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 23, 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 October 23, 2001 registrant issued a press release entitled "Halliburton
Posts Record Profits" pertaining, among other things, to an announcement that
registrant reported 2001 third quarter net income of $179 million ($0.42 per
diluted share). Net income from continuing operations was $181 million ($0.42
per diluted share), an increase of 39 percent over the prior year quarter and
the highest earnings since registrant's merger with Dresser was completed in
1998. Revenues from continuing operations were $3.4 billion in the 2001 third
quarter, an increase of 12 percent compared to the year ago quarter. Operating
income of $342 million for the quarter represents an increase of 38 percent
compared to the 2000 third quarter operating income of $248 million. Excluding a
non-recurring gain in the 2000 third quarter, operating income more than
doubled. Compared to the 2001 second quarter, operating income increased $70
million on increased revenues of $52 million.
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 23, 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: October 24, 2001 By: /s/ Susan S. Keith
--------------------------------------
Susan S. Keith
Vice President and Secretary
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EXHIBIT INDEX
Exhibit Description
20 Press Release Dated October 23, 2001
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Cedric Burgher
10/23/01 Vice President-Investor Relations
713-676-4933
cedric.burgher@halliburton.com
Wendy Hall
Manager-Media Relations
713-676-5227
wendy.hall@halliburton.com
HALLIBURTON POSTS RECORD PROFITS
DALLAS, Texas -- Halliburton Company (NYSE: HAL) reported today 2001 third
quarter net income of $179 million ($0.42 per diluted share). Net income from
continuing operations was $181 million ($0.42 per diluted share), an increase of
39 percent over the prior year quarter and the highest earnings since the merger
with Dresser was completed in 1998.
Revenues from continuing operations were $3.4 billion in the 2001 third
quarter, an increase of 12 percent compared to the year ago quarter. Operating
income of $342 million for the quarter represents an increase of 38 percent
compared to the 2000 third quarter operating income of $248 million. Excluding a
non-recurring gain in the 2000 third quarter, operating income more than
doubled. Compared to the 2001 second quarter, operating income increased $70
million on increased revenues of $52 million. Both the Energy Services Group and
Engineering and Construction Group contributed to these improved results.
"Both our business segments delivered outstanding results," commented Dave
Lesar, Halliburton's chairman of the board, president and chief executive
officer. "Our performance in the quarter highlights the earnings capacity of
this dynamic organization. While the near-term industry outlook is less robust,
the longer-term fundamentals are strong. Our global presence and market leading
products and services position us extremely well to perform under all market
conditions."
2001 Third Quarter Segment Results
The Energy Services Group segment posted 2001 third quarter revenues of
$2.3 billion representing an increase of 33 percent compared to the 2000 third
quarter. Energy Services Group revenues in the United States increased by three
percent from the 2001 second quarter, while international revenues increased by
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over five precent. Within the Energy Servcies Group, revenues at Halliburton
Energy Services increased 32 percent compared to the 2000 third quarter and
increased for all geographic regions and product service lines over the same
time period.
Operating income for the Energy Services Group segment was $321 million, an
increase of 41 percent from the 2000 third quarter. Excluding last year's $88
million gain on the sale of marine vessels, operating income increased 129
percent, and operating margins increased from eight percent to 14 percent.
Operating income improvements for the segment were driven by Halliburton Energy
Services, where operating income increased over 135 percent compared to the 2000
third quarter and increased 15 percent compared to the 2001 second quarter.
Operating margins within Halliburton Energy Services were 17 percent compared to
nine percent a year earlier. Incremental margins at Halliburton Energy Services
for the quarter were 74 percent sequentially. Surface/Subsea businesses and
Landmark Graphics also posted strong operating profits during the quarter.
The Engineering and Construction Group's 2001 third quarter revenues were
$1.1 billion, down from the $1.3 billion reported in the 2000 third quarter due
to the completion of several large projects. Operating income of $39 million for
the 2001 third quarter generated an operating margin of 3.6 percent, consistent
with the prior year quarter and up from 2.2 percent last quarter. Backlog for
the group increased from $6.3 billion at the beginning of the quarter to $7.1
billion at the end of the quarter.
Discontinued Operations
The net loss from discontinued operations was $2 million after-tax, which
reflects asbestos-related expenses on previously disposed businesses.
Technology and Significant Achievements
Halliburton has recently announced a number of advances in technology and
new contract awards including:
o PT Brown & Root Indonesia, an affiliate of Kellogg Brown & Root, has been
awarded a contract to provide project management, engineering, procurement,
construction and installation (EPCI) services for the Conoco Belanak
floating production, storage and offloading vessel (FPSO). Conoco Indonesia
Inc., Ltd. has been awarded the work under its production sharing contract
with Pertamina, the Indonesian state oil and gas company.
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The FPSO will be located in Conoco-operated South Natuna Sea Block B in
Indonesian waters, approximately 200km northeast of Singapore. The EPCI
contract, valued at just under $600 million, will take three years to
complete from contract signing to first production in late 2004.
o Kellogg Brown & Root, and its joint venture partner JGC Corporation, have
been selected by Shell Gas & Power (Shell) as contractor for its first
large scale Gas to Liquids project. The joint venture's contract covers the
definition of the engineering design. The location of the first project has
yet to be determined, but an investment decision is expected by the end of
2002. Shell intends to commit to up to four projects by the end of 2010.
o Halliburton Energy Services announced the extension of its high-speed
satellite communications network into Africa. Using the high-speed HalLink
satellite network, data can now be transmitted to Halliburton's Real Time
Operations Centers or visualization rooms, to the customer's office via the
Internet or, with connectivity, to any asset team member at any location.
This flexibility allows Halliburton and its customers to collaborate, share
knowledge, and solve problems almost instantly from any point on the globe.
Operators have the ability to optimize performance and maximize the
economic recovery of oil and gas reserves by shortening the time between
gathering information and making/executing decisions.
o Kellogg Brown & Root's Government Operations team has been selected by the
United States Department of Defense's (DOD) Defense Threat Reduction Agency
to participate in the Cooperative Threat Reduction (CTR) program. The CTR
program was established by the DOD to respond to the threat of
proliferation of nuclear, chemical and biological weapons of mass
destruction from the states of the Former Soviet Union. The Kellogg Brown &
Root team is one of five contracting teams chosen under a five-year initial
contract, with one five-year option based on performance for an estimated
$5 billion.
o Halliburton successfully completed the first application of its H2Zero
(TM) conformance solution in the Gulf of Mexico, reducing the Water-to-Gas
Ratio (WGR) by 96 percent. The solution was applied to an ExxonMobil-
operated well in the Mississippi Canyon Field, which had previously been
shut-in due to excess water production. With the successful reduction to
the WGR, the well has now been brought back on line. Originally developed
for the North Sea, the H2Zero (TM) solution is an environmentally sensitive
polymer system that provides exceptional capabilities for controlling
unwanted water and gas production. It is the only system that has performed
consistently at higher temperature ranges, up to 300O F.
o Landmark Graphics Corporation and Accenture announced the signing of an
alliance that will help the upstream oil and gas industry reap new
efficiencies from its vast global complex of processes, operations and
computer systems. The pairing combines industry-focused skills in
consulting, data management, applications hosting and outsourcing and spans
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more than 100 countries. The aim is to increase production revenue and
paring the billions of dollars in operational costs incurred by the
upstream oil and gas industry. The alliance will focus initially on
five critical operational issues for industry executives today: integration
of technical applications and business analysis, better decision-making
through virtual collaboration, effective process management by using a
common workflow structure, effective knowledge management and outsourcing
to enable executives to focus on their core businesses.
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 June 30, 2001 for a more
complete discussion of such risk factors.
###
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HALLIBURTON COMPANY
Consolidated Statements of Income
(Unaudited)
Quarter Ended Nine Months Ended
September 30 September 30
---------------------------- ---------------------------
2001 2000 2001 2000
------------ ------------ ------------ -----------
Millions of dollars except per share data
Revenues
Energy Services Group $ 2,309 $ 1,736 $ 6,554 $ 4,774
Engineering and Construction Group 1,082 1,288 3,320 3,977
------------ ------------ ------------ -----------
Total revenues $ 3,391 $ 3,024 $ 9,874 $ 8,751
============ ============ ============ ===========
Operating income
Energy Services Group $ 321 $ 228 $ 788 $ 390
Engineering and Construction Group 39 46 82 125
General corporate (18) (26) (58) (60)
------------ ------------ ------------ -----------
Total operating income 342 248 812 455
Interest expense (34) (38) (115) (104)
Interest income 8 6 18 16
Foreign currency losses, net (2) 4 (6) (3)
Other nonoperating, net - (1) - (1)
------------ ------------ ------------ -----------
Income from continuing operations before
income taxes, minority interests, and change
in accounting method 314 219 709 363
Provision for income taxes (126) (84) (285) (140)
Minority interest in net income of subsidiaries (7) (5) (14) (14)
------------ ------------ ------------ -----------
Income from continuing operations
before change in accounting method 181 130 410 209
Discontinued operations, net
Income (loss) from discontinued operations (2) 27 (40) 72
Gain on disposal of discontinued operations - - 299 215
------------ ------------ ------------ -----------
Income from discontinued operations (2) 27 259 287
------------ ------------ ------------ -----------
Cumulative effect of change in accounting
method, net - - 1 -
------------ ------------ ------------ -----------
Net income $ 179 $ 157 $ 670 $ 496
============ ============ ============ ===========
Basic income per share:
Continuing operations $ 0.42 $ 0.29 $ 0.96 $ 0.47
Discontinued operations, net
Income (loss) from discontinued operations - 0.06 (0.09) 0.16
Gain on disposal of discontinued operations - - 0.70 0.49
------------ ------------ ------------ -----------
Income from discontinued operations - 0.06 0.61 0.65
------------ ------------ ------------ -----------
Net income $ 0.42 $ 0.35 $ 1.57 $ 1.12
============ ============ ============ ===========
Diluted income per share:
Continuing operations $ 0.42 $ 0.29 $ 0.95 $ 0.47
Discontinued operations, net
Income (loss) from discontinued operations - 0.06 (0.09) 0.16
Gain on disposal of discontinued operations - - 0.70 0.48
------------ ------------ ------------ -----------
Income from discontinued operations - 0.06 0.61 0.64
------------ ------------ ------------ -----------
Net income $ 0.42 $ 0.35 $ 1.56 $ 1.11
============ ============ ============ ===========
Basic average common shares outstanding 428 445 427 444
Diluted average common shares outstanding 429 451 430 448
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