Schlumberger Limited. (SLB): A Hard Habit to Break

Friday saw a kickoff in quarterly reporting from the oilfield services group, as both Schlumberger Limited. (NYSE:SLB) and Baker Hughes Incorporated (NYSE:BHI) topped analysts’ estimates in the process of chalking up relatively solid quarters.

Schlumberger Limited. (NYSE:SLB)’s results were especially sound, with its adjusted earnings coming in at $1.01, two pennies higher than the analysts’ consensus. Its income from continuing operations were up 4% to $1.35 billion, while its revenues grew nearly 8% to $10.7 billion, compared with $9.9 billion a year ago. International revenues climbed by 13% year on year, while contributions from North America slipped by approximately 4%. Among the one-time items during the quarter was a total of $0.07 in charges related to currency devaluations in Venezuela.

Sequential slippage
Sequentially, Schlumberger’s results sagged somewhat, on the basis of the round of multiclient and software sales that typically pump up the fourth quarter of each year. in addition, the company experienced seasonal slowdowns in the North Sea, Russia, and China. It was further affected by weather delays in markets in and around the South China Sea.

On a segment basis, Schlumberger Limited. (NYSE:SLB)’s Reservoir Characterization Group saw its revenue rise by 9% to $2.8 billion. The drilling group’s revenues of $4.1 billion were also 9% higher year over year, while the $3.6 billion generated by the production group represented a 7% increase year over year.

Specific international projects
Schlumberger Limited. (NYSE:SLB) is unusually adept at detailing specific tasks performed for its individual customers, thereby providing customers with a more accurate picture of the company’s full role in the worldwide quest for oil and gas:

Offshore Angola, its WesternGeco (seismic) unit completed a major monitor survey over four fields operated by France’s TOTAL S.A. (ADR) (NYSE:TOT). During just the past year, the already productive African country has become especially hot with the discovery of pre-salt characteristics similar to those that are propelling Brazil’s Santos Basin activity. On that basis, seismic surveys to determine the full extent of the appropriate formations become especially important.

Schlumberger Limited. (NYSE:SLB), also through Western Geco, has been awarded sizable data processing and imaging contracts by BP plc (ADR) (NYSE:BP) in the South Columbus basin of Trinidad and Tobago.

In Australia, the company’s magnetic resonance service was significant to fluid identification in Apache Corporation (NYSE:APA)‘s Stag field.

In China, Schlumberger Limited. (NYSE:SLB)’s first use of its PowerDrive Archer rotary steerable system broke two field records while drilling for PetroChina Company Limited (ADR) (NYSE:PTR).

Looking at North America, which CEO Paal Kibsgaard called “the main concern” during his company’s post-release call, based on “downward trends in drilling, wireline, and coiled tubing,” which continued from the December quarter into the most recent period. In this context, North America should be distinguished from the Gulf of Mexico, where activity was strong.