SLB announces first-quarter 2024 results

  • Revenue of $8.71 billion increased 13% year on year
  • GAAP EPS of $0.74 increased 14% year on year
  • EPS, excluding charges and credits, of $0.75 increased 19% year on year
  • Net income attributable to SLB of $1.07 billion increased 14% year on year
  • Adjusted EBITDA of $2.06 billion increased 15% year on year
  • Cash flow from operations was $327 million
  • Board approved quarterly cash dividend of $0.275 per share.

Exciting Start to the Year

SLB CEO Olivier Le Peuch commented, ‘We have had an exciting start to the year with our announced agreement to acquire ChampionX Corporation (ChampionX), which will bolster our production and recovery portfolio. We also continued our growth momentum, with a strong first-quarter performance resulting from robust year-on-year revenue and EBITDA growth consistent with our first quarter and full-year guidance.

‘Compared to the same quarter last year, revenue increased 13%, EPS (excluding charges and credits) rose 19% to $0.75, adjusted EBITDA grew 15%, and adjusted EBITDA margin expanded year on year for the 13th consecutive quarter. Approximately half of the year-on-year revenue increase came from the Aker subsea business, which was added as part of our OneSubsea joint venture in the fourth quarter of 2023.

‘International revenue grew 18% year on year, compensating for a softer North American market where revenue declined 6%. Excluding the contribution of the Aker subsea business, international revenue grew 10%.

‘During the quarter, we continued to benefit from our favorable exposure to the international markets, with remarkable year-on-year growth of 29% in the Middle East & Asia, in addition to growth of 18% in Europe & Africa.

‘Sequentially, revenue declined 3% both in North America and in the international markets due to seasonality. However, this impact was less pronounced than in prior years as robust activity gains partially offset seasonal effects.

‘I want to extend my appreciation to the SLB team for achieving these outstanding results. I look forward to building on this momentum in the coming quarters.”

First Quarter Powered by the Core

‘Our Core business—comprising Reservoir Performance, Well Construction, and Production Systems—achieved revenue growth of 13% year on year and expanded pretax segment operating margin by more than 200 basis points (bps). This growth was supported by investments in long-cycle developments and production capacity expansions, particularly in the Middle East & Asia and Latin America.

‘Production Systems revenue grew 28% year on year driven by the acquired Aker subsea business. Excluding the contribution of the Aker subsea business, Production Systems revenue grew 6% driven by a double-digit increase in international revenue resulting from higher sales of completions, surface production systems, and artificial lift. Reservoir Performance revenue increased 15% year on year due to increased stimulation, evaluation, and intervention services across all areas on land and offshore and from both exploration and production activity. Well Construction grew 3% year on year driven by a 9% increase in international revenue, led by Middle East & Asia but partially offset by reduced activity in North America.’

Revenue Growth, Margin Expansion, and Returns to Shareholders

‘We remain confident in our global revenue growth outlook for 2024, with softness in North America being offset by upside in the international markets. The dynamics of this cycle remain intact, with international and offshore growth taking place across all geographies, benefiting all of our Divisions as we continue to be awarded new contracts, enhancing the quality and longevity of our revenue backlog.

‘Our journey of margin expansion continues to be driven by tight service and equipment capacity internationally, increased technology adoption, and further operational efficiency. As a result, we affirm our previous guidance of mid-teens EBITDA growth for the full year.

‘Turning specifically to the second quarter, we expect a seasonal rebound in activity in the Northern Hemisphere coupled with robust activity internationally, led by the Middle East, Asia, and Africa. This will drive broad sequential margin expansion across all Divisions and geographies.

‘Based on our strong start to the year, confidence in our ability to generate robust cash flows, and the anticipated contribution of the announced ChampionX acquisition, we are targeting to return $7 billion to shareholders over the next two years. This represents a target for returns to shareholders of $3 billion in 2024 and $4 billion in 2025.’

The Momentum Continues

‘The oil and gas industry continues to benefit from strong market fundamentals driven by a growing demand outlook. This is resulting in a significant baseload of activity, particularly in the international and offshore markets, closely aligned with the strengths of our business. As the cycle persists, we expect operators to increase their investments in production and reservoir recovery, with the goal of maximizing the efficiency and longevity of their producing assets. This will result in operating expenditures becoming an increasing part of global upstream spending over time.

‘We are already benefiting from these investments, and our recently announced agreement to acquire ChampionX will position us to further capture this growing opportunity through the addition of a leading production chemicals portfolio and a complementary artificial lift offering. We look forward to harnessing the strong capabilities of ChampionX to deliver superior performance for our customers.

‘There also continues to be a growing emphasis across the industry on emissions reduction. This is presenting an exciting new market for lower-carbon technologies and carbon capture and sequestration (CCS), where we are positioned very well, as exemplified by the expansion of our CCS portfolio with our recent announcement of our agreement to acquire a majority ownership stake in Aker Carbon Capture.

‘All in all, the dynamics of the cycle continue to reinforce our strategy and outlook for the future. I look forward to continuing to deliver exceptional service for our customers and results for our stockholders throughout the year.’