Baker Hughes results miss on weak North American drilling
(Reuters) - Baker Hughes Inc (BHI.N), the world's third-largest oilfield services company, reported weaker-than-expected quarterly results as a slowdown in North American drilling activity hit prices.
The company said its margins were squeezed in particular by a slump in the North American pressure pumping business.
Oilfield services companies have had far less pricing power this year as depressed natural gas prices pushed the number of U.S. rigs targeting gas to a 13-year low.
Baker Hughes also said activity levels were less than planned in several key markets. The company said the seasonal return of activity in Canada was nearly 30 percent less than a year ago.
The total rig count in international markets such as Brazil, Colombia and Norway fell 17 percent in third quarter from the second, the company said.
However, it said it expects activity in international markets to rebound in the current quarter.
Like other North American oil services companies, Baker Hughes has been hit by a short-lived spike in prices earlier this year for guar, a key ingredient in hydraulic fracturing fluid.
Net income attributable to Baker Hughes fell 60 percent to $279 million, or 63 cents per share, in the third quarter from $706 million, or $1.61 per share, a year earlier.
Revenue rose 3 percent to $5.23 billion.
Profit on an adjusted basis was 73 cents per share.
Analysts had expected earnings of 84 cents per share on revenue of $5.44 billion, according to Thomson Reuters I/B/E/S.
Schlumberger Ltd (SLB.N), the world's largest oilfield services company, reported a higher quarterly profit on Friday. The company, which is far less reliant on North America, was lifted by its strength outside the volatile market.
Halliburton Co (HAL.N), the U.S. market leader and number-two worldwide, reported on Wednesday a weaker-than-expected adjusted profit.
Baker Hughes shares are down 3 percent so far this year, while Halliburton has gained 3 percent and Schlumberger has risen nearly 10 percent.
(Reporting by Swetha Gopinath in Bangalore and Braden Reddall in San Francisco)
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