FINANCIAL UPDATE
Despite the challenging environment, the Company's preliminary financial results improved during the first quarter of 2020 due to operational and cost reduction initiatives.
The Company's preliminary financial results for the first quarter of 2020 are: Revenues in the range of
The impact of the COVID-19 pandemic and recent actions by certain producing nations have had an unprecedented disruption on the supply/demand equation for oil, resulting in a precipitous decline in commodity prices and substantial reductions to the capital spending plans of exploration and production companies. In response, Weatherford supplemented its cost reduction initiatives with a number of actions, including: Temporary pay reductions of 20% for management and to the Board of Directors' annual cash retainer; Total headcount reductions across North American operations and the global support structure of 38% and 25%, respectively; Furloughs and pay reductions for remaining employees in
Currently, Weatherford has adequate liquidity and is compliant with its financial covenants. However, the emerging operating environment has led to the inability to predict the depth and length of the industry's weakness. In this backdrop, the Company's debt levels are too high. Management and the Board of Directors are evaluating options to improve liquidity and address the Company's long-term capital structure.
Weatherford plans to release its first quarter 2020 Form 10-Q on
NYSE DELISTING
The Company has been evaluating its options with respect to its NYSE listing and, after careful deliberations, the Board of Directors has determined that delisting is in the best interest of the Company. As such, the Company will withdraw its appeal to the delisting proceedings by the NYSE.
The Company's shares of common stock will be delisted from trading on the NYSE through the filing of a Form 25 with the
Weatherford will continue to evaluate listing on the NYSE or other trading platforms and will provide updates as necessary. The Company will continue to trade on the
Non-GAAP Measures
Weatherford reports its financial results in accordance with
EBITDA is defined as earnings before interest, taxes, depreciation and amortization expense.
Adjusted EBITDA, a non-GAAP measure, is defined as EBITDA adjusted for impairment charges, restructuring charges (severance and facility charges), asset write-downs, noncash stock-based compensation, prepetition charges, reorganization items, gain or loss on sales of businesses, and other non-operating expenses.
Free cash flow is defined as operating cash flow less net capital expenditures (net of any proceeds from the disposition of assets).
In this release, the Company has included certain preliminary estimates of its results of operations for its fiscal quarter ended
About Weatherford
Weatherford is the leading wellbore and production solutions company. Operating in more than 80 countries, the Company answers the challenges of the energy industry with its global talent network of 24,000 team members and 610 locations, which include service, research and development, training, and manufacturing facilities.
Forward-Looking Statements
This press release contains forward-looking statements concerning, among other things, the impact of the COVID-19 pandemic and the Company's response to COVID-19, the Company's liquidity and financial covenants and plans to evaluate the Company's capital structure and future listing options. These forward-looking statements generally identified by the words 'believe,' 'project,' 'expect,' 'anticipate,' 'estimate,' 'outlook,' 'budget,' 'intend,' 'strategy,' 'plan,' 'guidance,' 'may,' 'should,' 'could,' 'will,' 'would,' 'will be,' 'will continue,' 'will likely result,' and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of Weatherford's management and are subject to significant risks, assumptions, and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in the Company's forward-looking statements. Investors are also cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results, including as a result of changes in the macroeconomic outlook for the oil and gas industry, realization of additional cost savings and operational efficiencies, the impact of impairment tests on the carrying value of the Company's assets, the Company's preparedness for and response to the COVID-19 pandemic and the impact of logistical issues and business interruptions associated with COVID-19 on the Company and its customers and suppliers. Forward-looking statements are also affected by the risk factors described in the Company's Annual Report on Form 10-K for the year ended
Contact:
Tel: +1 713-836-6777
Email: investor.relations@weatherford.com
(C) 2020 Electronic News Publishing, source