Halliburton Company (NYSE:HAL) recently announced its Q1 earnings for 2015 beating EPS estimates by $0.12. The company also beat expected revenues, reporting $7.05 billion compared to $6.89 billion estimates. However, the company has some bad news for its investors. Halliburton has reported an unprecedented decline in drilling activity. The effects were visible when the present quarter was compared with the same period last year. A net loss of $63 million was reported, making the EPS fall from $0.73 in the previous year to $0.49 in the present.
The CEO at Halliburton, Dave Lesar, did note that his company has lowered activity levels and is seeking price concessions, due to the decline in oil prices. The company is also expected to make the plunge in number of oil rigs until July. Halliburton, like many others in the oil sector, has cut its workforce by 10% in the past two quarters. This number is expected to increase as further oil rigs are temporarily decommissioned.
The President of Halliburton, Jeff Miller, stated that the worst has yet to come. As per his experience, he believes that such situations last for at least three quarters. With the second quarter already underway, since January 2015, oil prices have shown a small rise. He also indicated that once things get stable, his company will begin with the healing process and get back up to take the lead again.
Halliburton gets about two-thirds of its revenue from operations in North America. With the first quarter already reporting a decline of $0.2 billion, it is expected that the number would fall with successive quarters. Additionally, energy companies have also been pressing Halliburton to reduce fees, which will give it a further blow. The management has, however, hinted that further changes would be of smaller magnitudes.
Halliburton Company (NYSE:HAL) closed at $47.11 after gaining 0.13% on April 22, due to its 1Q2015. The company has 848 million shares being traded in the market, with a 52-week range of $37.21-$74.33.
