Schlumberger Limited today reported first-quarter 2014 revenue from continuing operations of $11.24 billion versus $11.91 billion in the fourth quarter of 2013, and $10.57 billion in the first quarter of 2013.
Income from continuing operations attributable to Schlumberger, excluding charges and credits, was $1.59 billion—a decrease of 11% sequentially but an increase of 23% year-on-year. Diluted earnings-per-share from continuing operations, excluding charges and credits, was $1.21 versus $1.35 in the previous quarter, and $0.97 in the first quarter of 2013.
Schlumberger recorded charges of $0.09 per share in the fourth quarter of 2013 and of $0.07 per share in the first quarter of 2013. Schlumberger did not record any charges or credits in the first quarter of 2014.
Oilfield Services revenue of $11.24 billion decreased 6% sequentially, but increased 6% year-on-year. Oilfield Services pretax operating income of $2.37 billion decreased 9% sequentially, but increased 21% year-on-year.
Schlumberger CEO Paal Kibsgaard commented, “Growing new technology sales and expanding integration activity drove our first-quarter results despite the severe winter weather that impacted operations in Russia, China and North America. While the sequential results displayed the usual drop in product, software and multiclient license sales following strong year-end figures, our solid year-on-year growth rates were led by the Middle East & Asia and North America Areas although all geographies benefitted from an increasing focus on operational excellence and efficiency.
Internationally, performance was led by further growth in key markets in Saudi Arabia, the United Arab Emirates and the deepwaters of Australia, as well as by strength in sub-Saharan Africa, project work in Ecuador and shale-related activity in Argentina. Land activity in North America was robust on the back of increased service intensity, market share gains and new technology uptake, in spite of winter weather headwinds and pressure pumping competitive pricing. North America offshore declined slightly on operational delays and extended workover activities.
In terms of pricing, we saw little change in general trends, but new technology at premium pricing continued to penetrate the market and contributed to operating margin results, particularly when combined with the best-in-class service quality. Our overall performance in this area was further supported by our engineering, manufacturing and sustaining organization that continues to deliver new and innovative products to our field operations, with strong ‘out-of-box’ performance.
The fundamentals of the global economic recovery remain intact in spite of the unusually harsh winter weather in parts of the Northern Hemisphere, some signs of a slowdown in growth in China, and the unsettled situation in Ukraine. These factors, however, are likely temporary in nature and the oil markets continue to be tighter than once anticipated, driven by strong demand trends, lower spare capacity figures and a fall in OECD stocks. Supply continues to grow in North America, while other areas are struggling to meet their production targets. In the US, natural gas trends were boosted by winter temperatures, but supply and demand is expected to normalize over the coming months.
As a result, we continue to believe that our customers’ well-related spend will increase north of 6% in 2014, and that the spend growth rates will be relatively evenly split between the international and North American markets, driven by the independent and national oil companies. We therefore remain positive on the year to come, with our broad geographical footprint, balanced technology portfolio and agile organization providing both protection from potential market disturbances, and the ability to capitalize on market opportunities.”