158	)
Total operating profit as adjusted before depreciation & amortization	$	927		$	956		$	978		$	1,120
Operating profit % as adjusted before depreciation & amortization (Note 1):
Rig Systems		20.3	%		19.9	%		19.9	%		20.2	%
Rig Aftermarket		26.9	%		29.1	%		29.2	%		26.9	%
Wellbore Technologies		25.3	%		24.2	%		24.5	%		25.7	%
Completion & Production Solutions		21.9	%		20.8	%		20.7	%		20.6	%
Total operating profit % as adjusted before depreciation & amortization		21.2	%		20.4	%		20.5	%		21.1	%
Total operating profit as adjusted before depreciation & amortization:	$	927		$	956		$	978		$	1,120
Nonrecurring items		(64	)		(57	)		93			(16	)
Interest income		3			3			2			4
Equity income in unconsolidated affiliates		19			15			13			16
Other income (expense), net		(23	)		11			(12	)		(15	)
Net income (loss) attributable to noncontrolling interest		2			—			—			(3	)
EBITDA (Note 1)	$	864		$	928		$	1,074		$	1,106
Reconciliation of EBITDA (Note 1):
GAAP net income attributable to Company	$	461		$	494		$	598		$	627
Provision for income taxes		205			218			263			257
Interest expense		28			30			26			27
Depreciation and amortization		170			186			187			195
EBITDA		864			928			1,074			1,106
Nonrecurring items		72			57			(92	)		16
EBITDA excluding nonrecurring items (Note 1)	$	936		$	985		$	982		$	1,122

NATIONAL OILWELL VARCO, INC.

RECAST NEW REPORTING SEGMENTS (Unaudited)

(In millions)

	Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Revenue:
Rig Systems	$	1,633		$	1,611		$	1,741		$	2,092
Rig Aftermarket		393			660			533			552
Wellbore Technologies		1,279			1,326			1,273			1,306
Completion & Production Solutions		728			948			963			1,355
Eliminations		(65	)		(339	)		(203	)		(592	)
Total revenue	$	3,968		$	4,206		$	4,307		$	4,713
Operating profit:
Rig Systems	$	376		$	376		$	404		$	529
Rig Aftermarket		112			194			159			129
Wellbore Technologies		256			257			229			241
Completion & Production Solutions		137			155			140			252
Eliminations		(41	)		(143	)		(79	)		(294	)
Total operating profit	$	840		$	839		$	853		$	857
Operating profit %:
Rig Systems		23.0	%		23.3	%		23.2	%		25.3	%
Rig Aftermarket		28.5	%		29.4	%		29.8	%		23.4	%
Wellbore Technologies		20.0	%		19.4	%		18.0	%		18.5	%
Completion & Production Solutions		18.8	%		16.4	%		14.5	%		18.6	%
Total operating profit %		21.2	%		19.9	%		19.8	%		18.2	%

NATIONAL OILWELL VARCO, INC.

NONRECURRING ITEMS (Unaudited)

(In millions)

	Year Ended December 31, 2012
	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
Revenue:
Rig Systems	$	—	$	—	$	—	$	—
Rig Aftermarket		—		—		—		—
Wellbore Technologies		—		—		—		—
Completion & Production Solutions		—		—		—		—
Eliminations		—		—		—		—
Total revenue	$	—	$	—	$	—	$	—
Operating profit:
Rig Systems	$	—	$	—	$	—	$	—
Rig Aftermarket		—		—		—		—
Wellbore Technologies		—		—		—		—
Completion & Production Solutions		4		21		22		43
Eliminations		—		7		26		8
Total operating profit	$	4	$	28	$	48	$	51

Nonrecurring items primarily include transaction costs and the amortization of backlog and inventory that was stepped up to fair value during purchase accounting, items which are included in operating profit.

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Revenue excluding nonrecurring items (Note 1):
Rig Systems	$	1,633		$	1,611		$	1,741		$	2,092
Rig Aftermarket		393			660			533			552
Wellbore Technologies		1,279			1,326			1,273			1,306
Completion & Production Solutions		728			948			963			1,355
Eliminations		(65	)		(339	)		(203	)		(592	)
Total revenue excluding nonrecurring items	$	3,968		$	4,206		$	4,307		$	4,713
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	376		$	376		$	404		$	529
Rig Aftermarket		112			194			159			129
Wellbore Technologies		256			257			229			241
Completion & Production Solutions		141			176			162			295
Eliminations		(41	)		(136	)		(53	)		(286	)
Total operating profit excluding nonrecurring items	$	844		$	867		$	901		$	908
Operating profit % excluding nonrecurring items (Note 1):
Rig Systems		23.0	%		23.3	%		23.2	%		25.3	%
Rig Aftermarket		28.5	%		29.4	%		29.8	%		23.4	%
Wellbore Technologies		20.0	%		19.4	%		18.0	%		18.5	%
Completion & Production Solutions		19.4	%		18.6	%		16.8	%		21.8	%
Total operating profit % excluding nonrecurring items		21.3	%		20.6	%		20.9	%		19.3	%

NATIONAL OILWELL VARCO, INC.

AS ADJUSTED BEFORE DEPRECIATION & AMORTIZATION SUPPLEMENTAL SCHEDULE (Unaudited)

(In millions)

	Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Operating profit excluding nonrecurring items (Note 1):
Rig Systems	$	376		$	376		$	404		$	529
Rig Aftermarket		112			194			159			129
Wellbore Technologies		256			257			229			241
Completion & Production Solutions		141			176			162			295
Eliminations		(41	)		(136	)		(53	)		(286	)
Total operating profit excluding nonrecurring items	$	844		$	867		$	901		$	908
Depreciation & amortization:
Rig Systems	$	15		$	16		$	15		$	18
Rig Aftermarket		4			4			5			5
Wellbore Technologies		94			98			98			99
Completion & Production Solutions		32			37			35			41
Eliminations		—			—			—			—
Total depreciation & amortization	$	145		$	155		$	153		$	163
Operating profit as adjusted before depreciation & amortization (Note 1):
Rig Systems	$	391		$	392		$	419		$	547
Rig Aftermarket		116			198			164			134
Wellbore Technologies		350			355			327			340
Completion & Production Solutions		173			213			197			336
Eliminations		(41	)		(136	)		(53	)		(286	)
Total operating profit as adjusted before depreciation & amortization	$	989		$	1,022		$	1,054		$	1,071
Operating profit % as adjusted before depreciation & amortization (Note 1):
Rig Systems		23.9	%		24.3	%		24.1	%		26.1	%
Rig Aftermarket		29.5	%		30.0	%		30.8	%		24.3	%
Wellbore Technologies		27.4	%		26.8	%		25.7	%		26.0	%
Completion & Production Solutions		23.8	%		22.5	%		20.5	%		24.8	%
Total operating profit % as adjusted before depreciation & amortization		24.9	%		24.3	%		24.5	%		22.7	%
Total operating profit as adjusted before depreciation & amortization:	$	989		$	1,022		$	1,054		$	1,071
Nonrecurring items		(4	)		(28	)		(48	)		(51	)
Interest income		3			3			2			2
Equity income in unconsolidated affiliates		17			19			7			15
Other income (expense), net		(14	)		(5	)		(20	)		(29	)
Net income (loss) attributable to noncontrolling interest		2			3			3			—
EBITDA (Note 1)	$	993		$	1,014		$	998		$	1,008
Reconciliation of EBITDA (Note 1):
GAAP net income attributable to Company	$	583		$	579		$	584		$	637
Provision for income taxes		257			271			250			187
Interest expense		8			9			11			21
Depreciation and amortization		145			155			153			163
EBITDA		993			1,014			998			1,008
Nonrecurring items		7			28			57			51
EBITDA excluding nonrecurring items (Note 1)	$	1,000		$	1,042		$	1,055		$	1,059

NATIONAL OILWELL VARCO, INC.

BACKLOG (Unaudited)

(In millions)

	Beginning Backlog		Backlog Orders		Revenue out of Backlog		Ending Backlog
Rig Systems
Years Ended:
2009	$	10,834	$	1,499	$	6,089	$	6,244
2010		6,244		3,106		4,928		4,422
2011		4,422		9,670		4,869		9,223
2012		9,223		7,829		6,176		10,876
2013		10,876		11,537		7,385		15,028
Quarters Ended:
March 31, 2013	$	10,876	$	2,759	$	1,666	$	11,969
June 30, 2013		11,969		2,705		1,819		12,855
September 30, 2013		12,855		2,978		1,772		14,061
December 31, 2013		14,061		3,095		2,128		15,028
March 31, 2014		15,028		2,116		1,964		15,180
Completion & Production Solutions
Years Ended:
2009	$	415	$	456	$	632	$	239
2010		239		1,216		629		826
2011		826		1,775		1,283		1,318
2012		1,318		2,214		2,188		1,344
2013		1,344		2,673		2,383		1,634
Quarters Ended:
March 31, 2013	$	1,344	$	600	$	593	$	1,351
June 30, 2013		1,351		738		597		1,492
September 30, 2013		1,492		557		552		1,497
December 31, 2013		1,497		778		641		1,634
March 31, 2014		1,634		485		492		1,627

The Company monitors its backlog of orders within its Rig Systems and Completion & Production Solutions segments to guide its planning. Backlog includes orders which typically require more than three months to manufacture and deliver.

Backlog measurements are made on the basis of written orders which are firm, but may be defaulted upon by the customer in some instances. Most require reimbursement to the Company for costs incurred in such an event. There can be no assurance that the backlog amounts will ultimately be realized as revenue, or that the Company will earn a profit on backlog work.

NATIONAL OILWELL VARCO, INC.

NOTES TO FORM 8-K (Unaudited)

Note 1: In an effort to provide investors with additional information regarding our results as determined by GAAP, we disclose various non-GAAP financial measures in our quarterly earnings press releases and other public disclosures. The primary non-GAAP financial measures we focus on are: (i) revenue excluding nonrecurring items, (ii) operating profit excluding nonrecurring items, (iii) operating profit percentage excluding nonrecurring items, (iv) operating profit excluding nonrecurring items before depreciation & amortization, (v) operating profit percentage excluding nonrecurring items before depreciation & amortization and (vi) EBITDA. Each of these financial measures excludes the impact of certain other costs and therefore has not been calculated in accordance with GAAP. A reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure is included here within.

We use these non-GAAP financial measures internally to evaluate and manage the Company’s operations because we believe it provides useful supplemental information regarding the Company’s on-going economic performance. We have chosen to provide this information to investors to enable them to perform more meaningful comparisons of operating results and as a means to emphasize the results of on-going operations.