Baker Hughes, a provider of oilfield services, beats Q2 earnings estimates

Baker Hughes reported a stronger-than-expected second quarter as the oilfield ?services and energy technology company benefitted from brisk demand ?for LNG equipment, gas infrastructure and power generation projects tied to ?growing electricity needs.

Earnings per'share' were 64 cents. This was higher than the 50 cents expected by analysts compiled by LSEG.

The adjusted earnings before taxes, depreciation, and amortization (a measure of operating profit) rose by 2%, to $1.23billion, exceeding the upper end of the company's guidance.

Baker Hughes stated that "favourable underlying fundamentals will support our confidence to?achieve the midpoint of the full-year guidance, as we continue managing through the Middle East uncertainty."

The company has raised its order outlook for the full-year Industrial and Energy Technology segment, reflecting its confidence in the demand for LNG and power generation equipment.

The quarter was marked by a significant increase in new business. Orders increased by 49% compared to the same period last year, reaching a new record of $10.5 billion. This includes a record order value of $7.1 billion for the industrial and energy technologies segment. Order backlog rose 19%, reaching a record high.

This helped to push the remaining performance obligations of the company, which measures the value signed contracts but not delivered, up to $40.1 billion, including a new record of $37.1 billion for the industrial and energy technologies segment.

The company said that it would be increasing its order outlook for the full year and the segment under Horizon 2 Growth Plan to more than $45. billion.

The second-quarter revenue fell by?2% compared to the year before, falling to $6.74 Billion. However, higher prices, productivity gains and cost cutting helped offset inflation. This in turn supported the?profit margins. The adjusted net income rose 3% to $640m. Lorenzo Simonelli, Chief Executive Officer, said that demand for data centers, upstream energy and gas infrastructure markets remained high, which helped the company overcome operational challenges. Operating cash flow increased by more than two-thirds from the previous year to $1.35billion, while free cash flows grew to $1.11billion from $239m. Reporting by Vallari Nair and Devika in Bengaluru, Editing by Devika Syamnath and Cynthia Osterman

(source: Reuters)