National Oilwell Varco 2012 Annual Report Download - page 45

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Index to Financial Statements
Non-GAAP Financial Measures and Reconciliations
In an effort to provide investors with additional information regarding our results as determined by GAAP, we disclose various non-GAAP financial measures in our quarterly
earnings press releases and other public disclosures. The primary non-GAAP financial measures we focus on are: (i) operating profit excluding other costs, (ii) operating profit
percentage excluding other costs, and (iii) diluted earnings per share excluding other costs. Each of these financial measures excludes the impact of certain other costs and
therefore has not been calculated in accordance with GAAP. A reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure
is included below.
We use these non-GAAP financial measures because we believe it provides useful supplemental information regarding the Companys on-going economic performance and,
therefore, use these non-GAAP financial measures internally to evaluate and manage the Companys operations. We have chosen to provide this information to investors to
enable them to perform more meaningful comparisons of operating results and as a means to emphasize the results of on-going operations.
The following tables set forth the reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measures (in millions, except per share
data):
$000,00000 $000,00000 $000,00000 $000,00000 $000,00000 $000,00000
Three Months Ended
December 31, September 30,
2011
Years Ended December 31,
2011 2010 2011 2010 2009
Reconciliation of operating profit:
GAAP operating profit $ 848 $ 624 $ 772 $ 2,937 $ 2,447 $ 2,315
Other costs:
Transaction costs 12 1 6 24 7 41
Libya asset write-down 17
Devaluation costs 38
Voluntary early retirement costs 46
Intangible asset impairment 147
Operating profit excluding other costs $ 860 $ 625 $ 778 $ 2,978 $ 2,492 $ 2,549
Three Months Ended
December 31, September 30,
2011
Years Ended December 31,
2011 2010 2011 2010 2009
Reconciliation of operating profit %:
GAAP operating profit % 19.9% 19.7% 20.6% 20.0% 20.1% 18.2%
Other costs % 0.3% 0.0% 0.2% 0.3% 0.2% 1.9%
Operating profit % excluding other costs 20.2% 19.7% 20.8% 20.3% 20.3% 20.1%
Three Months Ended
December 31, September 30,
2011
Years Ended December 31,
2011 2010 2011 2010 2009
Reconciliation of diluted earnings per share:
GAAP earnings per share $ 1.35 $ 1.05 $ 1.25 $ 4.70 $ 3.98 $ 3.52
Other costs 0.02 0.01 0.07 0.11 0.37
Earnings per share excluding other costs $ 1.37 $ 1.05 $ 1.26 $ 4.77 $ 4.09 $ 3.89
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