Weatherford Sees 28% Increase in Earnings

Weatherford International Ltd. (NYSE: WFT) reported second quarter 2007 net income of $235.0 million from continuing operations, or $0.68 per diluted share, before non-recurring items. Second quarter diluted earnings per share from continuing operations reflect an improvement of 28 percent over the second quarter of 2006 diluted earnings per share from continuing operations of $0.53, before non-recurring items. The non-recurring items in the second quarter of 2007 results include severance associated with the company's second quarter restructuring activities of $8.6 million, after tax, and $50.0 million of expense for withholding taxes on a distribution made by the company to one of its foreign subsidiaries.

Second quarter revenues were $1,815.9 million, or 18 percent higher than the same period last year, against a backdrop of a two percent increase in rig activity.

Sequentially, the company's second quarter diluted earnings per share from continuing operations were lower than the record first quarter 2007 diluted earnings per share from continuing operations of $0.83, before non-recurring items, primarily due to an unusually severe seasonal downturn in the Canadian market.

In the first six months of 2007, revenues were $3.7 billion and income from continuing operations before charges was $521.5 million, or $1.50 per diluted share. In 2006, the company reported revenues for the first six months of $3.1 billion and income from continuing operations before charges of $396.8 million, or $1.11 per diluted share.

North America

Revenues for the quarter were $883.4 million. This is a five percent increase over the same quarter in the prior year, as compared to a one percent rig count decline. Growth in the U.S. rig count was more than offset by a 51% drop in the Canadian rig count. Sequentially, revenues decreased 12 percent, as compared to a 16 percent decline in rig count, driven by a 72% sequential decline in the Canadian rig count. In Canada, all product lines declined. In the U.S., artificial lift, completion, wireline, drilling services and chemicals & stimulation performed exceptionally well.

Operating income of $192.3 million was 14 percent lower than the same quarter in the prior year and 36 percent lower than the preceding quarter. The sharp drop in Canadian activity negatively impacted operating margins.

Latin America

Second quarter revenues of $206.6 million were 16 percent higher than the second quarter of 2006 and essentially flat with the prior quarter. This region's performance reflected the strongest sequential growth in its artificial lift, drilling services and well construction product lines.

The current quarter's operating income of $45.7 million improved 36 percent as compared to the same quarter in the prior year and decreased six percent as compared to the first quarter of 2007. Sequentially, the decrease in operating income was primarily driven by decreased activity in Venezuela's Orinoco basin, where the company has a substantial share of the heavy oil market.

Europe/West Africa/CIS

Second quarter revenues of $290.6 million were 42 percent higher than the second quarter of 2006 and 19 percent higher than the prior quarter. This region improved across all product lines with the strongest growth in the completion, drilling services, wireline and drilling tools product lines.

The current quarter's operating income of $68.8 million improved 52 percent as compared to the same quarter in the prior year and 26 percent as compared to the first quarter of 2007.

Middle East/North Africa/Asia

Second quarter revenues of $435.3 million were 38 percent higher than the second quarter of 2006 and 10 percent higher than the prior quarter. This region's performance reflected sequential improvements in its drilling services, artificial lift, completion and drilling tools service lines.

The current quarter's operating income of $97.0 million improved 68 percent as compared to the same quarter in the prior year and 16 percent as compared to the prior quarter.

Discontinued Operations

The company is disposing of an R&D driven investment in producing oilfield assets. The results of operations of this business for the current and prior periods are reflected as discontinued operations, net of taxes. For the three months ended June 30, 2007, the loss per diluted share from discontinued operations was $0.03.

Reclassifications and Non-GAAP

Non-GAAP performance measures and corresponding reconciliations to GAAP financial measures have been provided for meaningful comparisons between current results and results in prior operating periods.

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