Baker Hughes increases annual forecasts following Chart purchase and signals LNG recovery ahead
?U.S. Baker Hughes, a provider of oilfield services, raised its full-year forecasts Wednesday to reflect the benefits of its $13.6 billion acquisition of industrial equipment maker Chart Industries.
Lorenzo Simonelli, the CEO of Barclays, also spoke at the Barclays Annual Energy Conference, and expressed optimism about liquefied gas (LNG) market, where equipment demand is being pressured by a slow pace in new project sanctioning, as well as customer spending.
Simonelli stated that "we see an increasing visibility towards an LNG order recovery by 2027."
Early trading saw shares of the company up by 3.2%.
Baker Hughes completed the Chart acquisition in July, after receiving EU antitrust approval. The condition was that it would sell Chart's small-scale technology business and proprietary process technology.
Baker Hughes expects revenues of between $28.50 and $30.30 billion by 2026. This is an increase from the previous forecast of $26.65 to $28.05billion.
The company expects adjusted annual earnings before interest, tax, depreciation, and amortization (EBITDA) to be between $4.88 billion and $5.48billion, up from its previous forecast of $4.6billion to $5.1billion.
Simonelli stated that the company expects between 55% and 65% of Chart’s segment core profits to be realized in the fourth quarter. This is due both to the close of the deal mid-July, as well as Chart’s usual'seasonal' weighting towards the final quarter.
He added that the timing of LNG equipment volume and the soft demand for hydrogen are affecting near-term chart margins.
According to LSEG data, analysts expect the company to report a core profit of 5.09 billion dollars and revenue of 28.31 billion dollars in 2026.
(source: Reuters)
