Halliburton goes into the red as rising costs impact on UK margins

Global oil well firm operates from two locations in Angus

The UK operation of global oilfield services company Halliburton swung to a loss last year as rising costs impacted on the firm’s bottom line.

Halliburton, which supplies materials, services and equipment for gas and oil wells, has its UK headquarters in Aberdeen and operates from Montrose and Arbroath.

Turnover rose by 3.4% to £494.6 million for the year ending December 31 according to the accounts filed at Companies House.

Despite an increase in oil and gas activity, the firm made a pre-tax loss of £4.2m compared to a pre-tax profit of £27.1m the previous year.

In his strategic report, director David Johnston explained: “Sales growth, measured year on year, increased by 3.5% in 2017 (2016: decreased 23%) due to increased activity in the UK oil and gas market as well as increased sales of manufactured product and the provision of services to overseas affiliates.

“Operating margin, measured as operating profit as a percentage of revenue, reduced to -1.9%. Operating margins decreased in comparison with 2016 primarily due to the increase in operating cost.

“Return on invested capital, measured as operating profit as a percentage of net assets was -3.2% in 2017 (2016:

14.9%).

“The return on invested capital reduced in 2017 due to the increase in operating cost as discussed above.”

The Arbroath site at the Elliot Industrial Estate was subject to a number of redundancies three years ago, with 10 employees made redundant and a similar number of temporary workers released.

Halliburton employs more than 50,000 people worldwide and has a market cap of $39 billion.

Picture: Kris Miller. The entrance to the Halliburton site in Arbroath.