Baker Hughes Company Announces Third Quarter 2020 Results
- Orders of
$5.1 billion for the quarter, up 4% sequentially and down 34% year-over-year - Revenue of
$5.0 billion for the quarter, up 7% sequentially and down 14% year-over-year - GAAP operating loss of
$49 million for the quarter, up 6% sequentially and unfavorable year-over-year. - Adjusted operating income (a non-GAAP measure) of
$234 million for the quarter was favorable sequentially and down 45% year-over-year. - GAAP loss per share of
$(0.25) for the quarter which included$0.29 per share of adjusting items. Adjusted earnings per share (a non-GAAP measure) was$0.04 . - Cash flows generated from operating activities were
$219 million for the quarter. Free cash flow (a non-GAAP measure) for the quarter was$52 million .
The Company presents its financial results in accordance with GAAP. However, management believes that using additional non-GAAP measures will enhance the evaluation of the profitability of the Company and its ongoing operations. Please see Tables 1a, 1b and 1c in the section entitled "Charges & Credits" for a reconciliation of GAAP to non-GAAP financial measures. Certain columns and rows in our tables and financial statements may not sum up due to the use of rounded numbers.
|
|
Three Months Ended |
|
Variance |
|||||||||
|
(in millions except per share amounts) |
|
|
|
|
Sequential |
Year- |
||||||
|
Orders |
$ |
5,106 |
|
$ |
4,888 |
|
$ |
7,783 |
|
|
4% |
(34)% |
|
Revenue |
5,049 |
|
4,736 |
|
5,882 |
|
|
7% |
(14)% |
|||
|
Operating income (loss) |
(49) |
|
(52) |
|
297 |
|
|
6% |
U |
|||
|
Adjusted operating income (non-GAAP) |
234 |
|
104 |
|
422 |
|
|
F |
(45)% |
|||
|
Net income (loss) attributable to Baker Hughes |
(170) |
|
(195) |
|
57 |
|
|
13% |
U |
|||
|
Adjusted net income (loss) (non-GAAP) attributable to Baker Hughes |
27 |
|
(31) |
|
114 |
|
|
F |
(76)% |
|||
|
EPS attributable to Class A shareholders |
(0.25) |
|
(0.30) |
|
0.11 |
|
|
15% |
U |
|||
|
Adjusted EPS (non-GAAP) attributable to Class A shareholders |
0.04 |
|
(0.05) |
|
0.21 |
|
|
F |
(81)% |
|||
|
Cash flow from operating activities |
219 |
|
230 |
|
360 |
|
|
(5)% |
(39)% |
|||
|
Free cash flow (non-GAAP) |
52 |
|
63 |
|
161 |
|
|
(17)% |
(68)% |
|||
"F" is used in most instances when variance is above 100%. Additionally, "U" is used in most instances when variance is below (100)%.
“Despite continued uncertainty in global oil and gas markets and the ongoing impact of the COVID-19 pandemic, we produced solid results in the third quarter of 2020. I am pleased with the continued execution on cost-out from our Oilfield Services (OFS) and Oilfield Equipment (OFE) teams, the commercial success and performance from Turbomachinery & Process Solutions (TPS) and Digital Solutions (DS), and our continued free cash flow generation during the quarter. I am proud of our employees and their continued commitment to delivering for our customers and shareholders,” said
“After significant turmoil during the first half of the year, oil markets have somewhat stabilized. However, demand recovery is beginning to level off and significant excess capacity remains, which could create volatility in the future. The outlook for natural gas is slightly more optimistic as forward prices have improved with strong demand in
“Despite the uncertain macro environment, we are executing on the framework we laid out earlier this year. We are on track to hit our goals of right-sizing the business, generating free cash flow, and achieving
"As we move forward, we are intensely focused on improving the margin and return profile of Baker Hughes despite the near-term macro volatility, while at the same time executing on our long-term strategy to evolve our portfolio along with the energy landscape. Baker Hughes remains committed to leading the energy transition and becoming a key enabler to decarbonizing oil and gas and other industries,” concluded Simonelli.
Quarter Highlights
Supporting our Customers
The TPS segment secured a major LNG order with longtime partner
TPS also continued to innovate its FPSO technologies to support sustainable operations. The business was awarded a FPSO contract in
The OFS segment delivered 83% of its global drilling services jobs remotely, compared to 72% in the second quarter. OFS remote operations have led to consistently better outcomes for customers at a record pace, and remote drilling increased most prominently in
In the OFE segment, the Flexible Pipe Systems product line continues to gain traction in
OFE also secured a major services contract for the supply of conductor casings for all the deep well drilling programs and associated logistics for a customer in the
The DS segment secured a major three-year frame agreement with Petrobras for multiple solutions from our
DS also secured several contracts to deliver advanced technologies for LNG, power generation, and pipeline infrastructure.
Executing on Priorities
Following several consecutive quarters securing large downstream chemicals contracts, the OFS Chemicals product line continued to win contracts in the third quarter including a five-year contract to provide process and fuel treatment products and services to HollyFrontier in
OFS also continued to focus on its differentiated portfolio with another consecutive quarter securing multi-year contracts for drilling services, completions, and artificial lift. In
TPS achieved important execution milestones for LNG projects in the third quarter. In September, TPS completed the successful mechanical and performance tests for one of its largest size expander-compressors for Novatek’s Arctic LNG 2 project. TPS also completed the first phase of the Calcasieu Pass LNG project with Venture Global, shipping the first two equipment modules from Baker Hughes’ facility in
DS continued to drive growth across industrial end markets, including aerospace and automotive.
Leading with Innovation
Baker Hughes continued to drive advancements in leading technologies while supporting its strategy to lead in the energy transition. TPS successfully tested the world’s first “hybrid” hydrogen turbine designed for a gas network with Snam, paving the way to implement adoption of hydrogen blended with natural gas in Snam’s current transportation network infrastructure. The test used a NovaLT™12 gas turbine with a 10% blend of hydrogen with natural gas. Once installed, the turbine can compress and move hydrogen fuel blends through Snam’s network of pipelines while using the same fuel to power itself, significantly contributing to the reduction of CO2 emissions in
OFS introduced the Lucida advanced rotary steerable service, which integrates hardware, software, automation, and remote connectivity to help customers drill faster and deliver more precise, higher-quality wells. The service fully complements OFS’ automation and remote operations services. Lucida is designed to maximize directional drilling performance and well productivity by incorporating advanced electronics and near-bit sensors that enable drillers to more precisely guide bottomhole assemblies.
OFE launched the Terminator vessel-deployed subsea wellhead cutting system, using a first-of-its-kind mechanical wellhead removal method to reduce time, fuel consumption and safety risks . Terminator was successfully launched with Wintershall DEA in
DS continued to gain traction with its innovative Flare.IQ technology, securing a five-year contract with a North American customer. A key technology in Baker Hughes’ energy transition portfolio, Flare.IQ helps operators manage their flare assets remotely and can also reduce methane emissions, ensure high-efficiency flare combustion, and reduce steam usage in flare systems using advanced sensors and analytics.
The BakerHughesC3.ai joint venture alliance secured a contract with a customer in the
Consolidated Results by Reporting Segment
|
Consolidated Orders by Reporting Segment |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Consolidated segment orders |
|
|
|
|
Sequential |
Year- |
||||||||
|
Oilfield Services |
$ |
2,296 |
|
$ |
2,411 |
|
$ |
3,354 |
|
|
(5) |
% |
(32) |
% |
|
Oilfield Equipment |
432 |
|
699 |
|
1,029 |
|
|
(38) |
% |
(58) |
% |
|||
|
Turbomachinery & Process Solutions |
1,885 |
|
1,313 |
|
2,784 |
|
|
44 |
% |
(32) |
% |
|||
|
Digital Solutions |
493 |
|
465 |
|
616 |
|
|
6 |
% |
(20) |
% |
|||
|
Total |
$ |
5,106 |
|
$ |
4,888 |
|
$ |
7,783 |
|
|
4 |
% |
(34) |
% |
Orders for the quarter were
Year-over-year, the decline in orders was a result of lower order intake across all segments. Year-over-year equipment orders were down 40% and service orders were down 28%.
The Company's total book-to-bill ratio in the quarter was 1; the equipment book-to-bill ratio in the quarter was 1.1.
Remaining Performance Obligations (RPO) in the third quarter ended at
|
Consolidated Revenue by Reporting Segment |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Consolidated segment revenue |
|
|
|
|
Sequential |
Year-over |
||||||||
|
Oilfield Services |
$ |
2,308 |
|
$ |
2,411 |
|
$ |
3,348 |
|
|
(4) |
% |
(31) |
% |
|
Oilfield Equipment |
726 |
|
696 |
|
728 |
|
|
4 |
% |
— |
% |
|||
|
Turbomachinery & Process Solutions |
1,513 |
|
1,161 |
|
1,197 |
|
|
30 |
% |
26 |
% |
|||
|
Digital Solutions |
503 |
|
468 |
|
609 |
|
|
7 |
% |
(17) |
% |
|||
|
Total |
$ |
5,049 |
|
$ |
4,736 |
|
$ |
5,882 |
|
|
7 |
% |
(14) |
% |
Revenue for the quarter was
Compared to the same quarter last year, revenue was down 14%, driven by lower volume across the Oilfield Services and Digital Solutions segments, partially offset by Turbomachinery & Process Solutions.
|
Consolidated Operating Income by Reporting Segment |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Segment operating income |
|
|
|
|
Sequential |
Year-over- |
||||||||
|
Oilfield Services |
$ |
93 |
|
$ |
46 |
|
$ |
274 |
|
|
F |
(66) |
% |
|
|
Oilfield Equipment |
19 |
|
(14) |
|
14 |
|
|
F |
37 |
% |
||||
|
Turbomachinery & Process Solutions |
191 |
|
149 |
|
161 |
|
|
28 |
% |
18 |
% |
|||
|
Digital Solutions |
46 |
|
41 |
|
82 |
|
|
12 |
% |
(44) |
% |
|||
|
Total segment operating income |
349 |
|
221 |
|
531 |
|
|
57 |
% |
(34) |
% |
|||
|
Corporate |
(115) |
|
(117) |
|
(109) |
|
|
2 |
% |
(5) |
% |
|||
|
Inventory impairment |
(42) |
|
(16) |
|
— |
|
|
U |
U |
|||||
|
Restructuring, impairment & other charges |
(209) |
|
(103) |
|
(71) |
|
|
U |
U |
|||||
|
Separation related |
(32) |
|
(37) |
|
(54) |
|
|
13 |
% |
41 |
% |
|||
|
Operating income (loss) |
(49) |
|
(52) |
|
297 |
|
|
6 |
% |
U |
||||
|
Adjusted operating income* |
$ |
234 |
|
$ |
104 |
|
$ |
422 |
|
|
F |
(45) |
% |
|
*Non-GAAP measure.
"F" is used in most instances when variance is above 100%. Additionally, "U" is used in most instances when variance is below (100)%.
On a GAAP basis, operating loss for the third quarter of 2020 was
Adjusted operating income (a non-GAAP measure) for the third quarter of 2020 was
Depreciation and amortization for the third quarter of 2020 was
Corporate costs were
Other Financial Items
Income tax expense in the third quarter of 2020 was
Other non-operating loss in the third quarter of 2020 was
GAAP diluted loss per share was
Cash flow from operating activities was
Capital expenditures, net of proceeds from disposal of assets, were
Results by Reporting Segment
The following segment discussions and variance explanations are intended to reflect management's view of the relevant comparisons of financial results on a sequential or year-over-year basis, depending on the business dynamics of the reporting segments.
|
Oilfield Services |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Oilfield Services |
|
|
|
|
Sequential |
Year-over- |
||||||||
|
Revenue |
$ |
2,308 |
|
$ |
2,411 |
|
$ |
3,348 |
|
|
(4) |
% |
(31) |
% |
|
Operating income |
$ |
93 |
|
$ |
46 |
|
$ |
274 |
|
|
F |
(66) |
% |
|
|
Operating income margin |
4.0 |
% |
1.9 |
% |
8.2 |
% |
|
2.1pts |
-4.2pts |
|||||
Oilfield Services (OFS) revenue of
Segment operating income before tax for the quarter was
|
Oilfield Equipment |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Oilfield Equipment |
|
|
|
|
Sequential |
Year-over- |
||||||||
|
Orders |
$ |
432 |
|
$ |
699 |
|
$ |
1,029 |
|
|
(38) |
% |
(58) |
% |
|
Revenue |
$ |
726 |
|
$ |
696 |
|
$ |
728 |
|
|
4 |
% |
— |
% |
|
Operating income (loss) |
$ |
19 |
|
$ |
(14) |
|
$ |
14 |
|
|
F |
37 |
% |
|
|
Operating income margin |
2.6 |
% |
(2.1) |
% |
1.9 |
% |
|
4.7pts |
0.7pts |
|||||
Oilfield Equipment (OFE) orders were down
OFE revenue of
Segment operating income before tax for the quarter was
|
Turbomachinery & Process Solutions |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Turbomachinery & Process Solutions |
|
|
|
|
Sequential |
Year-over- |
||||||||
|
Orders |
$ |
1,885 |
|
$ |
1,313 |
|
$ |
2,784 |
|
|
44 |
% |
(32) |
% |
|
Revenue |
$ |
1,513 |
|
$ |
1,161 |
|
$ |
1,197 |
|
|
30 |
% |
26 |
% |
|
Operating income |
$ |
191 |
|
$ |
149 |
|
$ |
161 |
|
|
28 |
% |
18 |
% |
|
Operating income margin |
12.6 |
% |
12.8 |
% |
13.5 |
% |
|
-0.2pts |
-0.9pts |
|||||
Turbomachinery & Process Solutions (TPS) orders were down 32% year-over-year. Equipment orders were down 39% and service orders were down 17%.
TPS revenue of
Segment operating income before tax for the quarter was
|
Digital Solutions |
||||||||||||||
|
(in millions) |
Three Months Ended |
|
Variance |
|||||||||||
|
Digital Solutions |
|
|
|
|
Sequential |
Year-over- |
||||||||
|
Orders |
$ |
493 |
|
$ |
465 |
|
$ |
616 |
|
|
6 |
% |
(20) |
% |
|
Revenue |
$ |
503 |
|
$ |
468 |
|
$ |
609 |
|
|
7 |
% |
(17) |
% |
|
Operating income |
$ |
46 |
|
$ |
41 |
|
$ |
82 |
|
|
12 |
% |
(44) |
% |
|
Operating income margin |
9.2 |
% |
8.8 |
% |
13.5 |
% |
|
0.3pts |
-4.4pts |
|||||
Digital Solutions (DS) orders were down 20% year-over-year, driven by lower order intake across all businesses.
DS revenue of
Segment operating income before tax for the quarter was
Charges & Credits
|
Table 1a. Reconciliation of GAAP and Adjusted Operating Income/(Loss) |
|||||||||
|
|
Three Months Ended |
||||||||
|
(in millions) |
|
|
|
||||||
|
Operating income (loss) (GAAP) |
$ |
(49) |
|
$ |
(52) |
|
$ |
297 |
|
|
Separation related |
32 |
|
37 |
|
54 |
|
|||
|
Restructuring, impairment & other |
209 |
|
103 |
|
71 |
|
|||
|
Inventory impairment |
42 |
|
16 |
|
— |
|
|||
|
Total operating income adjustments |
283 |
|
156 |
|
125 |
|
|||
|
Adjusted operating income (non-GAAP) |
$ |
234 |
|
$ |
104 |
|
$ |
422 |
|
Table 1a reconciles operating income (loss), which is the directly comparable financial result determined in accordance with Generally Accepted Accounting Principles (GAAP), to adjusted operating income (a non-GAAP financial measure). Adjusted operating income excludes the impact of certain identified items.
|
Table 1b. Reconciliation of GAAP and Non-GAAP Net Income |
|||||||||
|
|
Three Months Ended |
||||||||
|
(in millions, except per share amounts) |
|
|
|
||||||
|
Net income (loss) attributable to Baker Hughes (GAAP) |
$ |
(170) |
|
$ |
(195) |
|
$ |
57 |
|
|
Total operating income adjustments (identified items) |
283 |
|
156 |
|
125 |
|
|||
|
Other adjustments (non-operating) (1) |
90 |
|
156 |
|
— |
|
|||
|
Tax on total adjustments |
(54) |
|
(11) |
|
(15) |
|
|||
|
Total adjustments, net of income tax |
319 |
|
301 |
|
110 |
|
|||
|
Less: adjustments attributable to noncontrolling interests |
122 |
|
138 |
|
53 |
|
|||
|
Adjustments attributable to Baker Hughes |
197 |
|
164 |
|
57 |
|
|||
|
Adjusted net income (loss) attributable to Baker Hughes (non-GAAP) |
$ |
27 |
|
$ |
(31) |
|
$ |
114 |
|
|
|
|
|
|
||||||
|
|
|
|
|
||||||
|
Denominator: |
|
|
|
||||||
|
Weighted-average shares of Class A common stock outstanding diluted |
678 |
|
655 |
|
541 |
|
|||
|
Adjusted earnings per Class A share— diluted (non-GAAP) |
$ |
0.04 |
|
$ |
(0.05) |
|
$ |
0.21 |
|
|
(1) |
3Q'20: Primarily driven by loss on the write-down of assets held for sale partially offset by a tax benefit related to the CARES Act. 2Q'20: Primarily driven by loss on sale of business partially offset by a tax benefit related to the CARES Act. |
Table 1b reconciles net income (loss) attributable to Baker Hughes, which is the directly comparable financial result determined in accordance with GAAP, to adjusted net income attributable to Baker Hughes (a non-GAAP financial measure). Adjusted net income attributable to Baker Hughes excludes the impact of certain identified items.
|
Table 1c. Reconciliation of Cash Flow From Operating Activities to Free Cash Flow |
|||||||||
|
|
Three Months Ended |
||||||||
|
(in millions) |
|
|
|
||||||
|
Cash flow from operating activities (GAAP) |
$ |
219 |
|
$ |
230 |
|
$ |
360 |
|
|
Add: cash used in capital expenditures, net of proceeds from disposal of assets |
(167) |
|
(167) |
|
(199) |
|
|||
|
Free cash flow (non-GAAP) |
$ |
52 |
|
$ |
63 |
|
$ |
161 |
|
Table 1c reconciles net cash flows from operating activities, which is the directly comparable financial result determined in accordance with GAAP, to free cash flow (a non-GAAP financial measure). Free cash flow is defined as net cash flows from operating activities less expenditures for capital assets plus proceeds from disposal of assets.
Management provides non-GAAP financial measures in Tables 1a, 1b, and 1c because it believes such measures are widely accepted financial indicators used by investors and analysts to analyze and compare companies on the basis of operating performance and liquidity, and that these measures may be used by investors to make informed investment decisions.
Financial Tables (GAAP)
|
Condensed Consolidated Statements of Income (Loss) (Unaudited) |
||||||||||||
|
|
Three Months Ended |
Nine Months Ended |
||||||||||
|
(In millions, except per share amounts) |
2020 |
2019 |
2020 |
2019 |
||||||||
|
Revenue |
$ |
5,049 |
|
$ |
5,882 |
|
$ |
15,210 |
|
$ |
17,490 |
|
|
Costs and expenses: |
|
|
|
|
||||||||
|
Cost of revenue |
4,292 |
|
4,781 |
|
13,020 |
|
14,352 |
|
||||
|
Selling, general and administrative |
565 |
|
679 |
|
1,830 |
|
2,083 |
|
||||
|
|
— |
|
— |
|
14,773 |
|
— |
|
||||
|
Restructuring, impairment and other |
209 |
|
71 |
|
1,637 |
|
183 |
|
||||
|
Separation related |
32 |
|
54 |
|
110 |
|
128 |
|
||||
|
Total costs and expenses |
5,098 |
|
5,585 |
|
31,370 |
|
16,746 |
|
||||
|
Operating income (loss) |
(49) |
|
297 |
|
(16,160) |
|
744 |
|
||||
|
Other non-operating loss, net |
(149) |
|
(14) |
|
(367) |
|
(124) |
|
||||
|
Interest expense, net |
(66) |
|
(59) |
|
(195) |
|
(174) |
|
||||
|
Income (loss) before income taxes |
(264) |
|
224 |
|
(16,722) |
|
446 |
|
||||
|
Benefit (provision) for income taxes |
(6) |
|
(107) |
|
10 |
|
(269) |
|
||||
|
Net income (loss) |
(270) |
|
117 |
|
(16,712) |
|
177 |
|
||||
|
Less: Net income (loss) attributable to noncontrolling interests |
(100) |
|
60 |
|
(6,120) |
|
97 |
|
||||
|
Net income (loss) attributable to |
$ |
(170) |
|
$ |
57 |
|
$ |
(10,592) |
|
$ |
80 |
|
|
|
|
|
|
|
||||||||
|
Per share amounts: |
|
|
|
|||||||||
|
Basic and diluted income (loss) per Class A common share |
$ |
(0.25) |
|
$ |
0.11 |
|
$ |
(16.01) |
|
$ |
0.15 |
|
|
|
|
|
|
|
||||||||
|
Weighted average shares: |
|
|
|
|
||||||||
|
Class A basic |
676 |
|
538 |
|
662 |
|
523 |
|
||||
|
Class A diluted |
676 |
|
541 |
|
662 |
|
525 |
|
||||
|
|
|
|
|
|
||||||||
|
Cash dividend per Class A common share |
$ |
0.18 |
|
$ |
0.18 |
|
$ |
0.54 |
|
$ |
0.54 |
|
|
|
|
|
|
|
||||||||
|
Condensed Consolidated Statements of Financial Position (Unaudited) |
||||||
|
(In millions) |
|
|
||||
|
ASSETS |
||||||
|
Current Assets: |
|
|
||||
|
Cash and cash equivalents (1) |
$ |
4,061 |
|
$ |
3,249 |
|
|
Current receivables, net |
5,647 |
|
6,416 |
|
||
|
Inventories, net |
4,469 |
|
4,608 |
|
||
|
All other current assets |
1,031 |
|
949 |
|
||
|
Total current assets |
15,208 |
|
15,222 |
|
||
|
Property, plant and equipment, less accumulated depreciation |
5,536 |
|
6,240 |
|
||
|
|
5,923 |
|
20,690 |
|
||
|
Other intangible assets, net |
4,377 |
|
5,381 |
|
||
|
Contract and other deferred assets |
1,971 |
|
1,881 |
|
||
|
All other assets |
4,324 |
|
3,955 |
|
||
|
Total assets (1) |
$ |
37,339 |
|
$ |
53,369 |
|
|
LIABILITIES AND EQUITY |
||||||
|
Current Liabilities: |
|
|
||||
|
Accounts payable |
$ |
3,482 |
|
$ |
4,268 |
|
|
Short-term debt and current portion of long-term debt (1) |
935 |
|
321 |
|
||
|
Progress collections and deferred income |
3,623 |
|
2,870 |
|
||
|
All other current liabilities |
2,599 |
|
2,555 |
|
||
|
Total current liabilities |
10,639 |
|
10,014 |
|
||
|
Long-term debt |
6,754 |
|
6,301 |
|
||
|
Liabilities for pensions and other employee benefits |
1,147 |
|
1,079 |
|
||
|
All other liabilities |
1,550 |
|
1,476 |
|
||
|
Equity |
17,249 |
|
34,499 |
|
||
|
Total liabilities and equity |
$ |
37,339 |
|
$ |
53,369 |
|
|
(1) |
Total assets include |
|
Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||||||
|
|
Three Months |
Nine Months Ended |
|||||||
|
(In millions) |
2020 |
2020 |
2019 |
||||||
|
Cash flows from operating activities: |
|
|
|
||||||
|
Net income (loss) |
$ |
(270) |
|
$ |
(16,712) |
|
$ |
177 |
|
|
Adjustments to reconcile net income (loss) to net cash flows from operating activities: |
|
|
|
||||||
|
Depreciation and amortization |
315 |
|
1,010 |
|
1,065 |
|
|||
|
|
— |
|
14,773 |
|
— |
|
|||
|
Other asset impairments |
110 |
|
1,237 |
|
— |
|
|||
|
Loss on sale of business |
— |
|
217 |
|
138 |
|
|||
|
Write-down of assets held for sale |
129 |
|
129 |
|
— |
|
|||
|
Benefit for deferred income taxes |
(109) |
|
(265) |
|
(46) |
|
|||
|
Working capital |
(133) |
|
255 |
|
(86) |
|
|||
|
Other operating items, net |
177 |
|
283 |
|
(479) |
|
|||
|
Net cash flows from operating activities |
219 |
|
927 |
|
769 |
|
|||
|
Cash flows from investing activities: |
|
|
|
||||||
|
Expenditures for capital assets, net of proceeds from disposal of assets |
(167) |
|
(660) |
|
(672) |
|
|||
|
Other investing items, net |
53 |
|
109 |
|
13 |
|
|||
|
Net cash flows used in investing activities |
(114) |
|
(551) |
|
(659) |
|
|||
|
Cash flows from financing activities: |
|
|
|
||||||
|
Net repayments of debt and other borrowings |
(21) |
|
(170) |
|
(227) |
|
|||
|
Proceeds from issuance of commercial paper |
— |
|
737 |
|
— |
|
|||
|
Proceeds from issuance of long-term debt |
— |
|
500 |
|
— |
|
|||
|
Dividends paid |
(123) |
|
(359) |
|
(278) |
|
|||
|
Distributions to |
(63) |
|
(199) |
|
(282) |
|
|||
|
Repurchase of common units from |
— |
|
— |
|
(250) |
|
|||
|
Other financing items, net |
6 |
|
(15) |
|
41 |
|
|||
|
Net cash flows from (used in) financing activities |
(201) |
|
494 |
|
(996) |
|
|||
|
Effect of currency exchange rate changes on cash and cash equivalents |
25 |
|
(58) |
|
(29) |
|
|||
|
Increase (decrease) in cash and cash equivalents |
(71) |
|
812 |
|
(915) |
|
|||
|
Cash and cash equivalents, beginning of period |
4,132 |
|
3,249 |
|
3,723 |
|
|||
|
Cash and cash equivalents, end of period |
$ |
4,061 |
|
$ |
4,061 |
|
$ |
2,808 |
|
Supplemental Financial Information
Supplemental financial information can be found on the Company’s website at: investors.bakerhughes.com in the Financial Information section under Quarterly Results.
Conference Call and Webcast
The Company has scheduled an investor conference call to discuss management’s outlook and the results reported in today’s earnings announcement. The call will begin at
Forward-Looking Statements
This news release (and oral statements made regarding the subjects of this release) may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, (each a “forward-looking statement”). The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “estimate,” “project,” “foresee,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “potential,” “would,” “may,” “probable,” “likely,” and similar expressions, and the negative thereof, are intended to identify forward-looking statements. There are many risks and uncertainties that could cause actual results to differ materially from our forward-looking statements. These forward-looking statements are also affected by the risk factors described in the Company’s annual report on Form 10-K for the annual period ended
Our expectations regarding our business outlook and business plans; the business plans of our customers; oil and natural gas market conditions; cost and availability of resources; economic, legal and regulatory conditions, and other matters are only our forecasts regarding these matters.
These forward-looking statements, including forecasts, may be substantially different from actual results, which are affected by many risks, along with the following risk factors and the timing of any of these risk factors:
Restructuring - Our restructuring plans may not be successful and achieve the expected result; continued deterioration of market conditions, whether due to the continued spread of COVID-19 or other events could result in further restructuring costs and impairments.
COVID-19 - The continued spread of the COVID-19 virus and the continuation of the measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter in place orders, and shutdowns, and the related uncertainties.
GE Separation - The failure to successfully eliminate dependencies on
Economic and political conditions - the impact of worldwide economic conditions; the effect that declines in credit availability may have on worldwide economic growth and demand for hydrocarbons; foreign currency exchange fluctuations and changes in the capital markets in locations where we operate; and the impact of government disruptions and sanctions.
Orders and RPO - our ability to execute on orders and RPO in accordance with agreed specifications, terms and conditions and convert those orders and RPO to revenue and cash.
Oil and gas market conditions - the level of petroleum industry exploration, development and production expenditures; the price of, volatility in pricing of, and the demand for crude oil and natural gas; drilling activity; drilling permits for and regulation of the shelf and the deepwater drilling; excess productive capacity; crude and product inventories; liquefied natural gas supply and demand; seasonal and other adverse weather conditions that affect the demand for energy; severe weather conditions, such as tornadoes and hurricanes, that affect exploration and production activities;
Terrorism and geopolitical risks - war, military action, terrorist activities or extended periods of international conflict, particularly involving any petroleum-producing or -consuming regions; labor disruptions, civil unrest or security conditions where we operate; potentially burdensome taxation, expropriation of assets by governmental action; cybersecurity risks and cyber incidents or attacks; epidemic outbreaks.
About Baker Hughes:
View source version on businesswire.com: https://www.businesswire.com/news/home/20201021005192/en/
Investor Relations
+1 281-809-9088
investor.relations@bakerhughes.com
Media Relations
+1 910-515-7873
Thomas.millas@bakerhughes.com
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