Varco’s 4th-Quarter Profit to Be Less Than Estimated
Varco International Inc., citing shrunken profit margins and unexpectedly high costs in one of its major divisions, said Monday that its fourth-quarter profit will be “well below” industry analysts’ earlier estimates.
Varco, which makes oil-drilling tools, said the profit for the final period will be about $2 million to $2.5 million, or 7 to 8 cents per share. Wall Street analysts had expected the company to post fourth-quarter earnings of about $5 million, or 16 cents a share.
Varco made the announcement after the market closed Monday. Its stock price dropped 25 cents per share to close at $10.75 in moderate trading on the New York Stock Exchange.
The company said that despite the low profit, revenue should be about $71.5 million for the three months and that new orders could hit $85 million--the highest quarterly total in Varco’s history.
Varco earned 11 cents a share in the final quarter of 1994 on revenue of $60 million.
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