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Halliburton (HAL) Q2 Earnings In Line on International Growth
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Halliburton Company (HAL - Free Report) reported second-quarter 2024 adjusted net income per share of 80 cents, in line with the Zacks Consensus Estimate and above the year-ago quarter profit of 77 cents (adjusted). The robust numbers reflect strength in the international markets.
Meanwhile, revenues of $5.8 billion were $35 million higher than the corresponding period of 2023 but missed the Zacks Consensus Estimate of $6 billion due to weak performance in the North American region.
Inside Halliburton’s Regions & Segments
North American revenues dropped 8% year over year to $2.5 billion, which also failed to meet our projection of $2.6 billion. On the other hand, revenues from Halliburton’s international operations were up 8.1% from the year-ago period to $3.4 billion and also surpassed our estimate by $42.5 million.
Operating income from the Completion and Production segment was $723 million, up from the year-ago level of $707 million but slightly below our projection of $728.1 million. The division’s performance was buoyed by improving completion tool sales in the Eastern Hemisphere, better stimulation activity in Latin America, increased cementing activity in North America, to go with higher well intervention services internationally. These factors were partly offset by lower stimulation activity in U.S. onshore, a dip in completion tool sales in the Western Hemisphere and decreased artificial lift services in North America.
Drilling and Evaluation unit profit improved from $376 million in the second quarter of 2023 to $403 million in the corresponding period of 2024. Our model estimated the figure at $417.3 million. This performance could be attributed to higher drilling-related services in Europe, North America and Asia, rising wireline activity levels across the Western Hemisphere and Europe plus a pickup in international testing services. Partly offsetting these positives were lower drilling-related services in Latin America and Africa the decline in worldwide software sales and reduced wireline activity in Middle East/Asia and Africa.
Halliburton Company Price, Consensus and EPS Surprise
Halliburton reported second-quarter capital expenditure of $347 million, higher than our projection of $303 million. As of Jun 30, 2024, this Zacks Rank #4 (Sell) company had approximately $2.1 billion in cash/cash equivalents and $7.6 billion in long-term debt, representing a debt-to-capitalization ratio of 43.2. HAL also bought back $250 million worth its stock during the April-June period. The company generated $1.1 billion of cash flow from operations in the second quarter, leading to free cash flow of $793 million.
Halliburton — the world’s biggest provider of hydraulic fracking — noted that the company’s returns and cash flow were the key to its strong second-quarter results. As per HAL, its international business is experiencing solid demand amid high activity levels and equipment tightness across all major basins. The company believes that its service quality, sound strategy, depth of offerings and technological leadership will stand it in good stead for the future.
Important Energy Earnings So Far
While it's early in the earnings season, there have been a few key energy releases thus far. Let’s glance through a couple of them.
Liberty Energy (LBRT - Free Report) , the Denver-CO-based oil and gas equipment company, announced second-quarter 2024 adjusted earnings of 61 cents per share, which marginally beat the Zacks Consensus Estimate of 60 cents. However, LBRT’s bottom line underperformed the year-ago quarter’s reported figure of 87 cents due to a year-over-year increase in costs and expenses.
Ahead of the earnings release, Liberty’s board of directors announced a cash dividend of 7 cents per common share, payable on Sep 20, 2024, to its stockholders of record as of Sep 6. As part of its shareholder return policy, LBRT repurchased shares worth $30 million at an average price of $20.39 per share in the reported quarter. The company returned $41 million to its shareholders through share repurchases and cash dividends.
Meanwhile, energy infrastructure provider Kinder Morgan (KMI - Free Report) reported second-quarter adjusted earnings per share of 26 cents, in line with the Zacks Consensus Estimate. The bottom line was favorably impacted by strong financial contributions from the Natural Gas Pipelines, Products Pipelines and Terminals business segments. Moreover, KMI’s second-quarter DCF was $1.10 billion, up from $1.07 billion a year ago.
As of Jun 30, 2024, Kinder Morgan reported $98 million in cash and cash equivalents. Its long-term debt amounted to $28.5 billion at the quarter-end. For full-year 2024 KMI still anticipates a DCF of $5 billion ($2.26 per share) and an adjusted EBITDA of $8.16 billion, each indicating 8% growth from the previous year’s reported figures.
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Halliburton (HAL) Q2 Earnings In Line on International Growth
Halliburton Company (HAL - Free Report) reported second-quarter 2024 adjusted net income per share of 80 cents, in line with the Zacks Consensus Estimate and above the year-ago quarter profit of 77 cents (adjusted). The robust numbers reflect strength in the international markets.
Meanwhile, revenues of $5.8 billion were $35 million higher than the corresponding period of 2023 but missed the Zacks Consensus Estimate of $6 billion due to weak performance in the North American region.
Inside Halliburton’s Regions & Segments
North American revenues dropped 8% year over year to $2.5 billion, which also failed to meet our projection of $2.6 billion. On the other hand, revenues from Halliburton’s international operations were up 8.1% from the year-ago period to $3.4 billion and also surpassed our estimate by $42.5 million.
Operating income from the Completion and Production segment was $723 million, up from the year-ago level of $707 million but slightly below our projection of $728.1 million. The division’s performance was buoyed by improving completion tool sales in the Eastern Hemisphere, better stimulation activity in Latin America, increased cementing activity in North America, to go with higher well intervention services internationally. These factors were partly offset by lower stimulation activity in U.S. onshore, a dip in completion tool sales in the Western Hemisphere and decreased artificial lift services in North America.
Drilling and Evaluation unit profit improved from $376 million in the second quarter of 2023 to $403 million in the corresponding period of 2024. Our model estimated the figure at $417.3 million. This performance could be attributed to higher drilling-related services in Europe, North America and Asia, rising wireline activity levels across the Western Hemisphere and Europe plus a pickup in international testing services. Partly offsetting these positives were lower drilling-related services in Latin America and Africa the decline in worldwide software sales and reduced wireline activity in Middle East/Asia and Africa.
Halliburton Company Price, Consensus and EPS Surprise
Halliburton Company price-consensus-eps-surprise-chart | Halliburton Company Quote
Balance Sheet
Halliburton reported second-quarter capital expenditure of $347 million, higher than our projection of $303 million. As of Jun 30, 2024, this Zacks Rank #4 (Sell) company had approximately $2.1 billion in cash/cash equivalents and $7.6 billion in long-term debt, representing a debt-to-capitalization ratio of 43.2. HAL also bought back $250 million worth its stock during the April-June period. The company generated $1.1 billion of cash flow from operations in the second quarter, leading to free cash flow of $793 million.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Management Remarks & Outlook
Halliburton — the world’s biggest provider of hydraulic fracking — noted that the company’s returns and cash flow were the key to its strong second-quarter results. As per HAL, its international business is experiencing solid demand amid high activity levels and equipment tightness across all major basins. The company believes that its service quality, sound strategy, depth of offerings and technological leadership will stand it in good stead for the future.
Important Energy Earnings So Far
While it's early in the earnings season, there have been a few key energy releases thus far. Let’s glance through a couple of them.
Liberty Energy (LBRT - Free Report) , the Denver-CO-based oil and gas equipment company, announced second-quarter 2024 adjusted earnings of 61 cents per share, which marginally beat the Zacks Consensus Estimate of 60 cents. However, LBRT’s bottom line underperformed the year-ago quarter’s reported figure of 87 cents due to a year-over-year increase in costs and expenses.
Ahead of the earnings release, Liberty’s board of directors announced a cash dividend of 7 cents per common share, payable on Sep 20, 2024, to its stockholders of record as of Sep 6. As part of its shareholder return policy, LBRT repurchased shares worth $30 million at an average price of $20.39 per share in the reported quarter. The company returned $41 million to its shareholders through share repurchases and cash dividends.
Meanwhile, energy infrastructure provider Kinder Morgan (KMI - Free Report) reported second-quarter adjusted earnings per share of 26 cents, in line with the Zacks Consensus Estimate. The bottom line was favorably impacted by strong financial contributions from the Natural Gas Pipelines, Products Pipelines and Terminals business segments. Moreover, KMI’s second-quarter DCF was $1.10 billion, up from $1.07 billion a year ago.
As of Jun 30, 2024, Kinder Morgan reported $98 million in cash and cash equivalents. Its long-term debt amounted to $28.5 billion at the quarter-end. For full-year 2024 KMI still anticipates a DCF of $5 billion ($2.26 per share) and an adjusted EBITDA of $8.16 billion, each indicating 8% growth from the previous year’s reported figures.