UPDATE 4-Halliburton Q1 beats, outlook better; sector down

* Q1 EPS ex-items of 28 cts tops Wall St view of 25 cts

* Revenue slips 4 pct to $3.76 bln

* Latin America weak, U.S. helped by natgas activity

* Shares fall 0.8 pct, in line with sector as oil drops

(Adds Iraq update, Q1 hiring, updates share price)

By Matt Daily and Braden Reddall

NEW YORK/SAN FRANCISCO, April 19 (BestGrowthStock) – Halliburton Co
(HAL.N: ), the second-largest oilfield services company, posted an
estimate-topping quarterly profit as North American strength made
up for Latin American struggles, and said its outlook had
improved.

Profit margins across the industry have suffered since
companies such as Halliburton and larger peer Schlumberger Ltd
(SLB.N: ) cut prices last year when their oil and gas producing
customers slashed spending on new projects.

Halliburton said U.S. natural gas drilling helped lift North
American sales above the year-earlier level.

“All the upside was North America,” said analyst Kurt Hallead
of RBC Capital, while margins were “weaker than everybody
expected” in the rest of the world.

Halliburton shares fell 0.8 percent to $31.40, giving up an
early gain, as weak oil prices weighed down the sector (.OSX: ).

The company said it had hired 1,200 people in the first
quarter, after cutting its workforce by 6,000 to 51,000 last year,
largely to cater to growing North American demand.

Halliburton expects North American margins to improve more
this quarter, as limited natural gas drilling growth is offset by
greater oil-targeted activity due to a healthier oil price.

Pricier oil also led to more activity by big exploration and
production companies across most international markets outside
Latin America, Chief Executive Dave Lesar said.

“I wouldn’t point to one particular area as being particularly
good or bad,” Lesar told analysts on a conference call. “The
indications are it should be increasing just about everywhere in
the Eastern Hemisphere.”

He said he expected a steady resurgence in international
activity for the industry in the second half of 2010 and 2011.

He also said there would be plenty of work to do in Iraq,
where Halliburton is building a presence, like Schlumberger.

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Column on Schlumberger in Iraq [ID:nN19256596]
Graphic on sector share movement http://link.reuters.com/bat48j

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LATAM DISAPPOINTMENT

Halliburton’s first-quarter net profit fell 46 percent to $206
million, or 23 cents per share, from $378 million, or 42 cents per
share, a year earlier.

Excluding a $31 million charge from Venezuela’s currency
devaluation and a $10 million tax-related charge there, earnings
per share were 28 cents. That topped the analysts’ average
forecast of 25 cents on Thomson Reuters I/B/E/S.

Revenue fell 4 percent to $3.76 billion, as expected.

Lesar called the Latin American results disappointing, citing
falling activity in Mexico and delays in new projects.

In Mexico, auditors have urged state oil monopoly Pemex
[PEMX.UL] to slash production estimates at the flagship
Chincotepec project, where Halliburton has service contracts.
[ID:nN16157981]

Halliburton is the first major oil services firm to report
results for the latest quarter. Weatherford Ltd (WFT.N: ) is set to
do so on Tuesday, followed by Schlumberger on Friday.

Improving cash flow has led to talk of how Halliburton will
deploy some of its money. One possibility is acquisitions to
expand its range of service offerings, such as its purchase of
Boots & Coots (WEL.A: ) announced this month. [ID:nN09104766]

(Reporting by Matt Daily in New York and Braden Reddall in San
Francisco; Editing by Maureen Bavdek, Derek Caney, Lisa Von Ahn,
Phil Berlowitz)

UPDATE 4-Halliburton Q1 beats, outlook better; sector down