Halliburton Aims to Boost Weak Businesses
Halliburton Co said it would consider acquisitions to bolster its weaker businesses as the oilfield services company looks to move on after a deal to buy smaller rival Baker Hughes Inc fell through.
Halliburton also reported a higher-than-expected adjusted profit for the first quarter. But, the company's shares were down 3.6 percent at $40.53, amid a broader decline in energy stocks.
"We are going to invest in those product lines where we're a little bit weak, and we'll look at selective acquisitions to round them out," Halliburton Chief Executive Dave Lesar said on a post-earnings conference call.
Halliburton's deal for Baker Hughes, valued at $35 billion when its was announced 18 months ago, was called off on Sunday after opposition from U.S. and European antitrust regulators.
"We continue to believe the proposed Baker Hughes transaction would have been pro-competitive, that our proposed divestitures were more than sufficient to address any regulatory concerns," Lesar said.
However, Lesar said the steep fall in oil prices since the deal was announced had "eroded the expected synergies and accretive aspects" of the deal while making it difficult to "obtain adequate value" for the proposed divestitures.
Net loss attributable to Halliburton widened to $2.41 billion, or $2.81 per share, in the three months ended March 31, from $643 million, or 76 cents per share, a year earlier.
The bigger loss was due to $2.77 billion in charges for asset impairment and other reasons amid the prolonged slump in oil prices.
But deep cost cuts helped cushion the impact of a drop in drilling and completion activity.
Excluding one-time charges, Halliburton earned 7 cents per share, higher than analysts average estimate of 4 cents, according to Thomson Reuters I/B/E/S.
Halliburton had, on April 22, reported a 40.5 percent fall in revenue, to $4.2 billion, for the quarter, during which it cut 6,000 jobs.
Revenue in the company's North American business nearly halved, hurt by continued weakness in drilling activity and pricing.
Last week, Baker Hughes reported a bigger first-quarter loss and warned that the rig count globally would drop steadily through the end of the year because of fewer new projects.
(Reporting by Amrutha Gayathri in Bengaluru)
