Halliburton (NYSE:HAL) slipped to a loss in the first quarter amid a large increase in reserves connected to litigation involving the Deepwater Horizon oil spill, while the oil and gas services company beat revenue projections as international growth offset weakness in North America.
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Chairman and CEO Dave Lesar said the company has “recently participated in court-facilitated settlement discussions with the goal of resolving a substantial portion of private claims” related to the 2010 Gulf of Mexico spill at a BP (NYSE:BP) well where Halliburton performed work.
“We are pursuing these settlement discussions because we believe that an early and reasonably-valued resolution is in the best interests of our shareholders,” Lesar said.
The Houston-based company recorded an $18 million loss, or two cents a share, in the latest quarter that included litigation-related charges $637 million, or 68 cents a share. In the year-earlier period, Halliburton reported per-share earnings of 68 cents, a $627 million profit.
Revenue rose 1.5% to $6.97 billion. International revenue jumped 21%, while North America revenue fell 11%.
Analysts estimated per-share earnings of 57 cents on revenue of $6.88 billion.
Halliburton’s margins have been weighed down by higher costs for fracking in oil-rich areas in North America. Meanwhile, demand for its services in natural-gas fields has declined.
Lesar said Halliburton’s North American business began to see increased customer activity and internal cost efficiencies in the first quarter.
Shares of Halliburton were up 3.3% at $38.45 in early morning trading Monday.