Schlumberger (NYSE:SLB) +3% pre-market after reporting better than expected
Q4 earnings and a strong improvement in free cash flow.
SLB says Q4 revenues rose 1% Y/Y but fell 4% Q/Q to $8.23B, as international revenue rose 8% Y/Y and 2% Q/Q to $5.72B while North America revenue fell 13% Y/Y and 14% Q/Q to $2.45B "due to customer budget exhaustion and cash flow constraints."
Production revenue fell 2% Y/Y and 9% Q/Q, primarily due to weaker OneStim revenue as SLB "continued to right-size our hydraulic fracturing capacity by stacking more fleets in the face of lower demand."
Q4 pre-tax operating margin improved 40 bps from the year-ago quarter to 12.8%, even as U.S. crude prices fell from as high as $77/bbl in September 2018 to ~$63/bbl by year-end 2019.
Q4 cash flow from operations and free cash flow totaled $2.3B and $1.5B, respectively
SLB recorded $456M in various charges during the quarter from items including restructuring in North America and workforce reductions.
"We are confident we have turned the corner, particularly as we have now seen sequential international margin growth for the last three quarters as a result of our discipline and focus on execution performance," CEO Olivier Le Peuch says.