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 30, 2001
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 30, 2001 registrant issued a press release entitled
"Halliburton Releases Fourth Quarter Results, Energy Services Group Income More
Than Doubles Over Prior Year" pertaining, among other things, to an announcement
that registrant's fourth quarter net income was $123 million ($0.28 per diluted
share). The $123 million is an increase of 62 percent compared to the 1999
fourth quarter net income and a 19 percent increase compared to 2000 third
quarter net income.
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 30, 2001.
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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 31, 2001 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 13
January 30, 2001
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Guy T. Marcus
January 30, 2001 Vice President-Investor Relations
214/978-2691
HALLIBURTON RELEASES FOURTH QUARTER RESULTS, ENERGY SERVICES
GROUP INCOME MORE THAN DOUBLES OVER PRIOR YEAR
DALLAS, Texas -- Halliburton Company (NYSE:HAL) reported today that
2000 fourth quarter net income was $123 million ($0.28 per diluted share) before
charges related to its engineering and construction businesses of $118 million,
net of taxes ($0.27 per diluted share). The $123 million is an increase of 62
percent compared to 1999 fourth quarter net income before gain on sale of
discontinued operations of $76 million ($0.17 per diluted share) and an increase
of 19 percent compared to 2000 third quarter net income before gain on sale of
vessels of $103 million ($0.23 per diluted share). Including the engineering and
construction charges, 2000 fourth quarter net income was $5 million ($0.01 per
diluted share).
Revenues from continuing operations were $3.2 billion representing an
improvement of 6 percent versus both the 2000 third quarter and the fourth
quarter of 1999. Operating income for the 2000 fourth quarter was $200 million
before the charges related to the engineering and construction business. This
compares to 1999 fourth quarter operating income of $79 million and 2000 third
quarter operating income of $159 million before the $88 million gain on sale of
vessels. Increased operating income is mostly due to improved results at
Halliburton Energy Services.
Dave Lesar, Halliburton's chairman of the board, president and chief
executive officer, said, " Halliburton Energy Services and Landmark Graphics,
which operate under the Energy Services Group, continue to perform exceptionally
well. The outlook for additional increases in earnings for Halliburton Energy
Services and Landmark remain very positive as North American activity is
expected to remain strong and while international activity should accelerate. As
previously announced, we have begun taking action to realign our engineering and
construction businesses under a single management team. This new team is
committed to building a profitable engineering and construction business that
can operate in today's global environment."
2000 Fourth Quarter Segment Results
The Energy Services Group segment posted 2000 fourth quarter revenues
of $2.3 billion representing an increase of 22 percent compared to the 1999
fourth quarter and an
-more-
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Halliburton Company page 2
increase of 13 percent sequentially. Operating income for the Energy Services
Group segment was $183 million before $59 million of charges related to Brown
and Root Energy Services. Energy Services Group revenues in the United States
increased by 37 percent from the year earlier quarter, while international
revenues increased by 15 percent.
Operating income improvements for the Energy Services Group segment
were mostly attributable to Halliburton Energy Services where income increased
approximately 260 percent compared to the fourth quarter of 1999, and increased
30 percent sequentially. This resulted in Halliburton Energy Services
incremental margins of 31 percent year-over-year and 24 percent sequentially.
The operating income improvement at Halliburton Energy Services was realized in
all geographic regions, especially in North America, due to higher activity
levels and improved pricing for products and services. In addition, operating
income at Landmark Graphics more than doubled compared to 2000 third quarter
reflecting higher software sales.
The Engineering and Construction Group segment's fourth quarter 2000
revenues were $918 million, just short of the $1.0 billion achieved in the third
quarter of this year and the $1.2 billion from the prior year quarter reflecting
the continuing difficult operating environment in the downstream petroleum
industry business. The segment posted an operating profit of $35 million for
2000 fourth quarter before the $134 million charge mentioned below. This
compares to the third quarter profits of $41 million.
The 2000 fourth quarter pre-tax charge related to the engineering and
construction businesses was $193 million, with $36 million related to severance
and restructuring and $157 million for project losses. The charge affected both
Brown & Root Energy Services in the Energy Services Group segment and the
Engineering and Construction Group segment by $59 million and $134 million,
respectively. As a result of these charges, continuing operations posted a net
loss of $21 million ($0.05 per diluted share).
Discontinued Operations
Efforts on selling the Dresser Equipment Group are proceeding well.
Negotiations are in process with a purchaser. Sale of this group is expected to
be announced in the near future.
Income from discontinued operations in the fourth quarter of 2000 was
$26 million ($0.06 cents per diluted share) compared to $27 million ($0.06 per
diluted share) in the third quarter.
Share Repurchase Program
The company believed that the current stock price did not reflect the
long-term potential of the company and aggressively purchased common stock under
the previously announced stock repurchase program during the quarter. From
September through the end of the year, over 20.4 million shares had been
purchased at a cost of almost $760 million, which were paid for through
short-term borrowings.
-more-
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Halliburton Company page 3
Technology and Business Successes
During the fourth quarter, Halliburton recognized several successes -
in technology, business and safety.
o Landmark Graphics Corporation announced a definitive agreement to
acquire PGS Data Management (PGSDM), a division of Petroleum
Geo-Services ASA. The agreement has been approved by the Halliburton
board of directors and is subject to various regulatory and other
approvals, as well as the finalization of certain ancillary agreements.
The acquisition will expand the Landmark Graphics' portfolio of
market-leading technology management solutions and services by adding
PGSDM's PetroBank solutions. PetroBank solutions are the industry
leader for cost effective internet enabled storage, browsing and
retrieval of large volumes of quality controlled exploration and
production (E&P) data and information.
o Enventure Global Technology a joint venture between Halliburton Energy
Services and Shell Exploration & Production Company installed a second
solid expandable tubular (SET) system in Shell's ultra-deepwater well
in Alaminos Canyon 557, making it the world's first well to have
multiple openhole SET installations, thus enabling Shell to explore the
deeper objectives of this ultra-deepwater well.
o Landmark Graphics Corporation has developed a new Web-enabled,
risk-based decision support solution. DecisionSpaceTM represents a new
paradigm for the industry by integrating technical and business tools
in a virtual desktop. DecisionSpaceTM is browser-based,
ASP-(application service provider) ready and designed to fully support
and enable the industry's rapid utilization of the emerging e-business
environment.
o Landmark Graphics Corporation's industry-leading Web-based service,
MyLandmarkTM , is now available exclusively to Landmark customers. My
Landmark, which was developed with customer input, dramatically
enhances the way customers interact with the company by delivering
real-time information and knowledge resources to the end user based on
the individual's perspective, needs and self-generated user profile.
This new Web-based service allows Landmark's customers to access a
patent-pending set of decision tools and process guides that assist
customers in making more effective and rapid decisions in the
exploration and development of oil and gas assets.
o Halliburton Energy Services announced commercialization of MRIL(R)
PrimeTime TM as yet another example of Halliburton delivering on its
commitment to real time reservoir solutions and reservoir description
reports for its clients.
o Fasttrax, a consortium led by Brown & Root Services has been selected
by the United Kingdom Ministry of Defense as the preferred bidder for a
contract for the provision of Heavy Equipment Transportation Services
to the British Army.
-more-
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o M.W. Kellogg Ltd, Kellogg Brown & Root's affiliate company in London,
has been awarded a contract to provide front-end engineering design
services for Union Fenosa's proposed Egyptian liquefied natural gas
(LNG) project in the port of Damieta in northern Egypt. The project,
estimated at approximately $1 billion, calls for the development of a
single-train LNG complex with an estimated capacity of 3.5 to 4 million
tons per annum.
o Halliburton Company and Shaw Industries Ltd's joint venture entity,
Bredero-Shaw, will invest $30 million in an integrated pipecoating and
fabricating facility near Mobile, Alabama. The facility will serve the
offshore deepwater markets and is scheduled to open in early 2001.
o Halliburton Subsea has been awarded a services contract by BP and its
co-ventures for West of Shetland developments potentially valued at $24
million. The scope of the contract includes provision of subsea
tie-back construction services and inspection, repair and maintenance
services plus vessel provision as required for the period November 2000
to December 2001, with the possibility of additional work in 2002 and
2003.
o Halliburton Worldwide Limited Oman has worked more than 600,000 hours
without a lost time incident and reached the driving milestone of two
million safe miles. Both milestones were reached on October 1.
o Halliburton Energy Services was recently recognized for achieving 500
days without a lost-time accident on the Terra Nova project.
Halliburton Energy Services is a core member of the Terra Nova
Alliance, providing well construction project management and drilling
and completions services to deliver the six pre-production wells.
o The Occupational Safety & Health Administration (OSHA) has officially
recognized Halliburton Energy Services' Jet Research Center in
Alvarado, Texas, as a Star site under its Voluntary Protection
Program (VPP) for having an exemplary safety and health program. Jet
Research Center is the first explosives manufacturing site ever to
enter such a program or achieve this type of recognition from OSHA.
o M.W. Kellogg Ltd., Kellogg Brown & Root's affiliate company in London,
has completed the final handover of the Karsto Upgrading Project gas
processing plant, 60 kilometers north of Stavanger, in Rogaland,
Norway. The fast-track project was completed in less that 38 months
with an exemplary health, safety and environment (HSE) record.
o Halliburton Energy Services announced a capital program aimed at
solidifying our market leader position. The Reservoir Monitor Tool
Elite (RMT EliteTM), a slim-hole pulsed neutron logging system for use
in the location and management of hydrocarbon reserves production was
introduced. The new system provides operators with a timely answer for
-more-
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Halliburton Company page 5
remedial work-over decisions. This allows oil and gas operators the
opportunity to accurately evaluate the time-lapse performance of their
hydrocarbon producing reservoirs, without removing the tubing from
wells, consequently they are seeing tremendous benefits and cost
savings when using the system.
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 and Engineering and Construction Group business segments.
The company's World Wide Web site can be accessed at 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, 2000 for a more complete discussion of such risk
factors.
###
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HALLIBURTON COMPANY
Consolidated Statements of Income
(Unaudited)
Fourth Quarter Ended Twelve Months Ended
December 31 December 31
---------------------------- ---------------------------
2000 1999 2000 1999
------------ ------------ ------------ -----------
Millions of dollars except per share data
Revenues
Energy Services Group $ 2,275 $ 1,865 $ 7,916 $ 6,999
Engineering and Construction Group 918 1,161 4,028 5,314
------------ ------------ ------------ -----------
Total revenues $ 3,193 $ 3,026 $ 11,944 $12,313
============ ============ ============ ===========
Operating income
Energy Services Group $ 124 $ 60 $ 526 $ 222
Engineering and Construction Group (99) 40 14 203
General corporate (18) (21) (78) (71)
Special charges and credits - - - 47
------------ ------------ ------------ -----------
Total operating income 7 79 462 401
Interest expense (42) (35) (146) (141)
Interest income 9 6 25 74
Foreign currency gains (losses), net (2) (6) (5) (8)
Other nonoperating, net - 6 (1) (19)
------------ ------------ ------------ -----------
Income from continuing operations before
income taxes, minority interests, and change
in accounting method (28) 50 335 307
(Provision)/benefit for income taxes 11 (18) (129) (116)
Minority interest in net income of subsidiaries (4) (4) (18) (17)
------------ ------------ ------------ -----------
Income/(loss) from continuing operations
before change in accounting method (21) 28 188 174
Discontinued operations:
Income from discontinued operations 26 48 98 124
Gain on disposal of discontinued operations - 159 215 159
------------ ------------ ------------ -----------
Total discontinued operations 26 207 313 283
------------ ------------ ------------ -----------
Cumulative effect of change in accounting
method, net - - - (19)
------------ ------------ ------------ -----------
Net income $ 5 $ 235 $ 501 $ 438
============ ============ ============ ===========
Basic income/(loss) per share:
Continuing operations before
change in accounting method $ (0.05) $ 0.06 $ 0.42 $ 0.40
Income from discontinued operations 0.06 0.11 0.22 0.28
------------ ------------ ------------ -----------
0.01 0.17 0.64 0.68
Gain on disposal of discontinued operations - 0.36 0.49 0.36
Change in accounting method - - - (0.04)
------------ ------------ ------------ -----------
Net income $ 0.01 $ 0.53 $ 1.13 $ 1.00
============ ============ ============ ===========
Diluted income/(loss) per share:
Continuing operations before change in
accounting method $ (0.05) $ 0.06 $ 0.42 $ 0.39
Income from discontinued operations 0.06 0.11 0.22 0.28
------------ ------------ ------------ -----------
0.01 0.17 0.64 0.67
Gain on disposal of discontinued operations - 0.36 0.48 0.36
Change in accounting method - - - (0.04)
------------ ------------ ------------ -----------
Net income $ 0.01 $ 0.53 $ 1.12 $ 0.99
============ ============ ============ ===========
Basic average common shares outstanding 435 441 442 440
Diluted average common shares outstanding 435 443 446 443
Page 10 of 13 Pages
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HALLIBURTON COMPANY
Pro Forma Statements of Income
(Unaudited)
Fourth Quarter Ended Twelve Months Ended
December 31 December 31
---------------------------- ---------------------------
2000 1999 2000 1999
------------ ------------ ------------ -----------
Millions of dollars except per share data
Revenues
Energy Services Group $ 2,275 $ 1,865 $ 7,916 $ 6,999
Engineering and Construction Group 918 1,161 4,028 5,314
Dresser Equipment Group 363 745 1,400 2,585
------------ ------------ ------------ -----------
Total revenues $ 3,556 $ 3,771 $ 13,344 $14,898
============ ============ ============ ===========
Operating income
Energy Services Group $ 124 $ 60 $ 526 $ 222
Engineering and Construction Group (99) 40 14 203
Dresser Equipment Group 43 109 158 249
General corporate (18) (21) (78) (71)
Special charges and credits - - - 47
------------ ------------ ------------ -----------
Total operating income 50 188 620 650
Interest expense (42) (36) (149) (144)
Interest income 7 6 26 76
Foreign currency gains (losses), net (1) (7) (3) (8)
Other nonoperating, net - 6 (1) (19)
------------ ------------ ------------ -----------
Pro forma income before income taxes,
minority interests, and change in accounting
method 14 157 493 555
Provision for income taxes (5) (61) (189) (214)
Minority interest in net income of subsidiaries (4) (20) (18) (43)
------------ ------------ ------------ -----------
Pro forma income before change in
accounting method 5 76 286 298
Cumulative effect of change in accounting
method, net - - - (19)
------------ ------------ ------------ -----------
Pro forma net income $ 5 $ 76 $ 286 $ 279
============ ============ ============ ===========
Basic pro forma income per share:
Before change in accounting method $ 0.01 $ 0.17 $ 0.65 $ 0.68
Change in accounting method - - - (0.04)
------------ ------------ ------------ -----------
Pro forma net income $ 0.01 $ 0.17 $ 0.65 $ 0.64
============ ============ ============ ===========
Diluted pro forma income per share:
Before change in accounting method $ 0.01 $ 0.17 $ 0.64 $ 0.67
Change in accounting method - - - (0.04)
------------ ------------ ------------ -----------
Pro forma net income $ 0.01 $ 0.17 $ 0.64 $ 0.63
============ ============ ============ ===========
Basic average common shares outstanding 435 441 442 440
Diluted average common shares outstanding 435 443 446 443
Note: The above pro forma financial information is for comparative purposes and
presented on a basis other than generally accepted accounting principles. This
pro forma income statement excludes the gain on sale of IDP and Dresser-Rand
joint venture, and treats Dresser Equipment Group as continuing operations.
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HALLIBURTON COMPANY
Comparisons on Depreciation, Depletion & Amortization, Capex
And Research & Development
(Unaudited)
($ in millions)
4th Qtr 4th Qtr Incr/ 3rd Qtr Incr/
2000 1999 (Decr) 2000 (Decr)
--------- --------- --------- -------- ---------
Depreciation, Depletion & Amortization
Depreciation, Depletion, Amortization of Intangibles 101 100 1 100 1
Amortization of Goodwill 9 12 (3) 12 (3)
Energy Services Group Total 110 112 (2) 112 (2)
Depreciation, Depletion, Amortization of Intangibles 7 8 (1) 7 0
Amortization of Goodwill 2 2 0 2 0
Engineering & Construction Group Total 9 10 (1) 9 0
Depreciation, Depletion, Amortization of Intangibles 20 9 11 18 2
Amortization of Goodwill 0 0 0 0 0
Corporate Total 20 9 11 18 2
Total Depreciation, Depletion, Amortization of Intangibles 128 117 11 125 3
Total Amortization of Goodwill 11 14 (3) 14 (3)
--------- --------- --------- -------- ---------
Total Expense for Continuing Operations $ 139 $ 131 $ 8 $ 139 $ 0
Depreciation, Depletion, Amortization of Intangibles 9 17 (8) 9 0
Amortization of Goodwill 5 3 2 3 2
--------- --------- --------- -------- ---------
Dresser Equipment Group Total (Discontinued Ops) $ 14 $ 20 $ (6) $ 12 $ 2
--------- --------- --------- -------- ---------
Total Depreciation, Depletion, Amortization Expense $ 153 $ 151 $ 2 $ 151 $ 2
========= ========= ========= ======== =========
Capital Expenditures
Energy Services Group 165 106 59 163 2
Engineering & Construction Group 28 10 18 1 27
Corporate and Other 18 19 (1) 14 4
--------- --------- --------- -------- ---------
Total for Continuing Operations $ 211 $ 135 $ 76 $ 178 $ 33
Dresser Equipment Group (Discontinued Ops) 7 25 (18) 6 1
--------- --------- --------- -------- ---------
Total Capital Expenditures $ 218 $ 160 $ 58 $ 184 $ 34
========= ========= ========= ======== =========
Research and Development
Energy Services Group 60 54 6 60 0
Engineering & Construction Group 2 1 1 2 0
Dresser Equipment Group 6 10 (4) 6 0
--------- --------- --------- -------- ---------
Total Research and Development $ 68 $ 65 $ 3 $ 68 $ 0
========= ========= ========= ======== =========
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HALLIBURTON COMPANY
Analysis of Pro forma Earnings
(Unaudited)
Millions of dollars except per share data
4th Qtr 3rd Qtr. 4th Qtr.
2000 2000 1999
------------ ------------ ------------
Net Income as Reported $ 5 $ 157 $ 235
Gain on Sale of Vessels (54)
Gain on Sale of Discontinued Operations (159)
Engineering and Construction Charges 118
------------ ------------ ------------
Pro forma Net Income $ 123 $ 103 $ 76
============ ============ ============
Earnings per Share as Reported $ 0.01 $ 0.35 $ 0.53
Gain on Sale of Vessels (0.12)
Gain on Sale of Discontinued Operations (0.36)
Engineering and Construction Charges 0.27
------------ ------------ ------------
Pro forma Earnings per Share $ 0.28 $ 0.23 $ 0.17
============ ============ ============
Note: The above pro forma financial information is for comparative purposes and
presented on a basis other than generally accepted accounting principles.
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