Baker Hughes books bigger quarterly loss
Oilfield services provider Baker Hughes saw its loss deepen during the second quarter of the year as its revenues decreased by 21 per cent compared to the same period last year.
According to its report on Wednesday, Baker Hughes’ orders of $4.9 billion for the quarter were down 12 per cent sequentially and down 25 per cent year-over-year when the company’s orders were $6.6 billion.
Year-over-year, the decline in orders was driven by Turbomachinery & Process Solutions, Digital Solutions, and Oilfield Services, partially offset by year-over-year growth in Oilfield Equipment.
Year-over-year equipment orders were down 22 per cent and service orders were down 28 per cent.
Baker Hughes booked revenues of $4.7 billion for the quarter, down 13 per cent sequentially and down 21 per cent year-over-year when the company booked revenues of $6 billion.
GAAP operating loss of $52 million for the quarter was favourable sequentially and unfavourable year-over-year when its GAAP operating income was $271 million.
The company posted adjusted operating income (a non-GAAP measure) of $104 million for the quarter, down 56 per cent sequentially and down 71 per cent year-over-year when the adjusted operating income was $361 million.
Net loss attributable to Baker Hughes in 2Q 2020 was $201 million compared to a loss of $9 million in 2Q 2019.
Lorenzo Simonelli, Baker Hughes Chairman and Chief Executive Officer, said: “The second quarter of 2020 was challenging in several areas as our company navigated through the ongoing impacts of the COVID-19 pandemic and the sharp decline in activity levels due to lower oil and gas prices”.
Simonelli added: “Although the majority of lockdowns have been easing globally and economic activity likely troughed during the second quarter, visibility on the economic outlook remains extremely limited. More specifically, the risk of a second wave of virus cases, the reinstitution of select lockdowns, and the risk of lingering high unemployment creates an uncertain economic environment that likely persists through the rest of 2020.
“Given these factors, we are preparing for potential future volatility, while also focusing on structurally reducing our cost base and implementing a number of strategic initiatives across all of our product companies.
Simonelli also said that Baker Hughes is on track to hit its goals of structurally right-sizing business and achieving the $700 million in annualized cost savings by year-end.