FOCUS - Halliburton, Noble post strong profit gains
DALLAS, April 22 (Reuters) - Energy services and engineering group Halliburton Co. (HAL - news) reported a 42 percent
rise in first quarter earnings on Wednesday which it said was entirely due to to its energy-related businesses.
Separately, Noble Drilling (NE - news) said its profits nearly doubled due to due to higher day rates for contract drilling.
Dallas-based Halliburton's net income rose to $117.8 million or 44 cents per share from $83.0 million or 32 cents per share in
the same period of 1997. Revenues rose 24 percent to $2.4 billion.
Operating income at Halliburton's energy services division jumped 58 pecent to $185 million, showing no signs of any ill effect
from protracted oil price weakness which has eroded the earnings of its clients in oil exploration and production.
Halliburton's chairman, former U.S. Defense Secretary Dick Cheney, said in a statement that he expected the energy services
business -- which generates two thirds of the company's revenues -- to make further progress during the rest of the year.
The company's engineering and construction business saw a small decline in operating income to $28.8 million, but Cheney said
its performance was likely to improve as the year progressed.
Halliburton has previously announced plans to buy Dresser Industries for $7.7 billion, leapfrogging Schlumberger to become
the world's biggest oil services group.
Houston-based Noble Drilling reported a 95 percent surge in first quarter net income to $46.2 million due to higher average
day rates for contract drilling.
Noble Chairman James Day said he was pleased with the first-quarter results but pointed to a cloud on the horizon.
''Due to the weakness in oil prices we can anticipate some decline in dayrates in certain markets, most dramatically in the Gulf
of Mexico. However, our continued strategy of seeking longer-term contracts mitigates, to some extent, the near volatility in the
commodity markets,'' he said.
Two oil majors, Exxon Corp. and Shell Oil, had some good news for drillers and service companies on Wednesday when they
said they had no plans to follow Amoco and Unocal in cutting their capital spending on exploration and production.
Meanwhile, rating agency Standard & Poor's, upgrading the debt of Diamond Offshore Drilling (DO - news) on Wednesday,
said the contract drilling sector's financial performance had been extraordinarily strong and could improve further over the next
one to two years.
''However, Standard & Poor's also has concluded that such high level of financial performance is unsustainable over the long
term,'' it added.
Shelia, looks like we might be able to hang on for one or two more years before the bill collectors come knocking on our doors. |
