BHGE announces 2Q19 results

Highlights

• Orders of US$6.6 billion for the quarter, up 15% sequentially and up 9% year-over-year.
• Revenue of US$6.0 billion for the quarter, up 7% sequentially and up 8% year-over-year.
• GAAP operating income of US$271 million for the quarter, increased 54% sequentially and increased more than three times year-over-year.
• Adjusted operating income (a non-GAAP measure) of US$361 million for the quarter, up 32% sequentially and up 25% year-over-year.
• GAAP diluted earnings per share of US$(0.02) for the quarter which included US$0.22 per share of adjusting items. Adjusted diluted earnings per share (a non-GAAP measure) were US$0.20.
• Cash flows generated from operating activities were US$593 million for the quarter. Free cash flow (a non-GAAP measure) for the quarter was US$355 million.

CEO comments

“We delivered a solid second quarter 2019 both commercially and operationally. The trends for our longer-cycle businesses remain intact. The LNG newbuild cycle is a strong positive for our company and our international Oilfield Services (OFS) business continues to be very successful. Our outlook for 2019 is unchanged and we remain focused on our priorities of gaining share, improving margins and delivering strong cash flows,” said Lorenzo Simonelli, BHGE Chairman and Chief Executive Officer.

“In the second quarter, we booked US$6.6 billion in orders, driven by year-over-year growth in three of our four segments. We delivered US$6.0 billion in revenue and adjusted operating income in the quarter was US$361 million.

“In Oilfield Services (OFS), we executed on our strategy to grow in key international markets, while in North America our production-levered portfolio is driving growth amid uncertain market conditions. We executed well on previously-announced wins, helping our customers achieve step-changes in efficiency on some of their most important projects.

“In Oilfield Equipment (OFE), we continue to enhance our offerings through Subsea Connect, and we are focused on technology, lowering project costs and delivering for customers. Flexible Pipe System orders were up significantly in the quarter compared to the lows of 2018, a good sign for future revenue growth.

“In Turbomachinery & Process Solutions (TPS), the second quarter saw the acceleration of activity in the LNG market. We have seen approximately 60 million tpy of new capacity reach Final Investment Decision (FID) since the fourth quarter of 2018, and the industry is on track to reach the 100 million tpy we outlined by the end of 2019. Also in the quarter, we delivered strong orders in our on and offshore production segment, securing important wins in India and Africa. We remain well positioned across multiple market segments, most importantly LNG, as more projects move towards positive FID this year.

“In Digital Solutions (DS), we achieved a major milestone in the quarter to strategically position our digital software business. We announced a joint venture with C3.ai, the premier company in the industrial Artificial Intelligence (AI) space. The partnership will help us deliver AI that is faster, easier, and more scalable to drive outcomes for our customers. By integrating our strong digital capabilities and oil and gas industry expertise with C3’s unique AI solutions, we will accelerate the overall digital transformation of this industry.

“In closing, we executed well in the second quarter, and we are encouraged by strengthening international markets and the strong LNG project pipeline. Going forward, we remain focused on our financial priorities and differentiating ourselves to drive higher returns across our portfolio,” concluded Simonelli.

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/01082019/bhge-announces-2q19-results/