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Baker Hughes beats profit estimates on international demand, raises dividend

Published 04/23/2024, 05:05 PM
Updated 04/23/2024, 05:56 PM
© Reuters. The logo of energy services firm Baker Hughes is displayed during the LNG 2023 energy trade show in Vancouver, British Columbia, Canada, July 12, 2023. REUTERS/Chris Helgren/File Photo

(Reuters) -Oilfield services firm Baker Hughes beat analysts' estimates for first-quarter profit on higher international drilling demand and increased its dividend.

Brent crude rose nearly 10% in the quarter on an average, prompting oil firms to drill more, creating demand for oilfield services and equipment offered by Baker Hughes and rivals.

International rig count, an indicator of future production, was up 5.4% at 965 on an average at the end of the first quarter, from a year earlier, according to Baker Hughes data.

Total revenue from its international segment was up at $2.79 billion in the quarter, compared with $2.59 billion a year earlier.

Earlier in the day, the company said it had received an order to supply equipment for the third phase of oil giant Aramco (TADAWUL:2222)'s gas network expansion project in Saudi Arabia.

Baker Hughes rounds out a quarter when the top three oilfield services companies' results were lifted by robust international activity.

SLB and Halliburton (NYSE:HAL) benefited from demand in their international operations that helped offset weakness in North America.

Total quarterly revenue from the North America segment fell to $990 million from $992 million, Baker Hughes said, as multi-year low natural gas prices forced operators in the U.S. to rein in activity.

The company also increased its quarterly dividend to 21 cents per share, from 19 cents per share a year earlier.

CEO Lorenzo Simonelli said Baker was "on-track to deliver 60%-80% of free cash flow to shareholders." The company repurchased $158 million of shares during the quarter.

© Reuters. The logo of energy services firm Baker Hughes is displayed during the LNG 2023 energy trade show in Vancouver, British Columbia, Canada, July 12, 2023. REUTERS/Chris Helgren/File Photo

Baker Hughes reported an adjusted profit of 43 cents per share for the quarter ended March 31, compared with analysts' average estimate of 40 cents, according to LSEG data.

Houston-based Baker's revenue rose 12.3% to $6.42 billion, topping estimates of $6.37 billion.

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