Baker Hughes Shares Tumble on Lower Q3 Profit

by Christopher Freeburn | October 19, 2012 12:16 pm

Shares of Baker Hughes (NYSE:BHI[1]) dropped more than 5% in midday trading on Friday after it announced quarterly results that fell short of expectations[2].

Baker Hughes said it earned $279 million during the third quarter, down 60% from $706 million in the same period last year. Adjusted EPS was 73 cents, down from $1.18 in 2011, and missing the 84 cents Wall Street anticipated, Dow Jones noted.

The oilfield services company said quarterly revenue rose to $5.23 billion, up 3.2% over last year. But that also missed analysts’ predictions for revenue of $5.44 billion.

Company officials noted that drilling in Canada had dropped 30% compared to 2011, while rig counts in Norway, Columbia and Brazil were down 17% from the last quarter, though international drilling was forecast to improve by year-end.

Baker Hughes said its operating margin tumbled from 15.9% last year to 8.8% on expenses that jumped 12% to $4.77 billion. An imbalance at its pressure pumping operations in North America, as well as reduced activity in other regions, was blamed for the rise in expenses.

On Tuesday, oilfield rival Halliburton (NYSE:HAL[3]) reported lower third-quarter earnings that matched analysts’ forecasts[4] on revenue that rose 9% over last year.

Endnotes:
  1. BHI: http://studio-5.financialcontent.com/investplace/quote?Symbol=BHI
  2. quarterly results that fell short of expectations: http://www.foxbusiness.com/news/2012/10/19/baker-hughes-3rd-quarter-net-falls-60-on-lower-than-expected-international/
  3. HAL: http://studio-5.financialcontent.com/investplace/quote?Symbol=HAL
  4. that matched analysts’ forecasts: http://investorplace.com/2012/10/halliburton-reports-higher-q3-revenue/

Source URL: http://investorplace.com/2012/10/baker-hughes-shares-tumble-on-lower-q3-profit/
Short URL: http://invstplc.com/1fuc5oD