Weatherford International said Wednesday that it will cut 6,000 jobs and close more facilities after reporting a $102 million fourth quarter net loss before charges.
The Switzerland-based company said the headcount reduction is part of a cost cutting plan prompted by “harsh market conditions.”
The cuts are expected to be completed during the first half of 2016.
Weatherford will also close nine more manufacturing and services facilities and added that it will continue to “rationalize our operating facility footprint.”
The company expects the cost cutting measures will lower its 2016 capital expenditures to $300 million, a 56 percent decline from its 2015 spending level.
“As we look forward, we believe that oil prices will respond to the gradual tightening of the supply-demand balance, with increasing demand and diminishing supply. This is inevitable, given the extreme cuts in both capital and operating spend by our customer base around the world,” Weatherford chairman, president and CEO Bernard J. Duroc-Danner said.
The company added that it also completed its previously announced headcount reduction target of 14,000 employees last year as well as closing six out of the seven manufacturing and service facilities it planned to shutter.
Weatherford also closed 90 operating facilities in North America in 2015, with 20 being closed during the fourth quarter.
Those cost cuts, along with other actions, produced savings of $1.4 billion per year, the company said.
Weatherford International reported a net loss before charges of $102 million, or a $0.13 net loss per share before charges, on revenues of $2.01 billion for the fourth quarter of 2015.
The company posted a GAAP net loss for the fourth quarter of $1.21 billion, or a net loss of $1.54 per share.
Weatherford took $1.1 billion in after tax charges for the fourth quarter including a $952 million charge primarily tied fixed asset impairments and inventory write-downs and $55 million for costs related to severance and facility closures from its 2015 cost reduction plan.
The company’s North American segment booked fourth quarter revenues of $699 million, a 60 percent decline over the same quarter in 2014, and a fourth quarter operating loss of $68 million.
Weatherford’s international segment reported $142 million in fourth quarter operating income on revenues of $1.2 billion, a 33 percent year-over-year drop.
The company’s land drilling rig segment fell to an operating loss of $17 million in the fourth quarter on $147 million of revenues.
“The near-term outlook is challenging with lower levels of customer activity, continued pricing pressures and seasonal declines across many parts of the Northern Hemisphere…We believe the second half of the year will show a slight recovery underpinned by the stabilizing of commodity prices,” Duroc-Danner said.