Fox Business News’s Lori Rothman reported about Baker Hughes Incorporated (NYSE:BHI) in her earnings alert on Thursday. The mention has been made on how the oil field services company reported earnings per share that beat analysts’ expectations. As she said, Baker Hughes Incorporated (NYSE:BHI) has “reported an adjusted profit of $0.92 per share, better than the $0.9 a share estimate. Revenue $5.94 better than the $5.86 billion,” concluding “so the bottom line, Baker Hughes Incorporated (NYSE:BHI) beats expectations.”
The adjusted income per diluted share of $0.92 is under non-GAAP, whereas the GAAP net income per diluted share is $0.80, because of charges relating to litigation settlements for labour claims ($0.09 per diluted share) and costs associated with a foreign exchange loss related to the Venezuela currency devaluation ($0.03 per diluted share), according to the Baker Hughes Incorporated (NYSE:BHI)’s press release.
Revenue of $5.94 billion is 8.2% higher compared to the same period in last year and a record revenue for the company at the same time. Earnings were however up much more dramatically, from $240 million or 54 cents in the second quarter of the last year, to $353 million or 80 cents, or by noticeable 47%. The disproportionally strong rise in profits relative to the rise in revenues is explained by its turn to new technologies which reduce drilling time and reduce costs.
According to Reuters, Baker Hughes Incorporated (NYSE:BHI) Chief Executive Martin Craighead said that the technologies developed in the last year or two contribute between 35-50% to the company’s revenue, and added that “We predict strong growth in this area for the foreseeable future.” Only in the second quarter, the company launched 47 new products and services. Baker Hughes Incorporated (NYSE:BHI) said it expects profits from operations to rise by 15% in the third quarter, as both revenues and margins rise in its key North American market.
Baker Hughes Incorporated (NYSE:BHI) share price slid down by about 2.5%, as the share price stays at the highest levels for the past three years, up by a third year to date.