HOUSTON — Shares of Halliburton rallied Tuesday after the oilfield services company reported its fourth-quarter profit rose 14 percent in a performance that exceeded Wall Street expectations.
The Houston-based company, which operates in an energy sector hit hard by months of plunging oil prices, also warned that 2015 will be a challenging year for its industry. It said it took $129 million in restructuring charges in the recently completed quarter to temper expected business declines.
Halliburton Chairman and CEO Dave Lesar said Tuesday morning during a conference call that his company's customers have chopped their capital expenditure budgets 25 percent to 30 percent, as they adjust their spending to deal with falling commodity prices.
He said the length of the downturn was hard to predict, but his company remains in "great financial position."
Halliburton said last month that it cut about 1,000 employees from its workforce in the Eastern hemisphere due to the tough market environment. A company spokeswoman said the cuts had nothing to do with its pending acquisition of rival oilfield services provider Baker Hughes.
Halliburton Co. did book $19 million in costs tied to that deal, a $34.6 billion acquisition the companies announced in November.
For the fourth quarter, Halliburton earned $901 million, or $1.06 per share, which was up from $793 million, or 93 cents per share, in the previous year's quarter.
Earnings adjusted for one-time gains and costs totaled $1.19 per share.
Analysts expected, on average, $1.11 per share, according to Zacks Investment Research.
The provider of drilling services to oil and gas operators posted revenue of $8.77 billion in the period, which met Street forecasts.
Operating earnings from the company's completion and production business jumped 30 percent to $991 million in the quarter, which helped balance an 18 percent drop from the drilling and evaluation side.
Halliburton shares rose 35 cents to $39.48 in afternoon trading Tuesday, while broader trading indexes slipped. The stock had declined more than 20 percent over the last 12 months before markets opened Tuesday.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on HAL at http://www.zacks.com/ap/HAL
Keywords: Halliburton, Earnings Report