Halliburton's Loss Deepens
May 03 2016 - 8:10AM
Dow Jones News
By Anne Steele
Halliburton Co.'s quarterly loss widened, hurt by drastically
lower revenue from its North American business amid the downturn in
the energy market, as well as charges from its failed tie-up with
Baker Hughes Inc.
On Sunday, Halliburton and Baker Hughes called off their merger,
which was once valued at nearly $35 billion, after the companies
had faced intense regulatory pressure on several continents. They
had struck the deal in 2014, but it had appeared especially
troubled since April, when the Justice Department filed a lawsuit
to block it. Baker Hughes on Monday outlined cost cuts and stock
and debt buybacks as it looked to pave the way forward in the wake
of the deal being scuttled.
Halliburton, the second largest oil-field-services company
behind Schlumberger Ltd. and a bellwether for the industry, said
Tuesday that revenue in its North American operations skidded 49%
from a year earlier to $1.79 billion.
For the period ended March 31, Halliburton reported a loss of
$2.41 billion, or $2.81 a share, compared with a year-earlier loss
of $643 million, or 76 cents a share. Excluding special items,
adjusted earnings from continuing operations were 7 cents a share.
Total revenue slid 40% to $4.2 billion.
Analysts polled by Thomson Reuters expected adjusted earnings of
4 cents a share on revenue of $4.16 billion.
The company said it recorded Baker Hughes acquisition-related
costs of $378 million, or 44 cents a share, in the quarter.
The company also cited market conditions for the weaker results,
with the number of rigs operating declining to historic lows in the
face of continued depressed commodity prices, "which created
further widespread pricing pressure and activity reductions for the
company's products and services on a global basis."
Halliburton said it recorded companywide charges related to
asset impairments and severance costs of about $2.1 billion, or
$2.39 a share, in the first quarter.
Last month, rival Schlumberger Ltd. said it laid off another
2,000 employees during the first quarter as it reported that
earnings for the period dropped 49% on significantly lower
sales.
Shares of Halliburton, inactive premarket, have surged 32% over
the past three months, easing a 12-month slide to 14%.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
May 03, 2016 07:55 ET (11:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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