Halliburton posted a 42% loss in its total revenue year-on-year for Q4 2015 that the company said is a result from the impact of reduced commodity prices creating widespread pricing pressure and activity reductions on a global basis.
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Image from Halliburton. |
The Houston-based oilfield services giant’s Q4 2015 total revenue came in at US$5.1 billion, compared to $5.6 billion in Q3 2015, a 9% drop; and Q4 2014’s $8.8 billion, a 42% decrease.
For full year 2015, total revenue decreased 28% from $23.6 billion, compared to $32.9 billion in 2014. Halliburton reported a $165 million operating loss for the year, compared to $5.1 billion in 2014, which Halliburton president Jeff Miller said outperformed a 35% decline in both the average worldwide rig count and global drilling and completions spend.
According to the Q4 and full year report, both revenue and operating income declines resulted from the impact of reduced commodity prices creating widespread pricing pressure and activity reductions on a global basis.
As a result of the downturn in the energy market and its corresponding impact on the company’s business outlook, Halliburton recorded company-wide charges related primarily to asset writeoffs and severance costs of approximately $192 million in Q4 2015, compared to $257 million in Q3 2015, the company said.
Adjusted operating income for the period was $473 million, compared Q3 at $506 million, representing a 6.5% decline.
“We are pleased with our fourth quarter and full-year results in this challenging environment, as once again we outperformed our peer group in North America and international revenue, both sequentially and on a full-year basis,” said Miller. “Annual revenue declined 16% from the prior year, outperforming our largest peer sequentially and on a full year basis for both revenue and margins. Despite pricing and activity headwinds, we were able to improve 2015 operating margins due to a focus on cost management.”
“2016 is expected to be another challenging year for the industry. We believe our customers will remain focused on cost per barrel optimization and gaining higher levels of efficiency, both of which bode very well for Halliburton. Ultimately, when this market recovers we believe North America will respond the quickest and offer the greatest upside, and that Halliburton will be positioned to outperform,” Dave Lesar, Halliburton chairman and CEO said.
In Q4 2015, Halliburton incurred a 21.5% increase from Baker Hughes acquisition-related costs of $79 million, compared to $62 million in Q3 2015.
“We are continuing our discussions with competition authorities, and recently offered an enhanced set of divestitures in an effort to resolve competition-related concerns as soon as possible. We are diligently focused on pending regulatory reviews, the divestiture process, and planning for integration activities after the closing of the deal,” Lesar said.
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