Weatherford 1Q Net Soars Amid Drilling Boom; 2Q View Cautious
First Published Monday, 23rd April 2012 11:54 pm - © 2012 Dow Jones
Dow Jones NEWSWIRES
Weatherford International Ltd.'s (WFT) first-quarter earnings soared as the oilfield-services company's North American business delivered higher revenue, though the bottom line still fell short of analysts' lofty expectations.
The company also forecast current-quarter earnings between 24 cents and 26 cents a share, missing the average 27-cent target from analysts polled by Thomson Reuters.
Despite Weatherford's revenue reaching new highs amid a boom in North American oil-and-gas development, the company's bottom line has lagged rivals because of charges and weakness in its international operations. The company had warned in February that seasonal increases in Canada would be offset by declines in Russia, the North Sea, Asia Pacific and areas of the central U.S.
The company in February also detailed accounting errors that would adjust previously reported financial results for 2010 and earlier by roughly $225 million to $250 million. In the wake of the restatements, Weatherford named John H. Briscoe as its new chief financial officer to replace Andrew P. Becnel, and said James M. Hudgins, its vice president for tax matters, would leave the company at the end of March.
Weatherford on Monday said severance costs added $25 million in charges for the latest quarter, while ongoing investigations by the U.S. government added $2 million in costs. The company also booked $40 million of discrete tax items to reflect new estimates of its tax burden and uncertainty about its tax position.
Weatherford reported a profit of $123 million, or 16 cents a share, up from $37 million, or 5 cents, a year earlier. Excluding items such as severance costs, earnings rose to 25 cents from 7 cents.
It February projection was adjusted earnings of about 30 cents a share, below Wall Street estimates at the time.
Revenue jumped 26% to $3.6 billion, falling slightly short of the $3.64 billion expected by analysts polled by Thomson Reuters.
Operating margin rose to 11% from 7.6%.
Weatherford's North America operations, which account for most of the company's top line, recorded a 29% revenue increase. In the Middle East/North Africa/Asia segment, revenue rose 5%.
Shares were off 1.5% at $13.48 after hours. The stock had declined 34% over the past year through Monday's close.
-By Melodie Warner and Drew FitzGerald, Dow Jones Newswires; 212-416-2283; firstname.lastname@example.org