Helix Energy Earnings: Beats on Profit, Short on Revenue Estimate

Helix Energy Solutions Group Inc. (NYSE:HLX) reported net income above Wall Street’s expectations for the second quarter. Helix Energy Solutions Group is an international offshore energy company that provides reservoir development solutions and other contracting services to the energy market as well as to its own oil and gas properties.

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Helix Energy Solutions Group Inc. Earnings Cheat Sheet

Results: Net income for Helix Energy Solutions Group Inc. rose to $44.6 million (42 cents per share) vs. $41.3 million (39 cents per share) in the same quarter a year earlier. This marks a rise of 8% from the year-earlier quarter.

Revenue: Rose 2.7% to $347.4 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Helix Energy Solutions Group Inc. reported adjusted net income of 51 cents per share. By that measure, the company beat the mean estimate of 43 cents per share. It fell short of the average revenue estimate of $356.5 million.

Quoting Management: Owen Kratz, President and Chief Executive Officer of Helix, stated, “notwithstanding that both the Q4000 and the Seawell were out of service for a good portion of the second quarter due to longer than anticipated regulatory dry docks, Helix managed a fairly good second quarter, resulting in much stronger financial performance for the first half of 2012 compared to last year. Activity levels for both our Well Intervention and Robotics businesses remain strong as we continue to grow backlog. The addition of the D534 to our fleet will allow us to address the robust demand for well intervention services in the near term. In addition, we are pleased to report success on our Danny II exploratory well.”

Key Stats:

Last quarter, the company’s gross margin expanded 70.3 percentage points from the year-earlier quarter to 99.9%. It was the fifth consecutive quarter of gross-margin growth. In this period, margins have grown an average of 31.6 percentage points per quarter on a year-over-year basis.

The company has now beaten analyst estimates for three quarters in a row. It beat the mark by 29 cents in the first quarter and by 30 cents in the fourth quarter of the last fiscal year.

Revenue has now increased for three consecutive quarters. In the first quarter, revenue rose 39.9% to $407.9 million while the figure rose 29.3% in the fourth quarter of the last fiscal year from the year earlier.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the third quarter is 47 cents per share, a drop from 50 cents. The average estimate for the fiscal year is $2.05 per share, a rise from $1.75 ninety days ago.

Competitors to Watch: Global Industries, Ltd., Oceaneering International, TETRA Technologies, Inc., Halliburton Company, Technip, McDermott International, Willbros Group, Inc., Superior Energy Services, Inc., Basic Energy Services, Inc, and Subsea seven SA.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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