Hydril (NASDAQ:HYDL)
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Hydril (Nasdaq:HYDL) expects its third quarter 2006 earnings to be in
the range of $0.79 - $0.84 per diluted share, which is below previous
expectations, due primarily to greater than expected premium connection
inventory reductions by U.S. distributors.
In the United States and Canada, Hydril sells premium connections
through pipe distributors, who purchase and hold inventory for sale to
end-users. While end-user consumption of premium connections in the
field has been fairly stable, concerns over natural gas and steel prices
have led to inventory de-stocking, with distributors purchasing fewer
premium connections than they are selling to end-users. The third
quarter decline in distributor inventories of premium connections was
greater than we previously expected.
Chris Seaver, Hydril's President and CEO, stated "Based on what we are
seeing in the market today, we expect domestic premium connection
revenue to stabilize near the third quarter levels through the end of
the year. In the longer term, the fundamental business drivers have not
changed, the U.S. deep formation rig count continues to be strong, and
we expect revenues to increase when inventories stabilize, which we
expect sometime near year-end. The international portion of our premium
connection business continues as we expected, and demand continues to
increase in our pressure control segment."
Hydril's pressure control capital equipment backlog ended the quarter at
approximately $289 million, up from $266 million at the end of the
second quarter, and up from $61 million at the end of the third quarter
of 2005.
Chris Seaver, President and CEO, will present at the IPAA OGIS
Investment Symposium on Wednesday, October 4, at 2:15 p.m. PDT (4:15
p.m. CDT; 5:15 p.m. EDT). To listen to the live or replay webcast,
access the presentation from www.hydril.com
and click on the presentation icon on the home page. The live or replay
webcast can also be accessed from http://www.investorcalendar.com/CEPage.asp?ID=109780.
Management will discuss financial results for the company’s
third quarter ending September 30, 2006 in a conference call currently
scheduled for October 31, 2006.
Hydril, headquartered in Houston, Texas, is engaged worldwide in
engineering, manufacturing and marketing premium connection and pressure
control products used for oil and gas drilling and production.
Forward-Looking Statements
This press release contains forward-looking statements concerning
expected future results. These statements relate to future events and
the company’s future financial performance,
including the company’s business strategy and
product development plans, and involve known and unknown risks,
uncertainties and assumptions. These risks, uncertainties and
assumptions, many of which are more fully described in Hydril Company’s
Quarterly Report on Form 10-Q for the quarter-ended June 30, 2006 filed
with the Securities and Exchange Commission include but are not limited
to, the impact of changes in oil and natural gas prices and worldwide
and domestic economic conditions on drilling activity and demand for and
pricing of Hydril’s products, the risks
associated with fixed-price contracts, the loss of distribution
or change to distribution methods or inventory practices for premium
connections in the U.S. and Canada, competition from steel mills,
limitations on the availability of pipe for threading, the impact of
imports of tubular goods and of international and domestic trade laws,
factors that could cause our results to vary significantly from quarter
to quarter, the consolidation of end-users, intense competition in our
industry, the risks associated with international operations, the
ability to attract and retain skilled labor, and Hydril’s
ability to successfully develop new technologies and products and
maintain and increase its market share. These factors may cause Hydril’s
or the industry’s actual results, levels of
activity, performance or achievements to be materially different from
those expressed or implied by the forward-looking statements.
Hydril (Nasdaq:HYDL) expects its third quarter 2006 earnings to be
in the range of $0.79 - $0.84 per diluted share, which is below
previous expectations, due primarily to greater than expected premium
connection inventory reductions by U.S. distributors.
In the United States and Canada, Hydril sells premium connections
through pipe distributors, who purchase and hold inventory for sale to
end-users. While end-user consumption of premium connections in the
field has been fairly stable, concerns over natural gas and steel
prices have led to inventory de-stocking, with distributors purchasing
fewer premium connections than they are selling to end-users. The
third quarter decline in distributor inventories of premium
connections was greater than we previously expected.
Chris Seaver, Hydril's President and CEO, stated "Based on what we
are seeing in the market today, we expect domestic premium connection
revenue to stabilize near the third quarter levels through the end of
the year. In the longer term, the fundamental business drivers have
not changed, the U.S. deep formation rig count continues to be strong,
and we expect revenues to increase when inventories stabilize, which
we expect sometime near year-end. The international portion of our
premium connection business continues as we expected, and demand
continues to increase in our pressure control segment."
Hydril's pressure control capital equipment backlog ended the
quarter at approximately $289 million, up from $266 million at the end
of the second quarter, and up from $61 million at the end of the third
quarter of 2005.
Chris Seaver, President and CEO, will present at the IPAA OGIS
Investment Symposium on Wednesday, October 4, at 2:15 p.m. PDT (4:15
p.m. CDT; 5:15 p.m. EDT). To listen to the live or replay webcast,
access the presentation from www.hydril.com and click on the
presentation icon on the home page. The live or replay webcast can
also be accessed from
http://www.investorcalendar.com/CEPage.asp?ID=109780.
Management will discuss financial results for the company's third
quarter ending September 30, 2006 in a conference call currently
scheduled for October 31, 2006.
Hydril, headquartered in Houston, Texas, is engaged worldwide in
engineering, manufacturing and marketing premium connection and
pressure control products used for oil and gas drilling and
production.
Forward-Looking Statements
This press release contains forward-looking statements concerning
expected future results. These statements relate to future events and
the company's future financial performance, including the company's
business strategy and product development plans, and involve known and
unknown risks, uncertainties and assumptions. These risks,
uncertainties and assumptions, many of which are more fully described
in Hydril Company's Quarterly Report on Form 10-Q for the
quarter-ended June 30, 2006 filed with the Securities and Exchange
Commission include but are not limited to, the impact of changes in
oil and natural gas prices and worldwide and domestic economic
conditions on drilling activity and demand for and pricing of Hydril's
products, the risks associated with fixed-price contracts, the loss of
distribution or change to distribution methods or inventory practices
for premium connections in the U.S. and Canada, competition from steel
mills, limitations on the availability of pipe for threading, the
impact of imports of tubular goods and of international and domestic
trade laws, factors that could cause our results to vary significantly
from quarter to quarter, the consolidation of end-users, intense
competition in our industry, the risks associated with international
operations, the ability to attract and retain skilled labor, and
Hydril's ability to successfully develop new technologies and products
and maintain and increase its market share. These factors may cause
Hydril's or the industry's actual results, levels of activity,
performance or achievements to be materially different from those
expressed or implied by the forward-looking statements.