More red ink for Baker Hughes

Oilfield services provider Baker Hughes on Tuesday posted a wider net loss for the third quarter of 2016, when compared to prior-year quarter, due to impairment charges. 

Baker Hughes reported that its net loss widened during the third quarter of 2016 compared to the same period last year. Namely, the company posted a $429 million loss for 3Q 2016, compared to $159 million a year earlier.

The third quarter includes after-tax charges of $365 million, related to asset impairments, restructuring, litigation settlements, and goodwill impairment.

The company’s revenue for the third quarter of 2016 was $2.4 billion, down $1.4 billion, or 38%, compared to the same quarter last year and revenues of $3.8 billion. Compared to the second quarter of 2016, the revenue was down $55 million, or 2%.

Sequentially, the company said, the revenue was impacted by activity declines, primarily in the Gulf of Mexico, Norway, and West Africa deepwater operations, and increasing market pricing pressures. This was partially offset by pockets of activity increase, mainly in the U.S. onshore, Saudi Arabia, Canada, and Kuwait.

For the quarter, capital expenditures were $70 million, unchanged sequentially, and down $108 million, or 61%, compared to the third quarter of 2015. The reduction in capital expenditures is attributable to reduced activity levels and the company’s continued focus on capital discipline.

Looking ahead, Martin Craighead, Baker Hughes Chairman and Chief Executive Officer, said: “While we expect the market conditions to remain challenging near term, the structural changes we implemented in the past six months have created a stronger foundation for delivering on our objectives and positioning the company for growth.”

Offshore Energy Today Staff

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