Weatherford reported third quarter 2011 income of $197 million, or $0.26 per diluted share, excluding an after-tax loss of $7 million. On a GAAP basis, our net income for the third quarter of 2011 was $190 million, or $0.25 per diluted share. The excluded after-tax loss is comprised of $6 million in severance and exit charges and $1 million in government investigation costs.
Third quarter diluted earnings per share reflects an increase of $0.15, or 136 percent, over the third quarter of 2010 diluted earnings per share of $0.11, before charges. Sequentially, the company's third quarter diluted earnings per share, before charges, was $0.09, or 53 percent, higher than the second quarter of 2011. Field operations drove the entire sequential improvement in profitability. Two non-operating items partially offset operating improvements. First, foreign exchange book losses of $20 million at Weatherford recorded in Other, Net and our share of similar foreign exchange book losses at a minority-owned subsidiary in Russia, which reduced regional operating income by an additional $8 million. Second, a higher sequential effective tax rate reduced net income by $7 million.
Third quarter revenues of $3.37 billion were the highest in the company's history. Revenues were 33 percent higher than the same period last year and 11 percent higher than the prior quarter. North America revenue was up 21 percent sequentially and up 48 percent versus the third quarter of 2010. The sequential increase in North America was partially due to seasonal recovery from the Canadian break-up experienced in the second quarter of 2011. International revenues were up three percent sequentially and up 22 percent versus the same quarter of 2010.
Segment operating income of $525 million improved 42 percent year-over-year and 25 percent sequentially. The company's North America operations provided all of the sequential growth compared to the second quarter of 2011 and delivered 39 percent incremental margins. Internationally, Latin America was the strongest contributor with respect to revenue and profit growth. An $8 million foreign exchange book loss at one of the company's minority-owned subsidiaries in Russia weighed on Eastern Hemisphere earnings, as the venture recorded a currency loss on its U.S. dollar-denominated debt due to a strengthening of the dollar versus the Russian rouble.
Subject to the risks regarding forward-looking statements highlighted by the company in this press release and its public filings, the company expects earnings per share before excluded items of approximately $0.30 to $0.34 in the fourth quarter of 2011, with profit growth expected in all reporting regions. With respect to 2012, the company maintains a positive but more measured outlook for its North American business and expects modest revenue growth and margin expansion as compared to 2011 annualized exit rates as a result of strong activity in Canada and in the U.S. oil market. Internationally, the company anticipates continued growth and expanding margins in its Latin America region, underpinned by improvements in Argentina, Brazil, Colombia, Mexico and Venezuela. Eastern Hemisphere is also expected to improve in 2012, with upticks in Europe and Russia, as well as a recovery in the Middle East / North Africa / Asia Pacific region with positive contributions from new contracts with better terms and pricing, the completion of existing contracts and activity improvements in North Africa.
Revenues for the quarter were $1.62 billion, which is a 48 percent increase over the same quarter in the prior year and up 21 percent sequentially. The Artificial Lift, Completion Systems, Wireline and Drilling Services product lines contributed strong results for the quarter.
The current quarter's operating income was $352 million, up $153 million from the third quarter of 2010, and was up $109 million, or 45 percent, compared to the prior quarter. Strong growth and steadily expanding margins in the U.S. and the recovery from the second quarter's Canadian break-up contributed to the sequential increase.
Middle East/North Africa/Asia
Third quarter revenues of $573 million were five percent lower than the third quarter of 2010 and seven percent lower than the prior quarter. The sequential decline in revenues was principally the result of the deconsolidation of three joint ventures and a decline in activity in Algeria.
The current quarter's operating income of $15 million decreased 77 percent as compared to the same quarter in the prior year and decreased $19 million compared to the second quarter of 2011. The mobilization of equipment out of Algeria pending additional tenders weighed on margins, as did a negative swing in Iraq profitability and continuing operating losses in Libya due to political disruptions.
Third quarter revenues of $589 million were 19 percent higher than the third quarter of 2010 and one percent lower than the prior quarter. The revenue growth over the same quarter of 2010 came from stronger performance in Russia and the North Sea.
The current quarter's operating income of $87 million was up 37 percent compared to the same quarter in the prior year and down $6 million compared to the prior quarter. The current quarter was negatively impacted by the $8 million of foreign exchange losses discussed above.
Third quarter revenues of $592 million were 76 percent higher than the third quarter of 2010 and up 19 percent compared to the second quarter of 2011. Mexico, Brazil and Venezuela posted strong sequential performances and nearly all product lines experienced quarter on quarter growth.
The current quarter's operating income of $71 million increased 73 percent as compared to the same quarter in the prior year and increased $20 million compared to the prior quarter.
Liquidity and Net Debt
Net debt for the quarter increased $301 million, with working capital increasing $333 million during the quarter.
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