Summary
Baker Hughes Company reported a significant net loss of $10.21 billion ($15.64 per share) for the first quarter of 2020, a stark contrast to the $32 million net income ($0.06 per share) in the same period last year. This dramatic swing was primarily driven by a massive goodwill impairment charge of $14.77 billion, stemming from the severe downturn in oil and gas prices and the economic uncertainty caused by the COVID-19 pandemic. Revenue also saw a slight decline of 3% to $5.43 billion from $5.62 billion year-over-year, impacted by reduced activity in Digital Solutions and Turbomachinery & Process Solutions segments. Despite the significant loss, the company maintained a solid liquidity position with $3.0 billion in cash and cash equivalents and an undrawn $3 billion revolving credit facility. Management is actively taking steps to navigate the challenging market, including a $1.8 billion restructuring plan to align operations with anticipated activity levels and preserve cash. The outlook for the oil and gas industry remains volatile, with expectations of significant declines in North America drilling and completion spending.
Financial Highlights
39 data points| Revenue | $5.42B |
| SG&A Expenses | $675.00M |
| Operating Expenses | $21.48B |
| Operating Income | -$16.06B |
| Net Income | -$10.23B |
Key Highlights
- 1Reported a net loss attributable to Baker Hughes Company of $10.21 billion for Q1 2020, a significant deterioration from a $32 million net income in Q1 2019.
- 2Recorded a substantial goodwill impairment charge of $14.77 billion, significantly impacting profitability.
- 3Total revenue decreased by 3% to $5.43 billion in Q1 2020 compared to $5.62 billion in Q1 2019, driven by volume declines in Digital Solutions and Turbomachinery & Process Solutions.
- 4The company implemented a $1.8 billion restructuring plan to align operations with anticipated activity levels and market conditions.
- 5Maintained a strong liquidity position with $3.0 billion in cash and cash equivalents and an undrawn $3 billion revolving credit facility.
- 6Experienced a 9% decrease in worldwide rig count to 2,055 in Q1 2020 compared to Q1 2019, with a 20% decline in North America.
- 7Oilfield Services segment showed revenue growth of 5% to $3.14 billion, driven by increased international activity, while other segments experienced revenue declines.