Oil services company Halliburton posts deep loss

Company is the second in the sector to report a downturn after Schlumberger.
By Daniel J. Graeber  |  Jan. 25, 2016 at 8:29 AM
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HOUSTON, Jan. 25 (UPI) -- Steep declines in the North American market were in part behind the 9 percent decline in revenue, oil field services company Halliburton said.

Halliburton, which provides services to the drilling and production side of the energy sector, reported a $28 million loss for the fourth quarter, against a profit from the previous year's quarter of $901 million. Total revenue was down 9 percent.

"North America revenue declined 39 percent compared to 2014, as a result of unprecedented declines in activity, with the U.S. land rig count ending the year down 64 percent from the 2014 peak," Halliburton President Jeff Miller said in a statement.

Halliburton is the second-largest company of its kind behind Schlumberger, which last week reported a 9 percent decline in fourth quarter revenue. North American operations accounted for the bulk of the drop for Schlumberger, with land-based revenue falling off in the region by 45 percent.

Halliburton's international business saw fourth quarter revenue decline 5 percent. Year-end equipment sales for the company did not bring in the expected late surge in revenue either because some of Halliburton's customers are also facing budget constraints.

Outside of operating costs, the company recorded $79 million in costs related to the pending acquisition of rival services company Baker Hughes, compared to $62 million during the fourth quarter.

"We remain fully committed to closing the pending acquisition of Baker Hughes," Halliburton Chairman and CEO Dave Lesar said.

The planned merger between the services companies has faced anti-trust scrutiny. The European Commission found last week that only Halliburton, Baker Hughes and Schlumberger were able to provide necessary services to the industry, adding the merger of the former two would grossly inhibit competition from smaller potential market players.

Despite the industry headwinds, President Miller said the company was laying the groundwork for a strong recovery once the energy sector rebounds.

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