Baker Hughes Earnings Off, Cutting Jobs
Baker Hughes said operating earnings before one-time charges for
the third calendar quarter will be roughly half of the 36
cents/share Wall Street consensus. Baker Hughes, which merged with
Western Atlas last month , said continuing declines in activity in
the Western Hemisphere, emerging softness in several Eastern
Hemisphere markets and modest price erosion due to activity
declines are the reason.
Additionally, hurricane and tropical storm delays in the Gulf of
Mexico and a one-quarter overlap of corporate expenses from the
Western Atlas merger will also hurt earnings. Earlier this month,
Baker changed its fiscal year-end from Sept. 30 to Dec. 31.
Baker has said it will take a merger and activity related charge
in the third quarter, and the company will cut more than 2,000
jobs, about 6% of total headcount. The company cut 700 jobs in the
second quarter. The company said it is sizing itself for a 1999
upstream E&P spending level that could be down as much as 10%
from 1998 levels.
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