Halliburton announced fourth quarter earnings of $921 million, or $1.00 a share when excluding one time items, this morning, in line with the Street’s expectations.
The oil servicer saw a strong return in North America as oil companies returned to the Gulf of Mexico’s deepwaters, sending revenue up 36.9% year-on-year to $7.1 billion.
“The improvement in the Gulf of Mexico in 2011 was encouraging,” Halliburton’s CEO Dave Lesar said. “We saw increased rig count as the year progressed, particularly in deepwater, as our customers’ success with permitting improved and they resumed operations. Our strategy of keeping our infrastructure intact has paid off, with our fourth quarter revenue now above pre-moratorium levels.”
However, the company faced pressure in EMEA markets. Delays in Iraq weighed on Halliburton, and a difficult pricing environment in Northern Africa pressured margins. Egypt and Algeria improved after difficultly in the beginning of 2012, while increased cement work in Angola bolstered results.
For 2012, the Houston-based company issued rather optimistic guidance, expecting margins in the mid- to high-teens in the Eastern Hemisphere and strong capital spending throughout the year.
“In 2012, we expect revenue growth in excess of rig count growth in both the Eastern and Western Hemispheres,” Lesar said. “We are proactively moving equipment from dry natural gas to liquids plays in North America in response to recent rig moves. We believe strongly that we will not experience a collapse of margins in North America and, as a result, we expect revenue and operating income will increase in 2012 in North America.
Full year revenue hit $24.8 billion, with operating income improving 57% to $4.7 billion.
Halliburton also said it was aggressively moving employees to regions where it could tap oil and liquids drilling, as prices and demand decline sharply for natural gas. Accrued employee benefits surged more than 20% to $862 million and the company said it had more than 70,000 employees at the end of the fourth quarter — up from more than 60,000 on September 30.