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EXHIBIT 99.4
WEATHERFORD ENTERRA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
MARCH 31, DECEMBER 31,
1998 1997
------------ ------------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents .................................................................. $ 17,318 $ 42,348
Receivables, net of allowance of $24,251 and $22,467 ...................................... 267,991 261,449
Inventories, net of allowance of $20,904 and $16,671 ...................................... 183,583 169,048
Deferred tax and other current assets ...................................................... 37,746 32,033
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Total current assets ................................................................... 506,638 504,878
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PROPERTY, PLANT AND EQUIPMENT, AT COST ........................................................ 1,263,446 1,250,494
Less -- Accumulated depreciation ........................................................... 701,006 682,048
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562,440 568,446
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GOODWILL, NET ................................................................................. 263,466 266,121
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OTHER ASSETS .................................................................................. 33,215 38,550
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$ 1,365,759 $ 1,377,995
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term debt and current portion of long-term debt ...................................... $ 4,547 $ 2,823
Accounts payable ........................................................................... 54,942 63,808
Accrued income taxes ....................................................................... 34,294 30,404
Other accrued liabilities .................................................................. 92,339 95,310
------------ ------------
Total current liabilities .............................................................. 186,122 192,345
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LONG-TERM DEBT ................................................................................ 210,452 209,124
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DEFERRED TAX LIABILITIES ...................................................................... 27,308 27,401
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OTHER LONG-TERM LIABILITIES ................................................................... 15,103 14,999
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STOCKHOLDERS' EQUITY:
Preferred stock, $1 par; shares authorized 1,000,000; none issued .......................... -- --
Common stock, $.10 par; shares authorized 80,000,000;
issued 52,770,441 and 52,701,964 ....................................................... 5,277 5,270
Paid-in capital ............................................................................ 653,898 652,378
Retained earnings .......................................................................... 343,703 313,216
Cumulative translation adjustment .......................................................... (25,576) (23,795)
Treasury stock, 1,367,478 and 322,667 common shares, at cost ............................... (50,528) (12,943)
------------ ------------
Total stockholders' equity ............................................................. 926,774 934,126
------------ ------------
$ 1,365,759 $ 1,377,995
============ ============
The accompanying notes are an integral part of these
consolidated financial statements.
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WEATHERFORD ENTERRA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
FOR THE THREE MONTHS
ENDED MARCH 31,
------------------------------
1998 1997
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REVENUES:
Services and rentals ............................... $ 196,453 $ 201,317
Products ........................................... 63,276 65,796
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Total revenues ................................. 259,729 267,113
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COSTS AND EXPENSES:
Cost of services and rentals ....................... 126,459 136,754
Cost of products ................................... 41,249 44,817
Selling, general and administrative expenses ....... 31,899 36,190
Research and development ........................... 2,038 2,774
Equity in earnings of unconsolidated affiliates .... (780) (509)
Foreign currency (gain) loss, net .................. (407) 393
Other expense, net ................................. 4,935 5,812
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Total costs and expenses ....................... 205,393 226,231
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OPERATING INCOME ...................................... 54,336 40,882
Interest expense ...................................... 4,018 6,134
Interest income ....................................... (480) (701)
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INCOME BEFORE INCOME TAXES ............................ 50,798 35,449
Income tax provision .................................. 20,311 12,497
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NET INCOME ............................................ $ 30,487 $ 22,952
============ ============
Basic earnings per common share ....................... $ 0.59 $ 0.44
============ ============
Diluted earnings per common share ..................... $ 0.59 $ 0.44
============ ============
Weighted average shares outstanding, basic ............ 51,610 52,242
============ ============
Weighted average shares outstanding, diluted .......... 51,886 52,567
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The accompanying notes are an integral part of these
consolidated financial statements.
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WEATHERFORD ENTERRA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1998
(UNAUDITED - IN THOUSANDS)
CUMULATIVE
COMMON PAID-IN RETAINED TRANSLATION TREASURY
STOCK CAPITAL EARNINGS ADJUSTMENT STOCK TOTAL
--------- --------- --------- --------- --------- ---------
BALANCE, DECEMBER 31, 1997 .............. $ 5,270 $ 652,378 $ 313,216 $ (23,795) $ (12,943) $ 934,126
Shares issued under employee
benefit plans ...................... -- 47 -- -- -- 47
Stock grants and options exercised ... 7 1,473 -- -- (157) 1,323
Purchases of treasury stock .......... -- -- -- -- (37,428) (37,428)
Currency translation adjustment ...... -- -- -- (1,781) -- (1,781)
Net income ........................... -- -- 30,487 -- -- 30,487
--------- --------- --------- --------- --------- ---------
BALANCE, MARCH 31, 1998 ................. $ 5,277 $ 653,898 $ 343,703 $ (25,576) $ (50,528) $ 926,774
========= ========= ========= ========= ========= =========
The accompanying notes are an integral part of these
consolidated financial statements.
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WEATHERFORD ENTERRA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED-IN THOUSANDS)
FOR THE THREE MONTHS
ENDED MARCH 31,
------------------------------
1998 1997
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NET INCOME .................................................................................... $ 30,487 $ 22,952
Income items not requiring (providing) cash:
Depreciation and amortization .............................................................. 29,207 27,378
Gain on sales of assets .................................................................... (3,473) (2,836)
Deferred income tax provision (benefit) .................................................... 87 453
Other non-cash charges ..................................................................... (136) 409
Increase (decrease) in cash from changes in operating accounts:
Receivables, net ....................................................................... (3,505) (20,150)
Inventories, net ....................................................................... (15,049) (11,476)
Prepayments and other .................................................................. 199 6,987
Accounts payable and accrued liabilities ............................................... (9,784) (3,560)
Other long-term liabilities ............................................................ 164 (748)
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CASH PROVIDED BY OPERATING ACTIVITIES ......................................................... 28,197 19,409
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Purchases of property, plant and equipment .................................................... (31,125) (23,018)
Proceeds from sales of property, plant and equipment .......................................... 6,297 7,503
Other net cash flows from investing activities ................................................ 3,928 305
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CASH USED IN INVESTING ACTIVITIES ............................................................. (20,900) (15,210)
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Borrowings under credit facilities ............................................................ 4,356 7,069
Repayment of borrowings ....................................................................... (762) (18,657)
Net cash flows from currency hedging transactions ............................................. 822 2,409
Purchases of treasury stock ................................................................... (37,428) --
Proceeds from sale of stock to employee benefit plans and stock
option exercises ........................................................................... 1,370 2,900
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CASH USED IN FINANCING ACTIVITIES ............................................................. (31,642) (6,279)
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EFFECT OF EXCHANGE RATE CHANGES ON CASH ....................................................... (685) (1,200)
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DECREASE IN CASH AND CASH EQUIVALENTS ......................................................... (25,030) (3,280)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ................................................ 42,348 33,029
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CASH AND CASH EQUIVALENTS, END OF PERIOD ...................................................... $ 17,318 $ 29,749
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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest ................................................................................... $ 157 $ 1,659
Income taxes, net of refunds received ...................................................... 7,323 3,970
The accompanying notes are an integral part of these
consolidated financial statements.
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WEATHERFORD ENTERRA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) The consolidated financial statements of Weatherford Enterra, Inc. and its
subsidiaries (the "Company" or "Weatherford") included herein have been prepared
by the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. In the opinion of management, the
information furnished reflects all adjustments, consisting only of normal
recurring adjustments, which are necessary for a fair presentation of the
results of the interim periods. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations. However, the Company believes that the disclosures are
adequate to make the information presented not misleading.
Certain reclassifications were made to previously reported amounts in the
consolidated financial statements and notes to make them consistent with the
current presentation format.
It is suggested that these financial statements be read in conjunction with
the financial statements and the notes thereto included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1997. No significant
accounting changes have occurred during the three months ended March 31, 1998.
See Note 5.
(2) EVI MERGER. On March 4, 1998, the Company entered into an Agreement and Plan
of Merger (the "Merger Agreement") providing for the merger of the Company into
EVI, Inc. ("EVI"). Pursuant to the terms of the Merger Agreement, Weatherford
stockholders will receive 0.95 of a share of EVI common stock for each share of
Weatherford Common Stock. The transaction, which is expected to be accounted for
as a pooling of interests and to result in no immediate federal income tax
recognition for the Company's stockholders, is subject to the approval of the
stockholders of each of EVI and Weatherford as well as other conditions to
closing. The transaction is expected to close on May 27, 1998. There can be no
assurance that this merger will be consummated.
(3) EARNINGS PER COMMON SHARE. In the fourth quarter of 1997, the Company
adopted Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings
per Share." Basic earnings per common share is computed by dividing net income
by the weighted average number of shares of Common Stock outstanding during the
period. Diluted earnings per common share also assume the exercise of employee
stock options under the treasury stock method.
A reconciliation of the numerators and the denominators of the basic and
diluted earnings per common share computation follows (in thousands except per
share amounts):
PER SHARE
NET INCOME SHARES AMOUNT
---------- ------ ---------
THREE MONTHS ENDED MARCH 31, 1998:
Basic earnings per common share . . . . . . . . . . . . . . . . $ 30,487 51,610 $ 0.59
Employee stock options . . . . . . . . . . . . . . . . . . . . . -- 276 =========
----------- ----------
Diluted earnings per common share . . . . . . . . . . . . . . . $ 30,487 51,886 $ 0.59
=========== ========== =========
THREE MONTHS ENDED MARCH 31, 1997:
Basic earnings per common share . . . . . . . . . . . . . . . . $ 22,952 52,242 $ 0.44
Employee stock options . . . . . . . . . . . . . . . . . . . . . -- 325 =========
----------- ----------
Diluted earnings per common share . . . . . . . . . . . . . . . $ 22,952 52,567 $ 0.44
=========== ========== =========
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(4) INVENTORIES. Consolidated net inventories consist of the following (in
thousands):
MARCH 31, DECEMBER 31,
1998 1997
------------ ------------
Spare parts and components ................................................... $ 44,572 $ 56,686
Raw materials ................................................................ 44,722 29,920
Work in process .............................................................. 22,390 19,904
Finished goods ............................................................... 71,899 62,538
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$ 183,583 $ 169,048
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(5) COMPREHENSIVE INCOME. In January 1998, the Company adopted SFAS No. 130,
"Reporting Comprehensive Income", which establishes standards for reporting and
financial statement display of comprehensive income. A reconciliation of net
income and comprehensive income of the Company follows (in thousands):
THREE MONTHS ENDED
MARCH 31,
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1998 1997
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Net income ................................................................... $ 30,487 $ 22,952
Change in cumulative translation adjustment .................................. (1,781) (9,185)
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Comprehensive income ......................................................... $ 28,706 $ 13,767
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