Schlumberger Expects North America Revenues To Fall In Q4
Zacks Investment Research | Dec 04, 2018 10:01PM ET
The executive vice president of Schlumberger Limited (NYSE:SLB) , Wells Patrick Schorn recently said in a conference that the company’s total fourth-quarter revenues from the North America can be impacted by a 15% sequential fall, owing to declining hydraulic fracturing pricing. The region is currently witnessing more-than-expected reduction in hydraulic fracturing activities. Notably, in the third-quarter earnings call, the company projected its earnings per share to decline sequentially, due to the above negatives. Affected by the weakness in prices, producers in the North America are pulling back from fracking and well completions.
What’s Ahead?
Schlumberger, one of the largest oilfield services companies of the world, generated $3.2 billion revenues from the North America (accounting for 37.5% of the total revenues) in the third quarter of 2018. This reflected a 2% increase from the year-ago figure. However, the company now expects fourth-quarter 2018 revenues from the region at around $2.7 billion, representing a 3.6% fall from the year-ago quarter. First-quarter 2019 revenues will also bear the brunt of low hydraulic fracturing activities. However, Schlumberger expects the region to undergo a gradual recovery till the first half of 2019.
Schlumberger expects its international revenues, excluding the effects of Cameron businesses, to be in line with estimates. However, a few Latin American countries can reflect signs of weakness.
Stock Price Movement
The investors were not thrilled with the above news, as the stock fell 3.7% in the last session. Notably, in the past six months, the stock has declined 36% compared with the 28.4% collective fall of the Zacks Investment Research
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