Halliburton Company (HAL) is scheduled to report their results after the market closes on April 19, 2010. Most of Halliburton's first half of 2010 will be driven by US pressure pumping fueled by higher drilling activity and strong operating leverage while the second half will benefit from the ramp-up of multi-year international projects, principally in the Middle East, South East Asia and Brazil.
Halliburton Company provides a variety of services, equipment, maintenance, and engineering and construction to energy, industrial and governmental customers. The company is made up of the following three business segments: Energy Services Group, Engineering and Construction Group, and Dresser Equipment Group.
HAL reported 4Q09 "operating" EPS of $0.28/sh, slightly above consensus of $0.27. In line with SLB's US Land results, HAL NAm revenues rose 12% Q/Q as rig count climbed 20%. NAm EBIT margin improved ~360bps seq. driven by strong utilization gains coupled with modest pricing increases in pressure pumping. Int'l revenues were down 2% and margins dropped 440bps seq., primarily due to lower activity inMexico coupled with low direct sales in theMiddle East. Net income for Q4 2009 was $243 million, or $0.27 per diluted share. This compares to net income for the Q3 2009 of $262 million, or $0.29 per diluted share. Consolidated revenue in Q4 2009 was $3.7 billion, compared to $3.6 billion in Q3 of 2009. Consolidated operating income was $428 million in the Q4 of 2009 compared to $474 million in previous quarter. Halliburton's revenue was $14.7 billion for the full year 2009, a decrease of 20% from the full year 2008, and operating income was $2.0 billion, a decrease of 50% from the full year 2008.
Analysts' estimates for Q1 2010 range from a low of $0.22 to a high of $0.32, compared to a consensus estimate of $0.26, with number of estimates being 28 and the co-efficient variance 10.33. Halliburton Company announced that its Board of Directors declared a 2010, first quarter dividend of $0.09 a share on the company's common stock payable March 23, 2010, to shareholders of record at the close of business on March 2, 2010. On January 14, 2010 the company announced a joint venture with SGS Societe Generale de Surveillance SA to provide reservoir fluid analysis solutions for the energy industry. It also announced that it has been awarded a two year contract, plus options, with ConocoPhillips China Inc. amounting to nearly $40 million that includes provisions of directional-drilling and logging-while-drilling services on the Peng Lai Development inChina's Bohai Bay. Both developments are expected to affect earnings positively.
With the stock closing 2.02% up at $30.74 on April1, 2010, Halliburton Company is a convincing Buy with the price expected to reach nearly $40, according to consensus.
