National Oilwell Varco 2015 Annual Report Download - page 46

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Table of Contents
Years Ended December 31, 2014 and December 31, 2013
The following table summarizes the Company’s revenue and operating profit by operating segment in 2014 and 2013 (in millions):
 
 
Revenue:
Rig Systems $ 9,848 $ 8,450 $1,398 16.5%
Rig Aftermarket 3,222 2,692 530 19.7%
Wellbore Technologies 5,722 5,211 511 9.8%
Completion & Production Solutions 4,645 4,309 336 7.8%
Eliminations (1,997) (1,441) (556) 38.6%
Total Revenue $ 21,440 $ 19,221 $2,219 11.5%
Operating Profit
Rig Systems $ 1,996 $ 1,594 $ 402 25.2%
Rig Aftermarket 882 729 153 21.0%
Wellbore Technologies 937 915 22 2.4%
Completion & Production Solutions 690 613 77 12.6%
Eliminations and other (892) (652) (240) 36.8%
Total Operating Profit $ 3,613 $ 3,199 $ 414 12.9%
Operating Profit %:
Rig Systems 20.3% 18.9%
Rig Aftermarket 27.4% 27.1%
Wellbore Technologies 16.4% 17.6%
Completion & Production Solutions 14.9% 14.2%
Total Operating Profit % 16.9% 16.6%
Rig Systems
Revenue from Rig Systems for the year ended December 31, 2014 was $9,848 million, an increase of $1,398 million (16.5%) compared to the year ended
December 31, 2013. Increased demand for high-spec land rigs and equipment resulted in higher revenues for Rig Systems in 2014. In addition, increased
capacity enabled Rig Systems to generate revenue out of backlog of $8,689 million during 2014, compared to revenue out of backlog of $7,385 million
during 2013.
Operating profit from Rig Systems was $1,996 million for the year ended December 31, 2014, an increase of $402 million (25.2%) compared to 2013.
Operating profit percentage increased to 20.3%, from 18.9% in 2013. Increased demand for high-spec land rigs and equipment generated higher operating
profit percentages.
Included in operating profit are certain Other items which include items such as transaction costs and inventory that was stepped up during purchase
accounting. Other items included in operating profit for Rig Systems were nil for the year ended December 31, 2014 and $21 million for the year ended
December 31, 2013.
Rig Systems segment monitors its capital equipment backlog to plan its business. New orders are added to backlog only when the Company receives a firm
written order for major drilling rig components or a signed contract related to a construction project. The capital equipment backlog was $12.5 billion at
December 31, 2014, a decrease of $2.5 billion (17%) from backlog of $15.0 billion at December 31, 2013.
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