Investopedia: Schlumberger Sets A Fast Pace

The world's largest energy services and equipment company Schlumberger (NYSE:SLB) has started the calendar fourth quarter earnings reporting cycle by setting a tough pace. Not only did the company report very strong revenue growth relative to expectations, but profitability was solid and guidance was rather encouraging. 

The Quarter That Was 

On a reported basis, the fourth quarter was clearly a period of strong demand for Schlumberger's services. Revenue rose 32% sequentially and 58% annually and topped $9 billion. Even stripping out the acquisition of Smith, the year-on-year growth was about 15%. Profitability was likewise strong, with EBITDA growing 28% sequentially and 47% annually. Once again, even without the inclusion of Smith, the year-on-year growth in EBITDA and operating income would have been quite strong.

North America was clearly an area of strength for the company, as revenue jumped 27% sequentially - including a 24% increasing land revenue on top of 4% growth in rig counts. Operating income was likewise very strong (up 76% sequentially), even as the federal government's ban on Gulf of Mexico activity impacted earnings.

Around the rest of the world results were less scintillating. Revenue was up a bit in the Eastern Hemisphere category, while declining a bit in Latin America due largely to the Mexican market. (For more, see Oil Services Sector Powered By North America.)

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