July 22, 2008 / 9:17 PM / in 9 years

UPDATE 1-Nabors second-quarter profit falls 15 percent

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HOUSTON, July 22 (Reuters) - Nabors Industries Ltd NBR.N, an onshore drilling contractor, said on Tuesday its second-quarter net income fell 15 percent as softness in its Canadian market and hedging losses weighed.

A boom in natural gas drilling in the United States in recent months has improved the fortunes of land-based drillers, a group of companies that had been hurt by overcapacity.

“Our second quarter saw a dramatic and rapid turnaround in activity and in the outlook for our North American businesses,” said Gene Isenberg, Nabors chairman and chief executive. “It is now clear that our operating income bottomed out in the second quarter and the outlook for the second half and beyond is improving more rapidly than we had anticipated.”

Profit for the Hamilton, Bermuda, company was $194 million, or 67 cents per diluted share, compared with $228 million, or 79 cents per diluted share in the same period a year earlier.

Analysts had expected Nabors to report a second-quarter profit of 69 cents per share, according to Reuters Estimates.

Second-quarter net income was reduced by about 6 cents per diluted share by a tax adjustment, an increase in diluted shares, and hedging losses, Nabors said.

Total revenue rose to $1.3 billion from $1.1 billion. (Reporting by Anna Driver, editing by Phil Berlowitz)

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