SLB has reported its third quarter results of 2023 (3Q23), achieving a net profit of $1.12 billion in the third quarter of 2023, or $0.78 per share, compared to a net gain of $907 million, or $0.67 per share, in the same period a year ago.
Moreover, the company achieved adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $2.08 billion, a 6% increase from the previous quarter and an 18% year-on-year uptick.
SLB’s results snapped a string of nine straight quarters of revenue expansion in North America, while sales in the Middle East and Asia climbed to the highest level in almost nine years.
“Third-quarter revenue increased 3% sequentially—by more than $200 million—driven by the Middle East and Asia, which increased 8% in the quarter and continues to demonstrate positive investment momentum,” said SLB CEO Olivier Le Peuch, noting the company’s quarterly performance was propelled by broad-based growth across Saudi Arabia, the United Arab Emirates, Egypt, Indonesia, China, Malaysia, Kuwait, and Oman.
In Egypt, Petrojet awarded SLB a contract for detailed engineering, procurement, commissioning, and startup of the Meleiha gas treatment plant, with further opportunities for operations and maintenance in the future.
The project is located in the Western Desert and is owned by Agiba Petroleum Company, an Eni/EGPC joint venture. Petrojet is the main engineering, procurement, construction, and commissioning contractor. The project will adopt a zero-flaring approach, in line with the SLB decarbonization strategy.
“Similarly, revenue in our offshore business grew as our activity continues to benefit from operators working to renew supply, accelerate cycle times, and increase the productivity of their assets. This was particularly notable in offshore Africa, Brazil, and Scandinavia,” Le Peuch added.
The company’s third-quarter pretax segment operating margin expanded 73 bps sequentially in addition to generating strong cash flow from operations of $1.68 billion and free cash flow of $1.04 billion.
During the quarter, SLB repurchased 2.6 million shares of its common stock at an average price of $57.46 per share, for a total purchase price of $151 million.
On October 2, 2023, SLB, Aker Solutions, and Subsea7 closed their previously announced joint venture. The new business, OneSubsea, aims to drive innovation and efficiency in subsea production by helping customers unlock reserves and reduce cycle time.
It will include an extensive complementary subsea production and processing technology portfolio, world-class manufacturing scale and capacity, access to industry-leading reservoir and digital domain expertise, unique pore-to-process integration capabilities, and strengthened R&D capabilities.
On October 19, 2023, SLB’s Board of Directors approved a quarterly cash dividend of $0.25 per share of outstanding common stock, payable on January 11, 2024, to stockholders of record on December 6, 2023.
“Looking ahead, we believe the market fundamentals remain very compelling for our business. The oil and gas industry continues to benefit from a multiyear growth cycle that has shifted to the international and offshore markets, where we are the clear leader,” Le Peuch commented on the results.
“Concurrently, upstream spending is accelerating as operators continue to invest in long-cycle developments, production capacity expansions, exploration and appraisal, and enhanced gas production. The long-term nature of these global investments underscores the breadth, durability, and resilience of this cycle, and we expect these market dynamics to continue to drive profitable growth in the years ahead,” he added.