Baker Hughes Earnings Outperform - Analyst Blog
19 Abril 2013 - 7:32AM
Zacks
Baker Hughes Inc. (BHI) reported first quarter
2013 adjusted earnings from continuing operations of 65 cents a
share, which beat the Zacks Consensus Estimate of 62 cents aided by
improved North America results. However, the quarterly figure fell
24.4% from the year-ago adjusted profit level of 86 cents a
share.
The year-over-year decline stemmed mainly from seasonal weakness,
in particular the Europe/Africa/Russia/Caspian segment. Moreover,
weak activity in several important markets of Baker Hughes resulted
in an unfavorable mix.
Total revenue of $5,230 million fell 2.3% from the year-ago level
of $5,355 million. However, the top line surpassed the Zacks
Consensus Estimate of $5,172 million.
First Quarter Segmental Highlights
Of Baker Hughes' total quarterly revenue, North America,
Europe/Africa/Russia/Caspian, Middle East/Asia-Pacific and Latin
America accounted for 50%, 16%, 17% and 11%, respectively. The
remainder was generated by the Industrial Services segment.
An improvement in before-tax profit was noticed in the Middle
East/Asia-Pacific region, which recorded a profit before-tax margin
of 13% versus 10% in the year-ago quarter. The Industrial Services
segment margin remained unchanged at 8%.
All other segments registered lackluster pre-tax margins, with
North America coming in at 9% (compared with 14% in the
year-earlier quarter) and Latin America coming in at 8% (versus
12%). Pre-tax margins at Europe/Africa/Russia/Caspian segment came
in at 11% (versus 17% in the year-earlier quarter).
Liquidity
At the end of the first quarter, Baker Hughes had $1,101.0 million
in cash and cash equivalents, while long-term debt was $3,844.0
million, representing a debt-to-capitalization ratio of 18.1%. The
company's capital expenditures were $490.0 million in the
quarter.
Ranks
Baker Hughes, the world's third-largest oilfield services provider
following Schlumberger Ltd. (SLB) and
Halliburton Co. (HAL), holds a Zacks Rank #3
(Hold) and is expected to perform in line with the broader market
over the next few months. However, there are other better
performing sector stocks, like Zacks Ranked #1 Range
Resources Corporation (RRC), that are likely to outperform
the market.
BAKER-HUGHES (BHI): Free Stock Analysis Report
HALLIBURTON CO (HAL): Free Stock Analysis Report
RANGE RESOURCES (RRC): Free Stock Analysis Report
SCHLUMBERGER LT (SLB): Free Stock Analysis Report
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