Schlumberger beats by $0.02, reports revs in-line
Reports Q4 (Dec) earnings of $1.35 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of $1.33; revenues rose 7.4% year/year to $11.91 bln vs the $11.98 bln consensus. Co recorded charges of $0.09 per share in the fourth quarter of 2013 versus $0.06 per share in the fourth quarter of 2012. Schlumberger did not record any charges or credits in the third quarter of 2013.
Highlights/metrics:
"The overall global economic outlook continues largely unchanged, with fundamentals continuing to improve in the U.S., and Europe seemingly set for stronger growth. These positive effects should overcome lower growth in some developing economies and support a continuing rebound in the world economy. Largely as a result, forecasts for oil demand in 2014 have been revised upwards to reach the highest demand growth in several years. Supply is expected to keep pace with demand, with the market, therefore, remaining well balanced. Natural gas prices internationally should be supported by demand in Asia and Europe. In the U.S., we see no change in fundamentals, with any meaningful recovery in dry gas drilling activity some way out in the future."
Highlights/metrics:
- Oilfield Services revenue of $11.91 bln was up 3% sequentially and increased 7% year-on-year.
- Oilfield Services pretax operating income of $2.60 bln was up 4% sequentially and increased 23% year-on-year.
- Fourth-quarter results were driven by solid activity in key international markets and strong year-end product, software and multiclient seismic sales in almost all areas. Growth was strongest internationally, where revenue set a new record high, but all Areas recorded sequential growth underpinned by the quality and efficiency of Co'sexecution.
- Overall results were, however, impacted by the temporary shutdown of activity in South Iraq and seasonal slowdowns in North America, the North Sea, Russia and China.
- Geographical results were led by the Middle East & Asia, with continuing strength in the key markets of Saudi Arabia and the United Arab Emirates as well as in exploration activity in Malaysia and Australia.
- Deepwater exploration work and strong project management activity in Argentina and Ecuador led Latin America higher, while Europe/CIS/Africa made progress through significant activity in Angola, Azerbaijan and Turkmenistan.
- In North America, deepwater activity in the Gulf of Mexico continued to be strong, while on land increased service intensity, improved efficiency, market share gains, and new technology uptake was again offset by further pricing weakness in most product lines.
"The overall global economic outlook continues largely unchanged, with fundamentals continuing to improve in the U.S., and Europe seemingly set for stronger growth. These positive effects should overcome lower growth in some developing economies and support a continuing rebound in the world economy. Largely as a result, forecasts for oil demand in 2014 have been revised upwards to reach the highest demand growth in several years. Supply is expected to keep pace with demand, with the market, therefore, remaining well balanced. Natural gas prices internationally should be supported by demand in Asia and Europe. In the U.S., we see no change in fundamentals, with any meaningful recovery in dry gas drilling activity some way out in the future."