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EXHIBIT 99.1
WEATHERFORD ANNOUNCES THIRD QUARTER RESULTS
October 22, 1998, Houston, Texas - Weatherford International, Inc. (NYSE-WFT)
today announced income from continuing operations of $42.8 million or $.44 per
diluted share, on revenues of $482.5 million for the third quarter of 1998
compared to income from continuing operations of $53.7 million or $.55 per
diluted share, on revenues of $509.7 million for the third quarter of 1997.
Operating income for the third quarter of 1998 was $79.5 million compared to
$92.3 million for the third quarter of 1997.
The Company indicated that the results in the current quarter reflected the
impact of the global economic slowdown on the price of oil and customers'
decision to limit investments in exploration, drilling and production
activities. Performance was also impacted by severe weather in the Gulf of
Mexico during the quarter and severance costs associated with the elimination
of 1,200 jobs. The combination of weather-related activity disruptions and
severance costs accounted for an approximate $5 million after-tax, or $.05 per
diluted share impact on the quarterly results.
Income from continuing operations for the nine months ended September 30, 1998,
excluding one-time costs related to the merger of EVI, Inc. and Weatherford
Enterra, Inc. ($78 million or $.80 per diluted share after tax) recorded in the
second quarter of 1998, was $167.0 million or $1.71 per diluted share on
revenues of $1.6 billion compared to income from continuing operations of
$137.4 million or $1.41 per diluted share on revenues of $1.4 billion for the
nine months ended September 30, 1997.
COMPLETION AND OILFIELD SERVICES
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Operating income at the Company's Completion and Oilfield Services group was
$42.2 million in the current quarter, a 27% decrease from third quarter 1997
results. North American revenues decreased approximately 17% from 1997 to 1998
reflecting lower rig activity in the U.S. and Canada as well as the impact of
twenty-six days of activity disruption in the Gulf of Mexico due to tropical
storms. Results in the quarter were also impacted by severance and other costs
associated with the downsizing of North American operations in line with
current and anticipated activity. Partially offsetting the North American
weakness were strong results from operations in Middle East, North African and
Asia Pacific markets. The combination of these regions produced revenue
increases of 15% from year to year.
ARTIFICIAL LIFT SYSTEMS
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Third quarter 1998 operating income at the Company's Artificial Lift Systems
group decreased to $6.2 million from $10 million in the 1997 third quarter. The
decrease in operating income is attributable to the overall drop in worldwide
drilling and production activity with specific emphasis on oil markets in North
America. Partially offsetting the weakness in oil-related artificial lift
markets was a strong quarter from the group's gas compression business. Gas
compression operating margins increased to 10% in the 1998 period from 8.5%
last year as the Company implemented manufacturing cost reduction programs and
focused on the service business.
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DRILLING PRODUCTS
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Operating income at the Company's Drilling Products group increased 5% to $36.4
million on revenues of $162.4 million for the third quarter of 1998 from $34.6
million on revenues of $168.1 million for the third quarter of 1997. Total
shipments of drill stem products increased approximately 11% from the third
quarter of 1997 to the third quarter of 1998. Looking forward, the Company
expects that drill stem shipments will decrease approximately 400,000 feet in
each of the fourth quarter of 1998 and the first quarter of 1999 as the Company
aligns production levels with anticipated end-user demand. The increase in
third quarter drill stem volume and profitability was offset by a $37 million
decline in engineered connections and Premium tubular revenues. Premium
revenues are expected to increase modestly in the coming quarters as
distributors' inventory complete their adjustment to prevailing market
conditions.
Houston-based Weatherford International, Inc. is one of the largest
global providers of engineered products and services to the drilling and
production segments of the oil and gas industry.
Contact:
Don Galletly
Vice President
(713) 297-8466
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 concerning, among other things,
Weatherford's prospects for its operations and the integration of recent
acquisitions, all of which are subject to certain risks, uncertainties and
assumptions. These risks and uncertainties, which are more fully described in
Weatherford International, Inc.'s Annual, Quarterly and Current Reports filed
with the Securities and Exchange Commission, include the impact of oil prices
and worldwide economic conditions on drilling activity, the demand and pricing
of Weatherford's products, as well as the ability to achieve the anticipated
synergies and savings from the recent merger between EVI, Inc. and
Weatherford Enterra, Inc. Should one or more of these risks or uncertainties
materialize, or should the assumptions prove incorrect, actual results may vary
in material aspects from those currently anticipated.
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WEATHERFORD INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In 000's Except Per Share Amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
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1998 1997 1998 1997
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Net Revenues:
Completion and Oilfield Services $ 207,368 $ 222,504 $ 655,674 $ 616,423
Artificial Lift Systems 112,651 108,661 403,095 288,522
Drilling Products 162,435 168,091 527,978 436,173
Divestitures -- 10,462 -- 76,852
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482,454 509,718 1,586,747 1,417,970
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Operating Income:
Completion and Oilfield Services 42,249 58,560 153,592 148,770
Artificial Lift Systems 6,229 10,017 37,079 27,424
Drilling Products 36,436 34,576 127,105 82,538
Divestitures -- 715 -- 4,594
Corporate Expenses (5,437) (11,585) (20,822) (28,350)
Merger Costs and Other Charges -- -- (120,000) --
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79,477 92,283 176,954 234,976
Other Income (Expense):
Other, Net 1,023 626 4,357 8,064
Interest Expense (14,723) (10,125) (40,482) (31,273)
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Income Before Income Taxes 65,777 82,784 140,829 211,767
Provision For Income Taxes 23,023 29,058 51,823 74,397
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Net Income $ 42,754 $ 53,726 $ 89,006 $ 137,370
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Earnings Per Share:
Basic $ 0.44 $ 0.56 $ 0.92 $ 1.44
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Diluted $ 0.44 $ 0.55 $ 0.91 $ 1.41
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Weighted Average Shares Outstanding:
Basic 97,386 96,346 96,973 95,703
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Diluted 97,819 97,937 97,684 97,194
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Depreciation and Amortization:
Completion and Oilfield Services $ 23,817 $ 21,217 $ 68,861 $ 62,971
Artificial Lift Systems 10,740 7,581 32,403 22,224
Drilling Products 7,549 6,657 23,042 17,314
Divestitures -- 100 -- 1,541
Corporate 220 648 1,547 1,920
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$ 42,326 $ 36,203 $ 125,853 $ 105,970
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