UPDATE 3-Weatherford sinks to loss, North America firm

* Q1 loss of 5 cts/share, adjusted EPS 6 cents

* Revenue rises 4 pct to $2.34 bln vs est $2.54 bln

* Shares up 3 pct after underperforming rivals this year
(Rewrites with CEO comment, analyst, share price)

NEW YORK/SAN FRANCISCO April 20 (BestGrowthStock) – Weatherford Ltd
(WFT.N: ), one of the top four oilfield service companies, posted
a quarterly loss due to slack demand outside North America, but
expects the Eastern Hemisphere to drive growth over the next
year.

While first-quarter results fell a bit short of Wall Street
expectations, the company’s depressed shares rose more than 3
percent on Tuesday as analysts welcomed its
better-than-expected profit margins.

Sales and margins for oilfield service companies collapsed
over the past 18 months as energy companies slashed spending on
new projects, but a resurgence in drilling in the United States
helped offset that weakness so far this year.

Yet, like larger rival Halliburton Co (HAL.N: ), Weatherford
sees little North American growth in the next year and a half,
while international markets outside Latin America should do
well, Chief Executive Bernard Duroc-Danner said.

“A number of our traditional core markets should drive
higher activity: Algeria, Libya, Kuwait, Oman, Russia, Iraq,
China, Australia, to single out a few, should show the most
growth,” Duroc-Danner told analysts on a conference call.

In Iraq, he said Weatherford had 1,000 people working to
get nine drilling operations up and running by July.

The company reported a first-quarter net loss of $40
million, or 5 cents a share, compared with a profit of $164.8
million, or 23 cents a share, last year.

Excluding charges from Venezuela’s currency devaluation, an
executive retirement plan and severance and investigation
costs, adjusted profit was $41.5 million, or 6 cents a share —
a result the company expects to match this quarter.

First-quarter revenue rose 4 percent to $2.34 billion.

According to Thomson Reuters I/B/E/S, the company earned a
quarterly profit of 8 cents per share, compared with estimates
that averaged 9 cents per share, on revenue of $2.54 billion.

The Geneva-based company posted profits in Europe, West
Africa, the former Soviet Union and Latin America tumble by
more than 50 percent, while North American profits slipped a
more modest 9 percent.

“The quarter was entirely driven by heroic (North American)
results,” but the rest of the world “was collectively a tale of
despair and lamentation,” Bill Herbert, analyst with Simmons &
Co International, said in a note to investors.

On Monday, Halliburton posted better-than-expected profit
driven by North America. [ID:nN19173881] Industry leader
Schlumberger Ltd (SLB.N: ) reports on Friday.

Weatherford shares, down 9 percent in 2010 versus a gain of
8 percent in the Philadelphia Stock Exchange oil service index
(.OSX: ), rose 3.4 percent to $16.83 in early trading.

UBS analyst Angie Sedita said Weatherford was trading at a
25 percent discount to its peers, and maintained a ‘buy’ rating
on the stock. She said first-quarter operating margins of 12.6
percent compared well with her 10 percent estimate.

Duroc-Danner, noting how much profits had suffered, pointed
out that Weatherford’s international and North American
operating margins were both at 41 percent of their highs.

“It may be only coincidence,” he said.

Stock Market Money

(Reporting by Matt Daily in New York, Thyagaraju Adinarayan
in Bangalore, and Braden Reddall in San Francisco; Editing by
Dave Zimmerman and Derek Caney)

UPDATE 3-Weatherford sinks to loss, North America firm