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Baker Hughes Earnings Off, Cutting Jobs

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&ampP spending level that could be down as much as 10% from 1998 levels.

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