By Tess Stynes
Halliburton Co. said its second-quarter earnings plunged 93% as
the oil-services giant's revenue tumbled on soft demand,
particularly in its North America operations.
Still, shares rose 2.5% to $41 in recent premarket trading, as
per-share earnings and revenue beat expectations.
The sector has been facing challenges from world lower crude
prices, particularly in the U.S., where shale producers are paring
their operations. Like other oil-field services companies,
Halliburton has cut costs as oil and natural-gas producing
customers have reduced exploration and drilling activities and have
sought lower prices in the wake of weak commodities prices.
In the latest quarter, Halliburton reported that revenue in its
North America business declined 39% to $2.67 billion.
Rival Schlumberger Ltd. said last week that it expects drilling
and fracking operations to start picking back up in the second half
of the year, though it also reported that its second-quarter
earnings fell 30% on plunging revenue, including a decline of 39%
in North America.
Halliburton, the second largest oil-field-services company and a
bellwether for the industry, is in the process of acquiring smaller
rival Baker Hughes Inc. The deal still requires approval by
antitrust regulators. Baker Hughes is set to report second-quarter
results on Tuesday.
Chairman and Chief Executive Dave Lesar said in prepared remarks
Monday that "We are pleased with the progress of the proposed Baker
Hughes acquisition, as evidenced by our recently announced timing
agreement with the U.S. Department of Justice." He added that
Halliburton "recently received the initial round of bids on our
previously announced divestitures, and are pleased with the prices
and level of interest."
Overall, Halliburton reported a profit of $54 million, or six
cents a share, down from $774 million, or 91 cents a share, a year
earlier. Excluding restructuring-related charges, costs related to
its Baker Hughes and other items, earnings from continuing
operations fell to 44 cents from 49 cents. Revenue tumbled 26% to
$5.92 billion.
Analysts polled by Thomson Reuters expected per-share profit of
29 cents and revenue of $5.78 billion.
Write to Tess Stynes at tess.stynes@wsj.com
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