Smith International ( SII), a supplier of products and services to the oil and gas exploration and production industry, and petrochemical industry, said its second-quarter earnings rose 74.5% from the year-ago period, helped by an increase in eastern hemisphere business volumes. The company earned $118.8 million, or 59 cents a share, in the quarter, compared with $68.1 million, or 33 cents a share, a year ago. Second-quarter results include a 2 cents tax benefit related to the settlement of a U.S. tax audit. Analysts polled by Thomson First Call were expecting earnings of $108.7 million, or 54 cents a share. Second-quarter revenue rose 28.7% from a year ago to $1.74 billion. Analysts were expecting a revenue of $1.71 billion in the most recent quarter. The Houston-based company expects to earn $2.35 a share to $2.45 a share in the year 2006. Analysts were expecting earnings of $2.25 a share for the full year. Second-quarter operating income rose 58% from a year ago to $245.5 million and operating margin increased 261 basis points to 14.1%. By segment, second-quarter operating income for M-I SWACO's segment rose 28.7% from a year ago to $849.1 million, revenue from Smith Technologies increased 35.8% to $187 million, revenue from Smith Services jumped 40.6% to $241 million and revenue from Wilson segment rose 21% to $461.2 million. Shares rose $1.72 early Tuesday to $41.96.