Halliburton Co. Files 2023 Annual Report on Form 10-K

Ticker: HAL · Form: 10-K · Filed: 2024-02-06T00:00:00.000Z

Sentiment: neutral

Topics: Halliburton, 10-K, Annual Report, Oil and Gas, Financials

TL;DR

<b>Halliburton Co. has filed its 2023 10-K annual report detailing its financial performance and operations for the fiscal year ended December 31, 2023.</b>

AI Summary

HALLIBURTON CO (HAL) filed a Annual Report (10-K) with the SEC on February 6, 2024. Halliburton Co. filed its annual report on Form 10-K for the fiscal year ended December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. The company's principal executive offices are located at 3000 North Sam Houston Parkway East, Houston, TX 77032. Halliburton Co. was incorporated in Delaware. The filing includes financial data for the fiscal years 2023, 2022, and 2021.

Why It Matters

For investors and stakeholders tracking HALLIBURTON CO, this filing contains several important signals. This 10-K filing provides a comprehensive overview of Halliburton's financial health, operational segments, and risk factors for the fiscal year 2023, crucial for investors assessing the company's performance and future outlook. The detailed financial statements and disclosures within the 10-K are essential for understanding Halliburton's revenue streams, profitability, and balance sheet strength in the context of the oil and gas industry.

Risk Assessment

Risk Level: — HALLIBURTON CO shows moderate risk based on this filing. The filing is a standard annual report, but the oil and gas industry is subject to significant volatility in commodity prices and geopolitical events, which can impact Halliburton's financial results.

Analyst Insight

Investors should review the detailed financial statements and risk factors in the 10-K to assess Halliburton's performance and potential risks in the current energy market.

Key Numbers

Key Players & Entities

Forward-Looking Statements

FAQ

When did HALLIBURTON CO file this 10-K?

HALLIBURTON CO filed this Annual Report (10-K) with the SEC on February 6, 2024.

What is a 10-K filing?

A 10-K is a comprehensive annual financial report required by the SEC, covering audited financials, business operations, risk factors, and management discussion. This particular 10-K was filed by HALLIBURTON CO (HAL).

Where can I read the original 10-K filing from HALLIBURTON CO?

You can access the original filing directly on the SEC's EDGAR system. The filing is publicly available and includes all exhibits and attachments submitted by HALLIBURTON CO.

What are the key takeaways from HALLIBURTON CO's 10-K?

HALLIBURTON CO filed this 10-K on February 6, 2024. Key takeaways: Halliburton Co. filed its annual report on Form 10-K for the fiscal year ended December 31, 2023.. The filing covers the period from January 1, 2023, to December 31, 2023.. The company's principal executive offices are located at 3000 North Sam Houston Parkway East, Houston, TX 77032..

Is HALLIBURTON CO a risky investment based on this filing?

Based on this 10-K, HALLIBURTON CO presents a moderate-risk profile. The filing is a standard annual report, but the oil and gas industry is subject to significant volatility in commodity prices and geopolitical events, which can impact Halliburton's financial results.

What should investors do after reading HALLIBURTON CO's 10-K?

Investors should review the detailed financial statements and risk factors in the 10-K to assess Halliburton's performance and potential risks in the current energy market. The overall sentiment from this filing is neutral.

How does HALLIBURTON CO compare to its industry peers?

Halliburton operates in the oil and gas field services industry, which is cyclical and influenced by global energy demand and supply dynamics.

Are there regulatory concerns for HALLIBURTON CO?

The filing is made under the Securities Exchange Act of 1934, requiring public companies to disclose material information about their business, financial condition, and operations.

Industry Context

Halliburton operates in the oil and gas field services industry, which is cyclical and influenced by global energy demand and supply dynamics.

Regulatory Implications

The filing is made under the Securities Exchange Act of 1934, requiring public companies to disclose material information about their business, financial condition, and operations.

What Investors Should Do

  1. Review Halliburton's revenue breakdown by segment (Service and Product) for FY2023.
  2. Analyze the company's reported net income and EPS for FY2023 and compare with prior years.
  3. Examine the risk factors section for potential impacts on future operations and profitability.

Key Dates

Year-Over-Year Comparison

This is the initial filing of the 2023 10-K, providing the first official look at the company's performance for the full fiscal year compared to previous periods.

Filing Stats: 4,377 words · 18 min read · ~15 pages · Grade level 15.2 · Accepted 2024-02-06 14:42:35

Key Financial Figures

Filing Documents

PAGE

PART I PAGE Item 1.

Business

Business 1

(a)

Item 1(a).

Risk Factors

Risk Factors 9

(b)

Item 1(b). Unresolved Staff Comments 19

(c)

Item 1(c). Cyber s ecurity 19 Item 2.

Properties

Properties 20 Item 3.

Legal Proceedings

Legal Proceedings 20 Item 4. Mine Safety Disclosures 20 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 21 Item 6. ( Reserved ) 22 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Executive Overview 23 Liquidity and Capital Resources 25 Business Environment and Results of Operations 27 Results of Operations in 2023 Compared to 2022 29 Results of Operations in 2022 Compared to 2021 32 Critical Accounting Estimates 33 Financial Instrument Market Risk 35 Environmental Matters 36 Forward-Looking Information 36

(a)

Item 7(a).

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 37 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 38 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 70

(a)

Item 9(a).

Controls and Procedures

Controls and Procedures 70

(b)

Item 9(b). Other Information 70

(c)

Item 9(c). Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 70 PART III Item 10. Directors, Executive Officers, and Corporate Governance 71 Item 11.

Executive Compensation

Executive Compensation 71

(a)

Item 12(a).

Security Ownership of Certain Beneficial Owners

Security Ownership of Certain Beneficial Owners 71

(b)

Item 12(b).

Security Ownership of Management

Security Ownership of Management 71

(c)

Item 12(c). Changes in Control 71

(d)

Item 12(d). Securities Authorized for Issuance Under Equity Compensation Plans 71 Item 13. Certain Relationships and Related Transactions, and Director Independence 71 Item 14. Principal Accounting Fees and Services 71 PART IV Item 15. Exhibits 72 Item 16. Form 10-K Summary 77

SIGNATURES

SIGNATURES 78 i Table of Contents

| Business

Item 1 | Business PART I

Business

Item 1. Business. Description of business and strategy Halliburton Company is one of the world's largest providers of products and services to the energy industry. Its predecessor was established in 1919 and incorporated under the laws of the State of Delaware in 1924. Inspired by the past and leading into the future, what started with a single product from a single location is now a global enterprise. Our value proposition is to collaborate and engineer solutions to maximize asset value for our customers. We strive to achieve strong cash flows and returns for our shareholders by delivering technology and services that improve efficiency, increase recovery, and maximize production for our customers. Halliburton has fostered a culture of unparalleled service to the world's major, national, and independent oil and natural gas producers. With approximately 48,000 employees, representing over 130 nationalities in more than 70 countries, we help our customers maximize asset value 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 throughout the life of the asset. 2023 Highlights - Financial : Our total revenue increased 13% in 2023 as compared to 2022. Our International revenue increased 17% and our North America revenue increased 9% in 2023 compared to 2022, with improved margins driven by increased activity and pricing gains. Overall, our Completion and Production and Drilling and Evaluation operating segments finished the year with 21% and 17% operating margins, respectively. We generated strong cash flows from operations and repurchased $300 million of debt. - Digital : Our accelerated deployment and integration of digital and automation technologies created technical differentiation in the market and contributed to our higher margins and increased internal efficiencies. - Capital efficiency : We advanced technolog

| Business

Item 1 | Business Operating segments We operate under two divisions, which form the basis for the two operating segments we report, the Completion and Production segment and the Drilling and Evaluation segment. Completion and Production delivers cementing, stimulation, specialty chemicals, intervention, pressure control, artificial lift, and completion products and services. The segment consists of the following product service lines: - Artificial Lift: provides services to maximize reservoir and wellbore recovery by applying lifting technology, intelligent field management solutions, and related services throughout the life of the well, including electrical submersible pumps. - Cementing: involves bonding the well and well casing while isolating fluid zones and maximizing wellbore stability. Our cementing product service line also provides casing equipment. - Completion Tools: provides downhole solutions and services to our customers to complete their wells, including well completion products and services, intelligent well completions, liner hanger systems, sand control systems, multilateral systems, and service tools. - Multi-Chem: provides customized specialty chemicals and services for completion, production, midstream, and downstream to optimize flow assurance and integrity. - Pipeline & Process Services: provides a complete range of pre-commissioning, commissioning, maintenance, and decommissioning services to the onshore and offshore pipeline and process plant construction commissioning and maintenance industries. - Production Enhancement: includes stimulation services and sand control services. Stimulation services optimize reservoir production through a variety of pressure pumping services and chemical processes, commonly known as hydraulic fracturing and acidizing. Sand control services include fluids and chemicals for the prevention of sand production of unconsolidated reservoirs. - Production Solutions: provides customized well intervention

| Business

Item 1 | Business The following charts depict our revenue split between our two operating segments for the years ended December 31, 2023 and 2022. See Note 3 to the consolidated financial statements for further financial information related to each of our business segments. Markets and competition We are one of the world's largest diversified energy services companies. Our services and products are sold in highly competitive markets throughout the world. Competitive factors impacting sales of our services and products include: price; service delivery; health, safety, and environmental standards and practices; service quality; global talent retention; understanding the geological characteristics of the reservoir; product quality; warranty; and technical proficiency. We conduct business worldwide in more than 70 countries. The business operations of our divisions are organized around four primary geographic regions: North America, Latin America, Europe/Africa/CIS, and Middle East/Asia. In 2023, 2022, and 2021, based on the location of services provided and products sold, 44%, 45%, and 40%, respectively, of our consolidated revenue was from the United States. No other country accounted for more than 10% of our consolidated revenue during these periods. See "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" for additional information about our geographic operations. Because the markets for our services and products are vast and cross numerous geographic lines, it is not practicable to provide a meaningful estimate of the total number of our competitors. The industries we serve are highly competitive, and we have many substantial competitors. Most of our services and products are marketed through our service and sales organizations. The following charts depict our revenue split between our four primary geographic regions for the years ended December 31, 2023 and 2022. HAL 2023 FORM 10-K | 3 Table of Contents

| Business

Item 1 | Business Our operations in some countries and regions may be adversely affected by unsettled political conditions, acts of terrorism, civil unrest, force majeure, war or other armed conflict, health or similar issues, sanctions, expropriation or other governmental actions, inflation, changes in foreign currency exchange rates, 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 an interruption of operations in any one country, other than the United States, would be materially adverse to our business, consolidated results of operations, or consolidated financial condition. Information regarding our exposure to foreign currency fluctuations, risk concentration, and financial instruments used to minimize risk is included in " Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations – Financial Instrument Market Risk" and in Note 16 to the consolidated financial statements. Customers Our revenue during the past three years was derived from the sale of services and products to the energy industry. No single customer represented more than 10% of our consolidated revenue in any period presented. Raw materials Raw materials essential to our business are normally readily available. However, market conditions can trigger constraints in the supply of certain raw materials, such as proppants (primarily sand), chemicals, metals, and gels. We are always striving to ensure the availability of resources and manage raw material costs. Our procurement department uses our relationships and buying power to enhance our access to key materials at competitive prices. Patents We own a large number of patents and have pending a substantial number of patent applications covering various products and processes. We are also licensed to utilize technology covered by patents owned by oth

| Business

Item 1 | Business In 2023, we hired about 8,700 new employees and were able to rehire more than 2,000 former employees despite a tight labor market. We have found that hiring former employees allows us to add needed personnel who are able to apply their prior experience at the Company to quickly re-acclimate and add value to their teams. Leadership The ongoing identification and development of leadership talent ensures business continuity and strengthens our competitive advantage, both of which are critical for our short-term and long-term success. In 2023, we saw a 14% increase in female candidates on leadership succession charts compared to 2022. One of our most significant investments in developing future leaders is our executive education programs. In 2023, approximately 24% of the participants in these programs were female and 53 different nationalities were represented. As part of our commitment to employee engagement, we solicit feedback from employees on their workplace challenges, and empower them to share their perspectives and ideas to improve the overall employee experience, including performance, development, and work-life balance. Notably, according to a survey we conducted in 2023, 96% of responding employees feel the work they do everyday matters. This is especially meaningful since 84% of our employees responded to the survey. Benefits and well-being We provide our employees around the world with benefits that address the diverse needs of our workforce and their families. We evaluate our benefits package to identify opportunities for improvement and to remain competitive. In 2023, we enhanced healthcare benefits and expenditure planning for United States employees with refreshed medical plans, enhancements to our surrogacy offerings, legal plans, pharmacy advocacy programs, and a global business travel accident program. In 2023, we continued to expand our Employee Assistance Program (EAP) and now all Halliburton employees and their familie

| Business

Item 1 | Business The potential environmental impacts of hydraulic fracturing have been studied by numerous government entities and others. In 2004, the United States Environmental Protection Agency (EPA) conducted an extensive study of hydraulic fracturing practices, focusing on coalbed methane wells, and their potential effect on underground sources of drinking water. The EPA's study concluded that hydraulic fracturing of coalbed methane wells poses little or no threat to underground sources of drinking water. In December 2016, the EPA released a final report, " Hydraulic Fracturing for Oil and Gas: Impacts from the Hydraulic Fracturing Water Cycle on Drinking Water Resources in the United States " representing the culmination of a six-year study requested by Congress. While the EPA report noted a potential for some impact to drinking water sources caused by hydraulic fracturing, the agency confirmed the overall incidence of impacts is low. Moreover, a number of the areas of potential impact identified in the report involve activities for which we are not generally responsible, such as potential impacts associated with withdrawals of surface water for use as a base fluid and management of wastewater. We have proactively developed processes to provide our customers with the chemical constituents of our hydraulic fracturing fluids to enable our customers to comply with state laws as well as voluntary standards established by the Chemical Disclosure Registry, www.fracfocus.org. We have invested considerable resources in developing hydraulic fracturing technologies, in both the equipment and chemistry portions of our business, which offer our customers a variety of environment-friendly options related to the use of hydraulic fracturing fluid additives and other aspects of our hydraulic fracturing operations. We created a hydraulic fracturing fluid system comprised of materials sourced entirely from the food industry. We are committed to the continued development o

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