Halliburton Announces Second Quarter 2022 Results
Halliburton Company (NYSE: HAL) reported a net income of $109 million, or $0.12 per diluted share, for Q2 2022, down from $263 million or $0.29 per diluted share in Q1 2022. Adjusted net income rose to $442 million, or $0.49 per diluted share, up from $314 million or $0.35 in Q1. Total revenue surged 18%, reaching $5.1 billion, with notable increases in Completion and Production revenue, which grew 24%. However, a pre-tax charge of $344 million due to exiting Russia impacted results. Halliburton's future looks promising, driven by strong performance in both North American and international markets.
- Total revenue increased by 18% to $5.1 billion in Q2 2022 compared to Q1 2022.
- Adjusted net income rose to $442 million, a 41% increase from Q1 2022.
- Completion and Production revenue grew by 24%, driven by increased activity in pressure pumping and artificial lift.
- Strong pricing gains led to significant margin expansion across all product service lines.
- Net income decreased from $263 million in Q1 2022 to $109 million in Q2 2022.
- Reported operating income fell from $511 million in Q1 2022 to $374 million in Q2 2022.
- A pre-tax charge of $344 million was recorded due to exiting the Russian market.
-
Reported net income of
per diluted share$0.12 -
Adjusted net income of
per diluted share, excluding impairments and other charges$0.49
“Our strong second quarter performance demonstrates that our strategy is working well, and Halliburton’s strategic priorities are driving value. Total company revenue grew
“I expect the international markets will experience multiple years of growth, and I am confident that Halliburton is positioned to benefit more from this multi-year upcycle than ever before. We have a leading technology portfolio, the right geographic presence, and new service line opportunities that align perfectly with our strategy to deliver profitable international growth.
“In North America, I expect Halliburton to uniquely maximize value in this strong, steadily growing, and all but sold-out market. Pricing gains across all product service lines supported significant sequential margin expansion in the second quarter.
“Halliburton’s competitive position is unique among our peers. We have the scale and technology to benefit meaningfully and differentially from the international market expansion, and we are the leader in the extremely busy North American market. I’m excited about the future of Halliburton and expect us to deliver profitable growth, margin expansion, strong free cash flow, and industry-leading returns in this upcycle,” concluded Miller.
Operating Segments
Completion and Production
Completion and Production revenue in the second quarter of 2022 was
Drilling and Evaluation
Drilling and Evaluation revenue in the second quarter of 2022 was
Geographic Regions
International
International revenue in the second quarter of 2022 was
Other Financial Items
-
Halliburton recorded a pre-tax charge of
in the second quarter of 2022 as a result of our decision to exit$344 million Russia due to sanctions. This charge was included in "Impairments and other charges" on the Company's condensed consolidated statement of operations for the three months endedJune 30, 2022 .
Selective Technology & Highlights
- Halliburton announced that it will co-develop next generation field development planning software with Aker BP, a Norwegian oil and gas exploration and production company. The collaboration delivers a new cloud application – Field Development Planning (FDP) – from Halliburton. It also expands the scope of the current Digital Well Program®, a DecisionSpace® 365 cloud application, built on an open architecture to provide integrated well planning and design to increase collaboration and connectivity across drilling activities.
- Halliburton introduced the new Hedron™ platform of fixed cutter polycrystalline diamond compact (PDC) drill bits. These drill bits combine the latest technology with an industry-leading customization process to deliver high-performance, application-specific designs for customers. The culmination of multiple technologies, Hedron drill bits are the toughest and smartest on the market.
About Halliburton
Founded in 1919, Halliburton is one of the world's largest providers of products and services to the energy industry. With more than 40,000 employees, representing 130 nationalities in more than 70 countries, the company helps its customers maximize value throughout the lifecycle of the reservoir – from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the asset. Visit the Company’s website at www.halliburton.com. Connect with Halliburton on Facebook, Twitter, LinkedIn, Instagram and YouTube.
Forward-looking Statements
The statements in this press release that are not historical statements, including statements regarding future financial performance, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: the impact of COVID-19 and any variants, the related economic repercussions and resulting negative impact on demand for oil and gas, operational challenges relating to COVID-19 and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees, performance of contracts and supply chain disruptions; the ability of the OPEC+ countries to agree on and comply with production quotas; the continuation or suspension of our stock repurchase program, the amount, the timing, and the trading prices of Halliburton common stock, and the availability and alternative uses of cash; changes in the demand for or price of oil and/or natural gas; potential catastrophic events related to our operations, and related indemnification and insurance matters; protection of intellectual property rights and against cyber-attacks; compliance with environmental laws; changes in government regulations and regulatory requirements, particularly those related to oil and natural gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; compliance with laws related to income taxes and assumptions regarding the generation of future taxable income; risks of international operations, including risks relating to unsettled political conditions, war, including the ongoing
|
|||||||||||
Condensed Consolidated Statements of Operations |
|||||||||||
(Millions of dollars and shares except per share data) |
|||||||||||
(Unaudited) |
|||||||||||
|
Three Months Ended |
||||||||||
|
|
|
|
||||||||
|
2022 |
|
2021 |
|
2022 |
||||||
Revenue: |
|
|
|
|
|
||||||
Completion and Production |
$ |
2,911 |
|
|
$ |
2,048 |
|
|
$ |
2,353 |
|
Drilling and Evaluation |
|
2,163 |
|
|
|
1,659 |
|
|
|
1,931 |
|
Total revenue |
$ |
5,074 |
|
|
$ |
3,707 |
|
|
$ |
4,284 |
|
Operating income: |
|
|
|
|
|
||||||
Completion and Production |
$ |
499 |
|
|
$ |
317 |
|
|
$ |
296 |
|
Drilling and Evaluation |
|
286 |
|
|
|
175 |
|
|
|
294 |
|
Corporate and other |
|
(67 |
) |
|
|
(58 |
) |
|
|
(57 |
) |
Impairments and other charges (a) |
|
(344 |
) |
|
|
— |
|
|
|
(22 |
) |
Total operating income |
|
374 |
|
|
|
434 |
|
|
|
511 |
|
Interest expense, net |
|
(101 |
) |
|
|
(120 |
) |
|
|
(107 |
) |
Loss on early extinguishment of debt (b) |
|
— |
|
|
|
— |
|
|
|
(42 |
) |
Other, net |
|
(42 |
) |
|
|
(19 |
) |
|
|
(30 |
) |
Income before income taxes |
|
231 |
|
|
|
295 |
|
|
|
332 |
|
Income tax provision (c) |
|
(114 |
) |
|
|
(65 |
) |
|
|
(68 |
) |
Net income |
$ |
117 |
|
|
$ |
230 |
|
|
$ |
264 |
|
Net income attributable to noncontrolling interest |
|
(8 |
) |
|
|
(3 |
) |
|
|
(1 |
) |
Net income attributable to company |
$ |
109 |
|
|
$ |
227 |
|
|
$ |
263 |
|
Basic and diluted net income per share |
$ |
0.12 |
|
|
$ |
0.26 |
|
|
$ |
0.29 |
|
Basic weighted average common shares outstanding |
|
904 |
|
|
|
890 |
|
|
|
899 |
|
Diluted weighted average common shares outstanding |
|
909 |
|
|
|
890 |
|
|
|
903 |
|
(a) |
See Footnote Table 1 for details of the impairments and other charges recorded during the three months ended |
(b) |
During the three months ended |
(c) |
The tax provision includes the tax effect on impairments and other charges during the three months ended |
See Footnote Table 1 for Reconciliation of As Reported Operating Income to Adjusted Operating Income. |
|
See Footnote Table 3 for Reconciliation of As Reported Net Income to Adjusted Net Income. |
|
|||||||
Condensed Consolidated Statements of Operations |
|||||||
(Millions of dollars and shares except per share data) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended |
||||||
|
|
||||||
|
2022 |
|
2021 |
||||
Revenue: |
|
|
|
||||
Completion and Production |
$ |
5,264 |
|
|
$ |
3,918 |
|
Drilling and Evaluation |
|
4,094 |
|
|
|
3,240 |
|
Total revenue |
$ |
9,358 |
|
|
$ |
7,158 |
|
Operating income: |
|
|
|
||||
Completion and Production |
$ |
795 |
|
|
$ |
569 |
|
Drilling and Evaluation |
|
580 |
|
|
|
346 |
|
Corporate and other |
|
(124 |
) |
|
|
(111 |
) |
Impairments and other charges (a) |
|
(366 |
) |
|
|
— |
|
Total operating income |
|
885 |
|
|
|
804 |
|
Interest expense, net |
|
(208 |
) |
|
|
(245 |
) |
Loss on early extinguishment of debt (b) |
|
(42 |
) |
|
|
— |
|
Other, net |
|
(72 |
) |
|
|
(41 |
) |
Income before income taxes |
|
563 |
|
|
|
518 |
|
Income tax provision (c) |
|
(182 |
) |
|
|
(117 |
) |
Net Income |
$ |
381 |
|
|
$ |
401 |
|
Net Income attributable to noncontrolling interest |
|
(9 |
) |
|
|
(4 |
) |
Net Income attributable to company |
$ |
372 |
|
|
$ |
397 |
|
Basic and diluted net income per share |
$ |
0.41 |
|
|
$ |
0.45 |
|
Basic weighted average common shares outstanding |
|
902 |
|
|
|
889 |
|
Diluted weighted average common shares outstanding |
|
906 |
|
|
|
889 |
|
(a) |
See Footnote Table 2 for details of the impairments and other charges recorded during the six months ended |
(b) |
During the six months ended |
(c) |
The tax provision includes the tax effect on impairments and other charges and the loss on early extinguishment of debt during the six months ended |
See Footnote Table 2 for Reconciliation of As Reported Operating Income to Adjusted Operating Income. |
|
See Footnote Table 4 for Reconciliation of As Reported Net Income to Adjusted Net Income. |
|
|||||
Condensed Consolidated Balance Sheets |
|||||
(Millions of dollars) |
|||||
(Unaudited) |
|||||
|
|
|
|
||
|
2022 |
|
2021 |
||
Assets |
|||||
Current assets: |
|
|
|
||
Cash and equivalents |
$ |
2,226 |
|
$ |
3,044 |
Receivables, net |
|
4,390 |
|
|
3,666 |
Inventories |
|
2,654 |
|
|
2,361 |
Other current assets |
|
992 |
|
|
872 |
Total current assets |
|
10,262 |
|
|
9,943 |
Property, plant, and equipment, net |
|
4,165 |
|
|
4,326 |
|
|
2,828 |
|
|
2,843 |
Deferred income taxes |
|
2,703 |
|
|
2,695 |
Operating lease right-of-use assets |
|
894 |
|
|
934 |
Other assets |
|
1,593 |
|
|
1,580 |
Total assets |
$ |
22,445 |
|
$ |
22,321 |
|
|
|
|
||
Liabilities and Shareholders’ Equity |
|||||
Current liabilities: |
|
|
|
||
Accounts payable |
$ |
2,794 |
|
$ |
2,353 |
Accrued employee compensation and benefits |
|
513 |
|
|
493 |
Current portion of operating lease liabilities |
|
227 |
|
|
240 |
Other current liabilities |
|
1,232 |
|
|
1,220 |
Total current liabilities |
|
4,766 |
|
|
4,306 |
Long-term debt |
|
8,525 |
|
|
9,127 |
Operating lease liabilities |
|
786 |
|
|
845 |
Employee compensation and benefits |
|
466 |
|
|
492 |
Other liabilities |
|
754 |
|
|
823 |
Total liabilities |
|
15,297 |
|
|
15,593 |
Company shareholders’ equity |
|
7,130 |
|
|
6,713 |
Noncontrolling interest in consolidated subsidiaries |
|
18 |
|
|
15 |
Total shareholders’ equity |
|
7,148 |
|
|
6,728 |
Total liabilities and shareholders’ equity |
$ |
22,445 |
$ |
22,321 |
|
|
|||||||||||
Condensed Consolidated Statements of Cash Flows |
|||||||||||
(Millions of dollars) |
|||||||||||
(Unaudited) |
|||||||||||
|
Six Months Ended |
|
Three Months
|
||||||||
|
|
|
|
||||||||
|
2022 |
|
2021 |
|
2022 |
||||||
Cash flows from operating activities: |
|
|
|
|
|
||||||
Net income |
$ |
381 |
|
|
$ |
401 |
|
|
$ |
117 |
|
Adjustments to reconcile net income to cash flows from operating activities: |
|
|
|
|
|
||||||
Depreciation, depletion, and amortization |
|
470 |
|
|
|
449 |
|
|
|
238 |
|
Impairments and other charges |
|
366 |
|
|
|
— |
|
|
|
344 |
|
Working capital (a) |
|
(810 |
) |
|
|
11 |
|
|
|
(424 |
) |
Other operating activities |
|
(81 |
) |
|
|
(249 |
) |
|
|
101 |
|
Total cash flows provided by operating activities |
|
326 |
|
|
|
612 |
|
|
|
376 |
|
Cash flows from investing activities: |
|
|
|
|
|
||||||
Capital expenditures |
|
(410 |
) |
|
|
(295 |
) |
|
|
(221 |
) |
Proceeds from sales of property, plant, and equipment |
|
116 |
|
|
|
105 |
|
|
|
60 |
|
Other investing activities |
|
(54 |
) |
|
|
(31 |
) |
|
|
(32 |
) |
Total cash flows used in investing activities |
|
(348 |
) |
|
|
(221 |
) |
|
|
(193 |
) |
Cash flows from financing activities: |
|
|
|
|
|
||||||
Payments on long-term borrowings |
|
(642 |
) |
|
|
(192 |
) |
|
|
(2 |
) |
Dividends to shareholders |
|
(217 |
) |
|
|
(80 |
) |
|
|
(109 |
) |
Other financing activities |
|
116 |
|
|
|
4 |
|
|
|
36 |
|
Total cash flows used in financing activities |
|
(743 |
) |
|
|
(268 |
) |
|
|
(75 |
) |
Effect of exchange rate changes on cash |
|
(53 |
) |
|
|
(28 |
) |
|
|
(36 |
) |
Increase (decrease) in cash and equivalents |
|
(818 |
) |
|
|
95 |
|
|
|
72 |
|
Cash and equivalents at beginning of period |
|
3,044 |
|
|
|
2,563 |
|
|
|
2,154 |
|
Cash and equivalents at end of period |
$ |
2,226 |
|
|
$ |
2,658 |
|
|
$ |
2,226 |
|
(a) |
Working capital includes receivables, inventories, and accounts payable. |
See Footnote Table 5 for Reconciliation of Cash Flows from Operating Activities to Free Cash Flow. |
|
|||||||||||
Revenue and Operating Income Comparison |
|||||||||||
By Operating Segment and |
|||||||||||
(Millions of dollars) |
|||||||||||
(Unaudited) |
|||||||||||
|
Three Months Ended |
||||||||||
|
|
|
|
||||||||
Revenue |
2022 |
|
2021 |
|
2022 |
||||||
By operating segment: |
|
|
|
|
|
||||||
Completion and Production |
$ |
2,911 |
|
|
$ |
2,048 |
|
|
$ |
2,353 |
|
Drilling and Evaluation |
|
2,163 |
|
|
|
1,659 |
|
|
|
1,931 |
|
Total revenue |
$ |
5,074 |
|
|
$ |
3,707 |
|
|
$ |
4,284 |
|
|
|
|
|
|
|
||||||
By geographic region: |
|
|
|
|
|
||||||
|
$ |
2,426 |
|
|
$ |
1,569 |
|
|
$ |
1,925 |
|
|
|
758 |
|
|
|
534 |
|
|
|
653 |
|
|
|
718 |
|
|
|
679 |
|
|
|
677 |
|
|
|
1,172 |
|
|
|
925 |
|
|
|
1,029 |
|
Total revenue |
$ |
5,074 |
|
|
$ |
3,707 |
|
|
$ |
4,284 |
|
|
|
|
|
|
|
||||||
Operating Income |
|
|
|
|
|
||||||
By operating segment: |
|
|
|
|
|
||||||
Completion and Production |
$ |
499 |
|
|
$ |
317 |
|
|
$ |
296 |
|
Drilling and Evaluation |
|
286 |
|
|
|
175 |
|
|
|
294 |
|
Total |
|
785 |
|
|
|
492 |
|
|
|
590 |
|
Corporate and other |
|
(67 |
) |
|
|
(58 |
) |
|
|
(57 |
) |
Impairments and other charges |
|
(344 |
) |
|
|
— |
|
|
|
(22 |
) |
Total operating income |
$ |
374 |
|
|
$ |
434 |
|
|
$ |
511 |
|
|
|||||||||||
See Footnote Table 1 for Reconciliation of As Reported Operating Income to Adjusted Operating Income. |
|
|||||||
Revenue and Operating Income Comparison |
|||||||
By Operating Segment and |
|||||||
(Millions of dollars) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended |
||||||
|
|
||||||
Revenue |
2022 |
|
2021 |
||||
By operating segment: |
|
|
|
||||
Completion and Production |
$ |
5,264 |
|
|
$ |
3,918 |
|
Drilling and Evaluation |
|
4,094 |
|
|
|
3,240 |
|
Total revenue |
$ |
9,358 |
|
|
$ |
7,158 |
|
|
|
|
|
||||
By geographic region: |
|
|
|
||||
|
$ |
4,351 |
|
|
$ |
2,973 |
|
|
|
1,411 |
|
|
|
1,069 |
|
|
|
1,395 |
|
|
|
1,313 |
|
|
|
2,201 |
|
|
|
1,803 |
|
Total revenue |
$ |
9,358 |
|
|
$ |
7,158 |
|
|
|
|
|
||||
Operating Income |
|
|
|
||||
By operating segment: |
|
|
|
||||
Completion and Production |
$ |
795 |
|
|
$ |
569 |
|
Drilling and Evaluation |
|
580 |
|
|
|
346 |
|
Total |
|
1,375 |
|
|
|
915 |
|
Corporate and other |
|
(124 |
) |
|
|
(111 |
) |
Impairments and other charges |
|
(366 |
) |
|
|
— |
|
Total operating income |
$ |
885 |
|
|
$ |
804 |
|
|
|
|
|
||||
See Footnote Table 2 for Reconciliation of As Reported Operating Income to Adjusted Operating Income. |
FOOTNOTE TABLE 1 |
|||||||||
|
|
||||||||
|
|||||||||
Reconciliation of As Reported Operating Income to Adjusted Operating Income |
|||||||||
(Millions of dollars) |
|||||||||
(Unaudited) |
|||||||||
|
Three Months Ended |
||||||||
|
|
|
|
||||||
|
2022 |
|
2021 |
|
2022 |
||||
As reported operating income |
$ |
374 |
|
|
$ |
434 |
|
$ |
511 |
|
|
|
|
|
|
||||
Impairments and other charges: |
|
|
|
|
|
||||
Receivables |
|
186 |
|
|
|
— |
|
|
16 |
Property, plant, and equipment, net |
|
100 |
|
|
|
— |
|
|
— |
Inventory |
|
70 |
|
|
|
— |
|
|
— |
Other |
|
(12 |
) |
|
|
— |
|
|
6 |
Total impairments and other charges (a) |
|
344 |
|
|
|
— |
|
|
22 |
Adjusted operating income (b) |
$ |
718 |
|
|
$ |
434 |
|
$ |
533 |
(a) |
During the three months ended |
(b) |
Management believes that operating income adjusted for impairments and other charges for the three months ended |
FOOTNOTE TABLE 2 |
||||||
|
|
|||||
|
||||||
Reconciliation of As Reported Operating Income to Adjusted Operating Income |
||||||
(Millions of dollars) |
||||||
(Unaudited) |
||||||
|
Six Months Ended |
|||||
|
|
|||||
|
2022 |
|
2021 |
|||
As reported operating income |
$ |
885 |
|
|
$ |
804 |
|
|
|
|
|||
Impairments and other charges: |
|
|
|
|||
Receivables |
|
202 |
|
|
|
— |
Property, plant, and equipment, net |
|
100 |
|
|
|
— |
Inventory |
|
70 |
|
|
|
— |
Other |
|
(6 |
) |
|
|
— |
Total impairments and other charges (a) |
|
366 |
|
|
|
— |
Adjusted operating income (b) |
$ |
1,251 |
|
|
$ |
804 |
(a) |
During the six months ended |
(b) |
Management believes that operating income adjusted for impairments and other charges for the six months ended |
FOOTNOTE TABLE 3 |
||||||||||
|
|
|||||||||
|
||||||||||
Reconciliation of As Reported Net Income to Adjusted Net Income |
||||||||||
(Millions of dollars and shares except per share data) |
||||||||||
(Unaudited) |
||||||||||
|
Three Months Ended |
|||||||||
|
|
|
|
|||||||
|
2022 |
|
2021 |
|
2022 |
|||||
As reported net income attributable to company |
$ |
109 |
|
|
$ |
227 |
|
$ |
263 |
|
|
|
|
|
|
|
|||||
Adjustments: |
|
|
|
|
|
|||||
Impairments and other charges |
|
344 |
|
|
|
— |
|
|
22 |
|
Loss on early extinguishment of debt |
|
— |
|
|
|
— |
|
|
42 |
|
Total adjustments, before taxes |
|
344 |
|
|
|
— |
|
|
64 |
|
Tax benefit (a) |
|
(11 |
) |
|
|
— |
|
|
(13 |
) |
Total adjustments, net of taxes (b) |
|
333 |
|
|
|
— |
|
|
51 |
|
Adjusted net income attributable to company (b) |
$ |
442 |
|
|
$ |
227 |
|
$ |
314 |
|
|
|
|
|
|
|
|||||
Diluted weighted average common shares outstanding |
|
909 |
|
|
|
890 |
|
|
903 |
|
As reported net income per diluted share (c) |
$ |
0.12 |
|
|
$ |
0.26 |
|
$ |
0.29 |
|
Adjusted net income per diluted share (c) |
$ |
0.49 |
|
|
$ |
0.26 |
|
$ |
0.35 |
|
(a) |
The tax benefit in the table above includes the tax effect on the impairments and other charges during the three months ended |
(b) |
Management believes that net income adjusted for the impairments and other charges and loss on the early extinguishment of debt, is useful to investors to assess and understand operating performance, especially when comparing those results with previous and subsequent periods or forecasting performance for future periods, primarily because management views the excluded items to be outside of the company's normal operating results. Management analyzes net income without the impact of these items as an indicator of performance to identify underlying trends in the business and to establish operational goals. Total adjustments remove the effect of these items. Adjusted net income attributable to company is calculated as: “As reported net income attributable to company” plus "Total adjustments, net of taxes" for the respective periods. |
(c) |
As reported net income per diluted share is calculated as: "As reported net income attributable to company" divided by "Diluted weighted average common shares outstanding." Adjusted net income per diluted share is calculated as: "Adjusted net income attributable to company" divided by "Diluted weighted average common shares outstanding." |
FOOTNOTE TABLE 4 |
||||||
|
|
|||||
|
||||||
Reconciliation of As Reported Net Income to Adjusted Net Income |
||||||
(Millions of dollars and shares except per share data) |
||||||
(Unaudited) |
||||||
|
Six Months Ended |
|||||
|
|
|||||
|
2022 |
|
2021 |
|||
As reported net income attributable to company |
$ |
372 |
|
|
$ |
397 |
|
|
|
|
|||
Adjustments: |
|
|
|
|||
Impairments and other charges |
|
366 |
|
|
|
— |
Loss on early extinguishment of debt |
|
42 |
|
|
|
— |
Total adjustments, before taxes |
|
408 |
|
|
|
— |
Tax benefit (a) |
|
(24 |
) |
|
|
— |
Total adjustments, net of taxes (b) |
|
384 |
|
|
|
— |
Adjusted net income attributable to company (b) |
$ |
756 |
|
|
$ |
397 |
|
|
|
|
|||
Diluted weighted average common shares outstanding |
|
906 |
|
|
|
889 |
As reported net income per diluted share (c) |
$ |
0.41 |
|
|
$ |
0.45 |
Adjusted net income per diluted share (c) |
$ |
0.83 |
|
|
$ |
0.45 |
(a) |
The tax benefit in the table above includes the tax effect on impairments and other charges and the loss on early extinguishment of debt during the six months ended |
(b) |
Management believes that net income adjusted for impairments and other charges and the loss on early extinguishment of debt, is useful to investors to assess and understand operating performance, especially when comparing those results with previous and subsequent periods or forecasting performance for future periods, primarily because management views the excluded items to be outside of the company's normal operating results. Management analyzes net income without the impact of these items as an indicator of performance to identify underlying trends in the business and to establish operational goals. Total adjustments remove the effect of these items. Adjusted net income attributable to company is calculated as: “As reported net income attributable to company” plus "Total adjustments, net of taxes" for the respective periods. |
(c) |
As reported net income per diluted share is calculated as: "As reported net income attributable to company" divided by "Diluted weighted average common shares outstanding." Adjusted net income per diluted share is calculated as: "Adjusted net income attributable to company" divided by "Diluted weighted average common shares outstanding." |
FOOTNOTE TABLE 5 |
|||||||||||
|
|
|
|
||||||||
|
|||||||||||
Reconciliation of Cash Flows from Operating Activities to Free Cash Flow |
|||||||||||
(Millions of dollars) |
|||||||||||
(Unaudited) |
|||||||||||
|
Six Months Ended |
|
Three Months Ended |
||||||||
|
|
|
|
||||||||
|
2022 |
|
2021 |
|
2022 |
||||||
Total cash flows provided by operating activities |
$ |
326 |
|
|
$ |
612 |
|
|
$ |
376 |
|
Capital expenditures |
|
(410 |
) |
|
|
(295 |
) |
|
|
(221 |
) |
Proceeds from sales of property, plant, and equipment |
|
116 |
|
|
|
105 |
|
|
|
60 |
|
Free cash flow (a) |
$ |
32 |
|
|
$ |
422 |
|
|
$ |
215 |
|
(a) |
The Free Cash Flow metric is a non-GAAP financial measure, which is calculated as “Total cash flows provided by operating activities” less “Capital expenditures” plus “Proceeds from sales of property, plant, and equipment.” Management believes that Free Cash Flow is a key measure to assess liquidity of the business and is consistent with the disclosures of our direct, large-cap competitors. |
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FAQ
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