Oilfield Firm SLB's Profit Rises on International Drilling Demand

Top oilfield services firm SLB reported a 14% rise in first-quarter profit on Friday, as strong international oil and gas drilling demand helped offset a slowdown in North America activity.

Companies such as SLB have gained from a rise in demand in international and offshore exploration and production, especially in the Middle East and Asia, as oil and gas producers look to secure new inventories.

International rig count, an indicator of future production, stood at 965 on average at the end of the first quarter, 5.4% higher than the previous year, according to Baker Hughes data.

Revenue from SLB’s international segment rose by 18% to $7.06 billion, compared with $5.99 billion in the year-ago quarter.

“The oil and gas industry continues to benefit from strong market fundamentals driven by a growing demand outlook. This is resulting in a significant baseload of activity, particularly in the international and offshore markets, closely aligned with the strengths of our business,” SLB CEO Olivier Le Peuch said in a statement.

Strength in international markets helped SLB offset weakness in the North America segment, where its revenue declined 6% to $1.6 billion, falling short of analysts’ estimates of $1.65 billion, according to LSEG data.

Sequentially, revenue declined 3% both in North America and in international markets due to seasonality. However, this impact was less pronounced than in prior years as robust activity gains partially offset seasonal effects, SLB said.

Shares of SLB, known earlier as Schlumberger, were down 1% in premarket trading.

The Houston, Texas-based company reported earnings of $1.07 billion, or 74 cents per share, for the quarter ended March 31, compared with $934 million, or 65 cents per share, last year.

April 19, 2024