HAL.L Share News (HAL)

By Liz Hampton

HOUSTON, March 27 (Reuters) - Shares of ProPetro HoldingCorp fell by as much as 12.9 percent on Tuesday afterthe U.S. pressure pumper reported a lower than expectedquarterly profit on weather-related delays and a higher mix oflower-margin services.

The Midland, Texas, company posted earnings per share of 12cents in the fourth quarter, below analysts' expectations of 35cents, according to Thomson Reuters I/B/E/S. Fourth-quarterrevenue of $313.7 million was roughly in line with expectationsof $311.7 million.

Pressure pumping has been a bright spot in the oilfieldservices sector, which was hit hard by a brutal three-yeardownturn in prices that began in 2014. ProPetro's operations arefocused in the Permian Basin, a shale patch in West Texas andNew Mexico where there has been strong demand for completionservices amid a surge in drilling activity.

ProPetro's results were affected by inclement weather, alarger mix of less-lucrative vertical completion jobs thanpreviously anticipated, and more time off during the holidays,the company said.

Harsh winter conditions in the northern United Statesimpacted the company's supply chain, Chief Executive Dale Redmantold analysts on a conference call. He cited rail, which is usedto haul in sand from Wisconsin and Minnesota for hydraulicfracturing. He said customers performed more vertical wellcompletions because of lease obligations.

Oilfield services competitor Halliburton Co lastmonth warned investors that its first-quarter results also wouldbe hurt by rail delays affecting frac sand deliveries.

ProPetro plans to add two new fracking fleets in the secondand third quarters of 2018, bringing its total to 20. Thecompany also plans to enhance its legacy fleet by an incremental35,000 hydraulic horsepower this year.

Although demand for fracking and other well-completionservices has climbed, more announcements of new builds havesparked concerns among investors and analysts that the marketmay become oversupplied.

"While the domestic pressure pumping sector remains undersupplied (and Permian new builds warranted), we believe thisannouncement could be viewed negatively by a market stillfearful of frac over building in NAM (North America)," JamesWest, senior managing director and partner at investment bankEvercore ISI, wrote in a note following the earnings release,referring to ProPetro's plans to add two fleets.

ProPetro shares were down 7 percent at $15.78 in latemorning, off an earlier low at $14.78.

(Reporting by Liz HamptonEditing by Matthew Lewis)