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Investing.com -- Shares of Helmerich & Payne (NYSE:HP) tumbled 15% after the company reported first-quarter revenue that fell short of Wall Street expectations, alongside concerns regarding its international operations. The oil and gas drilling company disclosed a revenue of $677.3 million, missing the consensus estimate of $691.49 million.
The Tulsa-based firm reported earnings per share (EPS) of $0.71 for the quarter ended December 31, 2024, slightly above the analyst prediction of $0.69. However, this was overshadowed by the revenue miss and the company’s performance compared to the same quarter last year, where it reported higher revenue of $694 million and net income of $75 million, or $0.76 per diluted share.
Helmerich & Payne’s results reflected a mixed operational picture. While the company’s North America Solutions segment maintained a stable rig count and recognized revenue per day of $38,600 with associated direct margins of $19,400 per day, the quarterly operating income and direct margins in this segment saw a decrease compared to the previous fiscal quarter.
The company also completed the exportation of eight super-spec FlexRigs into its Saudi Arabia operations and declared a quarterly cash dividend of $0.25 per share. On January 16th, Helmerich & Payne completed the acquisition of KCA Deutag, aiming to establish itself as a global leader in onshore drilling.
Despite these developments, President and CEO John Lindsay (NYSE:LNN) noted the cautious market sentiment due to economic and geopolitical uncertainties. He also mentioned that the results in the International Solutions and Offshore Solutions segments are expected to improve significantly in the second fiscal quarter, partly due to the recent KCA Deutag acquisition.
ATB Capital Markets analyst Waqar Syed commented on the company’s outlook, stating, "By our estimates, management’s outlook for KCA-Deutag is below where Street expectations are currently and that could pressure the stock." Syed pointed out that the guidance for the second fiscal quarter EBITDA is below consensus forecasts, even considering the KCA Deutag acquisition.
Investors reacted negatively to the news, with concerns about the integration of KCA Deutag and the potential for the company’s performance to lag behind expectations. Helmerich & Payne’s stock movement today reflects these investor sentiments as they digest the company’s current position and future prospects.
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