Oilfield services provider Schlumberger Ltd. (SLB) on Friday posted a lower profit for the fourth quarter, reflecting a downswing in the Oilfield Services and WesternGeco revenues.
The Houston, Texas-based company's fourth-quarter net income attributable to Schlumberger was $795 million or $0.65 per share, compared to $1.15 billion or $0.95 per share in the year-ago quarter.
Income from continuing operations for the latest quarter totaled $817 million or $0.67 per share. On average, 27 analysts polled by Thomson Reuters expected the company to post earnings of $0.64 per share. Analysts' estimates typically exclude special items.
Quarterly revenues dropped to $5.74 billion from the previous year's revenue of $6.87 billion, but surpassed the $5.45 billion revenue consensus estimate of seventeen Street analysts.
Oilfield Services revenue were down 17% to $5.17 billion from $6.26 billion in the prior-year quarter. Pretax segment operating income totaled $1.01 billion, a decline of 37%, compared to $1.59 billion in the same quarter of last year.
WesternGeco revenue dropped 8% to $549 million from $599 million reported a year earlier, while pretax segment operating income advanced 30% to $115 million from $88 million last year. For the full year 2009, the company reported net income attributable to Schlumberger of $3.13 billion or $2.59 per share, compared to $5.44 billion or $4.45 per share in 2008.
Income from continuing operations decreased to $3.156 billion or $2.61 per share from $5.397 billion or $4.42 per share in the previous year.
Excluding charges, income from continuing operations attributable to Schlumberger amounted to $3.36 billion or $2.78 per share, compared to $5.49 billion or $4.50 per share in fiscal 2008. Analysts expected earnings of $2.73 per share for the full year.
Annual revenue for fiscal 2009 advanced to $22.7 billion from $27.2 billion reported in the twelve months ended 2008. Twenty two Wall Street analysts had a consensus revenue estimate of $22.48 billion for fiscal 2009.
Looking ahead, the company said its outlook for 2010 remains largely dependent on the prospects for the general economy. At the end of the third quarter, Schlumberger indicated that the company is "encouraged that signs were emerging that demand for oil and gas would begin to increase. Consensus forecasts predict that oil demand in 2010 will increase, particularly in the developing world, for the first time since 2007."
Hence, the company estimates that the oil prices are likely to be sustained at current levels and that as its customers' confidence grows, their exploration and production budgets would increase. Further, the company said it feels that considerable leverage to increase investment exists in offshore markets, in Russia, as well as in certain emerging opportunities such as Iraq.
For natural gas activity, the company said it remains a great deal more cautious. Despite signs of some recovery in industrial demand and the impact of the recent cold weather, Schlumberger considers that markets remain generally oversupplied. "Increased flows of LNG—with additional capacity being added in 2010—as well as the general uncertainty over the decline rates of unconventional gas production have the potential to limit the current increase in the North American gas drilling rig count," the company said in a statement.
The company expects that 2010 would be a better year for multiclient seismic sales and for land seismic activity particularly in Middle East and North Africa. While marine activity would be reasonably robust, pricing improvements will be limited due to continued new capacity additions.
In addition, the company added, "Our technology portfolio and worldwide infrastructure mean we are strongly positioned to capture growth opportunities as our customers begin to increase their investment."
Among other players in the field, Baker Hughes Inc. (BHI) is slated to report fourth-quarter results on January 26, as analysts are projecting earnings of $0.35 per share on revenues of $2.34 billion. Another peer, Halliburton Co. (HAL) will issue forth its fourth-quarter numbers on January 25, with analysts expecting earnings of $0.27 per share on revenues of $3.62 billion.
Schlumberger shares, which have been trading between $35.05 and $72.00 in the past 52 weeks period, closed Thursday's trading session at $68.31, down 78 cents or 1.13%.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.