Halliburton’s 4Q loss widens
Halliburton, one of the world’s largest oilfield services providers, reported a net loss of $153 million for the fourth quarter of 2016. To remind, Halliburton’s loss a year earlier was $26 million.
Revenue for the quarter ended December 31, 2016, was around $4 billion, down from the $5 billion in the same quarter od 2015, however, the revenue was up compared to the $3.8 billion reported in third quarter 2016.
Total revenue for the full year of 2016 was $15.9 billion, a decrease of $7.7 billion, or 33%, from 2015. Reported operating loss for 2016 was $6.8 billion, compared to reported operating loss of $165 million for 2015. Excluding special items, adjusted operating income for 2016 was $690 million, compared to adjusted operating income of $2.3 billion for 2015.
Both revenue and operating results declined due to the impact of lower commodity prices creating widespread pricing pressure and activity reductions on a global basis, Halliburton said.
Dave Lesar, Chairman and CEO said, “I am pleased to announce that we returned to operating profitability in North America this quarter, and achieved 65% incremental margins.
North America revenue in the fourth quarter of 2016 was $1.8 billion, a 9% increase sequentially, relative to a 23% increase in average U.S. rig count.
“We gained significant market share through the downturn, and as the market stabilized we leveraged this share to drive margin improvement. This market share improvement continued in the fourth quarter as we outgrew our primary competitor in North America, Latin America and the Eastern Hemisphere,“ Lesar added.
However, Lesar said that despite the positive sentiment surrounding the North American land market,” it is important to remember that our world is still a tale of two cycles.”
International downward cycle still playing out
Lessar said: “The North America market appears to have rounded the corner, but the international downward cycle is still playing out. In the international markets, low commodity prices have stressed budgets and have impacted economics across deepwater and mature field markets, which led to decreased activity and pricing throughout 2016. Despite these headwinds, we maintained our margin in the Eastern Hemisphere for the fourth quarter. We do not expect to see an inflection in the international markets until the latter half of 2017. “
“2016 was a year of transition, and as we move into 2017 our focus will be on driving industry leading returns. We will continue to maintain our financial flexibility, leverage our strong balance sheet to invest in our broad service portfolio and strengthen our long term market position,” concluded Lesar.