Halliburton Announces Second Quarter Earnings
Halliburton announced that income from continuing operations for the second quarter of 2008 was $623 million, or $0.68 per diluted share. This compares to income from continuing operations for the second quarter of 2007 of $595 million, or $0.63 per diluted share. Second quarter 2008 results were negatively impacted by a $30 million charge related to a patent settlement and $5 million of acquisition-related expense for the Expro bid, offset by $25 million in gains related to the sale of two investments in the United States. The net impact of these items was $10 million. Second quarter 2007 results were favorably impacted by a $49 million gain related to the sale of an investment.
Halliburton’s consolidated revenue in the second quarter of 2008 was a record $4.5 billion, up 20% from the second quarter of 2007. All product service lines contributed to this increase, driven by both increased international activity and strengthening demand in the United States.
Consolidated operating income was $949 million in the second quarter of 2008 compared to $893 million in the second quarter of 2007. Both segments and all geographic regions contributed to the increase.
“I am very pleased with our results for the second quarter as we continue to show healthy expansion of our business on a worldwide basis,” said Dave Lesar, chairman, president, and chief executive officer.
Net income in the second quarter of 2008 was $507 million, or $0.55 per diluted share. This compares to net income of $1.5 billion, or $1.62 per diluted share, in the second quarter of 2007.
Completion and Production operating income in the second quarter of 2008 was $561 million, an increase of $6 million or 1% from the second quarter of 2007. Europe/Africa/CIS C&P operating income increased 39% with the most significant impact coming from increased activity in Africa. Middle East/Asia C&P operating income increased 19%, primarily due to increased activity related to the Khurais project in Saudi Arabia. North America C&P operating income decreased 13%, due to pricing declines and cost increases in the United States for production enhancement, partially offset by improved completion tools sales and services. Latin America C&P operating income increased 22% from higher vessel utilization and increased activity.
Drilling and Evaluation operating income in the second quarter of 2008 was $480 million, an increase of $132 million or 38% over the prior year second quarter. Europe/Africa/CIS D&E operating income increased 6%, benefiting from higher activity and improved performance of Baroid Fluid Services and wireline services across the region. Middle East/Asia D&E operating income increased 27% over the second quarter of 2007, primarily due to higher drilling and multilateral activity. Baroid Fluid Services also experienced strong results in the region. North America D&E operating income increased 72%, with improvement in all product service lines benefiting from increased drilling activity in the United States and improved performance of Baroid Fluid Services. This region’s second quarter 2008 results also reflect the sale of two investments discussed previously. Latin America D&E operating income increased 49% with additional deployments of equipment resulting in increased Sperry Drilling Services and wireline services activity. Landmark also contributed to the improved results.
Approximately $2.0 billion remains available under the company’s share repurchase program. Since the inception of the program, Halliburton has purchased 89 million shares for a total cost of approximately $3.0 billion.
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