Weatherford’s first-quarter 2015 report reveals that, as of March 31, Weatherford has completed 81% of the initial 8,000 headcount reduction plan with realized annualized savings of $422 million, and that the company’s reduction in force target has increased by 2,000 to now include approximately 10,000 employees.
The quarterly report results show that the company’s free cash flow improved $426 million over the first quarter of 2014 and that capital expenditures of $224 million ($194 million net of lost-in-hole) remain in line with its reduced full-year guidance.
Bernard J. Duroc-Danner, chairman of the board, president and CEO, stated, "We managed a difficult first quarter successfully with much better sequential decrementals of 34% compared with 49% in the first quarter of 2009. This is due to the resilience of our international operations and margins, as well as our aggressive cost reductions in the face of rapidly declining activity and pricing.
"North America was very challenged, and we believe that the cost actions we have taken, and will take, in the second quarter will recover margins in the second half of the year. Internationally, our margin improvement, both sequentially and year-on-year, was best-in-class. We more than offset activity and pricing headwinds with cost reduction initiatives while protecting our market share.
"Our headcount at the end of the quarter dipped to 49,000 from 56,000 at the start of the year. This is rapid progress. Our current 18% headcount reduction goal for the year will leave us with about 39,000 employees in our core businesses and 6,000 rig employees. We are focused on de-layering our organization structure and emerging from this down cycle a leaner, fitter, and much more disciplined company, poised to improve margins with strong incrementals going forward."