Salem Radio Network News Friday, August 19, 2022

Business

Schlumberger raises revenue forecast as oilfield services booms

By Rithika Krishna and Liz Hampton

(Reuters) – Schlumberger NV on Friday raised its annual revenue forecast after beating analysts’ second quarter earnings expectations, buoyed by higher demand for its oilfield services and equipment.

The company has benefited from a boost in activity driven by stronger oil and gas prices. Global crude prices hovered above $100 per barrel last quarter, fuelled by tight supplies following Western sanctions on major producer Russia and as energy consumption returned to near pre-pandemic levels.

“The multiyear upcycle continues to gain momentum with upstream activity and service pricing steadily increasing both internationally and in North America, resulting in a strengthened outlook for Schlumberger”, Chief Executive Officer Olivier Le Peuch said in a statement.

Schlumberger’s upbeat outlook follows a mixed quarter from the world’s largest oilfield service providers. Baker Hughes warned that the demand outlook for the next 12 to 18 months was “deteriorating” while Halliburton Co predicted “multiple years” of increased activity.

Schlumberger said it now expects a high-teens percentage rise in revenue for 2022, which would be at least $27 billion. It had previously anticipated mid-teen growth.

The rally in crude prices powered a 57% jump in the U.S. rig count and a year-on-year increase of 8.7% in the international rig count, Baker Hughes data showed.

Schlumberger’s shares rose 3.5% to $34.81 in premarket trading.

Schlumberger reported net income of $959 million, or 67 cents per share for the three months ended June 30, compared with $431 million, or 30 cents per share, a year earlier.

On a per share basis, Schlumberger reported earnings of 50 cents, compared with analysts’ average estimate of 40 cents, IBES data from Refinitiv showed.

Revenues of $6.8 billion also beat Wall Street forecasts of $6.28 billion, according to IBES data. International sales were up 12% from the previous quarter, while in North America revenue jumped 20%.

“Solid release all around, with results outpacing expectations,” analysts for investment firm Tudor, Pickering, Holt & Co wrote in a note on Friday.

(Reporting by Rithika Krishna in Bengaluru; editing by Elaine Hardcastle and Jason Neely)

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