Halliburton Announces Third Quarter 2023 Results
-- Net income of $0.79 per diluted share. -- Revenue of $5.8 billion and operating margin of 17.9%. -- International revenue growth of 17% year on year. -- Repurchases of approximately $200 million of common stock. HOUSTON----October 24, 2023--
Halliburton Company (NYSE: HAL) announced today net income of $716 million, or $0.79 per diluted share, for the third quarter of 2023. This compares to net income for the second quarter of 2023 of $610 million, or $0.68 per diluted share and adjusted net income(1) , excluding the loss on transactions in Argentina, of $691 million, or $0.77 per diluted share(2) . Halliburton’s total revenue for the third quarter of 2023 was $5.8 billion, flat when compared to the second quarter of 2023. Operating income was $1.0 billion in the third quarter of 2023, a 3% increase when compared to the second quarter of 2023.
“Halliburton delivered an impressive third quarter and our margin strength demonstrated the power of our strategy. I am pleased with the stability of our North America business and the profitability of our International growth,” commented Jeff Miller, Chairman, President and CEO.
“Everything I see today strengthens my conviction in the long duration of this upcycle. Against this backdrop, we expect continued demand growth for oilfield services in 2024 and beyond.
“Halliburton delivered strong returns to our shareholders as demonstrated by more than $500 million of Free Cash Flow(3) and repurchases of approximately $200 million of common stock and $150 million of debt during the quarter,” concluded Miller.
Operating Segments
Completion and Production
Completion and Production revenue in the third quarter of 2023 was $3.5 billion, flat sequentially, while operating income was $746 million, an increase of $39 million, or 6%. Margins expanded sequentially, driven by international operations, while North American margins remained approximately flat to last quarter. These results were primarily due to increased stimulation activity internationally, higher cementing activity in the Eastern Hemisphere, and improved completion tool sales globally. These increases were partially offset by lower pressure pumping services in North America.
Drilling and Evaluation
Drilling and Evaluation revenue in the third quarter of 2023 was $2.3 billion while operating income was $378 million, both flat sequentially. Higher fluids activity in the Middle East/Asia and Latin America and increased wireline activity in Latin America and Europe/Africa were offset by decreased drilling-related services, lower project management activity, and decreased software sales in Mexico.
Geographic Regions
North America
North America revenue in the third quarter of 2023 was $2.6 billion, a 3% decrease sequentially. This decline was primarily driven by decreased pressure pumping services in U.S. land and lower well intervention services in the Gulf of Mexico. Partially offsetting these decreases was improved completion tool sales in the Gulf of Mexico.
International
International revenue in the third quarter of 2023 was $3.2 billion, a 3% increase sequentially.
Latin America revenue in the third quarter of 2023 was $1.0 billion, an increase of 5% sequentially. This increase was primarily due to increased pressure pumping services and fluids activity in Argentina, improved completion tool sales in Brazil, and higher project management and drilling-related services in Colombia and Ecuador. Partially offsetting these increases were lower software sales, decreased project management activity, and lower well construction services in Mexico.
Europe/Africa revenue in the third quarter of 2023 was $734 million, an increase of 5% sequentially. This increase was primarily driven by improved well construction services, higher completion tool sales, and improved wireline activity in Norway and higher completion tool sales in the Caspian area. Partially offsetting these increases was lower activity in Africa across multiple product service lines.
Middle East/Asia revenue in the third quarter of 2023 was $1.4 billion, flat sequentially. Higher well construction in Iraq, increased drilling-related services and improved completion tool sales in Qatar, and higher pressure pumping and fluid services in Asia were offset by decreased activity across multiple product service lines in Kuwait and India.
Other Financial Items
During the third quarter of 2023, Halliburton:
-- Repurchased $198 million of common stock.
-- Repurchased $150 million of debt across multiple senior notes, notes
due, and global debentures, using cash on hand.
-- Spent $23 million on our SAP S4 migration.
Selective Technology & Highlights
-- Halliburton introduced Obex EcoLock(R), a new compression-set packer
that helps prevent sustained casing pressure. The Obex EcoLock packer
serves as a cost-effective mechanical barrier to mitigate low pressure
gas or fluid migration and deliver isolation assurance. The Obex EcoLock
packer, the newest addition to the Halliburton family of compression-set
packers, is built upon the gas-tight, V0-rated Obex GasLock(R) packer
design. The Obex EcoLock packer provides V6-rated isolation and can
support multiple-stage cementing with optional integral cementing ports
and an internal closing sleeve.
-- Halliburton and PTT Exploration and Production Public Company Limited
(PTTEP) signed a Memorandum of Understanding (MoU) to co-innovate and
market digital transformation solutions for the energy industry in
Thailand, Malaysia, and Vietnam. Under the agreement, the two companies
will develop and provide advanced digital solutions services that address
energy industry challenges and help increase operational effectiveness
and efficiency. The first two solutions being launched are PTTEP's Well
Delivery Process (WDP), WellSafvy, and Advanced Production Excellence
(APEX) which are built on Halliburton's DecisionSpace(R) 365 suite of
applications and are now available to oil and gas operators in the
selected countries.
-- Halliburton introduced Intelevate(TM), a new data science-driven
platform that helps operators design, build, and operate end-to-end
electrical submersible pump (ESP) monitoring solutions. This application
can be customized for specific needs. The Intelevate platform from Summit
ESP(R) -- A Halliburton Service - seamlessly integrates historical
engineering and performance data with active operational information to
provide a holistic view of an operator's ESP system. The service
intelligently processes, analyzes, and models production data with
real-time visualization and reporting to develop a comprehensive
optimization plan, including remote changes and interventions, to achieve
production goals.
-- Halliburton introduced GuideStar(TM), a service that uses
high-resolution sampling to provide continuous, definitive survey
measurements for more precise wellbore positioning. The GuideStar service
enhances well delivery by increasing the understanding of the centerline
wellbore placement and reducing survey time. It enables proactive,
real-time steering decisions to help avoid a reduction in the rate of
penetration when landing a well or at critical intervals of the
wellbore.
-- Halliburton introduced the BaraFLC(R) Nano-1 wellbore sealant, a
nanocomposite suspension that boosts wellbore stability. The new sealant
works with Halliburton's existing conventional and high-performance
water-based fluid systems to create a tighter, more secure seal that
decreases fluid loss into the formation. Halliburton's BaraFLC Nano-1
sealant uses nanoparticles to reduce interaction between filtrate and
reactive shale formations, preventing pore pressure transmission. This
helps strengthen wellbore integrity, which can extend drilling time and
efficiency.
-- Halliburton introduced PulseStar(TM), a service that provides operators
with consistent, high-speed streaming of downhole data. The service
transfers high-resolution, real-time drilling and subsurface data at
extended depth to provide more efficient and consistent well delivery.
The PulseStar service uses telemetry for remote operations to minimize
human interaction and enhances on-bottom drilling time. It automatically
adapts to environmental changes for optimal data rate and detection. Its
artificial intelligence provides self-optimizing pulses to maintain high
data quality across the reservoir, and its advanced signal processing
allows downlink for two-way communication while drilling.
-- Halliburton introduced the FlexRite(R) Selective Access multilateral
completion system to address more complex and demanding well scenarios.
Multilateral systems maximize reservoir contact, creating cost and time
savings while also reducing the environmental footprint. The FlexRite
Selective Access system builds on over two decades of Halliburton
operational and technical excellence. It delivers the industry's highest
pressure ratings and can execute multilateral well strategies in complex
reservoir conditions. Through an innovative combination of stimulation
capability and through-completion selective intervention, the FlexRite
Selective Access system delivers life-of-well versatility to multilateral
installations.
(1) Adjusted net income is a non-GAAP financial measure; please see
reconciliation of Net Income to Adjusted Net Income in Footnote Table
2.
(2) Adjusted net income per diluted share is a non-GAAP financial measure;
please see reconciliation of Net Income to Adjusted Net Income in
Footnote Table 2.