|
|
|
þ
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
For the quarterly period ended March 31, 2013
|
|
|
|
o
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
Switzerland
|
|
9
8-0606750
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
|
|
|
|
4-6 Rue Jean-Francois Bartholoni, 1204 Geneva, Switzerland
|
|
Not Applicable
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
|
|
|
Large accelerated filer
þ
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
|
|
|
|
|
|
Page
|
|
|
|
|
|
|
|
2
|
|
20
|
|
30
|
|
32
|
|
|
|
|
|
34
|
|
34
|
|
34
|
|
35
|
|
36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2013
|
December 31,
2012
|
||||||
|
(Unaudited)
|
|
||||||
Current Assets:
|
|
|
||||||
Cash and Cash Equivalents
|
$
|
286
|
$
|
300
|
||||
Accounts Receivable, Net of Allowance for Uncollectible Accounts of $90 and $84
|
3,850
|
3,885
|
||||||
Inventories, Net
|
3,744
|
3,675
|
||||||
Current Deferred Tax Assets
|
371
|
376
|
||||||
Other Current Assets
|
806
|
793
|
||||||
Total Current Assets
|
9,057
|
9,029
|
||||||
|
||||||||
Property, Plant and Equipment, Net of Accumulated Depreciation of $6,203 and $6,030
|
8,299
|
8,299
|
||||||
Goodwill
|
3,765
|
3,871
|
||||||
Other Intangible Assets, Net of Accumulated Amortization of $678 and $658
|
720
|
766
|
||||||
Equity Investments
|
660
|
646
|
||||||
Other Non-current Assets
|
180
|
184
|
||||||
Total Assets
|
$
|
22,681
|
$
|
22,795
|
||||
|
||||||||
|
||||||||
Current Liabilities:
|
||||||||
Short-term Borrowings and Current Portion of Long-term Debt
|
$
|
1,896
|
$
|
1,585
|
||||
Accounts Payable
|
2,191
|
2,108
|
||||||
Other Current Liabilities
|
1,667
|
2,017
|
||||||
Total Current Liabilities
|
5,754
|
5,710
|
||||||
|
||||||||
Long-term Debt
|
7,032
|
7,049
|
||||||
Other Non-current Liabilities
|
1,197
|
1,218
|
||||||
Total Liabilities
|
13,983
|
13,977
|
||||||
|
||||||||
Shareholders' Equity:
|
||||||||
Shares, CHF 1.16 Par Value: Authorized 840, Conditionally Authorized 372, Issued 840 at March 31, 2013 and December 31, 2012
|
775
|
775
|
||||||
Capital in Excess of Par Value
|
4,635
|
4,674
|
||||||
Treasury Shares, at Cost
|
(139
|
)
|
(182
|
)
|
||||
Retained Earnings
|
3,378
|
3,356
|
||||||
Accumulated Other Comprehensive Income
|
14
|
163
|
||||||
Weatherford Shareholders' Equity
|
8,663
|
8,786
|
||||||
Noncontrolling Interests
|
35
|
32
|
||||||
Total Shareholders' Equity
|
8,698
|
8,818
|
||||||
Total Liabilities and Shareholders' Equity
|
$
|
22,681
|
$
|
22,795
|
|
Three Months
Ended March 31,
|
|||||||
|
2013
|
2012
|
||||||
Revenues:
|
|
|
||||||
Products
|
$
|
1,468
|
$
|
1,412
|
||||
Services
|
2,369
|
2,179
|
||||||
|
3,837
|
3,591
|
||||||
|
||||||||
Costs and Expenses:
|
||||||||
Cost of Products
|
1,145
|
1,053
|
||||||
Cost of Services
|
1,861
|
1,647
|
||||||
Research and Development
|
67
|
62
|
||||||
Selling, General and Administrative
Attributable to Segments
|
415
|
372
|
||||||
Corporate, General and Administrative
|
76
|
87
|
||||||
Gain on Sale of Business
|
(6
|
)
|
—
|
|||||
|
3,558
|
3,221
|
||||||
|
||||||||
Operating Income
|
279
|
370
|
||||||
|
||||||||
Interest Expense, Net
|
(131
|
)
|
(112
|
)
|
||||
Devaluation of Venezuelan Bolivar
|
(100
|
)
|
—
|
|||||
Other, Net
|
(13
|
)
|
(18
|
)
|
||||
|
||||||||
Income Before Income Taxes
|
35
|
240
|
||||||
Provision for Income Taxes
|
(5
|
)
|
(110
|
) | ||||
Net Income
|
30
|
130
|
||||||
|
||||||||
Net Income Attributable to Noncontrolling Interests
|
(8
|
)
|
(7
|
)
|
||||
Net Income Attributable to Weatherford
|
$
|
22
|
$
|
123
|
||||
|
||||||||
Earnings Per Share Attributable to Weatherford:
|
||||||||
Basic
|
$
|
0.03
|
$
|
0.16
|
||||
Diluted
|
$
|
0.03
|
$
|
0.16
|
||||
|
||||||||
Weighted Average Shares Outstanding:
|
||||||||
Basic
|
769
|
760
|
||||||
Diluted
|
773
|
766
|
|
Three Months
Ended March 31,
|
|||||||
|
2013
|
2012
|
||||||
|
|
|
||||||
Net Income
|
$
|
30
|
$
|
130
|
||||
Other Comprehensive Income:
|
||||||||
Foreign Currency Translation
|
(150
|
)
|
181
|
|||||
Defined Benefit Pension Activity
|
1
|
1
|
||||||
Other Comprehensive Income (Loss)
|
(149
|
)
|
182
|
|||||
Comprehensive Income (Loss)
|
(119
|
)
|
312
|
|||||
Comprehensive Income Attributable to Noncontrolling Interests
|
(8
|
)
|
(7
|
)
|
||||
Comprehensive Income (Loss) Attributable to Weatherford
|
$
|
(127
|
)
|
$
|
305
|
|
Ended March 31,
|
|||||||
|
2013
|
2012
|
||||||
Cash Flows from Operating Activities:
|
|
|
||||||
Net Income
|
$
|
30
|
$
|
130
|
||||
Adjustments to Reconcile Net Income to Net Cash Provided by (Used in) Operating Activities:
|
||||||||
Depreciation and Amortization
|
346
|
299
|
||||||
Employee Share-Based Compensation Expense
|
11
|
22
|
||||||
Deferred Income Tax Provision (Benefit)
|
(3
|
) |
19
|
|||||
Devaluation of Venezuelan Bolivar
|
100
|
—
|
||||||
Other, Net
|
(14
|
)
|
(10
|
)
|
||||
Change in Operating Assets and Liabilities, Net of Effect of Businesses Acquired:
|
||||||||
Accounts Receivable
|
(108
|
)
|
(110
|
)
|
||||
Inventories
|
(89
|
)
|
(157
|
)
|
||||
Billings in Excess of Costs and Estimated Earnings
|
(48
|
)
|
7
|
|||||
Other Current Assets
|
(33
|
)
|
16
|
|||||
Accounts Payable
|
130
|
87
|
||||||
Other Current Liabilities
|
(320
|
)
|
(137
|
)
|
||||
Other
|
(13
|
)
|
(26
|
)
|
||||
Net Cash Provided by (Used in) Operating Activities
|
(11
|
)
|
140
|
|||||
|
||||||||
Cash Flows from Investing Activities:
|
||||||||
Capital Expenditures for Property, Plant and Equipment
|
(400
|
)
|
(514
|
)
|
||||
Acquisitions of Businesses, Net of Cash Acquired
|
(4
|
)
|
(12
|
)
|
||||
Acquisition of Intellectual Property
|
(1
|
)
|
(3
|
)
|
||||
Proceeds from Sale of Assets and Businesses, Net
|
85
|
5
|
||||||
Net Cash Used by Investing Activities
|
(320
|
)
|
(524
|
)
|
||||
|
||||||||
Cash Flows from Financing Activities:
|
||||||||
Borrowings (Repayments) of Long-term Debt, Net
|
(304
|
)
|
1
|
|||||
Borrowings of Short-term Debt, Net
|
625
|
285
|
||||||
Proceeds from Exercise of Warrants
|
—
|
65
|
||||||
Other Financing Activities, Net
|
(3
|
)
|
(2
|
)
|
||||
Net Cash Provided by Financing Activities
|
318
|
349
|
||||||
|
||||||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents, Excluding Devaluation of Venezuelan Bolivar
|
(1
|
)
|
3
|
|||||
|
||||||||
Net Decrease in Cash and Cash Equivalents
|
(14
|
)
|
(32
|
)
|
||||
Cash and Cash Equivalents at Beginning of Period
|
300
|
371
|
||||||
Cash and Cash Equivalents at End of Period
|
$
|
286
|
$
|
339
|
||||
|
||||||||
Supplemental Cash Flow Information:
|
||||||||
Interest Paid
|
$
|
183
|
$
|
180
|
||||
Income Taxes Paid, Net of Refunds
|
124
|
98
|
1.
|
General
|
2.
|
Business Combinations and Dispositions
|
|
March 31,
2013
|
December 31,
2012
|
||||||
|
|
|||||||
|
|
|
||||||
Raw materials, components and supplies
|
$
|
472
|
$
|
461
|
||||
Work in process
|
173
|
166
|
||||||
Finished goods
|
3,099
|
3,048
|
||||||
|
$
|
3,744
|
$
|
3,675
|
|
North America
|
MENA/
Asia Pacific
|
Europe/
SSA/ Russia
|
Latin
America
|
Total
|
|||||||||||||||
|
(In millions)
|
|||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
As of December 31, 2012
|
$
|
2,336
|
$
|
226
|
$
|
955
|
$
|
354
|
$
|
3,871
|
||||||||||
Acquisitions
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Disposals
|
(23
|
)
|
(4
|
)
|
(13
|
)
|
(1
|
)
|
(41
|
)
|
||||||||||
Purchase price and other adjustments
|
(5
|
)
|
—
|
(3
|
)
|
2
|
(6
|
)
|
||||||||||||
Foreign currency translation
|
(28
|
)
|
—
|
(31
|
)
|
—
|
(59
|
)
|
||||||||||||
As of March 31, 2013
|
$
|
2,280
|
$
|
222
|
$
|
908
|
$
|
355
|
$
|
3,765
|
|
March 31,
2013
|
December 31,
2012
|
||||||
|
(In millions)
|
|||||||
|
|
|
||||||
Commercial paper
|
$
|
893
|
$
|
888
|
||||
Revolving credit facility
|
643
|
—
|
||||||
Other short-term bank loans
|
67
|
109
|
||||||
Total short-term borrowings
|
1,603
|
997
|
||||||
Current portion of long-term debt
|
293
|
588
|
||||||
Short-term borrowings and current portion of long-term debt
|
$
|
1,896
|
$
|
1,585
|
|
March 31,
2013
|
December 31, 2012
|
||||||
|
(In millions)
|
|||||||
|
|
|
||||||
Fair value
|
$
|
7,973
|
$
|
8,368
|
||||
Carrying value
|
7,059
|
7,355
|
|
March 31,
2013
|
December31, 2012
|
Classifications
|
||||||
|
(In millions)
|
|
|||||||
Derivative assets not designated as hedges:
|
|||||||||
Foreign currency forward contracts
|
$ | 15 | $ | 5 |
Other Current Assets
|
||||
|
|
||||||||
Derivative liabilities not designated as hedges:
|
|||||||||
Foreign currency forward contracts
|
(7
|
)
|
(20
|
)
|
Other Current Liabilities
|
||||
Cross-currency swap contracts
|
(29
|
)
|
(34
|
)
|
Other Liabilities
|
|
Issued
Shares
|
Capital In Excess of Par Value
|
Retained Earnings
|
Accumulated Other Comprehensive Income (Loss)
|
Treasury Shares
|
Noncontrolling Interests
|
Total Shareholders' Equity
|
|||||||||||||||||||||
|
|
(In millions)
|
|
|||||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||||||
Balance at December 31, 2011
|
$
|
769
|
$
|
4,675
|
$
|
4,134
|
$
|
80
|
$
|
(334
|
)
|
$
|
21
|
$
|
9,345
|
|||||||||||||
Net Income
|
—
|
—
|
123
|
—
|
—
|
7
|
130
|
|||||||||||||||||||||
Other Comprehensive Income
|
—
|
—
|
—
|
182
|
—
|
—
|
182
|
|||||||||||||||||||||
Dividends Paid to Noncontrolling
Interests
|
—
|
—
|
—
|
—
|
—
|
(7
|
)
|
(7
|
)
|
|||||||||||||||||||
Equity Awards Granted, Vested and
Exercised
|
—
|
(21
|
)
|
—
|
—
|
32
|
—
|
11
|
||||||||||||||||||||
Other
|
6
|
58
|
—
|
—
|
—
|
—
|
64
|
|||||||||||||||||||||
Balance at March 31, 2012
|
$
|
775
|
$
|
4,712
|
$
|
4,257
|
$
|
262
|
$
|
(302
|
)
|
$
|
21
|
$
|
9,725
|
|||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance at December 31, 2012
|
$
|
775
|
$
|
4,674
|
$
|
3,356
|
$
|
163
|
$
|
(182
|
)
|
$
|
32
|
$
|
8,818
|
|||||||||||||
Net Income
|
—
|
—
|
22
|
—
|
—
|
8
|
30
|
|||||||||||||||||||||
Other Comprehensive (Loss)
|
—
|
—
|
—
|
(149
|
)
|
—
|
—
|
(149
|
)
|
|||||||||||||||||||
Dividends Paid to Noncontrolling
Interests
|
—
|
—
|
—
|
—
|
—
|
(5
|
)
|
(5
|
)
|
|||||||||||||||||||
Equity Awards Granted, Vested and
Exercised
|
—
|
(39
|
)
|
—
|
—
|
43
|
—
|
4
|
||||||||||||||||||||
Other
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||
Balance at March 31, 2013
|
$
|
775
|
$
|
4,635
|
$
|
3,378
|
$
|
14
|
$
|
(139
|
)
|
$
|
35
|
$
|
8,698
|
|
Currency
Translation
Adjustment
|
Defined
Benefit
Pension
|
Deferred
Loss on
Derivatives
|
Total
|
||||||||||||
|
|
|||||||||||||||
|
|
|
|
|
||||||||||||
Balance at December 31, 2011
|
$
|
127
|
$
|
(36
|
)
|
$
|
(11
|
)
|
$
|
80
|
||||||
|
||||||||||||||||
Other comprehensive income before reclassifications
|
181
|
—
|
—
|
181
|
||||||||||||
Reclassifications
|
—
|
1
|
—
|
1
|
||||||||||||
Net activity
|
181
|
1
|
—
|
182
|
||||||||||||
|
||||||||||||||||
Balance at March 31, 2012
|
$
|
308
|
$
|
(35
|
)
|
$
|
(11
|
)
|
$
|
262
|
||||||
|
||||||||||||||||
Balance at December 31, 2012
|
$
|
213
|
$
|
(40
|
)
|
$
|
(10
|
)
|
$
|
163
|
||||||
|
||||||||||||||||
Other comprehensive (loss) before reclassifications
|
(116
|
)
|
—
|
—
|
(116
|
)
|
||||||||||
Reclassifications
|
(34
|
)
|
1
|
—
|
(33
|
)
|
||||||||||
Net activity
|
(150
|
)
|
1
|
—
|
(149
|
)
|
||||||||||
|
||||||||||||||||
Balance at March 31, 2013
|
$
|
63
|
$
|
(39
|
)
|
$
|
(10
|
)
|
$
|
14
|
|
Three Months
Ended March 31,
|
|||||||
|
2013
|
2012
|
||||||
|
|
|||||||
Basic weighted average shares outstanding
|
769
|
760
|
||||||
Dilutive effect of:
|
||||||||
Stock options, restricted shares and performance units
|
4
|
5
|
||||||
Warrants
|
—
|
1
|
||||||
Diluted weighted average shares outstanding
|
773
|
766
|
12. | Share-Based Compensation |
|
Ended March 31
|
|||||||
|
2013
|
2012
|
||||||
|
(In millions)
|
|||||||
Share-based compensation
|
$
|
11
|
$
|
22
|
||||
Related tax benefit
|
4
|
8
|
|
Three Months Ended March 31, 2013
|
|||||||||||
|
Net
Operating
Revenues
|
Income
from
Operations
|
Depreciation
and
Amortization
|
|||||||||
|
(In millions)
|
|||||||||||
|
|
|
|
|||||||||
North America
|
$
|
1,692
|
$
|
224
|
$
|
108
|
||||||
MENA/Asia Pacific
|
785
|
42
|
93
|
|||||||||
Europe/SSA/Russia
|
633
|
65
|
71
|
|||||||||
Latin America
|
727
|
98
|
68
|
|||||||||
|
3,837
|
429
|
340
|
|||||||||
Corporate and Research and Development
|
—
|
(115
|
)
|
6
|
||||||||
Other (a)
|
—
|
(35
|
)
|
—
|
||||||||
Total
|
$
|
3,837
|
$
|
279
|
$
|
346
|
||||||
|
||||||||||||
|
Three Months Ended March 31, 2012
|
|||||||||||
|
Net
Operating
Revenues
|
Income
from
Operations
|
Depreciation
and
Amortization
|
|||||||||
|
(In millions)
|
|||||||||||
|
||||||||||||
North America
|
$
|
1,754
|
$
|
358
|
$
|
95
|
||||||
MENA/Asia Pacific
|
595
|
22
|
83
|
|||||||||
Europe/SSA/Russia
|
571
|
66
|
61
|
|||||||||
Latin America
|
671
|
83
|
55
|
|||||||||
|
3,591
|
529
|
294
|
|||||||||
Corporate and Research and Development
|
—
|
(112
|
)
|
5
|
||||||||
Other (b)
|
—
|
(47
|
)
|
—
|
||||||||
Total
|
$
|
3,591
|
$
|
370
|
$
|
299
|
(a) | The three months ended March 31, 2013 includes income tax restatement and material weakness remediation expenses of $21 million, severance, exit and other charges of $20 million, partially offset by a $6 million gain on the sale of our industrial screen business. |
(b) |
The three months ended March 31, 2012 includes $31 million for severance and exit costs, income tax restatement and remediation expenses of $14 million and $2 million for lega
l and professional fees incurred in connection with our on-going investigations.
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
Current Assets:
|
|
|
|
|
|
|
||||||||||||||||||
Cash and Cash Equivalents
|
$
|
—
|
$
|
1
|
$
|
—
|
$
|
285
|
$
|
—
|
$
|
286
|
||||||||||||
Other Current Assets
|
5
|
30
|
219
|
8,722
|
(205
|
)
|
8,771
|
|||||||||||||||||
Total Current Assets
|
5
|
31
|
219
|
9,007
|
(205
|
)
|
9,057
|
|||||||||||||||||
|
||||||||||||||||||||||||
Equity Investments in Affiliates
|
9,071
|
14,985
|
7,792
|
8,457
|
(40,305
|
)
|
—
|
|||||||||||||||||
Shares Held in Parent
|
—
|
—
|
10
|
129
|
(139
|
)
|
—
|
|||||||||||||||||
Intercompany Receivables, Net
|
—
|
2,011
|
—
|
—
|
(2,011
|
)
|
—
|
|||||||||||||||||
Other Non-current Assets
|
17
|
43
|
14
|
13,550
|
—
|
13,624
|
||||||||||||||||||
Total Assets
|
$
|
9,093
|
$
|
17,070
|
$
|
8,035
|
$
|
31,143
|
$
|
(42,660
|
)
|
$
|
22,681
|
|||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Current Liabilities:
|
||||||||||||||||||||||||
Short-term Borrowings and Current Portion of Long-term Debt
|
$
|
—
|
$
|
1,792
|
$
|
22
|
$
|
82
|
$
|
—
|
$
|
1,896
|
||||||||||||
Accounts Payable and Other
Current Liabilities
|
—
|
172
|
—
|
3,891
|
(205
|
)
|
3,858
|
|||||||||||||||||
Total Current Liabilities
|
—
|
1,964
|
22
|
3,973
|
(205
|
)
|
5,754
|
|||||||||||||||||
|
||||||||||||||||||||||||
Long-term Debt
|
—
|
5,893
|
1,012
|
127
|
—
|
7,032
|
||||||||||||||||||
Intercompany Payables,
Net
|
416
|
—
|
470
|
1,126
|
(2,012
|
)
|
—
|
|||||||||||||||||
Other Non-current Liabilities
|
14
|
77
|
2
|
1,104
|
—
|
1,197
|
||||||||||||||||||
Total Liabilities
|
430
|
7,934
|
1,506
|
6,330
|
(2,217
|
)
|
13,983
|
|||||||||||||||||
|
||||||||||||||||||||||||
Weatherford Shareholders' Equity
|
8,663
|
9,136
|
6,529
|
24,778
|
(40,443
|
)
|
8,663
|
|||||||||||||||||
Noncontrolling Interests
|
—
|
—
|
—
|
35
|
—
|
35
|
||||||||||||||||||
Total Liabilities and Shareholders' Equity
|
$
|
9,093
|
$
|
17,070
|
$
|
8,035
|
$
|
31,143
|
$
|
(42,660
|
)
|
$
|
22,681
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
Current Assets:
|
|
|
|
|
|
|
||||||||||||||||||
Cash and Cash Equivalents
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
300
|
$
|
—
|
$
|
300
|
||||||||||||
Other Current Assets
|
5
|
5
|
256
|
8,682
|
(219
|
)
|
8,729
|
|||||||||||||||||
Total Current Assets
|
5
|
5
|
256
|
8,982
|
(219
|
)
|
9,029
|
|||||||||||||||||
|
||||||||||||||||||||||||
Equity Investments in Affiliates
|
9,184
|
14,790
|
7,675
|
8,458
|
(40,107
|
)
|
—
|
|||||||||||||||||
Shares Held in Parent
|
—
|
—
|
10
|
172
|
(182
|
)
|
—
|
|||||||||||||||||
Intercompany Receivables,
Net
|
—
|
1,872
|
—
|
—
|
(1,872
|
)
|
—
|
|||||||||||||||||
Other Non-current Assets
|
17
|
45
|
14
|
13,690
|
—
|
13,766
|
||||||||||||||||||
Total Assets
|
$
|
9,206
|
$
|
16,712
|
$
|
7,955
|
$
|
31,302
|
$
|
(42,380
|
)
|
$
|
22,795
|
|||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Current Liabilities:
|
||||||||||||||||||||||||
Short-term Borrowings and
Current Portion of Long-term Debt
|
$
|
—
|
$
|
1,439
|
$
|
26
|
$
|
120
|
$
|
—
|
$
|
1,585
|
||||||||||||
Accounts Payable and Other
Current Liabilities
|
8
|
246
|
—
|
4,089
|
(218
|
)
|
4,125
|
|||||||||||||||||
Total Current Liabilities
|
8
|
1,685
|
26
|
4,209
|
(218
|
)
|
5,710
|
|||||||||||||||||
|
||||||||||||||||||||||||
Long-term Debt
|
—
|
5,895
|
1,019
|
135
|
—
|
7,049
|
||||||||||||||||||
Intercompany Payables,
Net
|
400
|
—
|
477
|
995
|
(1,872
|
)
|
—
|
|||||||||||||||||
Other Non-current Liabilities
|
12
|
76
|
3
|
1,127
|
—
|
1,218
|
||||||||||||||||||
Total Liabilities
|
420
|
7,656
|
1,525
|
6,466
|
(2,090
|
)
|
13,977
|
|||||||||||||||||
|
||||||||||||||||||||||||
Weatherford Shareholders'
Equity
|
8,786
|
9,056
|
6,430
|
24,804
|
(40,290
|
)
|
8,786
|
|||||||||||||||||
Noncontrolling Interests
|
—
|
—
|
—
|
32
|
—
|
32
|
||||||||||||||||||
Total Liabilities and
Shareholders' Equity
|
$
|
9,206
|
$
|
16,712
|
$
|
7,955
|
$
|
31,302
|
$
|
(42,380
|
)
|
$
|
22,795
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||
Revenues
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
3,837
|
$
|
—
|
$
|
3,837
|
||||||||||||
Costs and Expenses
|
(9
|
)
|
10
|
—
|
(3,559
|
)
|
—
|
(3,558
|
)
|
|||||||||||||||
Operating Income (Loss)
|
(9
|
)
|
10
|
—
|
278
|
—
|
279
|
|||||||||||||||||
|
||||||||||||||||||||||||
Other Income (Expense):
|
||||||||||||||||||||||||
Interest Income (Expense), Net
|
—
|
(111
|
)
|
(16
|
)
|
(4
|
)
|
—
|
(131
|
)
|
||||||||||||||
Intercompany Charges, Net
|
—
|
—
|
30
|
(30
|
)
|
—
|
—
|
|||||||||||||||||
Equity in Subsidiary Income (Loss)
|
31
|
195
|
117
|
—
|
(343
|
)
|
—
|
|||||||||||||||||
Other, Net
|
—
|
(14
|
)
|
—
|
(99
|
)
|
—
|
(113
|
)
|
|||||||||||||||
Income (Loss) Before Income Taxes
|
22
|
80
|
131
|
145
|
(343
|
)
|
35
|
|||||||||||||||||
Provision for Income Taxes
|
—
|
—
|
(6
|
)
|
1
|
—
|
(5
|
)
|
||||||||||||||||
Net Income (Loss)
|
22
|
80
|
125
|
146
|
(343
|
)
|
30
|
|||||||||||||||||
Noncontrolling Interests
|
—
|
—
|
—
|
(8
|
)
|
—
|
(8
|
)
|
||||||||||||||||
Net Income (Loss) Attributable to Weatherford
|
$
|
22
|
$
|
80
|
$
|
125
|
$
|
138
|
$
|
(343
|
)
|
$
|
22
|
|||||||||||
Comprehensive Income (Loss) Attributable to Weatherford
|
$
|
(127
|
)
|
$
|
(71
|
) |
$
|
(14
|
) |
$
|
(12
|
) |
$
|
97
|
|
$
|
(127
|
)
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||
Revenues
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
3,591
|
$
|
—
|
$
|
3,591
|
||||||||||||
Costs and Expenses
|
(16
|
)
|
(1
|
)
|
(1
|
)
|
(3,203
|
)
|
—
|
(3,221
|
)
|
|||||||||||||
Operating Income (Loss)
|
(16
|
)
|
(1
|
)
|
(1
|
)
|
388
|
—
|
370
|
|||||||||||||||
|
||||||||||||||||||||||||
Other Income (Expense):
|
||||||||||||||||||||||||
Interest Income (Expense), Net
|
—
|
(89
|
)
|
(19
|
)
|
(4
|
)
|
—
|
(112
|
)
|
||||||||||||||
Intercompany Charges, Net
|
—
|
8
|
25
|
(33
|
)
|
—
|
—
|
|||||||||||||||||
Equity in Subsidiary Income (Loss)
|
139
|
261
|
254
|
—
|
(654
|
)
|
—
|
|||||||||||||||||
Other, Net
|
—
|
(35
|
)
|
—
|
17
|
—
|
(18
|
)
|
||||||||||||||||
Income (Loss) Before Income Taxes
|
123
|
144
|
259
|
368
|
(654
|
)
|
240
|
|||||||||||||||||
Provision for Income Taxes
|
—
|
—
|
(2
|
)
|
(108
|
)
|
—
|
(110
|
)
|
|||||||||||||||
Net Income (Loss)
|
123
|
144
|
257
|
260
|
(654
|
)
|
130
|
|||||||||||||||||
Noncontrolling Interests
|
—
|
—
|
—
|
(7
|
)
|
—
|
(7
|
)
|
||||||||||||||||
Net Income (Loss) Attributable to Weatherford
|
$
|
123
|
$
|
144
|
$
|
257
|
$
|
253
|
$
|
(654
|
)
|
$
|
123
|
|||||||||||
Comprehensive Income Attributable to Weatherford
|
$
|
123
|
$
|
144
|
$
|
257
|
$
|
435
|
$
|
(654
|
)
|
$
|
305
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Cash Flows from Operating Activities:
|
||||||||||||||||||||||||
Net Income (Loss)
|
$ |
22
|
$ |
80
|
$ |
125
|
$ |
146
|
$ |
(343
|
)
|
$ |
30
|
|||||||||||
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided (Used) by Operating Activities:
|
||||||||||||||||||||||||
Charges from Parent or Subsidiary
|
—
|
—
|
(30
|
)
|
30
|
—
|
—
|
|||||||||||||||||
Equity in (Earnings) Loss of Affiliates
|
(31
|
)
|
(195
|
)
|
(117
|
)
|
—
|
343
|
—
|
|||||||||||||||
Deferred Income Tax Provision (Benefit)
|
—
|
—
|
6
|
(9
|
)
|
—
|
(3
|
) | ||||||||||||||||
Other Adjustments
|
129
|
246
|
(125
|
)
|
(288
|
)
|
—
|
(38
|
)
|
|||||||||||||||
Net Cash Provided (Used) by Operating Activities
|
120
|
131
|
(141
|
)
|
(121
|
)
|
—
|
(11
|
)
|
|||||||||||||||
|
||||||||||||||||||||||||
Cash Flows from Investing Activities:
|
||||||||||||||||||||||||
Capital Expenditures for Property, Plant and Equipment
|
—
|
—
|
—
|
(400
|
)
|
—
|
(400
|
)
|
||||||||||||||||
Acquisitions of Businesses, Net of Cash Acquired
|
—
|
—
|
—
|
(4
|
)
|
—
|
(4
|
)
|
||||||||||||||||
Acquisition of Intellectual Property
|
—
|
—
|
—
|
(1
|
)
|
—
|
(1
|
)
|
||||||||||||||||
Proceeds from Sale of Assets and Businesses, Net
|
—
|
—
|
—
|
85
|
—
|
85
|
||||||||||||||||||
Capital Contribution to Subsidiary
|
(129
|
)
|
—
|
—
|
—
|
129
|
—
|
|||||||||||||||||
Net Cash Provided (Used) by Investing Activities
|
(129
|
)
|
—
|
—
|
(320
|
)
|
129
|
(320
|
)
|
|||||||||||||||
|
||||||||||||||||||||||||
Cash Flows from Financing Activities:
|
||||||||||||||||||||||||
Borrowings (Repayments) Short-term Debt, Net
|
—
|
648
|
—
|
(23
|
)
|
—
|
625
|
|||||||||||||||||
Borrowings (Repayments) Long-term Debt, Net
|
—
|
(294
|
)
|
(9
|
)
|
(1
|
)
|
—
|
(304
|
)
|
||||||||||||||
Borrowings (Repayments) Between Subsidiaries, Net
|
9
|
(484
|
)
|
150
|
325
|
—
|
—
|
|||||||||||||||||
Proceeds from Capital Contribution
|
—
|
—
|
—
|
129
|
(129
|
)
|
—
|
|||||||||||||||||
Other, Net
|
—
|
—
|
—
|
(3
|
)
|
—
|
(3
|
)
|
||||||||||||||||
Net Cash Provided (Used) by Financing Activities
|
9
|
(130
|
)
|
141
|
427
|
(129
|
)
|
318
|
||||||||||||||||
|
||||||||||||||||||||||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents
|
—
|
—
|
—
|
(1
|
)
|
—
|
(1
|
)
|
||||||||||||||||
|
||||||||||||||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents
|
—
|
1
|
—
|
(15
|
)
|
—
|
(14
|
)
|
||||||||||||||||
Cash and Cash Equivalents at Beginning of Period
|
—
|
—
|
—
|
300
|
—
|
300
|
||||||||||||||||||
Cash and Cash Equivalents at End of Period
|
$
|
—
|
$
|
1
|
$
|
—
|
$
|
285
|
$
|
—
|
$
|
286
|
|
Weatherford
Switzerland
|
Weatherford
Bermuda
|
Weatherford
Delaware
|
Other
Subsidiaries
|
Eliminations
|
Consolidation
|
||||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
||||||||||||||||||
Net Income (Loss)
|
$
|
123
|
$
|
144
|
$
|
257
|
$
|
260
|
$
|
(654
|
)
|
$
|
130
|
|||||||||||
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided (Used) by
Operating Activities:
|
||||||||||||||||||||||||
Charges from Parent or Subsidiary
|
—
|
(8
|
)
|
(25
|
)
|
33
|
—
|
—
|
||||||||||||||||
Equity in (Earnings) Loss of Affiliates
|
(139
|
)
|
(261
|
)
|
(254
|
)
|
—
|
654
|
—
|
|||||||||||||||
Deferred Income Tax Provision (Benefit)
|
—
|
—
|
(19
|
)
|
38
|
—
|
19
|
|||||||||||||||||
Other Adjustments
|
9
|
(136
|
)
|
(155
|
)
|
273
|
—
|
(9
|
)
|
|||||||||||||||
Net Cash Provided (Used) by
Operating Activities
|
(7
|
)
|
(261
|
)
|
(196
|
)
|
604
|
—
|
140
|
|||||||||||||||
|
||||||||||||||||||||||||
Cash Flows from Investing Activities:
|
||||||||||||||||||||||||
Capital Expenditures for Property,
Plant and Equipment
|
—
|
—
|
—
|
(514
|
)
|
—
|
(514
|
)
|
||||||||||||||||
Acquisitions of Businesses,
Net of Cash Acquired
|
—
|
—
|
—
|
(12
|
)
|
—
|
(12
|
)
|
||||||||||||||||
Acquisition of Intellectual Property
|
—
|
—
|
—
|
(3
|
)
|
—
|
(3
|
)
|
||||||||||||||||
Proceeds from Sale of Assets and
Businesses, Net
|
—
|
—
|
—
|
5
|
—
|
5
|
||||||||||||||||||
Capital Contribution to Subsidiary
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||
Net Cash Used by
Investing Activities
|
—
|
—
|
—
|
(524
|
)
|
—
|
(524
|
)
|
||||||||||||||||
|
||||||||||||||||||||||||
Cash Flows from Financing Activities:
|
||||||||||||||||||||||||
Borrowings (Repayments) Short-term
Debt, Net
|
—
|
288
|
—
|
(3
|
)
|
—
|
285
|
|||||||||||||||||
Borrowings (Repayments) Long-term
Debt, Net
|
—
|
—
|
(6
|
)
|
7
|
—
|
1
|
|||||||||||||||||
Borrowings (Repayments) Between
Subsidiaries, Net
|
8
|
(27
|
)
|
205
|
(186
|
)
|
—
|
—
|
||||||||||||||||
Proceeds from Capital Contribution
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||
Other, Net
|
—
|
—
|
—
|
63
|
—
|
63
|
||||||||||||||||||
Net Cash Provided (Used) by Financing
Activities
|
8
|
261
|
199
|
(119
|
)
|
—
|
349
|
|||||||||||||||||
|
||||||||||||||||||||||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents
|
—
|
—
|
—
|
3
|
—
|
3
|
||||||||||||||||||
|
||||||||||||||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents
|
1
|
—
|
3
|
(36
|
)
|
—
|
(32
|
)
|
||||||||||||||||
Cash and Cash Equivalents at Beginning of Period
|
—
|
—
|
—
|
371
|
—
|
371
|
||||||||||||||||||
Cash and Cash Equivalents at End of Period
|
$
|
1
|
$
|
—
|
$
|
3
|
$
|
335
|
$
|
—
|
$
|
339
|
-
|
Formation Evaluation and Well Construction includes: Drilling Services, Well Construction, Integrated Drilling, Wireline and Evaluation Services, Drilling Tools and Re-entry and Fishing
|
-
|
Completion and Production includes: Artificial Lift Systems, Stimulation and Chemicals, Completion Systems and Pipeline and Specialty Services
|
|
WTI Oil (a)
|
Henry Hub Gas (b)
|
North American Rig Count (c)
|
International Rig Count (c)
|
||||||||||||
|
|
|
|
|
||||||||||||
March 31, 2013
|
$
|
97.23
|
$
|
4.02
|
2,289
|
1,287
|
||||||||||
December 31, 2012
|
91.82
|
3.35
|
2,178
|
1,260
|
||||||||||||
March 31, 2012
|
103.02
|
2.13
|
2,574
|
1,189
|
(a)
|
Price per barrel of West Texas Intermediate ("WTI") crude oil of the date indicated at Cushing Oklahoma –
Source:
Thomson Reuters
|
(b)
|
Price per MM/BTU as of the date indicated at Henry Hub Louisiana –
Source:
Thomson Reuters
|
(c)
|
Average rig count for the period indicated –
Source:
Baker Hughes Rig Count
|
|
Three Months
Ended March 31,
|
|||||||
|
2013
|
2012
|
||||||
(In millions, except per share amounts)
|
||||||||
Revenues:
|
|
|||||||
North America
|
$
|
1,692
|
$
|
1,754
|
||||
MENA/Asia Pacific
|
785
|
595
|
||||||
Europe/SSA/Russia
|
633
|
571
|
||||||
Latin America
|
727
|
671
|
||||||
|
3,837
|
3,591
|
||||||
|
||||||||
Operating Income:
|
||||||||
North America
|
224
|
358
|
||||||
MENA/Asia Pacific
|
42
|
22
|
||||||
Europe/SSA/Russia
|
65
|
66
|
||||||
Latin America
|
98
|
83
|
||||||
Research and Development
|
(67
|
)
|
(62
|
)
|
||||
Corporate Expenses
|
(48
|
)
|
(50
|
)
|
||||
Other Items
|
(35
|
)
|
(47
|
)
|
||||
|
279
|
370
|
||||||
|
||||||||
Interest Expense, Net
|
(131
|
)
|
(112
|
)
|
||||
Devaluation of Venezuelan Bolivar
|
(100
|
)
|
—
|
|||||
Other, Net
|
(13
|
)
|
(18
|
)
|
||||
|
||||||||
|
||||||||
Net Income per Diluted Share
|
$
|
0.03
|
$
|
0.16
|
||||
|
||||||||
Depreciation and Amortization
|
346
|
299
|
|
Three Months
Ended March 31,
|
|||||||
2013
|
2012
|
|||||||
|
|
|
||||||
Formation Evaluation and Well Construction
|
59
|
%
|
57
|
%
|
||||
Completion and Production
|
41
|
%
|
43
|
%
|
||||
|
100
|
%
|
100
|
%
|
Facilities
|
$
|
2,250
|
||
|
||||
Less:
|
||||
Amount drawn
|
643
|
|||
Commercial paper
|
893
|
|||
Letters of credit
|
118
|
|||
Availability
|
$
|
596
|
|
March 31, 2013
|
December 31, 2012
|
||||||||||||||
|
Carrying
Amount
|
Fair
Value
|
Carrying Amount
|
Fair
Value
|
||||||||||||
|
(In millions)
|
|||||||||||||||
|
|
|
|
|
||||||||||||
5.15% Senior Notes due 2013
|
$
|
—
|
$
|
—
|
$
|
294
|
$
|
296
|
||||||||
4.95% Senior Notes due 2013
|
250
|
255
|
250
|
258
|
||||||||||||
5.50% Senior Notes due 2016
|
354
|
382
|
354
|
380
|
||||||||||||
6.35% Senior Notes due 2017
|
612
|
695
|
613
|
690
|
||||||||||||
6.00% Senior Notes due 2018
|
497
|
579
|
497
|
570
|
||||||||||||
9.625% Senior Notes due 2019
|
1,024
|
1,301
|
1,025
|
1,307
|
||||||||||||
5.125% Senior Notes due 2020
|
797
|
865
|
797
|
875
|
||||||||||||
4.50% Senior Notes due 2022
|
747
|
768
|
747
|
794
|
||||||||||||
6.50% Senior Notes due 2036
|
595
|
644
|
595
|
645
|
||||||||||||
6.80% Senior Notes due 2037
|
298
|
334
|
298
|
339
|
||||||||||||
7.00% Senior Notes due 2038
|
497
|
556
|
497
|
564
|
||||||||||||
9.875% Senior Notes due 2039
|
247
|
357
|
247
|
370
|
||||||||||||
6.75% Senior Notes due 2040
|
596
|
669
|
596
|
680
|
||||||||||||
5.95% Senior Notes due 2042
|
545
|
568
|
545
|
600
|
·
|
Engaged third-party tax advisors and consultants to assist with enhancing internal controls over financial reporting for income taxes and developing and implementing a remediation plan;
|
·
|
Revised the process for the quarterly and annual tax provisions including additional resources focused on the review and oversight of the tax accounts, reserves for unrecognized tax benefits and preparation of the income tax provision;
|
·
|
Began recruitment of various positions within the tax and financial reporting departments and completed the hiring of several newly created positions;
|
·
|
Completed the review and validation of the current and deferred tax balance sheet accounts at significant locations; and
|
·
|
Provided income tax accounting training to tax and financial personnel within each region.
|
·
|
On-going evaluation and continued enhancement of tax department personnel and organizational structure including the continued use of third-party tax advisors and consultants to both assist with enhancing internal controls over financial reporting and to augment our existing tax staff until new appropriately qualified employees are hired and trained. From July 1, 2012 through March 31, 2013, we have hired approximately 35 qualified tax professionals;
|
·
|
On-going evaluation of our tax accounting processes and controls to ensure that they are appropriate for our organization and to make enhancements when appropriate to improve effectiveness;
|
·
|
Timely preparation of tax basis balance sheets and reconciliations of the tax accounts to enable more timely detection of potential errors;
|
·
|
On-going analysis of uncertain tax positions in all jurisdictions, leveraging the extensive work performed by the Company in connection with the December 17, 2012 restatement into a routine process for identifying and assessing uncertain tax positions on a timely basis;
|
·
|
Continued evaluation of the information technology infrastructure supporting our income tax process and implementation of additional technology solutions to further eliminate manual processes and provide long-term sustainability of the process improvements; and
|
·
|
Continued delivery of income tax accounting training for tax and financial accounting personnel.
|
Period
|
No. of Shares
|
Average Price
|
||||||
|
|
|
||||||
January 1 – January 31, 2013
|
169,565
|
$
|
11.33
|
|||||
February 1 – February 28, 2013
|
118,315
|
13.46
|
||||||
March 1 – March 31, 2013
|
51,283
|
11.53
|
Exhibit
Number
|
Description
|
|
|
*4.1
|
Seventh Supplemental Indenture dated as of March 31, 2013, among Weatherford International Ltd., Weatherford International, Inc., Weatherford International Ltd., and Deutsche Bank Trust Company Americas, to the indenture dated as of October 1, 2003.
|
*4.2
|
Fourth Supplemental Indenture dated as of March 31, 2013, among Weatherford International, Inc., Weatherford International Ltd., Weatherford International Ltd., and Deutsche Bank Trust Company Americas to the indenture dated as of June 18, 2007.
|
*31.1
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
*31.2
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
**32.1
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
**32.2
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
**101
|
The following materials from Weatherford International Ltd.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, formatted in XBRL (Extensible Business Reporting Language): (1) the unaudited Condensed Consolidated Balance Sheets, (2) the unaudited Condensed Consolidated Statements of Operations, (3) the unaudited Condensed Consolidated Statements of Cash Flows, (4) the unaudited Condensed Consolidated Statements of Comprehensive Income and (5) related notes to the unaudited Condensed Consolidated Financial Statements.
|
(1)
|
The Report fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
(1)
|
The Report fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|