01—Abstract
Summary
Summary of the 10-K filed February 13, 2008. Cited figures are marked; the original filing is the authoritative source.
SLB LIMITED/NV (SLB) filed its 2007 Annual Report on February 13, 2008, detailing a strong year of growth and performance.
The company, a global leader in oilfield services, reported a 21% increase in total revenue to $23.28 billiona, driven primarily by robust international demand in its Oilfield Services segment. Profitability also saw significant improvement, with pretax segment income rising 31% year-over-year. WesternGeco, the company's seismic solutions division, also experienced substantial growth, with revenue up 20% and a strong backlog.
The report highlights SLB's strategic focus on technological innovation and international expansion. The company's diversified service offerings, spanning the entire reservoir life cycle, continue to be a key differentiator. Despite varying global economic conditions and commodity price fluctuations, SLB demonstrated resilience and adaptability, particularly in regions like the Middle East & Asia, Europe/CIS/Africa, and Latin America, which showed strong year-on-year revenue growth.
North America, while facing a different market dynamic driven by natural gas, remained a stable contributor. Management expressed confidence in the company's ability to navigate future challenges and capitalize on opportunities in an evolving energy landscape.
02—Key points
Key Highlights
- Total revenue for 2007 increased by 21% to $23.28 billion, reflecting strong global demand for oilfield services.
- The Oilfield Services segment saw significant revenue growth of 21%, with particularly strong performance in the Middle East & Asia (31%), Europe/CIS/Africa (30%), and Latin America (29%) regions.
- WesternGeco, the seismic services segment, also experienced robust growth with a 20% increase in revenue and a backlog of $1.2 billion at year-end.
- Pretax segment income grew by 31% year-over-year, demonstrating improved profitability and operational efficiency.
- The company continued its focus on technological innovation, with new product introductions and strategic acquisitions to enhance its service offerings.
- SLB maintained a strong financial position with healthy cash flow from operations and a sufficient liquidity buffer.
- Dividends declared per share increased, reflecting the company's commitment to returning value to shareholders.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2007, SLB kept $0.22.
- Revenue$23.28B100.0%
- Cost of revenue−$15.48B66.5%
- Gross profit$7.80B33.5%
- Operating costs−$2.62B11.3%
- Operating income$5.18B22.2%
- Interest, other & tax$-00.0%
- Net income$5.18B22.2%
Where FY2007 revenue went
$23.28B- Cost of revenue: $15.48B, 67% of revenue
- Net income: $5.18B, 22% of revenue
- R&D: $728.0M, 3.1% of revenue
- Other operating costs: $1.89B, 8.1% of revenue
Kept 22% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2007filed February 13, 2008Financial Statements
| Revenue | $23.28B |
| Cost of Revenue | $15.48B |
| Gross Profit | $7.80B |
| R&D Expenses | $728.00M |
| Operating Income | $5.18B |
| Interest Expense | $275.00M |
| Net Income | $5.18B |
| EPS (Basic) | $4.36 |
| EPS (Diluted) | $4.20 |
| Shares Outstanding (Basic) | 1.19B |
| Shares Outstanding (Diluted) | 1.24B |
05—Questions
Frequently Asked Questions
How did SLB's revenue perform in 2007 compared to 2006?
SLB's total revenue in 2007 increased by 21% to $23.28 billion, up from $19.23 billion in 2006. This growth was primarily driven by strong performance in its international operations, particularly in the Middle East & Asia, Europe/CIS/Africa, and Latin America regions.
What were the key drivers of revenue growth for SLB in 2007?
The primary drivers of revenue growth were strong demand for oilfield services globally, driven by increased customer expenditures on exploration and production. Technological innovation, expansion of service offerings, and strategic acquisitions also contributed to the growth. WesternGeco's seismic services also saw increased demand.
How is the company's performance segmented?
SLB operates two main business segments: Oilfield Services (OFS) and WesternGeco. Oilfield Services is further broken down into four geographic areas: North America, Latin America, Europe/CIS/Africa, and Middle East & Asia. WesternGeco provides reservoir imaging, monitoring, and development services.
What is the outlook for 2008 based on this filing?
The report indicates a more complex outlook for 2008. While land activity outside North America is expected to remain strong and seismic exploration services will be in high demand, North American natural gas drilling may not see significant changes without severe weather. Overall growth could be restricted by high offshore rig utilization and limited new rig availability. Maintaining production from aging reservoirs and increased exploration in remote/complex geological areas will continue to be challenges.
06—Continue