Schlumberger Announces Second-Quarter 2017 Results
Schlumberger Limited (NYSE: SLB), with principal offices in Paris, Houston, London and The Hague, is the world's leading provider of technology for reservoir characterization, drilling, production, and processing to the oil and gas industry. It operates in 85 countries and employs approximately 100,000. Schlumberger reported results for the second quarter of 2017 as follows:
Total corporate revenue: UP 8% from the previous quarter to $7,462 billion and UP 4% from the same period a year ago.
- North America revenue: UP by 18% from the previous quarter to $2,202 billion and UP 27% from the same period a year ago.
- International revenue: UP by 4% from the previous quarter to $5.136 billion but DOWN 4% from the same period a year ago.
Pretax operating income: UP 25% from the previous quarter to $950 billion and UP 27% from the same period a year ago.
Pretax operating margin: UP to 12.7% compared to 11.0% the previous quarter and 10.4% during the same period a year ago.
Net income: a LOSS of $74 million compared to a PROFIT of $279 million in the previous quarter and a LOSS of $2,160 billion during the same period a year ago.
Net income, excluding charges & credits: UP 41% from the previous quarter to $488 million and UP 54% from the same period a year ago.(Management believes that the exclusion of one time only charges & credits enables it to evaluate more effectively Schlumberger’s operations period over period and to identify operating trends that could otherwise be masked by the excluded items. These measures are also used by management as performance measures in determining certain incentive compensation.)
Diluted Earning per Share: a LOSS of $0.05/share compared to a PROFIT of $0.20/share in the previous quarter and a LOSS of $1.56/share in the same period a year ago.
Diluted Earning per Share excluding charges & credits: were UP 40% from the previous quarter to $0.35/share and UP 52% from the same period a year ago.
Schlumberger Chairman and CEO, Paal Kibsgaard, commented on the above, in part, saying:
“While the activity outlook in North America for the second half of the year remains robust, we are now also seeing more positive signs in the international markets with increases in activity and new project plans starting to emerge in several GeoMarkets.
...we continue to focus on serving our customers and driving our business forward and, as part of this focus, we announced a new agreement yesterday to acquire a majority equity interest in the Eurasia Drilling Company (EDC). This extends the successful long-term relationship that we have enjoyed with EDC through the strategic alliance that we signed in 2011. Closing of the transaction is
subject to approval by the Federal Antimonopoly Service of Russia.
We also remain on track to close the OneStim^SM joint venture transaction in the second half of this year, which will allow us to further capitalize on the recovery in North America land unconventional activity.At the same time, our increasing investments in Schlumberger Production Management through the new projects with OneLNG, YPF, and NNPC and FIRST E&P are not only providing additional short-term opportunities for our various product lines, but also a
long-term activity baseline with superior full-cycle financial returns for the company as a whole.Based on the above, we continue to be optimistic about the future of Schlumberger, as we maintain an attentive watch and flexible approach to the shape and pace of the emerging oil market recovery.”
Share Repurchase Activity During the Quarter
Schlumberger repurchased 5.5 million shares of its common stock at an average price of $72.34 per share for a total purchase price of $398 million.
New Joint Ventures Entered During the Quarter
- On May 31, 2017, Schlumberger and Production Plus created a joint venture to develop HEAL System™ technology and business. HEAL System technology is designed to lower production costs by mitigating production challenges commonly found in horizontal wells in unconventional resource plays.
- On June 29, 2017, Schlumberger, the Nigerian National Petroleum Corporation (NNPC) and FIRST E&P signed an agreement for development of the Anyala and Madu fields in offshore Nigeria. Under the agreement, Schlumberger will contribute the required services in kind and capital for the project development until first oil.
Dividend Announcement
- On July 19, 2017, the Company’s Board of Directors approved a quarterly cash dividend of $0.50 per share of outstanding common stock, payable on October 13, 2017 to stockholders of record on September 6, 2017.