Weatherford Sets Earnings Record in 4Q, Gains 8% Increase
Weatherford has reported fourth quarter 2008 income from continuing operations of $364 million, or $0.53 per diluted share, excluding an after tax loss of $0.03 for investigation and exit costs incurred in connection with the company's withdrawal from sanctioned countries. Fourth quarter diluted earnings per share from continuing operations reflect an improvement of eight percent over the fourth quarter of 2007 diluted earnings per share from continuing operations of $0.49, before non-recurring items.
Fourth quarter revenues were $2,635 million, or 20 percent higher than the same period last year, against a backdrop of an 8 percent increase in rig count activity. This is the highest level of quarterly revenue in the company's history.
Sequentially, the company's fourth quarter diluted earnings per share from continuing operations, before non-recurring items, were $0.02 lower than the third quarter 2008 diluted earnings per share from continuing operations of $0.55, before non-recurring items. Fourth quarter results of operations include a loss of $0.04 cents per diluted share for declines in the value of foreign-denominated assets due to movements in exchange rates and $0.03 cents per diluted share for asset write offs and facility moving costs. In addition, pullbacks in North America and Russia, as well as the unfavorable impact of a stronger U.S. dollar, generated headwinds to revenue and operating income growth.
For the year ended December 31, 2008, revenues were $9.6 billion, 23% higher than 2007, and income from continuing operations before non-recurring items was $1,399 million, or $2.00 per diluted share, an increase of 20% from 2007. In 2007, the company reported revenues for the year of $7.8 billion and income from continuing operations before non-recurring items of $1,164 million, or $1.67 per diluted share.
Revenues for the quarter were $1,178 million, which is a 12 percent increase over the same quarter in the prior year, as compared to a seven percent rig count increase. Sequentially, revenues were flat as an increase in the United States was offset by a decrease in Canada due to the weakening of the Canadian dollar. Our stimulation & chemicals and directional & underbalanced service lines were our best performers on a sequential basis. All product lines grew compared to 2007 full-year results, other than pipeline and drilling tools.
Operating income of $296 million was 16 percent higher than the same quarter in the prior year and five percent lower sequentially.
Middle East/North Africa/Asia
Fourth quarter revenues of $676 million were 26 percent higher than the fourth quarter of 2007 and six percent higher than the prior quarter. Algeria, Saudi Arabia, Oman and India were standout performers. By product line, directional & underbalanced, integrated drilling and well construction all experienced significant increases.
The current quarter's operating income of $163 million improved 24 percent as compared to the same quarter in the prior year and increased 11 percent as compared to the prior quarter.
Fourth quarter revenues of $393 million were 14 percent higher than the fourth quarter of 2007 and four percent lower than the prior quarter. Revenue declines in Russia, combined with the weakening of local currencies against the U.S. dollar, more than offset improvements in Central Europe and West Africa. Our directional & underbalanced and stimulation & chemicals service lines experienced the most growth on a sequential and year over year basis.
The current quarter's operating income of $88 million declined three percent as compared to the same quarter in the prior year and 14 percent sequentially, in part due to charges related to facility moves and severance at an entity in which the company owns a minority interest.
Fourth quarter revenues of $388 million were 52 percent higher than the fourth quarter of 2007 and 23 percent higher than the prior quarter. Mexico, Brazil, Venezuela and Colombia posted strong results. Revenue grew sequentially across all product lines, with artificial lift, directional & underbalanced and integrated drilling standing out as the top performers.
The current quarter's operating income of $89 million improved 40 percent as compared to the same quarter in the prior year and was 28 percent higher when compared to the third quarter of 2008.
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