GENEVA, July 20 /PRNewswire-FirstCall/ — Weatherford International Ltd. (NYSE: WFT) today reported second quarter 2010 income of $80 million, or $0.11 per diluted share, excluding an after tax loss of $0.15 per diluted share. The excluded after tax loss was comprised of an $82 million non-cash charge for a fair value adjustment to the put option issued in connection with the TNK-BP acquisition and $24 million, net of tax, for severance and investigation costs. Second quarter diluted earnings per share reflect an increase of ten percent over the second quarter of 2009 diluted earnings per share of $0.10, before severance and investigation costs.

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Second quarter revenues were $2,438 million, or 22 percent higher than the same period last year, and four percent higher than the prior quarter. Segment operating income of $308 million improved 14 percent year-over-year and 16 percent sequentially. International revenues were up seven percent versus the year ago quarter and five percent versus the prior quarter. Eastern Hemisphere revenues carried the international growth rate, increasing 16 percent versus the year ago quarter and nine percent versus the prior quarter, while Latin America revenue fell 12% compared to the year ago quarter and four percent sequentially due to lower project activity in Mexico. North America revenue increased 61 percent versus the year ago quarter and grew three percent versus the prior quarter. Stronger performance in the U.S. land market more than offset Canada’s traditional seasonal decline and one month of severely reduced activity in the Gulf of Mexico.

Sequentially, the company’s second quarter diluted earnings per share, before charges, were $0.04 higher than the first quarter of 2010 diluted earnings per share of $0.07, before severance, investigation costs and fair value adjustment for the put option.

Weatherford Chairman and CEO Bernard J. Duroc-Danner commented, “The second quarter was progress with the United States and Russia singled out as the highest performers. The outlook for North America appears constructive. Client feedback leads us to believe that operators are planning to accelerate activity in international markets.”

North America

Revenues for the quarter were $921 million, which is a 61 percent increase over the same quarter in the prior year. Revenues were up three percent sequentially, which is the first sequential increase for the second quarter in North America since 2005.

Operating income was $129 million compared to break-even operating results for the second quarter of 2009 and was up $17 million sequentially. The current quarter’s margins improved 140 basis points to 14.0%.

Middle East/North Africa/Asia

Second quarter revenues of $601 million were one percent higher than the second quarter of 2009 and six percent higher than the prior quarter. On a sequential basis, strong performances in Iraq and China were partially offset by weakness in Saudi Arabia and Libya.

The current quarter’s operating income of $78 million decreased 37 percent as compared to the same quarter in the prior year and decreased six percent compared to the prior quarter.

Europe/West Africa/FSU

Second quarter revenues of $506 million were 39 percent higher than the second quarter of 2009 and 11 percent higher than the prior quarter. The year-over-year increase was largely due to our acquisition of TNK-BP’s oilfield service business in the third quarter of 2009. All product lines showed sequential growth.

The current quarter’s operating income of $63 million was flat compared to the same quarter in the prior year and increased 63 percent sequentially.

Latin America

Second quarter revenues of $410 million were 12 percent lower than the second quarter of 2009 and four percent lower than the prior quarter. Consistent with the prior quarter, Mexico was the largest contributor to the sequential decline in revenue due to a decrease in volumes of project-based work.

The current quarter’s operating income of $38 million declined 56 percent as compared to the same quarter in the prior year and increased 22 percent compared to the prior quarter.

Reclassifications and Non-GAAP

Non-GAAP performance measures and corresponding reconciliations to GAAP financial measures have been provided for meaningful comparisons between current results and results in prior operating periods.

Conference Call

The company will host a conference call with financial analysts to discuss the 2010 second quarter results on July 20, 2010 at 8:00 a.m. (CDT). The company invites investors to listen to a play back of the conference call at the company’s website, http://www.weatherford.com in the “investor relations” section.

Weatherford is a Swiss-based, multi-national oilfield service company. It is one of the largest global providers of innovative mechanical solutions, technology and services for the drilling and production sectors of the oil and gas industry. Weatherford operates in over 100 countries and employs over 53,000 people worldwide.

Contact:

Andrew P. Becnel

+41.22.816.1502

Chief Financial Officer

Contact:

Karen David-Green

+1.713.693.2530

Vice President – Investor Relations

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning, among other things, Weatherford’s prospects for its operations which are subject to certain risks, uncertainties and assumptions. These risks and uncertainties, which are more fully described in Weatherford International Ltd.’s reports and registration statements filed with the SEC, include the impact of oil and natural gas prices and worldwide economic conditions on drilling activity, the outcome of pending government investigations, the demand for and pricing of Weatherford’s products and services, domestic and international economic and regulatory conditions and changes in tax and other laws affecting our business. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary materially from those currently anticipated.

Weatherford International Ltd.

Consolidated Condensed Statements of Income

(Unaudited)

(In 000s, Except Per Share Amounts)

Three Months

Six Months

Ended June 30,

Ended June 30,

2010

2009

2010

2009

Net Revenues:

North America

$ 921,443

$ 571,415

$ 1,811,987

$ 1,408,768

Middle East/North Africa/Asia

600,777

592,908

1,165,756

1,174,854

Europe/West Africa/FSU

505,774

364,968

960,475

733,811

Latin America

410,277

465,541

838,301

933,540

2,438,271

1,994,832

4,776,519

4,250,973

Operating Income (Expense):

North America

129,361

(709)

241,688

122,327

Middle East/North Africa/Asia

78,009

123,553

160,805

257,579

Europe/West Africa/FSU

62,834

62,614

101,362

137,557

Latin America

37,984

85,759

69,063

177,976

Research and Development

(53,530)

(46,113)

(102,387)

(95,134)

Corporate Expenses

(42,732)

(40,834)

(89,852)

(80,433)

Revaluation of Contingent Consideration

(81,753)

-

(89,563)

-

Exit and Restructuring

(27,309)

(30,905)

(71,341)

(55,782)

102,864

153,365

219,775

464,090

Other Income (Expense):

Interest Expense, Net

(95,719)

(93,498)

(191,058)

(184,561)

Devaluation of Venezuelan Bolivar

-

-

(63,859)

-

Other, Net

(14,186)

(3,871)

(23,404)

(17,410)

Income (Loss) Before Income Taxes

(7,041)

55,996

(58,546)

262,119

Benefit (Provision) for Income Taxes:

Provision for Operations

(19,095)

(8,829)

(29,980)

(44,633)

Benefit from Devaluation of Venezuelan Bolivar

-

-

23,973

-

Benefit from Exit and Restructuring

2,888

3,388

5,331

6,729

(16,207)

(5,441)

(676)

(37,904)

Net Income (Loss)

(23,248)

50,555

(59,222)

224,215

Net Income Attributable to Noncontrolling Interest

(3,316)

(8,574)

(7,351)

(17,432)

Net Income (Loss) Attributable to Weatherford

$ (26,564)

$ 41,981

$ (66,573)

$ 206,783

Earnings (Loss) Per Share Attributable to Weatherford:

Basic

$ (0.04)

$ 0.06

$ (0.09)

$ 0.30

Diluted

$ (0.04)

$ 0.06

$ (0.09)

$ 0.29

Weighted Average Shares Outstanding:

Basic

743,209

700,424

740,537

699,375

Diluted

743,209

709,412

740,537

706,024

Weatherford International Ltd.

Selected Income Statement Information

(Unaudited)

(In 000s)

Three Months

Ended

6/30/2010

3/31/2010

12/31/2009

9/30/2009

6/30/2009

Net Revenues:

North America

$ 921,443

$ 890,544

$ 736,443

$ 620,496

$ 571,415

Middle East/North Africa/Asia

600,777

564,979

593,154

600,110

592,908

Europe/West Africa/FSU

505,774

454,701

478,259

404,390

364,968

Latin America

410,277

428,024

618,225

524,883

465,541

$ 2,438,271

$ 2,338,248

$ 2,426,081

$ 2,149,879

$ 1,994,832

Operating Income (Expense):

North America

$ 129,361

$ 112,327

$ 41,625

$ 33,259

$ (709)

Middle East/North Africa/Asia

78,009

82,796

82,452

101,943

123,553

Europe/West Africa/FSU

62,834

38,528

48,893

44,468

62,614

Latin America

37,984

31,079

49,271

54,343

85,759

Research and Development

(53,530)

(48,857)

(50,216)

(49,300)

(46,113)

Corporate Expenses

(42,732)

(47,120)

(48,990)

(44,272)

(40,834)

Revaluation of Contingent Consideration

(81,753)

(7,810)

(6,295)

27,368

-

Exit and Restructuring

(27,309)

(44,032)

(26,897)

(17,887)

(30,905)

$ 102,864

$ 116,911

$ 89,843

$ 149,922

$ 153,365

Supplemental Information

(Unaudited)

(In 000s)

Three Months

Ended

6/30/2010

3/31/2010

12/31/2009

9/30/2009

6/30/2009

Depreciation and Amortization:

North America

$ 81,040

$ 80,660

$ 83,658

$ 79,737

$ 77,253

Middle East/North Africa/Asia

75,139

72,290

72,739

65,771

60,921

Europe/West Africa/FSU

52,058

48,958

50,376

44,864

35,190

Latin America

44,753

42,479

42,751

43,403

35,971

Research and Development

2,324

2,224

1,980

1,940

2,017

Corporate

2,943

2,781

2,197

2,194

2,341

$ 258,257

$ 249,392

$ 253,701

$ 237,909

$ 213,693

We report our financial results in accordance with generally accepted accounting principles (GAAP). However, Weatherford’s management believes that certain non-GAAP performance measures and ratios may provide users of this financial information additional meaningful comparisons between current results and results in prior operating periods. One such non-GAAP financial measure we may present from time to time is operating income or income from continuing operations excluding certain charges or amounts. This adjusted income amount is not a measure of financial performance under GAAP. Accordingly, it should not be considered as a substitute for operating income, net income or other income data prepared in accordance with GAAP. See the table below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended June 30, 2010, March 31, 2010, and June 30, 2009 and for the six months ended June 30, 2010 and June 30, 2009. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with GAAP.

Weatherford International Ltd.

Reconciliation of GAAP to Non-GAAP Financial Measures

(Unaudited)

(In 000s, Except Per Share Data)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

June 30,

June 30,

2010

2010

2009

2010

2009

Operating Income:

GAAP Operating Income

$ 102,864

$ 116,911

$ 153,365

$ 219,775

$ 464,090

Exit and Restructuring

27,309

44,032

30,905

71,341

55,782

Revaluation of Contingent Consideration

81,753

7,810

-

89,563

-

Non-GAAP Operating Income

$ 211,926

$ 168,753

$ 184,270

$ 380,679

$ 519,872

Benefit (Provision) for Income Taxes:

GAAP Benefit (Provision) for Income Taxes

$ (16,207)

$ 15,531

$ (5,441)

$ (676)

$ (37,904)

Devaluation of Venezuelan Bolivar

-

(23,973)

-

(23,973)

-

Exit and Restructuring

(2,888)

(2,443)

(3,388)

(5,331)

(6,729)

Non-GAAP Benefit (Provision) for Income Taxes

$ (19,095)

$ (10,885)

$ (8,829)

$ (29,980)

$ (44,633)

Net Income (Loss) Attributable to Weatherford:

GAAP Net Income (Loss)

$ (26,564)

$ (40,009)

$ 41,981

$ (66,573)

$ 206,783

Total Charges, net of tax

106,174

(a)

89,285

(b)

27,517

(c)

195,459

49,053

(d)

Non-GAAP Net Income

$ 79,610

$ 49,276

$ 69,498

$ 128,886

$ 255,836

Diluted Earnings (Loss) Per Share Attributable to Weatherford:

GAAP Diluted Earnings (Loss) per Share

$ (0.04)

$ (0.05)

$ 0.06

$ (0.09)

$ 0.29

Total Charges, net of tax

0.15

(a)

0.12

(b)

0.04

(c)

0.26

0.07

(d)

Non-GAAP Diluted Earnings per Share

$ 0.11

$ 0.07

$ 0.10

$ 0.17

$ 0.36

Note (a): This amount is comprised of an $82 million charge for the revaluation of contingent consideration included as part of our acquisition of the Oilfield Services Division (“OFS”) of TNK-BP. We also incurred investigation costs in connection with on-going investigations by the U.S. government and severance charges associated with the Company’s restructuring activities.

Note (b): This amount is primarily comprised of a $38 million charge, net of tax, related to our supplemental executive retirement plan that was frozen on March 31, 2010 and a $40 million charge, net of tax, related to the devaluation of the Venezuelan Bolivar. In addition, we incurred a charge of $8 million for the revaluation of contingent consideration included as part of our OFS acquisition. We also incurred investigation costs in connection with on-going investigations by the U.S. government and severance charges and facility closure costs associated with the Company’s restructuring activities.

Note (c): This amount represents investigation costs incurred in connection with on-going investigations by the U.S. government and costs related to the Company’s withdrawal from sanctioned countries. Also included are severance charges associated with the Company’s reorganization activities.

Note (d): This amount represents investigation costs incurred in connection with on-going investigations by the U.S. government and costs related to the Company’s withdrawal from sanctioned countries. Also included are severance charges associated with the Company’s reorganization activities.

Weatherford International Ltd.

Consolidated Condensed Balance Sheet

(Unaudited)

(In 000s)

June 30,

December 31,

2010

2009

Current Assets:

Cash and Cash Equivalents

$ 222,783

$ 252,519

Accounts Receivable, Net

2,471,078

2,504,876

Inventories

2,371,489

2,239,762

Other Current Assets

1,253,261

1,143,449

6,318,611

6,140,606

Long-Term Assets:

Property, Plant and Equipment, Net

6,774,500

6,991,579

Goodwill

4,128,966

4,156,105

Other Intangibles, Net

749,654

778,786

Equity Investments

539,817

542,667

Other Assets

303,179

256,440

12,496,116

12,725,577

Total Assets

$ 18,814,727

$ 18,866,183

Current Liabilities:

Short-term Borrowings and Current Portion of Long-term Debt

$ 628,108

$ 869,581

Accounts Payable

1,127,875

1,002,359

Other Current Liabilities

994,757

924,948

2,750,740

2,796,888

Long-term Liabilities:

Long-term Debt

6,005,472

5,847,258

Other Liabilities

383,871

423,333

6,389,343

6,270,591

Total Liabilities

9,140,083

9,067,479

Shareholders’ Equity:

Weatherford Shareholders’ Equity

9,603,780

9,719,672

Noncontrolling Interest

70,864

79,032

Total Shareholders’ Equity

9,674,644

9,798,704

Total Liabilities and Shareholders’ Equity

$ 18,814,727

$ 18,866,183

Weatherford International Ltd.

Net Debt

(Unaudited)

(In 000s)

Change in Net Debt for the Three Months Ended June 30, 2010:

Net Debt at March 31, 2010

$ (6,628,951)

Operating Income

102,864

Depreciation and Amortization

258,257

Exit and Restructuring

27,309

Revaluation of Contingent Consideration

81,753

Capital Expenditures

(217,664)

(Increase) Decrease in Working Capital

92,668

Income Taxes Paid

(133,382)

Interest Paid

(70,023)

Acquisitions and Divestitures of Assets and Businesses, Net

40,649

Other

35,723

Net Debt at June 30, 2010

$ (6,410,797)

Change in Net Debt for the Six Months Ended June 30, 2010:

Net Debt at December 31, 2009

$ (6,464,320)

Operating Income

219,775

Depreciation and Amortization

507,649

Exit and Restructuring

71,341

Revaluation of Contingent Consideration

89,563

Capital Expenditures

(448,751)

(Increase) Decrease in Working Capital

(96,352)

Income Taxes Paid

(224,117)

Interest Paid

(209,620)

Acquisitions and Divestitures of Assets and Businesses, Net

81,860

Other

62,175

Net Debt at June 30, 2010

$ (6,410,797)

June 30,

March 31,

December 31,

Components of Net Debt

2010

2010

2009

Cash

$ 222,783

$ 207,099

$ 252,519

Short-term Borrowings and Current Portion of Long-Term Debt

(628,108)

(991,440)

(869,581)

Long-term Debt

(6,005,472)

(5,844,610)

(5,847,258)

Net Debt

$ (6,410,797)

$ (6,628,951)

$ (6,464,320)

“Net Debt” is debt less cash. Management believes that Net Debt provides useful information regarding the level of

Weatherford indebtedness by reflecting cash that could be used to repay debt.

Working capital is defined as accounts receivable plus inventory less accounts payable.

SOURCE Weatherford International Ltd.