Baker Hughes forecasts higher margins on strong order backlog

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October 23, 2024 11:44 AM EDT

FILE PHOTO: The logo of energy services firm Baker Hughes is displayed during the LNG 2023 energy trade show in Vancouver, British Columbia, Canada, July 12, 2023. REUTERS/Chris Helgren/File Photo

(Reuters) - Baker Hughes on Wednesday forecast continued pretax margin gains in the fourth quarter and next year after beating Wall Street estimates for its third-quarter profit.

Shares of the company were trading 3.5% higher.

The company's upbeat outlook followed more than doubling of orders in its non-LNG gas technology equipment and margin gains in oilfield services and LNG equipment.

The company said several LNG projects were progressing towards final investment decision in the United States and internationally in 2025, providing confidence that its new energy orders will continue to grow.

The company also expects offshore activity to remain at stable levels.

"We feel good about 2025 with most segments similar to 2024 showing growth," said CEO Lorenzo Simonelli on the earnings call.

Given these tailwinds and operational improvements, Baker Hughes expects fourth-quarter total EBITDA of about $1.26 billion at the midpoint of its forecast range.

The company said it remained on track to achieve its 20% margin target for 2026.

(Reporting by Mrinalika Roy in Bengaluru; Editing by Maju Samuel)


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