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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (date of earliest event reported)
OCTOBER 29, 1998
Halliburton Company
(Exact name of registrant as specified in its charter)
State or other Commission IRS Employer
jurisdiction File Number Identification
of incorporation Number
Delaware 1-3492 No. 75-2677995
3600 Lincoln Plaza
500 North Akard Street
Dallas, Texas 75201-3391
(Address of principal executive offices)
Registrant's telephone number,
including area code - 214/978-2600
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INFORMATION TO BE INCLUDED IN REPORT
Item 5. Other Events
The registrant may, at its option, report under this item any events,
with respect to which information is not otherwise called for by this form, that
the registrant deems of importance to security holders.
On October 29, 1998 registrant issued a press release entitled
Halliburton 1998 Third Quarter Earnings pertaining, among other things, to an
announcement that registrant earned $195 million ($.44 per diluted share) in the
1998 third quarter, compared to $218 million ($.50 per diluted share) in the
1997 third quarter, before recognition of special charges. Financial results of
both years have been restated to reflect completion of registrant's merger with
Dresser Industries, Inc. on September 29, 1998. The merger was accounted for as
a pooling of interests. Third quarter 1998 revenues were $4,224 million, up one
percent over the $4,177 million of revenues generated in the year earlier
period. The 1998 third quarter financial results include a pretax special charge
of $945 million ($722 million after tax or $1.64 per diluted share) to provide
for consolidation, restructuring and merger related expenses.
Item 7. Financial Statements and Exhibits
List below the financial statements, pro forma financial information
and exhibits, if any, filed as part of this report.
(c) Exhibits.
Exhibit 20 - Press release dated October 29, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HALLIBURTON COMPANY
Date: October 30, 1998 By: /s/ Lester L. Colemen
--------------------------------
Lester L. Coleman
Executive Vice President and
General Counsel
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EXHIBIT INDEX
Exhibit Sequentially
Number Description Numbered Page
20 Press Release of 5 of 8
October 29, 1998
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Guy T. Marcus
October 29, 1998 Vice President-Investor Relations
(214) 978-2691
HALLIBURTON 1998 THIRD QUARTER EARNINGS
DALLAS, Texas -- Halliburton Company (NYSE:HAL) announces that the
company earned $195 million ($ .44 per diluted share) in the 1998 third quarter,
compared to $218 million ($ .50 per diluted share) in the 1997 third quarter,
before recognition of special charges. Financial results of both years have been
restated to reflect completion of the company's merger with Dresser Industries,
Inc. on September 29, 1998. The merger was accounted for as a pooling of
interests. Third quarter 1998 revenues were $4,224 million, up one percent over
the $4,177 million of revenues generated in the year earlier period.
The 1998 third quarter financial results include a pretax special
charge of $945 million ($722 million after tax or $1.64 per diluted share) to
provide for consolidation, restructuring and merger related expenses. Components
of the pretax special charge include $509 million of asset related writeoffs,
writedowns and charges; $205 million related to personnel reduction costs; $121
million of facility consolidation charges; $64 million of merger transaction
costs; and $46 million of other merger related costs. Including the special
charge, Halliburton's net loss was $527 million ($1.20 per diluted share) in the
1998 third quarter.
The Energy Services Group business segment's 1998 third quarter
revenues were $2,163 million, a decline of three percent compared to the year
earlier quarter. Adjusting for the de-consolidation of the Bredero-Shaw joint
venture, revenues were flat. The worldwide rotary rig count declined by 21
percent in the 1998 third quarter,
-more-
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Halliburton Company page 2
compared to a year ago. Lower crude oil and natural gas prices during 1998 have
reduced customers' cash flows and influenced them to pull back on exploration,
development and production spending during the third quarter. International
revenues improved about five percent and represented 72 percent of the segment's
revenues during the 1998 third quarter, while U.S. revenues in the quarter
declined about 18 percent. U.S. activity was hampered by both weaker general
market conditions and tropical storms in the Gulf of Mexico. Despite weaker
market conditions, the Landmark Graphics Corporation data interpretation and
management business and the upstream engineering and construction activities of
Brown & Root Energy Services registered higher revenues for the quarter.
The Energy Services Group's 1998 third quarter operating income was
$263 million, off eight percent from the 1997 quarter. Operating margins were
12.1 percent in the 1998 third quarter, compared to 12.9 percent a year earlier.
The Engineering and Construction Group business segment's revenues
totaled $1,379 million in the 1998 third quarter, an increase of nine percent
compared to last year's quarter. Operating income was $54 million in the
quarter, up two percent from the 1997 third quarter. The increase of revenues
was due, in part, to procurement related activities which carried minimal profit
margins.
The Dresser Equipment Group business segment's revenues were $681
million in the 1998 third quarter, about the same as a year earlier. Operating
income increased by seven percent in the 1998 third quarter, compared to the
1997 quarter, while operating margins for the segment improved to 10.4 percent
compared to the 1997 quarter's 9.7 percent. The segment's operating income and
margin improvements were largely driven by stronger performance by the
compression business, due primarily to cost reduction initiatives implemented in
late 1997.
-more-
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Bill Bradford, chairman of the board of Halliburton, commented,
"Completion of the merger with Dresser positions Halliburton as the premier
company providing both oilfield and engineering and construction services to the
upstream and downstream petroleum industry. The company is now uniquely
positioned in the energy industry in providing customers the broadest suite of
products, services and technologies."
Dick Cheney, Halliburton Company's chief executive officer, said,
"While market conditions now challenge all petroleum industry participants, I am
very optimistic about the outlook for Halliburton in the year ahead and the
longer term. The completion of the merger with Dresser is most timely. The
merger with Dresser is expected to be accretive to Halliburton's earnings per
share. Action plans now being implemented should enable the company to achieve
annualized pretax benefits of $250 million by the end of the first year of
combined operations. Also, the merger and restructuring will generate additional
advantages by strengthening and improving Halliburton's balance sheet,
technological base, product/service line offerings and integrated solutions
capabilities which will mutually benefit both Halliburton and its customers. Our
goal is to continue to build upon these strengths as we go forward."
Halliburton Company, founded in 1919, is the world's largest provider
of products and services to the petroleum and energy industries. The company
serves its customers with a broad range of products and services through its
Energy Services Group, Engineering and Construction Group, and Dresser Equipment
Group business segments. In 1997 Halliburton's consolidated revenues were $16.3
billion and it conducted business with a workforce of approximately 100,000 in
over 120 countries. The company's World Wide Web site can be accessed at
http://www.halliburton.com.
###
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HALLIBURTON COMPANY
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Quarter Ended Nine Months Ended
September 30 September 30
---------------------- ----------------------
1998 1997 1998 1997
---------- ---------- ---------- ----------
Millions of dollars except per share data
Revenues
Energy Services Group $ 2,163.4 $ 2,220.8 $ 6,828.9 $ 6,080.7
Engineering and
Construction Group 1,379.4 1,268.6 4,164.5 3,722.2
Dresser Equipment
Group 681.2 687.6 2,070.6 1,978.5
---------- ---------- ---------- ----------
Total revenues $ 4,224.0 $ 4,177.0 $ 13,064.0 $ 11,781.4
========== ========== ========== ==========
Operating income
Energy Services Group $ 262.7 $ 287.0 $ 850.1 $ 705.4
Engineering and
Construction Group 54.0 53.2 187.3 152.6
Dresser Equipment
Group 71.0 66.6 187.1 148.0
Special charges (945.1) (18.3) (945.1) (18.3)
General corporate (20.1) (16.3) (59.7) (51.4)
---------- ---------- ---------- ----------
Total operating income (loss) (577.5) 372.2 219.7 936.3
Interest expense (34.6) (30.1) (95.9) (80.2)
Interest income 7.2 5.0 21.4 15.8
Foreign currency
losses (7.9) (1.5) (9.7) (3.7)
Other nonoperating, net 3.3 (0.2) 2.7 0.4
---------- ---------- ---------- ----------
Income (loss) before income taxes
and minority interests (609.5) 345.4 138.2 868.6
Benefit (provision) for
income taxes 96.6 (130.0) (184.1) (325.0)
Minority interest in net
income of subsidiaries (14.1) (12.8) (34.5) (29.2)
---------- ---------- ---------- ----------
Net income (loss) $ (527.0) $ 202.6 $ (80.4) $ 514.4
========== ========== ========== ==========
Basic income (loss)
per share $ (1.20) $ 0.47 $ (0.18) $ 1.20
Diluted income (loss)
per share $ (1.20) $ 0.47 $ (0.18) $ 1.19
Basic average
common shares
outstanding 439.1 428.9 438.6 429.0
Diluted average
common shares
outstanding 439.1 433.5 438.6 432.9
Prior periods restated for the acquisition of Dresser Industries, Inc., which
has been accounted for as a pooling of interests.
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