Halliburton Profit Beats on International Strength

Tuesday, January 23, 2024

Halliburton's fourth-quarter profit beat market expectations on Tuesday as strength in offshore and overseas drilling activities boosted demand for oilfield services and equipment.

With a better economic environment and acerages internationally, oilfield services are setting their sights outside the United States to grow, with the North American segment dominated by higher efficiencies but fewer wells.

Halliburton's international revenue rose 10% to $3.3 billion in the reported quarter year over year, while revenue from North America fell 7.7% to $2.4 billion.

However, fourth-quarter overall revenue slightly missed analysts' expectations, coming in at around $5.74 billion against expectations of $5.78 billion.

The company's international revenue was boosted by improved activity in the Middle East, in line with larger rival SLB, which beat analysts' estimates for quarterly profit last week.

Shares of Halliburton were up 2% before the opening bell.

"I am excited about 2024. The outlook for oilfield services demand remains strong," Chief Executive Jeff Miller said in a statement.

The company said in 2023 it returned $1.4 billion of cash to shareholders through stock repurchases and dividends, which represents over 60% of its free cash flow.

Analysts had expected the company to return well over a minimum of 50% of free cash flow to its shareholders.

The company said margins remained flat sequentially in the United States on reduced activity in the region and Mexico.

Oil and gas rig count, an indicator of future production, stood at 948 in 2023 internationally, the highest since early 2020, per data from energy services firm Baker Hughes, while U.S. oil and gas rig count stood at 689 in 2023, down from 721 in 2022.

The Houston-based company said adjusted net income stood at 86 cents per share for the three months ended Dec. 31, higher than 80 cents expected by analysts, according to LSEG analysts.

(Reuters - Reporting by Seher Dareen; Editing by Maju Samuel)

Categories: Technology Finance Drilling Industry News

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