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Halliburton Shares Trade Higher on Q3 Earnings

Source:

Shares of Halliburton Co. at times traded greater than 8% higher after the firm reported improved Q3/19 earnings results versus Q2/19.

This morning before the opening bell Halliburton Co. (HAL:NYSE) announced its third quarter earnings for the period ending September 30, 2019. The company reported net income of $295 million, or $0.34 per diluted share, during Q3/19. This compares to reported net income for Q2/19 of $75 million, or $0.09 per diluted share, and adjusted net income for Q2/19 of 303 million, or $0.35 per diluted share, excluding impairments and other charges. Operating income was $536 million during Q3/19, compared to reported operating income of $303 million and adjusted operating income of $550 million for Q2/19.

Jeff Miller, Halliburton's chairman, CEO and president commented, "Our organization executed effectively in the third quarter. We managed the market dynamics and delivered our financial results as per expectations...Total company revenue was $5.6 billion and operating income was $536 million, representing decreases of 6% and 3%, respectively, compared to revenue and adjusted operating income in Q2/19...International revenue, which was flat sequentially, was up 10% year to date and we remain confident that we will achieve high single-digit international growth for all of 2019. International growth continues across multiple regions, benefitting both our Drilling and Evaluation and Completion and Production divisions...Our North America revenue decreased 11% sequentially driven by customer activity declines and the execution of our new playbook. I am proud of how our team performed in this challenging market. We are successfully implementing our new strategy and are focused on taking the right actions to deliver returns and cash flow for our shareholders...As the international recovery continues and the North American market matures, our strategy is allowing us to thrive in this dynamic environment, generate strong free cash flow and produce industry-leading returns."

The company further outlined revenues by business segment in the report noting "Completion and Production revenue in Q3/19 was $3.5 billion, a decrease of $299 million, or 8%, when compared to Q2/19, while operating income was $446 million, a decrease of $24 million, or 5%...Drilling and Evaluation revenue in Q3/19 was $2.0 billion, a decrease of $81 million, or 4%, when compared to Q2/19, while operating income was $150 million, an increase of $5 million, or 3%."

The firmed stated that North America revenue in Q3/19 decreased 11% to $2.9 billion compared to Q2/19 primarily due to lower activity and pricing in pressure pumping and well construction services in North America land.

The company indicated that although International revenue overall in Q3/19 was essentially flat at $2.6 billion compared to Q2/19, revenue in Latin America in Q3/19 increased 6% sequentially to $608 million primarily from higher activity in multiple product service lines in Argentina, increased testing activity and artificial lift sales across the region and improved fluids activity in Mexico. The firm also advised that Europe/Africa/CIS revenue in Q3/19 was $831 million, and was relatively unchanged when compared to Q2/19, and that Middle East/Asia revenue in Q3/19 decreased by 4% to $1.2 billion due to reduced project management and stimulation activity across the region.

Halliburton was founded in 1919 and is headquartered in Houston, Tex. The firm states it is one of the world's largest providers of products and services to the energy industry with approximately 60,000 employees operating in more than 80 countries. The firm serves national and independent oil and natural gas companies and states that it helps its customers maximize value throughout the lifecycle of the reservoir from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the asset. The company operates through two business segments. Its Completion and Production segment delivers cementing, stimulation, intervention, pressure control, specialty chemicals, artificial lift and completion services, and its Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation and wellbore placement solutions that enable customers to model, measure, drill and optimize their well construction activities.

Halliburton has a market capitalization of about $16.1 billion with approximately 875.9 million shares outstanding and a short interest of around 4.2%. HAL shares opened lower today at $18.15 (-$0.28, -1.52%) compared to Friday's closing price of $18.43. The stock has traded today between $18.10 and $20.00/share and currently is trading at $19.78 (+$1.34, +7.27%).

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