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Core Laboratories (CLB) Q3 Earnings & Revenues Top Estimates
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Core Laboratories N.V. (CLB - Free Report) recently reported third-quarter 2018 adjusted earnings of 64 cents per share, beating the Zacks Consensus Estimate of 63 cents. This also compares favorably with the prior-year figure of 48 cents. The results were driven by improved performance of the Production Enhancement segment.
Total revenues of $182.1 million outpaced the Zacks Consensus Estimate of $178 million. Moreover, revenues were up 11.8% from the prior-year level of $162.9 million.
Core Laboratories N.V. Price, Consensus and EPS Surprise
Reservoir Description: This segment’s revenues were $103.6 million compared with $101.4 million in third-quarter 2017. Of the total revenues from the segment, more than 80% comes from the international market. Reservoir fluids’ analysis of the company aided the segment’s performance, accounting for 60% of total segmental revenues. However, delayed recovery of international market’s activities has impacted this segment’s results in the quarter.
Operating income of the segment was about $15 million in the quarter compared with $14.6 million in the prior-year quarter. Operating margin of the segment was 15%.
Production Enhancement: Segment revenues were approximately $78.5 million in the quarter compared with $61.4 million in third-quarter 2017. Increased demand for the company’s advanced technology solutions helped in generating higher revenues.
Segment operating income was about $19.2 million in the quarter compared with $12.2 million in the prior-year quarter, reflecting a surge of 58.2%. Operating margin of the segment was 26%. Higher customer demand for the company’s technological solutions, which use enhanced completion techniques, drove the margin in the segment.
Balance Sheet
As of Sep 30, 2018, Core Laboratories had cash and cash equivalents of around $14.1 million and long-term debt (including lease obligations) of approximately $295.7 million. The debt-to-capitalization ratio of the company was 64.7%.
Cash Flow
Core Laboratoriesgenerated $23.8 million operating cash in the quarter, while capital expenditure was $4.1 million. It led to generation of $19.7 million in free cash flow. Apart from paying regular quarterly dividends, the cash will be directed toward share buybacks.
Dividend
The board of directors declared a quarterly cash dividend of 55 cents per share, payable on Nov 20, 2018 to its shareholders of record as of Oct 19, 2018.
Guidance
The company has reiterated its guidance from 8-K release. Although demand for oil is expected to surge in the next two years, the company expects international exploration and production activities to remain flat. The number of drilled-but-uncompleted wells is estimated to rise in the coming quarters.
The company expects fourth-quarter revenues in the $173-$176 million range. Operating income is anticipated in the range of $28-$31 million, with 17% operating margin. It foresees fourth-quarter earnings per share in the range of 48-54 cents.
Acquisition
In the quarter, the company completed acquisition of Pyle, Wales-based Guardian Global Technologies Ltd., which is expected to enhance its Production Enhancement technologies’ portfolio. The technologies acquired from Guardian are complementary in nature with Core Laboratories’ existing technologies, which are being offered to the clients. Moreover, the combined technologies are expected to enhance Core Laboratories’ presence in the market and provide disruptive product solutions in the next year.
Zacks Rank & Key Picks
Currently, Amsterdam-based oil field service provider Core Laboratorieshas a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks given below:
Brazilian state-run Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) has a Zacks Rank #2. The company’s earnings for 2018 are expected to surge more than 100% from the 2017 level.
Woodlands, TX-based Anadarko Petroleum Corporation holds a Zacks Rank #2. The company’s earnings for 2018 are expected to surge more than 250% year over year.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
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Core Laboratories (CLB) Q3 Earnings & Revenues Top Estimates
Core Laboratories N.V. (CLB - Free Report) recently reported third-quarter 2018 adjusted earnings of 64 cents per share, beating the Zacks Consensus Estimate of 63 cents. This also compares favorably with the prior-year figure of 48 cents. The results were driven by improved performance of the Production Enhancement segment.
Total revenues of $182.1 million outpaced the Zacks Consensus Estimate of $178 million. Moreover, revenues were up 11.8% from the prior-year level of $162.9 million.
Core Laboratories N.V. Price, Consensus and EPS Surprise
Core Laboratories N.V. Price, Consensus and EPS Surprise | Core Laboratories N.V. Quote
Segment Performance
Reservoir Description: This segment’s revenues were $103.6 million compared with $101.4 million in third-quarter 2017. Of the total revenues from the segment, more than 80% comes from the international market. Reservoir fluids’ analysis of the company aided the segment’s performance, accounting for 60% of total segmental revenues. However, delayed recovery of international market’s activities has impacted this segment’s results in the quarter.
Operating income of the segment was about $15 million in the quarter compared with $14.6 million in the prior-year quarter. Operating margin of the segment was 15%.
Production Enhancement: Segment revenues were approximately $78.5 million in the quarter compared with $61.4 million in third-quarter 2017. Increased demand for the company’s advanced technology solutions helped in generating higher revenues.
Segment operating income was about $19.2 million in the quarter compared with $12.2 million in the prior-year quarter, reflecting a surge of 58.2%. Operating margin of the segment was 26%. Higher customer demand for the company’s technological solutions, which use enhanced completion techniques, drove the margin in the segment.
Balance Sheet
As of Sep 30, 2018, Core Laboratories had cash and cash equivalents of around $14.1 million and long-term debt (including lease obligations) of approximately $295.7 million. The debt-to-capitalization ratio of the company was 64.7%.
Cash Flow
Core Laboratoriesgenerated $23.8 million operating cash in the quarter, while capital expenditure was $4.1 million. It led to generation of $19.7 million in free cash flow. Apart from paying regular quarterly dividends, the cash will be directed toward share buybacks.
Dividend
The board of directors declared a quarterly cash dividend of 55 cents per share, payable on Nov 20, 2018 to its shareholders of record as of Oct 19, 2018.
Guidance
The company has reiterated its guidance from 8-K release. Although demand for oil is expected to surge in the next two years, the company expects international exploration and production activities to remain flat. The number of drilled-but-uncompleted wells is estimated to rise in the coming quarters.
The company expects fourth-quarter revenues in the $173-$176 million range. Operating income is anticipated in the range of $28-$31 million, with 17% operating margin. It foresees fourth-quarter earnings per share in the range of 48-54 cents.
Acquisition
In the quarter, the company completed acquisition of Pyle, Wales-based Guardian Global Technologies Ltd., which is expected to enhance its Production Enhancement technologies’ portfolio. The technologies acquired from Guardian are complementary in nature with Core Laboratories’ existing technologies, which are being offered to the clients. Moreover, the combined technologies are expected to enhance Core Laboratories’ presence in the market and provide disruptive product solutions in the next year.
Zacks Rank & Key Picks
Currently, Amsterdam-based oil field service provider Core Laboratorieshas a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks given below:
El Dorado, AR-based Murphy Oil Corporation (MUR - Free Report) carries a Zacks Rank #2 (Buy). The company’s sales for 2018 are expected to grow more than 20% from 2017. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Brazilian state-run Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) has a Zacks Rank #2. The company’s earnings for 2018 are expected to surge more than 100% from the 2017 level.
Woodlands, TX-based Anadarko Petroleum Corporation holds a Zacks Rank #2. The company’s earnings for 2018 are expected to surge more than 250% year over year.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>