Schlumberger little changed after Q4 beat; says oil market now in balance

|About: Schlumberger Limited (SLB)|By:, SA News Editor

Schlumberger (NYSE:SLB) -0.3% premarket after reporting better than expected Q4 earnings and a 15% Y/Y rise in revenue, including a 59% boost in North America revenue to $2.81B which was partially offset by a 4% drop in Middle East & Asia revenue to $2.4B.

The company's unadjusted Q4 loss widened to $2.26B, or $1.63/share, from a loss of $204M, or $0.15/share, in the year-ago quarter.

Q4 pretax operating margin grew 73 bps sequentially to 14.1%, driven by improved profitability in the production, drilling and reservoir characterization businesses.

SLB says it plans to exit the marine and land seismic acquisition market, and instead turn the WesternGeco product line into an asset-light business.

SLB sees the oil market "now in balance and the previous oversupply discount is gradually being replaced by a market tightness premium, which makes us increasingly positive on the global outlook for our business."

The company says "positive oil market sentiments are reflected in third-party E&P spend surveys, which predict 15-20% growth in North American investments in 2018, while the international market is expected to grow for the first time in four years, with a projected 5% increase in spend."

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