Schlumberger posts third straight quarterly loss as oil rout hits services demand

By Shariq Khan and Liz Hampton
(Reuters) - Leading oilfield services company Schlumberger NV posted its third straight quarter loss on Friday as this year's oil demand and prices reduced demand for its services due to the COVID-19 pandemic.
The company launched profits from hard-hit U.S. oilfield service providers as new lockdowns in some parts of the world threaten a rebound in oil demand due to a recurrence of infection. Global oil prices were trading at $ 42.56 a barrel on Friday, down 36% this year.
The North American markets performed much worse than the international markets. Schlumberger sales in the region decreased from $ 2.85 billion a year ago to $ 1.16 billion.
Total revenue decreased 38% to $ 5.26 billion.
Shares fell 5% to $ 15.52 in early trading.
"The international activities are stable after the budget resets that were completed in the third quarter," said CEO Olivier Le Peuch in a statement. The North American business is "set for sustained momentum," suggesting more drilling, but not yet completed drilling, and a modest resumption of drilling, he said.
International activity will pick up in 2022, Le Peuch shared among investors, suggesting that revenue from Schlumberger's largest sector would remain unchanged for the next year.
Last month, Schlumberger agreed to sell its North American shale fracking business to Liberty Oilfield Services as part of the Le Peuch restructuring to focus on high-tech businesses. He has been betting on asset sales and cost and job cuts to weather the weaker demand.
The company anticipates cost savings of $ 1.5 billion from its restructuring. Around 80% of this benefit was realized in the third quarter, Le Peuch told investors.
The company posted charges of $ 310 million in the third quarter, adding to over $ 12 billion in the previous two quarters. The cost of severance pay was $ 273 million for the quarter and $ 699 million year-to-date.
Le Peuch is also seeking new technology partnerships and accelerating Schlumberger's New Energy business, which aims at more sustainable energy production. This boost suits customers who are relocating their business to benefit from the energy transition.
Schlumberger reported a net loss of $ 82 million, or 6 cents per share, for the quarter ended September 30. Excluding fees and credits, Schlumberger made 16 cents per share for the quarter, helped by cost reductions.
The company recorded a net loss of $ 11.38 billion, or $ 8.22 per share, a year earlier from impairment charges.

(Reporting by Shariq Khan in Bengaluru and Liz Hampton in Denver; editing by Sriraj Kalluvila, editing by Chizu Nomiyama and Steve Orlofsky)

Click to receive the most important news as a notification!

Last News

This Is the Real Difference Between Pinot Noir, Cabernet, and Other Red Wines

Carly Fiorina on how the business community thinks about Trump and its response to the pandemic

Gordon Ramsay Responded To A TikTok User Who Said The Chef 'Can't Cook'

2020 polls: The Trump ‘hidden voter’ isn’t a real threat this election - here’s why

Jimmy Garoppolo's flop vs. Patriots after late hit won't win him Oscar

The Best 10-Minute Desserts to Satisfy Your Sweet Tooth, Like, Now