Strong Sales Boost Halliburton Profits 19%

Halliburton Co. posted a 19% jump in third-quarter earnings as record oil prices led to increased exploration spending, resulting in large sales gains, especially in the Middle East and Asia where spending increased 41%. One analyst called the company's revenue growth of 26% outside North America and profit margins of 24% in the Eastern Hemisphere "phenomenal." The oilfield services company reported net income of $727M ($0.79/share) on revenue of $3.93B, up from $611M ($0.58/share) on revenue of $3.39B a year ago. Excluding a $0.15/share gain from the recognition of U.S. foreign tax credits, and a $0.02/share charge related to environmental matters, earnings were $0.66/share, topping the average analyst estimate of $0.64/share Also contributing to the higher earnings were 13% fewer shares outstanding than a year earlier; the company said it bought back 11M shares during the quarter at an average price of $33.71. Halliburton said it is still seeing strong demand for its services in U.S. land-based markets.

Sources: Press release, Bloomberg, Reuters
Commentary: Schlumberger, Halliburton Poised To Gain On Higher Oil Prices
Stocks to watch: HAL. Competitors: SLB. ETFs: OIH, PXJ, XES

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Comments

[King Kang:]

No surprise that Halliburton was able to post numbers like these, especially with oil looking to hit over $100 a barrel before the year is out (it will go even higher if Turkey invades northern Iraq). As for the "Eastern Hemisphere", Halliburton goes where the oil and oil infrastructure is. Since most new fields (or older fields with shabby infrastructure) are located in the Middle East or Asia....no surprise again. However, Halliburton's most prized asset may be its corporate ties to the energy industry, not to mention other relevant industries (chemicals, airlines, etc.) www.newsvisual.com/new... . These ties provide Halliburton with lobbying connections and inside info to help it stay one step ahead of the competition.

2007 Oct 22 04:00 PM