EXHIBIT 99.1
(NATIONAL OILWELL LOGO)
NEWS CONTACT: STEVE KRABLIN
(713) 346-7773
FOR IMMEDIATE RELEASE
NATIONAL OILWELL REPORTS THIRD QUARTER EARNINGS
HOUSTON, TX, October 28, 2003--National-Oilwell, Inc. (NYSE: NOI) reported net
income of $22.7 million ($0.27 per diluted share) for its third quarter ended
September 30, 2003.
Financial Results
(in millions, except per share amounts)
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<Caption>
Three Months Ended
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9/30/2003 6/30/2003 9/30/2002
------------ ------------ ------------
Revenues $ 498,600 $ 475,398 $ 366,929
Net Income $ 22,714 $ 20,360 $ 17,756
Diluted Earnings Per Share $ 0.27 $ 0.24 $ 0.22
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Revenues and operating income compare favorably sequentially and to the prior
year period. Contributing to these improvements are increased activity levels
and the successful integration of acquisitions made at the beginning of the
year.
Backlog of capital equipment at the end of the third quarter was $340 million
compared to $366 million at the end of the second quarter. Revenues from capital
equipment for the quarter totaled $147 million, down 5% from the prior quarter,
and incoming orders declined to $121 million from $153 million.
Capital spending was $6.3 million, compared to $7.8 for the second quarter of
the year and approximately 70% of the third quarter depreciation and
amortization charge.
PRODUCTS AND TECHNOLOGY GROUP
Products and Technology revenues and operating income increased by $7.2 and $4.0
million over the second quarter, led by improvements in downhole tools, drilling
spares and pump expendables. Operating income approximated 13% of revenues, as
favorable product mix led to strong incremental improvement for the quarter.
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DISTRIBUTION SERVICES GROUP
Improved land drilling activity throughout North America resulted in a $17.7
million revenue increase over the prior quarter. Operating income was negatively
impacted by product mix and higher operating costs. Operating margin
approximated 2.3% of revenues compared to 2.9% in the second quarter.
Pete Miller, President and CEO of National Oilwell, stated "Our non-capital
business continues to improve steadily, and this contributed to our best
quarterly results since 2001. While backlog and capital equipment orders can be
affected by our customers' various timing issues, we continue to see strong
global interest and the beginnings of the need for new capital equipment in
North America."
The Company has scheduled a conference call today at 10:00 a.m. Central Time to
discuss third quarter results. The call will be broadcast through the Investor
Relations link on National Oilwell's web site at www.natoil.com, and a replay
will be available on the site for thirty days following the conference.
Participants may also join the conference call by dialing 617-786-2962
(participant code: 51030388) five to ten minutes prior to the scheduled start
time.
National Oilwell is a worldwide leader in the design, manufacture and sale of
comprehensive systems and components used in oil and gas drilling and
production, as well as in providing supply chain integration services to the
upstream oil and gas industry.
Statements made in this press release that are forward-looking in nature are
intended to be "forward-looking statements" within the meaning of Section 21E of
the Securities Exchange Act of 1934 and may involve risks and uncertainties.
These statements may differ materially from actual future events or results.
Readers are referred to documents filed by National Oilwell with the Securities
and Exchange Commission, including the Annual Report on Form 10-K, which
identify significant risk factors which could cause actual results to differ
from those contained in the forward-looking statements.
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PAGE 3
The following table sets forth comparative data (in thousands, except per share
data):
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<Caption>
Quarter Ended QUARTER ENDED NINE MONTHS ENDED
June 30, SEPTEMBER 30, SEPTEMBER 30,
------------- ------------------------------ ------------------------------
2003 2003 2002 2003 2002
------------ ------------ ------------ ------------ ------------
Revenues
Products and Technology Group $ 311,464 $ 318,707 $ 213,067 $ 965,647 $ 679,162
Distribution Services Group 189,257 206,947 175,616 580,540 511,980
Eliminations (25,323) (27,054) (21,754) (71,613) (62,837)
------------ ------------ ------------ ------------ ------------
Total $ 475,398 $ 498,600 $ 366,929 $ 1,474,574 $ 1,128,305
Operating Income
Products and Technology Group $ 38,419 $ 42,390 $ 30,241 $ 122,641 $ 95,758
Distribution Services Group 5,499 4,757 4,508 14,972 13,790
Corporate (2,957) (3,306) (2,847) (9,383) (7,693)
------------ ------------ ------------ ------------ ------------
Total $ 40,961 $ 43,841 $ 31,902 $ 128,230 $ 101,855
Net Income $ 20,360 $ 22,714 $ 17,756 $ 62,240 $ 55,901
Average diluted shares outstanding 84,990 85,198 81,522 84,888 81,698
Net income per diluted share $ 0.24 $ 0.27 $ 0.22 $ 0.73 $ 0.68
Backlog for capital equipment at quarter end $ 366,000 $ 340,000 $ 231,000 $ 340,000 $ 231,000
Condensed Balance Sheet Data:
Cash and cash equivalents $ 62,153 $ 74,294
Other current assets 1,104,841 1,131,103
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Total current assets 1,166,994 1,205,397
Net property, plant and equipment 236,464 234,885
Other assets 710,761 713,574
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Total assets $ 2,114,219 $ 2,153,856
Current liabilities $ 372,342 $ 389,273
Long-term debt 593,265 585,258
Other long-term liabilities 84,975 84,676
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Total liabilities 1,050,582 1,059,207
Minority interest 12,641 13,643
Shareholders' equity 1,050,996 1,081,006
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Total liabilities and equity $ 2,114,219 $ 2,153,856
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