Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - SCHLUMBERGER LIMITED/NV | h78263e8vk.htm |
Exhibit 99.1
Schlumberger
Limited
Unaudited Pro Forma Historical
Consolidated Financial Information
Unaudited Pro Forma Historical
Consolidated Financial Information
Unaudited Pro Forma Historical Consolidated Financial Information
Schlumberger Limited (“Schlumberger” or the “Company”) currently reports its results on the
basis of two business segments, Oilfield Services and WesternGeco, and by geographical areas within
Oilfield Services. As a result of the recent acquisitions of Smith International, Inc. (“Smith”)
and Geoservices, Schlumberger has reached a point where its coverage of the various activities
comprising exploration and production services is so broad that the Company will be changing the
primary way in which it allocates resources and assesses performance. Consequently, as previously
announced and effective with the first quarter of 2011, Schlumberger will change its primary
reporting to product group segments (the “Groups”). Schlumberger believes that this change will
give investors a better perspective on the different parts of its business. The Company will also
continue to report its results on a geographical basis.
The Groups are as follows:
| • | Reservoir Characterization Group: This group will consist of the principal Technologies
involved in the finding and defining of hydrocarbon deposits. These include WesternGeco,
Wireline, Well Testing, Schlumberger Information Services, and Data & Consulting Services. |
||
| • | Drilling Group: This group will be comprised of Bits & Advanced Technologies, M-I SWACO,
Geoservices, Drilling & Measurements, PathFinder, Drilling Tools & Remedial Services,
Dynamic Pressure Management and IPM well construction projects. |
||
| • | Reservoir Production Group: Includes Well Services, Completions and Artificial Lift
Technologies together with Subsea and Water and Carbon Services activities, and the
production activities of IPM. |
The Groups will collectively be referred to as “Oilfield Services.” Additionally, Schlumberger will
also report the distribution business acquired in the Smith transaction, as a separate segment.
The above changes will be reflected in the consolidated financial statements and segment reporting
beginning in fiscal year 2011, starting with the Form 10-Q for the three months ended March 31,
2011. To provide additional perspective on these changes, Schlumberger has prepared the
accompanying unaudited pro forma historical consolidated financial information (“Pro Forma
Information”) on the basis of the new reporting structure, giving effect to the acquisitions of
Smith and Geoservices as if they had occurred on January 1, 2008.
The Pro Forma Information is based on the historical consolidated statements of income of
Schlumberger, Smith and Geoservices. The Pro Forma Information has been adjusted to reflect pro
forma events that are directly attributable to the transactions and factually supportable. As
such, the Pro Forma Information does not reflect any cost savings, operating synergies or revenue
enhancements that the combined companies may achieve as a result of the transactions, the costs to
integrate the operations of Schlumberger, Smith and Geoservices, or the costs necessary to achieve
these cost savings, operating synergies and revenue enhancements.
The Pro Forma Information has been presented for informational purposes only and is not necessarily
indicative of what the combined company’s results of operations would have been had the
transactions actually been completed as of January 1, 2008. In addition, the Pro Forma Information
does not purport to project the future operating results of the combined companies.
2008 UNAUDITED PRO FORMA HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(Stated in millions, except per share amounts)
(Stated in millions, except per share amounts)
| 2008 BY BUSINESS GROUP | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Year | ||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | |||||||||||||||||||||||||||||||||||||||||||
| Income | Income | Income | Income | Income | ||||||||||||||||||||||||||||||||||||||||||||||||
Oilfield Services |
||||||||||||||||||||||||||||||||||||||||||||||||||||
Resevoir Characterization |
$ | 2,684 | $ | 866 | $ | 2,823 | $ | 926 | $ | 3,106 | $ | 1,086 | $ | 2,832 | $ | 819 | $ | 11,445 | $ | 3,697 | ||||||||||||||||||||||||||||||||
Resevoir Production |
2,136 | 412 | 2,299 | 454 | 2,506 | 491 | 2,571 | 468 | 9,512 | 1,825 | ||||||||||||||||||||||||||||||||||||||||||
Drilling |
3,314 | 764 | 3,552 | 889 | 3,797 | 872 | 3,788 | 768 | 14,451 | 3,293 | ||||||||||||||||||||||||||||||||||||||||||
Eliminations & Other |
13 | (23 | ) | 6 | (18 | ) | 6 | (29 | ) | 23 | - | 48 | (70 | ) | ||||||||||||||||||||||||||||||||||||||
| 8,147 | 2,019 | 8,680 | 2,251 | 9,415 | 2,420 | 9,214 | 2,055 | 35,456 | 8,745 | |||||||||||||||||||||||||||||||||||||||||||
Distribution |
568 | 30 | 616 | 37 | 761 | 62 | 794 | 52 | 2,739 | 181 | ||||||||||||||||||||||||||||||||||||||||||
| $ | 8,715 | 2,049 | $ | 9,296 | 2,288 | $ | 10,176 | 2,482 | $ | 10,008 | 2,107 | $ | 38,195 | 8,926 | ||||||||||||||||||||||||||||||||||||||
Corporate (1) |
(131 | ) | (119 | ) | (133 | ) | (120 | ) | (503 | ) | ||||||||||||||||||||||||||||||||||||||||||
Interest Income |
37 | 22 | 28 | 25 | 112 | |||||||||||||||||||||||||||||||||||||||||||||||
Interest Expense (2) |
(67 | ) | (64 | ) | (70 | ) | (77 | ) | (278 | ) | ||||||||||||||||||||||||||||||||||||||||||
Charges & Credits (5) |
- | - | - | (145 | ) | (145 | ) | |||||||||||||||||||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
1,888 | 2,127 | 2,307 | 1,790 | 8,112 | |||||||||||||||||||||||||||||||||||||||||||||||
Tax Expense |
(429 | ) | (508 | ) | (561 | ) | (457 | ) | (1,955 | ) | ||||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
1,459 | 1,619 | 1,746 | 1,333 | 6,157 | |||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests |
(14 | ) | (10 | ) | (20 | ) | (7 | ) | (51 | ) | ||||||||||||||||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 1,445 | $ | 1,609 | $ | 1,726 | $ | 1,326 | $ | 6,106 | ||||||||||||||||||||||||||||||||||||||||||
| 2008 BY GEOGRAPHIC AREA | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Year | |||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | ||||||||||||||||||||||||||||||||||||||||||||
| Income | Income | Income | Income | Income | |||||||||||||||||||||||||||||||||||||||||||||||||
Oilfield Services |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
North America |
$ | 2,306 | $ | 593 | $ | 2,294 | $ | 553 | $ | 2,665 | $ | 634 | $ | 2,818 | $ | 636 | $ | 10,083 | $ | 2,416 | |||||||||||||||||||||||||||||||||
Latin America |
1,197 | 222 | 1,349 | 271 | 1,446 | 267 | 1,449 | 239 | 5,441 | 999 | |||||||||||||||||||||||||||||||||||||||||||
Europe/CIS/W.Africa |
2,709 | 679 | 2,998 | 808 | 3,271 | 955 | 2,877 | 629 | 11,855 | 3,071 | |||||||||||||||||||||||||||||||||||||||||||
Middle East & Asia |
1,924 | 562 | 2,032 | 638 | 2,013 | 603 | 2,045 | 558 | 8,014 | 2,361 | |||||||||||||||||||||||||||||||||||||||||||
Eliminations & Other |
11 | (37 | ) | 7 | (19 | ) | 20 | (39 | ) | 25 | (7 | ) | 63 | (102 | ) | ||||||||||||||||||||||||||||||||||||||
| 8,147 | 2,019 | 8,680 | 2,251 | 9,415 | 2,420 | 9,214 | 2,055 | 35,456 | 8,745 | ||||||||||||||||||||||||||||||||||||||||||||
Distribution |
568 | 30 | 616 | 37 | 761 | 62 | 794 | 52 | 2,739 | 181 | |||||||||||||||||||||||||||||||||||||||||||
| $ | 8,715 | 2,049 | $ | 9,296 | 2,288 | $ | 10,176 | 2,482 | $ | 10,008 | 2,107 | $ | 38,195 | 8,926 | |||||||||||||||||||||||||||||||||||||||
Corporate (1) |
(131 | ) | (119 | ) | (133 | ) | (120 | ) | (503 | ) | |||||||||||||||||||||||||||||||||||||||||||
Interest Income |
37 | 22 | 28 | 25 | 112 | ||||||||||||||||||||||||||||||||||||||||||||||||
Interest Expense (2) |
(67 | ) | (64 | ) | (70 | ) | (77 | ) | (278 | ) | |||||||||||||||||||||||||||||||||||||||||||
Charges & Credits (5) |
- | - | - | (145 | ) | (145 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
1,888 | 2,127 | 2,307 | 1,790 | 8,112 | ||||||||||||||||||||||||||||||||||||||||||||||||
Tax Expense |
(429 | ) | (508 | ) | (561 | ) | (457 | ) | (1,955 | ) | |||||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
1,459 | 1,619 | 1,746 | 1,333 | 6,157 | ||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests |
(14 | ) | (10 | ) | (20 | ) | (7 | ) | (51 | ) | |||||||||||||||||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 1,445 | $ | 1,609 | $ | 1,726 | $ | 1,326 | $ | 6,106 | |||||||||||||||||||||||||||||||||||||||||||
Average Diluted Shares Outstanding (3) |
1,408 | 1,405 | 1,400 | 1,385 | 1,399 | ||||||||||||||||||||||||||||||||||||||||||||||||
Diluted Earnings per Share - excluding Charges & Credits (4) |
$ | 1.03 | $ | 1.15 | $ | 1.23 | $ | 1.04 | $ | 4.46 | |||||||||||||||||||||||||||||||||||||||||||
Diluted Earnings per Share - including Charges & Credits (4) |
$ | 1.03 | $ | 1.15 | $ | 1.23 | $ | 0.96 | $ | 4.37 | |||||||||||||||||||||||||||||||||||||||||||
Effective Tax Rate - excluding Charges & Credits |
22.7% | 23.9% | 24.3% | 25.0% | 24.0% | ||||||||||||||||||||||||||||||||||||||||||||||||
Effective Tax Rate - including Charges & Credits |
22.7% | 23.9% | 24.3% | 25.5% | 24.1% | ||||||||||||||||||||||||||||||||||||||||||||||||
2009 UNAUDITED PRO FORMA HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(Stated in millions, except per share amounts)
(Stated in millions, except per share amounts)
| 2009 BY BUSINESS GROUP | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Year | |||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | ||||||||||||||||||||||||||||||||||||||||||||
| Income | Income | Income | Income | Income | |||||||||||||||||||||||||||||||||||||||||||||||||
Oilfield Services |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
Resevoir Characterization |
$ | 2,487 | $ | 644 | $ | 2,396 | $ | 633 | $ | 2,294 | $ | 565 | $ | 2,521 | $ | 701 | $ | 9,698 | $ | 2,543 | |||||||||||||||||||||||||||||||||
Resevoir Production |
2,040 | 262 | 1,775 | 191 | 1,762 | 195 | 1,852 | 151 | 7,429 | 799 | |||||||||||||||||||||||||||||||||||||||||||
Drilling |
3,368 | 667 | 2,951 | 488 | 2,921 | 481 | 2,999 | 450 | 12,239 | 2,086 | |||||||||||||||||||||||||||||||||||||||||||
Eliminations & Other |
9 | (9 | ) | 6 | (24 | ) | 16 | - | 15 | (23 | ) | 46 | (56 | ) | |||||||||||||||||||||||||||||||||||||||
| 7,904 | 1,564 | 7,128 | 1,288 | 6,993 | 1,241 | 7,387 | 1,279 | 29,412 | 5,372 | ||||||||||||||||||||||||||||||||||||||||||||
Distribution |
570 | 16 | 411 | (9 | ) | 379 | (20 | ) | 410 | (19 | ) | 1,770 | (32 | ) | |||||||||||||||||||||||||||||||||||||||
| $ | 8,474 | 1,580 | $ | 7,539 | 1,279 | $ | 7,372 | 1,221 | $ | 7,797 | 1,260 | $ | 31,182 | 5,340 | |||||||||||||||||||||||||||||||||||||||
Corporate (1) |
(156 | ) | (149 | ) | (161 | ) | (161 | ) | (627 | ) | |||||||||||||||||||||||||||||||||||||||||||
Interest Income |
14 | 13 | 13 | 12 | 52 | ||||||||||||||||||||||||||||||||||||||||||||||||
Interest Expense (2) |
(62 | ) | (77 | ) | (74 | ) | (72 | ) | (285 | ) | |||||||||||||||||||||||||||||||||||||||||||
Charges & Credits (5) |
(33 | ) | (251 | ) | (13 | ) | - | (297 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
1,343 | 815 | 986 | 1,039 | 4,183 | ||||||||||||||||||||||||||||||||||||||||||||||||
Tax Expense |
(330 | ) | (174 | ) | (209 | ) | (199 | ) | (912 | ) | |||||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
1,013 | 641 | 777 | 840 | 3,271 | ||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests |
(9 | ) | (8 | ) | (5 | ) | (5 | ) | (27 | ) | |||||||||||||||||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 1,004 | $ | 633 | $ | 772 | $ | 835 | $ | 3,244 | |||||||||||||||||||||||||||||||||||||||||||
| 2009 BY GEOGRAPHIC AREA | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Year | |||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | Revenue | Pretax | ||||||||||||||||||||||||||||||||||||||||||||
| Income | Income | Income | Income | Income | |||||||||||||||||||||||||||||||||||||||||||||||||
Oilfield Services |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
North America |
$ | 2,023 | $ | 261 | $ | 1,461 | $ | 72 | $ | 1,412 | $ | 72 | $ | 1,603 | $ | 141 | $ | 6,499 | $ | 546 | |||||||||||||||||||||||||||||||||
Latin America |
1,403 | 283 | 1,323 | 232 | 1,400 | 245 | 1,479 | 198 | 5,605 | 958 | |||||||||||||||||||||||||||||||||||||||||||
Europe/CIS/W.Africa |
2,528 | 543 | 2,500 | 530 | 2,480 | 525 | 2,482 | 502 | 9,990 | 2,100 | |||||||||||||||||||||||||||||||||||||||||||
Middle East & Asia |
1,944 | 538 | 1,834 | 506 | 1,686 | 427 | 1,788 | 469 | 7,252 | 1,940 | |||||||||||||||||||||||||||||||||||||||||||
Eliminations & Other |
6 | (61 | ) | 10 | (52 | ) | 15 | (28 | ) | 35 | (31 | ) | 66 | (172 | ) | ||||||||||||||||||||||||||||||||||||||
| 7,904 | 1,564 | 7,128 | 1,288 | 6,993 | 1,241 | 7,387 | 1,279 | 29,412 | 5,372 | ||||||||||||||||||||||||||||||||||||||||||||
Distribution |
570 | 16 | 411 | (9 | ) | 379 | (20 | ) | 410 | (19 | ) | 1,770 | (32 | ) | |||||||||||||||||||||||||||||||||||||||
| $ | 8,474 | 1,580 | $ | 7,539 | 1,279 | $ | 7,372 | 1,221 | $ | 7,797 | 1,260 | $ | 31,182 | 5,340 | |||||||||||||||||||||||||||||||||||||||
Corporate (1) |
(156 | ) | (149 | ) | (161 | ) | (161 | ) | (627 | ) | |||||||||||||||||||||||||||||||||||||||||||
Interest Income |
14 | 13 | 13 | 12 | 52 | ||||||||||||||||||||||||||||||||||||||||||||||||
Interest Expense (2) |
(62 | ) | (77 | ) | (74 | ) | (72 | ) | (285 | ) | |||||||||||||||||||||||||||||||||||||||||||
Charges & Credits (5) |
(33 | ) | (251 | ) | (13 | ) | - | (297 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
1,343 | 815 | 986 | 1,039 | 4,183 | ||||||||||||||||||||||||||||||||||||||||||||||||
Tax Expense |
(330 | ) | (174 | ) | (209 | ) | (199 | ) | (912 | ) | |||||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
1,013 | 641 | 777 | 840 | 3,271 | ||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests |
(9 | ) | (8 | ) | (5 | ) | (5 | ) | (27 | ) | |||||||||||||||||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 1,004 | $ | 633 | $ | 772 | $ | 835 | $ | 3,244 | |||||||||||||||||||||||||||||||||||||||||||
Average Diluted Shares Outstanding (3) |
1,385 | 1,389 | 1,393 | 1,393 | 1,390 | ||||||||||||||||||||||||||||||||||||||||||||||||
Diluted Earnings per Share - excluding Charges & Credits (4) |
$ | 0.74 | $ | 0.61 | $ | 0.56 | $ | 0.60 | $ | 2.52 | |||||||||||||||||||||||||||||||||||||||||||
Diluted
Earnings per Share - including Charges & Credits
(4) |
$ | 0.73 | $ | 0.46 | $ | 0.56 | $ | 0.60 | $ | 2.34 | |||||||||||||||||||||||||||||||||||||||||||
Effective Tax Rate - excluding Charges & Credits |
24.6% | 19.6% | 21.3% | 19.2% | 21.4% | ||||||||||||||||||||||||||||||||||||||||||||||||
Effective Tax Rate - including Charges & Credits |
24.6% | 21.3% | 21.2% | 19.2% | 21.8% | ||||||||||||||||||||||||||||||||||||||||||||||||
2010 UNAUDITED PRO FORMA HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(Stated in millions, except per share amounts)
2
0 1 0 B Y B U S I N E S S G R O U P
| Q1 | Q2 | Q3 | Nine Months | ||||||||||||||||||||||||||||||||
| Revenue | Pretax Income |
Revenue | Pretax Income |
Revenue | Pretax Income |
Revenue | Pretax Income |
||||||||||||||||||||||||||||
Oilfield Services |
|||||||||||||||||||||||||||||||||||
Resevoir Characterization |
$ | 2,301 | $ | 561 | $ | 2,358 | $ | 553 | $ | 2,338 | $ | 525 | $ | 6,997 | $ | 1,639 | |||||||||||||||||||
Resevoir Production |
1,920 | 164 | 2,136 | 260 | 2,312 | 384 | 6,368 | 808 | |||||||||||||||||||||||||||
Drilling |
3,114 | 466 | 3,260 | 510 | 3,131 | 432 | 9,505 | 1,408 | |||||||||||||||||||||||||||
Eliminations & Other |
11 | 15 | 16 | 5 | 14 | (12 | ) | 41 | 8 | ||||||||||||||||||||||||||
| 7,346 | 1,206 | 7,770 | 1,328 | 7,795 | 1,329 | 22,911 | 3,863 | ||||||||||||||||||||||||||||
Distribution |
452 | 5 | 490 | 14 | 548 | 20 | 1,490 | 39 | |||||||||||||||||||||||||||
| $ | 7,798 | 1,211 | $ | 8,260 | 1,342 | $ | 8,343 | 1,349 | $ | 24,401 | 3,902 | ||||||||||||||||||||||||
Corporate (1) |
(161 | ) | (168 | ) | (140 | ) | (469 | ) | |||||||||||||||||||||||||||
Interest Income |
13 | 11 | 10 | 34 | |||||||||||||||||||||||||||||||
Interest Expense (2) |
(66 | ) | (69 | ) | (68 | ) | (203 | ) | |||||||||||||||||||||||||||
Charges & Credits (5) |
(75 | ) | (15 | ) | 823 | 733 | |||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
922 | 1,101 | 1,974 | 3,997 | |||||||||||||||||||||||||||||||
Tax Expense |
(261 | ) | (229 | ) | (236 | ) | (726 | ) | |||||||||||||||||||||||||||
Income from Continuing Operations |
661 | 872 | 1,738 | 3,271 | |||||||||||||||||||||||||||||||
Noncontrolling Interests |
(4 | ) | - | - | (4 | ) | |||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 657 | $ | 872 | $ | 1,738 | $ | 3,267 | |||||||||||||||||||||||||||
2
0 1 0 B Y G E O G R A P H I C A R E A
|
|||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Nine Months | ||||||||||||||||||||||||||||||||
| Revenue | Pretax Income |
Revenue | Pretax Income |
Revenue | Pretax Income |
Revenue | Pretax Income |
||||||||||||||||||||||||||||
Oilfield Services |
|||||||||||||||||||||||||||||||||||
North America |
$ | 1,854 | $ | 195 | $ | 1,971 | $ | 232 | $ | 2,091 | $ | 322 | $ | 5,916 | $ | 749 | |||||||||||||||||||
Latin America |
1,406 | 218 | 1,499 | 234 | 1,389 | 194 | 4,294 | 646 | |||||||||||||||||||||||||||
Europe/CIS/W.Africa |
2,266 | 368 | 2,404 | 393 | 2,434 | 409 | 7,104 | 1,170 | |||||||||||||||||||||||||||
Middle East & Asia |
1,792 | 462 | 1,855 | 489 | 1,823 | 451 | 5,470 | 1,402 | |||||||||||||||||||||||||||
Eliminations & Other |
28 | (37 | ) | 41 | (20 | ) | 58 | (47 | ) | 127 | (104 | ) | |||||||||||||||||||||||
| 7,346 | 1,206 | 7,770 | 1,328 | 7,795 | 1,329 | 22,911 | 3,863 | ||||||||||||||||||||||||||||
Distribution |
452 | 5 | 490 | 14 | 548 | 20 | 1,490 | 39 | |||||||||||||||||||||||||||
| $ | 7,798 | 1,211 | $ | 8,260 | 1,342 | $ | 8,343 | 1,349 | $ | 24,401 | 3,902 | ||||||||||||||||||||||||
Corporate (1) |
(161 | ) | (168 | ) | (140 | ) | (469 | ) | |||||||||||||||||||||||||||
Interest Income |
13 | 11 | 10 | 34 | |||||||||||||||||||||||||||||||
Interest Expense (2) |
(66 | ) | (69 | ) | (68 | ) | (203 | ) | |||||||||||||||||||||||||||
Charges & Credits (5) |
(75 | ) | (15 | ) | 823 | 733 | |||||||||||||||||||||||||||||
Income before Tax and Noncontrolling Interests |
922 | 1,101 | 1,974 | 3,997 | |||||||||||||||||||||||||||||||
Tax Expense |
(261 | ) | (229 | ) | (236 | ) | (726 | ) | |||||||||||||||||||||||||||
Income from Continuing Operations |
661 | 872 | 1,738 | 3,271 | |||||||||||||||||||||||||||||||
Noncontrolling Interests |
(4 | ) | - | - | (4 | ) | |||||||||||||||||||||||||||||
Schlumberger Income from Continuing Operations |
$ | 657 | $ | 872 | $ | 1,738 | $ | 3,267 | |||||||||||||||||||||||||||
Average Diluted Shares Outstanding (3) |
1,390 | 1,383 | 1,375 | 1,383 | |||||||||||||||||||||||||||||||
Diluted
Earnings per Share - excluding Charges & Credits (4) |
$ | 0.56 | $ | 0.64 | $ | 0.65 | $ | 1.84 | |||||||||||||||||||||||||||
Diluted
Earnings per Share - including Charges & Credits (4) |
$ | 0.47 | $ | 0.63 | $ | 1.26 | $ | 2.36 | |||||||||||||||||||||||||||
Effective
Tax Rate - excluding Charges & Credits |
22.0% | 21.1% | 22.5% | 21.8% | |||||||||||||||||||||||||||||||
Effective
Tax Rate - including Charges & Credits |
28.3% | 20.8% | 12.0% | 18.2% | |||||||||||||||||||||||||||||||
Notes to the Schlumberger Limited Unaudited Pro Forma Historical
Consolidated Financial Information
Consolidated Financial Information
| (1) | Includes depreciation and amortization expense associated with fair value adjustments
to Smith’s acquired assets of approximately $50 million per quarter. |
|
| (2) | Reflects a reduction in interest expense of approximately $15 million per quarter as a
result of fair value adjustments recorded in purchase accounting relating to Smith’s long-term
fixed rate debt. |
|
| (3) | Diluted shares outstanding was calculated by taking the Schlumberger historical diluted shares
outstanding and adding the approximately 176 million shares of Schlumberger common stock issued in
connection with the Smith transaction. |
|
| (4) | The calculation of diluted earnings per share reflects the adding back of interest expense
associated with Schlumberger’s outstanding convertible debentures to net income, as appropriate,
for each period presented. |
|
| (5) | The following is a summary of Charges & Credits recorded in each period as well as a
reconciliation of pro forma diluted earnings per share, excluding charges and credits to pro forma
diluted earnings per share including charges and credits: |
2008 Charges & Credits and Reconciliation of Pro Forma Diluted EPS
(Stated in millions, except per share amounts)
| Fourth Quarter 2008 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 1,790 | $ | (457 | ) | $ | (7 | ) | $ | 1,326 | $ | 0.96 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
74 | (9 | ) | - | 65 | 0.05 | ||||||||||||||
Provision for doubtful accounts |
32 | (8 | ) | - | 24 | 0.02 | ||||||||||||||
Other |
10 | - | - | 10 | 0.01 | |||||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Derivative contract related loss |
29 | (10 | ) | - | 19 | 0.01 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 1,935 | $ | (484 | ) | $ | (7 | ) | $ | 1,444 | $ | 1.04 | ||||||||
| Twelve Months 2008 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 8,112 | $ | (1,955 | ) | $ | (51 | ) | $ | 6,106 | $ | 4.37 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
74 | (9 | ) | - | 65 | 0.05 | ||||||||||||||
Provision for doubtful accounts |
32 | (8 | ) | - | 24 | 0.02 | ||||||||||||||
Other |
10 | - | - | 10 | 0.01 | |||||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Derivative contract related loss |
29 | (10 | ) | - | 19 | 0.01 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 8,257 | $ | (1,982 | ) | $ | (51 | ) | $ | 6,224 | $ | 4.46 | ||||||||
2009 Charges & Credits and Reconciliation of Pro Forma Diluted EPS
(Stated in millions, except per share amounts)
| First Quarter 2009 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 1,343 | $ | (330 | ) | $ | (9 | ) | $ | 1,004 | $ | 0.73 | ||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
33 | (9 | ) | - | 24 | 0.02 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 1,376 | $ | (339 | ) | $ | (9 | ) | $ | 1,028 | $ | 0.74 | ||||||||
| Second Quarter 2009 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 815 | $ | (174 | ) | $ | (8 | ) | $ | 633 | $ | 0.46 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
102 | (17 | ) | - | 85 | 0.06 | ||||||||||||||
Postretirement benefits curtailment |
136 | (14 | ) | - | 122 | 0.09 | ||||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
13 | (4 | ) | - | 9 | 0.01 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 1,066 | $ | (209 | ) | $ | (8 | ) | $ | 849 | $ | 0.61 | ||||||||
| Third Quarter 2009 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 986 | $ | (209 | ) | $ | (5 | ) | $ | 772 | $ | 0.56 | ||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
13 | (4 | ) | - | 9 | 0.01 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 999 | $ | (213 | ) | $ | (5 | ) | $ | 781 | $ | 0.56 | ||||||||
| Twelve Months 2009 | ||||||||||||||||||||
| Pretax | Tax | Noncont. Interest |
Net | Diluted EPS (*) |
||||||||||||||||
Income attributable to Schlumberger |
$ | 4,183 | $ | (912 | ) | $ | (27 | ) | $ | 3,244 | $ | 2.34 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
102 | (17 | ) | - | 85 | 0.06 | ||||||||||||||
Postretirement benefits curtailment |
136 | (14 | ) | - | 122 | 0.09 | ||||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Workforce reductions |
59 | (17 | ) | - | 42 | 0.03 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 4,480 | $ | (960 | ) | $ | (27 | ) | $ | 3,493 | $ | 2.52 | ||||||||
2010 Charges & Credits and Reconciliation of Pro Forma Diluted EPS
(Stated in millions, except per share amounts)
| First
Quarter 2010 |
||||||||||||||||||||
| Pretax | Tax | Noncont. | Net | Diluted | ||||||||||||||||
| Interest | EPS (*) | |||||||||||||||||||
Income attributable to Schlumberger |
$ | 922 | $ | (261 | ) | $ | (4 | ) | $ | 657 | $ | 0.47 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Medicare Part D subsidy, elimination of tax deduction |
- | 40 | - | 40 | 0.03 | |||||||||||||||
Merger-related transaction costs |
35 | - | - | 35 | 0.03 | |||||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Venezuela currency devaluation |
23 | 3 | - | 26 | 0.02 | |||||||||||||||
Merger-related transaction costs |
17 | (1 | ) | - | 16 | 0.01 | ||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 997 | $ | (219 | ) | $ | (4 | ) | $ | 774 | $ | 0.56 | ||||||||
| Second
Quarter 2010 |
||||||||||||||||||||
| Pretax | Tax | Noncont. | Net | Diluted | ||||||||||||||||
| Interest | EPS (*) | |||||||||||||||||||
Income attributable to Schlumberger |
$ | 1,101 | $ | (229 | ) | $ | - | $ | 872 | $ | 0.63 | |||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Venezuela currency devaluation |
12 | (3 | ) | - | 9 | 0.01 | ||||||||||||||
Merger-related transaction costs |
24 | (6 | ) | - | 18 | 0.01 | ||||||||||||||
Gain on investment in @balance |
(21 | ) | 3 | - | (18 | ) | (0.01 | ) | ||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 1,116 | $ | (235 | ) | $ | - | $ | 881 | $ | 0.64 | |||||||||
| Third Quarter 2010 |
||||||||||||||||||||
| Pretax | Tax | Noncont. | Net | Diluted | ||||||||||||||||
| Interest | EPS (*) | |||||||||||||||||||
Income attributable to Schlumberger |
$ | 1,974 | $ | (236 | ) | $ | - | $ | 1,738 | $ | 1.26 | |||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Severance and other |
90 | (13 | ) | - | 77 | 0.06 | ||||||||||||||
Impairment relating to WesternGeco’s first generation Q-Land acquisition system |
78 | (7 | ) | - | 71 | 0.05 | ||||||||||||||
Other WesternGeco-related charges |
63 | - | - | 63 | 0.05 | |||||||||||||||
Professional fees and other |
56 | (1 | ) | - | 55 | 0.04 | ||||||||||||||
Merger-related employee benefits |
41 | (6 | ) | - | 35 | 0.03 | ||||||||||||||
Mexico restructuring |
40 | (4 | ) | - | 36 | 0.03 | ||||||||||||||
Inventory fair value adjustments |
38 | (14 | ) | - | 24 | 0.02 | ||||||||||||||
Repurchase of bonds |
28 | (10 | ) | - | 18 | 0.01 | ||||||||||||||
Gain on investment in M-I SWACO |
(1,270 | ) | 32 | - | (1,238 | ) | (0.90 | ) | ||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Merger-related transaction costs |
13 | - | - | 13 | 0.01 | |||||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 1,151 | $ | (259 | ) | $ | - | $ | 892 | $ | 0.65 | |||||||||
2010 Charges & Credits and Reconciliation of Pro Forma Diluted EPS (cont.)
(Stated in millions, except per share amounts)
| Nine
Months 2010 |
||||||||||||||||||||
| Pretax | Tax | Noncont. | Net | Diluted | ||||||||||||||||
| Interest | EPS (*) | |||||||||||||||||||
Income attributable to Schlumberger |
$ | 3,997 | $ | (726 | ) | $ | (4 | ) | $ | 3,267 | $ | 2.36 | ||||||||
Add back Schlumberger Charges & Credits: |
||||||||||||||||||||
Medicare Part D subsidy, elimination of tax deduction |
- | 40 | - | 40 | 0.03 | |||||||||||||||
Severance and other |
125 | (13 | ) | - | 112 | 0.08 | ||||||||||||||
Impairment relating to WesternGeco’s first generation Q-Land acquisition system |
78 | (7 | ) | - | 71 | 0.05 | ||||||||||||||
Other WesternGeco-related charges |
63 | - | - | 63 | 0.05 | |||||||||||||||
Professional fees and other |
56 | (1 | ) | - | 55 | 0.04 | ||||||||||||||
Merger-related employee benefits |
41 | (6 | ) | - | 35 | 0.03 | ||||||||||||||
Mexico restructuring |
40 | (4 | ) | - | 36 | 0.03 | ||||||||||||||
Inventory fair value adjustments |
38 | (14 | ) | - | 24 | 0.02 | ||||||||||||||
Repurchase of bonds |
28 | (10 | ) | - | 18 | 0.01 | ||||||||||||||
Gain on investment in M-I SWACO |
(1,270 | ) | 32 | - | (1,238 | ) | (0.90 | ) | ||||||||||||
Add back Smith Charges & Credits: |
||||||||||||||||||||
Venezuela currency devaluation |
35 | - | - | 35 | 0.03 | |||||||||||||||
Merger-related transaction costs |
54 | (7 | ) | - | 47 | 0.03 | ||||||||||||||
Gain on investment in @balance |
(21 | ) | 3 | - | (18 | ) | (0.01 | ) | ||||||||||||
Income attributable to Schlumberger, excluding Charges & Credits |
$ | 3,264 | $ | (713 | ) | $ | (4 | ) | $ | 2,547 | $ | 1.84 | ||||||||
(*) May not add due to rounding
Diluted earnings per share excluding Charges & Credits and effective tax rate excluding Charges &
Credits are non-GAAP financial measures. Schlumberger management believes that the exclusion of
Charges & Credits from the foregoing financial measures enables it to evaluate more effectively,
Schlumberger’s operations period over period and to identify operating trends that could otherwise
be masked by the excluded items. The foregoing non-GAAP financial measures should be considered in
addition to, not as a substitute for, or superior to other measures of financial performance
prepared in accordance with GAAP.