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)
JULY 26, 2000
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 July 26, 2000 registrant issued a press release entitled
"Halliburton Announces Second Quarter Earnings of 17 Cents Per Share,"
pertaining to, among other things, an announcement that registrant's 2000
second quarter net income was $75 million ($0.17 per share diluted) compared to
$83 million ($0.19 per share diluted) in the second quarter of 1999. Revenues
from continuing operations were $2.9 billion in the 2000 second quarter, about
the same as the 2000 first quarter.
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 July 26, 2000.
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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: July 26, 2000 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 11
July 26, 2000
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Guy T. Marcus
July 26, 2000 Vice President-Investor Relations
214/978-2691
HALLIBURTON ANNOUNCES SECOND QUARTER EARNINGS OF
17 CENTS PER SHARE
Dallas, Texas - Halliburton Company (NYSE:HAL) reported today that the
company's 2000 second quarter net income was $75 million ($0.17 per share
diluted) compared to $83 million ($0.19 per share diluted) in the 1999 second
quarter.
Revenues from continuing operations were $2.9 billion in the 2000
second quarter, about the same as the 2000 first quarter. Compared to the
year-ago quarter, a 13 percent increase in the Energy Services Group's revenues
substantially offset a 29 percent decrease in the Engineering and Construction
Group's revenues.
2000 Second Quarter Segment Results
The Energy Services Group business segment's 2000 second quarter
revenues were $1.9 billion, a 13 percent increase over the year-ago quarter and
a 10 percent increase sequentially. The Halliburton Energy Services business
unit led the business segment with a 24 percent year-over-year quarterly revenue
increase and a sequential quarterly improvement of 12 percent. The
year-over-year quarterly revenue improvement for the business segment was
primarily driven by a 36 percent increase in the U.S. which was complemented by
a four percent increase internationally. On a sequential basis, U. S. revenues
increased 13 percent, while international revenues were up nine percent.
International revenues represented approximately two-thirds of the Energy
Service Group's total revenues during the quarter.
-more-
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Halliburton Company page 2
The Energy Services Group's operating income of $107 million in the
2000 second quarter increased 118 percent over the 1999 second quarter and 73
percent sequentially. The improvements are primarily due to higher capacity
utilization and price improvements in Halliburton Energy Services' North
American operations where incremental margins were 34 percent compared to the
1999 second quarter and 40 percent sequentially. Increased sales and
profitability on software at Landmark Graphics also contributed to the segment's
improved operating income. Brown & Root Energy Services' operating income
remained slightly above breakeven sequentially due to continued low utilization
of manufacturing and fabrication capacities as well as delayed customer
projects.
The Engineering and Construction Group business segment's revenues were
$971 million in the 2000 second quarter, a 29 percent decline from the 1999
quarter and a 14 percent decline sequentially. Most of the decline was
attributable to reduced customer spending levels associated with Kellogg Brown &
Root's downstream petroleum industry business. Operating income from the
Engineering and Construction Group in the 2000 second quarter was $36 million,
flat sequentially and down from $64 million in the 1999 second quarter primarily
due to the decline in revenues.
Discontinued Operations
Earlier this year Halliburton announced plans to sell the company's
Dresser Equipment Group's business units to sharpen focus on the company's core
business activities. Therefore, such businesses are now accounted for as
discontinued operations.
Net income from discontinued operations in the 2000 second quarter was
$23 million ($0.05 per share diluted) compared to $28 million ($0.06 per share
diluted) in the 1999 second quarter. The decrease is due to the sale of
Ingersoll-Dresser Pump and Dresser-Rand in late 1999 and early 2000.
-more-
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Halliburton Company page 3
The sales of the remaining Dresser Equipment Group business units are
expected during the fourth quarter of 2000 and the first quarter of 2001.
Technology and Business Successes
During the last three months, Halliburton achieved a number of
technology and business successes, including:
o Halliburton and Petrobras signed contracts totaling more than $2.5
billion for the development of both the Barracuda and Caratinga
deepwater oil fields in Brazil. Work totaling $1.7 billion will
be performed by Halliburton's Brown & Root Energy Services and
Halliburton Energy Services business units, and the balance will be
performed by Petrobras under a subcontract.
o Halliburton Energy Services announced that the initial trials of
its revolutionary new technology, the Anaconda Advanced Well
Construction System, have been successfully completed.
Halliburton, along with Statoil of Norway, developed the first
phase of this unique technology to economically enhance drainage
and recovery of reserves in Statoil's mature North Sea fields.
o Brown & Root Energy Services completed the installation of the
91,000 ton Malampaya concrete gravity sub-structure offshore
Palawan Island in the Philippines. The installation was achieved
three months ahead of schedule and marks the first such
installation in the South China Sea.
o Halliburton Energy Services entered into a strategic partnership
with GeoMechanics International, Inc. (GMI), bringing together
Halliburton's global leadership in logging-while-drilling and
directional drilling services and GMI's leadership in providing
wellbore stability software and consulting services to the worldwide
energy industry.
-more-
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Halliburton Company page 4
o Halliburton Energy Services launched "Stim Star II" - its latest
dynamically-positioned stimulation vessel for the deepwater Gulf
of Mexico.
o Brown & Root Services has been awarded a logistical support
contract by the U.S. Department of the Navy which is similar to
the company's contract with the U.S. Army. The contract provides
for personnel, equipment, materials, labor, and travel for
immediate response to emergencies caused by natural disasters,
military conflict, and/or support of humanitarian assistance.
Dick Cheney Comments
Dick Cheney, Halliburton's chairman of the board and chief executive
officer, said, "I am pleased with the strong financial performance of our oil
field services related businesses in the 2000 second quarter, particularly their
performance in North America. With continued high demand for natural gas and
relatively high depletion rates constraining production, we expect future
business opportunities to increase. International business is just beginning to
recover as the world crude oil supply/demand balance has tightened
significantly. Our customers now indicate upward revisions to their exploration,
development and production spending budgets to capitalize on the improved oil
and gas outlook. Downstream petroleum industry spending, that significantly
impacts Halliburton's engineering and construction business, will lag
improvements in the upstream marketplace and will likely begin expansion in
2001."
Cheney continued, "As you know, I have announced that I will be
resigning from Halliburton effective August 16 to be George W. Bush's vice
presidential running mate. I am proud to have had the opportunity to serve
Halliburton's shareholders over the past five years, and I have every confidence
that Dave Lesar, my successor, will provide excellent future leadership of the
company."
Halliburton Company, founded in 1919, is the world's largest provider
of products and services to the petroleum and energy industries. The company
-more-
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Halliburton Company page 5
serves its customers with a broad range of products and services through its
Energy Services Group and Engineering and Construction 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 March 31, 2000 for a more complete discussion of such risk
factors.
###
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HALLIBURTON COMPANY
Consolidated Statements of Income
(Unaudited)
Quarter Ended Six Months Ended
June 30 June 30
------------------------ -------------------------
2000 1999 2000 1999
--------- --------- --------- ---------
Millions of dollars except per share data
Revenues
Energy Services Group $ 1,897 $ 1,681 $ 3,620 $ 3,434
Engineering and Construction Group 971 1,372 2,107 2,880
--------- --------- --------- ---------
Total revenues $ 2,868 $ 3,053 $ 5,727 $ 6,314
========= ========= ========= =========
Operating income
Energy Services Group $ 107 $ 49 $ 169 $ 106
Engineering and Construction Group 36 64 72 122
General corporate (17) (17) (34) (34)
Special charges and credits - 47 - 47
--------- --------- --------- ---------
Total operating income 126 143 207 241
Interest expense (33) (33) (66) (68)
Interest income 3 6 10 37
Foreign currency losses, net (3) 3 (7) 2
Other nonoperating, net - (26) - (24)
--------- --------- --------- ---------
Income from continuing operations
before income taxes, minority interests,
and change in accounting method 93 93 144 188
Provision for income taxes (36) (33) (56) (71)
Minority interest in net income of subsidiaries (5) (5) (9) (9)
--------- --------- --------- ---------
Income from continuing operations before
change in accounting method 52 55 79 108
Discontinued operations:
Income from discontinued operations 23 28 45 56
Gain on disposal of discontinued operations - - 215 -
--------- --------- --------- ---------
Total discontinued operations 23 28 260 56
--------- --------- --------- ---------
Cumulative effect of change in
accounting method, net - - - (19)
--------- --------- --------- ---------
Net income $ 75 $ 83 $ 339 $ 145
========= ========= ========= =========
Basic income per share:
Continuing operations before
change in accounting method $ 0.12 $ 0.13 $ 0.18 $ 0.25
Income from discontinued operations 0.05 0.06 0.10 0.12
--------- --------- --------- ---------
0.17 0.19 0.28 0.37
Gain on disposal of discontinued operations - - 0.49 -
Change in accounting method - - - (0.04)
--------- --------- --------- ---------
Net income $ 0.17 $ 0.19 $ 0.77 $ 0.33
========= ========= ========= =========
Diluted income per share:
Continuing operations before
change in accounting method $ 0.12 $ 0.13 $ 0.18 $ 0.25
Income from discontinued operations 0.05 0.06 0.10 0.12
--------- --------- --------- ---------
0.17 0.19 0.28 0.37
Gain on disposal of discontinued operations - - 0.48 -
Change in accounting method - - - (0.04)
--------- --------- --------- ---------
Net income $ 0.17 $ 0.19 $ 0.76 $ 0.33
========= ========= ========= =========
Basic average common shares outstanding 444 440 443 440
Diluted average common shares outstanding 449 444 447 443
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HALLIBURTON COMPANY
Pro Forma Statements of Income
(Unaudited)
Quarter Ended Six Months Ended
June 30 June 30
------------------------ -------------------------
2000 1999 2000 1999
--------- --------- --------- ---------
Millions of dollars except per share data
Revenues
Energy Services Group $ 1,897 $ 1,681 $ 3,620 $ 3,434
Engineering and Construction Group 971 1,372 2,107 2,880
Dresser Equipment Group 354 617 691 1,280
--------- --------- --------- ---------
Total revenues $ 3,222 $ 3,670 $ 6,418 $ 7,594
========= ========= ========== =========
Operating income
Energy Services Group $ 107 $ 49 $ 169 $ 106
Engineering and Construction Group 36 64 72 122
Dresser Equipment Group 37 53 73 107
General corporate (17) (17) (34) (34)
Special charges and credits - 47 - 47
--------- --------- --------- ---------
Total operating income 163 196 280 348
Interest expense (34) (34) (68) (70)
Interest income 4 6 12 38
Foreign currency gains, net (2) 4 (6) 3
Other nonoperating, net - (26) - (24)
--------- --------- --------- ---------
Pro forma income before income taxes,
minority interests, and change
in accounting method 131 146 218 295
Provision for income taxes (51) (53) (85) (113)
Minority interest in net income
of subsidiaries (5) (10) (9) (18)
--------- --------- --------- ---------
Pro forma income before
change in accounting method 75 83 124 164
Cumulative effect of change in
accounting method, net - - - (19)
--------- --------- --------- ---------
Pro forma net income $ 75 $ 83 $ 124 $ 145
========= ========= ========= =========
Basic pro forma income per share:
Before change in accounting method $ 0.17 $ 0.19 $ 0.28 $ 0.37
Change in accounting method - - - (0.04)
--------- --------- --------- ---------
Pro forma net income $ 0.17 $ 0.19 $ 0.28 $ 0.33
========= ========= ========= =========
Diluted pro forma income per share:
Before change in accounting method $ 0.17 $ 0.19 $ 0.28 $ 0.37
Change in accounting method - - - (0.04)
---------- --------- --------- ---------
Pro forma net income $ 0.17 $ 0.19 $ 0.28 $ 0.33
========== ========= ========= =========
Basic average common shares outstanding 444 440 443 440
Diluted average common shares outstanding 449 444 447 443
Note: The above pro forma financial information is for comparative purposes and is
presented on a basis other than generally accepted accounting principles. This pro
forma income statement excludes the gain on sale of the Dresser-Rand joint venture
and treats Dresser Equipment Group as continuing operations.
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