Halliburton said Monday its first-quarter profit slumped nearly 46 percent with the industry still recovering from last year's drop in oil drilling.
The Houston oil services company reported earnings of $206 million, or 23 cents a share, in the first three months of the year. That compares with $378 million, or 42 cents a share, in the prior-year period.
Revenue fell 4 percent to $3.76 billion, compared with the first quarter of last year.
Halliburton said it would have earned 28 cents a share excluding special charges related to the recent devaluation of Venezuela's currency.
Analysts, which typically exclude one-time items, had expected earnings of 25 cents a share on revenue of $3.76 billion.
U.S. drilling operations, which the company depends on for about 45 percent of its revenue, plunged in 2009. But the number of active rigs bounced back in the quarter with oil prices rising above $85 a barrel, and company revenues improved compared with the final three months of 2009.
"Barring any major economic disruption, the industry is likely to experience a steady resurgence in international activity in the second half of the year and into 2011," Halliburton CEO Dave Lesar said in a statement.
Service companies are expected to have a strong year with crude prices on the rise. Oil and gas producers are aggressively pursuing new petroleum sources around the world, and companies that help them pump and deliver crude will see a lot of extra business.
The number of rigs actively exploring for oil and natural gas in the U.S. rose in each of the first three months of the year to an average of 1,345. An increasing number of those rigs are searching for shale gas, a service-intensive operation that will likely multiply Halliburton's workload and revenue in coming years, according to Raymond James analyst J. Marshall Adkins.
And Halliburton, like its competitors, is growing. The company said earlier this month it would buy the company Boots & Coots, Inc. in a deal valued at $232 million. Boots & Coots specializes in pressure-control and emergency response services to control oil and gas fires.
Schlumberger Ltd., the world's biggest oilfield services company, recently announced it was buying Smith International Inc. for about $11 billion, following the acquisition by Baker Hughes Inc. of BJ Services Co. for $5.5 billion.
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