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Schlumberger (SLB) Q4 Earnings & Revenues Beat Estimates

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Schlumberger Limited’s (SLB - Free Report) fourth-quarter 2019 earnings of 39 cents per share (excluding charges and credits) surpass the Zacks Consensus Estimate of 37 cents. The bottom line also increased from 36 cents a year ago.

The oilfield service giant recorded total revenues of $8,228 million, which beat the Zacks Consensus Estimate of $8,188 million and improved from the year-ago quarter’s $8,180 million.

The increase in Surface Systems, Drilling Systems, OneSubsea revenues in the international markets along with strong SIS digital software sales backed the company’s strong quarterly results.

Schlumberger Limited Price, Consensus and EPS Surprise

 

Schlumberger Limited Price, Consensus and EPS Surprise

Schlumberger Limited price-consensus-eps-surprise-chart | Schlumberger Limited Quote

Segmental Performance

Reservoir Characterization and Cameron segments saw a year-over-year increase in revenues, while the Drilling and Production units reported a decline.

Strong SIS digital software sales primarily aided the Reservoir Characterization segment. Moreover, the rise in Drilling Systems, OneSubsea and Surface Systems’ revenues in the international markets drove the company’s Cameron unit. This was partially offset by the decline in land activities in North America.

However, lower margins from the North America land market and Russia hurt the company’s Drilling unit. Moreover, the dip in OneStim revenues hurt the Production unit, partially offset by higher international margins.

Revenues at the Reservoir Characterization unit totaled $1,643 million, 5% higher from the year-ago period. Moreover, pre-tax operating income of $368 million was up 2% year over year.

Revenues at the Drilling unit declined 1% year over year to $2,442 million. Moreover, pre-tax operating income was $303 million, down 5% year over year.

Revenues at the Production segment declined 2% from the year-earlier quarter to $2,867 million. However, pre-tax operating income increased 27% year over year to $253 million.

Revenues at the Cameron segment amounted to $1,387 million, up 3% year over year. However, pre-tax operating income declined 4% from the prior-year quarter to $126 million.

Financials

As of Dec 31, 2019, the company had approximately $2,167 million in cash and short-term investments plus $14,770 million in long-term debt. This represented a debt-to-capitalization ratio of 38.8%.

Outlook

Schlumberger projects 2020 capital expenditure at $1.7 billion, suggesting no change from 2018 spending.

Zacks Rank & Stocks to Consider

Schlumberger currently carries a Zacks Rank #5 (Strong Sell). Some better-ranked players in the energy space are Ecopetrol SA (EC - Free Report) , California Resources Corporation (CRC - Free Report) and CNX Resources Corporation (CNX - Free Report) . While Ecopetrol sports a Zacks Rank #1 (Strong Buy), California Resources and CNX Resources carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ecopetrol is expected to witness earnings growth of 7% in 2019.

California Resources’ earnings beat the Zacks Consensus Estimate in three of the past four quarters.

CNX Resources’ earnings surpassed the Zacks Consensus Estimate in two of the prior four quarters. It has a positive earnings surprise of 34.8%, on average, for the trailing four quarters.

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