Helmerich & Payne Inc's quarterly profit missed market estimates, but the onshore oil and gas driller inked contracts to build more of its highly mobile rigs that are in demand as the industry shifts toward more oil- and liquids-rich prospects.
"The major shift across the industry towards oil- and liquids-rich plays is increasingly employing unconventional drilling techniques to conventional reservoirs," Chief Executive Hans Helmerich said in a statement. A greater number of drillers are applying horizontal well paths - an unconventional way of drilling, which requires highly specialised rigs, such as Helmerich & Payne's FlexRigs.
"We continue to see material upside to land driller estimates for this year and next," Bernstein Research analyst Scott Gruber wrote in a note. The company said it signed deals to build and operate eight more FlexRigs. As of April 28, it had 240 land rigs in the US
"We continue to see H&P as the best-positioned North American contract driller, given its industry-leading utilisation and rig fleet," BMO Capital's Michael Mazar said. Helmerich & Payne's profit, above estimates for the past few quarters, lagged on higher international expenses from disruptions in the Middle East and North Africa.
The results come two days after the world's largest land-rig contractor Nabors Industries posted quarterly results hit by weather-related delays, unrest in Yemen and labour problems in Oman. The Tulsa, Oklahoma-based company's January-March net income was $98.8 million, or 91 cents a share, compared with $46.7 million, or 43 cents a share, a year ago.