Smith International's second-quarter revenues dropped to about $100 million, which is about 30% below its first-quarter revenues and 43% below the second quarter of last year, according to preliminary figures released this week at a Smith creditors' meeting.
However, Loren Carroll, Smith's chief financial officer, said he believes that the Newport Beach-based oil tool manufacturer sustained a smaller loss in the second quarter than in the first, when it reported a net loss of $24.8 million on revenue of $141 million. In last year's second quarter, Smith suffered a $39.8-million net loss.
Carroll declined to estimate the size of this year's second-quarter loss. However, Kevin Simpson, an oil service analyst with Drexel Burnham Lambert Inc., said he believes it will be between $15 million and $20 million. "That ain't bad, all things considered," he added, referring to the continuing fall in oil prices and drilling activity.
Simpson pointed out, however, that Smith can expect a smaller loss in its second quarter only because the first-quarter loss included a one-time loss of $11.7 million related to layoffs and plant closures.
"The (second-quarter) loss will be worse than in the first quarter on a basis excluding nonrecurring items," Simpson said.