Baker Hughes fourth-quarter net falls 32% on sharp drop in North American business
BY MELODIE WARNER
HOUSTON -- Baker Hughes fourth-quarter earnings fell 32% as the oilfield services company posted a sharp drop in profits from its North American business. Baker Hughes's North American pressure pumping business has been challenged as energy customers pull back on drilling for natural gas and shift their production to oil rich shale. Volatile natural gas and oil prices and an overbuild of pressure pumping capacity have also pressured profits in recent quarters.
Last month, Baker Hughes lowered its fourth-quarter outlook for North America revenue and margins, citing lower than expected onshore activity and continued pressure pumping price declines.
The North American segment, its largest geographic business by revenue, saw its pretax profit drop 47% during the quarter while revenue declined 9.5%. The segment's adjusted operating margins shrank to 9% from 15% a year ago. Its December forecast was adjusted operating margin of 8.5% to 9.5%.
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