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Schlumberger earnings in-line, revenue beats expectations

Published 04/19/2024, 07:05 AM
Updated 04/19/2024, 07:07 AM
© Reuters.  Schlumberger (SLB) earnings in-line, revenue beats expectations

Schlumberger (NYSE:SLB), a leading oilfield services company, reported first-quarter earnings per share (EPS) of $0.75, meeting analysts' estimates, according to a recent press release. The company's revenue reached $8.71 billion, slightly above the consensus estimate of $8.7 billion, marking a 13% increase from the same quarter last year.

Despite the in-line earnings, SLB shares saw a modest decline of 1.2% following the announcement.

CEO Olivier Le Peuch highlighted the company's robust year-on-year growth, with a notable 19% increase in adjusted EPS and a 15% rise in adjusted EBITDA. Le Peuch attributed approximately half of the revenue growth to the Aker subsea business, part of the OneSubsea joint venture, and emphasized the company's strong international market performance, particularly in the Middle East & Asia and Europe & Africa regions.

Despite a softer North American market, international revenue grew by 18% year on year, with the Middle East & Asia region experiencing a significant 29% increase. The company's core businesses—Reservoir Performance, Well Construction, and Production Systems—also saw substantial growth, with Production Systems revenue up 28% year on year, driven by the Aker subsea business acquisition.

Looking ahead, Schlumberger remains confident in its global revenue growth outlook for 2024, expecting a seasonal rebound in activity in the Northern Hemisphere and continued robust international activity. The company reaffirmed its guidance of mid-teens EBITDA growth for the full year and announced ambitious plans to return $7 billion to shareholders over the next two years, with a target of $3 billion in 2024 and $4 billion in 2025.

Le Peuch expressed optimism for the future, citing strong market fundamentals in the oil and gas industry and the company's strategic position to capitalize on the growing emphasis on emissions reduction and lower-carbon technologies. He also mentioned the planned acquisition of ChampionX Corporation, which is expected to enhance Schlumberger's production and recovery portfolio.

During the quarter, Schlumberger repurchased 5.4 million shares of its common stock. Despite the slight stock dip post-earnings, Schlumberger's stable performance and strategic initiatives signal a positive momentum for the upcoming quarters.

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