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Item 2. Management’s Discussion and Analysis

2022-04-28 compared with 2021-11-02 · 176 added, 243 removed, 61 unchanged (87% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

As used herein, “Weatherford,” the “Company,” “we,” “us” and “our,” refer to Weatherford International plc, a public limited company organized under the laws of Ireland, and its subsidiaries on a consolidated basis.

As used in this item, “Weatherford”, “the Company,” “we,” “us” and “our” refer to Weatherford International plc, a public limited company organized under the laws of Ireland, and its subsidiaries on a consolidated basis.

The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements and Notes thereto included in “Item 1.

Financial Statements.” Our discussion includes various forward-looking statements about our markets, the demand for our products and services and our future results.

These statements are based on certain assumptions we consider reasonable.

For information about these assumptions, please review the section entitled “Forward-Looking Statements” and the section entitled “Part II – Other Information – Item 1A.

These statements include assumptions, certain risks and uncertainties.

For information about these assumptions, risks and uncertainties, refer to the section “Forward-Looking Statements” and the section “Part II – Other Information – Item 1A.

– Risk Factors.”

We conduct operations in approximately 75 countries and have service and sales locations in oil and natural gas producing regions globally.

Our operational performance is reviewed on a geographic basis, and we report the Western Hemisphere and Eastern Hemisphere as separate, distinct reporting segments.

Our principal business is to provide equipment and services to the oil and natural gas exploration and production industry, both onshore and offshore.

Our two product lines are as follows:

(1) Completion and Production and (2) Drilling, Evaluation and Intervention.

• Completion and Production (“C&P”) offers a suite of modern completion products, reservoir stimulation designs, and engineering capabilities that isolate zones and unlock reserves in deepwater, unconventional, and aging reservoirs and production optimization services and a complete production ecosystem, featuring our artificial-lift portfolio, testing and flow-measurement solutions, and optimization software, to boost productivity and profitability.

• Drilling, Evaluation and Intervention (“DEI”) comprises a suite of services ranging from early well planning to reservoir management.

The drilling services offer innovative tools and expert engineering to increase efficiency and maximize reservoir exposure.

Evaluation services merge wellsite capabilities including wireline and managed pressure drilling.

We also build and rebuild well integrity for the full life cycle of the well.

Using conventional to advanced equipment, we offer safe and efficient tubular running services in any environment.

Our skilled fishing and re-entry teams execute under any contingency from drilling to abandonment, and our drilling tools provide reliable pressure control even in extreme wellbores.

Financial Results and Overview

Revenues totaled $945 million and $2.7 billion in the third quarter and first nine months of 2021, respectively, an improvement of $138 million, or 17%, and a decline of $163 million, or 6%, compared to the third quarter and first nine months of 2020, respectively.

The third quarter of 2021 year-over-year improvement reflects a 28% increase in service revenues driven by higher demand in certain C&P and DEI sub-product lines, primarily in North America and South America, which spurred the 40% growth in the Western Hemisphere and a 3% increase in the Eastern Hemisphere.

Western Hemisphere growth was primarily driven by higher business activity levels for C&P services and products primarily in Canada, Argentina and the United States.

The 6% revenue decline in the first nine months of 2021 compared to 2020 was primarily due to the lower business activity experienced during the first quarter of 2021 compared to the pre-COVID-19 first quarter of 2020.

The pandemic had an immediate negative impact beginning in the second quarter of 2020 in the Western Hemisphere while taking longer to significantly impact the Eastern Hemisphere.

Total operating income improved $131 million and $1.5 billion in the third quarter of 2021 and first nine months of 2021 compared to the third quarter and first nine months of 2020, respectively, primarily from the absence of impairment and restructuring charges in 2021.

In addition, selling, general and administrative, corporate, and research and development expense declined in the first nine months of 2021, reflecting the benefits of the cost improvement initiatives that were implemented during 2020 and earlier in 2021.

Segment operating income was $79 million and $118 million in the third quarter and first nine months of 2021, respectively, an increase of $76 million for both the third quarter and first nine months of 2021, compared to the third quarter

and first nine months of 2020.

The third quarter of 2021 year-over-year improvement was driven by the increased activity levels and demand for both C&P and DEI services primarily in North America, South America and Middle East & North Africa and Asia (“MENA/Asia”).

The first nine months of 2021 year-over-year improvement was driven by the increased activity levels and demand for C&P and DEI services primarily in the Western Hemisphere with improvements in North and South America.

Impairments and Other Charges (Credits), Net

Please see summary of details at “Note 2 – Impairments and Other Charges (Credits), Net” to our Condensed Consolidated Financial Statements.

We are a leading global energy services company providing equipment and services used in the drilling, evaluation, well construction, completion, production, intervention and responsible abandonment of wells across the broad spectrum of energy sources.

Many of our businesses, including those of our predecessor companies, have been operating for more than 50 years.

We conduct operations in approximately 75 countries, answering the challenges of the energy industry with 350 operating locations including manufacturing, research and development, service, and training facilities.

Our principal business is to provide equipment and services to the oil and natural gas exploration and production industry as well as new energy platforms across our three product line segments:

(1) Drilling and Evaluation (2) Well Construction and Completions, and (3) Production and Intervention.

All of our segments are enabled by a full suite of digital, monitoring, optimization and artificial intelligence solutions providing services throughout the well life cycle, including responsible abandonment.

Drilling and Evaluation (“DRE”) offers a suite of services including managed pressure drilling, drilling services, wireline and drilling fluids.

DRE offers services ranging from early well planning to reservoir management through innovative tools and expert engineering to optimize reservoir access and productivity.

Well Construction and Completions (“WCC”) offers products and services for well integrity assurance across the full life cycle of the well.

The primary offerings are tubular running services, cementation products, completions, liner hangers and well services.

WCC deploys conventional to advanced technologies, providing safe and efficient services in any environment during the well construction phase.

Production and Intervention (“PRI”) offers production optimization technologies through the Company’s ability to design and deliver a complete production ecosystem to boost productivity and responsible abandonment for our customers.

The primary offerings are intervention services & drilling tools, artificial lift, production automation & software, sub-sea intervention and pressure pumping services.

PRI utilizes a suite of reservoir stimulation designs, and engineering capabilities that isolate zones and unlock reserves in conventional and unconventional wells, deep water, and aging reservoirs.

Industry Trends

The level of spending in the energy industry is heavily influenced by the current and expected future prices of oil and natural gas, but is also impacted by environmental, social and governance (“ESG”) initiatives, ongoing supply chain shortages, and customer capital spending plans.

These factors result in an increase or decrease in demand for our products and services.

Rig count is an indicator of the level of spending for the exploration and production of oil and natural gas reserves.

The following charts set forth certain statistics that reflect historical market conditions.

The table below shows the average oil and natural gas prices for West Texas Intermediate (“WTI”), United Kingdom Brent crude oil and Henry Hub natural gas.

Three Months Ended Year Ended

The level of spending in the energy industry is heavily influenced by the current and expected future prices of oil and natural gas, but is also impacted by environmental, social and governance (“ESG”) initiatives, and ongoing supply chain shortages as well as geopolitical events like the ongoing military conflict between Russia and Ukraine (“Russia Ukraine Conflict”).

These recent events, in addition to the reopening of the global economy around the relaxing of public restrictions related to the COVID-19 pandemic, have caused commodity prices to increase year-over-year.

The industry is also impacted by sanctions.

Most notably, several countries including the United States, the European Union and the United Kingdom, have imposed broad sanctions against Russia, certain Russian individuals and certain activities involving Russia or Russian individuals.

These factors may result in an increase or decrease in demand for our products and services.

The table below shows the average oil and natural gas prices for West Texas Intermediate (“WTI”) and Brent North Sea (“Brent”) crude oil and Henry Hub natural gas during the three months ended March 31, 2022 and 2021.

Three Months Ended

3/31/2022 3/31/2021

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Natural gas price - Henry Hub (2)

$4.36 $2.00 $2.04

(1) Oil price measured in dollars per barrel

(1) Oil price measured in dollars per barrel (rounded to the nearest $0.01)

(2) Natural gas price measured in dollars per million British thermal units (Btu), or MMBtu

The average rig counts based on the weekly Baker Hughes Company rig count information were as follows:

Three Months Ended Nine Months Ended

Rig count is an indicator of the level of spending for the exploration and production of oil and natural gas reserves and the increase year-over-year are due to similar reasons described above.

The table below shows historical average rig counts based on the weekly Baker Hughes Company rig count information.

Three Months Ended

3/31/2022 12/31/2021 3/31/2021

2 unchanged sentences

Worldwide 1,654 1,536 1,236

Consolidated Statements of Operations - Operating Income Summary

Revenues of $938 million in the three months ended March 31, 2022, increased 13% year-over-year, driven primarily by increased customer activity in DRE and PRI, higher adoption of our technology offerings and greater demand for our services.

Cost of products and services of $682 million in the three months ended March 31, 2022, increased $46 million, or 7%, compared to the three months ended March 31, 2021, primarily reflecting increased customer activity, increased cost for supplies and logistics and impacts from inflation.

Our cost of products and services as a percentage of revenues was 73% in the three months ended March 31, 2022, an improvement compared to 76% in the three months ended March 31, 2021, reflecting increasing volumes, diligent procurement to address inflationary impacts, cost initiative improvements and operational efficiency gains implemented over the past year.

Selling, general, administrative and research and development costs of $199 million in the three months ended March 31, 2022, decreased $10 million, or 5%, compared to the three months ended March 31, 2021, due to cost improvement initiatives to reduce overhead and corporate costs that were implemented during 2021.

These costs as a percentage of revenues were 21% in the three months ended March 31, 2022, an improvement compared to 25% in the three months ended March 31, 2021, also reflecting our focus on simplification.

Operating income of $18 million improved $31 million in the three months ended March 31, 2022 compared to the three months ended March 31, 2021 due to the above-mentioned improvements.

Consolidated Statements of Operations - Non-Operating Expenses Summary

Interest Expense, Net

Interest expense, net was $48 million and $70 million for the first three months ended March 31, 2022 and 2021, respectively, and primarily represented interest on our outstanding long-term debt (see “Note 7 – Borrowings and Other Debt Obligations” to our Condensed Consolidated Financial Statements for additional details).

The year-over-year decrease was due to partial repayments of principal and the refinancing initiatives in the second half of 2021 to reduce our interest rates.

Other Expense, Net

Other expense, net was $16 million for the first three months ended March 31, 2022 compared to $4 million for the first three months ended March 31, 2021.

Other expense, net is comprised of letter of credit fees, other financing charges, and foreign exchange losses.

The year-over-year increase was primarily due to changes in fair value and settlements of certain foreign currency forward contracts.

We enter into these contracts to hedge our exposure to currency fluctuations in certain foreign currencies.

At March 31, 2022 and December 31, 2021, we had outstanding foreign currency forward contracts with notional amounts aggregating to $86 million and $349 million, respectively.

We provide for income taxes based on the laws and rates in effect in the countries in which operations are conducted, or in which we or our subsidiaries are considered resident for income tax purposes.

The relationship between our pre-tax income or loss from continuing operations and our income tax benefit or provision varies from period to period as a result of various factors, which include changes in total pre-tax income or loss, the jurisdictions in which our income is earned, the tax laws in those jurisdictions, the impacts of tax planning activities and the resolution of tax audits.

Our effective rate differs from the Irish statutory tax rate as the majority of our operations are taxed in jurisdictions with different tax rates.

In addition, we are generally unable to recognize tax benefit on our losses.

Please see “Note 11 – Income Taxes” to our Condensed Consolidated Financial Statements for additional details.

Segment Results of Operations

Financial information by segment is summarized below.

(Unfavorable)

Three Months Ended $ %

(Dollars in millions) 3/31/2022 3/31/2021 Change

Drilling and Evaluation $ 292 $ 236 $ 56 24 %

Well Construction and Completions 344 323 21 7 %

Production and Intervention 286 259 27 10 %

Segment Revenues 922 818 104 13 %

All Other 16 14 2 14 %

Total Revenues $ 938 $ 832 $ 106 13 %

Segment Adjusted EBITDA:

Drilling and Evaluation $ 59 $ 29 $ 30 103 %

Well Construction and Completions 67 50 17 34 %

Production and Intervention 39 41 (2) (5) %

Segment Adjusted EBITDA $ 165 $ 120 $ 45 38 %

Corporate and Other (14) (18) 4 22 %

Depreciation and Amortization (87) (111) 24 22 %

Share-based Compensation Expense (7) (4) (3) (75) %

Other Adjustments (39) — (39) n/m

Operating Income (Loss) $ 18 $ (13) $ 31 238 %

Segment Revenues

Segment revenues of $922 million in the three months ended March 31, 2022, increased 13% year-over-year, driven primarily by increased customer activity in DRE and PRI, higher adoption of our technology offerings and greater demand for our services.

DRE revenues of $292 million in the three months ended March 31, 2022, increased 24% compared to the three months ended March 31, 2021 largely due to higher demand for managed pressure drilling and wireline services, primarily in Latin America, and the Middle East/North Africa/Asia (“MENA+ASA”).

WCC revenues of $344 million in the three months ended March 31, 2022, increased 7% compared to the three months ended March 31, 2021 largely due to higher demand for cementation products and activity in North America.

PRI revenues of $286 million in the three months ended March 31, 2022, increased 10% compared to the three months ended March 31, 2021 largely due to higher demand for intervention and pressure pumping services primarily in MENA+ASA and Latin America, respectively.

Segment Adjusted EBITDA

Our primary measure of segment profitability is segment adjusted EBITDA.

Segment adjusted EBITDA was $165 million in the three months ended March 31, 2022, an increase of 38% compared to the three months ended March 31, 2021, primarily due to cost improvement initiatives that were implemented during 2021, increased activity levels, increase in services and product mix, higher adoption of our technology offerings and greater demand for services globally.

DRE segment adjusted EBITDA of $59 million in the three months ended March 31, 2022, increased 103% compared to the three months ended March 31, 2021, largely due to higher demand for managed pressure drilling and drilling services primarily in Latin America.

WCC segment adjusted EBITDA of $67 million in the three months ended March 31, 2022, increased 34% compared to the three months ended March 31, 2021, mostly due to higher demand for cementation and completions products, with improvement primarily in MENA+ASA.

PRI segment adjusted EBITDA of $39 million in the three months ended March 31, 2022, decreased 5% compared to the three months ended March 31, 2021 mainly due to higher logistics costs and supply chain challenges impacting our delivery schedule for products in North America, partially offset by activity improvements in MENA+ASA.

Depreciation and Amortization

Depreciation and amortization was $87 million and $111 million for the first three months ended of 2022 and 2021, respectively.

The year-over-year decrease was primarily from a combination of impairments taken in 2020 during the peak of the COVID-19 pandemic reducing the carrying value of our assets, combined with lower capital expenditures in the periods following the peak.

Share-based Compensation

We record share-based compensation in “Selling, General and Administrative” on the accompanying Consolidated Statements of Operations.

We recognized $7 million and $4 million in the three months ended March 31, 2022 and 2021, respectively.

The year-over-year increase was due to additional awards granted.

Other Adjustments

Other adjustments include $20 million of restructuring charges in the three months ended March 31, 2022 (see “Note 4 - Restructuring Charges” for additional information) and $19 million of other charges, net, primarily related to the write-down of all of our assets in Ukraine, excluding cash.

There were no other adjustments in the three months ended March 31, 2021.

Business Outlook

There are indications that the global economic and demand recovery from the COVID-19 pandemic is continuing to build towards pre-pandemic levels as both COVID-19 vaccination rates and global economic activity increase.

Oil prices have risen during the year, buoyed by supply policies led by the Organization of Petroleum Exporting Countries and the expanded alliance (“OPEC+”) and other high oil exporting non-OPEC+ nations.

Average oil prices for the third quarter of 2021 are approximately 70% higher than the average oil prices for the third quarter of 2020 and natural gas prices have increased 118% over the same period.

WTI oil spot prices have recovered to pre-pandemic levels, averaging approximately $71 per barrel during the third quarter of 2021.

However, the North America and International average rig count continues to be well below pre-pandemic levels.

We expect continued improvements in our customer activity levels with the ongoing COVID-19 vaccine rollout globally and multinational economic stimulus actions which are expected to provide a measured pathway to oil and natural gas demand recovery throughout 2021.

We believe that industry activity will likely continue to recover and our fourth quarter 2021 consolidated revenues are expected to increase by low -single digits above the third quarter of 2021.

We continue to closely monitor the ongoing global impacts surrounding the COVID-19 pandemic, including operational and manufacturing disruptions, logistical constraints and travel restrictions.

The oilfield services industry growth is highly dependent on many external factors, such as the global response to the COVID-19 pandemic, our customers’ capital expenditures, ESG driven business changes, world economic and political conditions, the price of oil and natural gas, member-country quota compliance within the OPEC+, weather conditions and other factors.

COVID-19 Pandemic Impacts

We have experienced and expect to continue to experience inflationary pressures when sourcing raw material and services, delays and supply shortages as our supplier base continues to return to work and reopening challenges.

Shipping and other logistics activities are experiencing tight availability for carriers, containers and shipping materials, exacerbating the delays and lack of availability of key components.

In addition, we continue to experience certain customer restrictions that prevent access to their sites, community measures to contain the spread of the COVID-19 virus, and changes to our policies that have both restricted and changed the way our employees work.

We continuously improve crew rotations and management practices to minimize our employees’ risk of exposure to the COVID-19 virus while at client facilities.

We constantly refine and update our identification and management of COVID-19 cases through the development of updated protocols, advanced testing and response procedures consistent with the latest guidance, from the Centers of Disease Control and Prevention and the World Health Organization.

Faced with these challenges, we evolved our digital portfolio and enhanced our applications to offer fully integrated digital oilfield solutions.

We also increased our offerings of automated well construction and remote monitoring and predictive analytics related to our product offerings.

Growth in the energy services industry is highly dependent on many external factors.

These include but are not limited to, the impact from geopolitical conflicts, the global response to the COVID-19 pandemic, our customers’ capital expenditures, ESG driven changes, world economic, political and weather conditions, the price of oil and natural gas, and member-country quota compliance within the Organization of Petroleum Exporting Countries and the expanded alliance (“OPEC+”).

We expect continued improvements in our customer activity levels with the relaxing of COVID-19 pandemic restrictions and generally improved macroeconomic conditions, all of which are expected to provide a pathway to a multi-year energy demand expansion.

We continue to closely monitor the ongoing operational and manufacturing disruptions, escalating costs, logistical constraints and travel restrictions.

We believe that industry activity will continue to grow, and our 2022 consolidated revenues are anticipated to increase by high single digits to the low-teens above 2021 levels.

Russia Ukraine Conflict

On February 24, 2022, the broad Russia Ukraine Conflict began and in response, we evaluated our operations and have taken a number of actions, with the first being centered on the safety and well-being of our employees in the impacted regions.

Additionally, the United States, the European Union, the United Kingdom and other countries have imposed broad sanctions against Russia, certain Russian individuals and certain activities involving Russia or Russian individuals.

global events continue to evolve rapidly, we continue to monitor and intend to remain in full compliance with the fast evolving sanctions landscape and will continue to fulfill existing contractual obligations within applicable international laws and sanctions.

Revenues in Russia were 6% of our total revenues in the first quarter of 2022.

Excluding cash, net assets in Russia were $106 million as of March 31, 2022, and is comprised of $73 million in current assets, $62 million in property, plant and equipment, $3 million in other non-current assets, and $32 million in liabilities.

Further prolonging or escalation of the conflict and related sanctions may negatively impact our business, potentially lowering revenues or triggering asset impairments.

Opportunities and Challenges

As production decline rates persist and reservoir productivity complexities increase, our customers continue to face challenges in balancing the cost of extraction activities with securing desired rates of production while achieving acceptable rates of return on investment.

These challenges increase our customers’ requirements for technologies that improve productivity and efficiency and puts pressure on us to deliver our products and services at competitive rates.

In addition, as consolidation of the oil and gas services industry continues due to market conditions, there has been an increased demand for companies with specialized products, services and technologies.

We believe we are well positioned to satisfy our customers’ needs, but the level of improvement in our businesses in the future will depend heavily on pricing, volume of work, our ability to offer solutions to more efficiently extract oil and gas while controlling costs, and our success in penetrating new and existing markets with our newly developed technologies.

Over the long-term, we expect the world’s demand for energy to continue rising, requiring increased oil field services and more advanced technology from the oilfield service industry.

These challenges increase our customers’ requirements for technologies that improve productivity and efficiency and pressures us to deliver our products and services at competitive rates.

In addition, as consolidation of the energy services industry continues due to market conditions, there has been an increased demand for companies to provide specialized products, services and technologies.

We believe we are well positioned to satisfy our customers’ needs, but the level of improvement in our businesses in the future will depend heavily on pricing, volume of work, our ability to offer technology solutions to more efficiently extract oil and gas while controlling costs, and our success in penetrating new and existing markets with our newly developed technologies.

Over the long-term, we expect the world’s demand for energy to continue to rise and require more advanced technology from the energy service industry.

We remain focused on delivering innovative and cost-efficient solutions for customers to assist them in achieving their operational, safety and environmental objectives.

Our challenges also include market conditions that could make it more difficult to obtain our targeted cost reduction benefits and to recruit, motivate and retain employees, including key personnel.

Increasing investor and government focus on environmental and social governance factors, the cyclicality of the energy industry and the ongoing COVID-19 pandemic may negatively impact demand for our products and services.

Escalations of sanctions and other events around the Russia Ukraine Conflict, in addition to any other geopolitical events, increasing investor and government focus on ESG factors, the cyclicality of the energy industry and the ongoing but waning COVID-19 pandemic restrictions may negatively impact demand for our products and services.

We are following our long-term strategy aimed at achieving sustainable profitability in our businesses, servicing our customers and creating value for our shareholders.

Our long-term success will be determined by our ability to manage effectively the cyclicality of our industry, including potential prolonged industry downturns, our ability to respond to industry demands in periods of over-supply or uncertain oil prices, and ultimately to generate consistent positive cash flow and positive returns on the invested capital.

Results of Operations

The following table sets forth consolidated results of operations and financial information by operating segment and other selected information for the periods indicated.

Three Months Ended (Unfavorable)

(Dollars and shares in millions, except per share data) 09/30/21 09/30/20 $ Change % Change

Western Hemisphere $ 441 $ 316 $ 125 40 %

Eastern Hemisphere 504 491 13 3 %

Total Revenues 945 807 138 17 %

Operating Income (Loss):

Western Hemisphere 45 (2) 47 2,350 %

Eastern Hemisphere 34 5 29 580 %

Total Segment Operating Income 79 3 76 2,533 %

Corporate (16) (28) 12 43 %

Total Operating Income (Loss) Before Other Operating Expenses 63 (25) 88 352 %

Restructuring Charges — (31) 31 100 %

Other (Charges) Credits, Net 8 (4) 12 300 %

Total Operating Income (Loss) 71 (60) 131 218 %

Interest Expense, Net (69) (64) (5) (8) %

Loss on Extinguishment of Debt and Bond Redemption Premium (59) — (59) — %

Loss on Termination of ABL Credit Agreement — (15) 15 100 %

Other Expense, Net (4) (20) 16 80 %

Loss Before Income Taxes (61) (159) 98 62 %

Income Tax Provision (28) (8) (20) (250) %

Net Loss $ (89) $ (167) $ 78 47 %

Net Income Attributable to Noncontrolling Interests 6 7 1 14 %

Net Loss Attributable to Weatherford $ (95) $ (174) $ 79 45 %

Net Loss per Diluted Share $ (1.36) $ (2.48) $ 1.12 45 %

Weighted Average Diluted Shares Outstanding 70 70 N/A N/A

Depreciation and Amortization $ 112 $ 117 $ 5 4 %

Nine Months Ended (Unfavorable)

(Dollars and shares in millions, except per share data) 9/30/2021 9/30/2020 $ Change % Change

Western Hemisphere $ 1,256 $ 1,214 $ 42 3 %

Eastern Hemisphere 1,424 1,629 (205) (13) %

Total Revenues 2,680 2,843 (163) (6) %

Operating Income (Loss):

Western Hemisphere 97 4 93 2,325 %

Eastern Hemisphere 21 38 (17) (45) %

Total Segment Operating Income 118 42 76 181 %

Corporate (51) (80) 29 36 %

Total Operating Income (Loss) Before Other Operating Expenses 67 (38) 105 276 %

Goodwill and Long-Lived Asset Impairments — (1,057) 1,057 100 %

Restructuring Charges — (114) 114 100 %

Other (Charges) Credits, Net 16 (170) 186 109 %

Total Operating Income (Loss) 83 (1,379) 1,462 106 %

Interest Expense, Net (211) (181) (30) (17) %

Loss on Extinguishment of Debt and Bond Redemption Premium (59) — (59) — %

Loss on Termination of ABL Credit Agreement — (15) 15 100 %

Other Expense, Net (19) (65) 46 71 %

Loss Before Income Taxes (206) (1,640) 1,434 87 %

Income Tax Provision (66) (64) (2) (3) %

Net Loss (272) (1,704) 1,432 84 %

Net Income Attributable to Noncontrolling Interests 17 17 — — %

Net Loss Attributable to Weatherford $ (289) $ (1,721) $ 1,432 83 %

Net Loss per Diluted Share $ (4.13) $ (24.58) $ 20.45 83 %

Weighted Average Diluted Shares Outstanding 70 70 N/A N/A

Depreciation and Amortization $ 337 $ 387 $ 50 13 %

Segment Revenues

Western Hemisphere revenues increased $125 million, or 40%, in the third quarter of 2021 and $42 million, or 3%, in the first nine months of 2021 compared to the third quarter and first nine months of 2020.

The third quarter of 2021 year-over-year growth in the Western Hemisphere was due to increased demand for service and products across both C&P and DEI in North America and South America.

Western Hemisphere growth was primarily driven by higher business activity levels for C&P services and products primarily in Canada, Argentina and the United States.

The Western Hemisphere revenue improvement in the first nine months of 2021 compared to 2020 was due to higher business activity levels for C&P services and products.

Eastern Hemisphere revenues increased $13 million, or 3%, in the third quarter of 2021 and decreased $205 million, or 13%, in the first nine months of 2021 compared to the third quarter and first nine months of 2020.

The third quarter of 2021 year-over-year increase was due to increased demand for the DEI services in MENA/Asia.

The nine months of 2021 year-over-year decrease was due to a decline in international activity resulting in lower C&P and DEI service and product sales since the COVID-19 pandemic.

Segment Operating Results

Western Hemisphere segment operating income of $45 million and $97 million in the third quarter and first nine months 2021, respectively, increased $47 million and $93 million, respectively, compared to the third quarter and first nine months of 2020.

The third quarter year-over-year improvements were driven by the increased demand for services across both C&P and DEI businesses in North and South America, as well as lower operational and employee costs.

The nine months year-over-year improvements were driven by the increased demand for C&P services in North and South America, as well as lower operational and employee costs.

Eastern Hemisphere segment operating income of $34 million and $21 million in the third quarter and first nine months of 2021, respectively, increased $29 million and decreased $17 million, respectively, compared to the third quarter and first nine months of 2020.

The third quarter year-over-year improvement was driven by the improved services mix across both the C&P and DEI businesses in MENA/Asia.

The year-over-year decline in the nine months was driven by lower activity levels across for C&P and DEI services related to the COVID-19 pandemic, partially offset by lower operational and employee costs.

Interest Expense, Net

Net interest expense was $69 million and $211 million in the third quarter and first nine months of 2021, respectively, and primarily represents interest on our 11.0% Exit Notes due 2024 (“Exit Notes”) and our 8.75% Senior Secured Notes due 2024 (“2024 Senior Secured Notes”) as well as amortization of debt issuance costs and discounts.

Net interest expense was $64 million and $181 million in the third quarter and first nine months of 2020, respectively, and primarily represents interest on our Exit Notes and our 2024 Senior Secured Notes.

Loss on Termination of ABL Credit Agreement

On December 13, 2019, we entered into a senior secured asset-based lending agreement in an aggregate amount of $450 million (the “ABL Credit Agreement”) which was terminated on August 28, 2020.

Upon its termination, we recorded $15 million of noncash “Loss on Termination of ABL Credit Agreement” on our Condensed Consolidated Financial Statements related to unamortized deferred debt issuance costs.

Loss on Extinguishment of Debt and Bond Redemption Premium

On September 30, 2021, we repaid our 2024 Senior Secured Notes and recognized a $22 million bond redemption premium on the early redemption and a $37 million noncash loss on extinguishment of debt related to unamortized debt issuance costs and discount, which is presented as “Loss on Extinguishment of Debt and Bond Redemption Premium” on the Condensed Consolidated Statements of Operations.

Other Expense, Net

Other expense, net was $4 million and $19 million in the third quarter and first nine months of 2021, respectively, compared to other expense of $20 million and $65 million in the third quarter and first nine months of 2020, respectively.

Other expense, net is comprised of letter of credit fees, other financing charges and foreign exchange losses, primarily attributed to currency losses in countries with no or limited markets to hedge.

The first nine months year-over-year improvement was primarily due to lower currency volatility in 2021 compared to the significant volatility in the same period in the prior year following the start of the COVID-19 pandemic.

In 2020, the balance included $9 million in reorganization expenses.

In the three and nine months ended September 30, 2021, we recognized tax expense of $28 million and $66 million, respectively, on a loss before income taxes of $61 million and $206 million, respectively, compared to the three and nine months ended September 30, 2020 where we recognized tax expense of $8 million and $64 million, respectively, on a loss before income taxes of $159 million and $1.6 billion, respectively.

Our income tax provisions are primarily driven by income in certain jurisdictions, deemed profit countries and withholding taxes on intercompany and third-party transactions that do not directly correlate to ordinary income or loss and other adjustments.

Impairments and other charges recognized do not result in significant tax benefit as a result of our inability to forecast realization of the tax benefit of such losses.

Please see “Note 13 – Income Taxes” to our Condensed Consolidated Financial Statements for additional details.

Restructuring, Facility Consolidation and Severance Charges

Please see “Note 6 – Restructuring, Facility Consolidation and Severance Charges” to our Condensed Consolidated Financial Statements for additional details of our charges by segment.

Liquidity and Capital Resources

At September 30, 2021, we had total cash and cash equivalents and restricted cash of $1.45 billion, which increased $161 million compared to the year ended December 31, 2020.

Included in total cash and cash equivalents was $155 million and $167 million of restricted cash at September 30, 2021 and December 31, 2020, respectively.

Restricted cash is primarily cash collateral for letters of credit not held under the senior secured letter of credit agreement (the “LC Credit Agreement”).

The following table summarizes cash flows provided by (used in) each type of activity and a reconciliation of operating cash flow to non-GAAP free cash flow for the nine months ended September 30, 2021 and September 30, 2020:

Nine Months Ended September 30,

At March 31, 2022, we had total cash and cash equivalents plus restricted cash of $1.1 billion, of which $215 million was restricted cash, compared to $1.1 billion at December 31, 2021, of which $162 million was restricted cash.

The following table summarizes cash flows provided by (used in) each type of business activity in the periods presented:

Three Months Ended March 31,

(Dollars in millions) 2022 2021

Net Cash Provided by Operating Activities $ 234 $ 188

Net Cash Used in Investing Activities (2) (65)

Net Cash Provided by (Used in) Financing Activities (65) 376

Reconciliation of Operating Cash Flow to Non-GAAP Free Cash Flow:

Net Cash Provided by Operating Activities $ 234 $ 188

Capital Expenditures for Property, Plant and Equipment (44) (100)

Proceeds from Disposition of Assets 39 13

Non-GAAP Free Cash Flow $ 229 $ 101

Net Cash Provided by (Used in) Operating Activities $ (64) $ 74

Net Cash Provided by (Used in) Investing Activities $ 9 $ (3)

Net Cash Used in Financing Activities $ (5) $ (9)

Operating Activities

Cash provided by operating activities was $234 million for the nine months ended September 30, 2021 compared to $188 million for the nine months ended September 30, 2020.

During the nine months ended September 30, 2021, the primary sources of cash provided by operating activities were driven by higher operating income and lower accounts payable spend partially offset by higher interest payments.

During the nine months ended September 30, 2020, the primary sources of cash provided by operating activities were from collections on our accounts receivable, and lower payments for working capital activities, retention and performance cash bonuses, partially offset by payments for interest.

Cash used in operating activities was $64 million for the three months ended March 31, 2022.

The primary uses of cash in operating activities were from seasonal working capital requirements.

Cash provided by operating activities was $74 million for the three months ended March 31, 2021.

The primary sources of cash provided by operating activities were driven by collections on our accounts receivables and inventory utilization, partially offset by higher interest payments.

Investing Activities

Cash used in investing activities was $2 million for the nine months ended September 30, 2021 compared to $65 million for the nine months ended September 30, 2020.

During the nine months ended September 30, 2021, the primary uses of cash

were capital expenditures of $44 million for property, plant and equipment, offset by proceeds of $39 million from asset dispositions.

During the nine months ended September 30, 2020, the primary uses of cash were capital expenditures of $100 million for property, plant and equipment, offset by proceeds of $13 million from asset dispositions and $25 million of cash proceeds from Angolan government bonds.

Cash provided by investing activities was $9 million for the three months ended March 31, 2022.

The primary investing activities included proceeds from a settlement of escrow related to the sale of business for $9 million, cash used for capital expenditures of $20 million, which was offset by proceeds from sale of assets of $20 million.

Cash used in investing activities was $3 million for the three months ended March 31, 2021.

The primary uses of cash in investing activities were capital expenditures of $15 million for property, plant and equipment, offset by proceeds of $11 million from other asset dispositions.

Financing Activities

Cash used in financing activities was $65 million for the nine months ended September 30, 2021 compared to cash provided by financing activities of $376 million for the nine months ended September 30, 2020.

During the nine months ended September 30, 2021, the primary uses of cash were repayments of long-term debt of $510 million primarily for the repayment of our 2024 Senior Secured Notes and finance lease obligations, a $22 million bond redemption premium payment for the early redemption of our 2024 Senior Secured Notes, and $20 million primarily for dividends paid to noncontrolling interests.

The primary sources of cash were net proceeds of $491 million, net of commitments fees and debt issuance costs, from the issuance of the 2028 Senior Secured Notes.

See “Note 7 – Borrowings and Other Obligations” to our Condensed Consolidated Financial Statements for further details on the debt financing.

During the nine months ended September 30, 2020, the primary source of cash were net proceeds of $457 million from the issuance of our 2024 Senior Secured Notes, offset by uses of cash of $81 million for the repayment of short-term debt and other financing activities related to a deferred payment for our 2018 acquisition of our Qatari joint venture and dividends paid to noncontrolling interests.

Non-GAAP Free Cash Flow

Non-GAAP free cash flow (“free cash flow”) represents cash provided by operating activities less capital expenditures for property, plant and equipment plus proceeds from the disposition of assets.

It is a non-GAAP financial measure that should be considered in addition to, not as substitute for or superior to, cash provided by operating activities.

Management believes that free cash flow is useful to investors and management as an important operating liquidity measure and is an indicator of our ability to generate cash, pay obligations, reinvest in the business and create shareholder value.

Cash provided by operating activities was $234 million and $188 million in the nine months ended September 30, 2021 and 2020, respectively.

Free cash flow was a positive $229 million and $101 million in the nine months ended September 30, 2021 and 2020, respectively.

Cash used in financing activities was $5 million for the three months ended March 31, 2022.

The primary uses of cash in financing activities were for finance lease payments.

Cash used in financing activities was $9 million for the three months ended March 31, 2021.

The primary uses of cash in financing activities were for finance lease payments.

Sources of Liquidity

Our sources of available liquidity include cash generated by our operations, cash and cash equivalent balances, accounts receivable factoring, and dispositions of businesses or capital assets that no longer fit our long-term strategy.

Our sources of available liquidity include cash generated by our operations, cash and cash equivalent balances, and accounts receivable factoring.

From time to time, we may enter into transactions to dispose of businesses or capital assets that no longer fit our long-term strategy.

We historically have accessed banks for short-term loans and the capital markets for debt and equity offerings.

Based upon current and anticipated levels of operations and our recently completed and announced anticipated long-term debt refinancing, we believe we have sufficient cash from operations and cash on hand to fund our expected financial obligations and cash requirements (discussed below) both in the short-term and long-term.

LC Credit Agreement Amendment

The LC Credit Agreement is a senior secured letter of credit agreement in an aggregate amount of $215 million maturing on May 29, 2024, which is used by the Company and certain of its subsidiaries for the issuance of bid and performance letters of credit.

On September 20, 2021, certain provisions and covenants of the LC Credit Agreement were amended as follows:

• Permit the borrowing of up to an additional $400 million of secured indebtedness under an asset-based lending facility or a revolving credit facility upon compliance with certain conditions;

• Removed the minimum secured liquidity requirement;

• Increased the minimum aggregate liquidity requirement from $175 million to $300 million;

• Decreased the minimum aggregate book value of certain pledged assets requirement from $1.25 billion to $1 billion;

• Increased the ability to redeem debt to $500 million subject to a minimum aggregate liquidity of $400 million

at the time of redemption.

2028 Senior Secured Notes

On September 30, 2021, we entered into an indenture and issued the 6.5% Senior Secured Notes in aggregate principal amount of $500 million maturing September 15, 2028 (the “2028 Senior Secured Notes”).

Interest accrues at the rate of 6.5% per annum and is payable semiannually on September 15 and March 15 of each year, commencing on March 15, 2022.

The 2028 Senior Secured Notes are guaranteed by the Company and the same subsidiaries that guaranteed the 2024 Senior Secured Notes.

Exit Notes Redemption

On October 20, 2021 we redeemed $200 million of our Exit Notes and paid related accrued interest of $8 million with an early bond redemption premium of $6 million.

2030 Senior Notes and Exit Notes Redemption

On October 27, 2021, we issued $1.6 billion of 8.625% senior notes due April 30, 2030 (the “2030 Senior Notes”).

The net proceeds and cash on hand were used to redeem $1.6 billion in principal of our Exit Notes at applicable prices, plus accrued and unpaid interest.

The 2030 Senior Notes pay interest semi-annually on June 1 and December 1 of each year, beginning on June 1, 2022 at a rate of 8.625% per year and will mature on April 30, 2030.

The 2030 Senior Notes are guaranteed by the Company and the same subsidiaries that guaranteed the 2028 Senior Secured Notes.

Based upon current and anticipated levels of operations and our recent refinancing transactions, we expect to have sufficient cash from operations and cash on hand to fund our cash requirements (discussed below) and financial obligations, both in the short-term and long-term.

Our cash and cash equivalents of $841 million (which excludes restricted cash) remain our primary source of funds to manage any liquidity event risks.

LC Credit Agreement

We have a senior secured letter of credit agreement (the “LC Credit Agreement”) in an aggregate amount of $215 million maturing on May 29, 2024, which is used by the Company and certain of its subsidiaries for the issuance of bid and performance letters of credit.

At March 31, 2022, we had approximately $169 million in outstanding letters of credit under the LC Credit Agreement (“LC Credit Agreement letters of credit”) and availability of $46 million.

Ratings Services’ Credit Ratings

Our credit ratings at March 31, 2022 were maintained since December 31, 2021.

• Moody’s Investors Service (“Moody’s”) corporate family rating is at B2, our senior unsecured notes rating is at B3, and our senior secured notes and LC Credit Agreement ratings are at Ba3.

The outlook is stable.

• Standard and Poor’s (“S&P”) corporate family and senior unsecured notes ratings are at B-, and our senior secured notes and LC Credit Agreement ratings are B+.

The outlook is stable.

Cash Requirements

Our cash requirements will continue to include interest payments on our long-term debt, payments for capital expenditures, repayment on finance leases, payments for short-term working capital needs and costs associated with our revenue and restructuring payments, including severance.

During 2020, we accumulated working capital due to the sharp decrease in demand due to the COVID-19 pandemic.

Our cash requirements will continue to include payments for capital expenditures, payments for short-term working capital needs, interest payments on our long-term debt, repayment on finance leases, operating costs associated with our business and restructuring payments.

In 2021, operating cash flow benefited from the monetization of working capital accumulated in 2020.

As business activity rises to pre-COVID-19 pandemic levels we expect that we will utilize cash to invest in capital assets and inventory.

As business activity rises to pre-COVID-19 pandemic levels we expect that we will utilize cash to invest in capital assets and working capital growth.

Our cash requirements may also include awards under our employee incentive programs and other amounts to settle litigation related matters.

As of September 30, 2021, we had $2.1 billion in aggregate principal amount maturing on December 1, 2024 and $500 million in aggregate principal amount maturing on September 15, 2028 for our Exit Notes and 2028 Senior Secured Notes, respectively.

In addition, on October 20, 2021 we redeemed $200 million of our Exit Notes and on October 27, 2021, we issued $1.6 billion in aggregate principal amount of the 2030 Senior Notes with an interest rate of 8.625%.

We used the net proceeds from the 2030 Senior Notes issuance and cash on hand to redeem $1.6 billion principal amount of our Exit Notes.

Please see “Note 7 – Borrowings and Other Obligations” and “Note 14 – Subsequent Events” to our Condensed Consolidated Financial Statements for additional details.

Prior to refinancing of our Exit Notes and 2024 Secured Senior Notes we expected to make annual interest payments of approximately $275 million until their maturity.

Subsequent to refinancing our Exit Notes and the 2024 Secured Notes, we expect to make annual interest payments of approximately $204 million until their maturity.

Our 2021 payments on operating leases are expected to be $91 million and capital spending is expected to be approximately $100 - $110 million.

Cash and cash equivalents (including restricted cash of $155 million primarily related to cash collateral on our letters of credit) totaled $1.45 billion at September 30, 2021 and are held by subsidiaries outside of Ireland.

At September 30, 2021 we had approximately $195 million of our cash and cash equivalents that cannot be immediately repatriated from various countries due to country central bank controls or other regulations.

As of March 31, 2022, we had outstanding debt of $300 million in aggregate principal amount for our Exit Notes due 2024, $500 million in aggregate principal amount for our 2028 Senior Secured Notes and $1.6 billion in aggregate principal amount of the 2030 Senior Notes.

Please see “Note 7 – Borrowings and Other Debt Obligations” for additional details.

Our capital spending for 2022 is currently projected to be between $175 million to $200 million.

Capital expenditures are expected to be used primarily to support the ongoing activities and commitments in our core business.

We expect to make $215 million in interest payments in 2022 and approximately $204 million in interest payments annually until the maturity of our long-term debt (excluding finance leases).

Our payments on operating leases and operating purchase obligations this year are expected to be approximately $74 million and $177 million, respectively.

Cash and cash equivalents plus restricted cash are held by subsidiaries outside of Ireland.

At March 31, 2022 we had approximately $168 million of our cash and cash equivalents that cannot be immediately repatriated from various countries due to country central bank controls or other regulations.

Based on the nature of our structure, other than the restrictions noted above, we foresee we will be able to redeploy cash with minimal to no incremental tax.

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Accounts Receivable Factoring

From time to time, we participate in factoring arrangements to sell accounts receivable to third-party financial institutions or cash proceeds net of discount and hold-back.

From time to time, we participate in factoring arrangements to sell accounts receivable to third-party financial institutions for cash proceeds net of discount and hold-back.

The programs we factor under are uncommitted and thus we cannot assure they will be available as a source of liquidity.

Our factoring transactions in the three and nine months ended September 30, 2021 and 2020 were recognized as sales of accounts receivable, and the proceeds are included as operating cash flows in our Condensed Consolidated Statements of Cash Flows.

During the three and nine months ended September 30, 2021, we received cash proceeds from the sale of accounts receivable of $12 million and $46 million, respectively, compared to $10 million and $30 million in the three and nine months ended September 30, 2020, respectively.

Ratings Services’ Credit Ratings

On July 1, 2021, the Standard and Poor’s (“S&P”) credit ratings of our 2024 Senior Secured Notes and the LC Credit Agreement improved to a B with a stable outlook.

The S&P credit rating of our Exit Notes improved to a CCC+ with a stable outlook.

On October 12, 2021, S&P placed our issuer credit rating on CreditWatch with positive implications related to our refinancing of a substantial portion of our Exit Notes.

On October 12, 2021, Moody’s Investor Services (“Moody’s”) changed its outlook for the Company to stable from negative and assigned a B3 rating to our new 2030 Senior Unsecured Notes.

The ratings on our other debt remained unchanged including a Ba3 credit rating on the 2028 Senior Secured Notes and the LC Credit Agreement, B3 on our Exit Notes, and a B2 long-term corporate family rating.

Off Balance Sheet Arrangements

Weatherford International plc, a public limited company organized under the laws of Ireland, and as the ultimate parent of the Weatherford group, guarantees the obligations of its subsidiaries.

Please see our discussion on guarantees in “Part II - Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operation” of our Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Annual Report”).

Our factoring transactions were recognized as sales, and the proceeds are included as operating cash flows in our Condensed Consolidated Statements of Cash Flows.

During the three months ended March 31, 2022 and 2021, we sold accounts receivable balances of $17 million and $6 million, respectively, and received cash proceeds of $15 million and $5 million, respectively.

Weatherford International plc, the ultimate parent of the Weatherford group, guarantees the obligations of its subsidiaries – Weatherford International Ltd., a Bermuda exempted company (“Weatherford Bermuda”), and Weatherford International, LLC, a Delaware limited liability company (“Weatherford Delaware”), including the notes and credit facilities listed below.

Our Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes were issued by Weatherford Bermuda and guaranteed by Weatherford International plc and Weatherford Delaware and other subsidiary guarantors party thereto.

Please see “Note 7 – Borrowings and Other Debt Obligations” for additional details.

Letters of Credit and Surety Bonds

As of September 30, 2021, we had $329 million of letters of credit outstanding, consisting of $173 million under the LC Credit Agreement and $156 million under various bi-lateral uncommitted facilities (for which there was $152 million in cash collateral held and recorded in “Restricted Cash” on our Condensed Consolidated Balance Sheets).

As of September 30, 2021, we had outstanding surety bonds of $287 million, which were primarily in Latin America where we utilize surety bonds as part of our customary business practice.

As of March 31, 2022, we had $382 million of letters of credit outstanding, consisting of the $169 million under the LC Credit Agreement letters of credit and another $213 million under various uncommitted bi-lateral facilities (of which there was $212 million in cash collateral held and recorded in “Restricted Cash” on the Condensed Consolidated Balance Sheets).

Our letters of credit under various uncommitted bi-lateral facilities increased “Restricted Cash” since December 31, 2021 due to a requirement from a new multi-year contract.

We utilize surety bonds as part of our customary business practice in Latin America.

As of March 31, 2022, we had surety bonds outstanding of $300 million.

Any of our outstanding letters of credit or surety bonds could be called by the beneficiaries should we breach certain contractual or performance obligations.

If the beneficiaries were to call the letters of credit under our LC Credit Agreement or our surety bonds, our available liquidity would be reduced by the amount called.

If the beneficiaries were to call the letters of credit under our LC Credit Agreement or surety bonds, our available liquidity would be reduced by the amount called.

Forward-Looking Statements

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Accordingly, our actual outcomes and results may differ materially from what we have expressed or forecasted in the forward-looking statements.

We undertake no obligation to correct, update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.

The forward-looking statements included herein are only made as of the date of the filing of this report, and we undertake no obligation to correct, update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.

The following, together with disclosures under “Part II – Other Information – Item 1A.

Risk Factors”, sets forth certain risks and uncertainties relating to our forward-looking statements that may cause actual results to be materially different from our present expectations or projections:

• risks associated with disease outbreaks and other public health issues, including COVID-19 and COVID-19 variants, their impact on the global economy and the business of our Company, customers, suppliers and other partners, changes in, and the administration of, treaties, laws, and regulations, including in response to such issues and the potential for such issues to exacerbate other risks we face, including those related to the factors listed or referenced below;

• further spread and potential for a resurgence of COVID-19 in a given geographic region and related disruptions to our business, customers, suppliers and other partners and additional regulatory measures or voluntary actions that may be put in place to limit the spread of COVID-19, including vaccination requirements and the associated availability of vaccines, restrictions on business operations or social distancing requirements, and the duration and efficacy of such restrictions;

• global political, economic and market conditions, political disturbances, war, terrorist attacks, changes in global trade policies, weak local economic conditions and international currency fluctuations (including the Russia Ukraine Conflict;

• failure to ensure on-going compliance with current and future laws and government regulations and sanctions, including but not limited to those related to the Russia Ukraine Conflict, and environmental and tax and accounting laws, rules and regulations;

• changes in, and the administration of, treaties, laws, and regulations, including in response to issues related to the Russia Ukraine Conflict and the potential for such issues to exacerbate other risks we face, including those related to the other risks and uncertainties listed or referenced in this Forward-Looking Statements section and in the Risk Factors section below;

• our ability to comply with, and respond to, climate change, ESG and other “sustainability” initiatives and future legislative and regulatory measures both globally and in the specific geographic regions in which we and our customers operate;

• our ability to effectively and timely address the need to conduct our operations and provision of services to our customers more sustainably and with a lower carbon footprint;

• risks associated with disease outbreaks and other public health issues, including the COVID-19 pandemic, their impact on the global economy and the business of our company, customers, suppliers and other partners;

• further spread and potential for a resurgence of the COVID-19 pandemic in a given geographic region and related disruptions to our business, employees, customers, suppliers and other partners and additional regulatory measures or voluntary actions that may be put in place to limit the spread of the COVID-19 pandemic, including vaccination requirements and the associated availability of vaccines, restrictions on business operations or social distancing requirements, and the duration and efficacy of such restrictions;

• the price and price volatility of, and demand for, oil, natural gas and natural gas liquids;

• member-country quota compliance within the Organization of Petroleum Exporting Countries and the expanded alliance;

• member-country quota compliance within the Organization of Petroleum Exporting Countries (“OPEC”);

• our ability to realize expected revenues and profitability levels from current and future contracts;

• our ability to generate cash flow from operations to fund our operations;

• our ability to effectively and timely adapt our technology portfolio, products and services to address and participate in changes to the market demands for the transition to alternate sources of energy such as geothermal, carbon capture and responsible abandonment, including our digitalization efforts;

• increases in the prices and lack of availability of our procured products and services;

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• our ability to attract, motivate and retain employees, including key personnel;

• our ability to access capital markets on terms that are commercially acceptable to the Company, or at all;

• our ability to access to capital markets on terms that are commercially acceptable to the Company;

• our ability to manage our workforce, supply chain and business processes, information technology systems and technological innovation and commercialization, including the impact of our organization restructure, business enhancements, improvement efforts and the cost and support reduction plans;

• our ability to service our debt obligations;

• potential non-cash asset impairment charges for long-lived assets, intangible assets or other assets;

• adverse weather conditions in certain regions of our operations.

• failure to ensure on-going compliance with current and future laws and government regulations, including but not limited to environmental, social, governance and tax and accounting laws, rules and regulations as well as stock exchange listing rules.

Many of these factors are macro-economic in nature and are, therefore, beyond our control.

Should one or more of these risks or uncertainties materialize, affect us in ways or to an extent that we currently do not expect or consider to be significant, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in this quarterly report as anticipated, believed, estimated, expected, intended, planned or projected.

Finally, our future results will depend upon various other risks and uncertainties, including, but not limited to, those detailed in our other filings with the SEC under the Exchange Act and the Securities Act.

For additional information regarding

risks and uncertainties, see our other filings with the SEC.

In the event of an inconsistency between any prior or current SEC filing, the most current SEC filing would control.

Should one or more of these risks or uncertainties materialize, affect us in ways or to an extent that we currently do not expect or consider to be significant, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in this report as anticipated, believed, estimated, expected, intended, planned or projected.

Finally, our future results will depend upon various other risks and uncertainties, including, but not limited to, those detailed in our current and past filings with the SEC under the Exchange Act and the Securities Act of 1933, as amended.

Quantitative and Qualitative Disclosures About Market Risk.

Other than the recent debt refinancing and change in the fair value of our debt as discussed in “Note 7 – Borrowings and Other Obligations” to our Condensed Consolidated Financial Statements, our exposure to market risk has not changed materially since December 31, 2020.

Other than the change in fair value of our debt as discussed in “Note 7 – Borrowings and Other Debt Obligations” in the Notes to Condensed Consolidated Financial Statements, our exposure to market risk has not changed materially since December 31, 2021.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis