Oil services company Allis Chalmers Energy Inc said its 2009 earnings growth may miss earlier projections, as the current global economic slowdown weighs on the sector's performance.
"It is difficult to project our growth in the market," Chief Executive Munawar Hidayatallah said by phone, but expected it to be close to Wall Street's targets.
He forecast revenue of $750 million and per-share earnings growth ranging from flat to up 10-15 percent. Analysts expect earnings, excluding items, of $1.40 per share on revenue of $740.9 million, according to Reuters Estimates.
On October 28, the company had said in a conference call that it expected earnings growth of 25-30 percent for 2009 over a year earlier. "At that time, we had not seen any real reduction in capital expenditure by exploration and production companies or rigs being laid down," Hidayatallah said.
He also projected fourth-quarter earnings in the range of 35 cents to 40 cents a share. Analysts on average expect 39 cents a share. The decline in energy prices from their highs in July has led many oil and gas companies to slash their capital expenditure budgets that would ultimately hit the oilfield services firms and drillers.
CEO Hidayatallah added that the company expects 85 percent of its revenue from land operations and the rest from offshore services next year. Apart from Gulf of Mexico and onshore operations, the company has interests in Argentina, Mexico, Bolivia and Brazil.
Hidayatallah said the company's international operations had long-term contracts with companies such as British Petroleum, Occidental Petroleum Corp and Brazil's Petrobras, putting it in a better position to tackle the slowdown than the marginal players in the industry.
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