Halliburton Announces Third Quarter Earnings of $0.58 Per Diluted Share.HOUSTON -- Halliburton (NYSE NYSE See: New York Stock Exchange :HAL Hal: see Halle, Belgium. hal In Sufism, a state of mind reached from time to time by mystics during their journey toward God. The ahwal (plural of hal) are God-given graces that appear when a soul is purified of its attachments to the material world. ) announced today that income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the in the third quarter of 2006 was $615 million, or $0.58 per diluted share. This compares to income from continuing operations of $492 million, or $0.47 per diluted share, in the third quarter of 2005. Net income in the third quarter of 2006 included a $4 million after-tax loss related to discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , while net income in the third quarter of 2005 included after-tax income from discontinued operations of $7 million. Consolidated revenue in the third quarter of 2006 was $5.8 billion, up 19% from the third quarter of 2005. This increase was largely attributable to higher activity in the Energy Services Group, particularly in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Consolidated operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $968 million in the third quarter of 2006 compared to $680 million in the third quarter of 2005. The Energy Services Group (ESG ESG Enterprise Strategy Group (Veritas) ESG Emergency Shelter Grant (Florida, USA) ESG Expeditionary Strike Group ESG Electronic Service Guide (used in DVB) ) benefited from increased customer activity and pricing gains. Operating margins at ESG were their highest ever, at 26.7%. Operating income for the third quarter of 2005 included $85 million in income on the sale by KBR KBR Kellogg, Brown and Root KBr Potassium Bromide KBR Key-Based Routing KBR Kota Bharu, Malaysia - Sultan Ismail Petra (Airport Code) KBR Koninklijke Bibliotheek van België / Bibliothèque royale de Belgique of an equity investment in a toll road. "This was an exceptional quarter for Halliburton. The Energy Services Group improved on its impressive second quarter results, growing revenue 9 percent sequentially, and again setting new records for revenue, operating income, and operating margins. I'm also pleased with the quarterly performance of KBR, which posted a 7.5 percent operating margin in the Energy and Chemicals segment," said Dave Lesar, chairman, president, and chief executive officer of Halliburton. 2006 Third Quarter Segment Results Energy Services Group ESG posted record revenue of $3.4 billion in the third quarter of 2006, a $795 million or 31% increase over the third quarter of 2005. ESG posted record operating income of $906 million, up $340 million or 60% from the same period in the prior year. ESG's record operating margin was 26.7% during the third quarter of 2006, a 490 basis point improvement from the third quarter of 2005. Hurricanes in the third quarter of 2005 negatively impacted ESG operating income by approximately $28 million. Production Optimization operating income for the third quarter of 2006 was $406 million, an increase of $158 million or 64% over the third quarter of 2005. Production Enhancement services operating income grew 58%, with improvements in all regions, driven by strong demand for well stimulation services and improved pricing in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Canada. Production Enhancement results also benefited from improved asset utilization and increased well stimulation services in Venezuela, increased offshore activity in Mexico, and strong activity in northern Africa. Completion Tools operating income more than doubled, with improvements in all regions, due to increased sales in Brazil, Malaysia, Sakhalin, Angola, and throughout the Middle East. Fluid Systems operating income for the third quarter of 2006 was $211 million, a $72 million or 52% increase over the third quarter of 2005. Cementing services operating income increased 49%, with improvements in all regions, due to increased activity and improved pricing. Baroid Fluid Services operating income grew 60% on improved pricing and better product mix in the United States, growth in deepwater activity in the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east , and increased activity in Latin America and the Middle East. Drilling and Formation Evaluation operating income for the third quarter of 2006 was $227 million, an $83 million or 58% increase over the prior year third quarter. Sperry Drilling Services Sperry Drilling Services is Halliburton's division of MWD (measurement while drilling), LWD (Logging While Drilling), DD (Directional Drilling) and SDL (Surface Data Logging) tools and services. operating income increased 68%, with improvements in all regions, led by the Gulf of Mexico, Asia Pacific, and the Middle East. The demand for Geo-Pilot[R] and GeoTap[R] systems contributed to sales growth in excess of 60% for these technologies over the prior year period. Wireline and Perforating services operating income increased 53% due to increased activity and improved asset utilization in the United States and Asia Pacific. Demand for services in the Middle East and pricing improvement also contributed to Wireline and Perforating services' increase in operating income. Security DBS (Direct Broadcast Satellite) A one-way TV broadcast service from a communications satellite to a small round or oval dish antenna no larger than 20" in diameter. Drill Bits operating income improved 37% over the prior year third quarter, reflecting improved fixed cutter and roller cone bit The introduction to this article provides insufficient context for those unfamiliar with the subject matter. Please help [ improve the introduction] to meet Wikipedia's layout standards. You can discuss the issue on the talk page. activity in the United States, the Middle East, and Asia Pacific. Digital and Consulting Solutions operating income in the third quarter of 2006 was $62 million, an increase of $27 million or 77% compared to the prior year quarter. Landmark's operating income more than doubled compared to operating income of the prior year period, posting improvements in all regions on stronger software sales. KBR KBR revenue for the third quarter of 2006 was $2.4 billion compared to $2.3 billion in the third quarter of 2005. Operating income for the third quarter of 2006 was $98 million compared to operating income of $140 million in the prior year third quarter. Government and Infrastructure operating income for the third quarter of 2006 was $53 million, compared to $150 million in the third quarter of 2005. Results in the third quarter of 2006 included an impairment charge of $32 million on a railroad investment in Australia. Third quarter of 2005 results included $85 million in income on the sale of KBR's equity investment in a toll road. Energy and Chemicals posted operating income of $45 million in the third quarter of 2006 compared to an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $10 million in the third quarter of 2005. Third quarter 2005 results were impacted by $47 million of charges related to an Algerian joint venture and an additional $23 million loss on an Algerian gas processing plant project. Halliburton's Iraq-related work contributed approximately $1.2 billion in revenue in the third quarter of 2006 and $45 million of operating income, a 3.7% margin, before corporate expenses and taxes. Corporate As previously announced in September 2006, the company's Board of Directors authorized a $2 billion increase in its common share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program. In the third quarter of 2006, the company repurchased 26.6 million shares at an average price of $32.51 per share, for approximately $865 million. Approximately 31.6 million shares at an average price of $32.99 per share have been repurchased since the commencement of the program in March 2006. Technology and Significant Achievements Halliburton made a number of advances in technology and new contract awards. Energy Services Group new contract awards and technologies: * Halliburton's Fluid Systems segment has been awarded a four-year, $50 million contract to provide cementing services for TOTAL E&P INDONESIE offshore Balikpapan, East Kalimantan, Indonesia. Work began in the second quarter of 2006 and involves the provision of cementing services on all offshore rigs contracted by TOTAL E&P INDONESIE in the Sisi Nubi field development for the duration of the contract, as well as for development wells to be drilled in Bekapai's Peciko field, and exploration wells to be drilled by jack-up and floating rigs. The work will be supported from a new, purpose-built Halliburton service facility in Balikpapan, incorporating the country's largest fluids laboratory. * Halliburton's Drilling and Formation Evaluation segment has been awarded a contract valued at more than $60 million from TOTAL E&P INDONESIE to provide Geo-Pilot[R] rotary steerable systems and directional and logging-while-drilling services for the Peciko, Bekapai, Sisi and Nubi gas fields, offshore Balikpapan, East Kalimantan, Indonesia. * The Abu Dhabi Company for Onshore Oil Production (ADCO ADCO Abu Dhabi Company for Onshore Oil Operations ADCO Alcohol and Drug Control Officer ADCO Air Defense Control Center ADCO Alcohol & Drug Control Office ADCO Air Defense Communications Office ADCO Air Defense Coordination Organization ) has awarded Halliburton contracts valued at more than $70 million for cementing services, stimulation services, and special tools. Under the three-year agreement, Halliburton will provide optimum solutions to ongoing ADCO exploration and production activities located in the onshore fields of Abu Dhabi, United Arab Emirates United Arab Emirates, federation of sheikhdoms (2005 est. pop. 2,563,000), c.30,000 sq mi (77,700 sq km), SE Arabia, on the Persian Gulf and the Gulf of Oman. . * Halliburton's Production Optimization segment has added a breakthrough technology to its suite of stimulation products, GasPerm 1000SM service. GasPerm 1000 service helps improve production from unconventional reservoirs including tight gas, shales, and coalbed methane. Based on a newly developed microemulsion surfactant Surfactant Definition Surfactant is a complex naturally occurring substance made of six lipids (fats) and four proteins that is produced in the lungs. It can also be manufactured synthetically. , the service helps remove water drawn into the formation during the fracturing process. Removing the water can improve permeability to gas at the fracture face and help increase gas production. In addition, GasPerm 1000 service represents a safety and environmental advancement, replacing methanol in many applications. * Landmark, a brand of Halliburton's Digital and Consulting Solutions segment, introduced a new high-performance team-room visualization and interpretation solution at the Society of Exploration Geophysicists The Society of Exploration Geophysicists (or SEG) is a nonprofit organization dedicated to promoting the science of geophysics and the education of exploration geophysicists. trade show in New Orleans. This new solution features Landmark's GeoProbe[R] software, the Verari Systems[TM] E&P 7500 visualization server, and high-end NVIDIA[R] Quadro[R] graphics. It is specifically designed to help upstream oil and gas companies affordably manage large regional data sets, utilize advanced multi-attribute visualization, and enable rapid, basin-scale decision-making. KBR new contract awards: * KBR has signed a contract to provide project management and cost-reimbursable engineering, procurement, and construction management (EPCM EPCM Engineering, Procurement, Construction Management EPCM Essential Procedures for Clinical Microbiology EPCM Enhanced Planning Control Message EPCM Enterprise Portal Content Management EPCM European Project & Change Management (The Netherlands) ) services to Qatar Shell GTL GTL - Gunning Transceiver Logic Limited, a Royal Dutch Shell plc Royal Dutch Shell PLC formerly Royal Dutch/Shell Group Multinational corporation comprising two founding companies, Royal Dutch Petroleum Co. of The Hague, Neth., and Shell Transport and Trading Co., PLC, of London, Eng. The two companies began as rivals. subsidiary, for the Pearl gas-to-liquids (GTL) project in Ras Laffan, Qatar. KBR will undertake the work in a joint venture with JGC JGC Jeep Grand Cherokee JGC Japan Gasoline Co. JGC Grand Canyon, Arizona, Heliport (Airport Code) of Japan, incorporating the services of MWKL, a KBR/JGC subsidiary. Halliburton, founded in 1919, is one of the world's largest providers of products and services to the petroleum and energy industries. The company serves its customers with a broad range of products and services through its Energy Services Group and KBR. The company's World Wide Web site can be accessed at www.halliburton.com. NOTE: The statements in this press release that are not historical statements, including statements regarding future financial performance, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: consequences of audits and investigations of the company by domestic and foreign government agencies and legislative bodies and related publicity; potential adverse proceedings by such agencies; contract disputes with the company's customers; protection of intellectual property rights; compliance with environmental laws; changes in government regulations and regulatory requirements, particularly those related to radioactive sources, explosives, and chemicals; compliance with laws related to income taxes and assumptions regarding the generation of future taxable income Under the federal tax law, gross income reduced by adjustments and allowable deductions. It is the income against which tax rates are applied to compute an individual or entity's tax liability. The essence of taxable income is the accrual of some gain, profit, or benefit to a taxpayer. ; unsettled political conditions, war, and the effects of terrorism, foreign operations, and foreign exchange rates and controls; weather-related issues including the effects of hurricanes and tropical storms; changes in capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. by, and claims negotiations with, customers; changes in the demand for or price of oil and/or gas, structural changes in the industries in which the company operates, and performance of fixed-fee projects; the development and installation of financial systems; increased competition for employees; availability of raw materials; and integration of acquired businesses, operations of joint venture, and completion of planned dispositions. Halliburton's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2005, Form 10-Q Form 10-Q See 10-Q. for the period ended June 30, 2006, recent Current Reports on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. , and other Securities and Exchange Commission filings discuss some of the important risk factors identified that may affect the business, results of operations, and financial condition. Halliburton undertakes no obligation to revise or update publicly any forward-looking statements for any reason. 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