Summary
Schlumberger Limited (SLB) reported its first-quarter 2010 results, showing a notable decrease in revenue and net income compared to the same period in 2009. Revenue for the quarter stood at $5.60 billion, down from $6.00 billion in Q1 2009, while net income attributable to Schlumberger fell to $672 million from $938 million in the prior year. This decline was primarily driven by lower activity and pricing across key segments, particularly in the Europe/CIS/Africa and North America regions. Despite the year-over-year decrease, operating cash flow showed a significant improvement, increasing to $989 million from $551 million in Q1 2009, indicating better working capital management and reduced pension contributions. The company also announced significant strategic developments during the quarter, including a definitive merger agreement with Smith International, Inc. and the acquisition of Geoservices. These transactions are expected to enhance Schlumberger's offerings in engineered drilling systems and well intervention services. The report also highlighted specific charges taken in the quarter, including merger-related costs and a charge related to the new healthcare legislation impacting retiree drug benefits. Investors should note the ongoing uncertainty surrounding the global economic environment and its impact on oil and gas exploration and production spending. While the company expressed optimism for the remainder of 2010, particularly with rising oil prices potentially boosting international activity, the outlook for North American natural gas markets remains less clear. The successful integration of the announced acquisitions and the satisfaction of closing conditions for the Smith merger will be key factors for future performance.
Financial Highlights
51 data points| Revenue | $5.60B |
| Cost of Revenue | $4.34B |
| Gross Profit | $1.25B |
| R&D Expenses | $207.00M |
| Operating Income | $672.00M |
| Interest Expense | $45.00M |
| Net Income | $672.00M |
| EPS (Basic) | $0.56 |
| EPS (Diluted) | $0.56 |
| Shares Outstanding (Basic) | 1.20B |
| Shares Outstanding (Diluted) | 1.22B |
Key Highlights
- 1Revenue decreased by 6.7% year-over-year to $5.598 billion for the first quarter of 2010.
- 2Net income attributable to Schlumberger decreased by 28.3% year-over-year to $672 million.
- 3Diluted earnings per share (EPS) declined to $0.56 from $0.78 in the prior year's first quarter.
- 4Operating cash flow significantly improved, increasing to $989 million from $551 million year-over-year.
- 5The company announced a merger agreement with Smith International, Inc. and the acquisition of Geoservices during the quarter.
- 6Significant charges of $75 million (pretax) were recorded, related to merger costs and changes in tax law impacting retiree benefits.
- 7Oilfield Services revenue decreased 6% year-over-year, while WesternGeco revenue decreased 14%.