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Largest oil services provider Schlumberger (NYSE: SLB) reported better-than-expected fourth-quarter results on Friday and, like rivals Halliburton and Baker Hughes, expects levels of spending and activity is accelerating this year.
Schlumberger’s earnings per share (EPS), excluding charges and credits, increased 37% sequentially to $ 0.22, beating Refinitiv IBES estimate of $ 0.17.
Schlumberger revenue also increased 5% sequentially, driven by strong activity and strong execution in both North America and international markets. Sales in North America increased 13% in the fourth quarter compared to the third quarter.
The world’s three largest oil service providers – Schlumberger, Halliburton and Baker Hughes – all posted losses for the third quarter. However, these losses were significantly lower than those recorded in the second quarter, “the most difficult quarter in decades,” as Schlumberger CEO Olivier Le Peuch said. Losses were smaller between July and September also due to massive spending cuts after oil service companies laid off tens of thousands of workers.
For the fourth quarter, all three oil service providers reported higher revenues this week from the third quarter and expressed optimism that oil demand and drilling activity will pick up this year. Baker Hughes posted its first quarterly net profit since the oil price collapse in March, while Halliburton reported adjusted net profit, with revenue in North America increasing 26% sequentially to $ 1.2 billion of dollars.
Schlumberger expects demand for oil to return to 2019 levels no later than 2023 or earlier, Le Peuch said in the release of fourth quarter results today.
“In North America, spending and activity dynamics will continue in the first half of 2021 towards maintenance levels, although moderated by capital discipline and industry consolidation. Internationally, following the seasonal effects of the first quarter of 2021, and while OPEC + responds to the strengthening of demand for oil, higher spending is expected from the second quarter of 2021. The acceleration of l ‘activity will extend beyond short cycle markets and be broad, including offshore, as evidenced by the fourth quarter, ”said Le Peuch.
By Charles Kennedy for Oil chauffage
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