SLB has reported net income attributable to the company of $2.06 billion for the first quarter, a 15 percent increase year over year.The energy technology firm’s first-quarter revenue was recorded at $8.71 billion, a 13 percent increase compared to $7.74 billion in the same period last year, according to SLB’s most recent earnings release.
SLB CEO Olivier Le Peuch said, “We have had an exciting start to the year with our announced agreement to acquire ChampionX Corporation, 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”.
Earlier in the month, SLB announced a definitive agreement to purchase ChampionX in an all-stock transaction. Under the terms of the deal, ChampionX shareholders will receive 0.735 shares of SLB common stock in exchange for each ChampionX share. At the closing of the transaction, ChampionX shareholders will own approximately nine percent of SLB’s outstanding shares of common stock, according to an earlier statement.
Enverus Intelligence Research (EIR) Senior Vice President Mark Chapman said that SLB’s ChampionX deal is the largest transaction EIR has seen in the oilfield services market since the 2020 downturn. In a statement, Chapman said SLB acquiring ChampionX “is a play to capture upstream OPEX for the future”.
Le Peuch continued, “Compared to the same quarter last year, revenue increased 13 percent, [earnings per share] EPS (excluding charges and credits) rose 19 percent to $0.75, adjusted EBITDA grew 15 percent, 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”.
Commenting on industry trends, Le Peuch said, “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,” he continued.
“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”, he remarked.
Source:https://www.rigzone.com