Contract driller of oil and gas wells Helmerich & Payne, Inc. (HP) reported Thursday a 59% year-over-year drop in profit for the fourth quarter, hurt by a significant drop in quarterly revenues amid sharply lower rig utilization across operating segments.
Fourth Quarter Results
The Tulsa, Oklahoma-based company reported net income of $51.49 million or $0.48 per share for the fourth quarter, lower than $126.49 million or $1.18 per share in the prior-year quarter.
On average, 17 analysts polled by Thomson Reuters expected the company to earn $0.44 per share for the fourth quarter. Analysts' estimates typically exclude special items.
The results for the latest quarter include after gains from non-operating items of $0.01 per share, while the year-ago quarter results included $0.05 per share of the same gains. Non-operating items include gains on the sales of investment securities, gains from involuntary conversion of long-lived assets, and income from asset sales.
Total operating revenues for the quarter plunged to $362.22 million from $583.72 million in the same quarter last year, and missed nine Wall Street analysts' consensus estimate of $367.83 million.
Segmental Details
Operating revenues from U.S. land drilling for the fourth quarter plunged to $269.09 million from $437.38 million in the year-ago quarter. Segment operating income dropped to $90.14 million from $158.72 million last year, primarily due to significantly lower activity levels in the U.S. land drilling market. Average rig revenue per day increased to $25,895 from $25,034 a year ago. Rig utilization was 55%, sharply down from 98% in last year's fourth quarter.
Offshore drilling operating revenues for the quarter totaled $47.28 million, down from $50.08 million in the prior-year quarter. Segment operating income declined to $12.02 million from $13.66 million last year. Average rig revenue per day decreased to $47,547 from $52,452 a year ago. Rig utilization for the company's nine platform rigs was 78%, down from 89% last year.
Operating revenues for international land drilling more than halved to $43.10 million from $93.30 million in the same quarter last year. Segment operating loss was $6.25 million, compared to operating income of $18.57 million last year. Average rig revenue per day decreased to $29,406 from $37,691 a year ago. Rig utilization was 41%, sharply lower than 97% last year, unfavorably impacted by five idle rigs in the U.S. used for international bidding.
Other Metrics
Operating income for the fourth quarter plunged to $86.34 million from $190.71 million in the prior-year quarter, and total operating costs and expenses were $275.88 million, down from $393.01 million in the year-ago quarter.
Income tax provisions for the quarter more than halved to $31.09 million from $66.44 million in the comparable quarter a year ago.
The company ended the third quarter with cash and cash equivalents of $141.49 million compared to $121.51 million at end of the prior-year quarter.
In a statement, president and chief executive officer, Hans Helmerich said, "We are encouraged by signs of improvement in the U.S. land rig market. The Company's FlexRigs are clearly well suited for the more prolific shale plays and other horizontal and directional work that greatly benefits from our newer drilling technology. We are also pleased to be working in Mexico under a Schlumberger Integrated Project Management (IPM) contract with PEMEX where six of our FlexRigs are now operating."
Full Year Highlights
For fiscal 2009, Helmerich & Payne reported net income of $353.55 million or $3.32 per share, lower than $461.74 million or $4.34 per share in fiscal 2008. Analysts expected the company to report earnings of $3.24 per share for the full year.
Results for fiscal 2009 and 2008 include after-tax non-operating related income of $0.04 and $0.27 per share, respectively.
Total operating revenue for the full year declined to $1.89 billion from $2.04 billion posted last year. The Street was looking for full-year 2009 revenues of $1.89 billion.
Peer Performance
Among Helmerich & Payne's peers, Hamilton, Bermuda-based Nabors Industries Ltd. (NBR) reported in October a lower net income for the third quarter, hurt by weak demand. Net income of $29.5 million or $0.10 per share was sharply down from $194.0 million or $0.67 per share in the prior-year quarter. Quarterly revenues dropped to $803.57 million from $1.44 billion in the same quarter last year. However, Nabors sounded optimistic indicating higher rates and demand for its rigs in select markets.
Another peer, Sugar Land, Texas-based Noble Corp. (NE) reported in October a year-over-year increase in profit for the third quarter, helped by higher operating revenues. Net earnings grew to $421.6 million or $1.63 per share from $379.2 million or $1.42 per share in the prior-year quarter. Quarterly operating revenues increased to $905.64 million from $861.98 million in the same quarter last year.
Stock Quote
In Thursday's regular trading session, HP is currently trading at $37.00, down $1.18 or 3.09% on a volume of 0.38 million shares. In the past 52-week period, the stock has been trading in a broad range of $17.01 to $46.24.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.