# Halliburton Co: Form 10-Q for the period ended Sep 30, 2014

- Company: [Halliburton Co](/companies/hal.md) (CIK 45012)
- Form: 10-Q
- Filed: 2014-10-24
- Accepted by EDGAR: Oct 24, 2014, 14:57 ET
- Period: 2014-09-30
- Accession: 0000045012-14-000341
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/45012/000004501214000341/hal_09302014-10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/45012/000004501214000341/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2014-09-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2014-07-01 to 2014-09-30 | $8.70bn | us-gaap:SalesRevenueNet |
| Revenue | 9 months, 2014-01-01 to 2014-09-30 | $24.10bn | us-gaap:SalesRevenueNet |
| Cost of revenue | 3 months, 2014-07-01 to 2014-09-30 | $1.70bn | us-gaap:CostOfGoodsSold |
| Cost of revenue | 9 months, 2014-01-01 to 2014-09-30 | $4.86bn | us-gaap:CostOfGoodsSold |
| Operating income | 3 months, 2014-07-01 to 2014-09-30 | $1.63bn | us-gaap:OperatingIncomeLoss |
| Operating income | 9 months, 2014-01-01 to 2014-09-30 | $3.80bn | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2014-07-01 to 2014-09-30 | $411.0m | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 9 months, 2014-01-01 to 2014-09-30 | $939.0m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2014-07-01 to 2014-09-30 | $1.20bn | us-gaap:NetIncomeLoss |
| Net income | 9 months, 2014-01-01 to 2014-09-30 | $2.60bn | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2014-07-01 to 2014-09-30 | $1.41 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 9 months, 2014-01-01 to 2014-09-30 | $3.05 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2014-07-01 to 2014-09-30 | $1.42 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 9 months, 2014-01-01 to 2014-09-30 | $3.06 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2014-07-01 to 2014-09-30 | 854,000,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 9 months, 2014-01-01 to 2014-09-30 | 853,000,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 9 months, 2014-01-01 to 2014-09-30 | $2.91bn | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 9 months, 2014-01-01 to 2014-09-30 | $2.28bn | us-gaap:PaymentsToAcquireProductiveAssets |
| Dividends paid | 9 months, 2014-01-01 to 2014-09-30 | $381.0m | us-gaap:PaymentsOfDividendsCommonStock |
| Share repurchases | 9 months, 2014-01-01 to 2014-09-30 | $800.0m | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2014-09-30 | $2.03bn | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2014-09-30 | $14.85bn | us-gaap:AssetsCurrent |
| Total assets | at 2014-09-30 | $31.58bn | us-gaap:Assets |
| Current liabilities | at 2014-09-30 | $5.89bn | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2014-09-30 | $16.07bn | us-gaap:Liabilities |
| Long-term debt | at 2014-09-30 | $7.82bn | us-gaap:LongTermDebtNoncurrent |
| Shareholders' equity | at 2014-09-30 | $15.49bn | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 54,912 characters.

### EXECUTIVE OVERVIEW

### Organization

We are a leading provider of services and products to the energy industry. We serve the upstream oil and natural gas industry 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 through the life of the field. Activity levels within our operations are significantly impacted by spending on upstream exploration, development, and production programs by major, national, and independent oil and natural gas companies. We report our results under two segments, the Completion and Production segment and the Drilling and Evaluation segment:

- our Completion and Production segment delivers cementing, stimulation, well intervention, pressure control services, well control and prevention services, pipeline and process services, specialty chemicals, artificial lift, and completion products and services. The segment consists of Production Enhancement, Cementing, Completion Tools, Boots & Coots, Multi-Chem, and Artificial Lift.
- our Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation, and precise wellbore placement solutions that enable customers to model, measure, drill, and optimize their well construction activities. The segment consists of Baroid, Sperry Drilling, Wireline and Perforating, Drill Bits and Services, Landmark Software and Services, Testing and Subsea, and Consulting and Project Management.

The business operations of our segments are organized around four primary geographic regions: North America, Latin America, Europe/Africa/CIS, and Middle East/Asia. We have significant manufacturing operations in various locations, including the United States, Canada, Malaysia, China, Singapore, and the United Kingdom.

With over 80,000 employees, we operate in approximately 80 countries around the world, and our corporate headquarters are in Houston, Texas and Dubai, United Arab Emirates.

### Financial results

Our consolidated revenue for the third quarter of 2014 was $8.7 billion, an increase of $1.2 billion, or 16%, from the third quarter of 2013, attributable to increased stimulation activity in the United States land market, as well as increased activity across all regions for fluids, cementing, logging, and well intervention control services. On a consolidated basis, all of our product service lines experienced revenue growth from the third quarter of 2013. Additionally, during the third quarter of 2014, our revenue outside of North America comprised approximately 46% of consolidated revenue and represents our ongoing strategy to grow our international business and balance our geographic mix. Operating income increased $526 million, or 47%, during the third quarter of 2014, as compared to the third quarter of 2013, primarily due to higher stimulation activity in the United States land market, increased well intervention services across all regions, and increased drilling activity in the Eastern Hemisphere. Operating income in the third quarter of 2014 was also impacted by $195 million of Macondo-related activity as a result of a reduction of our loss contingency liability and an expected insurance recovery, while operating income in the third quarter of 2013 was adversely impacted by $54 million of restructuring charges related to severance and asset write-offs.

During the first nine months of 2014, we produced revenue of $24.1 billion and operating income of $3.8 billion. Revenue increased $2.3 billion, or 11%, from the first nine months of 2013, primarily due to higher stimulation activity in the United States land market and increased activity in almost all of our product service lines in the Eastern Hemisphere, partially offset by lower activity in Latin America. Operating income increased $1.8 billion, or 90%, from the first nine months of 2013, primarily as a result of various corporate items as well as increased stimulation activity in the United States land market. Operating income in the first nine months of 2014 was impacted by $195 million of Macondo-related activity as a result of a reduction of our loss contingency liability and an expected insurance recovery. Operating income in the first nine months of 2013 was impacted by a $1.0 billion increase of our Macondo-related loss contingency, a $55 million charge related to a charitable contribution to the National Fish and Wildlife Foundation, and a $54 million restructuring charge related to severance and asset write-offs.

### Business outlook

We continue to believe in the strength of the long-term fundamentals of our business. Energy demand is expected to increase over the long term driven by economic growth in developing countries despite current underlying downside risks, such as sluggish growth in developed countries and uncertainties associated with geopolitical tensions in North Africa, Iraq, and Russia. Furthermore, development of new resources is expected to be more complex, resulting in higher service intensity.

In North America, our margins have improved during the year which we believe is due to increasing demand for our services and efficiencies in our cost structure, gained through our strategic initiatives and the application of key technologies. The industry has seen a shift from natural gas plays to oil and liquids-rich basins, as customers allocate their budgets to basins with the best economics. In addition, we are continuing to observe a meaningful switch to multi-well pad activity among our customer base, which is resulting in increased drilling and completion service efficiency. We believe the incremental efficiency gains provided by multi-well pad drilling will continue to enable us to leverage our operational scale and expertise.

Outside of North America, both revenue and operating income increased in the first nine months of 2014, compared to the first nine months of 2013. We believe that international growth will continue as a result of volume increases as we deploy resources on our recent contract wins and new projects, continued improvement in markets where we have made strategic investments, the introduction of new technology, and increased pricing and cost recovery on select contracts. We also believe that international unconventional oil and natural gas, mature fields, and deepwater projects will contribute to activity improvements over the long term, and we plan to leverage our extensive experience in North America to capitalize on these opportunities. Consistent with our long-term strategy to grow our operations outside of North America, we also expect to continue to invest in capital equipment for our international operations.

Despite the geopolitical issues we have been facing in Russia, Libya, and Iraq, Eastern Hemisphere activity continues to expand at a steady rate. In Latin America, it has been a challenging year, primarily as a result of reduced activity in Brazil and the timing of contract approvals and our recent mobilization of integrated project management work in Mexico; however, we believe activity will improve for the remainder of the year, driven by higher software and consulting services and increased integrated project activity. As such, this does not change our long-term outlook for Latin America, which we expect to contribute significantly to our future growth and profitability.

We are continuing to execute several key initiatives in 2014, which include the following strategies:

- focusing on unconventional plays, mature fields, and deepwater markets by leveraging our broad technology offerings to provide value to our customers through integrated solutions and enabling them to more efficiently drill and complete their wells;
- exploring opportunities for acquisitions that will enhance or augment our current portfolio of services and products, including those with unique technologies or distribution networks in areas where we do not already have significant operations;
- making key investments in technology and infrastructure to maximize growth opportunities. To that end, we are continuing to migrate our technology and manufacturing capacity, as well as our supply chain, closer to our customers in the Eastern Hemisphere;
- improving working capital, and managing our balance sheet to maximize our financial flexibility. We are working to improve service delivery through a project that we expect will result in, among other things, significant improvements to our current order-to-cash and purchase-to-pay processes;
- growing our international revenues and margins by directing capital and resources into strategic growth markets;
- improving our North America margins by leveraging technologies and reducing costs through more efficient operations; and
- continuing to seek ways to be one of the most cost efficient service providers in the industry by maintaining capital discipline and leveraging our scale and breadth of operations.

Our operating performance and business outlook are described in more detail in “Business Environment and Results of Operations.”

### Financial markets, liquidity, and capital resources

We believe we have invested our cash balances conservatively and secured sufficient financing to help mitigate any near-term negative impact on our operations from adverse market conditions. For additional information, see “Liquidity and Capital Resources” and “Business Environment and Results of Operations.”

### LIQUIDITY AND CAPITAL RESOURCES

We ended the third quarter of 2014 with cash and equivalents of $2.0 billion, compared to $2.4 billion at the end of 2013. As of September 30, 2014, approximately $107 million of the $2.0 billion of cash and equivalents was held by our foreign subsidiaries and would be subject to United States tax if repatriated. However, our intent is to permanently reinvest these funds outside of the United States and our current plans do not suggest a need to repatriate them to fund our United States operations. At September 30, 2014, we also held $280 million of investments in fixed income securities compared to $373 million at December 31, 2013. These securities are reflected in "Other current assets" and "Other assets" in our condensed consolidated balance sheets.

### Significant sources and uses of cash

Cash flows from operating activities were $2.9 billion in the first nine months of 2014.

Capital expenditures were $2.3 billion in the first nine months of 2014, and were predominantly made in our Production Enhancement, Sperry Drilling, Cementing, Wireline and Perforating, and Baroid product service lines.

During the first nine months of 2014, our primary components of working capital (receivables, inventories, and accounts payable) increased by a net $1.0 billion, primarily due to increased business activity.

We repurchased approximately 13.3 million shares of our common stock during the first nine months of 2014 for a total cost of $800 million.

We paid $381 million in dividends to our shareholders during the first nine months of 2014.

During the first nine months of 2014, we paid $230 million for acquisitions of various businesses, net of cash acquired, to further enhance our existing product service lines.

During the first quarter of 2014, we received a $155 million income tax refund, including interest, for agreed upon tax items for the tax years 2003 through 2006 and 2008 through 2009.

### Future sources and uses of cash

During the third quarter of 2014, we reached an agreement, subject to court approval, to settle a substantial portion of the plaintiffs' claims asserted against us relating to the Macondo well incident for approximately $1.1 billion, of which approximately $395 million would be paid over the next year. See Note 6 to the condensed consolidated financial statements for further information.

During the third quarter of 2014, we reached a settlement with KBR under which KBR agreed to pay us $81 million related to amounts owed to us under our Tax Sharing Agreement with KBR. See Note 5 to the condensed consolidated financial statements for further information.

Capital spending for 2014 is currently expected to be approximately $3.2 billion. The capital expenditures plan for the fourth quarter of 2014 is primarily directed toward our Production Enhancement, Sperry Drilling, Boots & Coots, Wireline and Perforating, and Cementing product service lines, with an increasing amount dedicated to our operations in North America.

Subject to Board of Directors approval, our intention is to pay dividends representing at least 15% to 20% of our net income on an annual basis. In October 2014, Halliburton’s Board of Directors approved a 20% increase of the quarterly dividend from $0.15 to $0.18 per share, or approximately $152 million per quarter, which is expected to be paid in the fourth quarter of 2014.

In July 2014, our Board of Directors increased the authorization to repurchase our common stock by approximately $4.8 billion. Approximately $5.7 billion remains authorized for repurchases as of September 30, 2014 and may be used for open market and other share purchases.

We are continuing to explore opportunities for acquisitions that will enhance or augment our current portfolio of services and products, including those with unique technologies or distribution networks in areas where we do not already have significant operations.

### Other factors affecting liquidity

*Financial position in current market.* As of September 30, 2014, we had $2.0 billion of cash and equivalents, $280 million in fixed income investments, and a total of $3.0 billion of available committed bank credit under our revolving credit facility. Furthermore, we have no financial covenants or material adverse change provisions in our bank agreements, and our debt maturities extend over a long period of time. Although a portion of earnings from our foreign subsidiaries is reinvested outside the United States indefinitely, we do not consider this to have a significant impact on our liquidity. We currently believe that our capital expenditures, working capital investments, and dividends, if any, during the remainder of 2014 can be fully funded through cash from operations.

As a result, we believe we have a reasonable amount of liquidity and, if necessary, additional financing flexibility given the current market environment to fund our potential contingent liabilities, if any. However, as discussed in Note 6 to the

condensed consolidated financial statements, there are future developments that may arise as a result of the Macondo well incident that could have a material adverse effect on our liquidity.

*Guarantee agreements.* In the normal course of business, we have agreements with financial institutions under which approximately $2.4 billion of letters of credit, bank guarantees, or surety bonds were outstanding as of September 30, 2014. Some of the outstanding letters of credit have triggering events that would entitle a bank to require cash collateralization.

*Credit ratings.* Credit ratings for our long-term debt remain A2 with Moody’s Investors Service and A with Standard & Poor’s. The credit ratings on our short-term debt remain P-1 with Moody’s Investors Service and A-1 with Standard & Poor’s.

*Customer receivables*. In line with industry practice, we bill our customers for our services in arrears and are, therefore, subject to our customers delaying or failing to pay our invoices. In weak economic environments, we may experience increased delays and failures to pay our invoices due to, among other reasons, a reduction in our customers’ cash flow from operations and their access to the credit markets as well as unsettled political conditions. If our customers delay paying or fail to pay us a significant amount of our outstanding receivables, it could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition. See “Business Environment and Results of Operations – International operations – Venezuela” for further discussion related to Venezuela.

### BUSINESS ENVIRONMENT AND RESULTS OF OPERATIONS

We operate in approximately 80 countries throughout the world to provide a comprehensive range of discrete and integrated services and products to the energy industry related to the exploration, development, and production of oil and natural gas. A significant amount of our consolidated revenue is derived from the sale of services and products to major, national, and independent oil and natural gas companies worldwide. The industry we serve is highly competitive with many substantial competitors in each segment of our business. During the first nine months of 2014, based upon the location of the services provided and products sold, 51% of our consolidated revenue was from the United States, compared to 49% of consolidated revenue from the United States in the first nine months of 2013. No other country accounted for more than 10% of our revenue during these periods.

Operations in some countries may be adversely affected by unsettled political conditions, acts of terrorism, civil unrest, force majeure, war or other armed conflict, sanctions, expropriation or other governmental actions, inflation, foreign currency exchange restrictions, and highly inflationary currencies, as well as other geopolitical factors. We believe the geographic diversification of our business activities reduces the risk that loss of operations in any one country, other than the United States, would be materially adverse to our consolidated results of operations.

Activity within our business segments is significantly impacted by spending on upstream exploration, development, and production programs by our customers. Also impacting our activity is the status of the global economy, which impacts oil and natural gas consumption.

Some of the more significant determinants of current and future spending levels of our customers are oil and natural gas prices, the world economy, the availability of credit, government regulation, and global stability, which together drive worldwide drilling activity. Our financial performance is significantly affected by oil and natural gas prices and worldwide rig activity, which are summarized in the following tables. Additionally, due to improved drilling and completion efficiencies as

more of our customers move to multi-well pad drilling, our financial performance is impacted by well count in the North America market.

The following table shows the average oil and natural gas prices for West Texas Intermediate (WTI), United Kingdom Brent crude oil, and Henry Hub natural gas:

|  | Three Months Ended September 30 2014 | 2013 | Year Ended December 31 2013 |
| --- | ---: | ---: | ---: |
| Oil price - WTI (1) | $97.78 | $104.74 | $97.99 |
| Oil price - Brent (1) | 101.82 | 109.28 | 108.71 |
| Natural gas price - Henry Hub (2) | 3.96 | 3.56 | 3.73 |
| (1) Oil price measured in dollars per barrel (2) Natural gas price measured in dollars per million British thermal units (Btu), or MMBtu |  |  |  |

20

The historical average rig counts based on the weekly Baker Hughes Incorporated rig count information were as follows:

| Land vs. Offshore United States: | Three Months Ended September 30 2014 2013 | Nine Months Ended September 30 2014 2013 |
| --- | ---: | ---: |
| Land | 1,842 1,708 | 1,788 1,708 |
| Offshore (incl. Gulf of Mexico) | 61 61 | 57 55 |
| Total | 1,903 1,769 | 1,845 1,763 |
| Canada: |  |  |
| Land | 382 345 | 369 344 |
| Offshore | 3 4 | 2 2 |
| Total | 385 349 | 371 346 |
| International (excluding Canada): |  |  |
| Land | 1,020 971 | 1,021 969 |
| Offshore | 328 314 | 324 320 |
| Total | 1,348 1,285 | 1,345 1,289 |
| Worldwide total | 3,636 3,403 | 3,561 3,398 |
| Land total | 3,244 3,024 | 3,178 3,021 |
| Offshore total | 392 379 | 383 377 |
|  | Three Months Ended September 30 | Nine Months Ended September 30 |
| **Oil vs. Natural Gas** | 2014 2013 | 2014 2013 |
| United States (incl. Gulf of Mexico): |  |  |
| Oil | 1,578 1,386 | 1,514 1,372 |
| Natural gas | 325 383 | 331 391 |
| Total | 1,903 1,769 | 1,845 1,763 |
| Canada: |  |  |
| Oil | 220 225 | 220 240 |
| Natural gas | 165 124 | 151 106 |
| Total | 385 349 | 371 346 |
| International (excluding Canada): |  |  |
| Oil | 1,074 1,015 | 1,074 1,021 |
| Natural gas | 274 270 | 271 268 |
| Total | 1,348 1,285 | 1,345 1,289 |
| Worldwide total | 3,636 3,403 | 3,561 3,398 |
| Oil total | 2,872 2,626 | 2,808 2,633 |
| Natural gas total | 764 777 | 753 765 |

| Drilling Type United States (incl. Gulf of Mexico): | Three Months Ended September 30 2014 | 2013 | Nine Months Ended September 30 2014 | 2013 |
| --- | ---: | ---: | ---: | ---: |
| Horizontal | 1,314 | 1,073 | 1,247 | 1,096 |
| Vertical | 372 | 435 | 384 | 444 |
| Directional | 217 | 261 | 214 | 223 |
| Total | 1,903 | 1,769 | 1,845 | 1,763 |

21

Our customers’ cash flows, in most instances, depend upon the revenue they generate from the sale of oil and natural gas. Lower oil and natural gas prices usually translate into lower exploration and production budgets, while the opposite is true for higher oil and natural gas prices.

WTI oil spot prices fluctuated throughout the first nine months of 2013 between a low of $87 per barrel and a high of $111 per barrel, while Brent crude oil spot prices fluctuated between a low of $97 per barrel and a high of $119 per barrel during this same period. During the first nine months of 2014, WTI oil spot prices ranged between $91 per barrel and $108 per barrel, while Brent crude oil spot prices ranged between $95 per barrel and $115 per barrel. Spot crude oil prices during the current year were negatively affected by rising exports from Libya and Iraq, softening demand in Europe and Asia, and robust production in the United States that has cut the demand for West African barrels. Despite the recent production increase in Libya, the country still faces a considerable challenge in ramping up production to its full capacity or even sustaining it at the current level. Additionally, high refinery runs contributed in a reduction to the differential between WTI and Brent crude oil spot prices, which has narrowed from an average of $8 per barrel during the first half of 2014 to $4 per barrel in the third quarter.

According to the International Energy Agency's (IEA) October 2014 "Oil Market Report," 2014 global oil demand is expected to average approximately 92.4 million barrels per day, which is up 1% from 2013. Although the latest European, Chinese, and Russia economic conditions have caused some alarm, the IEA still forecasts overall demand momentum to accelerate modestly over the remainder of 2014.

During the first nine months of 2014, average Henry Hub natural gas prices in the United States increased approximately 24% compared to the first nine months of 2013, due to an increase in natural gas storage withdrawals related to an unseasonably harsh winter in the early part of 2014. Higher natural gas prices this year contributed to a decline in natural gas consumption in the power sector, and the United States Energy Information Administration October 2014 "Short Term Energy Outlook" forecasts natural gas spot prices will remain near current levels until the start of the next winter heating season, with natural gas consumption in the power sector to increase next year.

### North America operations

Volatility in oil and natural gas prices can impact our customers’ drilling and production activities, particularly in North America. For the first nine months of 2014, the average natural gas directed rig count fell by 15 rigs, or 3%, while the average oil directed rig count increased 8%, compared to the first nine months of 2013. In the first nine months of 2014 our North America revenue and operating income increased 14% and 19%, respectively, compared to the first nine months of 2013.

Service intensity levels have continued to expand, and rising completion volumes have resulted in the need to expand our infrastructure.

In the United States land market, there was a moderate increase in rig count over the past year, driven by an increase in horizontal rigs primarily in the Permian Basin. We see service intensity expanding across many basins which is evidenced by longer laterals, increased stage counts, and rising volumes per stage. This trend is beneficial to our overall business and should enable us to leverage our broad technology offerings.

In the Gulf of Mexico, our deepwater activity outlook remains positive as we continue to focus on leveraging our technology to increase reliability and reduce uncertainty. Over the long term, the continued growth in the Gulf of Mexico is dependent on, among other things, governmental approvals for permits, our customers' actions, and new deepwater rigs entering the market.

### International operations

The industry experienced steady volume increases in the first nine months of 2014, with average international rig count improving by 4%, compared to the first nine months of 2013. In the Eastern Hemisphere, we continue to execute our growth strategy. Relative to the first nine months of 2013, we grew our Eastern Hemisphere revenue and operating income by 11% and 18%, respectively, as a result of growth in both the Middle East/Asia and Europe/Africa/CIS regions. We had strong growth in our Saudi Arabia operations due to increased activity in most of our product service lines. Our Eastern Hemisphere activity is expanding at a steady rate and we expect the fourth quarter of 2014 to be our strongest quarter of the year, due to seasonal year-end software and equipment sales.

In Latin America, although it has been a challenging year, activity has improved during the third quarter of 2014. Over the long term, we are optimistic about our position in Latin America and the future growth potential of this market. With the passage of energy reform in Mexico, we expect to see a strong opportunity for growth in Mexico’s shale, mature fields, and deepwater markets in future years. We believe foreign investment in this market will be beneficial to our business.

*Venezuela.* As of September 30, 2014, our total net investment in Venezuela was approximately $554 million, including net monetary assets of $146 million denominated in Bolívares. Also, at September 30, 2014 we had $258 million of surety bond guarantees outstanding relating to our Venezuelan operations.

We have experienced delays in collecting payment on our receivables from our primary customer in Venezuela. These receivables are not disputed, and we have not historically had material write-offs relating to this customer. Additionally, we routinely monitor the financial stability of our customers. Our total outstanding trade receivables in Venezuela were $653 million, or approximately 9% of our gross trade receivables, as of September 30, 2014, compared to $486 million, or approximately 8% of our gross trade receivables, as of December 31, 2013. Of the $653 million receivables in Venezuela as of September 30, 2014, $215 million has been classified as long-term and included within “Other assets” on our condensed consolidated balance sheets.

In February 2013, the Venezuelan government devalued the Bolívar, from the preexisting exchange rate of 4.3 Bolívares per United States dollar to 6.3 Bolívares per United States dollar.

During 2014, the Venezuelan government has made available two new foreign exchange rate mechanisms through which a company may be able to legally convert Bolívares to United States dollars, in addition to the National Center of Foreign Commerce official rate of 6.3 Bolívares per United States dollar:

(1) a bid rate established via weekly auctions under the Complementary System of Foreign Currency Acquirement (SICAD I); and

(2) an auction rate which is intended to more closely resemble a market-driven exchange rate (SICAD II).

The availability of new currency mechanisms had no impact on our results of operations during the nine months ended September 30, 2014 as we continue to use the official exchange rate to remeasure net assets denominated in Bolívares. We have not utilized nor do we intend at this time to utilize either of the newly available exchange mechanisms to transact business in Venezuela. Had we used the SICAD I rate of 12.0 Bolívares per United States dollar or the SICAD II rate of 50.0 Bolívares per United States dollar to remeasure our net monetary position as of September 30, 2014, we would have incurred a foreign currency loss ranging from $69 million to $128 million for the third quarter of 2014. We will continue to monitor any future impact of these mechanisms on the exchange rate we use to remeasure our Venezuelan subsidiary’s financial statements.

For additional information, see Part I, Item 1(a), “Risk Factors” in our 2013 Annual Report on Form 10-K.

### RESULTS OF OPERATIONS IN 2014 COMPARED TO 2013

### Three Months Ended September 30, 2014 Compared with Three Months Ended September 30, 2013

| REVENUE: Millions of dollars | Three Months Ended September 30 2014 | 2013 | Favorable (Unfavorable) | Percentage Change |
| --- | ---: | ---: | ---: | ---: |
| Completion and Production | $5,420 | $4,501 | $919 | 20% |
| Drilling and Evaluation | 3,281 | 2,971 | 310 | 10 |
| Total revenue | $8,701 | $7,472 | $1,229 | 16% |
| By geographic region: |  |  |  |  |
| Completion and Production: |  |  |  |  |
| North America | $3,705 | $2,925 | $780 | 27% |
| Latin America | 435 | 412 | 23 | 6 |
| Europe/Africa/CIS | 699 | 636 | 63 | 10 |
| Middle East/Asia | 581 | 528 | 53 | 10 |
| Total | 5,420 | 4,501 | 919 | 20 |
| Drilling and Evaluation: |  |  |  |  |
| North America | 1,019 | 956 | 63 | 7 |
| Latin America | 610 | 590 | 20 | 3 |
| Europe/Africa/CIS | 765 | 704 | 61 | 9 |
| Middle East/Asia | 887 | 721 | 166 | 23 |
| Total | 3,281 | 2,971 | 310 | 10 |
| Total revenue by region: |  |  |  |  |
| North America | 4,724 | 3,881 | 843 | 22 |
| Latin America | 1,045 | 1,002 | 43 | 4 |
| Europe/Africa/CIS | 1,464 | 1,340 | 124 | 9 |
| Middle East/Asia | 1,468 | 1,249 | 219 | 18 |

24

| OPERATING INCOME: Millions of dollars | Three Months Ended September 30 2014 | 2013 | Favorable (Unfavorable) | Percentage Change |
| --- | ---: | ---: | ---: | ---: |
| Completion and Production | $1,071 | $763 | $308 | 40% |
| Drilling and Evaluation | 451 | 450 | 1 | — |
| Corporate and other | 112 | (105) | 217 | 207 |
| Total operating income | $1,634 | $1,108 | $526 | 47% |
| By geographic region: |  |  |  |  |
| Completion and Production: |  |  |  |  |
| North America | $765 | $489 | $276 | 56% |
| Latin America | 65 | 63 | 2 | 3 |
| Europe/Africa/CIS | 126 | 119 | 7 | 6 |
| Middle East/Asia | 115 | 92 | 23 | 25 |
| Total | 1,071 | 763 | 308 | 40 |
| Drilling and Evaluation: |  |  |  |  |
| North America | 141 | 168 | (27) | (16) |
| Latin America | 73 | 92 | (19) | (21) |
| Europe/Africa/CIS | 90 | 82 | 8 | 10 |
| Middle East/Asia | 147 | 108 | 39 | 36 |
| Total | 451 | 450 | 1 | — |
| Total operating income by region |  |  |  |  |
| (excluding Corporate and other): |  |  |  |  |
| North America | 906 | 657 | 249 | 38 |
| Latin America | 138 | 155 | (17) | (11) |
| Europe/Africa/CIS | 216 | 201 | 15 | 7 |
| Middle East/Asia | 262 | 200 | 62 | 31 |

The 16% increase in consolidated revenue in the third quarter of 2014, as compared to the third quarter of 2013, was primarily attributable to increased stimulation activity in the United States land market and higher activity across the majority of our product service lines in the Eastern Hemisphere. On a consolidated basis, all of our product service lines experienced revenue growth from the third quarter of 2013. Revenue outside of North America was 46% of consolidated revenue in the third quarter of 2014, compared to 48% of consolidated revenue in the third quarter of 2013.

The increase of $526 million, or 47%, in consolidated operating income during the third quarter of 2014, as compared to the third quarter of 2013, was primarily due to higher stimulation activity in the United States land market, increased well intervention services across all regions, and increased drilling activity in the Eastern Hemisphere. Operating income in the third quarter of 2014 was also impacted by $195 million of Macondo-related activity as a result of a reduction of our loss contingency liability and an expected insurance recovery, while operating income in the third quarter of 2013 was adversely impacted by $54 million of restructuring charges related to severance and asset write-offs.

*Completion and Production* revenue in the third quarter of 2014 increased 20% as compared to the third quarter of 2013, primarily due to increased activity in North America, as well as higher cementing and well intervention services across all international regions. North America revenue rose 27%, driven by higher stimulation activity in the United States land market and strong growth across all product service lines. Latin America revenue increased 6%, primarily due to higher activity across all product service lines in Venezuela, which more than offset lower stimulation activity in Mexico. Europe/Africa/CIS revenue increased 10%, driven by higher activity across the majority of our product service lines in the United Kingdom, Angola, and Nigeria, along with higher stimulation activity and well intervention services in the Netherlands, which were partially offset by a decrease in pressure pumping activity in Norway. Middle East/Asia revenue grew 10%, mainly due to increased completion tools sales and pressure pumping activity in Saudi Arabia and higher well intervention services in Indonesia. Revenue outside of North America was 32% of total segment revenue in the third quarter of 2014, compared to 35% of total segment revenue in the third quarter of 2013.

Completion and Production operating income increased 40% in the third quarter of 2014, as compared to the third quarter of 2013, primarily due to stronger stimulation activity and improved cost efficiencies in the United States land market, as well as increased well intervention services across all regions. North America operating income improved 56% due to increased stimulation activity, modest pricing improvements, and improved cost efficiencies in the United States land market. Latin America operating income was 3% higher compared to the third quarter of 2013 as a result of increased profitability on well intervention services in Venezuela and Mexico, which was partially offset by decreased completion tools sales in Brazil and Trinidad. Europe/Africa/CIS operating income increased 6%, primarily due to increased activity and profitability across the majority of our product service lines in the United Kingdom and Angola, which were partially offset by reduced cementing activity in Norway and Mozambique. Middle East/Asia operating income rose 25%, mainly due to higher pressure pumping activity and completion tools sales in Saudi Arabia.

*Drilling and Evaluation* revenue increased 10% in the third quarter of 2014, as compared to the third quarter of 2013, primarily driven by higher fluid activity across all regions and increased drilling and consulting activity in the Eastern Hemisphere. North America revenue increased 7% compared to the third quarter of 2013 due to increased drilling and fluid activity in the United States land market and the Gulf of Mexico. Latin America revenue increased 3%, primarily due to increased activity in all of our product service lines in Venezuela and higher drilling and fluid activity in Argentina, which were partially offset by a decline in activity across the majority of our product service lines in Mexico and Ecuador. Europe/Africa/CIS revenue increased 9% as a result of higher drilling and fluid activity in the United Kingdom, Russia and the Netherlands, along with increased activity across all product service lines in Nigeria. Middle East/Asia revenue grew 23%, mainly due to higher activity in most of our product service lines in Saudi Arabia, higher drilling activity in Thailand, and increased consulting, wireline, and fluid services in India. Revenue outside of North America was 69% of total segment revenue in the third quarter of 2014, compared to 68% of total segment revenue in the third quarter of 2013.

Drilling and Evaluation operating income was essentially flat in the third quarter of 2014 compared to the third quarter of 2013, as increased drilling and fluid activity in the Eastern Hemisphere were offset by decreased drilling and fluid activity in the United States land market and Latin America. North America operating income decreased 16%, due to reduced activity across most of our product service lines. Latin America operating income decreased 21%, primarily due to lower activity across most of our product service lines in Mexico, which was partially offset by increased activity across most product service lines in Brazil and higher logging activity in Venezuela. Europe/Africa/CIS operating income grew 10% as a result of increased activity for all of our product service lines in the United Kingdom and Nigeria, along with increased drilling activity in Azerbaijan, which were partially offset by reduced drilling and logging activity in Angola. Middle East/Asia operating income rose 36%, driven by higher drilling and fluid activity in Saudi Arabia, as well as increased drilling and logging activity in Thailand.

*Corporate and other* was $112 million of income in the third quarter of 2014, compared to $105 million of expenses in the third quarter of 2013, primarily due to $195 million of activity related to the Macondo well incident recorded in the third quarter of 2014 as a result of a reduction of our loss contingency liability and an expected insurance recovery. See Note 6 to the condensed consolidated financial statements for further information.

### NONOPERATING ITEMS

*Other, net* was $12 million of income for the quarter ended September 30, 2014, compared to $12 million of expenses for the quarter ended September 30, 2013. This $24 million increase was primarily impacted by currency exchange instruments designed to mitigate foreign currency risks.

*Effective tax rate*. Our effective tax rate on continuing operations was 26.5% for the quarter ended September 30, 2014 and 29.5% for the quarter ended September 30, 2013. The effective tax rate for the quarter ended September 30, 2014 was positively impacted by a $201 million net operating loss valuation allowance released as a result of a reorganization of our legal entity structure in Brazil, as well as lower tax rates in certain foreign jurisdictions. Partially offsetting these items were tax expenses related to Macondo activity recorded during the third quarter of 2014, which was tax-effected at the United States statutory rate, as well as approximately $100 million for a write-off of certain prepaid tax assets recorded in Iraq and additional tax expenses related to the settlement of a research and development credit with the United States tax authorities. The effective tax rate for quarter ended September 30, 2013 was also positively impacted by lower tax rates in certain foreign jurisdictions.

*Income (loss) from discontinued operations, net* includes $63 million of income for the three months ended September 30, 2014 related to a settlement we reached with KBR for amounts owed to us under our Tax Sharing Agreement with KBR. See Note 5 to the condensed consolidated financial statements for further information.

### Nine Months Ended September 30, 2014 Compared with Nine Months Ended September 30, 2013

| REVENUE: Millions of dollars | Nine Months Ended September 30 2014 | 2013 | Favorable (Unfavorable) | Percentage Change |
| --- | ---: | ---: | ---: | ---: |
| Completion and Production | $14,782 | $12,964 | $1,818 | 14% |
| Drilling and Evaluation | 9,318 | 8,799 | 519 | 6 |
| Total revenue | $24,100 | $21,763 | $2,337 | 11% |
| By geographic region: |  |  |  |  |
| Completion and Production: |  |  |  |  |
| North America | $9,957 | $8,546 | $1,411 | 17% |
| Latin America | 1,185 | 1,158 | 27 | 2 |
| Europe/Africa/CIS | 1,940 | 1,744 | 196 | 11 |
| Middle East/Asia | 1,700 | 1,516 | 184 | 12 |
| Total | 14,782 | 12,964 | 1,818 | 14 |
| Drilling and Evaluation: |  |  |  |  |
| North America | 3,012 | 2,843 | 169 | 6 |
| Latin America | 1,616 | 1,733 | (117) | (7) |
| Europe/Africa/CIS | 2,204 | 2,082 | 122 | 6 |
| Middle East/Asia | 2,486 | 2,141 | 345 | 16 |
| Total | 9,318 | 8,799 | 519 | 6 |
| Total revenue by region: |  |  |  |  |
| North America | 12,969 | 11,389 | 1,580 | 14 |
| Latin America | 2,801 | 2,891 | (90) | (3) |
| Europe/Africa/CIS | 4,144 | 3,826 | 318 | 8 |
| Middle East/Asia | 4,186 | 3,657 | 529 | 14 |

27

| OPERATING INCOME: Millions of dollars | Nine Months Ended September 30 2014 | 2013 | Favorable (Unfavorable) | Percentage Change |
| --- | ---: | ---: | ---: | ---: |
| Completion and Production | $2,619 | $2,110 | $509 | 24% |
| Drilling and Evaluation | 1,263 | 1,272 | (9) | (1) |
| Corporate and other | (84) | (1,388) | 1,304 | (94) |
| Total operating income | $3,798 | $1,994 | $1,804 | 90% |
| By geographic region: |  |  |  |  |
| Completion and Production: |  |  |  |  |
| North America | $1,841 | $1,438 | $403 | 28% |
| Latin America | 161 | 139 | 22 | 16 |
| Europe/Africa/CIS | 300 | 257 | 43 | 17 |
| Middle East/Asia | 317 | 276 | 41 | 15 |
| Total | 2,619 | 2,110 | 509 | 24 |
| Drilling and Evaluation: |  |  |  |  |
| North America | 457 | 490 | (33) | (7) |
| Latin America | 138 | 226 | (88) | (39) |
| Europe/Africa/CIS | 248 | 226 | 22 | 10 |
| Middle East/Asia | 420 | 330 | 90 | 27 |
| Total | 1,263 | 1,272 | (9) | (1) |
| Total operating income by region |  |  |  |  |
| (excluding Corporate and other): |  |  |  |  |
| North America | 2,298 | 1,928 | 370 | 19 |
| Latin America | 299 | 365 | (66) | (18) |
| Europe/Africa/CIS | 548 | 483 | 65 | 13 |
| Middle East/Asia | 737 | 606 | 131 | 22 |

Consolidated revenue in the first nine months of 2014 increased 11%, as compared to the first nine months of 2013, primarily as a result of higher stimulation activity in the United States land market and increased activity in almost all of our product service lines in the Eastern Hemisphere, which were partially offset by lower activity in Latin America. Revenue outside of North America was 46% of consolidated revenue in the first nine months of 2014, compared to 48% of consolidated revenue in the first nine months of 2013.

The increase of $1.8 billion, or 90%, in consolidated operating income in the first nine months of 2014, as compared to the first nine months of 2013, was primarily as a result of various corporate items as well as increased stimulation activity in the United States land market and growth in the Eastern Hemisphere, which more than offset lower activity and margins experienced in Latin America. Operating income in the first nine months of 2014 was impacted by $195 million of Macondo-related activity as a result of a reduction of our loss contingency liability and an expected insurance recovery. Operating income in the first nine months of 2013 was impacted by a $1.0 billion increase of our Macondo-related loss contingency, a $55 million charge related to a charitable contribution to the National Fish and Wildlife Foundation, and a $54 million restructuring charge related to severance and asset write-offs.

*Completion and Production* revenue increased 14% from the first nine months of 2013, with activity increases across all regions and predominately in North America due to higher stimulation activity in the United States land market. North America revenue rose by 17% as a result of increased stimulation activity in the United States land market. Latin America revenue was essentially flat, as increased activity levels in the majority of our product service lines in Venezuela and Argentina were partially offset by a decrease in stimulation activity in Mexico and lower pressure pumping activity in Brazil. Europe/Africa/CIS revenue improved by 11%, driven by higher completion tools sales in Angola, Nigeria and the United Kingdom, and increased cementing activity in Angola, which were partially offset by reduced pressure pumping activity in Norway. Middle East/Asia revenue grew 12%, primarily due to increased activity in the majority of our product service lines in Saudi Arabia, higher cementing activity in Thailand, and increased pressure pumping activity in Australia, which more than offset reduced activity levels in Oman and a decline in completion tools sales in Malaysia. Revenue outside of North America was 33% of total segment revenue in the first nine months of 2014, compared to 34% of total segment revenue in the first nine months of 2013.

Completion and Production operating income improved by 24% from the first nine months of 2013 as a result of increased profitability across all regions. North America operating income increased 28% as a result of increased profitability for stimulation activity in the United States land market, which more than offset reductions in cementing services in that market. Latin America operating income grew 16%, primarily due to improved pressure pumping activity in Argentina and higher profitability for well intervention and cementing services in Mexico, which were partially offset by reduced completion tools sales in Mexico and Brazil. Europe/Africa/CIS operating income improved 17% as a result of improved cementing activity in Angola, as well as higher completion tools sales in Angola and the United Kingdom. Middle East/Asia operating income rose by 15%, primarily due to increased profitability for the majority of our product services lines in Saudi Arabia, which was partially offset by reduced activity levels in Oman.

*Drilling and Evaluation* revenue increased 6% from the first nine months of 2013, primarily due to a strong performance in the Eastern Hemisphere, which was partially offset by a decrease in drilling activity and consulting services in Latin America. North America revenue rose by 6%, due to increased fluid activity in the United States land market and higher activity in the majority of our product service lines in the Gulf of Mexico. Latin America revenue decreased 7%, primarily due to a decline in drilling activity in Brazil and activity reductions in Mexico for the majority of our product services lines. These decreases were partially offset by higher activity levels in most of our product service lines in Venezuela and Argentina. Europe/Africa/CIS revenue improved by 6% as a result of an increase in drilling and fluid activity in the United Kingdom, Angola, and Russia, and an increase in fluid activity in the Netherlands, which were partially offset by reduced fluid activity in Norway and Egypt. Middle East/Asia revenue increased 16% as a result of increased activity in all of our product services lines in Saudi Arabia and increased demand for drilling activity in Thailand and fluid activity in Malaysia. Revenue outside of North America was 68% of total segment revenue in the first nine months of both 2014 and 2013.

Drilling and Evaluation operating income was essentially flat from the first nine months of 2013, as lower drilling activity and margins in Latin America were offset by strong growth in the Eastern Hemisphere. North America operating income decreased 7% due to a decline in drilling services in Canada and the United States land market. Latin America operating income declined by 39%, mainly due to reduced activity levels in Mexico and lower drilling activity and pricing in Brazil, which were partially offset by improved activity levels in Argentina. Europe/Africa/CIS operating income rose by 10%, as a result of increased drilling activity in the United Kingdom and Angola, improved profitability for drilling services in Norway, and increased activity levels in Tanzania. Middle East/Asia operating income increased 27%, primarily due to an increase in demand and profitability for drilling activity in Saudi Arabia, as well as improved drilling services in Thailand, which were partially offset by reduced drilling services and logging activity in China.

*Corporate and other* expenses were $84 million in the first nine months of 2014 compared to $1.4 billion in the first nine months of 2013. The significant decrease was primarily due to $195 million of activity related to the Macondo well incident recorded in the first nine months of 2014 as a result of a reduction of our loss contingency liability and an expected insurance recovery, compared to a $1.0 billion increase of our Macondo-related loss contingency and a $55 million charge related to a charitable contribution to the National Fish and Wildlife Foundation recorded in the first nine months of 2013. See Note 6 to the condensed consolidated financial statements for further information.

### NONOPERATING ITEMS

*Interest expense, net of interest income* increased $50 million in the first nine months of 2014, as compared to the first nine months of 2013, primarily due to higher interest expense as a result of the issuance of $3.0 billion aggregate principal amount of senior notes in August 2013.

*Effective tax rate*. Our effective tax rate was 27.0% for the nine months ended September 30, 2014 and 22.0% for the nine months ended September 30, 2013. The effective tax rate for the nine months ended September 30, 2014 was positively impacted by a $201 million net operating loss valuation allowance released as a result of a reorganization of our legal entity structure in Brazil, as well as lower tax rates in certain foreign jurisdictions. Partially offsetting these items were tax expenses related to Macondo activity recorded during the third quarter of 2014, which was tax-effected at the United States statutory rate, as well as approximately $100 million for a write-off of certain prepaid tax assets recorded in Iraq and additional tax expenses related to the settlement of a research and development credit with the United States tax authorities. Our effective tax rate for the nine months ended September 30, 2013 was also positively impacted by lower tax rates in certain foreign jurisdictions; federal tax benefits of approximately $50 million due to the reinstatement of certain tax benefits and credits related to the first quarter of 2013 enactment of the American Taxpayer Relief Act of 2012; and the tax impact related to an increase of our Macondo-related loss contingency recorded during the first quarter of 2013, which was tax-effected at the United States statutory rate.

*Income (loss) from discontinued operations, net* includes $63 million of income for the nine months ended September 30, 2014 related to a settlement we reached with KBR for amounts owed to us under our Tax Sharing Agreement with KBR. See Note 5 to the condensed consolidated financial statements for further information.

### ENVIRONMENTAL MATTERS

We are subject to numerous environmental, legal, and regulatory requirements related to our operations worldwide. For information related to environmental matters, see Note 6 to the condensed consolidated financial statements.

### NEW ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) issued a comprehensive new revenue recognition standard that will supersede existing revenue recognition guidance under United States generally accepted accounting principles (U.S. GAAP) and International Financial Reporting Standards (IFRS). The issuance of this guidance completes the joint effort by the FASB and the IASB to improve financial reporting by creating common revenue recognition guidance for U.S. GAAP and IFRS.

The core principle of the new guidance is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The standard creates a five-step model that requires companies to exercise judgment when considering the terms of a contract and all relevant facts and circumstances. The standard allows for several transition methods: (a) a full retrospective adoption in which the standard is applied to all of the periods presented, or (b) a modified retrospective adoption in which the standard is applied only to the most current period presented in the financial statements, including additional disclosures of the standard’s application impact to individual financial statement line items.

This standard is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. We are currently evaluating this standard and our existing revenue recognition policies to determine which contracts in the scope of the guidance will be affected by the new requirements and what impact they would have on our consolidated financial statements upon adoption of this standard. We have not yet determined which transition method we will utilize upon adoption.

### FORWARD-LOOKING INFORMATION

The Private Securities Litigation Reform Act of 1995 provides safe harbor provisions for forward-looking information. Forward-looking information is based on projections and estimates, not historical information. Some statements in this Form 10-Q are forward-looking and use words like “may,” “may not,” “believe,” “do not believe,” “plan,” “estimate,” “intend,” “expect,” “do not expect,” “anticipate,” “do not anticipate,” “should,” “likely,” and other expressions. We may also provide oral or written forward-looking information in other materials we release to the public. Forward-looking information involves risk and uncertainties and reflects our best judgment based on current information. Our results of operations can be affected by inaccurate assumptions we make or by known or unknown risks and uncertainties. In addition, other factors may affect the accuracy of our forward-looking information. As a result, no forward-looking information can be guaranteed. Actual events and the results of our operations may vary materially.

We do not assume any responsibility to publicly update any of our forward-looking statements regardless of whether factors change as a result of new information, future events, or for any other reason. You should review any additional disclosures we make in our press releases and Forms 10-K, 10-Q, and 8-K filed with or furnished to the SEC. We also suggest that you listen to our quarterly earnings release conference calls with financial analysts.

## Market risk

As filed, 269 characters.

For quantitative and qualitative disclosures about market risk, see Part II, Item 7(a), “Quantitative and Qualitative Disclosures About Market Risk,” in our 2013 Annual Report on Form 10-K. Our exposure to market risk has not changed materially since December 31, 2013.

## Controls and procedures

As filed, 1,443 characters.

In accordance with the Securities Exchange Act of 1934 Rules 13a-15 and 15d-15, we carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2014 to provide reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Our disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

There has been no change in our internal control over financial reporting that occurred during the three months ended September 30, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Filed Oct 24, 2014.
Source: SEC EDGAR, the filing index for accession 0000045012-14-000341. Last ingested by Listed: Nov 2, 2026, 13:24 ET. No prices; not investment advice.