Weatherford Announces First Quarter 2020 Results
HOUSTON, May 11, 2020 /PRNewswire/ -- Weatherford International plc ("Weatherford" or the "Company") announced today its results for the first quarter of 2020.
Note: Upon completing its financial restructuring in late 2019, the Company adopted fresh-start accounting resulting in Weatherford becoming a new entity for accounting and financial reporting purposes. As required by GAAP, results up to December 13, 2019 are presented separately as the predecessor period (the "Predecessor" period) and results from December 14, 2019 and onwards are presented as the successor period (the "Successor" period). The results from these Predecessor and Successor periods are not comparable. Nevertheless, for discussion purposes herein the Company has presented the results of the Predecessor and Successor periods and, for the fourth quarter of 2019, has combined the Predecessor and Successor results as a non-GAAP measure (the "combined" results), as we believe this provides the most meaningful basis to analyze our results.
On a GAAP basis, revenues for the first quarter of 2020 were $1.2 billion, a decline of 2% sequentially and 10% year-on-year. Reported operating loss was $822 million in the first quarter of 2020 compared to a combined operating loss of $315 million in the fourth quarter of 2019 and a loss of $301 million in the first quarter of 2019. The Company's first quarter 2020 net loss was $966 million, compared to a combined net income of $5.3 billion in the fourth quarter of 2019 and a net loss of $481 million in the first quarter of 2019. The combined fourth quarter 2019 period included a net reorganization gain of $5.7 billion. First quarter of 2020 cash flows from operations were $30 million and capital expenditures were $38 million. Weatherford had cash and cash equivalents of $670 million and over $235 million of availability under its senior secured asset-based revolving credit agreement (the "ABL Facility") as of March 31, 2020.
On a non-GAAP basis:
-- Revenues of $1.2 billion declined 2% sequentially and 7% year-on-year
(excluding divestitures) ([1])
-- International revenues declined 1% sequentially and grew 2%
year-on-year ([1])
-- North American revenues declined 4% sequentially and 23%
year-on-year ([1])
-- Adjusted EBITDA ([2][3]) of $178 million grew by 15% sequentially and
39% year-on-year and associated margins of 15% increased 221 basis
points sequentially and 514 basis points year-on-year
-- Free cash flow of negative $2 million ([2]) improved $94 million
sequentially and $280 million year-on-year, despite being burdened by
approximately $75 million of cash outflows associated with our financial
restructuring and prior period corporate development activities
Mark A. McCollum, President and Chief Executive Officer, commented, "I am encouraged by Weatherford's operating improvements as evidenced by our results during the first quarter of 2020, despite a challenging operating environment that continued to deteriorate as the quarter progressed.
"Notwithstanding these challenges, the Company's revenues increased in certain key markets and adjusted EBITDA and adjusted EBITDA margin increased meaningfully, on both a sequential and on a year-on-year basis. Our international business, which comprised over 70% of our first-quarter 2020 revenues, grew 2% year-on-year ([1]), with growth across the Middle East, Russia and Asia. In North America, first-quarter 2020 revenues declined 23% year-on-year ([1]) consistent with activity reductions in the United States and Canada.
"Adjusted EBITDA grew 15% sequentially during the first quarter of 2020 and 39% year-on-year, due to a combination of swift actions to reduce costs, favorable revenue mix and improved operating performance.
"Perhaps most importantly, Weatherford was free cash flow neutral during the quarter, an improvement of approximately $280 million year-on-year, despite being burdened by approximately $75 million of cash outflows that carried over from our financial restructuring and prior period corporate development activities.
"Our performance during the quarter is noteworthy, as the COVID-19 pandemic and actions by certain producing nations caused commodity prices to decline precipitously and created a number of internal and external operating challenges. I am proud of how quickly our organization adapted and I would like to extend my gratitude to the many members of our team working in the field and at our manufacturing sites. We are focused on the safety of our employees and their families and will continue to implement policies in-line with guidance from the World Health Organization and Centers for Disease Control and Prevention to protect our employees while continuing to serve the needs of our customers.
"As we look ahead to the second quarter of 2020, we are seeing a significant acceleration of the disruptions associated with the COVID-19 pandemic and global storage for crude oil will likely reach full capacity, further pressuring crude pricing and forcing producers to shut-in a significant amount of production globally. These factors are expected to continue to have an unprecedented impact on global oil and gas activity. Moreover, once supply and demand dynamics rebalance, it is unclear when a stable oil market will return, as record crude inventories will likely dampen the pace of any recovery.
"We currently expect there to be a multi-year dislocation across the industry, with the quickest and deepest impacts in North America, followed by certain international markets such as Europe, Latin America and Sub Saharan Africa.
"Against this outlook, we have more than doubled the cost savings actions that were underway going into 2020 and we will continue to adjust as required by market conditions. We are implementing a combination of structural reductions, headcount and pay reductions, furloughs, facility closures, capital expenditure reductions, and have consolidated our geographic, product line and support organizations.
"Weatherford's available liquidity increased to over $905 million at the end of the quarter, as neutral free cash flow was bolstered by a reduction in restricted cash. However, in the current operating environment it is critical that we address our capital structure."
Liquidity
The Company had over $905 million of available liquidity on March 31, 2020, comprised of cash and cash equivalents of $670 million and approximately $235 million available under its ABL Facility. As of March 31, 2020, Weatherford was fully compliant with the financial covenants under the ABL Facility and its senior secured letter of credit agreement.
However, as a result of the weak industry environment due to the COVID-19 pandemic, lower demand for hydrocarbons and activity declines, Weatherford is currently evaluating various alternatives to address the level of the Company's debt service and expected reductions in borrowing capacity under the ABL Facility.
Impairment and Restructuring Charges
In accordance with accounting guidelines, the Company is required to assess its goodwill, tangible and other intangible assets for impairment if events or changes in circumstances indicate the carrying value of the assets may not be recovered. Due to the challenging industry environment, management determined that impairment indicators existed and conducted an assessment resulting in impairment charges of $807 million during the first quarter of 2020. The charges are broken down as follows:
-- Goodwill: $167 million
-- Other intangible assets: $137 million
-- Right of use assets: $73 million
-- Property, plant, and equipment: $430 million
In addition, Weatherford recorded pre-tax restructuring charges of $26 million related to the Company's headcount reductions, facility consolidation, and other activities.
Notes:
([1] )Excludes the impact of Land Drilling Rigs and the Surface Logging Systems and Labs divestitures completed in 2019.
([2] )Adjusted EBITDA excludes, among other items, impairments on goodwill and long-lived assets. Free cash flow is calculated as cash flows provided by (used in) operating activities, less capital expenditures, plus proceeds from disposition of assets. Net debt is calculated as total short- and long-term debt less cash and cash equivalents and restricted cash. Adjusted EBITDA, free cash flow and net debt are non-GAAP measures. Each measure is defined and reconciled to the most directly comparable GAAP measure in the tables below.
([3]) In the first quarter of 2020 the Company began reporting adjusted EBITDA excluding the burden of stock-based compensation. Additional detail for the current and historical periods is provided in the tables below.
Operating Segments
Western Hemisphere
Successor Successor Predecessor Predecessor
Quarter Period From Period From Non-GAAP Quarter
Ended 12/14/19 to 10/01/19 to Combined Ended
($ in Millions) 3/31/20 12/31/19 12/13/19 Results 3/31/19
Revenues:
North America $
341 $
68 $
289 $
357 $
456
Latin America 247 53 211 264 270
Total Revenues $
588 $
121 $
500 $
621 $
726
Adjusted Segment
EBITDA $
76 $
10 $
54 $
64 $
58
% Margin 13 8 11 10
%
%
% % % 8
First-quarter 2020 Western Hemisphere revenues of $588 million decreased 5% sequentially and 19% year-on-year. Excluding the impact of divestitures ([1]), revenues declined 5% sequentially and 17% year-on-year. In North America, first-quarter 2020 revenues of $341 million declined 4% sequentially due to year-end product sales that did not repeat and lower drilling activity, which was partially offset by seasonal activity increases in Canada. First-quarter 2020 revenues of $247 million in Latin America declined 6% sequentially, driven primarily by the initial impacts of COVID-19-related activity reductions and year-end product sales that did not repeat.
First-quarter 2020 adjusted segment EBITDA of $76 million increased $12 million sequentially and associated margins of 13% increased by 260 basis points versus the combined fourth quarter of 2019. The sequential growth in adjusted EBITDA, despite the decline in revenue, was driven by favorable product mix as well as fixed and variable cost reductions in North America.
Eastern Hemisphere
Successor Successor Predecessor Predecessor
Quarter Period From Period From Non-GAAP Quarter
Ended 12/14/19 to 10/01/19 to Combined Ended
($ in Millions) 3/31/20 12/31/19 12/13/19 Results 3/31/19
Revenues:
Middle East,
North Africa &
Asia $
403 $
88 $
298 $
386 $
390
Europe, SSA &
Russia 224 52 187 239 230
Total Revenues $
627 $
140 $
485 $
625 $
620
Adjusted Segment
EBITDA $
127 $
30 $
84 $
114 $
93
% Margin 20 21 17 18 15
% % % % %
First-quarter 2020 Eastern Hemisphere revenues of $627 million were unchanged sequentially and grew 1% quarter-on-quarter. Excluding the impact of divestitures ([1]), revenues grew 2% sequentially and 6% year-on-year. First-quarter 2020 revenues in Middle East, North Africa and Asia of $403 million grew 4% sequentially, due to increased Artificial Lift and Completions product sales. First-quarter revenues in Europe, Sub Saharan Africa, and Russia of $224 million declined 6% sequentially, driven by primarily year-end product sales that did not repeat and seasonal activity slowdowns in Russia and the North Sea.
First-quarter 2020 adjusted segment EBITDA of $127 million increased $13 million sequentially and associated margins of 20% improved 210 basis points versus the combined fourth quarter of 2019. The sequential increase in adjusted EBITDA was primarily driven by favorable product mix and fixed cost reductions.
Customer & Technology Highlights
-- A major national oil company in the Middle East awarded Weatherford a
contract for the customer's first-ever real-time drilling decision
center. The project will rely on the recently-launched Centro((TM))
integrated realtime environment and further expands the Company's
digital presence.
-- In the United States, Weatherford secured an order for over 40 surface
pumping units, reaffirming its position as the single-source
artificial-lift provider for an operator in the Bakken region. The
Company's footprint and experience in the region enabled Weatherford to
develop a solution that will offer a 15% operational cost savings per
production system. Weatherford will provide the operator a complete
system from surface to wellbore, including piles, rods, services, and
pumps.
-- The Weatherford Interpretation and Evaluation Services, or IES, group
supported the first microseismic monitoring operation in Turkey during a
one-stage hydraulic fracturing job. The operation included well modeling
and planning and the acquisition and interpretation of microseismic
fracturing data. Weatherford IES experts enabled the customer to
optimize their fracturing program and select the best gel treatments for
the production stimulation program and enabled the Company to expand its
operations with the customer.
-- The Victus((TM)) intelligent managed pressure drilling (MPD) system was
fully integrated on a drilling unit offshore Azerbaijan and is currently
on standby. MPD operations are scheduled to begin in late April, with
the connection of our Gen II intelligent riser and MPD drilling
thereafter. The Victus((TM)) system enhances safety (by eliminating the
need for manual work in the moon pool area) and accelerates rig-up and
rig-down times by up to 80% (by using an integrated connection hub for
subsea control lines).
-- Weatherford was awarded a contract to provide logging-while-drilling
(LWD) measurement-while-drilling (MWD), drilling, and geo-data
interpretation services in Russia. The contract will span three years
and showcases the Company's expanding footprint in the region.
Additionally, Weatherford will deploy its Magnus(®) rotary steerable
solution to support these operations, continuing to accelerate
Magnus'(®) expansion into international markets.
-- Weatherford achieved 1,000 days without lost-time incidents for its
Offshore Shallow Waters Integrated Service Project, highlighting
Weatherford's commitment to safety and service quality.
About Weatherford
Weatherford is the leading wellbore and production solutions company. Operating in more than 80 countries, the Company answers the challenges of the energy industry with its global talent network of approximately 20,000 team members and 600 locations, which include service, research and development, training, and manufacturing facilities. Visit https://www.weatherford.com/ for more information or connect on LinkedIn, Facebook, Twitter, Instagram, or YouTube.
Contact
Sebastian Pellizzer
Senior Director, Investor Relations
+1 713-836-6777
investor.relations@weatherford.com
Forward-Looking Statements
This news release contains forward-looking statements concerning, among other things, the Company's quarterly and full-year non-GAAP earnings (loss) per share, effective tax rate, net debt, forecasts or expectations regarding business outlook, and capital expenditures, and are also generally identified by the words "believe," "project," "expect," "anticipate," "estimate," "outlook," "budget," "intend," "strategy," "plan," "guidance," "may," "should," "could," "will," "would," "will be," "will continue," "will likely result," and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of Weatherford's management and are subject to significant risks, assumptions, and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Readers are also cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results, including the extent or duration of business interruptions associated with COVID-19, the price and price volatility of oil and natural gas, the macroeconomic outlook for the oil and gas industry, the duration and severity of the impact of the COVID-19 pandemic on oil and gas demand and commodity prices, our ability to generate cash flow from operations to fund our operations, the outcome of any discussions with our bondholders regarding the terms of a potential restructuring of our indebtedness or a recapitalization of the Company, realization of additional cost savings and operational efficiencies and potential logistical issues and potential non-cash asset impairment charges for long-lived assets, intangible assets or other assets. Forward-looking statements are also affected by the risk factors described in the Company's Annual Report on Form 10-K for the year ended December 31, 2019, the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, and those set forth from time-to-time in the Company's other filings with the Securities and Exchange Commission. We undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.
Weatherford International plc
Quarterly Condensed Consolidated Statements of Operations (Unaudited)
($ in Millions, Except Per Share Amounts)
Successor Successor Predecessor Predecessor
Quarter Period From Period From Non-GAAP Quarter
Ended 12/14/19 to 10/1/19 to Combined Ended
03/31/20 12/31/19 12/13/19 Results 03/31/19
---
Revenues:
Western Hemisphere $
588 $
121 $
500 $
621 $
726
Eastern Hemisphere 627 140 485 625 620
Total Revenues 1,215 261 985 1,246 1,346
Operating Income (Loss):
Western Hemisphere 29 (4) 19 15 9
Eastern Hemisphere 18 10 30 40 20
Segment Operating Income 47 6 49 55 29
Corporate Expenses (26) (5) (23) (28) (32)
Goodwill Impairment (167) (229)
Restructuring Charges (26) (96) (96) (20)
Prepetition Charges - (10)
Other Charges, Net (650) (246) (246) (39)
Total Operating Income
(Loss) (822) 1 (316) (315) (301)
Other Income (Expense):
Reorganization Items (9) (4) 5,692 5,688
Interest Expense, Net (58) (12) (21) (33) (155)
Other Non-Operating
Expenses, Net (25) (8) (8) (9)
Net Income (Loss) Before
Income Taxes (914) (15) 5,347 5,332 (465)
Income Tax Provision (44) (9) (59) (68) (12)
Net Income (Loss) (958) (24) 5,288 5,264 (477)
Net Income Attributable
to Noncontrolling
Interests 8 2 9 11 4
Net Income (Loss)
Attributable to
Weatherford $
(966) $
(26) $
5,279 $
5,253 $
(481)
Income (Loss) Per Share Attributable to
Weatherford:
Basic and Diluted $
(13.80) $
(0.37) $
5.26 n/a $
(0.48)
Weighted Average Shares Outstanding:
Basic and Diluted 70 70 1,004 n/a 1,003
Weatherford International plc
Selected Balance Sheet Data (Unaudited)
($ in Millions)
03/31/2020 12/31/19
---
Assets:
Cash and Cash
Equivalents 670 $
618
Restricted Cash 94 182
Accounts Receivable,
Net 1,204 1,241
Inventories, Net 1,004 972
Property, Plant and
Equipment, Net 1,554 2,122
Goodwill 72 239
Intangibles, Net 928 1,114
Liabilities:
Accounts Payable 544 585
Short-term Borrowings
and Current Portion
of Long-term Debt 26 13
Long-term Debt 2,149 2,151
Shareholders' Equity:
Total Shareholders'
Equity 1,863 2,916
Components of Net Debt [1]:
Short-term Borrowings
and Current Portion
of Long-term Debt 26 13
Long-term Debt 2,149 2,151
Less: Cash and Cash
Equivalents 670 618
Less: Restricted Cash 94 182
Net Debt [1] 1,411 1,364
[1] Net debt is a non-GAAP
measure calculated as total
short- and long-term debt
less cash and cash
equivalents and restricted
cash.
Weatherford International plc
Condensed Consolidated Statement of Cash Flows (Unaudited)
($ in Millions)
Successor Predecessor
Quarter Quarter
Ended Ended
3/31/2020 3/31/19
Cash Flows From Operating
Activities:
Net Income (Loss) $
(958) $
(477)
Adjustments to Reconcile Net
Income (Loss) to Net Cash Used
in Operating Activities:
Depreciation and Amortization 157 123
Goodwill Impairment 167 229
Long-Lived Asset Impairments
and Other 648 31
Working Capital [1] (83) (47)
Other Operating Activities 99 (108)
Total Cash Flows Provided by
(Used in) Operating Activities 30 (249)
Cash Flows From Investing
Activities:
Capital Expenditures for
Property, Plant and Equipment (38) (59)
Proceeds from Disposition of
Assets 6 26
Proceeds from Disposition of
Businesses, Net (1) 74
Other Investing Activities (14) (5)
Net Cash Provided by (Used in)
Investing Activities (47) 36
Cash Flows From Financing
Activities:
Repayments of Long-term Debt (2) (15)
Borrowings (Repayments) of
Short-term Debt, Net (3) 228
Other Financing Activities, Net (3) (5)
Net Cash Provided by (Used in)
Financing Activities (8) 208
Free Cash Flow [2]:
Cash Flows Provided by (Used in)
Operating Activities $
30 $
(249)
Capital Expenditures for
Property, Plant and Equipment (38) (59)
Proceeds from Disposition of
Assets 6 26
Free Cash Flow [2] $
(2) $
(282)
[1] Working capital is defined as the
cash changes in accounts receivable
plus inventory less accounts
payable.
[2] Free cash flow is a non-GAAP measure
calculated as cash flows provided by
(used in) operating activities less
capital expenditures for property,
plant and equipment plus proceeds
from disposition of assets.
Management believes free cash flow
is useful to understand liquidity
and should be considered in addition
to but not substitute cash flows
provided by (used in) operating
activities.
Weatherford International plc
Quarterly Selected Statements of Operations Information (Unaudited)
($ in Millions)
Successor Successor Predecessor
Predecessor
---
Quarter Period From Period From Non-GAAP
Quarter
Ended 12/14/19 to 10/01/19 to Combined
Ended
3/31/20 12/31/19 12/13/19 Results 9/30/19 6/30/19 3/31/19
---
Revenues
Western Hemisphere $
588 $
121 $
500 $
621 $
675 $
719 $
726
Eastern Hemisphere 627 140 485 625 639 590 620
Total Revenues $
1,215 $
261 $
985 $
1,246 $
1,314 $
1,309 $
1,346
Adjusted EBITDA
Western Hemisphere $
76 $
10 $
54 $
64 $
60 $
57 $
58
Eastern Hemisphere 127 30 84 114 145 99 93
Adjusted Segment
EBITDA(a) (b) 203 40 138 178 205 156 151
Corporate and Other (25) (5) (18) (23) (26) (27) (23)
Total Adjusted EBITDA $
178 $
35 $
120 $
155 $
179 $
129 $
128
Operating Income (Loss)
Western Hemisphere $
29 $
(4) $
19 $
15 $
15 $
11 $
9
Eastern Hemisphere 18 10 30 40 56 28 20
Segment Operating
Income 47 6 49 55 71 39 29
Corporate Expenses (26) (5) (23) (28) (31) (32) (32)
Goodwill Impairment (167) (399) (102) (229)
Restructuring Charges (26) (96) (96) (53) (20) (20)
Prepetition Charges - (76) (10)
Gain on Sale of
Operational Assets - 15
Other Charges, Net (650) (246) (246) (50) 73 (39)
Total Operating Income
(Loss) $
(822) $
1 $
(316) $
(315) $
(447) $
(118) $
(301)
Depreciation and Amortization
Western Hemisphere $
47 $
14 $
34 $
48 $
44 $
45 $
48
Eastern Hemisphere 109 20 54 74 73 70 72
Corporate 1 2 2 1 1 3
Total Depreciation and
Amortization $
157 $
34 $
90 $
124 $
118 $
116 $
123
Stock-Based Compensation (b)
Western Hemisphere
$
$ $
1 $
1 $
1 $
1 $
1
Eastern Hemisphere - 1 1 1
Corporate - 3 3 4 4 6
Stock-Based
Compensation
$
$ $
4 $
4 $
6 $
6 $
8
Product Line (c
)
Revenues
Production $
353 $
82 $
298 $
380 $
392 $
382 $
399
Completion 314 66 225 291 286 303 306
Drilling and Evaluation 281 57 226 283 320 311 336
Well Construction 267 56 236 292 316 313 305
Total Product Line
Revenues $
1,215 $
261 $
985 $
1,246 $
1,314 $
1,309 $
1,346
(a) Includes the $15 million gain on
sale operational asset in the third
quarter of 2019.
(b) In the first quarter of 2020 the
Company began reporting adjusted
EBITDA excluding the burden of
stock-based compensation.
Historical periods have been
restated to reflect this
methodology.
(c) Production includes Artificial Lift
Systems, Stimulation and Testing
and Production Services.
Completions includes Completion
Systems, Liner Systems and
Cementing Products. Drilling and
Evaluation includes Drilling
Services, Managed Pressure
Drilling, and Wireline Services.
Well Construction includes Tubular
Running Services, Intervention
Services, and Drilling Tools and
Rental Equipment.
We report our financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, Weatherford's management believes that certain non-GAAP financial measures and ratios (as defined under the SEC's Regulation G and Item 10(e) of Regulation S-K) may provide users of this financial information additional meaningful comparisons between current results and results of prior periods and comparisons with peer companies. The non-GAAP amounts shown in the following tables should not be considered as substitutes for operating income, provision for income taxes, net income or other data prepared and reported in accordance with GAAP, but should be viewed in addition to the Company's reported results prepared in accordance with GAAP.
Weatherford International plc
Quarterly Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
($ in Millions, Except Per Share Amounts)
Successor Successor Predecessor
Predecessor
Quarter Period From Period From Non-GAAP
Quarter
Ended 12/14/19 to 10/1/19 to Combined
Ended
3/31/20 12/31/19 12/13/19 Results 9/30/19 6/30/19 3/31/19
---
Operating Income (Loss):
GAAP Operating Income
(Loss) $
(822) $
1 $
(316) $
(315) $
(447) $
(118) $
(301)
Goodwill Impairment (a) 167 399 102 229
Restructuring Charges
(b) 26 96 96 53 20 20
Long-lived Assets
Impairment and Other
(c) (d) 650 254 254 42 41 37
Prepetition Charges - 76 10
Gain on Sale of
Operational Assets - (15)
(Gain) Loss on Sale of
Business - (8) (8) 8 (114) 2
Operating Non-GAAP
Adjustments 843 342 342 487 125 298
Non-GAAP Adjusted
Operating Income $
21 $
1 $
26 $
27 $
40 $
7 $
(3)
Income (Loss) Before Income Taxes:
GAAP Income (Loss)
Before Income Taxes $
(914) $
(15) $
5,347 $
5,332 $
(784) $
(279) $
(465)
Operating Non-GAAP
Adjustments 843 342 342 487 125 298
Reorganization Items (e) 9 4 (5,692) (5,688) 303
Non-GAAP Adjustments
Before Taxes 852 4 (5,350) (5,346) 790 125 298
Non-GAAP Loss Before
Income Taxes $
(62) $
(11) $
(3) $
(14) $
6 $
(154) $
(167)
Benefit (Provision) for Income Taxes:
GAAP Benefit (Provision)
for Income Taxes (44) (9) (59) $
(68) $
(31) $
(33) $
(12)
Tax Effect on Non-GAAP
Adjustments (7) 24 24 (4) 2 (8)
Non-GAAP Provision for
Income Taxes $
(51) $
(9) $
(35) $
(44) $
(35) $
(31) $
(20)
Net Income (Loss) Attributable to
Weatherford:
GAAP Net Income (Loss) $
(966) $
(26) $
5,279 $
5,253 $
(821) $
(316) $
(481)
Non-GAAP Adjustments,
net of tax 845 4 (5,326) (5,322) 786 127 290
Non-GAAP Net Loss $
(121) $
(22) $
(47) $
(69) $
(35) $
(189) $
(191)
Diluted Income (Loss) Per Share
Attributable to Weatherford:
GAAP Diluted Income
(Loss) per Share $
(13.80) $
(0.37) $
5.26
n/a $
(0.82) $
(0.31) $
(0.48)
Non-GAAP Adjustments,
net of tax 12.07 0.06 (5.31)
n/a 0.79 0.12 0.29
Non-GAAP Diluted Loss
per Share $
(1.73) $
(0.31) $
(0.05)
n/a $
(0.03) $
(0.19) $
(0.19)
(a) Represents goodwill impairment
after a fair value assessment of
our business and assets for the
periods presented.
(b) Represents restructuring,
facility consolidation and
severance costs for the periods
presented.
(c) Primarily included a long-lived
assets impairment after a fair
value assessment of our business
and assets in the first quarter
of 2020.
(d) Primarily included asset write-
downs and inventory charges,
partially offset by a gain on
purchase of a joint venture
remaining interest in the
predecessor prior quarter.
(e) Primarily from the gain on
settlement of liabilities
subject to compromise and fresh
start valuation adjustments in
the fourth quarter of 2019 and
unamortized debt issuance and
other fees in the third quarter
of 2019.
Weatherford International plc
Quarterly Reconciliation of GAAP to Non-GAAP Financial Measures - EBITDA (Unaudited)
($ in Millions)
Successor Successor Predecessor
Predecessor
---
Quarter Period From Period From Non-GAAP
Quarter
Ended 12/14/19 to 10/1/19 to Combined
Ended
3/31/20 12/31/19 12/13/19 Results 9/30/19 6/30/19 3/31/19
---
Net Income (Loss)
Attributable to
Weatherford $
(966) $
(26) $
5,279 $
5,253 $
(821) $
(316) $
(481)
Net Income Attributable to
Noncontrolling Interests 8 2 9 11 6 4 4
Net Income (Loss ) (958) (24) 5,288 5,264 (815) (312) (477)
Interest Expense, Net 58 12 21 33 26 160 155
Income Tax Provision 44 9 59 68 31 33 12
Depreciation and
Amortization 157 34 90 124 118 116 123
EBITDA (699) 31 5,458 5,489 (640) (3) (187)
Other (Income) Expense Adjustments:
Reorganization Items 9 4 (5,692) (5,688) 303
Goodwill Impairment 167 399 102 229
Long-lived Asset
Impairments and Other 650 254 254 42 41 37
Restructuring Charges 26 96 96 53 20 20
Prepetition Charges - 76 10
(Gain) Loss on Sale of
Business - (8) (8) 8 (114) 2
Stock-Based Compensation
[1] - 4 4 6 6 8
Other Non-Operating
Expense, Net 25 8 8 8 1 9
Adjusted EBITDA $
178 $
35 $
120 $
155 $
179 $
129 $
128
[1] In the first quarter of 2020 the
Company began reporting adjusted
EBITDA excluding the burden of
stock-based compensation.
Historical periods have been
restated to reflect this
methodology.
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SOURCE Weatherford International plc
