Halliburton profit falls 12pc
Halliburton profit falls 12pc

Halliburton Co says its third-quarter net income has fallen 12 per cent as drilling activity declined and costs rose in its core North American business.

The Houston energy services company earned $US602 million ($A582.91 million), or 65 US cents per share, down from $US683 million, or 74 cents a share, a year ago. Revenue rose 9 per cent to $US7.11 billion. That was the smallest year-over-year revenue growth since the first quarter of 2010.

The results released on Wednesday fell short of Wall Street expectations, according to a poll by FactSet.

Halliburton is a major provider of hydraulic fracturing, or "fracking," services that unlock oil and natural gas from underground shale deposits. That technology helped boost natural gas production in the US by about 20 per cent between 2007 and 2011, according to data from the Energy Department. Halliburton's revenue rose more than 60 per cent in the same period.

But the boom in production has squashed prices. Natural gas prices were down 29 per cent in the latest quarter compared with a year ago as US supplies remained high.

Halliburton has a bigger chunk of its business in North America than its peers, so it is feeling a bigger pinch as customers pull back or turn their focus to drilling for oil.

The number of on-land oil rigs rose three per cent in North America during the summer quarter as oil prices rose nine per cent. But that was not sufficient to offset the decline in natural gas drilling.

Overall, revenue fell five per cent in North America. Dave Lesar, the company's chairman and chief executive, said Halliburton expected "the next couple of quarters to be pretty bumpy" in North America.

Costs rose due to higher prices for materials used in fracking, and disruptions in production caused by Hurricane Isaac.

Halliburton shares rose 76 cents to close at $US35.32 on Wednesday.

The West Australian

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