UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): January 28, 2005
HALLIBURTON COMPANY
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-3492 | No. 75-2677995 |
(Commission File Number) | (IRS Employer Identification No.) |
1401 McKinney, Suite 2400, Houston, Texas | 77010 |
(Address of Principal Executive Offices) | (Zip Code) |
(713) 759-2600
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (seeGeneral Instruction A.2. below):
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
INFORMATION TO BE INCLUDED IN REPORT
ITEM 2.02 Results of Operations and Financial Condition
On January 28, 2005 registrant issued a press release entitled “Halliburton Announces Fourth Quarter Results.”
The text of the Press Release is as follows:
HALLIBURTON ANNOUNCES FOURTH QUARTER RESULTS
Asbestos settlement completed and record quarterly revenue for ESG
HOUSTON, Texas - Halliburton (NYSE:HAL) announced today that fourth quarter 2004 income from continuing operations was $183 million, or $0.41 per diluted share.
Net loss for the quarter was $201 million, or $0.45 per diluted share, and included a loss from discontinued operations of $384 million, or $0.86 per diluted share. The loss from discontinued operations resulted primarily from the fourth quarter revaluation charge arising from the increase in the value of the 59.5 million shares of Halliburton common stock that have subsequently been contributed to the trust for the benefit of asbestos claimants.
Consolidated revenue was $5.2 billion in the fourth quarter 2004, down 5% from the fourth quarter 2003. This decrease was largely attributable to lower activity on government services projects in the Middle East in KBR, and was partially offset by record quarterly revenue in the Energy Services Group (ESG).
Consolidated operating income was $349 million in the fourth quarter 2004 compared to $303 million in the fourth quarter 2003. Impacting fourth quarter 2004 operating income was a $33 million loss for two integrated solutions projects in southern Mexico, a $22 million charge, as previously announced, related to the restructuring of KBR, a $14 million gain related to the sale of ESG’s surface well testing (SWT) operations, and an $11 million charge for an intellectual property settlement related to the sale of Subsea 7.
“The fourth quarter was a busy and important one for the future of Halliburton,” said Dave Lesar, chairman, president and chief executive officer of Halliburton. “We ended our asbestos exposure. We completed the restructuring of KBR into two business segments, and achieved significant milestones on each of our three remaining offshore lump sum construction contracts, which significantly reduces our risk exposure on these projects. Our ESG operation had a record quarter for revenue and the highest fourth quarter margin ever. We achieved a 17.1% margin, even after recording the charges for the integrated solutions projects, the intellectual property settlement, and the gain on sale of SWT, which in aggregate decreased the margin by 1.4 percentage points.
For the year 2004, we established new records in revenue and operating income for three of the four ESG segments. For the fourth quarter, the total ESG group achieved record revenue that was driven by our Production Optimization and Drilling and Formation Evaluation segments. We were especially pleased to see fourth quarter revenue grow by three percent over the third quarter, which historically has been our highest quarter of the year. This supports our view that prices and demand for our services continue to increase. Our customers are expected to continue to increase their spending, which will allow for a strong market for our services to continue through 2005 and beyond. We also believe that KBR is now positioned for profitability.”
2004 Fourth Quarter Segment Results
Energy Services Group
ESG posted fourth quarter 2004 revenue of $2.2 billion, a $371 million or 21% increase over the fourth quarter 2003, and operating income of $370 million, up $129 million or 54% from the same period in the prior year.
Production Optimization operating income for the fourth quarter 2004 was $209 million, an increase of $94 million, including an additional gain of $14 million in the fourth quarter 2004 on the sale of the SWT operations. A portion of the gain on the sale of SWT operations had not been recognized in the third quarter as a result of ESG’s continuing involvement with portions of the operations in certain countries. Production enhancement services improved operating income by $54 million, driven by increased land rig activity, higher equipment utilization, and improved pricing in the United States. WellDynamics posted record revenue and operating income in the quarter with significant sales of its SmartWell® intelligent completion technology in the Middle East. Equity income from Subsea 7 increased $20 mil lion, as fourth quarter 2003 was negatively impacted by project losses and lower vessel utilization.
Fluids operating income for the fourth quarter 2004 was $102 million, a $29 million or 40% increase over the fourth quarter 2003. This increase was partially attributable to a $19 million increase in cementing services operating income primarily due to higher land drilling activity and improved pricing in the United States marketplace. Drilling fluids services operating income increased $11 million on strong United States land activity and improved results in Western Europe.
Drilling and Formation Evaluation operating income of $59 million was up $42 million over the prior year fourth quarter. This increase was primarily due to increased activity in the North Sea, Asia Pacific, and United States land; and cost reductions in the Gulf of Mexico. Also contributing to the improved operating income were decreased costs of $6 million from the 2003 drill bit plant consolidation. Drilling services benefited from lower depreciation expense in the fourth quarter 2004, compared to fourth quarter 2003 due to extending the useful life of drilling tools in the second quarter 2004.
Digital and Consulting Solutions, formerly Landmark and Other Energy Services, operating income for the fourth quarter 2004 was breakeven, compared to $36 millionoperating income in the fourth quarter 2003. Landmark Graphics achieved recordrevenue and operating income for the quarter. Revenue grew 16% and operating income was up 19% over the prior year. The fourth quarter 2004 results included a $33 million charge for two integrated solutions projects in southern Mexico. The fixed price contracts were awarded to the Company in the second quarter of 2004 and involve drilling 33 turnkey wells over a two year period. The charge reflects the estimated total project loss through completion that resulted from higher start-up expenses, increased costs to complete the projects, and longer drilling times than originally anticipated. Segment results also included an $11 million charge for an intellectual property settlement. This settlement was necessary to complete the sale of Subsea 7 in January 2005.
KBR
KBR revenue for the fourth quarter 2004 was $3.0 billion, a 17% decrease compared to fourth quarter 2003. The decrease was due to reduced government contract activities, primarily in the Middle East and project completions in the Energy and Chemicals segment.
KBR operating income for the fourth quarter 2004 was breakeven, compared to operating income of $82 million in the fourth quarter 2003. During the fourth quarter of 2004, a total charge of $22 million was recorded as a result of restructuring KBR into two segments: Energy and Chemicals, and Government and Infrastructure. When the restructuring plan for KBR was announced in September, the annual savings from the plan were projected to be between $80 million and $100 million. As of today, the estimated annual savings from the restructuring plan are expected to meet or exceed the upper end of this range in 2005.
Energy and Chemicals operating loss was $9 million in the fourth quarter 2004, compared to $15 million operating income in the fourth quarter 2003. Included in fourth quarter 2004 results was a $14 million restructuring charge. The fourth quarter 2004 results were also negatively impacted by charges totaling $21 million for additional costs on offshore hookup of the Belanak FPSO project and a settlement on a completed mining project in the United States.
Government and Infrastructure operating income was $9 million in the fourth quarter 2004 compared to $69 million operating income in the fourth quarter 2003. Included in fourth quarter 2004 results was an $8 million restructuring charge. Operating income from Iraq activities was $20 million lower than the fourth quarter 2003, primarily due to completion of the RIO contract. The decrease in operating income reflected a loss on a construction project in Afghanistan in the fourth quarter 2004 and the completion of a railway project in Australia in 2003, and was partially offset by improved results at the DML shipyard in the United Kingdom.
KBR backlog at December 31, 2004 was $8.4 billion, down approximately $900 millionfrom September 30, 2004. Approximately 25% of the backlog is for fixed-fee contracts. Of the total backlog, $3.6 billion is for Energy and Chemicals projects and $4.8 billion isfor Government and Infrastructure projects.
Halliburton’s Iraq-related work contributed approximately $1.7 billion in revenue in thefourth quarter 2004 and $13 million of operating income, or a 0.8% margin.
Technology and Significant Achievements
Halliburton had a number of advances in technology and new contract awards.
Energy Services Group new technologies and contracts:
| · | Halliburton’s DepthStar® received the Outstanding Technology award from the European Institute, the only award given to an oilfield service company, adding to its earlier awards from the Society of Petroleum Engineers (SPE) and American Society of Mechanical Engineers (ASME). In 2004, Halliburton received 12 first place and 5 runner-up awards from Hart’s E&P, World Oil, the European Institute, SPE and ASME, more than any other oilfield service company. |
| · | Landmark Graphics and Silicon Graphics have demonstrated breakthrough technology with the use of advanced interactive visualization on a 400GB seismic dataset in association with Marathon Oil Company. This new practical science solution enables exploration of the Earth's subsurface using seismic information that contains four times more information than current technologies. |
| · | Halliburton received a three-year contract for well completions in Qatar’s giant North Gas field awarded by Dolphin Energy Limited to Halliburton’s Production Optimization segment. The reliability and performance of Halliburton’s Peak® large monobore downhole completion equipment is a critical component to the success of the high-rate gas well completions required in this project. |
| · | Halliburton’s Drilling and Formation Evaluation segment was awarded a three- year contract for Directional Drilling and measurement/logging-while-drilling (M/LWD) work in the United Kingdom sector of the North Sea. The contract will include services such as the Geo-Pilot® rotary steerable system, the Stellar® suite of M/LWD services and the INSITE® information management system to link the operational center with the main hub, allowing for real-time drilling decisions. Services will start in the first quarter 2005. |
| · | Halliburton’s Drilling and Formation Evaluation (DFE) segment was awarded a four-year contract in Brunei. The award is for the use of the Geo-Pilot® rotary steerable system and the Stellar® suite of LWD services. In addition to these services, DFE will provide its Sperry-Sun ADT® drilling optimization service. |
KBR new contract awards:
| · | KBR and its joint venture partners have been issued a Letter of Authorization to perform pre-FEED work for the Gorgon Downstream liquefied natural gas (LNG) |
project. The project is a grassroots LNG facility to be located on Barrow Island in Western Australia.
| · | KBR has been awarded a contract by Fangyuan Chemical Industry Development Co., Ltd. of the Tianji Group to provide a process technology license and a basic engineering package for a 450 metric ton/day aniline plant located in Lucheng, Shanxi, China. |
| · | KBR has been awarded licenses for advanced reaction system technology as well as basic engineering design packages for Repsol YPF's Fluid Catalytic Cracking Units in its La Plata and Lujan de Cuyo refineries in Argentina. |
| · | KBR has been awarded a license for a second catalyst cooler for Petrobras' Residual Fluid Catalytic Cracking (FCC) Unit in its Capuava (RECAP) refinery located in Sao Paulo, Brazil. The catalyst cooler installations provide Petrobras the flexibility to process more contaminated, lower cost atmospheric residue feedstocks in their newest FCC units. Petrobras previously licensed the same technology from KBR for six catalyst coolers at three refinery locations in Brazil. |
Halliburton, founded in 1919, is one of the world’s largest providers of products and services to the petroleum and energy industries. The company serves its customers with a broad range of products and services through its Energy Services and Engineering and Construction Groups. The company’s World Wide Web site can be accessed atwww.halliburton.com.
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: legal risks, including the risks of audits and investigations of the company by domestic and foreign government agencies and legislative bodies and potential adverse proceedings and findings by such agencies, a delay in the receipt of additional agreed payments from insurers arising from asbestos and silica clai ms, the risks of judgments against the company and its subsidiaries in litigation and proceedings, including shareholder lawsuits, securities laws inquiries, contract disputes, patent infringements and environmental matters, legislation, changes in government regulations and adverse reaction to scrutiny involving the company; political risks, including the risks of unsettled political conditions, war and the effects of terrorism, foreign operations and foreign exchange rates and controls; liquidity risks, including the risks of potential reductions in debt ratings, access to credit, availability and costs of financing and ability to raise capital; weather-related risks; customer risks, including the risks of changes in capital spending and claims negotiations; industry risks, including the risks of changes that affect the demand for or price of oil and/or gas, structural changes in the industries in which the company operates, risks of fixed-fee projects and risks ofcomplex business arrangements; systems risks, including the risks of successful development and installation of financial systems; and personnel and merger/reorganization/disposition risks, including the risks of increased competition for employees, successful integration of acquired businesses, effective restructuring efforts and successful completion of planned dispositions. Please see Halliburton's Form 10-K/A for the year ended December 31, 2003 and Form 10-Q for the quarter ended September 30, 2004 for a more complete discussion of such risk factors.
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
| Three Months | Three Months | |||||||||
| Ended | Ended | |||||||||
| December 31 | September 30 | |||||||||
2004 | 2003 | 2004 | ||||||||
Revenue | ||||||||||
| Production Optimization | $ | 912 | $ | 713 | $ | 886 | ||||
| Fluids | 617 | 531 | 618 | |||||||
| Drilling and Formation Evaluation | 465 | 417 | 450 | |||||||
| Digital and Consulting Solutions | 176 | 138 | 154 | |||||||
Total Energy Services Group | 2,170 | 1,799 | 2,108 | |||||||
| Government and Infrastructure | 2,295 | 2,691 | 1,993 | |||||||
| Energy and Chemicals | 736 | 974 | 689 | |||||||
Total Engineering and Construction Group | 3,031 | 3,665 | 2,682 | |||||||
Total revenue | $ | 5,201 | $ | 5,464 | $ | 4,790 | ||||
Operating income (loss) | ||||||||||
| Production Optimization | $ | 209 | $ | 115 | $ | 222 | ||||
| Fluids | 102 | 73 | 113 | |||||||
| Drilling and Formation Evaluation | 59 | 17 | 62 | |||||||
| Digital and Consulting Solutions | - | 36 | 17 | |||||||
Total Energy Services Group | 370 | 241 | 414 | |||||||
| Government and Infrastructure | 9 | 69 | (6 | ) | ||||||
| Energy and Chemicals | (9 | ) | 15 | (44 | ) | |||||
| Asbestos and silica | - | (2 | ) | - | ||||||
Total Engineering and Construction Group | - | 82 | (50 | ) | ||||||
| General corporate | (21 | ) | (20 | ) | (22 | ) | ||||
Total operating income | 349 | 303 | 342 | |||||||
| Interest expense | (69 | ) | (54 | ) | (51 | ) | ||||
| Interest income | 14 | 8 | 13 | |||||||
| Foreign currency, net | 6 | 4 | 1 | |||||||
| Other, net | - | (1 | ) | (2 | ) | |||||
| Income from continuing operations before income taxes | ||||||||||
and minority interest | 300 | 260 | 303 | |||||||
| Provision for income taxes | (111 | ) | (92 | ) | (111 | ) | ||||
| Minority interest in net income of subsidiaries | (6 | ) | (22 | ) | (6 | ) | ||||
| Income from continuing operations | 183 | 146 | 186 | |||||||
| Loss from discontinued operations, net | (384 | ) | (1,093 | ) | (230 | ) | ||||
Net loss | $ | (201 | ) | $ | (947 | ) | $ | (44 | ) | |
Basic income (loss) per share: | ||||||||||
| Income from continuing operations | $ | 0.42 | $ | 0.34 | $ | 0.43 | ||||
| Loss from discontinued operations, net | (0.88 | ) | (2.52 | ) | (0.54 | ) | ||||
Net loss | $ | (0.46 | ) | $ | (2.18 | ) | $ | (0.11 | ) | |
Diluted income (loss) per share: | ||||||||||
| Income from continuing operations | $ | 0.41 | $ | 0.34 | $ | 0.42 | ||||
| Loss from discontinued operations, net | (0.86 | ) | (2.51 | ) | (0.51 | ) | ||||
Net loss | $ | (0.45 | ) | $ | (2.17 | ) | $ | (0.09 | ) | |
| Basic weighted average common shares outstanding | 439 | 435 | 438 | |||||||
| Diluted weighted average common shares outstanding | 444 | 438 | 442 | |||||||
See Footnote Table 1 for a list of significant items included in operating income.
HALLIBURTON COMPANY
Condensed Consolidated Statements of Operations
(Millions of dollars and shares except per share data)
(Unaudited)
| Twelve Months Ended | |||||||
| December 31 | |||||||
2004 | 2003 | ||||||
Revenue | |||||||
| Production Optimization | $ | 3,303 | $ | 2,758 | |||
| Fluids | 2,324 | 2,039 | |||||
| Drilling and Formation Evaluation | 1,782 | 1,643 | |||||
| Digital and Consulting Solutions | 589 | 555 | |||||
Total Energy Services Group | 7,998 | 6,995 | |||||
| Government and Infrastructure | 9,393 | 5,417 | |||||
| Energy and Chemicals | 3,075 | 3,859 | |||||
Total Engineering and Construction Group | 12,468 | 9,276 | |||||
Total revenue | $ | 20,466 | $ | 16,271 | |||
Operating income (loss) | |||||||
| Production Optimization | $ | 634 | $ | 413 | |||
| Fluids | 352 | 251 | |||||
| Drilling and Formation Evaluation | 223 | 177 | |||||
| Digital and Consulting Solutions | 60 | (15 | ) | ||||
Total Energy Services Group | 1,269 | 826 | |||||
| Government and Infrastructure | 84 | 194 | |||||
| Energy and Chemicals | (426 | ) | (225 | ) | |||
| Asbestos and silica | - | (5 | ) | ||||
Total Engineering and Construction Group | (342 | ) | (36 | ) | |||
| General corporate | (87 | ) | (70 | ) | |||
Total operating income | 840 | 720 | |||||
| Interest expense | (229 | ) | (139 | ) | |||
| Interest income | 44 | 30 | |||||
| Foreign currency, net | (3 | ) | - | ||||
| Other, net | 2 | 1 | |||||
| Income from continuing operations before income taxes, | |||||||
minority interest and change in accounting principle | 654 | 612 | |||||
| Provision for income taxes | (242 | ) | (234 | ) | |||
| Minority interest in net income of subsidiaries | (25 | ) | (39 | ) | |||
| Income from continuing operations before change in | |||||||
accounting principle | 387 | 339 | |||||
| Loss from discontinued operations, net | (1,364 | ) | (1,151 | ) | |||
| Cumulative effect of change in accounting principle, net | - | (8 | ) | ||||
Net loss | $ | (977 | ) | $ | (820 | ) | |
Basic income (loss) per share: | |||||||
| Income from continuing operations before change in | |||||||
accounting principle | $ | 0.89 | $ | 0.78 | |||
| Loss from discontinued operations, net | (3.13 | ) | (2.65 | ) | |||
| Cumulative effect of change in accounting principle, net | - | (0.02 | ) | ||||
Net loss | $ | (2.24 | ) | $ | (1.89 | ) | |
Diluted income (loss) per share: | |||||||
| Income from continuing operations before change in | |||||||
accounting principle | $ | 0.88 | $ | 0.78 | |||
| Loss from discontinued operations, net | (3.09 | ) | (2.64 | ) | |||
| Cumulative effect of change in accounting principle, net | - | (0.02 | ) | ||||
Net loss | $ | (2.21 | ) | $ | (1.88 | ) | |
| Basic weighted average common shares outstanding | 437 | 434 | |||||
| Diluted weighted average common shares outstanding | 441 | 437 | |||||
See Footnote Table 1 for a list of significant items included in operating income.
HALLIBURTON COMPANY
Condensed Consolidated Balance Sheets
(Millions of dollars)
(Unaudited)
| December 31 | September 30 | |||||||||
2004 | 2003 | 2004 | ||||||||
Assets | ||||||||||
Current assets: | ||||||||||
| Cash and equivalents | $ | 2,808 | $ | 1,815 | $ | 2,996 | ||||
| Receivables, net | 4,675 | 4,669 | 4,454 | |||||||
Insurance for asbestos- and silica-related liabilities(1) | 1,066 | 96 | 965 | |||||||
| Inventories, net | 723 | 695 | 741 | |||||||
| Other current assets | 684 | 644 | 667 | |||||||
Total current assets | 9,956 | 7,919 | 9,823 | |||||||
| Property, plant, and equipment, net | 2,566 | 2,526 | 2,540 | |||||||
Insurance for asbestos- and silica-related liabilities(1) | 350 | 2,038 | 488 | |||||||
| Other assets | 2,926 | 3,016 | 3,107 | |||||||
Total assets | $ | 15,798 | $ | 15,499 | $ | 15,958 | ||||
Liabilities and Shareholders’ Equity | ||||||||||
Current liabilities: | ||||||||||
| Asbestos- and silica-related liabilities | $ | 2,408 | $ | 2,507 | $ | 2,415 | ||||
| Accounts payable | 2,271 | 1,776 | 2,362 | |||||||
| Current maturities of long-term debt | 347 | 22 | 50 | |||||||
| Other current liabilities | 2,038 | 2,259 | 2,228 | |||||||
Total current liabilities | 7,064 | 6,564 | 7,055 | |||||||
| Long-term debt | 3,593 | 3,415 | 3,894 | |||||||
Asbestos- and silica-related liabilities(2) | 37 | 1,579 | 2,029 | |||||||
| Other liabilities | 1,062 | 1,294 | 1,188 | |||||||
Total liabilities | 11,756 | 12,852 | 14,166 | |||||||
| Minority interest in consolidated subsidiaries | 108 | 100 | 113 | |||||||
Shareholders’ equity(2) | 3,934 | 2,547 | 1,679 | |||||||
Total liabilities and shareholders’ equity | $ | 15,798 | $ | 15,499 | $ | 15,958 | ||||
(1)The change in “Insurance for asbestos- and silica-related liabilities” from December 31, 2003 reflects the reclassifications from noncurrent to current based on the amount of cash we expect to receive from insurance carriers within a year; and a $680 million write-down in the second quarter of 2004 resulting from settlement agreements with insurance carriers.
(2)The decrease in “Asbestos- and silica-related liabilities” and the increase in “Shareholders’ equity” reflect the reclassification of the 59.5 million shares of Halliburton common stock to be contributed to trusts for the benefit of asbestos and silica claimants upon the December 31, 2004 final and nonappealable confirmation of our plan of reorganization. The value of the shares was increased by $342 million on December 31, 2004, based on the closing price of $39.24 on that day, resulting in a total reclassification of $2.335 billion to shareholders’ equity. &nbs p;
HALLIBURTON COMPANY
Revenue and Operating Income Comparison
By Operating Segments - Engineering and Construction Group Only
(Millions of dollars)
(Unaudited)
| Twelve Months | ||||||||||||||||
| Three Months Ended | Ended | |||||||||||||||
2004 | March 31 | June 30 | September 30 | December 31 | December 31 | |||||||||||
Revenue: | ||||||||||||||||
| Government and Infrastructure | $ | 2,868 | $ | 2,237 | $ | 1,993 | $ | 2,295 | $ | 9,393 | ||||||
| Energy and Chemicals | 835 | 815 | 689 | 736 | 3,075 | |||||||||||
| Total Engineering and Construction | ||||||||||||||||
Group revenue | $ | 3,703 | $ | 3,052 | $ | 2,682 | $ | 3,031 | $ | 12,468 | ||||||
Operating income (loss): | ||||||||||||||||
| Government and Infrastructure | $ | 62 | $ | 19 | $ | (6 | ) | $ | 9 | $ | 84 | |||||
| Energy and Chemicals | (77 | ) | (296 | ) | (44 | ) | (9 | ) | (426 | ) | ||||||
| Total Engineering and Construction | ||||||||||||||||
Group operating loss | $ | (15 | ) | $ | (277 | ) | $ | (50 | ) | $ | - | $ | (342 | ) | ||
| Twelve Months | ||||||||||||||||
| Three Months Ended | Ended | |||||||||||||||
2003 | March 31 | June 30 | September 30 | December 31 | December 31 | |||||||||||
Revenue: | ||||||||||||||||
| Government and Infrastructure | $ | 518 | $ | 780 | $ | 1,428 | $ | 2,691 | $ | 5,417 | ||||||
| Energy and Chemicals | 931 | 1,039 | 915 | 974 | 3,859 | |||||||||||
| Total Engineering and Construction | ||||||||||||||||
Group revenue | $ | 1,449 | $ | 1,819 | $ | 2,343 | $ | 3,665 | $ | 9,276 | ||||||
Operating income (loss): | ||||||||||||||||
| Government and Infrastructure | $ | 26 | $ | 33 | $ | 66 | $ | 69 | $ | 194 | ||||||
| Energy and Chemicals | (43 | ) | (181 | ) | (16 | ) | 15 | (225 | ) | |||||||
| Asbestos and silica | (2 | ) | - | (1 | ) | (2 | ) | (5 | ) | |||||||
| Total Engineering and Construction | ||||||||||||||||
Group operating income (loss) | $ | (19 | ) | $ | (148 | ) | $ | 49 | $ | 82 | $ | (36 | ) | |||
HALLIBURTON COMPANY
Revenue and Operating Income Comparison
By Geographic Region - Energy Services Group Only
(Millions of dollars)
(Unaudited)
| Three Months Ended | Three Months Ended | |||||||||
| December 31 | September 30 | |||||||||
2004 | 2003 | 2004 | ||||||||
Revenue: | ||||||||||
| North America | $ | 980 | $ | 787 | $ | 969 | ||||
| Latin America | 301 | 255 | 295 | |||||||
| Europe/Africa | 454 | 350 | 442 | |||||||
| Middle East/Asia | 435 | 407 | 402 | |||||||
Total revenue | $ | 2,170 | $ | 1,799 | $ | 2,108 | ||||
Operating income: | ||||||||||
| North America | $ | 222 | $ | 100 | $ | 228 | ||||
| Latin America | 12 | 48 | 52 | |||||||
| Europe/Africa | 65 | 36 | 79 | |||||||
| Middle East/Asia | 71 | 57 | 55 | |||||||
Total operating income | $ | 370 | $ | 241 | $ | 414 | ||||
| Twelve Months Ended | |||||||
| December 31 | |||||||
2004 | 2003 | ||||||
Revenue: | |||||||
| North America | $ | 3,609 | $ | 3,085 | |||
| Latin America | 1,082 | 907 | |||||
| Europe/Africa | 1,665 | 1,442 | |||||
| Middle East/Asia | 1,642 | 1,561 | |||||
Total revenue | $ | 7,998 | $ | 6,995 | |||
Operating income: | |||||||
| North America | $ | 720 | $ | 306 | |||
| Latin America | 130 | 165 | |||||
| Europe/Africa | 189 | 147 | |||||
| Middle East/Asia | 230 | 208 | |||||
Total operating income | $ | 1,269 | $ | 826 | |||
See Footnote Table 2 for a list of significant items included in operating income.
FOOTNOTE TABLE 1
HALLIBURTON COMPANY
Items included in Operating Income by Operating Segment
(Millions of dollars except per share data)
(Unaudited)
| Three Months Ended | Three Months Ended | Three Months Ended | |||||||||||||||||||||||
| December 31 | December 31 | September 30 | |||||||||||||||||||||||
| 2004 | 2003 | 2004 | |||||||||||||||||||||||
| Operating | After Tax | Operating | After Tax | Operating | After Tax | ||||||||||||||||||||
| Income | per Share | Income | per Share | Income | per Share | ||||||||||||||||||||
| Production Optimization: | |||||||||||||||||||||||||
Surface well testing gain on sale | $ | 14 | $ | 0.02 | $ | - | $ | - | $ | 40 | $ | 0.06 | |||||||||||||
| Digital and Consulting | |||||||||||||||||||||||||
Solutions: | |||||||||||||||||||||||||
Integrated solutions projects in Mexico | (33 | ) | (0.05 | ) | - | - | - | - | |||||||||||||||||
Intellectual property settlement | (11 | ) | (0.01 | ) | - | - | - | - | |||||||||||||||||
| Energy and Chemicals: | |||||||||||||||||||||||||
Restructuring charge | (14 | ) | (0.02 | ) | - | - | (14 | ) | (0.02 | ) | |||||||||||||||
Barracuda-Caratinga | |||||||||||||||||||||||||
project loss | - | - | (10 | ) | (0.01 | ) | - | - | |||||||||||||||||
| Government and | |||||||||||||||||||||||||
Infrastructure: | |||||||||||||||||||||||||
Restructuring charge | (8 | ) | (0.01 | ) | - | - | (4 | ) | (0.01 | ) | |||||||||||||||
| Asbestos and silica | - | - | (2 | ) | - | - | - | ||||||||||||||||||
| Twelve Months Ended | Twelve Months Ended | ||||||||||||
| December 31 | December 31 | ||||||||||||
| 2004 | 2003 | ||||||||||||
| Operating | After Tax | Operating | After Tax | ||||||||||
| Income | per Share | Income | per Share | ||||||||||
| Production Optimization: | |||||||||||||
Surface well testing gain on sale | $ | 54 | $ | 0.08 | $ | - | $ | - | |||||
HMS gain on sale | - | - | 24 | 0.03 | |||||||||
| Drilling and Formation Evaluation: | |||||||||||||
Mono Pumps gain on sale | - | - | 36 | 0.05 | |||||||||
| Digital and Consulting Solutions: | |||||||||||||
Integrated solutions projects | |||||||||||||
in Mexico | (33 | ) | (0.05 | ) | - | - | |||||||
Intellectual property settlement | (11 | ) | (0.01 | ) | - | - | |||||||
Anglo-Dutch lawsuit | 13 | 0.02 | (77 | ) | (0.11 | ) | |||||||
Wellstream loss on sale | - | - | (15 | ) | (0.03 | ) | |||||||
| Energy and Chemicals: | |||||||||||||
Restructuring charge | (28 | ) | (0.04 | ) | - | - | |||||||
Barracuda-Caratinga project loss | (407 | ) | (0.60 | ) | (238 | ) | (0.33 | ) | |||||
| Government and Infrastructure: | |||||||||||||
Restructuring charge | (12 | ) | (0.02 | ) | - | - | |||||||
| Asbestos and silica | - | - | (5 | ) | (0.01 | ) | |||||||
FOOTNOTE TABLE 2
HALLIBURTON COMPANY
Items included in Operating Income
By Geographic Region - Energy Services Group Only
(Millions of dollars except per share data)
(Unaudited)
| Three Months Ended | Three Months Ended | Three Months Ended | |||||||||||||||||
| December 31 | December 31 | September 30 | |||||||||||||||||
| 2004 | 2003 | 2004 | |||||||||||||||||
| Operating | After Tax | Operating | After Tax | Operating | After Tax | ||||||||||||||
| Income | per Share | Income | per Share | Income | per Share | ||||||||||||||
| North America: | |||||||||||||||||||
Surface well testing gain on sale | $ | 3 | $ | - | $ | - | $ | - | $ | 19 | $ | 0.03 | |||||||
| Latin America: | |||||||||||||||||||
| Integrated solutions projects in Mexico | (33 | ) | (0.05 | ) | - | - | - | - | |||||||||||
Surface well testinggain on sale | - | - | - | - | 7 | 0.01 | |||||||||||||
| Europe/Africa: | |||||||||||||||||||
Surface well testinggain on sale | 4 | 0.01 | - | - | 14 | 0.02 | |||||||||||||
| Intellectual property settlement | (11 | ) | (0.01 | ) | - | - | - | - | |||||||||||
| Middle East/Asia: | |||||||||||||||||||
| Surface well testing gain on sale | 7 | 0.01 | - | - | - | - | |||||||||||||
| Twelve Months Ended | Twelve Months Ended | ||||||||||||
| December 31 | December 31 | ||||||||||||
| 2004 | 2003 | ||||||||||||
| Operating | After Tax | Operating | After Tax | ||||||||||
| Income | per Share | Income | per Share | ||||||||||
| North America: | |||||||||||||
Anglo-Dutch lawsuit | $ | 13 | $ | 0.02 | $ | (77 | ) | $ | (0.11 | ) | |||
Surface well testing gain on sale | 22 | 0.03 | - | - | |||||||||
Mono Pumps gain on sale | - | - | 24 | 0.03 | |||||||||
Wellstream loss on sale | - | - | (11 | ) | (0.02 | ) | |||||||
HMS gain on sale | - | - | 24 | 0.03 | |||||||||
| Latin America: | |||||||||||||
Integrated solutions projects | |||||||||||||
in Mexico | (33 | ) | (0.05 | ) | - | - | |||||||
| Surface well testing gain on sale | 7 | 0.01 | - | - | |||||||||
| Europe/Africa: | |||||||||||||
| Surface well testing gain on sale | 18 | 0.03 | - | - | |||||||||
Intellectual property settlement | (11 | ) | (0.01 | ) | - | - | |||||||
Mono Pumps gain on sale | - | - | 12 | 0.02 | |||||||||
Wellstream loss on sale | - | - | (4 | ) | (0.01 | ) | |||||||
| Middle East/Asia: | |||||||||||||
| Surface well testing gain on sale | 7 | 0.01 | - | - | |||||||||
###
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| HALLIBURTON COMPANY | ||
| Date: January 28, 2005 | By: | /s/ Margaret E. Carriere |
| Margaret E. Carriere | ||
| Vice President and Secretary |