RIO DE JANEIRO - Thursday, 27. April 2023
Revenue of $7.7 billion increased 30% year on year
GAAP EPS of $0.65 increased 81% year on year
EPS, excluding charges and credits, of $0.63 increased 85% year on year
Net income attributable to SLB of $934 million increased 83% year on year
Adjusted EBITDA of $1.8 billion increased 43% year on year
Cash flow from operations was $330 million
Board approved quarterly cash dividend of $0.25 per share
(BUSINESS WIRE) -- SLB (NYSE: SLB) today announced results for the first-quarter 2023.
First-Quarter Results
(Stated in millions, except per share amounts)
Three Months Ended Change
Mar. 31,
2023 Dec. 31,
2022 Mar. 31,
2022 Sequential Year-on-year
Revenue
$7,736
$7,879
$5,962
-2%
30%
Income before taxes - GAAP basis
$1,161
$1,347
$638
-14%
82%
Income before taxes margin - GAAP basis
15.0%
17.1%
10.7%
-208 bps 432 bps
Net income attributable to SLB - GAAP basis
$934
$1,065
$510
-12%
83%
Diluted EPS - GAAP basis
$0.65
$0.74
$0.36
-12%
81%
Adjusted EBITDA*
$1,788
$1,921
$1,254
-7%
43%
Adjusted EBITDA margin*
23.1%
24.4%
21.0%
-127 bps 208 bps
Pretax segment operating income*
$1,391
$1,557
$894
-11%
56%
Pretax segment operating margin*
18.0%
19.8%
15.0%
-178 bps 298 bps
Net income attributable to SLB, excluding charges & credits*
$906
$1,026
$488
-12%
86%
Diluted EPS, excluding charges & credits*
$0.63
$0.71
$0.34
-11%
85%
Revenue by Geography
International
$5,985
$6,194
$4,632
-3%
29%
North America
1,698
1,633
1,282
4%
32%
Other
53
52
48
n/m
n/m
$7,736
$7,879
$5,962
-2%
30%
*These are non-GAAP financial measures. See sections titled "Charges & Credits", "Divisions", and "Supplemental Information" for details.
n/m = not meaningful
(Stated in millions)
Three Months Ended Change
Mar. 31,
2023 Dec. 31,
2022 Mar. 31,
2022 Sequential Year-on-year
Revenue by Division
Digital & Integration
$894
$1,012
$857
-12%
4%
Reservoir Performance
1,503
1,554
1,210
-3%
24%
Well Construction
3,261
3,229
2,398
1%
36%
Production Systems
2,207
2,215
1,604
-
38%
Other
(129)
(131)
(107)
n/m
n/m
$7,736
$7,879
$5,962
-2%
30%
Pretax Operating Income by Division
Digital & Integration
$265
$382
$292
-31%
-9%
Reservoir Performance
242
282
160
-14%
52%
Well Construction
672
679
388
-1%
73%
Production Systems
205
238
114
-14%
80%
Other
7
(24)
(60)
n/m
n/m
$1,391
$1,557
$894
-11%
56%
Pretax Operating Margin by Division
Digital & Integration
29.6%
37.7%
34.0%
-810 bps -440 bps
Reservoir Performance
16.1%
18.2%
13.2%
-207 bps 291 bps
Well Construction
20.6%
21.0%
16.2%
-44 bps 444 bps
Production Systems
9.3%
10.8%
7.1%
-148 bps 217 bps
Other
n/m
n/m
n/m
n/m
n/m
18.0%
19.8%
15.0%
-178 bps 298 bps
n/m = not meaningful
Strong Growth and Broad-Based Attributes
SLB CEO Olivier Le Peuch commented, “I am very pleased with our start to 2023. We delivered strong year-over-year revenue growth and margin expansion at a scale that instills further confidence in our full-year financial ambition. The quarter was defined by strong activity dynamics offshore and in the broader international basins, most notably in Well Construction and Production Systems.
“Compared to the same period last year, revenue grew 30%; adjusted EBITDA increased 43%; EPS—excluding charges and credits—increased 85%; and pretax segment operating margin expanded 298 basis points (bps). All Divisions grew, both in North America and in the international markets, reflecting the strength of our portfolio across geographies and business lines. Revenue growth surpassed rig count growth both in North America and internationally—representing the highest year-on-year quarterly growth in more than a decade.
“Sequentially, revenue grew 4% in North America, our eighth consecutive quarter of growth, benefiting from our exposure to the most resilient basins and market segments. Internationally, the sequential revenue decline was less pronounced than historical trends as seasonal effects were partially offset by robust activity gains.
“We continue to see positive pricing as our performance differentiates, technology adoption increases, contract terms are adjusted to offset inflation, and service capacity continues to tighten in key international markets. In this environment, our customers are more actively collaborating with us to improve their operational performance, attain decarbonization objectives, and lower overall costs through the increased use of our differentiated technologies.
“First-quarter cash flow from operations was $330 million, reflecting the seasonal first-quarter buildup of working capital that will support our anticipated growth for the year and the payment of our annual incentives. Free cash flow generation is expected to accelerate throughout the year, consistent with historical trends.
Great Start to the Year Anchored on a Very Solid Core
“Year over year, our Core Divisions collectively grew by 34% and expanded operating margins by more than 300 bps. Each of the three Core Divisions delivered very strong growth and expanded margins—driven by increased activity, pricing, and technology adoption.
“In our Core, we continue to leverage the industry’s most comprehensive technology portfolio with disruptive fit-for-basin technologies, advanced digital solutions, and an unmatched ability to integrate across the entire value chain—from subsurface to midstream.
“In our Digital & Integration Division, digital sales posted strong year-on-year growth that is on track with our strategic ambition as we continue to secure new contracts and accelerate cloud and edge solutions. However, the increase in digital sales during the quarter was largely offset by a decline in Asset Performance Solutions (APS) revenue, arising from production interruptions in Ecuador and lower revenue from our Palliser asset in Canada.
A Resilient Cycle—Powered by the International and Offshore Markets
“Looking at the macro, we maintain our very constructive multiyear outlook as the upcycle attributes and key activity drivers continue to evolve very positively. The international and offshore markets continue to experience a strong resurgence of activity driven by resilient long-cycle development and capacity expansion projects. In contrast, the North American land market, which has led this upcycle in the early innings, could potentially result in an activity plateau in 2023 due to lower gas prices and capital restraint by private E&P operators.
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