(Reuters) - General Electric Co’s Baker Hughes on Tuesday said improving oil markets helped it post a third-quarter adjusted net profit versus a year-earlier adjusted loss, but earnings per share missed analysts’ forecasts by a penny.
Baker Hughes also expressed optimism for 2019 and beyond as international and offshore markets improve and new liquefied natural gas projects are being approved.
Third-quarter profit per share missed analyst estimates by 1 cent on weakness in its turbomachinery and process solutions business.
Shares of Baker Hughes had slid more than 3 percent shortly after its quarterly earnings report, but finished the day up 2.5 percent at $27.26.
Baker Hughes said the offshore sector, worst hit during the 2014 downturn, is recovering as international oil prices have climbed to around $75 a barrel. A rebound in rates companies receive for drilling services is expected by 2020.
“The offshore market is the strongest it has been in many years and the improving tender and order activity is an encouraging sign as we look out to 2019 and beyond,” Chief Executive Officer Lorenzo Simonelli said in a statement.
Baker Hughes sold its first blowout preventer since 2014 during the quarter, a sign demand for offshore equipment may be returning.
The company said it feels “very positive” about the LNG market outlook and it expects more projects to be approved in the second half.
Baker Hughes said it conservatively estimates 65 million tonnes per year of LNG to be approved by 2020.
Quarterly revenue in oilfield services, which accounts for over half of total sales, rose 12.5 percent from a year earlier to about $3 billion.
Baker Hughes has limited exposure to the North American pressure pumping sector. U.S. oilfield services firms have seen demand soften as producers cut spending due to transportation bottlenecks in the Permian basin.
Revenue from turbomachinery and process solutions dropped roughly 2 percent to about $1.40 billion.
Third quarter adjusted net income swung to a profit of $78 million, or 19 cents per share, from an adjusted loss of $7 million, or 2 cents per share, a year earlier.
Analysts had expected profits of 20 cents per share, according to Refinitiv data.
Total revenue rose to $5.67 billion from $5.30 billion.
Reporting by John Benny in Bengaluru and Liz Hampton in Houston; editing by Sriraj Kalluvilan and Phil Berlowitz