Weatherford posts record revenues

by on July 25, 2012 9:05 am BST

The company posted a pre-tax profit $205 million for the second quarter of the year, up from $157 million a year earlier.

The rise in profit came despite the company revealing a $100 million charge which represented the company’s best estimate of a potential settlement with the US government related to its investigation of alleged improper sales in certain sanctioned countries.

However it noted that as the investigation was not yet settled the actual loss related to the matter could be “more or less”.

The company also booked severance, exit and other charges of $24 million, however this was offset by a $53 million gain on the sale of its subsea controls business.

Also helping soften the blow of the pre-tax charges were record high quarterly revenues totaling nearly $3.8 billion, compared to just under $3.1 billion during the second quarter of 2011.

Revenue was up 25% from the company’s operations in the North American region which contributed nearly $1.8 billion to the company’s coffers, compared to $1.3 billion a year ago.

Revenue was also up across all of the company’s other operating regions internationally which contributed a combined $2.1 billion.

Weatherford said it was reporting its results on a pre-tax basis because it was still working through the “material weakness” in its internal controls over tax reporting.

“Weatherford has committed its full resources to address our income tax accounting issues as quickly and as thoroughly as possible,” Weatherford chief executive Bernard J Duroc-Danner said. 

“Our entire senior management team and their respective functional departments—tax, accounting, legal and operations—are working together to achieve our goal, and we all are working with Ernst & Young, whose support and guidance is greatly appreciated.”

Weatherford said it continued to expect modest revenue and operating income growth compared to 2011, with earnings per share of $0.30 to $0.33 per share forecast for the third quarter of the year.