XML 24 R11.htm IDEA: XBRL DOCUMENT v3.4.0.3
Business Segment and Geographic Information
 3 Months Ended
Mar. 31, 2016
Segment Reporting [Abstract]  
Business Segment and Geographic Information
Business Segment and Geographic Information

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. Intersegment revenue was immaterial. Our equity in earnings and losses of unconsolidated affiliates that are accounted for by the equity method of accounting are included within cost of services on our statements of operations, which is part of operating income of the applicable segment.

The following table presents information on our business segments.
 
Three Months Ended
March 31
Millions of dollars
2016
2015
Revenue:
 
 
Completion and Production
$
2,324

$
4,246

Drilling and Evaluation
1,874

2,804

Total revenue
$
4,198

$
7,050

Operating income (loss):
 
 
Completion and Production
$
30

$
462

Drilling and Evaluation
241

306

Total operations
271

768

Corporate and other (a)
(584
)
(108
)
Impairments and other charges (b)
(2,766
)
(1,208
)
Total operating loss
$
(3,079
)
$
(548
)
Interest expense, net of interest income (c)
(165
)
(106
)
Other, net
(47
)
(224
)
Loss from continuing operations before income taxes
$
(3,291
)
$
(878
)

(a) Includes certain expenses not attributable to a particular business segment such as costs related to support functions and corporate executives, as well as Baker Hughes acquisition-related costs incurred during the three months ended March 31, 2016.
(b) Includes $1.8 billion attributable to Completion and Production, $1.0 billion attributable to Drilling and Evaluation, and $5 million attributable to Corporate and other for the three months ended March 31, 2016. Includes $510 million attributable to Completion and Production, $638 million attributable to Drilling and Evaluation, and $60 million attributable to Corporate and other for the three months ended March 31, 2015.
(c) Includes $71 million of interest expense associated with the $7.5 billion debt issued in late 2015.

Receivables
As of March 31, 2016, 22% of our gross trade receivables were from customers in the United States. As of December 31, 2015, 26% of our gross trade receivables were from customers in the United States. Other than Venezuela, as further discussed below, no other country or single customer accounted for more than 10% of our gross trade receivables at these dates.

Venezuela. During the first quarter of 2015, we began utilizing the SIMADI exchange rate mechanism to remeasure our net monetary assets denominated in Bolívares, at a market rate of 192 Bolívares per United States dollar as compared to the official exchange rate of 6.3 Bolívares per United States dollar we had previously utilized, resulting in a foreign currency devaluation loss of $199 million. In February 2016, the Venezuelan government created a new exchange rate system, replacing the SIMADI with the DICOM, which is intended to be a free floating system and had a market rate of 276 Bolívares per United States dollar as of March 31, 2016. We are utilizing the DICOM to remeasure our net monetary assets denominated in Bolívares, and the revised system did not materially affect our financial statements for the three months ended March 31, 2016. For additional information about the new currency system, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Business Environment and Results of Operations.”    

Our total outstanding net trade receivables in Venezuela were $756 million as of March 31, 2016, compared to $704 million as of December 31, 2015, which represents more than 10% of our trade receivables for both periods. The majority of these receivables in Venezuela are United States dollar-denominated receivables. Of the $756 million of receivables in Venezuela as of March 31, 2016, $190 million have been classified as long-term and included within “Other assets” on our condensed consolidated balance sheets. Of the $704 million of receivables in Venezuela as of December 31, 2015, $175 million have been classified as long-term and included within “Other assets” on our condensed consolidated balance sheets. We have experienced delays in collecting payment on our receivables from our primary customer in Venezuela. These receivables are not disputed, and we have not historically had material write-offs relating to this customer. Additionally, we routinely monitor the financial stability of our customers. During the first quarter of 2016, we made the decision to begin curtailing activity in Venezuela.