Houston oil field service company Halliburton said Tuesday that it closed 2019 with a $1.1 billion loss amid an ongoing shale slump in the United States that has weakened demand for hydraulic fracturing and related services.
The loss compare to a nearly $1.7 billion profit in 2018. Halliburton reported $22.4 billion in revenue for the year, a 7 percent decrease compared to $24 billion in revenue during 2018.
In a statement, the company’s CEO Jeff Miller said North America revenue decreased by 21 percent sequentially in the fourth quarter and by 18 percent for the full year as a result of reduced customer activity and pricing. The company, he said, is responding with structural changes that emphasize improving margins and returns over growth.
“While we expect customer spending in North America to be down again this year, we will continue executing our playbook, implementing our service delivery improvement strategy, and focusing on maximizing our returns,” Miller said.
Oil field service companies typically see reduced activity in the fourth quarter as their customers, exploration and production companies, exhaust their end-of-year drilling and completion budgets.
Looking at Halliburton’s performance in the fourth quarter, the company reported a $1.7 billion loss compared to the $668 million profit in 2018.
The company had reported $5.2 billion of revenue during the fourth quarter, a 13 percent drop from $5.9 billion of during the fourth quarter one year prior.
Despite market contraction in U.S. shale, offshore and international markets remain a silver lining for Halliburton. The company reported that its international business grew by 10 percent during the fourth quarter and for the full year in 2019.
“Increased activity, disciplined capital allocation, pricing improvements, and our ability to compete for a larger share of high-margin services should lead to improvement in our international margins in 2020,” Miller said.
Founded in 1919 and headquartered in Houston, Halliburton closed 2018 with more than 60,000 employees in 40 nations.
The Houston company has since reported laying off hundreds of employees across the United States. An updated headcount is expected to be released over the few weeks.
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