Halliburton Announces Second Quarter 2021 Results
- Net income of
$0.26 per diluted share - Cash flow from operating activities of
$409 million and free cash flow of$265 million
“Our second quarter performance demonstrates that our strategy is working well and Halliburton’s strategic priorities are driving value in this transition year. Total company revenue increased 7% sequentially, as both
“Halliburton’s Completion and Production division margin reached three-year highs, while our Drilling and Evaluation division margin outperformed expectations, setting both divisions up for robust margin growth this year.
“Our solid free cash flow generation further demonstrates the effectiveness of our strategy to strengthen the cash flow profile of our business.
“The positive activity momentum we see in
“Halliburton’s value proposition, unique exposure to both international and
Operating Segments
Completion and Production
Completion and Production revenue in the second quarter of 2021 was
Drilling and Evaluation
Drilling and Evaluation revenue in the second quarter of 2021 was
Geographic Regions
International
International revenue in the second quarter of 2021 was
Selective Technology & Highlights
- Halliburton announced StrataXaminer™, a new wireline logging service that helps operators acquire more accurate well data to better evaluate production potential. Obtaining high resolution images in oil or synthetic-based fluid systems has been an industry challenge for decades. StrataXaminer delivers high-resolution images of the reservoir structure to identify bedding, fracture patterns, fault zones, and potential flow barriers with increased accuracy.
- Halliburton and TGS-NOPEC Geophysical ASA announced a collaboration to bring advanced seismic imaging to fiber optic sensing. The alliance will provide operators with advanced insight to determine their reservoir potential for oil and gas production or carbon storage. The Halliburton FiberVSP™ and Odassea™ distributed acoustic sensing solutions will now incorporate TGS’s seismic imaging workflows that process the entire seismic wavefield to generate high-resolution reservoir images.
- Halliburton was awarded a contract from
Kuwait Oil Company (KOC), a world leader in digital transformation, to expand KOC’s digital transformation journey by implementing solutions to maximize operational efficiency and increase production. The scope applies to allKuwait fields includingWest Kuwait , South andEast Kuwait , and Heavy Oil, complementing a recently awarded contract for similar services inNorth Kuwait .
Halliburton Labs announced four new companies that join four companies already participating in its collaborative environment to advance and scale cleaner, affordable energy. Alumina Energy, Ionada, Parasanti, and SurgePower Materials receive access to a broad range of industrial capabilities, technical expertise, and mentorship to scale their businesses.
- Halliburton announced it will redeem, with cash on hand, the remaining
$500 million outstanding principal amount of its 3.25% Senior Notes due 2021 onAugust 15, 2021 .
- Halliburton was awarded a contract from
Petronas for a well construction program involving six wells in offshoreEast Malaysia . Halliburton will deliver these wells in collaboration with Sapura Drilling using its state-of-the-art Halliburton 4.0 digital platform. Deployed digital technologies will include the complete suite of Digital Well Program®, Digital Well Operations, and Digital Well Automation - all DecisionSpace® 365 cloud applications. The scope of work also includes key digital technologies fromSperry Drilling , Cementing, Drill Bits, Baroid, and Completions product lines. The campaign is the first integrated project of its kind inMalaysia , combining rig services with all aspects of planning, operations, and automation.
- Halliburton was awarded a contract from Ecopetrol to collaborate on their digital transformation strategy for drilling and completions, including the digitalization of the well delivery process. This enables Ecopetrol to optimize their planning, design, and well execution end-to-end and accelerate value creation across the asset lifecycle.
- Halliburton announced that it won a contract to provide Production Chemicals and Associated Services for a large
IOC inOman . Under the seven-year contract, Halliburton will supply a full suite of customized products along with specialized services to support the in-field chemical treatments.
- TechnipFMC and Halliburton announced they received an OTC Spotlight on New Technology Award® (SONT) for their Odassea™ Subsea Fiber Optic Solution, an advanced downhole fiber optic sensing system. ExxonMobil selected the solution for its Payara development project in
Guyana . The award followed completion of front-end engineering and design studies and qualifications. The Odassea service integrates hardware and digital systems to strengthen capabilities in subsea reservoir monitoring and production optimization. Halliburton provides the fiber optic sensing technology and analysis for reservoir diagnostics. TechnipFMC provides the optical connectivity from the topside to the completions.
- Halliburton announced an expansion of its digital collaboration with Aker BP, a Norwegian oil and gas exploration and production company, by deploying digital twins to automate work processes and accelerate decision-making. Aker BP is using Digital Well Program®, a DecisionSpace® 365 cloud application, that turns well planning and design into a live process where field development scenarios are continuously updated and compared to a digital twin to deliver safe, cost-effective, and productive wells.
- Halliburton signed a contract with Petrofac, an international service provider to the energy industry, to adopt Digital Well Program®, a DecisionSpace® 365 cloud application, to automate drilling, completions, and engineering processes. The three-year contract enables Petrofac to incorporate artificial intelligence, machine learning, and data science to optimize its well engineering service offering.
About Halliburton
Founded in 1919, Halliburton is one of the world's largest providers of products and services to the energy industry. With more than 40,000 employees, representing 130 nationalities in more than 70 countries, the company helps its customers maximize value throughout the lifecycle of the reservoir – from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the asset. Visit the Company’s website at www.halliburton.com. Connect with Halliburton on Facebook, Twitter, LinkedIn, Instagram and YouTube.
Forward-looking Statements
The statements in this press release that are not historical statements, including statements regarding future financial performance, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: the impact of COVID-19 and any variants, the related economic repercussions and resulting negative impact on demand for oil and gas, operational challenges relating to COVID-19 and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees, remote work arrangements, performance of contracts and supply chain disruptions; the ability of the OPEC+ countries to agree on and comply with supply limitations; the continuation or suspension of our stock repurchase program, the amount, the timing, and the trading prices of Halliburton common stock, and the availability and alternative uses of cash; changes in the demand for or price of oil and/or natural gas; potential catastrophic events related to our operations, and related indemnification and insurance matters; protection of intellectual property rights and against cyber-attacks; compliance with environmental laws; changes in government regulations and regulatory requirements, particularly those related to oil and natural gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; compliance with laws related to income taxes and assumptions regarding the generation of future taxable income; risks of international operations, including risks relating to unsettled political conditions, war, the effects of terrorism, foreign exchange rates and controls, international trade and regulatory controls and sanctions, and doing business with national oil companies; weather-related issues, including the effects of hurricanes and tropical storms; changes in capital spending by customers, delays or failures by customers to make payments owed to us, and the resulting impact on our liquidity; execution of long-term, fixed-price contracts; structural changes and infrastructure issues in the oil and natural gas industry; maintaining a highly skilled workforce; availability and cost of raw materials; agreement with respect to and completion of potential dispositions, acquisitions and integration and success of acquired businesses and operations of joint ventures. Halliburton's Form 10-K for the year ended
Condensed Consolidated Statements of Operations (Millions of dollars and shares except per share data) (Unaudited) |
|||||||||||||
|
Three Months Ended |
||||||||||||
|
|
|
|
||||||||||
|
2021 |
|
2020 |
|
2021 |
||||||||
Revenue: |
|
|
|
|
|
||||||||
Completion and Production |
$ |
2,048 |
|
|
$ |
1,672 |
|
|
$ |
1,870 |
|
||
Drilling and Evaluation |
1,659 |
|
|
1,524 |
|
|
1,581 |
|
|||||
Total revenue |
$ |
3,707 |
|
|
$ |
3,196 |
|
|
$ |
3,451 |
|
||
Operating income (loss): |
|
|
|
|
|
||||||||
Completion and Production |
$ |
317 |
|
|
$ |
159 |
|
|
$ |
252 |
|
||
Drilling and Evaluation |
175 |
|
|
127 |
|
|
171 |
|
|||||
Corporate and other |
(58 |
) |
|
(50 |
) |
|
(53 |
) |
|||||
Impairments and other charges |
— |
|
|
(2,147 |
) |
|
— |
|
|||||
Total operating income (loss) |
434 |
|
|
(1,911 |
) |
|
370 |
|
|||||
Interest expense, net |
(120 |
) |
|
(124 |
) |
|
(125 |
) |
|||||
Other, net |
(19 |
) |
|
(48 |
) |
|
(22 |
) |
|||||
Income (loss) before income taxes |
295 |
|
|
(2,083 |
) |
|
223 |
|
|||||
Income tax benefit (provision) (a) |
(65 |
) |
|
402 |
|
|
(52 |
) |
|||||
Net Income (loss) |
$ |
230 |
|
|
$ |
(1,681 |
) |
|
$ |
171 |
|
||
Net (Income) loss attributable to noncontrolling interest |
(3 |
) |
|
5 |
|
|
(1 |
) |
|||||
Net Income (loss) attributable to company |
$ |
227 |
|
|
$ |
(1,676 |
) |
|
$ |
170 |
|
||
Basic and diluted net income (loss) per share |
$ |
0.26 |
|
|
$ |
(1.91 |
) |
|
$ |
0.19 |
|
||
Basic and diluted weighted average common shares outstanding |
890 |
|
|
877 |
|
|
889 |
|
(a) |
During the three months ended |
Condensed Consolidated Statements of Operations (Millions of dollars and shares except per share data) (Unaudited) |
||||||||
|
Six Months Ended |
|||||||
|
|
|||||||
|
2021 |
|
2020 |
|||||
Revenue: |
|
|
|
|||||
Completion and Production |
$ |
3,918 |
|
|
$ |
4,634 |
|
|
Drilling and Evaluation |
3,240 |
|
|
3,599 |
|
|||
Total revenue |
$ |
7,158 |
|
|
$ |
8,233 |
|
|
Operating income (loss): |
|
|
|
|||||
Completion and Production |
$ |
569 |
|
|
$ |
504 |
|
|
Drilling and Evaluation |
346 |
|
|
344 |
|
|||
Corporate and other |
(111 |
) |
|
(110 |
) |
|||
Impairments and other charges |
— |
|
|
(3,220 |
) |
|||
Total operating income (loss) |
804 |
|
|
(2,482 |
) |
|||
Interest expense, net |
(245 |
) |
|
(258 |
) |
|||
Loss on early extinguishment of debt (a) |
— |
|
|
(168 |
) |
|||
Other, net |
(41 |
) |
|
(71 |
) |
|||
Income (loss) before income taxes |
518 |
|
|
(2,979 |
) |
|||
Income tax benefit (provision) (b) |
(117 |
) |
|
283 |
|
|||
Net Income (loss) |
$ |
401 |
|
|
$ |
(2,696 |
) |
|
Net (Income) loss attributable to noncontrolling interest |
(4 |
) |
|
3 |
|
|||
Net Income (loss) attributable to company |
$ |
397 |
|
|
$ |
(2,693 |
) |
|
Basic and diluted net income (loss) per share |
$ |
0.45 |
|
|
$ |
(3.07 |
) |
|
Basic and diluted weighted average common shares outstanding |
889 |
|
|
877 |
|
(a) |
During the six months ended |
(b) |
The tax benefit during the six months ended |
Condensed Consolidated Balance Sheets (Millions of dollars) (Unaudited) |
|||||||
|
|
|
|
||||
|
2021 |
|
2020 |
||||
Assets |
|||||||
Current assets: |
|
|
|
||||
Cash and equivalents |
$ |
2,658 |
|
|
$ |
2,563 |
|
Receivables, net |
3,459 |
|
|
3,071 |
|
||
Inventories |
2,355 |
|
|
2,349 |
|
||
Other current assets |
1,455 |
|
|
1,492 |
|
||
Total current assets |
9,927 |
|
|
9,475 |
|
||
Property, plant, and equipment, net |
4,214 |
|
|
4,325 |
|
||
|
2,804 |
|
|
2,804 |
|
||
Deferred income taxes |
2,174 |
|
|
2,166 |
|
||
Operating lease right-of-use assets |
735 |
|
|
786 |
|
||
Other assets |
1,063 |
|
|
1,124 |
|
||
Total assets |
$ |
20,917 |
|
|
$ |
20,680 |
|
|
|
|
|
||||
Liabilities and Shareholders’ Equity |
|||||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
1,891 |
|
|
$ |
1,573 |
|
Accrued employee compensation and benefits |
528 |
|
|
517 |
|
||
Current maturities of long-term debt |
515 |
|
|
695 |
|
||
Current portion of operating lease liabilities |
247 |
|
|
251 |
|
||
Other current liabilities |
1,153 |
|
|
1,385 |
|
||
Total current liabilities |
4,334 |
|
|
4,421 |
|
||
Long-term debt |
9,124 |
|
|
9,132 |
|
||
Operating lease liabilities |
688 |
|
|
758 |
|
||
Employee compensation and benefits |
536 |
|
|
562 |
|
||
Other liabilities |
806 |
|
|
824 |
|
||
Total liabilities |
15,488 |
|
|
15,697 |
|
||
Company shareholders’ equity |
5,420 |
|
|
4,974 |
|
||
Noncontrolling interest in consolidated subsidiaries |
9 |
|
|
9 |
|
||
Total shareholders’ equity |
5,429 |
|
|
4,983 |
|
||
Total liabilities and shareholders’ equity |
$ |
20,917 |
|
|
$ |
20,680 |
|
Condensed Consolidated Statements of Cash Flows (Millions of dollars) (Unaudited) |
||||||||||||||
|
Six Months Ended |
|
Three Months Ended |
|||||||||||
|
|
|
|
|||||||||||
|
2021 |
|
2020 |
|
2021 |
|||||||||
Cash flows from operating activities: |
|
|
|
|
|
|||||||||
Net Income (loss) |
$ |
401 |
|
|
|
$ |
(2,696 |
) |
|
|
$ |
230 |
|
|
Adjustments to reconcile net income (loss) to cash flows from operating activities: |
|
|
|
|
|
|||||||||
Impairments and other charges |
— |
|
|
|
3,220 |
|
|
|
— |
|
|
|||
Depreciation, depletion, and amortization |
449 |
|
|
|
599 |
|
|
|
223 |
|
|
|||
Working capital (a) |
11 |
|
|
|
296 |
|
|
|
(48 |
) |
|
|||
Deferred income tax benefit |
— |
|
|
|
(353 |
) |
|
|
13 |
|
|
|||
Other operating activities |
(249 |
) |
|
|
(243 |
) |
|
|
(9 |
) |
|
|||
Total cash flows provided by operating activities |
612 |
|
|
|
823 |
|
|
|
409 |
|
|
|||
Cash flows from investing activities: |
|
|
|
|
|
|||||||||
Capital expenditures |
(295 |
) |
|
|
(355 |
) |
|
|
(191 |
) |
|
|||
Proceeds from sales of property, plant, and equipment |
105 |
|
|
|
122 |
|
|
|
47 |
|
|
|||
Other investing activities |
(31 |
) |
|
|
(48 |
) |
|
|
(15 |
) |
|
|||
Total cash flows used in investing activities |
(221 |
) |
|
|
(281 |
) |
|
|
(159 |
) |
|
|||
Cash flows from financing activities: |
|
|
|
|
|
|||||||||
Payments on long-term borrowings |
(192 |
) |
|
|
(1,653 |
) |
|
|
(4 |
) |
|
|||
Proceeds from issuance of long-term debt, net |
— |
|
|
|
994 |
|
|
|
— |
|
|
|||
Dividends to shareholders |
(80 |
) |
|
|
(198 |
) |
|
|
(40 |
) |
|
|||
Stock repurchase program |
— |
|
|
|
(100 |
) |
|
|
— |
|
|
|||
Other financing activities |
4 |
|
|
|
20 |
|
|
|
(1 |
) |
|
|||
Total cash flows used in financing activities |
(268 |
) |
|
|
(937 |
) |
|
|
(45 |
) |
|
|||
Effect of exchange rate changes on cash |
(28 |
) |
|
|
(62 |
) |
|
|
7 |
|
|
|||
Increase (decrease) in cash and equivalents |
95 |
|
|
|
(457 |
) |
|
|
212 |
|
|
|||
Cash and equivalents at beginning of period |
2,563 |
|
|
|
2,268 |
|
|
|
2,446 |
|
|
|||
Cash and equivalents at end of period |
$ |
2,658 |
|
|
|
$ |
1,811 |
|
|
|
$ |
2,658 |
|
|
(a) |
Working capital includes receivables, inventories, and accounts payable. |
See Footnote Table 1 for Reconciliation of Cash Flows from Operating Activities to Free Cash Flow |
Revenue and Operating Income (Loss) Comparison By Operating Segment and (Millions of dollars) (Unaudited) |
|||||||||||
|
Three Months Ended |
||||||||||
|
|
|
|
||||||||
Revenue |
2021 |
|
2020 |
|
2021 |
||||||
By operating segment: |
|
|
|
|
|
||||||
Completion and Production |
$ |
2,048 |
|
|
$ |
1,672 |
|
|
$ |
1,870 |
|
Drilling and Evaluation |
1,659 |
|
|
1,524 |
|
|
1,581 |
|
|||
Total revenue |
$ |
3,707 |
|
|
$ |
3,196 |
|
|
$ |
3,451 |
|
|
|
|
|
|
|
||||||
By geographic region: |
|
|
|
|
|
||||||
|
$ |
1,569 |
|
|
$ |
1,049 |
|
|
$ |
1,404 |
|
|
534 |
|
|
346 |
|
|
535 |
|
|||
|
679 |
|
|
691 |
|
|
634 |
|
|||
|
925 |
|
|
1,110 |
|
|
878 |
|
|||
Total revenue |
$ |
3,707 |
|
|
$ |
3,196 |
|
|
$ |
3,451 |
|
|
|
|
|
|
|
||||||
Operating Income (Loss) |
|
|
|
|
|
||||||
By operating segment: |
|
|
|
|
|
||||||
Completion and Production |
$ |
317 |
|
|
$ |
159 |
|
|
$ |
252 |
|
Drilling and Evaluation |
175 |
|
|
127 |
|
|
171 |
|
|||
Total |
492 |
|
|
286 |
|
|
423 |
|
|||
Corporate and other |
(58 |
) |
|
(50 |
) |
|
(53 |
) |
|||
Impairments and other charges |
— |
|
|
(2,147 |
) |
|
— |
|
|||
Total operating income (loss) |
$ |
434 |
|
|
$ |
(1,911 |
) |
|
$ |
370 |
|
Revenue and Operating Income (Loss) Comparison By Operating Segment and (Millions of dollars) (Unaudited) |
|||||||
|
Six Months Ended |
||||||
|
|
||||||
Revenue |
2021 |
|
2020 |
||||
By operating segment: |
|
|
|
||||
Completion and Production |
$ |
3,918 |
|
|
$ |
4,634 |
|
Drilling and Evaluation |
3,240 |
|
|
3,599 |
|
||
Total revenue |
$ |
7,158 |
|
|
$ |
8,233 |
|
|
|
|
|
||||
By geographic region: |
|
|
|
||||
|
$ |
2,973 |
|
|
$ |
3,509 |
|
|
1,069 |
|
|
862 |
|
||
|
1,313 |
|
|
1,522 |
|
||
|
1,803 |
|
|
2,340 |
|
||
Total revenue |
$ |
7,158 |
|
|
$ |
8,233 |
|
|
|
|
|
||||
Operating Income (Loss) |
|
|
|
||||
By operating segment: |
|
|
|
||||
Completion and Production |
$ |
569 |
|
|
$ |
504 |
|
Drilling and Evaluation |
346 |
|
|
344 |
|
||
Total |
915 |
|
|
848 |
|
||
Corporate and other |
(111 |
) |
|
(110 |
) |
||
Impairments and other charges |
— |
|
|
(3,220 |
) |
||
Total operating income (loss) |
$ |
804 |
|
|
$ |
(2,482 |
) |
FOOTNOTE TABLE 1 Reconciliation of Cash Flows from Operating Activities to Free Cash Flow (Millions of dollars) (Unaudited) |
|||||||||||
|
Six Months Ended |
|
Three Months Ended |
||||||||
|
|
|
|
||||||||
|
2021 |
|
2020 |
|
2021 |
||||||
Total cash flows provided by operating activities |
$ |
612 |
|
|
$ |
823 |
|
|
$ |
409 |
|
Capital expenditures |
(295 |
) |
|
(355 |
) |
|
(191 |
) |
|||
Proceeds from sales of property, plant, and equipment |
105 |
|
|
122 |
|
|
47 |
|
|||
Free cash flow (a) |
$ |
422 |
|
|
$ |
590 |
|
|
$ |
265 |
|
(a) |
The Free Cash Flow metric is a non-GAAP financial measure, which is calculated as “Total cash flows provided by operating activities” less “Capital expenditures” plus “Proceeds from sales of property, plant, and equipment.” Management believes that Free Cash Flow is a key measure to assess liquidity of the business and is consistent with the disclosures of our direct, large-cap competitors. Prior periods presented are consistent with this metric. |
Conference Call Details
Please visit the website to listen to the call via live webcast. You may also participate in the call by dialing (844) 358-9181 within
A replay of the conference call will be available on Halliburton’s website until
View source version on businesswire.com: https://www.businesswire.com/news/home/20210720005193/en/
For Investors:
Halliburton, Investor Relations
Investors@Halliburton.com
281-871-2688
For News Media:
Halliburton, External Affairs
PR@Halliburton.com
281-871-2601
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