Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 16, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'BAKER HUGHES INC | ' |
Entity Central Index Key | '0000808362 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 432,598,988 |
Consolidated_Condensed_Stateme
Consolidated Condensed Statements of Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenue: | ' | ' | ' | ' |
Sales | $2,013 | $1,936 | $5,845 | $5,554 |
Services | 4,237 | 3,851 | 12,071 | 10,950 |
Total revenue | 6,250 | 5,787 | 17,916 | 16,504 |
Costs and expenses: | ' | ' | ' | ' |
Cost of sales | 1,620 | 1,490 | 4,651 | 4,341 |
Cost of services | 3,487 | 3,260 | 9,921 | 9,326 |
Research and engineering | 159 | 142 | 461 | 400 |
Marketing, general and administrative | 323 | 319 | 977 | 970 |
Litigation settlements | 0 | 0 | 62 | 0 |
Total costs and expenses | 5,589 | 5,211 | 16,072 | 15,037 |
Operating income | 661 | 576 | 1,844 | 1,467 |
Interest expense, net | -59 | -58 | -175 | -173 |
Income before income taxes | 602 | 518 | 1,669 | 1,294 |
Income taxes | -233 | -178 | -605 | -441 |
Net income | 369 | 340 | 1,064 | 853 |
Net loss (income) attributable to noncontrolling interests | 6 | 1 | -8 | -5 |
Net income attributable to Baker Hughes | $375 | $341 | $1,056 | $848 |
Basic earnings per share attributable to Baker Hughes | $0.86 | $0.77 | $2.42 | $1.91 |
Diluted earnings per share attributable to Baker Hughes | $0.86 | $0.77 | $2.40 | $1.91 |
Cash dividends per share | $0.17 | $0.15 | $0.47 | $0.45 |
Consolidated_Condensed_Stateme1
Consolidated Condensed Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $369 | $340 | $1,064 | $853 |
Other comprehensive (loss) income: | ' | ' | ' | ' |
Foreign currency translation adjustments during the period | -111 | 60 | -108 | -50 |
Pension and other postretirement benefits, net of tax | 4 | -4 | -4 | 9 |
Hedge transactions, net of tax | 0 | 2 | 0 | -1 |
Other comprehensive (loss) income | -107 | 58 | -112 | -42 |
Comprehensive income | 262 | 398 | 952 | 811 |
Comprehensive loss (income) attributable to noncontrolling interests | 6 | 1 | -8 | -5 |
Comprehensive income attributable to Baker Hughes | $268 | $399 | $944 | $806 |
Consolidated_Condensed_Balance
Consolidated Condensed Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $1,209 | $1,399 |
Accounts receivable - less allowance for doubtful accounts (2014 - $247; 2013 - $238) | 5,539 | 5,138 |
Inventories, net | 4,150 | 3,884 |
Deferred income taxes | 426 | 380 |
Other current assets | 487 | 494 |
Total current assets | 11,811 | 11,295 |
Property, plant and equipment - less accumulated depreciation (2014 - $8,025; 2013 - $7,219) | 9,081 | 9,076 |
Goodwill | 6,074 | 5,966 |
Intangible assets, net | 857 | 883 |
Other assets | 819 | 714 |
Total assets | 28,642 | 27,934 |
Current liabilities: | ' | ' |
Accounts payable | 2,745 | 2,574 |
Short-term debt and current portion of long-term debt | 519 | 499 |
Accrued employee compensation | 777 | 778 |
Income taxes payable | 368 | 213 |
Other accrued liabilities | 553 | 514 |
Total current liabilities | 4,962 | 4,578 |
Long-term debt | 3,894 | 3,882 |
Deferred income taxes and other tax liabilities | 742 | 821 |
Liabilities for pensions and other postretirement benefits | 584 | 583 |
Other liabilities | 176 | 158 |
Commitments and contingencies | ' | ' |
Equity: | ' | ' |
Common stock | 433 | 438 |
Capital in excess of par value | 6,977 | 7,341 |
Retained earnings | 11,289 | 10,438 |
Accumulated other comprehensive loss | -616 | -504 |
Baker Hughes stockholders’ equity | 18,083 | 17,713 |
Noncontrolling interests | 201 | 199 |
Total equity | 18,284 | 17,912 |
Total liabilities and equity | $28,642 | $27,934 |
Consolidated_Condensed_Balance1
Consolidated Condensed Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts | $247 | $238 |
Accumulated depreciation | $8,025 | $7,219 |
Consolidated_Condensed_Stateme2
Consolidated Condensed Statements of Changes in Equity (USD $) | Total | Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Non-controlling Interests |
In Millions, unless otherwise specified | ||||||
Balance at Dec. 31, 2012 | $17,268 | $441 | $7,495 | $9,609 | ($476) | $199 |
Comprehensive income: | ' | ' | ' | ' | ' | ' |
Net income | 853 | ' | ' | 848 | ' | 5 |
Other comprehensive loss | -42 | ' | ' | ' | -42 | ' |
Activity related to stock plans | 28 | 2 | 26 | ' | ' | ' |
Stock-based compensation | 93 | ' | 93 | ' | ' | ' |
Cash dividends | -200 | ' | ' | -200 | ' | ' |
Net activity related to noncontrolling interests | -7 | ' | ' | ' | ' | -7 |
Balance at Sep. 30, 2013 | 17,993 | 443 | 7,614 | 10,257 | -518 | 197 |
Balance at Dec. 31, 2013 | 17,912 | 438 | 7,341 | 10,438 | -504 | 199 |
Comprehensive income: | ' | ' | ' | ' | ' | ' |
Net income | 1,064 | ' | ' | 1,056 | ' | 8 |
Other comprehensive loss | -112 | ' | ' | ' | -112 | ' |
Activity related to stock plans | 138 | 4 | 134 | ' | ' | ' |
Repurchase and retirement of common stock | -600 | -9 | -591 | ' | ' | ' |
Stock-based compensation | 93 | ' | 93 | ' | ' | ' |
Cash dividends | -205 | ' | ' | -205 | ' | ' |
Net activity related to noncontrolling interests | -6 | ' | ' | ' | ' | -6 |
Balance at Sep. 30, 2014 | $18,284 | $433 | $6,977 | $11,289 | ($616) | $201 |
Consolidated_Condensed_Stateme3
Consolidated Condensed Statements of Changes in Equity (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Statement of Stockholders' Equity [Abstract] | ' | ' | ' | ' |
Cash dividends per share | $0.17 | $0.15 | $0.47 | $0.45 |
Consolidated_Condensed_Stateme4
Consolidated Condensed Statements of Cash Flows (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash flows from operating activities: | ' | ' |
Net income | $1,064 | $853 |
Adjustments to reconcile net income to net cash flows from operating activities: | ' | ' |
Depreciation and amortization | 1,346 | 1,262 |
Other noncash items | -102 | -53 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -572 | -651 |
Inventories | -280 | -191 |
Accounts payable | 186 | 749 |
Other operating items, net | 112 | 189 |
Net cash flows provided by operating activities | 1,754 | 2,158 |
Cash flows from investing activities: | ' | ' |
Expenditures for capital assets | -1,288 | -1,552 |
Proceeds from disposal of assets | 295 | 276 |
Acquisition of businesses, net of cash acquired | -313 | -22 |
Other investing items, net | 0 | -6 |
Net cash flows used in investing activities | -1,306 | -1,304 |
Cash flows from financing activities: | ' | ' |
Net proceeds (repayments) of commercial paper borrowings and other debt with original maturity of three months or less | 89 | -391 |
Repayments of short-term debt with original maturity greater than three months | -182 | -119 |
Proceeds from short-term debt with greater than three months original maturity | 144 | 178 |
Repurchase of common stock | -600 | 0 |
Proceeds from issuance of common stock | 147 | 50 |
Dividends paid | -205 | -200 |
Other financing items, net | -27 | -17 |
Net cash flows used in financing activities | -634 | -499 |
Effect of foreign exchange rate changes on cash and cash equivalents | -4 | -2 |
(Decrease) increase in cash and cash equivalents | -190 | 353 |
Cash and cash equivalents, beginning of period | 1,399 | 1,015 |
Cash and cash equivalents, end of period | 1,209 | 1,368 |
Supplemental cash flows disclosures: | ' | ' |
Income taxes paid, net of refunds | 571 | 498 |
Interest paid | 199 | 194 |
Supplemental disclosure of noncash investing activities: | ' | ' |
Capital expenditures included in accounts payable | $123 | $99 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | |
Baker Hughes Incorporated (“Baker Hughes,” “Company,” “we,” “our,” or “us,”) is a leading supplier of oilfield services, products, technology and systems used for drilling, formation evaluation, completion and production, pressure pumping, and reservoir development in the worldwide oil and natural gas industry. We also provide products and services for other businesses including downstream chemicals, and process and pipeline services. | |
Basis of Presentation | |
Our unaudited consolidated condensed financial statements included herein have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America (“U.S.”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, certain information and disclosures normally included in our annual financial statements have been condensed or omitted. These unaudited consolidated condensed financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013. We believe the unaudited consolidated condensed financial statements included herein reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the interim periods. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. In the Notes to Unaudited Consolidated Condensed Financial Statements, all dollar and share amounts in tabulations are in millions of dollars and shares, respectively, unless otherwise indicated. | |
New Accounting Standards Updates | |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. The ASU will supersede most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also requires significantly expanded disclosures regarding the qualitative and quantitative information of an entity's nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The pronouncement is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period and is to be applied retrospectively, with early application not permitted. We are currently evaluating the impact the pronouncement will have on our consolidated financial statements and related disclosures. | |
In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements and Property, Plant, and Equipment - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which amends the definition of a discontinued operation by raising the threshold for a disposal to qualify as discontinued operations. The ASU will also require entities to provide additional disclosures about discontinued operations as well as disposal transactions that do not meet the discontinued operations criteria. The pronouncement is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014. Early adoption is permitted. We adopted the ASU in the second quarter of 2014 and it did not impact our consolidated financial statements or the notes to our financial statements. |
Acquisitions_Notes
Acquisitions - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Business Acquisition, Pro Forma Information [Abstract] | ' |
Acquisitions | ' |
NOTE 2. ACQUISITIONS | |
On September 2, 2014, we completed the acquisition of the pipeline and specialty services business of Weatherford International Ltd. ("PSS") for total cash consideration of $246 million, subject to post-closing working capital adjustments. PSS will provide an expanded range of pre-commissioning, deepwater and in-line inspection services worldwide and will be included in our Industrial Services segment. The transaction has been accounted for using the acquisition method of accounting and, accordingly, assets acquired and liabilities assumed were recorded at their preliminary fair values as of the acquisition date subject to adjustment upon completion of the final fair value estimates. As a result of the acquisition, we recorded approximately $60 million of goodwill and approximately $40 million of intangible assets. Pro forma results of operations for this acquisition have not been presented because the effect of this acquisition was not material to our consolidated financial statements. |
Segment_Information_Notes
Segment Information - (Notes) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment Reporting | ' | |||||||||||||||
NOTE 3. SEGMENT INFORMATION | ||||||||||||||||
We are a supplier of oilfield services, products, technology and systems to the worldwide oil and natural gas business, referred to as oilfield operations, which are managed through operating segments that are aligned with our geographic regions. We also provide services and products to the downstream chemicals, and process and pipeline industries, referred to as Industrial Services. | ||||||||||||||||
The performance of our operating segments is evaluated based on profit before tax, which is defined as income before income taxes and before the following: net interest expense, corporate expenses and certain gains and losses not allocated to the operating segments. During the third quarter of 2014, profit before tax for the Europe/Africa/Russia Caspian ("EARC") segment was impacted by a charge of $58 million associated with the restructuring of our North Africa business and impairment of certain assets, resulting primarily from the recent disruption of our operations in Libya. Concurrent with the restructuring of this business, certain North African entities previously reported in our Middle East/Asia Pacific segment were realigned and are now reported within our EARC segment to reflect how we manage the business. Accordingly, all prior segment disclosures for revenue and profit (loss) before taxes for these two segments have been reclassified to reflect this realignment. There were no material changes in segment revenue, profit (loss) before taxes or assets as a result of this change. | ||||||||||||||||
Summarized financial information is shown in the following table: | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
September 30, 2014 | September 30, 2013 | |||||||||||||||
Segments | Revenue | Profit (Loss) Before Taxes | Revenue | Profit (Loss) Before Taxes | ||||||||||||
North America | $ | 3,155 | $ | 380 | $ | 2,854 | $ | 295 | ||||||||
Latin America | 571 | 71 | 557 | (23 | ) | |||||||||||
Europe/Africa/Russia Caspian | 1,114 | 91 | 1,036 | 177 | ||||||||||||
Middle East/Asia Pacific | 1,077 | 155 | 1,012 | 149 | ||||||||||||
Industrial Services | 333 | 35 | 328 | 38 | ||||||||||||
Total Operations | 6,250 | 732 | 5,787 | 636 | ||||||||||||
Corporate and other | — | (71 | ) | — | (60 | ) | ||||||||||
Interest expense, net | — | (59 | ) | — | (58 | ) | ||||||||||
Total | $ | 6,250 | $ | 602 | $ | 5,787 | $ | 518 | ||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
September 30, 2014 | September 30, 2013 | |||||||||||||||
Segments | Revenue | Profit (Loss) Before Taxes | Revenue | Profit (Loss) Before Taxes | ||||||||||||
North America | $ | 8,774 | $ | 978 | $ | 8,134 | $ | 741 | ||||||||
Latin America | 1,645 | 172 | 1,704 | 8 | ||||||||||||
Europe/Africa/Russia Caspian | 3,269 | 421 | 2,948 | 430 | ||||||||||||
Middle East/Asia Pacific | 3,241 | 448 | 2,785 | 371 | ||||||||||||
Industrial Services | 987 | 96 | 933 | 101 | ||||||||||||
Total Operations | 17,916 | 2,115 | 16,504 | 1,651 | ||||||||||||
Corporate and other | — | (209 | ) | — | (184 | ) | ||||||||||
Interest expense, net | — | (175 | ) | — | (173 | ) | ||||||||||
Litigation settlements | — | (62 | ) | — | — | |||||||||||
Total | $ | 17,916 | $ | 1,669 | $ | 16,504 | $ | 1,294 | ||||||||
Income_Taxes_Notes
Income Taxes - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
NOTE 4. INCOME TAXES | |
Total income tax expense was $233 million and $605 million for the three and nine months ended September 30, 2014, respectively. Our effective tax rate on income before income taxes for the three and nine months ended September 30, 2014 was 38.7% and 36.2%, respectively. Our effective tax rates are higher than the U.S. statutory income tax rate of 35% primarily due to the third quarter 2014 charge of $58 million associated with the restructuring of our North Africa business and other losses where there is no tax benefit. |
Venezuelan_Currency_Devaluatio
Venezuelan Currency Devaluation - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Foreign Currency [Abstract] | ' |
Venezuelan Currency Devaluation | ' |
NOTE 5. VENEZUELAN CURRENCY DEVALUATION | |
In early 2014, the Venezuelan government modified the currency exchange system by establishing two new exchange mechanisms, SICAD 1 and SICAD2, where participation in the auction process of each mechanism is controlled by the Venezuelan government depending on the economic sector within which a company operates. These mechanisms are in addition to the existing official exchange rate. There could be additional changes to exchange mechanisms in the future. | |
We have not been eligible to apply for exchange at the official rate nor have we been allowed to participate in the SICAD 1 auctions. We have successfully participated in SICAD 2 auctions. As a result, during the second quarter of 2014, we adopted the SICAD 2 exchange rate of approximately 50 BsF per USD for purposes of remeasuring BsF denominated assets and liabilities and revenue and expenses because we believe the SICAD 2 rate was and continues to be the rate most representative of the economics in which we operate. Prior to this change, we were using the official exchange rate of 6.3 BsF per USD. The impact of this devaluation in the currency was a loss of $12 million resulting from the write down of our BsF denominated monetary assets and liabilities. This loss was recorded in marketing, general and administrative expense in the second quarter of 2014. | |
In February 2013, Venezuela's currency was devalued from the prior official exchange rate of 4.3 BsF per USD to 6.3 BsF per USD, which applied to our BsF denominated monetary assets and liabilities. The impact of this devaluation in the currency was a loss of $23 million and was recorded in marketing, general and administrative expense in the first quarter of 2013. |
Earnings_Per_Share_Notes
Earnings Per Share - (Notes) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||
Earnings Per Share | ' | |||||||||||
NOTE 6. EARNINGS PER SHARE | ||||||||||||
A reconciliation of the number of shares used for the basic and diluted earnings per share (“EPS”) computations is as follows: | ||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Weighted average common shares outstanding for basic EPS | 436 | 444 | 437 | 443 | ||||||||
Adjustment for effect of dilutive securities - stock plans | 2 | 1 | 3 | 1 | ||||||||
Weighted average common shares outstanding for diluted EPS | 438 | 445 | 440 | 444 | ||||||||
Future potentially dilutive shares excluded from diluted EPS: | ||||||||||||
Options with an exercise price greater than the average market price for the period | 2 | 5 | 2 | 8 | ||||||||
Inventories_Notes
Inventories - (Notes) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Inventory, Net [Abstract] | ' | |||||||
Inventories | ' | |||||||
NOTE 7. INVENTORIES | ||||||||
Inventories, net of reserves, are comprised of the following: | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Finished goods | $ | 3,674 | $ | 3,438 | ||||
Work in process | 258 | 215 | ||||||
Raw materials | 218 | 231 | ||||||
Total inventories | $ | 4,150 | $ | 3,884 | ||||
Intangible_Assets_Notes
Intangible Assets - (Notes) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | |||||||||||||||||||||||
Intangible Assets | ' | |||||||||||||||||||||||
NOTE 8. INTANGIBLE ASSETS | ||||||||||||||||||||||||
Intangible assets are comprised of the following: | ||||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||||||||||
Gross | Less: | Net | Gross | Less: | Net | |||||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | |||||||||||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||||||||||
Technology | $ | 850 | $ | 378 | $ | 472 | $ | 814 | $ | 337 | $ | 477 | ||||||||||||
Customer relationships | 509 | 187 | 322 | 494 | 157 | 337 | ||||||||||||||||||
Trade names | 122 | 90 | 32 | 120 | 82 | 38 | ||||||||||||||||||
Other (1) | 43 | 12 | 31 | 43 | 12 | 31 | ||||||||||||||||||
Total intangible assets | $ | 1,524 | $ | 667 | $ | 857 | $ | 1,471 | $ | 588 | $ | 883 | ||||||||||||
(1) | Includes indefinite-lived intangibles of $26 million at September 30, 2014 and $27 million at December 31, 2013 related to in-process research and development projects. | |||||||||||||||||||||||
Intangible assets are generally amortized on a straight-line basis with estimated useful lives ranging from 3 to 30 years. Amortization expense included in net income for the three and nine months ended September 30, 2014 was $26 million and $79 million, respectively, as compared to $30 million and $89 million reported in 2013 for the same period. | ||||||||||||||||||||||||
Amortization expense of these intangibles over the remainder of 2014 and for each of the subsequent five fiscal years is expected to be as follows: | ||||||||||||||||||||||||
Year | Estimated Amortization Expense | |||||||||||||||||||||||
Remainder of 2014 | $ | 28 | ||||||||||||||||||||||
2015 | 102 | |||||||||||||||||||||||
2016 | 101 | |||||||||||||||||||||||
2017 | 97 | |||||||||||||||||||||||
2018 | 91 | |||||||||||||||||||||||
2019 | 88 | |||||||||||||||||||||||
Financial_Instruments_Notes
Financial Instruments - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Fair Value Disclosures [Abstract] | ' |
Financial Instruments | ' |
NOTE 9. FINANCIAL INSTRUMENTS | |
Our financial instruments include cash and cash equivalents, accounts receivable, accounts payable, debt and foreign currency forward contracts. Except as described below, the estimated fair value of such financial instruments at September 30, 2014 and December 31, 2013 approximates their carrying value as reflected in our unaudited consolidated condensed balance sheets. | |
The estimated fair value of total debt at September 30, 2014 and December 31, 2013 was $5,021 million and $4,857 million, respectively, which differs from the carrying amounts of $4,413 million and $4,381 million, respectively, included in our unaudited consolidated condensed balance sheets. The fair value was determined using quoted period-end market prices. |
Employee_Benefit_Plans_Notes
Employee Benefit Plans - (Notes) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | |||||||||||||||||||||||
Employee Benefits Plans | ' | |||||||||||||||||||||||
NOTE 10. EMPLOYEE BENEFIT PLANS | ||||||||||||||||||||||||
We have both funded and unfunded noncontributory defined benefit pension plans ("Pension Benefits") covering certain employees primarily in the U.S., the United Kingdom, Germany and Canada. We also provide certain postretirement health care benefits (“Other Postretirement Benefits”), through an unfunded plan, to a closed group of U.S. employees who, when they retire, have met certain age and service requirements. | ||||||||||||||||||||||||
The components of net periodic cost are as follows for the three months ended September 30: | ||||||||||||||||||||||||
U.S. Pension Benefits | Non-U.S. Pension Benefits | Other Postretirement Benefits | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Service cost | $ | 17 | $ | 16 | $ | 3 | $ | 4 | $ | 1 | $ | 1 | ||||||||||||
Interest cost | 7 | 5 | 8 | 8 | 1 | 1 | ||||||||||||||||||
Expected return on plan assets | (11 | ) | (9 | ) | (9 | ) | (9 | ) | — | — | ||||||||||||||
Amortization of prior service credit | — | — | — | — | (2 | ) | (2 | ) | ||||||||||||||||
Amortization of net actuarial loss | 2 | 3 | 1 | 2 | 1 | 1 | ||||||||||||||||||
Net periodic cost | $ | 15 | $ | 15 | $ | 3 | $ | 5 | $ | 1 | $ | 1 | ||||||||||||
The components of net periodic cost are as follows for the nine months ended September 30: | ||||||||||||||||||||||||
U.S. Pension Benefits | Non-U.S. Pension Benefits | Other Postretirement Benefits | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Service cost | $ | 52 | $ | 48 | $ | 10 | $ | 12 | $ | 4 | $ | 5 | ||||||||||||
Interest cost | 21 | 16 | 26 | 24 | 4 | 3 | ||||||||||||||||||
Expected return on plan assets | (33 | ) | (29 | ) | (29 | ) | (29 | ) | — | — | ||||||||||||||
Amortization of prior service credit | — | — | — | — | (5 | ) | (6 | ) | ||||||||||||||||
Amortization of net actuarial loss | 6 | 10 | 3 | 6 | 2 | 3 | ||||||||||||||||||
Other | — | — | — | — | (3 | ) | — | |||||||||||||||||
Net periodic cost | $ | 46 | $ | 45 | $ | 10 | $ | 13 | $ | 2 | $ | 5 | ||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies - (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
NOTE 11. COMMITMENTS AND CONTINGENCIES | |
LITIGATION | |
We are subject to a number of lawsuits and claims arising out of the conduct of our business. The ability to predict the ultimate outcome of such matters involves judgments, estimates and inherent uncertainties. We record a liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated, including accruals for self-insured losses which are calculated based on historical claim data, specific loss development factors and other information. A range of total possible losses for all litigation matters cannot be reasonably estimated. Based on a consideration of all relevant facts and circumstances, we do not expect the ultimate outcome of any currently pending lawsuits or claims against us will have a material adverse effect on our financial position, results of operations or cash flows; however, there can be no assurance as to the ultimate outcome of these matters. | |
We insure against risks arising from our business to the extent deemed prudent by our management and to the extent insurance is available, but no assurance can be given that the nature and amount of that insurance will be sufficient to fully indemnify us against liabilities arising out of pending or future legal proceedings or other claims. Most of our insurance policies contain deductibles or self-insured retentions in amounts we deem prudent and for which we are responsible for payment. In determining the amount of self-insurance, it is our policy to self-insure those losses that are predictable, measurable and recurring in nature, such as claims for automobile liability, general liability and workers compensation. | |
During the third quarter of 2014, we investigated customer notifications related to a possible equipment failure in a natural gas storage system in the EARC region, which includes certain of our products. We are currently investigating the cause of the possible failure and, if necessary, possible repair and replacement options for our products. Similar products were utilized in other natural gas storage systems for this and other customers. At this time, we are not able to predict whether our products will need to be repaired or replaced and are not able to reasonably estimate the impact, if any, such repairs or replacements or other damages would have on our financial position, results of operations or cash flows. | |
We are a defendant in various labor claims including the following matters. On April 28, 2014, a collective action lawsuit alleging that we failed to pay an as-yet-undetermined class of workers overtime in compliance with the Fair Labor Standards Act ("FLSA") was filed titled Michael Ciamillo, individually, etc., et al. vs. Baker Hughes Incorporated in the U.S. District Court for the District of Alaska (“Ciamillo”). We have accrued an estimate of potential damages for the Ciamillo lawsuit, the amount of which was not material to our financial position, results of operations or cash flows. On December 10, 2013, a class and collective action lawsuit alleging that we failed to pay a nationwide class of workers overtime in compliance with the FLSA and certain state laws was filed titled Lea et al. v. Baker Hughes, Inc. in the U.S. District Court for the Southern District of Texas, Galveston Division ("Lea"). During the second quarter of 2014, the parties agreed to settle the Lea lawsuit, subject to final court approval, and we recorded a charge of $62 million, which includes the Lea settlement amount and associated costs and an amount for settlement of another wage and hour lawsuit. On October 21, 2013, a collective action lawsuit alleging that we failed to pay a class of workers overtime in compliance with the FLSA was filed titled Zamora et al. v. Baker Hughes Incorporated in the U.S. District Court for the Southern District of Texas, Corpus Christi Division (“Zamora”). In October of 2014, the parties agreed to settle the Zamora lawsuit, subject to final court approval, for an amount that was not material to our financial position, results of operations or cash flows. | |
On May 30, 2013, we received a Civil Investigative Demand ("CID") from the U.S. Department of Justice ("DOJ") pursuant to the Antitrust Civil Process Act. The CID seeks documents and information from us for the period from May 29, 2011 through the date of the CID in connection with a DOJ investigation related to pressure pumping services in the U.S. We are working with the DOJ to provide the requested documents and information. We are not able to predict what action, if any, might be taken in the future by the DOJ or other governmental authorities as a result of the investigation. | |
OTHER | |
In the normal course of business with customers, vendors and others, we have entered into off-balance sheet arrangements, such as surety bonds for performance, letters of credit and other bank issued guarantees, which totaled approximately $1.6 billion at September 30, 2014. It is not practicable to estimate the fair value of these financial instruments. None of the off-balance sheet arrangements either has, or is likely to have, a material effect on our financial position, results of operations or cash flows. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss - (Notes) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ' | ||||||||||||||||||||
Accumulated Other Comprehensive Loss | ' | ||||||||||||||||||||
NOTE 12. ACCUMULATED OTHER COMPREHENSIVE LOSS | |||||||||||||||||||||
The following tables present the changes in accumulated other comprehensive loss, net of tax: | |||||||||||||||||||||
Pensions and Other Postretirement Benefits | Foreign Currency Translation Adjustments | Accumulated Other Comprehensive Loss | |||||||||||||||||||
Balance at December 31, 2013 | $ | (217 | ) | $ | (287 | ) | $ | (504 | ) | ||||||||||||
Other comprehensive loss before reclassifications | (5 | ) | (108 | ) | (113 | ) | |||||||||||||||
Amounts reclassified from accumulated other comprehensive loss | 3 | — | 3 | ||||||||||||||||||
Deferred taxes | (2 | ) | — | (2 | ) | ||||||||||||||||
Balance at September 30, 2014 | $ | (221 | ) | $ | (395 | ) | $ | (616 | ) | ||||||||||||
Hedge Transactions | Pensions and Other Postretirement Benefits | Foreign Currency Translation Adjustments | Accumulated Other Comprehensive Loss | ||||||||||||||||||
Balance at December 31, 2012 | $ | — | $ | (250 | ) | $ | (226 | ) | $ | (476 | ) | ||||||||||
Other comprehensive loss before reclassifications | (1 | ) | — | (50 | ) | (51 | ) | ||||||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | 13 | — | 13 | |||||||||||||||||
Deferred taxes | — | (4 | ) | — | (4 | ) | |||||||||||||||
Balance at September 30, 2013 | $ | (1 | ) | $ | (241 | ) | $ | (276 | ) | $ | (518 | ) | |||||||||
The amounts reclassified from accumulated other comprehensive loss during the nine months ended September 30, 2014 and 2013 represent the amortization of prior service credit, net actuarial loss, and other which are included in the computation of net periodic cost (see Note 10. Employee Benefit Plans for additional details). Net periodic cost is recorded in cost of sales and services, research and engineering, and marketing, general and administrative expenses. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies - (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Nature of Operations | ' |
Nature of Operations | |
Baker Hughes Incorporated (“Baker Hughes,” “Company,” “we,” “our,” or “us,”) is a leading supplier of oilfield services, products, technology and systems used for drilling, formation evaluation, completion and production, pressure pumping, and reservoir development in the worldwide oil and natural gas industry. We also provide products and services for other businesses including downstream chemicals, and process and pipeline services. | |
Basis of Presentation | ' |
Basis of Presentation | |
Our unaudited consolidated condensed financial statements included herein have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America (“U.S.”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, certain information and disclosures normally included in our annual financial statements have been condensed or omitted. These unaudited consolidated condensed financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013. We believe the unaudited consolidated condensed financial statements included herein reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the interim periods. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. In the Notes to Unaudited Consolidated Condensed Financial Statements, all dollar and share amounts in tabulations are in millions of dollars and shares, respectively, unless otherwise indicated. | |
New Accounting Standards Updates | ' |
New Accounting Standards Updates | |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. The ASU will supersede most of the existing revenue recognition requirements in U.S. GAAP and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also requires significantly expanded disclosures regarding the qualitative and quantitative information of an entity's nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The pronouncement is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period and is to be applied retrospectively, with early application not permitted. We are currently evaluating the impact the pronouncement will have on our consolidated financial statements and related disclosures. | |
In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements and Property, Plant, and Equipment - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which amends the definition of a discontinued operation by raising the threshold for a disposal to qualify as discontinued operations. The ASU will also require entities to provide additional disclosures about discontinued operations as well as disposal transactions that do not meet the discontinued operations criteria. The pronouncement is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014. Early adoption is permitted. We adopted the ASU in the second quarter of 2014 and it did not impact our consolidated financial statements or the notes to our financial statements. |
Segment_Information_Tables
Segment Information - (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Segment Reporting Information [Line Items] | ' | |||||||||||||||
Summarized financial information | ' | |||||||||||||||
Summarized financial information is shown in the following table: | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
September 30, 2014 | September 30, 2013 | |||||||||||||||
Segments | Revenue | Profit (Loss) Before Taxes | Revenue | Profit (Loss) Before Taxes | ||||||||||||
North America | $ | 3,155 | $ | 380 | $ | 2,854 | $ | 295 | ||||||||
Latin America | 571 | 71 | 557 | (23 | ) | |||||||||||
Europe/Africa/Russia Caspian | 1,114 | 91 | 1,036 | 177 | ||||||||||||
Middle East/Asia Pacific | 1,077 | 155 | 1,012 | 149 | ||||||||||||
Industrial Services | 333 | 35 | 328 | 38 | ||||||||||||
Total Operations | 6,250 | 732 | 5,787 | 636 | ||||||||||||
Corporate and other | — | (71 | ) | — | (60 | ) | ||||||||||
Interest expense, net | — | (59 | ) | — | (58 | ) | ||||||||||
Total | $ | 6,250 | $ | 602 | $ | 5,787 | $ | 518 | ||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
September 30, 2014 | September 30, 2013 | |||||||||||||||
Segments | Revenue | Profit (Loss) Before Taxes | Revenue | Profit (Loss) Before Taxes | ||||||||||||
North America | $ | 8,774 | $ | 978 | $ | 8,134 | $ | 741 | ||||||||
Latin America | 1,645 | 172 | 1,704 | 8 | ||||||||||||
Europe/Africa/Russia Caspian | 3,269 | 421 | 2,948 | 430 | ||||||||||||
Middle East/Asia Pacific | 3,241 | 448 | 2,785 | 371 | ||||||||||||
Industrial Services | 987 | 96 | 933 | 101 | ||||||||||||
Total Operations | 17,916 | 2,115 | 16,504 | 1,651 | ||||||||||||
Corporate and other | — | (209 | ) | — | (184 | ) | ||||||||||
Interest expense, net | — | (175 | ) | — | (173 | ) | ||||||||||
Litigation settlements | — | (62 | ) | — | — | |||||||||||
Total | $ | 17,916 | $ | 1,669 | $ | 16,504 | $ | 1,294 | ||||||||
Earnings_Per_Share_Tables
Earnings Per Share - (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||
Reconciliation of Weighted Average Number of Shares | ' | |||||||||||
A reconciliation of the number of shares used for the basic and diluted earnings per share (“EPS”) computations is as follows: | ||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Weighted average common shares outstanding for basic EPS | 436 | 444 | 437 | 443 | ||||||||
Adjustment for effect of dilutive securities - stock plans | 2 | 1 | 3 | 1 | ||||||||
Weighted average common shares outstanding for diluted EPS | 438 | 445 | 440 | 444 | ||||||||
Future potentially dilutive shares excluded from diluted EPS: | ||||||||||||
Options with an exercise price greater than the average market price for the period | 2 | 5 | 2 | 8 | ||||||||
Inventories_Tables
Inventories - (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Inventory, Net [Abstract] | ' | |||||||
Inventories, net of reserves | ' | |||||||
Inventories, net of reserves, are comprised of the following: | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Finished goods | $ | 3,674 | $ | 3,438 | ||||
Work in process | 258 | 215 | ||||||
Raw materials | 218 | 231 | ||||||
Total inventories | $ | 4,150 | $ | 3,884 | ||||
Intangible_Assets_Tables
Intangible Assets - (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ' | |||||||||||||||||||||||
Schedule of Finite-Lived Intangible Assets | ' | |||||||||||||||||||||||
Intangible assets are comprised of the following: | ||||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | |||||||||||||||||||||||
Gross | Less: | Net | Gross | Less: | Net | |||||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | |||||||||||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||||||||||
Technology | $ | 850 | $ | 378 | $ | 472 | $ | 814 | $ | 337 | $ | 477 | ||||||||||||
Customer relationships | 509 | 187 | 322 | 494 | 157 | 337 | ||||||||||||||||||
Trade names | 122 | 90 | 32 | 120 | 82 | 38 | ||||||||||||||||||
Other (1) | 43 | 12 | 31 | 43 | 12 | 31 | ||||||||||||||||||
Total intangible assets | $ | 1,524 | $ | 667 | $ | 857 | $ | 1,471 | $ | 588 | $ | 883 | ||||||||||||
(1) | Includes indefinite-lived intangibles of $26 million at September 30, 2014 and $27 million at December 31, 2013 related to in-process research and development projects. | |||||||||||||||||||||||
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | ' | |||||||||||||||||||||||
Amortization expense of these intangibles over the remainder of 2014 and for each of the subsequent five fiscal years is expected to be as follows: | ||||||||||||||||||||||||
Year | Estimated Amortization Expense | |||||||||||||||||||||||
Remainder of 2014 | $ | 28 | ||||||||||||||||||||||
2015 | 102 | |||||||||||||||||||||||
2016 | 101 | |||||||||||||||||||||||
2017 | 97 | |||||||||||||||||||||||
2018 | 91 | |||||||||||||||||||||||
2019 | 88 | |||||||||||||||||||||||
Employee_Benefit_Plans_Tables
Employee Benefit Plans - (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | |||||||||||||||||||||||
Schedule of Net Benefit Costs | ' | |||||||||||||||||||||||
The components of net periodic cost are as follows for the three months ended September 30: | ||||||||||||||||||||||||
U.S. Pension Benefits | Non-U.S. Pension Benefits | Other Postretirement Benefits | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Service cost | $ | 17 | $ | 16 | $ | 3 | $ | 4 | $ | 1 | $ | 1 | ||||||||||||
Interest cost | 7 | 5 | 8 | 8 | 1 | 1 | ||||||||||||||||||
Expected return on plan assets | (11 | ) | (9 | ) | (9 | ) | (9 | ) | — | — | ||||||||||||||
Amortization of prior service credit | — | — | — | — | (2 | ) | (2 | ) | ||||||||||||||||
Amortization of net actuarial loss | 2 | 3 | 1 | 2 | 1 | 1 | ||||||||||||||||||
Net periodic cost | $ | 15 | $ | 15 | $ | 3 | $ | 5 | $ | 1 | $ | 1 | ||||||||||||
The components of net periodic cost are as follows for the nine months ended September 30: | ||||||||||||||||||||||||
U.S. Pension Benefits | Non-U.S. Pension Benefits | Other Postretirement Benefits | ||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||
Service cost | $ | 52 | $ | 48 | $ | 10 | $ | 12 | $ | 4 | $ | 5 | ||||||||||||
Interest cost | 21 | 16 | 26 | 24 | 4 | 3 | ||||||||||||||||||
Expected return on plan assets | (33 | ) | (29 | ) | (29 | ) | (29 | ) | — | — | ||||||||||||||
Amortization of prior service credit | — | — | — | — | (5 | ) | (6 | ) | ||||||||||||||||
Amortization of net actuarial loss | 6 | 10 | 3 | 6 | 2 | 3 | ||||||||||||||||||
Other | — | — | — | — | (3 | ) | — | |||||||||||||||||
Net periodic cost | $ | 46 | $ | 45 | $ | 10 | $ | 13 | $ | 2 | $ | 5 | ||||||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss - (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ' | ||||||||||||||||||||
Accumulated Other Comprehensive Loss | ' | ||||||||||||||||||||
The following tables present the changes in accumulated other comprehensive loss, net of tax: | |||||||||||||||||||||
Pensions and Other Postretirement Benefits | Foreign Currency Translation Adjustments | Accumulated Other Comprehensive Loss | |||||||||||||||||||
Balance at December 31, 2013 | $ | (217 | ) | $ | (287 | ) | $ | (504 | ) | ||||||||||||
Other comprehensive loss before reclassifications | (5 | ) | (108 | ) | (113 | ) | |||||||||||||||
Amounts reclassified from accumulated other comprehensive loss | 3 | — | 3 | ||||||||||||||||||
Deferred taxes | (2 | ) | — | (2 | ) | ||||||||||||||||
Balance at September 30, 2014 | $ | (221 | ) | $ | (395 | ) | $ | (616 | ) | ||||||||||||
Hedge Transactions | Pensions and Other Postretirement Benefits | Foreign Currency Translation Adjustments | Accumulated Other Comprehensive Loss | ||||||||||||||||||
Balance at December 31, 2012 | $ | — | $ | (250 | ) | $ | (226 | ) | $ | (476 | ) | ||||||||||
Other comprehensive loss before reclassifications | (1 | ) | — | (50 | ) | (51 | ) | ||||||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | 13 | — | 13 | |||||||||||||||||
Deferred taxes | — | (4 | ) | — | (4 | ) | |||||||||||||||
Balance at September 30, 2013 | $ | (1 | ) | $ | (241 | ) | $ | (276 | ) | $ | (518 | ) |
Acquisitions_Details
Acquisitions - (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2014 |
Business Acquisition, Pro Forma Information [Abstract] | ' |
Business Combination, Consideration Transferred | $246 |
Goodwill, Acquired During Period | 60 |
Finite-lived Intangible Assets Acquired | $40 |
Segment_Information_Details
Segment Information - (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Segment Reporting Information [Line Items] | ' | ' | ' | ' |
Restructuring Charges | $58 | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 6,250 | 5,787 | 17,916 | 16,504 |
Profit (Loss) Before Taxes | 602 | 518 | 1,669 | 1,294 |
North America | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 3,155 | 2,854 | 8,774 | 8,134 |
Profit (Loss) Before Taxes | 380 | 295 | 978 | 741 |
Latin America | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 571 | 557 | 1,645 | 1,704 |
Profit (Loss) Before Taxes | 71 | -23 | 172 | 8 |
Europe/Africa/Russia Caspian | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 1,114 | 1,036 | 3,269 | 2,948 |
Profit (Loss) Before Taxes | 91 | 177 | 421 | 430 |
Middle East/Asia Pacific | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 1,077 | 1,012 | 3,241 | 2,785 |
Profit (Loss) Before Taxes | 155 | 149 | 448 | 371 |
Industrial Services | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 333 | 328 | 987 | 933 |
Profit (Loss) Before Taxes | 35 | 38 | 96 | 101 |
Total Operations | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 6,250 | 5,787 | 17,916 | 16,504 |
Profit (Loss) Before Taxes | 732 | 636 | 2,115 | 1,651 |
Corporate and other | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 0 | 0 | 0 | 0 |
Profit (Loss) Before Taxes | -71 | -60 | -209 | -184 |
Interest expense, net | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | 0 | 0 | 0 | 0 |
Profit (Loss) Before Taxes | -59 | -58 | -175 | -173 |
Litigation settlements | ' | ' | ' | ' |
Summarized financial information [Abstract] | ' | ' | ' | ' |
Revenue | ' | ' | 0 | 0 |
Profit (Loss) Before Taxes | ' | ' | ($62) | $0 |
Income_Taxes_Details
Income Taxes - (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Rate | Rate | |||
Income Tax Disclosure [Abstract] | ' | ' | ' | ' |
Income taxes | $233 | $178 | $605 | $441 |
Effective Income Tax Rate Reconciliation, Percent | 38.70% | ' | 36.20% | ' |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | ' | ' | 35.00% | ' |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Other, Amount | $58 | ' | ' | ' |
Venezuelan_Currency_Devaluatio1
Venezuelan Currency Devaluation - (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Jun. 30, 2014 | Mar. 31, 2013 |
Foreign Currency [Abstract] | ' | ' |
Preexisting Currency Exchange Rate | ' | 4.3 |
New Currency Exchange Rate | ' | 6.3 |
SICAD 2 Exchange Rate | 50 | ' |
Foreign Currency Transaction Loss, before Tax | $12 | $23 |
Earnings_Per_Share_Details
Earnings Per Share - (Details) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Weighted average common shares outstanding for basic EPS | 436 | 444 | 437 | 443 |
Adjustment for effect of dilutive securities - stock plans | 2 | 1 | 3 | 1 |
Weighted average common shares outstanding for diluted EPS | 438 | 445 | 440 | 444 |
Future potentially dilutive shares excluded from diluted EPS: | ' | ' | ' | ' |
Options with an exercise price greater than the average market price for the period | 2 | 5 | 2 | 8 |
Inventories_Details
Inventories - (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Inventory, Net [Abstract] | ' | ' |
Finished goods | $3,674 | $3,438 |
Work in process | 258 | 215 |
Raw materials | 218 | 231 |
Total inventories | $4,150 | $3,884 |
Intangible_Assets_Schedule_of_
Intangible Assets - Schedule of Intangible Assets by Type (Details) (USD $) | 9 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Document Period End Date | 30-Sep-14 | ' | ||
Finite-Lived Intangible Assets, Gross | $1,524 | $1,471 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 667 | 588 | ||
Finite-Lived Intangible Assets, Net | 857 | 883 | ||
Technology-Based Intangible Assets | ' | ' | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Finite-Lived Intangible Assets, Gross | 850 | 814 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 378 | 337 | ||
Finite-Lived Intangible Assets, Net | 472 | 477 | ||
Customer Relationships | ' | ' | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Finite-Lived Intangible Assets, Gross | 509 | 494 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 187 | 157 | ||
Finite-Lived Intangible Assets, Net | 322 | 337 | ||
Trade Names | ' | ' | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Finite-Lived Intangible Assets, Gross | 122 | 120 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | 90 | 82 | ||
Finite-Lived Intangible Assets, Net | 32 | 38 | ||
Other Intangible Assets | ' | ' | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Finite-Lived Intangible Assets, Gross | 43 | [1] | 43 | [1] |
Finite-Lived Intangible Assets, Accumulated Amortization | 12 | 12 | ||
Finite-Lived Intangible Assets, Net | 31 | [1] | 31 | [1] |
In Process Research and Development | ' | ' | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ' | ' | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $26 | [1] | $27 | [1] |
[1] | Includes indefinite-lived intangibles of $26 million at September 30, 2014 and $27 million at December 31, 2013 related to in-process research and development projects. |
Intangible_Assets_Schedule_of_1
Intangible Assets - Schedule of Future Estimated Amortization Expense (Details) (USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ' |
Reminder of 2014 | $28 |
2015 | 102 |
2016 | 101 |
2017 | 97 |
2018 | 91 |
2019 | $88 |
Intangible_Assets_Textual_Info
Intangible Assets - Textual Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | ||
Minimum | Maximum | In Process Research and Development [Member] | In Process Research and Development [Member] | |||||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ||
Document Fiscal Year Focus | ' | ' | '2014 | ' | ' | ' | ' | ' | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill) | ' | ' | ' | ' | ' | ' | $26 | [1] | $27 | [1] |
Document Period End Date | ' | ' | 30-Sep-14 | ' | ' | ' | ' | ' | ||
Finite-Lived Intangible Asset, Useful Life | ' | ' | ' | ' | '3 years 0 months 0 days | '30 years 0 months 0 days | ' | ' | ||
Amortization expense for intangible assets included in net income | $26 | $30 | $79 | $89 | ' | ' | ' | ' | ||
[1] | Includes indefinite-lived intangibles of $26 million at September 30, 2014 and $27 million at December 31, 2013 related to in-process research and development projects. |
Financial_Instruments_Details
Financial Instruments - (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Fair Value Disclosures [Abstract] | ' | ' |
Debt, fair value | $5,021 | $4,857 |
Debt, Long-term and Short-term, Combined Amount | $4,413 | $4,381 |
Employee_Benefit_Plans_Details
Employee Benefit Plans - (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
U.S. Pension Benefits | ' | ' | ' | ' |
Components of net periodic benefit cost [Abstract] | ' | ' | ' | ' |
Service cost | $17 | $16 | $52 | $48 |
Interest cost | 7 | 5 | 21 | 16 |
Expected return on plan assets | -11 | -9 | -33 | -29 |
Amortization of prior service credit | 0 | 0 | 0 | 0 |
Amortization of net actuarial loss | 2 | 3 | 6 | 10 |
Other | ' | ' | 0 | 0 |
Net periodic cost | 15 | 15 | 46 | 45 |
Non-U.S. Pension Benefits | ' | ' | ' | ' |
Components of net periodic benefit cost [Abstract] | ' | ' | ' | ' |
Service cost | 3 | 4 | 10 | 12 |
Interest cost | 8 | 8 | 26 | 24 |
Expected return on plan assets | -9 | -9 | -29 | -29 |
Amortization of prior service credit | 0 | 0 | 0 | 0 |
Amortization of net actuarial loss | 1 | 2 | 3 | 6 |
Other | ' | ' | 0 | 0 |
Net periodic cost | 3 | 5 | 10 | 13 |
Other Postretirement Benefits | ' | ' | ' | ' |
Components of net periodic benefit cost [Abstract] | ' | ' | ' | ' |
Service cost | 1 | 1 | 4 | 5 |
Interest cost | 1 | 1 | 4 | 3 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service credit | -2 | -2 | -5 | -6 |
Amortization of net actuarial loss | 1 | 1 | 2 | 3 |
Other | ' | ' | -3 | 0 |
Net periodic cost | $1 | $1 | $2 | $5 |
Commitments_and_Contingencies_1
Commitments and Contingencies - (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' | ' | ' |
Litigation settlements | $0 | $62,000,000 | $0 | $62,000,000 | $0 |
Off-balance sheet arrangements related to letters of credit and other bank issued guarantees, total | $1,600,000,000 | ' | ' | $1,600,000,000 | ' |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss - (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Accumulated Other Comprehensive Loss [Line Items] | ' | ' |
Beginning Balance | ($504) | ($476) |
Other comprehensive loss before reclassifications | -113 | -51 |
Amounts reclassified from accumulated other comprehensive loss | 3 | 13 |
Deferred taxes | -2 | -4 |
Ending Balance | -616 | -518 |
Pensions and Other Postretirement Benefits | ' | ' |
Accumulated Other Comprehensive Loss [Line Items] | ' | ' |
Beginning Balance | -217 | -250 |
Other comprehensive loss before reclassifications | -5 | 0 |
Amounts reclassified from accumulated other comprehensive loss | 3 | 13 |
Deferred taxes | -2 | -4 |
Ending Balance | -221 | -241 |
Foreign Currency Translation Adjustments | ' | ' |
Accumulated Other Comprehensive Loss [Line Items] | ' | ' |
Beginning Balance | -287 | -226 |
Other comprehensive loss before reclassifications | -108 | -50 |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 |
Deferred taxes | 0 | 0 |
Ending Balance | -395 | -276 |
Hedge Transactions | ' | ' |
Accumulated Other Comprehensive Loss [Line Items] | ' | ' |
Beginning Balance | ' | 0 |
Other comprehensive loss before reclassifications | ' | -1 |
Amounts reclassified from accumulated other comprehensive loss | ' | 0 |
Deferred taxes | ' | 0 |
Ending Balance | ' | ($1) |