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EXHIBIT 99.2
WEATHERFORD REPORTS THIRD QUARTER RESULTS
- EARNINGS INCREASE 612 PERCENT -
HOUSTON, October 24, 2000 - - Weatherford International, Inc. (NYSE: WFT) today
reported third quarter income from continuing operations of $21.5 million ($0.19
per diluted share), an improvement of 612 percent over the prior year result of
$3.0 million ($0.03 per diluted share). Third quarter cash earnings (after-tax
earnings, excluding goodwill amortization, net of tax) were $29.7 million ($0.26
per diluted share), or 276 percent higher than the prior year. Net income in the
quarter, also $0.19 per diluted share, compared favorably to the prior year net
loss of $0.11 per diluted share. Revenue for the third quarter of $462.2 million
was 43 percent higher than the prior year level of $323.6 million.
Sequentially, the company's third quarter performance improved over the
second quarter with revenue, operating income and EBITDA up 10 percent, 29
percent and 15 percent, respectively.
Weatherford's financial performance reflected increasing worldwide levels
of oil and natural gas drilling and production activity. In North America, rig
activity increased 23 percent over the second quarter reflecting the seasonal
recovery in Canada and continuing growth in the United States. International rig
activity, still in the early phases of recovery, rose 10 percent. The company
also continues to benefit from the contribution of products and services added
through acquisition and internal development initiatives. Factors moderating
results in the quarter included weakness in the European Euro and British Pound,
and lower than expected rig count in Canada due to unseasonably wet weather.
During the quarter, Weatherford efforts were underway to increase capacity to
provide services and products in anticipation of continuing improvement in
worldwide demand.
For the first nine months, earnings per diluted share from continuing
operations were $0.40 versus $0.09 per diluted share in the prior year. Revenues
of $1,279.4 million and operating income of $107.6 million were 47 percent and
148 percent higher than the prior year, respectively.
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WEATHERFORD DRILLING & INTERVENTION SERVICES
Revenues for Weatherford Drilling & Intervention Services division in the third
quarter were $225.0 million, 58 percent higher than the prior year and 9 percent
higher than the preceding quarter. Operating income of $41.8 million was 180
percent higher than the prior year and 8 percent higher than the preceding
quarter. EBITDA of $68.0 million was 80 percent higher than the prior year and 7
percent higher than the preceding quarter.
Sequentially, Weatherford's service and product lines delivered improving
performances. Higher revenues in the U.S., Canada, Europe and Latin America were
somewhat offset by lower revenues in Asia and the Middle East. During the
quarter, this division introduced price increases of approximately 10 percent,
which are expected to positively affect results in the fourth quarter.
Sequential incremental EBITDA margins varied significantly by region in the
quarter. In North America, incremental EBITDA margins were 52 percent driven by
increased volume. Europe also experienced higher volume and a strong sequential
incremental margin. These positive results were offset by lower incrementals in
Latin America due largely to a build up in anticipation of higher Brazilian
activity, as well as flat or slightly down revenues in Africa, the Middle East
and Asia.
WEATHERFORD COMPLETION SYSTEMS
Weatherford Completion Systems division revenues of $57.3 million were 68
percent higher than the prior year and 23 percent higher than the preceding
quarter. Operating income of $0.8 million was better than the losses of $4.8
million last year and $4.4 million in the preceding quarter. EBITDA of $7.6
million was better than a loss of $1.2 million last year and more than four
times better than the $1.8 million of EBITDA in the preceding quarter.
Sequentially, the performance in the quarter was led by a 39 percent
sequential improvement in North American revenues. In addition, output from the
recently consolidated Eastern Hemisphere manufacturing facilities increased
nearly 90 percent. Sales of all sand control products, including the innovative
Expandable Sand Screen (ESS(TM)) and the recently acquired Stratapac line,
increased more than 50 percent. During the quarter the company continued to add
manufacturing capacity and personnel to handle expected increases in future
activity.
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WEATHERFORD ARTIFICIAL LIFT SYSTEMS
Revenues for this division in the third quarter of $110.8 million increased 41
percent over the prior year and 6 percent over the preceding quarter. Operating
income of $11.0 million in the quarter was 85 percent better than the prior year
and 23 percent better than the preceding quarter. EBITDA of $17.4 million
increased 59 percent over the prior year and 15 percent over the preceding
quarter.
Sequentially, Weatherford Artificial Lift Systems generated substantial
revenue gains in its reciprocating and progressing cavity pump (PCP) product
lines reflecting higher demand and improving prices for production equipment
particularly in Canada. Activity in Latin America also improved with revenues
increasing 14 percent sequentially.
On a year-to-year basis, revenues for reciprocating lift products and PCPs
each increased more than 55 percent.
WEATHERFORD GLOBAL COMPRESSION SERVICES
Revenues for the Compression Services division of $69.0 million increased
slightly over the prior year and 7 percent over the preceding quarter. Operating
income of $1.1 million was 84 percent below the prior year and 87 percent higher
than the preceding quarter. EBITDAR (earnings before interest, taxes,
depreciation, amortization and rental expenses) of $16.9 million declined 11
percent from the prior year and increased 11 percent above the preceding
quarter.
The performance in the quarter, while sequentially better than the results
of the second quarter, was impacted by the late startup of a project in the Far
East and slower-than-expected realization of cost savings from restructuring
efforts. Both factors, the Far Eastern project and cost savings, are expected to
benefit future quarters.
Houston-based Weatherford International, Inc. (HTTP://WWW.WEATHERFORD.COM)
is one of the largest global providers of innovative mechanical solutions,
technology and services for the drilling and production sectors of the oil and
gas industry. Weatherford operates in over 50 countries and employs
approximately 10,000 people worldwide.
# # #
Contact:
Don Galletly (713) 693-4148
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This press release may contain 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 and
natural gas prices and worldwide economic conditions on drilling activity and
the demand for and pricing of Weatherford's products. 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)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ------------------------
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net Revenues:
Drilling and Intervention Services $ 225,038 $ 142,794 $ 619,315 $ 422,158
Completion Systems 57,338 34,167 151,503 80,501
Artificial Lift Systems 110,840 78,740 315,292 198,438
Compression Services 68,954 67,931 193,290 166,464
--------- --------- --------- ---------
462,170 323,632 1,279,400 867,561
--------- --------- --------- ---------
Operating Income (Loss):
Drilling and Intervention Services 41,756 14,898 111,410 52,580
Completion Systems 811 (4,761) (8,699) (15,661)
Artificial Lift Systems 10,992 5,955 28,239 7,782
Compression Services 1,137 7,122 3,970 16,794
Corporate Expenses (9,687) (5,585) (27,353) (18,150)
--------- --------- --------- ---------
45,009 17,629 107,567 43,345
Other Income (Expense):
Other, Net (368) (672) 193 1,485
Interest Income 5,269 427 8,781 2,528
Interest Expense (15,818) (11,019) (45,360) (31,917)
--------- --------- --------- ---------
Income Before Income Taxes 34,092 6,365 71,181 15,441
Provision for Income Taxes (12,442) (1,848) (25,626) (3,903)
--------- --------- --------- ---------
Income Before Minority Interest 21,650 4,517 45,555 11,538
Minority Interest Expense, Net of Taxes (127) (1,495) (835) (2,821)
--------- --------- --------- ---------
Net Income from Continuing Operations 21,523 3,022 44,720 8,717
Loss from Discontinued Operations, Net of Taxes -- (14,115) (3,458) (19,292)
--------- --------- --------- ---------
Net Income (Loss) $ 21,523 $ (11,093) $ 41,262 $ (10,575)
========= ========= ========= =========
Basic Earnings (Loss) Per Share:
Income from Continuing Operations $ 0.20 $ 0.03 $ 0.41 $ 0.09
Loss from Discontinued Operations -- (0.14) (0.03) (0.20)
--------- --------- --------- ---------
Net Income (Loss) Per Share $ 0.20 $ (0.11) $ 0.38 $ (0.11)
========= ========= ========= =========
Basic Weighted Average Shares Outstanding 109,792 101,408 109,147 98,770
========= ========= ========= =========
Diluted Earnings (Loss) Per Share:
Income from Continuing Operations $ 0.19 $ 0.03 $ 0.40 $ 0.09
Loss from Discontinued Operations -- (0.14) (0.03) (0.19)
--------- --------- --------- ---------
Net Income (Loss) Per Share $ 0.19 $ (0.11) $ 0.37 $ (0.10)
========= ========= ========= =========
Diluted Weighted Average Shares Outstanding 114,500 103,481 112,908 100,306
========= ========= ========= =========
Other Information:
Cash Earnings Per Diluted Share from Continuing Operations $ 0.26 $ 0.08 $ 0.61 $ 0.22
========= ========= ========= =========
Depreciation and Amortization:
Drilling and Intervention Services $ 26,205 $ 22,900 $ 77,197 $ 70,265
Completion Systems 6,743 3,595 19,340 8,305
Artificial Lift Systems 6,438 5,024 18,478 14,694
Compression Services 10,057 8,459 28,907 25,193
Corporate 839 639 2,417 1,511
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$ 50,282 $ 40,617 $ 146,339 $ 119,968
========= ========= ========= =========
</TABLE>
