News wire — Oilfield services giant Halliburton Co posted its third straight quarterly loss on Monday as it took a $2.1 billion impairment charge amid a slump in oil prices and collapse in drilling by North American customers.
Demand for drilling services offered by Halliburton and rivals like Schlumberger and Baker Hughes sank after oil prices collapsed in March. U.S. crude futures were trading around $40 per barrel on Monday, at the bottom end of what most producers need to be profitable.
Many smaller oilfield service firms, including fracker BJ Services and sand provider Hi-Crush, have filed for bankruptcy since the price rout began.
As North American markets face pressure, Halliburton expects its international business to become a bigger contributor to its revenue, Chief Executive Jeff Miller told investors on Monday.
Halliburton said it anticipates third quarter revenue to decline by low single digits, pressured by lower drilling activity. The company expects North American production to remain “structurally lower,” Miller said.
The Houston, Texas-based company reported a net loss of $1.7 billion, or $1.91 per share, in the second quarter, compared with a profit of $75 million, or 9 cents per share, a year earlier.
Shares rose 5.05% in early trading to $13.74 as market analysts praised its better-than-expected free cash flow and aggressive cost cutting.
“We believe 2Q results reflect quicker and potentially stronger cost reductions,” analysts from Wells Fargo wrote in a note on Monday.
The company reported free cash flow of $456 million, significantly topping expectations.
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