Helmerich & Payne (HP) unveiled capital expenditure guidance after markets closed on Thursday as the provider of drilling products and rigs posted a decline in revenue for its fiscal fourth-quarter amid an over-spend on its exploration and production capital budgets.
The Tulsa, Ok.-based company reported operating revenue of $649.1 million in the three months ended Sept. 30, down from $696.8 million in the corresponding quarter of the prior year. The result missed analysts’ estimates for $650.9 million.
Contract drilling services generated the lion’s share of revenue, worth $645.8 million, down from $693.7 million a year earlier while other revenues were worth $3,291, up from $3,148.
Diluted earnings per share, meanwhile, came in at $0.37, up from $0.02 in the prior-year period, and sailing past the Street’s projection for $0.23.
“The company continued to perform efficiently despite a sizable pull-back in industry activity,” John Lindsay, chief executive of Helmerich & Payne, said. “The steep decline this past quarter is a result of the over-spend of E&P [exploration and production] capital budgets that occurred during the first six months of the calendar year.”
He added that reflective of recent trends and customer conversations, the company expects to see more stability in rig demand over the next couple of months and heading into the calendar 2020 year.
For the full year, the company is targeting fiscal 2020 capital expenditure to range between $275 million and $300 million.