https://assets.capyfin.com/instruments/678fdc13234e27009c5d5d0b.png avatar
Helmerich & Payne
🇺🇸 NYSE:HP
View Company
OverviewEarningsDividends
•
Mar 31, 2020

Helmerich & Payne Q2 2020 Earnings Report

Helmerich & Payne experienced a net loss due to significant asset impairments amidst the COVID-19 pandemic and oil market challenges.

Key Takeaways

Helmerich & Payne reported a net loss of $421 million, or $(3.88) per diluted share, on operating revenues of $634 million for the quarter ended March 31, 2020. The results were impacted by a $563 million non-cash impairment charge. The company is focused on maintaining financial strength through cost controls and revised capital allocation policies.

U.S. Land revenue increased sequentially to $531 million, with operating gross margins increasing to $183 million.

A non-cash impairment charge of $563 million was incurred related to goodwill, less capable rigs, and excess equipment.

The company is reducing annual dividends by $200 million and capital expenditures by approximately $95 million.

H&P is focused on new commercial models, digital technology offerings, international presence, and cost management.

Total Revenue
$634M
Previous year: $721M
-12.1%
EPS
-$0.01
Previous year: $0.56
-101.8%
U.S. Land Revenue Days
17.27K
U.S. Land Active Rigs
86
Gross Profit
$82.6M
Previous year: $134M
-38.5%
Cash and Equivalents
$336M
Previous year: $244M
+37.8%
Free Cash Flow
$72.6M
Previous year: $65.7M
+10.5%
Total Assets
$5.18B
Previous year: $6.14B
-15.8%

Helmerich & Payne

Helmerich & Payne

Helmerich & Payne Revenue by Segment

Helmerich & Payne Revenue by Geographic Location

Forward Guidance

Helmerich & Payne anticipates challenges in the third fiscal quarter due to the impact of COVID-19 on the oil market. However, they expect positive operating gross margins for U.S. Land and Offshore Operations.

Positive Outlook

  • U.S. Land operating gross margins are expected to be between $90-$105 million, including $45 million from contract early termination compensation.
  • Offshore operating gross margins are expected to be between $4-$6 million.
  • Management contracts are expected to generate approximately $2 million in operating income.
  • Fiscal third quarter revenue for HP Technologies is expected to be between $4-$7 million.
  • Asset sales are expected to total $30 to $40 million in fiscal year 2020.

Challenges Ahead

  • The company expects to end the quarter below 70 rigs due to rig release notifications.
  • International Land operating gross margins are expected to be negative, between $(4)-$(6) million.
  • Gross capital expenditures are expected to be approximately $185 to $205 million.
  • General and administrative expenses for fiscal year 2020 are expected to be approximately $180 million, excluding any future one-time items
  • Depreciation is expected to be approximately $485 million

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

View Helmerich & Payne