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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)
JANUARY 25, 1999
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 January 25, 1999 registrant issued a press release entitled
Halliburton Reports 1998 Fourth Quarter pertaining, among other things, to an
announcement that registrant earned $90 million ($.20 per diluted share) in the
1998 fourth quarter compared to $257 million ($.58 per diluted share) in the
1997 fourth quarter, before inclusion of special charges. Including the 1998
fourth quarter special charges of $24 million after-tax ($.05 per diluted share)
to accommodate additional planned personnel reductions and additional facility
consolidations, the 1998 fourth quarter's net income was $66 million ($.15 per
diluted share). Revenues for the 1998 quarter were $4.3 billion, a five percent
decline compared to the year earlier quarter. For the 1998 full year,
registrant's net income before special charges was $731 million ($1.67 per
diluted share), down seven percent from 1998 while revenues increased seven
percent to $17.4 billion. As a result of the merger of registrant and Dresser
Industries, Inc. and market driven employment reductions, total 1998 special
charges were $746 million after-tax ($1.70 per diluted share). Including such
special charges, registrant recorded a $15 million loss for the 1998 full year.
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 January 25, 1999.
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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: January 27, 1999 By: /s/ Susan S. Keith
--------------------------------
Susan S. Keith
Vice President and Secretary
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EXHIBIT INDEX
Exhibit Sequentially
Number Description Numbered Page
20 Press Release of 5 of 8
January 25, 1999
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Guy T. Marcus
January 25, 1999 Vice President-Investor Relations
(214) 978-2691
HALLIBURTON REPORTS 1998 FOURTH QUARTER
DALLAS, Texas -- Halliburton Company (NYSE:HAL) today announces that
the company earned $90 million ($ .20 per diluted share) in the 1998 fourth
quarter, compared to $257 million ($ .58 per diluted share) in the 1997 fourth
quarter, before inclusion of special charges. Including 1998 fourth quarter
special charges of $24 million after-tax ($ .05 per diluted share) to
accommodate additional planned personnel reductions of 2,750 and additional
facility consolidations, the 1998 fourth quarter's net income was $66 million ($
.15 per diluted share). Revenues for the 1998 quarter were $4.3 billion, a five
percent decline compared to the year earlier quarter. The reduction of revenues
and earnings was driven by the continued decline of crude oil prices which have
reduced customers' cash flows and capital spending programs.
For the 1998 full year, Halliburton's net income before special charges
was $731 million ($1.67 per diluted share), down seven percent from 1998, while
revenues increased seven percent to $17.4 billion. During 1998 Halliburton and
Dresser Industries completed a merger of the two companies. As a result of a
combination of the merger and market driven employment reductions, total 1998
special charges were $746 million after-tax ($1.70 per diluted share). Including
such special charges, Halliburton recorded a $15 million loss for the 1998 full
year.
The Energy Services Group business segment's 1998 fourth quarter
revenues were $2,181 million, a decline of 10 percent compared to the year
earlier revenues. The average worldwide rotary rig count declined 30 percent
during the time period.
-more-
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Halliburton Company page 2
Revenues generated in the U.S. fell 25 percent while international revenues were
four percent lower than the year earlier quarter. The 1998 fourth quarter
international business operations represented 76 percent of the segment's
revenues. Landmark Graphics Corporation and Brown & Root Energy Services, the
upstream engineering and construction business unit, experienced six percent and
two percent revenue growth, respectively, in the 1998 fourth quarter while the
Halliburton Energy Services business unit's revenues declined about 16 percent.
The Energy Services Group's operating income was $121 million in the
1998 fourth quarter, a decline of 62 percent from the year earlier quarter. The
segment's 1998 fourth quarter operating income includes $60 million of
previously announced pre-tax provisions for project losses by the Brown & Root
Energy Services business unit relating to project claims collections from
certain customers in the North Sea, North Africa and Latin America.
The Engineering and Construction Group business segment's revenues
increased by five percent to $1,330 million in the 1998 fourth quarter compared
to the 1997 quarter. About 65 percent of the segment's revenues were from
activities outside the U.S. Operating income was $50 million in the 1998 fourth
quarter, 25 percent less than a year earlier. This decrease is partly due to
project losses associated with the remaining highway and paving business which
the company is in the process of exiting.
Revenues for the Dresser Equipment Group business segment were $778
million in the 1998 fourth quarter, about three percent less than last year's
fourth quarter. Operating income was $61 million, down 39 percent compared to
the 1997 quarter due to $17 million in other non-recurring merger related costs
which were recorded during the quarter and the changing of the Dresser fiscal
year to a calendar year.
Dick Cheney, Halliburton Company's chief executive officer, said, "The
outlook has changed dramatically since we closed the merger with Dresser on
October 1, 1998. Then we expressed the goal of being able to achieve double
digit growth in earnings 1999 over 1998, before special charges. Given the state
of today's market, it's pretty clear that is not going to occur. Like many in
-more-
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Halliburton Company page 3
the industry, however, I remain optimistic about the long-term outlook for our
industry and for Halliburton in particular. As previously announced, we are
moving aggressively to right size our business for the market that is out there.
We will continue to implement the merger with Dresser which looks better
everyday as we deal with today's environment. It does provide us with
significant opportunities to cut costs, to improve our technology, to strengthen
our individual product service lines, and position ourselves for the upturn
which will occur eventually."
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. The company's World Wide Web site can be accessed at
http://www.halliburton.com.
NOTE: In accordance with the Safe Harbor provisions of the
Private Securities Litigation Reform Act of 1995, Halliburton Company cautions
that statements in this press release which are forward looking and which
provide other than historical information, involve risks and uncertainties that
may impact the company's actual results of operations. Please see Halliburton's
Form 10-Q for the quarter ended September 30, 1998 for a more complete
discussion of such risk factors.
###
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HALLIBURTON COMPANY
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Quarter Ended Twelve Months Ended
December 31 December 31
------------------------ --------------------------
1998 1997 1998 1997
------------ ----------- ------------ ------------
Millions of dollars except per share data
Revenues
Energy Services Group $ 2,180.6 $ 2,424.0 $ 9,009.5 $ 8,504.7
Engineering and
Construction Group 1,330.3 1,270.6 5,494.8 4,992.8
Dresser Equipment Group 778.2 800.5 2,848.8 2,779.0
------------ ------------ ------------- -------------
Total revenues $ 4,289.1 $ 4,495.1 $ 17,353.1 $ 16,276.5
============ ============ ============= =============
Operating income
Energy Services Group $ 120.9 $ 314.0 $ 971.0 $ 1,019.4
Engineering and
Construction Group 49.9 66.4 237.2 219.0
Dresser Equipment Group 60.7 100.3 247.8 248.3
Special charges (35.0) 2.1 (980.1) (16.2)
General corporate (19.7) (20.4) (79.4) (71.8)
------------ ------------ ------------- -------------
Total operating income 176.8 462.4 396.5 1,398.7
Interest expense (40.9) (31.1) (136.8) (111.3)
Interest income 6.4 6.1 27.8 21.9
Foreign currency gains (losses) (2.7) 3.0 (12.4) (0.7)
Other nonoperating, net 1.0 4.1 3.7 4.5
------------ ------------ ------------- -------------
Income before income
taxes and minority interests 140.6 444.5 278.8 1,313.1
Provision for income taxes (60.3) (166.4) (244.4) (491.4)
Minority interest in net income
of subsidiaries (14.6) (20.1) (49.1) (49.3)
------------ ------------ ------------- -------------
Net income (loss) $ 65.7 $ 258.0 $ (14.7) $ 772.4
============ ============ ============= =============
Basic income (loss) per share $ 0.15 $ 0.59 $ (0.03) $ 1.79
Diluted income (loss) per share $ 0.15 $ 0.58 $ (0.03) $ 1.77
Basic average common
shares outstanding 439.3 437.6 438.8 431.1
Diluted average common
shares outstanding 441.6 443.5 438.8 436.1
Prior periods restated for the acquisition of Dresser Industries, Inc., which
has been accounted for as a pooling of interests.
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