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Core Labs (CLB) Q2 Earnings Meet Estimates, Sales Narrowly Beat

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Core Laboratories (CLB - Free Report) reported second-quarter 2022 results, wherein adjusted earnings of 12 cents a share met the Zacks Consensus Estimate. This is attributable to the reported quarter’s revenues being in line with the Zacks Consensus Estimate, marginally beating the same.  However, the bottom line worsened from the year-ago quarter’s earnings of 18 cents per share. This downside is attributable to the year-over-year increase in expenses.

This oilfield service provider’s adjusted revenues of $120.9 million beat the Zacks Consensus Estimate of $120 million by just 0.75%. The top line also rose from the year-ago quarter’s revenues of $118.7 million.

Segmental Performance

Reservoir Description: Revenues decreased by about 3.1% to $75.8 million from $78.2 million in the second quarter of 2021 and also missed the Zacks Consensus Estimate of $79 million. Moreover, the operating income fell from $7.2 million in the year-ago period to $5.9 million and also missed the Zacks Consensus Estimate of $7.26 million due to the heavy impact of the Russia-Ukraine conflict and associated sanctions that slowed the demand for liquid hydrocarbon assay work in Ukraine, Russia and across parts of Europe. The segment’s operating margin of 7.8% was lower than the prior-year quarter’s 9.3%.

Production Enhancement:  Revenues of $45 million compared favorably with $40.5 million in the second quarter a year earlier, which is an 11.3% increase year over year. The same beat the Zacks Consensus Estimate of $42.29 million.

Moreover, the segmental operating income of $4.9 million in the quarter outperformed the Zacks Consensus Estimate of an operating profit of $3.8 million. The year-ago period reported an operating income of $3.83 million. The strong numbers could be attributed to CLB’s strengths in both energetic systems and completion diagnostics, which helped clients optimize their well completions in the reported quarter.

Core Laboratories N.V. Price, Consensus and EPS Surprise

Core Laboratories N.V. Price, Consensus and EPS Surprise

Core Laboratories N.V. price-consensus-eps-surprise-chart | Core Laboratories N.V. Quote

Financials and Dividend

As of Jun 30, 2022, Core Labs had cash and cash equivalents worth $16.1 million and long-term debt of $186.9 million. The company’s debt-to-capitalization was 51.4%.

CLB generated $600,000 of operating cash in the reported quarter and its capital expenditure totaled $3.2 million.

Core Labs’ board of directors approved a regular quarterly dividend of a cent per share on the company's common stock, payable on Aug 29, 2022, to all shareholders of record as of Aug 8, 2022.

2022 Outlook

For the third quarter of 2022, Core Labs’ revenues are anticipated in the $123-$129 million range, while the operating income is estimated in the $10.1-$13.3 million band.

Earnings per share (EPS) for the third quarter of 2022 are expected between 13 cents and 18 cents.

As Core Labs’ prospects are directly associated with expanding its client activity and tapping new geographies, it continues to focus on the ongoing development of the new client-driven technologies and geographical exploration along with a deepened concentration on digitization and automation throughout its business.

Zacks Rank & Key Picks

Core Labs currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks from the energy space that warrant a look include HF Sinclair (DINO - Free Report) , PBF Energy (PBF - Free Report) and Vermilion Energy (VET - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for HF Sinclair’s 2022 earnings has been revised about 56.5% upward over the past 60 days from $7.64 per share to $11.96.

The Zacks Consensus Estimate for DINO’s 2022 earnings is pegged at $11.96 per share, up 686.4% from the year-ago earnings of $1.52.

The Zacks Consensus Estimate for PBF Energy’s 2022 earnings is pegged at $12.73 per share, up about 609.2% from the year-ago loss of $2.50.

PBF beat the Zacks Consensus Estimate for earnings in all the trailing four quarters, the average being around 78%.

The Zacks Consensus Estimate for Vermilion’s 2022 earnings stands at $7.37 per share, which is an increase of approximately 192.5% from the year-ago earnings of $2.52.

The Zacks Consensus Estimate for VET’s 2022 EPS has been revised from $7.08 to $7.37, up about 4%, in the past 60 days.