Core Viewpoint - Baker Hughes has been awarded a significant contract by SONATRACH for a gas-boosting project at the Hassi R'Mel gas field in Algeria, which is crucial for enhancing Algeria's energy supply and supporting Europe's energy security [1][2][3]. Group 1: Project Details - The contract involves the supply of 20 compression trains utilizing Frame 5 gas turbine and BCL compressor technology, to be installed at three gas boosting stations within the Hassi R'Mel gas field [2][7]. - Hassi R'Mel is the largest gas field in Algeria, located 550 km south of Algiers, and is a key energy source for both Algeria and Europe [2][3]. Group 2: Strategic Importance - This project is part of Algeria's broader strategy to strengthen its position in the global energy market and emphasizes natural gas as a vital energy source for socio-economic development [3][7]. - Algeria became the second-largest gas supplier to Europe in 2023, enhancing its role in the continent's energy security, particularly for Italy, which is the largest importer of Algerian gas [3][7]. Group 3: Collaboration and Manufacturing - The project represents a collaboration between Baker Hughes and Tecnimont, leveraging their industrial expertise to deliver the gas-boosting stations [3][7]. - Manufacturing and testing of the compressor trains will occur at Baker Hughes' facilities in Italy [4].

ALGIERS, Algeria, May 23, 2024 (GLOBE NEWSWIRE) -- Baker Hughes (NASDAQ: BKR), an energy technology company, announced Thursday it was awarded a major contract from SONATRACH for a gas- boosting project for the Hassi R'Mel gas field in Algeria. The contract is part of a broader order awarded to a consortium between Baker Hughes and Tecnimont, part of technology and engineering group MAIRE. The signing ceremony took place in Algiers in the presence of the three company CEOs: Rachid Hachichi of SONATRACH, Lor ...

In its weekly release, Baker Hughes Company (BKR) stated that the U.S. rig count was higher than the prior week's figure. The rotary rig count, issued by BKR, is usually published in major newspapers and trade publications. Baker Hughes' data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry. The number of active rigs and its comparison with the week-ago figure indicates the demand trajectory for the company's oilfi ...

Core Insights - The U.S. rig count has decreased, indicating a slowdown in drilling activities within the oil and gas industry [1][3][4] - Baker Hughes' weekly data is crucial for energy service providers to assess the business environment and demand for oilfield services [2] Rig Count Data - The total U.S. rig count was 603 for the week ended May 10, down from 605 the previous week and significantly lower than 731 a year ago, suggesting reduced drilling activity [3] - Onshore rigs totaled 584, down from 587, while offshore rigs increased to 19 from 18 [4] - The oil rig count decreased to 496 from 499, and is down from 586 a year ago, far below the peak of 1,609 in October 2014 [4] - The natural gas rig count rose to 103 from 102, but is still below the year-ago figure of 141, and is nearly 93.6% lower than the all-time high of 1,606 in 2008 [5] - Vertical drilling rigs increased to 15 from 13, while horizontal/directional rigs decreased to 588 from 592 [6] - The Permian Basin's oil and gas rig count was 314, down from 316 and below the prior-year level of 353 [7] Market Outlook - West Texas Intermediate crude prices are near $80 per barrel, which is favorable for exploration and production, yet drilling activities are slowing as companies focus on shareholder returns [8] - Investors may consider energy stocks like Diamondback Energy, Inc. and Matador Resources Company for medium to long-term gains [9] Company Highlights - Diamondback Energy reported improvements in average productivity per well in the Midland Basin and expects to grow production volumes due to favorable commodity pricing [10] - Matador Resources, with a strong presence in the Delaware Basin, anticipates a 23% increase in oil production this year, supported by promising oil prices [11]

Baker Hughes Company (BKR) ), a leading energy technology company, has secured a substantial contract to supply gas technology equipment for the third phase of Saudi Arabia’s Master Gas System project. This latest development marks a significant step forward in the Kingdom's efforts to enhance its energy infrastructure and reduce carbon emissions.Advancing Gas Distribution InfrastructureBaker Hughes has been entrusted by Worley, acting on behalf of Aramco, to provide essential equipment for the Master Gas S ...

Key PointsOilfield services companies are in a supercycle that drives long-term value for shareholders.Valuations and yields are attractive relative to the broad market, and distributions are growing. Share repurchases are bringing down the share count and aiding shareholder value. 5 stocks we like better than SchlumbergerThe oilfield services industry is in a supercycle that has yet to play out. However, the Q1 results aligned with expectations and failed to spur individual names to new highs. The takeaway ...

Monty Rakusen/DigitalVision via Getty Images Baker Hughes (NASDAQ:BKR) is well-positioned for the next wave of energy production as global energy interests shift away from a resource mindset to a focus in emissions control. Baker Hughes offers a wide array of services that caters to the shift in the growing demand for natural gas and the gradual shift towards hydrogen fuel. Though Baker Hughes may experience some headwinds as operators turn away from heavy drilling programs to enhanced oil recovery, I d ...

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements for the first quarter ended March 31, 2024, show a 12% year-over-year increase in total revenue to $6.4 billion, while net income attributable to the company decreased to $455 million from $576 million, primarily due to a significant reduction in other non-operating income from equity securities, and cash flow from operations substantially increased to $784 million Q1 2024 vs Q1 2023 Key Financials (in millions, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | **Total Revenue** | $6,418 | $5,716 | | **Operating Income** | $653 | $438 | | **Net Income Attributable to Baker Hughes** | $455 | $576 | | **Diluted EPS** | $0.45 | $0.57 | | **Cash Flow from Operating Activities** | $784 | $461 | - The decrease in net income was primarily driven by a significant drop in 'Other non-operating income, net' to **$29 million** in Q1 2024 from **$386 million** in Q1 2023, largely due to a smaller gain from the change in fair value of certain equity investments compared to the prior year[8](index=8&type=chunk)[62](index=62&type=chunk) Financial Position Summary (in millions) | Metric | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | $37,141 | $36,945 | | **Total Liabilities** | $21,591 | $21,426 | | **Total Equity** | $15,550 | $15,519 | [Note 13: Revenue Analysis](index=18&type=section&id=NOTE%2013.%20REVENUE%20RELATED%20TO%20CONTRACTS%20WITH%20CUSTOMERS) Revenue by Segment and Product Line (in millions) | Segment / Product Line | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | **Oilfield Services & Equipment (OFSE)** | **$3,783** | **$3,577** | | - Well Construction | $1,061 | $1,061 | | - Completions, Intervention & Measurements | $1,006 | $909 | | - Production Solutions | $945 | $938 | | - Subsea & Surface Pressure Systems | $771 | $670 | | **Industrial & Energy Technology (IET)** | **$2,634** | **$2,138** | | - Gas Technology Equipment | $1,210 | $831 | | - Gas Technology Services | $614 | $591 | | - Industrial Products & Solutions | $992 | $685 | | - Climate Technology Solutions | $83 | $31 | | **Total Revenue** | **$6,418** | **$5,716** | - As of March 31, 2024, the company had Remaining Performance Obligations (RPO) of **$32.7 billion**, with the majority expected to be recognized as revenue over the next 5 years[151](index=151&type=chunk) [Note 14: Segment Performance](index=19&type=section&id=NOTE%2014.%20SEGMENT%20INFORMATION) Segment Revenue and Operating Income (in millions) | Segment | Q1 2024 Revenue | Q1 2023 Revenue | Q1 2024 Operating Income | Q1 2023 Operating Income | | :--- | :--- | :--- | :--- | :--- | | Oilfield Services & Equipment (OFSE) | $3,783 | $3,577 | $422 | $371 | | Industrial & Energy Technology (IET) | $2,634 | $2,138 | $330 | $241 | | **Total Segment** | **$6,418** | **$5,716** | **$752** | **$612** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported strong momentum in Q1 2024, with a 12% revenue increase driven by higher volumes in both the IET and OFSE segments, and the outlook remains positive, supported by a multiyear upstream spending cycle led by international and offshore markets, and a strong LNG project pipeline, while the company continues its transformation and cost-out initiatives and maintains a flexible capital allocation policy, evidenced by an increased dividend and share repurchases - The company generated revenue of **$6,418 million** in Q1 2024, a **12%** increase from Q1 2023, primarily driven by higher volume in IET from Gas Technology Equipment project execution and better activity in OFSE[45](index=45&type=chunk) - Management believes in a durable, multiyear upstream spending cycle that is less sensitive to commodity price swings and led by international and offshore markets[41](index=41&type=chunk) - The company remains optimistic about the global natural gas outlook, with a strong LNG project pipeline driven by energy demand growth and decarbonization efforts[43](index=43&type=chunk) - In Q1 2024, the company returned **$368 million** to shareholders through dividends and share repurchases, and increased its quarterly dividend to **$0.21 per share**[17](index=17&type=chunk) [Business Environment & Outlook](index=24&type=section&id=BUSINESS%20ENVIRONMENT) The business environment in Q1 2024 was characterized by relatively stable oil prices and a decrease in natural gas prices compared to the prior year, with the worldwide rig count declining by 5%, driven by a 15% drop in North America, while international rig counts grew by 5%, and the company expects North American activity to see a modest recovery in the second half of 2024, with solid growth in international spending throughout the year Average Oil & Natural Gas Prices | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Brent Oil Price ($/Bbl) | $82.92 | $81.07 | | WTI Oil Price ($/Bbl) | $77.50 | $75.93 | | Natural Gas Price ($/mmBtu) | $2.15 | $2.64 | Average Rig Count | Region | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | North America | 831 | 982 | (15)% | | International | 965 | 915 | 5% | | **Worldwide** | **1,796** | **1,897** | **(5)%** | - Outlook for 2024 includes a flattening of North American activity into Q2 before a modest recovery in the second half, and solid growth in international spending compared to 2023[19](index=19&type=chunk) [Results of Operations](index=26&type=section&id=RESULTS%20OF%20OPERATIONS) Total revenue for Q1 2024 increased by $702 million (12%) year-over-year, with the IET segment contributing $496 million and the OFSE segment $206 million to this growth, and total segment operating income rose by $139 million, driven by higher volume, price, and cost-out initiatives in both segments, which were partially offset by unfavorable business mix and inflationary pressures - OFSE revenue increased **6%** to **$3,783 million**, driven by a **$208 million** increase in international revenue, particularly in Europe/CIS/Sub-Saharan Africa and Middle East/Asia[215](index=215&type=chunk) - OFSE operating income grew to **$422 million** from **$371 million**, primarily due to higher volume, price, and cost-out initiatives[5](index=5&type=chunk) - IET revenue surged **23%** to **$2,634 million**, mainly from higher volume in Gas Technology Equipment[198](index=198&type=chunk) - IET operating income increased to **$330 million** from **$241 million**, driven by higher volume, price, and cost-out initiatives, partially offset by unfavorable mix and higher R&D spending[224](index=224&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintained a solid liquidity position with $2.7 billion in cash and cash equivalents as of March 31, 2024, with net cash from operating activities significantly increasing to $784 million, and key uses of cash included $333 million in capital expenditures, $210 million in dividends, and $158 million in share repurchases, while the company has a $3 billion undrawn revolving credit facility and expects the impact of the Pillar Two global minimum tax to be immaterial in 2024 Cash Flow Summary (in millions) | Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Operating | $784 | $461 | | Investing | ($269) | ($229) | | Financing | ($427) | ($250) | - The company increased its quarterly dividend to **$0.21 per share** and repurchased **5.4 million shares** for **$158 million** during Q1 2024[245](index=245&type=chunk)[264](index=264&type=chunk) - As of March 31, 2024, the company had no borrowings under its **$3 billion** committed unsecured revolving credit facility and no outstanding commercial paper[239](index=239&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's exposure to market risk has not materially changed since December 31, 2023, and for detailed disclosures, the report refers to the company's 2023 Annual Report - The company's exposure to market risk has not changed materially since the end of the previous fiscal year[282](index=282&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2024, with no material changes to internal controls over financial reporting during the quarter - Management concluded that as of the end of the period, the company's disclosure controls and procedures were effective at a reasonable assurance level[283](index=283&type=chunk) - No changes in internal controls over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, these controls[270](index=270&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to legal proceedings in the ordinary course of business, and a putative securities class action lawsuit related to C3.ai, Inc., which had named the company as a defendant, was amended to reassert claims after a prior dismissal, with the company currently unable to predict the outcome of these proceedings - In a securities class action related to C3.ai, Inc., claims against the company were dismissed on February 22, 2024, but plaintiffs filed an amended complaint on April 4, 2024, reasserting claims, and the outcome is currently unpredictable[55](index=55&type=chunk) - Management does not expect the ultimate outcome of currently pending legal proceedings to have a material adverse effect on the company's financial position, results, or cash flows[9](index=9&type=chunk) [Item 1A. Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2023 - The company's risk factors have not materially changed from those discussed in the 2023 Annual Report[271](index=271&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2024, the company repurchased 5.4 million shares of its Class A common stock for a total of $158 million under its publicly announced repurchase program, and as of March 31, 2024, approximately $2.1 billion remained authorized for future repurchases Q1 2024 Share Repurchases | Metric | Value | | :--- | :--- | | Total Shares Repurchased | 5.4 million | | Average Price Paid per Share | $29.32 | | Total Cost | $158 million | - As of March 31, 2024, the company had approximately **$2.1 billion** remaining under its share repurchase authorization[159](index=159&type=chunk)[285](index=285&type=chunk)

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $943 million, a 21% year-over-year increase, exceeding the midpoint of guidance due to stronger performance in IET [60] - GAAP diluted earnings per share were $0.45, with adjusted earnings per share increasing by 50% compared to the same quarter last year [60] - Free cash flow was robust at $502 million, with a target for full-year free cash flow conversion of 45% to 50% [63] Business Line Data and Key Metrics Changes - IET orders totaled over $2.9 billion, with non-LNG Gas Tech Equipment orders more than tripling year-over-year, highlighting the diversity of the customer base [71][72] - OFSE revenue was $3.8 billion, up 6% year-over-year, with EBITDA in the segment increasing by 11% year-over-year [70] - IET revenue for the quarter was $2.6 billion, a 23% increase from the prior year, driven by a 46% increase in Gas Tech Equipment revenues [73] Market Data and Key Metrics Changes - The company expects E&P spending to increase by high single digits this year, with a decline in North American gas basins partially offset by modest improvement in oil activity [25][26] - Global LNG demand is projected to grow by mid-single digits annually through the end of the decade, supported by a strong demand outlook [32][34] - The company anticipates continued upstream spending growth, particularly in offshore markets in Latin America and West Africa [27] Company Strategy and Development Direction - The company is focused on achieving 20% EBITDA margins for both OFSE and IET segments by 2025 and 2026, respectively, through operational improvements and cost efficiencies [75][92] - A three-pronged approach of transforming the core, investing for growth, and positioning for new energy frontiers is being employed to enhance profitability [77] - The company is well-positioned to capitalize on the transition towards gas and increasing investments in new energy and chemicals [44][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the orders range for 2024, with a strong pipeline of activity and growing customer confidence in gas infrastructure [3][4] - The company remains optimistic about achieving new energy orders between $800 million and $1 billion, reflecting a tripling of new energy orders since 2021 [39] - Management noted that the macroeconomic environment, including oil price dynamics and geopolitical risks, will influence the company's performance but does not alter the strategic outlook [23][24] Other Important Information - The company increased its quarterly dividend by $0.01 to $0.21, representing an 11% year-over-year increase, and repurchased $158 million of shares [22][64] - The balance sheet remains strong, with cash of $2.7 billion and a net debt to trailing 12-month adjusted EBITDA ratio of 0.8x [63] Q&A Session Summary Question: Can you discuss the annual order guidance for IET? - Management remains confident in the 2024 orders range, having booked over $2.9 billion in orders, including significant awards from Aramco and Black & Veatch [2][15] Question: What are the drivers for achieving 20% OFSE margins next year? - Management highlighted productivity, cost management, and price volume as key drivers, with a cost-out program in place to enhance efficiency [5][6][7] Question: How does the company view the competitive landscape in production optimization? - Management emphasized the company's strong capabilities in production optimization and the importance of mature asset management, which represents a significant opportunity [102][108] Question: What impact does the Saudi MSC reduction have on Baker Hughes? - Management sees the MSC reduction as an opportunity for growth in gas production and infrastructure, benefiting the IET business [112][114] Question: Can you elaborate on the non-LNG Gas Tech Equipment orders? - Management noted that non-LNG orders have tripled year-over-year, driven by strong demand across various end markets, including upstream and midstream sectors [123][125]

Baker Hughes Company (BKR) reported first-quarter 2024 adjusted earnings of 43 cents per share, which beat the Zacks Consensus Estimate of 40 cents. The bottom line also improved from the year-ago quarter’s level of 28 cents.Total quarterly revenues of $6,418 million beat the Zacks Consensus Estimate of $6,341 million. The top line also increased from the year-ago quarter’s level of $5,716 million.Strong quarterly results were primarily driven by significant contracts in the Oilfield Services and Equipment ...