Schlumberger (SLB) was down in Thursday afternoon trading after a mixed first quarter.
The oilfield giant said first quarter earnings were $1.59 billion, or $1.21 a share, up from 94 cents in the year-ago period and one penny ahead of estimates. Revenue rose 6.3% to $11.24 billion, just below the $11.49 billion analysts were expecting.
The Middle East and Asia a was the strongest region, with sales up 19%, followed by North America, with 12%. Revenue edged ahead by 0.6% in Europe and Africa, while Latin America saw a 7.7% decline.
Stephens analyst Michael Marino reiterated an Overweight rating on the stock: "While SLB’s geographically diversified footprint will likely limit exposure to the accelerating margin trends in North America this year, global oilfield spending continues to grow at a modest pace. Overall, we continue to see slow and steady revenue growth for the Company and solid incremental margins on higher deepwater mix, overall efficiency gains and potential pricing gains in North America."
FBR Capital Markets' Thomas Curran and Juan Avendano reiterated their Outperform rating on the stock, noting the company's share repurchases and reiteration of gudiance:
Reveals several awards, confirming it claimed lion’s share of Pemex’s Mega-Tenders. In (1) Mexico, SLB officially announced that it won the largest combined award in Pemex’s recent Mega-Tender round: three multi-year IPM contracts worth, in aggregate, over $1.9B in revenues or nearly 50% of the spoils; (2) Norway, the Company inked a 5-year (plus two option periods of one year) IPM contract, of undisclosed value, with Det norske oljeselkap ASA for exploration drilling and development of the Ivar Aasen field in northern North Sea; (3) Australia, SLB completions signed a $40M contract with INPEX covering the upper and intermediate completions for its first 20 wells at the offshore Ichthys field; and (4) Brazil, SLB artificial lift won a 5-year, $50M award from Petrobras for the provision, installation, and monitoring of ESPs on 6 wells at the offshore Parque Das Baleais field.
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Global customer spending (i.e. upstream capex) expectations unchanged. As a reminder, SLB lays out the macro view from the masthead for the rest of the sector. CEO Paal Kibsgaard remarked “we continue to believe that…well-related spend will increase north of 6% in 2014, and that spend growth rates will be relatively evenly split between the international and North American markets, driven by the independent and national oil companies”.
Fellow oilfield services company Baker Hughes (BHI) also reported today.
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