Year-on-year, pretax operating margin decreased 194 bps to 13.4% as the result of the lower pricing and activity in
Marine and reduced profitability in Land and Data Processing. These decreases were partially offset by an improvement
in Multiclient margins on the increased activity.
Full-Year 2009 Results
Revenue
Income
before
taxes
Revenue
Income
before
taxes
2009
2008
(Stated in millions)
OILFIELD SERVICES
North America
$ 3,707 $ 216 $ 5,914 $1,371
Latin America
4,225
753
4,230
858
Europe/CIS/Africa
7,150
1,707
8,180
2,244
Middle East & Asia
5,234
1,693
5,724
2,005
Elims/Other
202
(43)
234
27
20,518
4,326
24,282
6,505
WESTERNGECO
2,122
326
2,838
836
Corporate
(1)
62
(344)
43
(268)
Interest income
(2)
52
112
Interest expense
(3)
(188)
(217)
Charges & credits
(4)
(238)
(116)
$22,702 $3,934 $27,163 $6,852
(1) Comprised principally of corporate expenses not allocated to the segments, interest on postretirement medical benefits, stock-based compen-
sation costs and certain other nonoperating items.
(2) Excludes interest income included in the segments’ income (2009 – $10 million; 2008 – $7 million).
(3) Excludes interest expense included in the segments’ income (2009 – $33 million; 2008 – $30 million).
(4) Charges and credits are described in detail in Note 3 to the
Consolidated Financial Statements.
Oilfield Services
Full-year 2009 revenue of $20.52 billion declined 16% versus 2008. Lower natural gas prices and unfavorable market
fundamentals resulted in a 37% decline in North America revenue, primarily in the US Land and Canada GeoMarkets.
Europe/CIS/Africa revenue decreased 13% mainly due to the weakening of local currencies against the US dollar and
reduced activity in the Russia, North Sea, West & South Africa and Caspian GeoMarkets as well as in Framo, which was
partially offset by increased activity in the North Africa GeoMarket. Middle East & Asia revenue also fell by 9% primarily
due to decreases in the East Asia, East Mediterranean, Arabian and Australia/Papua New Guinea GeoMarkets. Latin
America revenue was only marginally lower than last year as the impact of the weakening of local currencies against the
US dollar and much lower activity in Venezuela/Trinidad & Tobago and Peru/Colombia/Ecuador were nearly offset by
stronger activity in Mexico/Central America and Brazil. Weakening of local currencies against the US dollar reduced
2009 revenue by approximately 4%. Across the Areas, all of the Technologies recorded revenue declines except Testing
Services. IPM recorded revenue growth compared to the same period last year.
Full-year 2009 pretax operating margin decreased 5.7 percentage points to 21.1%, on the significant drop in activity
and pricing pressure experienced across all the Areas, but most notably in North America.
North America
Revenue of $3.71 billion was 37% lower than last year with reductions across the entire Area. The decreases were
highest in US Land and Canada, where lower natural gas prices resulted in a steep drop in activity and consequent
pressure on pricing. Canada revenue was also lower as the result of the weakening of the Canadian dollar against the
US dollar. Revenue in the US Gulf of Mexico GeoMarket was severely impacted by weaker shelf drilling activity and strong
pricing pressure.
Pretax operating margin fell 17.3 percentage points to 5.8% due to the significant decline in activity levels across the
Area, combined with the severe pricing erosion.
23
Part II, Item 7
