Oil Service Companies Reiterate Long-Term Growth Outlook

Dow Jones Newswire via Rig Zone ^ | October 21, 2008 | Brian Baskin

[thackney]

Major oilfield service companies are reaffirming their ability to increase profits over the long term, a rebuttal to a sharp sell-off in their shares.

Halliburton Co. on Monday said it posted a third-quarter net profit of $687 million excluding a charge related to a retirement of some debt and to a small acquisition. With the charge, the world's second-largest general energy service firm in terms of market capitalization had a loss of $21 million.

Per-share earnings not including the charge came in at 76 cents, slightly beating expectations.

Executives at Halliburton and other oil service companies say they expect business to grow in 2009, thanks to orders from international projects, despite plummeting oil prices and a paralyzed credit market. These firms are paid by energy companies such as Exxon Mobil Corp. to perform the bulk of the field work, ranging from seismic exploration to well maintenance.

"We've not experienced any business impact from equity and credit market volatility, and despite growing prospects of a global economic slowdown ... we continue to believe in the long-term fundamentals of the oil and gas industry," said Halliburton Chief Executive David Lesar.

International growth in oilfield services spending could slow next year, he added.

Lesar was echoing Schlumberger Ltd. CEO Andrew Gould, who gave similar remarks when his company, the world's largest energy service company, released earnings on Friday. Schlumberger's third-quarter earnings matched analysts' average estimate of $1.25 a share. Weatherford International Ltd., the fourth-largest service firm, beat expectations Monday with earnings of 55 cents a share. All three saw profits rise over the previous year.

[2banana]

I actually believe these guys. However, the Enron and Lehman (etc.) executives have made people very cynical...