SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): January 29, 2004
SCHLUMBERGER N.V.
(SCHLUMBERGER LIMITED)
(Exact name of registrant as specified in its charter)
| Netherlands Antilles | 1-4601 | 52-0684746 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 153 East 53rd Street, 57th Floor New York, New York |
10022-4624 | |
| 42, rue Saint-Dominique Paris, France |
75007 | |
| Parkstraat 83, The Hague, The Netherlands |
2514 JG | |
| (Address of principal executive offices) | (Zip or Postal Codes) | |
Registrant’s telephone number in the United States, including area code: (212) 350-9400
The Company is filing this amendment to its Current Report on Form 8-K filed on January 30, 2004 to furnish updated pro forma financial information prepared in accordance with Article 11 of Regulation S-X with respect to the sale of the SchlumbergerSema business. Pro forma financial information was previously reported in the Current Report on Form 8-K filed on October 16, 2003.
Items 2 and 5. Acquisition of Disposition of Assets; Other Events and Regulation FD Disclosure.
On January 29, 2004, Schlumberger completed the sale of its SchlumbergerSema businesses to Atos Origin SA. The consideration for the transaction consisted of €443 million in cash, which included a working capital adjustment, and 19.3 million shares of Atos capital stock valued at €52.65, and was determined by arm’s length negotiation. Prior to the transaction there was no material relationship between Atos Origin and Schlumberger (or any of Schlumberger’s affiliates, directors or officers or any of their associates). On February 2, 2004, the Schlumberger group sold 9.6 million Atos Origin shares at a price of €52.95 per share. As a result, the Schlumberger group holds approximately 14.5% of the share capital of Atos Origin. Schlumberger accounts for its investment in Atos Origin using the cost method. Schlumberger expects to sell these remaining shares in a large block.
SchlumbergerSema provided IT consulting, systems integration and managed services together with network and infrastructure solutions to the global energy industry, as well as in specific regional markets spanning the telecommunications, finance, transport and public sectors. Schlumberger is retaining the strategic activities of IT services for the oil and gas industry and the operations that provide connectivity with the upstream oil and gas business. Additionally, Schlumberger also retained specific SchlumbergerSema businesses, which are in the process of divestiture, including Business Continuity, Infodata, and Telecom Software Products.
Item 7. Financial Statements and Exhibits.
(b) Pro forma financial information
The following unaudited pro forma financial statements and notes thereto are being filed herewith:
| (1) | Unaudited Condensed Pro Forma Balance Sheet as of December 31, 2003; and |
| (2) | Unaudited Condensed Pro Forma Statement of Operations for the year ended December 31, 2003. |
On January 29, 2004, Schlumberger completed the sale of its SchlumbergerSema businesses to Atos Origin SA. The consideration for the transaction consisted of €443 million in cash, which included a working capital adjustment, and 19.3 million shares of Atos capital stock valued at €52.65, and was determined by arm’s length negotiation. Prior to the transaction there was no material relationship between Atos Origin and Schlumberger (or any of Schlumberger’s affiliates, directors or officers or any of their associates). Shortly after completion of the sale, the Schlumberger group sold 9.6 million Atos Origin shares at a price of €52.95 per share. As a result, the Schlumberger group holds approximately 14.5% of the share capital of Atos Origin. Schlumberger accounts for its investment in Atos Origin using the cost method. Schlumberger expects to sell these remaining shares in a large block.
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The Unaudited Condensed Pro Forma Statements of Operations below have been prepared as if the transactions were completed on January 1, 2003. The Unaudited Condensed Pro Forma Balance Sheet has been prepared as if the transactions were completed on December 31, 2003. The pro forma financial information represents, in the opinion of management, all adjustments necessary to present Schlumberger’s pro forma results of operations and financial position in accordance with Article 11 of Regulation S-X and is based upon available information and certain assumptions considered reasonable under the circumstances. Cash proceeds, net of expenses, from the disposition of SchlumbergerSema and from the sale of the Atos Origin stock aggregate approximately $1.0 billion of which $0.6 billion is invested in short-term investments and $0.4 billion is used to pay down current portion of long-term debt.
The pro forma financial statements give effect to the transaction with Atos Origin as well as the sale of 9.6 million shares of Atos Origin on February 2, 2004. The following pro forma information has been prepared based on (i) the value of the Atos Origin stock at January 29, 2004 and February 2, 2004 (ii) the discount that Schlumberger believes would be necessary to sell the remaining Atos Origin shares in a large block in 2004 (iii) the currency exchange rates at January 29, 2004 and February 2, 2004 and (iv) other adjustments deemed to give effect to the transaction as if the transaction was completed as discussed above.
The pro forma condensed financial statements should be read in conjunction with Schlumberger’s audited consolidated financial statements and notes thereto included in Schlumberger’s Annual Report on Form 10-K for the year ended December 31, 2003.
The pro forma information may not necessarily be indicative of what Schlumberger’s financial position or results of operations would have been had the transaction been in effect as of and for the periods presented, nor is such information necessarily indicative of Schlumberger’s results of operations or financial position for any future period or date.
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The following table shows the unaudited condensed pro forma balance sheet at December 31, 2003 as if the transactions had taken place on December 31, 2003:
SCHLUMBERGER
UNAUDITED CONDENSED PRO FORMA BALANCE SHEET
As of December 31, 2003
| (Amounts in thousands of US Dollars) |
|||||||||||||||
| Historical |
Adjustments |
Pro Forma Schlumberger |
|||||||||||||
| Schlumberger |
SchlumbergerSema |
||||||||||||||
| Cash & Cash Equivalents |
$ | 3,108,973 | $ | — | $ | 600,000 | (1) | $ | 3,708,973 | ||||||
| Accounts Receivable |
2,568,425 | — | — | 2,568,425 | |||||||||||
| Assets held for Sale |
3,237,841 | 3,237,841 | — | — | |||||||||||
| Other Current Assets |
1,453,882 | — | — | 1,453,882 | |||||||||||
| Total Current Assets |
10,369,121 | 3,237,841 | 600,000 | 7,731,280 | |||||||||||
| Fixed Income Investments, held to maturity |
223,300 | — | — | 223,300 | |||||||||||
| Investments in Affiliated Companies |
776,965 | — | 587,311 | (2) | 1,364,276 | ||||||||||
| Property and Equipment, net |
3,799,711 | — | — | 3,799,711 | |||||||||||
| Multiclient Seismic Data |
505,784 | — | — | 505,784 | |||||||||||
| Goodwill and Identifiable Intangibles |
3,687,573 | — | — | 3,687,573 | |||||||||||
| Other Assets |
678,872 | — | — | 678,872 | |||||||||||
| Total Assets |
$ | 20,041,326 | $ | 17,990,796 | |||||||||||
| Current Liabilities |
$ | 5,577,162 | $ | — | $ | (428,062 | )(3) | $ | 5,149,100 | ||||||
| Liabilities held for Sale |
1,217,568 | 1,217,568 | — | — | |||||||||||
| Long-Term Debt |
6,097,418 | — | — | 6,097,418 | |||||||||||
| Postretirement Benefits |
614,850 | — | — | 614,850 | |||||||||||
| Other Liabilities |
254,709 | — | — | 254,709 | |||||||||||
| Minority Interest |
398,330 | — | — | 398,330 | |||||||||||
| Stockholders’ Equity: |
|||||||||||||||
| Common Stock |
2,258,488 | — | — | 2,258,488 | |||||||||||
| Income Retained for use in the Business |
5,505,744 | — | 68,000 | (4) | 5,573,744 | ||||||||||
| Treasury Stock at Cost |
(1,508,239 | ) | — | — | (1,508,239 | ) | |||||||||
| Accumulated Other Comprehensive Income |
(374,704 | ) | — | (472,900 | )(5) | (847,604 | ) | ||||||||
| Total Liabilities and Stockholders’ Equity |
$ | 20,041,326 | $ | 17,990,796 | |||||||||||
Adjustments:
| (1) Short term investments (*) |
$ | 600,000 | ||||||
| (2) Investment in Atos Origin: 19.3 million shares acquired less 9.6 million shares sold |
$ | 587,311 | ||||||
| (3) Current portion of long-term debt - sale proceeds (*) |
$ | (585,550 | ) | |||||
| Expenses related to sale of SchlumbergerSema (*) |
157,488 | |||||||
| $ | (428,062 | ) | ||||||
| (4) Preliminary result of the sale of SchlumbergerSema activity |
$ | 68,000 | ||||||
| (5) Reversal of UK Pension liability - Other Comprehensive Income adjustment |
$ | 79,100 | ||||||
| Reversal of Cumulative Translation adjustment of SchlumbergerSema |
(552,000 | ) | ||||||
| $ | (472,900 | ) | ||||||
| (*) | Proceeds from the sale of SchlumbergerSema and the sale of Atos Origin shares, less expenses aggregated $1.0 billion. Of this, $0.6 billion is invested in short term investments and $0.4 billion is used to repay current portion of long-term debt. |
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The following table shows the unaudited condensed pro forma statement of operations for the year ended December 31, 2003 as if the transactions had taken place on January 1, 2003:
SCHLUMBERGER
UNAUDITED CONDENSED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 2003
| (Amounts in thousands of US Dollars) | ||||||||||||||
| Historical |
Adjustments |
Pro Forma Schlumberger | ||||||||||||
| Schlumberger |
SchlumbergerSema |
|||||||||||||
| Revenue: |
||||||||||||||
| Operating |
$ | 13,892,604 | $ | 2,677,061 | $ | 272,516 | (1) | $ | 11,488,059 | |||||
| Interest and other Income |
166,493 | — | 10,500 | (2) | 176,993 | |||||||||
| 14,059,097 | 2,677,061 | 283,016 | 11,665,052 | |||||||||||
| Expenses: |
||||||||||||||
| Cost of goods sold and services |
11,419,873 | 2,141,824 | 272,516 | (1) | 9,550,565 | |||||||||
| Research & engineering |
556,124 | 30,303 | — | 525,821 | ||||||||||
| Marketing |
350,996 | 172,706 | — | 178,290 | ||||||||||
| General |
662,224 | 271,190 | — | 391,034 | ||||||||||
| Debt extinguishment costs |
167,801 | — | — | 167,801 | ||||||||||
| Interest |
334,336 | — | (17,200 | )(3) | 317,136 | |||||||||
| 13,491,354 | 2,616,023 | 255,316 | 11,130,647 | |||||||||||
| Income from continuing operations before taxes and minority interest |
567,743 | 61,038 | 27,700 | 534,405 | ||||||||||
| Taxes on income |
209,386 | 22,260 | 6,510 | (4) | 193,636 | |||||||||
| Income from continuing operations before minority interest |
358,357 | 38,778 | 21,190 | 340,769 | ||||||||||
| Minority Interest |
114,200 | (1,136 | ) | — | 115,336 | |||||||||
| Income from Continuing Operations |
$ | 472,557 | $ | 37,642 | $ | 21,190 | $ | 456,105 | ||||||
| Earnings Per Share from Continuing Operations: |
||||||||||||||
| Basic |
$ | 0.81 | $ | 0.78 | ||||||||||
| Diluted |
$ | 0.81 | $ | 0.78 | ||||||||||
| Weighted Average Shares Outstanding: |
||||||||||||||
| Basic |
583,904 | 583,904 | ||||||||||||
| Diluted |
586,491 | 586,491 | ||||||||||||
Adjustments:
| (1) Add back of inter-company revenue & costs |
$ | 272,516 | ||||||
| (2) Increase in interest income(*) |
$ | 10,500 | ||||||
| (3) Reduction of interest expense (**) |
$ | (17,200 | ) | |||||
| (4) Reduced tax benefit on net interest expense (*)(**) |
$ | 6,510 | ||||||
| (*) | Based on interest rates of 1.5% to 2.0%. A one eighth of a percentage point change would not be material. |
| (**) | Based on interest rates of 4.3% for UK Commercial Paper. A one eighth of a percentage point change would not be material. |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SCHLUMBERGER N.V. | ||||
| (SCHLUMBERGER LIMITED) | ||||
| Date: March 15, 2004 |
By: |
/s/ Frank A. Sorgie | ||
| Frank A. Sorgie | ||||
| Chief Accounting Officer | ||||
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