Halliburton ( HAL) said Monday that its fourth-quarter profits grew 5% from a year ago, primarily due to strong revenue growth overseas and a favorable impact from foreign tax credits.

The company earned $690 million, or 75 cents a share, compared with $658 million, or 64 cents a share, in the fourth quarter of 2006.

Analysts were expecting earnings of 69 cents a share, according to a survey by Thomson Financial.

Fourth-quarter revenue was $4.2 billion, up 19% from the same period the year before. Revenue grew 27% in the Eastern Hemisphere because of increased activity there. Sales from operations in the Western Hemisphere rose 12%, mostly owing to improved operating efficiency.

"I am very pleased with our performance in 2007," CEO Dave Lesar said in a prepared statement. "We are particularly pleased by our growth in the Eastern Hemisphere."

Halliburton's higher activity outside of North America reduced the company's overall tax rate, which also served to improve its earnings, Lesar said. However, lower drilling activity in Canada and the Rocky Mountains continued to put downward pressure on profits in the fourth quarter.

Although Halliburton successfully rolled over most of its well-completion contracts into 2008, prices in North America are expected to fall this year, Lesar said, likely restricting revenue growth. He's expecting a rebound in 2009.

Roughly 53% of Halliburton's revenues were generated outside of North America in 2007, an increase of 3 percentage points over 2006.

Completion and production income in the fourth quarter was $571 million, down $26 million, or 4%, from the fourth quarter of 2006. The decline was mostly a result of decreased C&P activity in Europe and Africa, Halliburton stated in a press release.

Drilling and evaluation revenue was $403 million in the fourth quarter, up $18 million, or 5%, from the same period a year ago. North American D&E activity fell 3% in the quarter.

During the quarter, Halliburton secured a $683 million contract with Mexican national oil company Pemex to drill and complete 58 land wells in southern Mexico. It also repurchased 2 million shares at a total cost of $67 million. CFO Mark McCollum said on a conference call that he expects stock buybacks to increase in the coming years.

Lesar said Halliburton's forward-looking strategy is to continue to grow its overseas operations while improving its operating efficiency in North America.

Halliburton's stock has fallen from a high near $42 in mid-October to a near-term low of $31.66 a share, mostly in line with a decline in commodity prices.

Shares of Halliburton were recently trading 1.8% higher at $33.71.