Posted on: Friday, January 30, 2004

Halliburton posts $947 million loss

By Kristen Hays
Associated Press

HOUSTON — Halliburton Co. posted a net loss of $947 million for the fourth quarter 2003 because of a $1.1 billion charge related to the oil field service conglomerate's pending $4.17 billion settlement of hundreds of thousands of asbestos claims.

Including the charge, the company reported a loss of $2.17 per share, compared with a net loss of $616 million, or $1.42 per share, in the fourth quarter 2002, which also reflected losses related to the asbestos settlement.

Excluding the charge, Halliburton's income from continuing operations was $146 million, or 34 cents per share, compared with a loss of $132 million, or 30 cents per share, in the year-ago period.

Shares of Halliburton rose 82 cents to close at $30.23 on the New York Stock Exchange.

Revenues for the quarter were $5.46 billion, compared with $3.35 billion in the fourth quarter 2002. Halliburton attributed the 63 percent jump in revenues to ongoing work in Iraq by Kellogg, Brown & Root, its engineering and construction subsidiary, which has a contract to supply the Army with food service, mail and other amenities and a separate one to rebuild oil facilities.

The Defense Department is investigating whether the company, formerly headed by Vice President Dick Cheney, overcharged for gasoline in Iraq, and will look into allegations of corruption involving billions of dollars of private work there after last week's revelations that Halliburton fired two workers and pledged to repay the Pentagon $6.3 million in possible kickbacks.

Dave Lesar, Halliburton's chairman, president and chief executive, told analysts the contract awards validate that the company is best suited for the work "based on what we know, not who we know."

For the year, Halliburton reported a net loss of $820 million, or $1.88 per share, in 2003, compared with a net loss of $998 million, or $2.31 per share, in 2002. Revenues for 2003 were $16.28 billion, compared with $12.57 billion in 2002.

In the fourth quarter Houston-based Halliburton filed a long-awaited, pre-negotiated bankruptcy for subsidiaries DII Industries and KBR and some of their subsidiaries in U.S. Bankruptcy Court in Pittsburgh to settle more than 370,000 asbestos and 21,000 silica claims as part of the settlement first announced in December 2002.

Halliburton inherited the asbestos claims when the conglomerate, while under Cheney's leadership, bought Dresser Industries Inc. for $7.7 billion. Cheney left Halliburton in 2000 to be President Bush's running mate.