- Fourth-quarter revenue of $8.99 billion increased 8%
sequentially and 14% year on year
- Fourth-quarter GAAP EPS of $0.77 decreased 1% sequentially and
increased 4% year on year
- Fourth-quarter EPS, excluding charges and credits, of $0.86
increased 10% sequentially and 21% year on year
- Fourth-quarter cash flow from operations was $3.02 billion and
free cash flow was $2.28 billion
- Board approved a 10% increase in quarterly cash dividend to
$0.275 per share
- Full-year revenue of $33.14 billion increased 18% year on
year
- Full-year GAAP EPS of $2.91 increased 22% year on year
- Full-year EPS, excluding charges and credits, of $2.98
increased 37% year on year
- Full-year net income attributable to SLB of $4.20 billion
increased 22% year on year
- Full-year adjusted EBITDA of $8.11 billion increased 25% year
on year
- Full-year cash flow from operations was $6.64 billion and free
cash flow was $4.04 billion
SLB (NYSE: SLB) today announced results for the fourth-quarter
and full-year 2023.
Fourth-Quarter Results
(Stated in millions, except per share amounts)
Three Months
Ended Change Dec. 31,2023 Sept. 30,2023 Dec.
31,2022
Sequential
Year-on-year Revenue
$8,990
$8,310
$7,879
8%
14%
Income before taxes - GAAP basis
$1,433
$1,395
$1,347
3%
6%
Income before taxes margin - GAAP basis
15.9%
16.8%
17.1%
-85 bps
-116 bps
Net income attributable to SLB - GAAP basis
$1,113
$1,123
$1,065
-1%
4%
Diluted EPS - GAAP basis
$0.77
$0.78
$0.74
-1%
4%
Adjusted EBITDA*
$2,277
$2,081
$1,921
9%
19%
Adjusted EBITDA margin*
25.3%
25.0%
24.4%
29 bps
95 bps
Pretax segment operating income*
$1,868
$1,683
$1,557
11%
20%
Pretax segment operating margin*
20.8%
20.3%
19.8%
52 bps
101 bps
Net income attributable to SLB, excluding charges & credits*
$1,242
$1,123
$1,026
11%
21%
Diluted EPS, excluding charges & credits*
$0.86
$0.78
$0.71
10%
21%
Revenue by Geography
International
$7,293
$6,614
$6,194
10%
18%
North America
1,641
1,643
1,633
-
-
Other
56
53
52
n/m
n/m
$8,990
$8,310
$7,879
8%
14%
*These are non-GAAP financial measures. See sections titled
"Divisions" and "Supplementary Information" for details. n/m = not
meaningful (Stated in millions)
Three Months Ended
Change Dec. 31,2023 Sept. 30,2023 Dec. 31,2022
Sequential Year-on-year
Revenue by Division Digital
& Integration
$1,049
$982
$1,012
7%
4%
Reservoir Performance
1,735
1,680
1,554
3%
12%
Well Construction
3,426
3,430
3,229
0%
6%
Production Systems
2,944
2,367
2,215
24%
33%
Other
(164)
(149)
(131)
n/m
n/m
$8,990
$8,310
$7,879
8%
14%
Pretax Operating Income by Division
Digital & Integration
$356
$314
$382
13%
-7%
Reservoir Performance
371
344
282
8%
31%
Well Construction
770
759
679
1%
13%
Production Systems
442
319
238
38%
85%
Other
(71)
(53)
(24)
n/m
n/m
$1,868
$1,683
$1,557
11%
20%
Pretax Operating Margin by Division
Digital & Integration
34.0%
32.0%
37.7%
197 bps
-375 bps
Reservoir Performance
21.4%
20.5%
18.2%
88 bps
319 bps
Well Construction
22.5%
22.1%
21.0%
35 bps
143 bps
Production Systems
15.0%
13.5%
10.8%
153 bps
426 bps
Other
n/m
n/m
n/m
n/m
n/m
20.8%
20.3%
19.8%
52 bps
101 bps
n/m = not meaningful
Full-Year Results
(Stated in millions, except per
share amounts)
Twelve Months Ended
Dec. 31, 2023 Dec. 31, 2022
Change
Revenue
$33,135
$28,091
18%
Income before taxes - GAAP basis
$5,282
$4,271
24%
Income before taxes margin - GAAP basis
15.9%
15.2%
74 bps
Net income attributable to SLB - GAAP basis
$4,203
$3,441
22%
Diluted EPS - GAAP basis
$2.91
$2.39
22%
Adjusted EBITDA*
$8,107
$6,462
25%
Adjusted EBITDA margin*
24.5%
23.0%
147 bps
Pretax segment operating income*
$6,523
$5,011
30%
Pretax segment operating margin*
19.7%
17.8%
185 bps
Net income attributable to SLB, excluding charges & credits*
$4,305
$3,138
37%
Diluted EPS, excluding charges & credits*
$2.98
$2.18
37%
Revenue by Geography
International
$26,188
$21,895
20%
North America
6,727
5,995
12%
Other
220
201
n/m
$33,135
$28,091
18%
*These are non-GAAP financial measures. See sections titled
"Charges & Credits", "Divisions", and "Supplemental
Information" for details. n/m = not meaningful (Stated in millions)
Twelve Months Ended Dec. 31, 2023 Dec. 31, 2022
Change Revenue by Division Digital & Integration
$3,871
$3,725
4%
Reservoir Performance
6,561
5,553
18%
Well Construction
13,478
11,397
18%
Production Systems
9,831
7,862
25%
Other
(606)
(446)
n/m
$33,135
$28,091
18%
Pretax Segment Operating Income
Digital & Integration
$1,257
$1,357
-7%
Reservoir Performance
1,263
881
43%
Well Construction
2,932
2,202
33%
Production Systems
1,245
748
66%
Other
(174)
(177)
n/m
$6,523
$5,011
30%
Pretax Segment Operating Margin
Digital & Integration
32.5%
36.4%
-397 bps
Reservoir Performance
19.2%
15.9%
338 bps
Well Construction
21.8%
19.3%
243 bps
Production Systems
12.7%
9.5%
315 bps
Other
n/m
n/m
n/m
19.7%
17.8%
185 bps
Adjusted EBITDA
Digital & Integration
$1,847
$1,872
-1%
Reservoir Performance
1,646
1,233
33%
Well Construction
3,514
2,701
30%
Production Systems
1,569
1,047
50%
Other
102
95
n/m
$8,678
$6,948
25%
Corporate & other
(571)
(486)
n/m
$8,107
$6,462
25%
Adjusted EBITDA Margin
Digital & Integration
47.7%
50.3%
-255 bps
Reservoir Performance
25.1%
22.2%
287 bps
Well Construction
26.1%
23.7%
237 bps
Production Systems
16.0%
13.3%
264 bps
Other
n/m
n/m
n/m
26.2%
24.7%
146 bps
Corporate & other
n/m
n/m
n/m
24.5%
23.0%
147 bps
n/m = not meaningful (Stated in millions)
Twelve
Months Ended Dec. 31, 2023 Dec. 31, 2022
Change
Revenue by Geography North America
$6,727
$5,995
12%
Latin America
6,645
5,661
17%
Europe & Africa*
8,524
7,201
18%
Middle East & Asia
11,019
9,033
22%
Other
220
201
n/m
$33,135
$28,091
18%
International
$26,188
$21,895
20%
North America
6,727
5,995
12%
Other
220
201
n/m
$33,135
$28,091
18%
Pretax Segment Operating Income
International
$5,486
$4,063
35%
North America
1,157
1,106
5%
Other
(120)
(158)
n/m
$6,523
$5,011
30%
Pretax Segment Operating Income Margin
International
20.9%
18.6%
239 bps
North America
17.2%
18.4%
-124 bps
Other
n/m
n/m
n/m
19.7%
17.8%
185 bps
Adjusted EBITDA
International
$6,988
$5,425
29%
North America
1,559
1,470
6%
Other
131
53
n/m
$8,678
$6,948
25%
Corporate & other
(571)
(486)
n/m
$8,107
$6,462
25%
Adjusted EBITDA Margin
International
26.7%
24.8%
191 bps
North America
23.2%
24.5%
-135 bps
Other
n/m
n/m
n/m
26.2%
24.7%
146 bps
Corporate & other
n/m
n/m
n/m
24.5%
23.0%
147 bps
*Includes Russia and the Caspian region n/m = not meaningful
Impressive Fourth-Quarter and Full-Year Performance
SLB CEO Olivier Le Peuch commented, “We have concluded a
remarkable year marked by widespread revenue growth, margin
expansion, and exceptional free cash flow. Year on year, we grew
revenue and EBITDA 18% and 25%, respectively, and we delivered $4.0
billion of free cash flow—allowing us to reduce net debt by $1.4
billion and return $2.0 billion to shareholders this year through
dividends and stock repurchases. These results showcase our
continued ability to deliver superior earnings, generate impressive
cash flows, and maintain a strong balance sheet.
“Sequentially, fourth-quarter revenue rose 8%, EPS (excluding
charges and credits) increased 10% to $0.86, and adjusted EBITDA
margins reached another cycle high. Notably, the acquired Aker
subsea business accounted for approximately 70% of the sequential
revenue growth, while the legacy portfolio continued its growth
trajectory in the international markets.
“Compared to the same quarter last year, international revenue
outpaced North America, growing 18% while North America was
relatively flat. Excluding the acquired Aker subsea business,
international revenue grew 10% year on year, marking the 10th
consecutive quarter of double-digit growth. Our global pretax
segment operating margin increased year on year for the 12th
consecutive quarter, and we exited the year with a quarterly
international margin reaching a new high in the cycle.”
A Remarkable Year of Broad, Resilient, and Durable
Growth
“We concluded the year with 37% growth in EPS (excluding charges
and credits) and expanded adjusted EBITDA margin by 147 basis
points (bps). Additionally, we generated $6.64 billion in cash flow
from operations and delivered return on capital employed (ROCE) of
16%, the highest level since 2014—a result of our returns-focused
strategy.
“Our strong full-year performance was fueled by substantial
international growth, with approximately 90% of our international
GeoUnits posting year-on-year increases, complemented by sustained
performance in North America.
“International revenue grew 20% year on year—by more than $4
billion—and pretax segment operating margins expanded by 239 bps.
Notably, we achieved our highest-ever revenue in the Middle East,
led by impressive growth in Saudi Arabia, the United Arab Emirates,
and Egypt & East Mediterranean GeoUnits.
“In the offshore basins, we benefited from long-cycle
developments, capacity expansions, and exploration and appraisal
activities with remarkable growth in Brazil and Angola and very
solid increases in the US Gulf of Mexico, Guyana, and Norway.
“In North America, while activity moderated as expected in the
second half of the year, revenue increased by 12% year on year,
outpacing the rig count. This outperformance was driven by our
technology-leveraged portfolio in both US land and the US Gulf of
Mexico.
“On a divisional basis, our Core business—comprising Reservoir
Performance, Well Construction, and Production Systems—accelerated,
growing revenue 20% year on year and expanding pretax segment
operating margin 277 bps.
“Digital & Integration revenue increased 4% year on year.
This was led by Digital, which continued strong growth momentum,
delivering more than $2 billion in revenue while APS revenue
declined. Our success in Digital was driven by further adoption of
Delfi™ technology and customers embracing our connected and
autonomous drilling, data, and AI solutions.
“We also saw continued adoption of our Transition Technologies™
portfolio as customers look to enhance efficiency and reduce
emissions. The imperative to operate more sustainably is
translating into tangible investments by our customers, resulting
in the portfolio generating more than $1.0 billion of revenue.
“We are also very pleased to see our strategic focus on customer
centricity continue to translate into customer satisfaction, with
our performance and value creation achieving recognition in various
industry surveys.
“I am extremely proud of our full-year results, and I would like
to thank the entire SLB team for delivering this outstanding
performance.”
Further International Growth and Shareholder Returns
Ahead
“As global energy demand continues to increase, international
production is expected to play a key role in meeting supply through
the end of the decade. Notably, we anticipate record investment
levels in the Middle East extending beyond 2025, with significant
expansion in Saudi Arabia, the United Arab Emirates, Iraq, and
Kuwait. Offshore remains another distinct attribute of this durable
growth cycle, serving as an important source for production growth
and capacity additions, and we expect strong activity to continue
in Brazil, West Africa, the Eastern Mediterranean, the Middle East,
and Southeast Asia.
“In the international environment, despite elevated geopolitical
tensions in various regions, we do not anticipate a significant
impact on the sector’s overall activity, absent any escalation.
Furthermore, we expect the long-cycle investments across the Middle
East, global offshore, and gas resource plays to be largely
decoupled from short-term commodity price fluctuations.
“In 2024, we will experience another year of strong growth
driven by the international markets. Benefiting from these market
dynamics, we foresee further growth led by Production Systems,
strengthened by the additional subsea opportunities from our
OneSubsea joint venture. Sustained momentum is expected in
Reservoir Performance, accompanied by increased activity in Well
Construction. Additionally, we expect continued customer adoption
of our Digital business, particularly in our new technology
platforms.
“Our performance and returns-focused strategy, combined with our
differentiated market positioning and digital capabilities, will
drive profitable growth and further margin expansion, setting a
strong foundation for long-term outperformance.
“With confidence in the strength and longevity of the cycle and
visibility into sustained strong cash flows, we are pleased to
announce that our Board of Directors has approved a 10% increase to
our quarterly dividend. Additionally, we plan to increase share
repurchases in 2024, visibly enhancing returns to shareholders for
the full year.
“With a clear strategy, a uniquely positioned portfolio, and the
right team in place, we look forward to delivering value for our
customers and our shareholders in the years ahead.”
Other Events
During the quarter, SLB repurchased 1.8 million shares of its
common stock at an average price of $54.46 per share for a total
purchase price of $100 million.
On January 18, 2024, SLB’s Board of Directors approved a 10%
increase in SLB’s quarterly cash dividend from $0.250 per share of
outstanding common stock to $0.275 per share, beginning with the
dividend payable on April 4, 2024, to stockholders of record on
February 7, 2024.
Fourth-Quarter Revenue by Geographical Area
(Stated in millions)
Three Months Ended Change
Dec. 31,2023 Sept. 30,2023 Dec. 31,2022
Sequential
Year-on-year North America
$1,641
$1,643
$1,633
-
-
Latin America
1,722
1,681
1,619
2%
6%
Europe & Africa*
2,429
2,091
2,067
16%
18%
Middle East & Asia
3,141
2,842
2,508
11%
25%
Eliminations & other
57
53
53
n/m
n/m
$8,990
$8,310
$7,879
8%
14%
International
$7,292
$6,614
$6,194
10%
18%
North America
$1,641
$1,643
$1,633
-
-
*Includes Russia and the Caspian
region
n/m = not meaningful
International
Revenue in Latin America of $1.72 billion increased 2%
sequentially due mainly to the Aker subsea acquisition driving
growth in Brazil. Year on year, fourth-quarter revenue grew 6%,
fueled by heightened sales of production systems and the impact of
the acquired Aker subsea business. Increased intervention,
stimulation, and drilling activity in Argentina also contributed to
the year-on-year revenue growth.
Europe & Africa revenue of $2.43 billion increased
16% sequentially mainly driven by the acquired Aker subsea
business, which accounted for most of the sequential revenue
growth, primarily in Scandinavia. The growth was further boosted by
intensified offshore exploration, drilling, and production activity
in the Angola, Central & East Africa GeoUnit. Year on year,
fourth-quarter revenue grew 18%, with revenue offshore Africa
nearly doubling, driven by heightened exploration, drilling, and
production activities. The Aker subsea business in the Scandinavia
GeoUnit also contributed to the year-on-year revenue surge, offset
in part by reduced revenue in Russia.
Revenue in the Middle East & Asia of $3.14 billion
increased 11% sequentially fueled by robust activity growth in
Saudi Arabia, the United Arab Emirates, Qatar, Egypt & East
Mediterranean, East Asia, and Oman GeoUnits. This increase was
driven by higher drilling, intervention, stimulation, and
evaluation activity, both on land and offshore. Year on year,
fourth-quarter revenue increased 25%, propelled by significant
growth in Saudi Arabia, the United Arab Emirates, Egypt & East
Mediterranean, Kuwait, Oman, and East Asia GeoUnits.
North America
North America revenue of $1.64 billion was flat
sequentially as reduced drilling activity in US land and Canada was
offset by higher offshore revenue in the US Gulf of Mexico.
Offshore revenue increased as a result of higher subsea production
systems sales and the acquisition of the Aker subsea business. Year
on year, North America revenue was flat as reduced drilling
activity in US land and lower APS project revenue in Canada were
offset by higher revenue offshore.
Fourth-Quarter Results by Division
Digital & Integration
(Stated in millions)
Three Months Ended Change
Dec. 31,2023 Sept. 30,2023 Dec. 31,2022
Sequential
Year-on-year Revenue International
$790
$737
$723
7%
9%
North America
257
242
288
6%
-11%
Other
2
3
1
n/m
n/m
$1,049
$982
$1,012
7%
4%
Pretax operating income
$356
$314
$382
13%
-7%
Pretax operating margin
34.0%
32.0%
37.7%
197 bps
-375 bps
n/m = not meaningful
Digital & Integration revenue of $1.05 billion increased 7%
sequentially due to increased Digital revenue across all areas led
by the Middle East & Asia and Europe & Africa, including
higher exploration data sales in North America. Year on year,
revenue increased 4% due to strong international growth in Digital
revenue despite lower exploration data sales in the US Gulf of
Mexico, due to licensing round delays, partially offset by lower
APS revenue in Canada.
Digital & Integration pretax operating margin of 34%
expanded 197 bps sequentially due to improved profitability in
Digital. Year on year, pretax operating margin decreased 375 bps
due to reduced profitability in APS, which was impacted by lower
commodity prices in Canada.
Reservoir Performance
(Stated in millions)
Three Months Ended Change
Dec. 31,2023 Sept. 30,2023 Dec. 31,2022
Sequential
Year-on-year Revenue International
$1,611
$1,554
$1,430
4%
13%
North America
123
125
123
-2%
0%
Other
1
1
1
n/m
n/m
$1,735
$1,680
$1,554
3%
12%
Pretax operating income
$371
$344
$282
8%
31%
Pretax operating margin
21.4%
20.5%
18.2%
88 bps
319 bps
n/m = not meaningful
Reservoir Performance revenue of $1.73 billion grew 3%
sequentially primarily due to increased stimulation, intervention,
and evaluation activity internationally, mainly in the Middle East
and Africa. Strong growth occurred in Qatar and Saudi Arabia on
higher evaluation and stimulation activity, respectively.
Year on year, revenue increased 12% across all international
areas, led by the Middle East & Asia and supported by higher
evaluation, intervention, and stimulation activity.
Reservoir Performance pretax operating margin of 21% expanded 88
bps sequentially and 319 bps year on year, representing the highest
level of pretax operating margin in this cycle. These increases
were primarily driven by higher activity, pricing, and improved
operating leverage across evaluation and stimulation. New
technology deployment also contributed to the margin expansion,
particularly in the Middle East and Europe.
Well Construction
(Stated in millions)
Three Months Ended Change
Dec. 31,2023 Sept. 30,2023 Dec. 31,2022
Sequential
Year-on-year Revenue International
$2,748
$2,707
$2,522
2%
9%
North America
614
663
652
-7%
-6%
Other
64
60
55
n/m
n/m
$3,426
$3,430
$3,229
-
6%
Pretax operating income
$770
$759
$679
1%
13%
Pretax operating margin
22.5%
22.1%
21.0%
35 bps
143 bps
n/m = not meaningful
Well Construction revenue of $3.43 billion was flat sequentially
with international growth being offset by a decline in North
America revenue. International revenue increased 2% driven
primarily by strong growth in the Middle East & Asia and
Africa. Year on year, revenue increased 6%, driven by strong growth
in the Middle East & Asia and Africa due to very strong
measurements, fluids, and equipment sales activity. This increase
was partially offset by declines in North America, Latin America,
and Russia.
Well Construction pretax operating margin of 22% expanded 35 bps
sequentially driven by improved profitability from increased
activity in the Middle East & Asia and Africa. This was
partially offset by the decline in activity in North America and
the onset of seasonal effects in the Northern Hemisphere. Year on
year, pretax operating margin expanded 143 bps with profitability
improving in measurements and fluids as a result of higher activity
in the Middle East & Asia and Africa.
Production Systems
(Stated in millions)
Three Months Ended Change
Dec. 31, 2023
Sept. 30,2023 Dec. 31,2022
Sequential Year-on-year Revenue
International
$2,276
$1,740
$1,638
31%
39%
North America
666
626
575
6%
16%
Other
2
1
2
n/m
n/m
$2,944
$2,367
$2,215
24%
33%
Pretax operating income
$442
$319
$238
38%
85%
Pretax operating margin
15.0%
13.5%
10.8%
153 bps
426 bps
n/m = not meaningful
Production Systems revenue of $2.94 billion increased 24%
sequentially and 33% year on year, mainly due to the acquired Aker
subsea business. Excluding the acquired Aker subsea business,
revenue grew 4% sequentially and 11% year on year driven by strong
international sales. Organic sequential growth was due to strong
international sales of midstream, artificial lift, and subsea
production systems, partially offset by reduced sales of
completions. Organic year-on-year growth was driven by strong
international sales of subsea production systems, completions, and
artificial lift.
Production Systems pretax operating margin expanded 153 bps
sequentially to 15%, its highest level in this cycle. The expansion
was driven primarily by higher sales of midstream, artificial lift,
and subsea production systems. Year on year, pretax operating
margin expanded 426 bps led by improved profitability in
completions, surface production systems, artificial lift, and
subsea production systems and driven by an improved activity mix,
pricing, and the easing of supply chain constraints.
Quarterly Highlights
CORE
Contract Awards
SLB continues to win new contract awards that align with SLB’s
core strengths, particularly in the international and offshore
basins. Notable highlights include the following:
- In Canada, offshore Newfoundland and Labrador, Cenovus Energy
awarded SLB a five-year contract for well construction and
associated services. SLB will provide drilling and completion fluid
work in the West White Rose field.
- In Mexico, SLB was awarded two contracts covering a period of
more than two years for our main customer in Mexico. The first
contract is for wellheads and trees and the second is for mudline
systems.
- In Argentina, Energía Argentina awarded SLB a contract for
valves for the Presidente Nestor Kirchner (GPNK) gas pipeline. The
GPNK pipeline will increase the gas transport capacity from the
Vaca Muerta gas field to consumption centers in northern Argentina.
Additionally, due to strong performance, Energía Argentina awarded
SLB an extension of the current contract for the northern gas
pipeline reversion. The pipeline will replace 2.4 billion cubic
meters per year of imported liquified natural gas and liquid fuels
with Argentine fuels.
- In Libya, Repsol awarded SLB and partner National Oil Wells
Drilling & Workover Company a contract for integrated well
construction services. The contract scope includes project
management and all drilling and well testing services, including
SLB core and rig services and products. The contract is for two
exploration wells plus one optional well. SLB will deploy its
integration expertise and technology workflows with the objective
of de-risking the exploration well delivery and improving the
exploration and appraisal success rate for Repsol.
- Also in Libya, Nafusah awarded SLB a three-year contract for
the engineering, procurement, and commissioning (EPC), as well as
startup and operations of an early production facility using one of
SLB’s Production ExPRESS™ rapid production response solutions.
Located in North Hamada Area 47, the project will be capable of
processing up to 10,000 barrels of fluid per day. The Production
ExPRESS design is a fit-for-purpose mobile and efficient solution
that will allow Nafusah to acquire additional reservoir information
and fast-track hydrocarbon production with a reduced capex over the
additional EPC project’s design while preserving cash flow and
continuous well deliverability.
- In the Kingdom of Saudi Arabia, Saipem awarded SLB a contract
for high-pressure shallow-water subsea Grove™ top entry ball
valves, RING-O™ swing check valves, and LEDEEN™ actuators for the
Qatif, Marjan, Abu Safah, and Safaniyah fields. The valves and
actuators are to be installed in shallow-water subsea lines that
are critical for permanent downhole monitoring.
- In Kazakhstan, the national oil company subsidiary OzenMunaiGas
awarded SLB a performance-based contract for rental of electric
submersible pumps (ESP) and associated services for 150 wells in
the Ozen Field. SLB will provide technological solutions to address
challenges such as depleted reservoirs, scaling, corrosion, and
paraffin deposition, while targeting an increase in production and
equipment performance.
- In Malaysia, PETRONAS Carigali Sdn Bhd (PCSB) awarded SLB a
five-year contract to deploy coiled tubing drilling services on
PCSB operations. PCSB aims to increase its efficiency and
production, while simultaneously reducing emissions and cost. The
contract will start with candidate studies, in which PCSB and SLB
will collaborate to identify wells that are applicable for coiled
tubing drilling operations.
- In northwest China, Sinopec Northwest China Petroleum Bureau
awarded SLB a contract for engineering analysis and a full suite of
rotary steerable solutions for three extended reach wells. This
followed a successful run in a 10,000-meter, high-temperature,
highly deviated well.
- In Australia, Woodside Energy contracted with the OneSubsea
integrated field development group to identify the appropriate
development concept for Phase 3 of the Julimar-Brunello project,
adding a tieback for additional wells for production to the
Wheatstone platform. The collaborative approach enabled the rapid
creation of a compelling business case for advancing the project.
The collaboration between Woodside and OneSubsea is an example of
the OneSubsea Agile SPS development approach for subsea production
systems, which facilitates efficient decision making and optimizes
subsea development.
Technology and Performance
Notable technology introductions and deployment in the quarter
include the following:
- In Turkey, SLB and Zorlu Enerji deployed a Reda Thermal™
power-efficient geothermal ESP in the deepest and hottest condition
for an ESP, with a pump setting depth of 1,700 meters and
bottomhole temperature of 230°C. The ESP deployment enabled
generation of 2.98 megawatts of zero-carbon electricity in a
previously untapped well, a further achievement to the Kizildere
geothermal power facility project in which Zorlu Enerji and SLB
have completed more than 10 high-enthalpy geothermal wells with the
Reda Thermal ESP technology.
- In Libya, Mellitah Oil & Gas awarded SLB a new stimulation
campaign based on the application of the OneSTEP EF™ efficient,
low-risk sandstone stimulation solution in three wells in the giant
Bu Attifel Field. After stimulation of the three wells, total oil
and gas production increased 180% and 140%, respectively. The
simplified operations of OneSTEP EF resulted in 50% less fluid
volume required for the stimulation job compared to conventional
stimulation volumes, thereby increasing safety and reducing
environmental impact with a smaller operational footprint and less
volume of disposed fluid.
- In Indonesia, SLB provided well construction and reservoir
performance services and the subsea landing string for the Geng
North-1 exploration well located in Makassar Strait. The deployment
of multiple SLB technologies enabled testing of the massive
reservoir accurately and efficiently, with up to 88% savings in
time compared to conventional technology. Deployment in the harsh
high-pressure deepwater environment proved the robustness and value
of these high-end technologies, which included the Saturn™ 3D
radial probe with the InSitu Fluid Analyzer™ real-time downhole
fluid analysis system and the subsequent deployment of multiple
Symphony™ live downhole reservoir testing interfaces for the first
time in Indonesia.
Decarbonization
SLB is focused on developing and implementing technologies that
can reduce emissions and environmental impact with practical,
quantifiably proven solutions both in our Core operations and in
adjacent industries. An example includes the following:
- SLB End-to-end Emissions Solutions (SEES) has been selected by
integrated energy company Eni to deliver comprehensive fugitive
methane emissions measurement and reporting plans for Eni’s global
operating facilities. The project, which is already in progress,
aligns with the reporting standards of the Oil & Gas Methane
Partnership 2.0—the flagship methane reporting and mitigation
program of the United Nations Environment Programme. It aims to
provide Eni with an accurate account of its fugitive methane
emissions for transparent reporting purposes and to inform Eni’s
strategic efforts to reduce fugitive emissions. Methane is a potent
greenhouse gas that has a climate change impact up to 84 times
greater than carbon dioxide over a 20-year timescale and represents
about half of the oil and gas sector’s operational emissions.
DIGITAL
SLB is deploying digital technology at scale, partnering with
customers to migrate their technology and workflows into the cloud,
embrace new AI-enabled capabilities, and leverage insights to
elevate their performance. Notable highlights include the
following:
- SLB and Geminus AI announced an investment and technology
partnership agreement to deploy the first physics-informed AI model
builder for oil and gas operations. The Geminus model builder fuses
physics-based approaches with process data to produce highly
accurate AI models that can be deployed at scale, far faster and at
much lower cost than traditional AI approaches. Data scientists and
modeling engineers can use the platform to predict the behavior of
complex reservoir systems and make informed real-time
decisions.
- SLB and Nabors Industries announced a collaboration to scale
the adoption of automated drilling solutions for oil and gas
operators and drilling contractors. The agreement will enable
customers to seamlessly integrate the companies’ drilling
automation applications and rig operating systems to deliver
improved well construction performance and efficiency. The new
integration provides customers with access to a broader suite of
drilling automation technologies and greater flexibility to utilize
their existing rig control systems and equipment on either SLB’s
PRECISE™ or Nabors’ SmartROS® rig operating systems.
- Azule Energy, a joint venture of bp and Eni Angola, the largest
independent energy producer in Angola, has awarded SLB a contract
to deploy the Delfi digital platform. The contract scope covers the
digital transformation of Azule across exploration and production
operations, including moving subsurface workflows to the cloud.
Azule is targeting improvements in business operations and
productivity by using AI and machine learning to drive increased
insights from data, accelerating workflows and
decision-making.
- In Colombia, Lewis Energy Colombia Inc. awarded SLB a
three-year software-as-a-service contract to deploy the Delfi
digital platform. Lewis will migrate and integrate data from
Studio™ E&P knowledge software into digital subsurface
workflows in the Delfi platform to improve the performance and
efficiency of its operations and enable effective responses to
daily challenges.
- In Kuwait, the Kuwait Drilling Company (KDC) entered into a
contract with SLB to deploy the DrillPlan™ coherent well design and
engineering solution on Delfi as the planning environment for its
directional drilling services. The DrillPlan solution enables KDC
to produce better drilling plans quickly and efficiently by using
AI, machine learning, and the high-performance computing
environment on the cloud.
- Also in Kuwait, Kuwait Oil Company (KOC) partnered with SLB
INNOVATION FACTORI to develop and deploy AI and machine
learning-based drilling, production, and subsurface workflows for
its multiple assets utilizing Dataiku’s AI platform and SLB Petrel™
subsurface software and Techlog™ wellbore software. SLB and KOC
worked together to develop a novel process to automate mud loss
analysis and forecast potential losses and their severity in
planned wells, using machine learning. This predictive capability
reduces nonproductive time and mitigates associated costs for well
control, including rig expenses, lost circulation material, and
cement plugs.
NEW ENERGY
SLB continues to participate in the global transition to
low-carbon energy systems through innovative technology and
strategic partnerships, including the following:
- In the North Sea, SLB and Northern Lights Joint Venture have
signed a memorandum of understanding with Microsoft to optimize
integrated cloud-based workflows for the operation of Northern
Lights, one of the first CO2 transport and storage providers for
cross-border carbon capture and storage (CCS). The collaboration
will contribute to the development of scalable and cost-efficient
digital solutions for the emerging CCS industry. In the initial
phases of the collaboration, SLB will extend its digital CCS
workflows and numerical simulation systems on Delfi, which was
deployed to streamline the subsurface workflows of Northern Lights
in 2022.
- In the United Arab Emirates, Sharjah National Oil Corporation
awarded SLB a CCS consultancy project with the objective to inject
CO2 and other gases into mature onshore Sharjah gas fields. SLB
will leverage its storage site evaluation solution, which
incorporates measurement, monitoring, and verification planning,
and will apply SLB technical expertise and experience in reservoir
management and subsurface technologies to evaluate capacity,
injectivity, and containment. The project will assess the carbon
storage potential for reliability, economics, and sustainability
and provide consultation on the injection and monitoring
strategy.
- In Japan, INPEX and JOGMEC completed a carbon capture,
utilization, and storage pilot test in the Minami-aga depleted oil
and gas field with SLB technology providing support for two
injection wells and a short-term injection test. In the drilling
phase, Sonic Scanner™ acoustic scanning platform and MDT™ modular
formation dynamics testing data were instrumental in containment
evaluation, and WellWatcher™ permanent monitoring systems were
deployed. For the injection test, SLB designed and executed CO2
pumping and delivered integrated services for coiled tubing,
surface testing, and cased-hole wireline logging. The Pulsar™
multifunction spectroscopy service was employed for near-wellbore
CO2 monitoring. Before and after CO2 injection, an Optiq™
fiber-optic solutions workflow was used for temperature and
acoustic monitoring.
FINANCIAL TABLES
Condensed Consolidated Statement of Income
(Stated in millions, except per
share amounts)
Fourth Quarter
Twelve Months
Periods Ended December 31,
2023
2022
2023
2022
Revenue
$8,990
$7,879
$33,135
$28,091
Interest & other income (1)
95
174
342
610
Expenses
Cost of revenue (1)
7,194
6,308
26,572
22,938
Research & engineering
187
178
711
634
General & administrative
96
99
364
376
Merger and integration (1)
45
-
45
-
Interest
130
121
503
490
Income before taxes (1)
$1,433
$1,347
$5,282
$4,271
Tax expense (1)
284
264
1,007
779
Net income (1)
$1,149
$1,083
$4,275
$3,492
Net income attributable to noncontrolling
interests (1)
36
18
72
51
Net income attributable to SLB (1)
$1,113
$1,065
$4,203
$3,441
Diluted earnings per share of SLB (1)
$0.77
$0.74
$2.91
$2.39
Average shares outstanding
1,429
1,420
1,425
1,416
Average shares outstanding assuming
dilution
1,446
1,442
1,443
1,437
Depreciation & amortization included
in expenses (2)
$609
$549
$2,312
$2,147
(1)
See section entitled “Charges &
Credits” for details.
(2)
Includes depreciation of fixed assets and
amortization of intangible assets, exploration data costs, and APS
investments.
Condensed Consolidated Balance Sheet
(Stated in millions)
Dec. 31,
Dec. 31,
Assets
2023
2022
Current Assets Cash and short-term investments
$3,989
$2,894
Receivables
7,812
6,766
Inventories
4,387
3,999
Other current assets
1,530
1,344
17,718
15,003
Investment in affiliated companies
1,624
1,581
Fixed assets
7,240
6,607
Goodwill
14,084
12,982
Intangible assets
3,239
2,992
Other assets
4,052
3,970
$47,957
$43,135
Liabilities and Equity Current Liabilities Accounts payable
and accrued liabilities
$10,904
$9,121
Estimated liability for taxes on income
994
1,002
Short-term borrowings and current portion of long-term debt
1,123
1,632
Dividends payable
374
263
13,395
12,018
Long-term debt
10,842
10,594
Postretirement benefits
175
165
Other liabilities
2,186
2,369
26,598
25,146
Equity
21,359
17,989
$47,957
$43,135
Liquidity
(Stated in millions)
Components of Liquidity
Dec. 31,2023 Sept. 30,2023 Dec.
31,2022 Cash and short-term investments
$3,989
$3,735
$2,894
Short-term borrowings and current portion of long-term debt
(1,123)
(1,998)
(1,632)
Long-term debt
(10,842)
(11,147)
(10,594)
Net Debt (1)
$(7,976)
$(9,410)
$(9,332)
Details of changes in liquidity follow:
Twelve
Fourth
Twelve
Months
Quarter
Months
Periods Ended December 31,
2023
2023
2022
Net income
$4,275
$1,149
$3,492
Charges and credits, net of tax (2)
110
146
(303)
4,385
1,295
3,189
Depreciation and amortization (3)
2,312
609
2,147
Stock-based compensation expense
293
75
313
Change in working capital
(215)
1,138
(1,709)
US federal tax refund
85
85
-
Other
(223)
(180)
(220)
Cash flow from operations
6,637
3,022
3,720
Capital expenditures
(1,939)
(594)
(1,618)
APS investments
(507)
(116)
(587)
Exploration data capitalized
(153)
(32)
(97)
Free cash flow (4)
4,038
2,280
1,418
Dividends paid
(1,317)
(356)
(848)
Stock repurchase program
(694)
(100)
-
Proceeds from employee stock plans
281
5
222
Business acquisitions and investments, net of cash acquired
(330)
(50)
(58)
Proceeds from sale of Liberty shares
137
-
732
Proceeds from sale of ADC shares
-
-
223
Proceeds from sale of real estate
-
-
120
Purchases of Blue Chip Swap securities
(185)
(16)
(259)
Proceeds from sale of Blue Chip Swap securities
97
6
111
Taxes paid on net settled stock-based compensation awards
(169)
(7)
(93)
Other
(195)
(1)
(105)
Decrease in net debt before impact of changes in foreign
exchange rates
1,663
1,761
1,463
Impact of changes in foreign exchange rates on net debt
(307)
(327)
261
Decrease in Net Debt
1,356
1,434
1,724
Net Debt, beginning of period
(9,332)
(9,410)
(11,056)
Net Debt, end of period
$(7,976)
$(7,976)
$(9,332)
(1)
“Net Debt” represents gross debt less cash
and short-term investments. Management believes that Net Debt
provides useful information to investors and management regarding
the level of SLB’s indebtedness by reflecting cash and investments
that could be used to repay debt. Net Debt is a non-GAAP financial
measure that should be considered in addition to, not as a
substitute for or superior to, total debt.
(2)
See section entitled “Charges &
Credits” for details.
(3)
Includes depreciation of fixed assets and
amortization of intangible assets, exploration data costs, and APS
investments.
(4)
“Free cash flow” represents cash flow from
operations less capital expenditures, APS investments, and
exploration data costs capitalized. Management believes that free
cash flow is an important liquidity measure for the company and
that it is useful to investors and management as a measure of SLB’s
ability to generate cash. Once business needs and obligations are
met, this cash can be used to reinvest in the company for future
growth or to return to shareholders through dividend payments or
share repurchases. Free cash flow does not represent the residual
cash flow available for discretionary expenditures. Free cash flow
is a non-GAAP financial measure that should be considered in
addition to, not as a substitute for or superior to, cash flow from
operations.
Charges & Credits
In addition to financial results determined in accordance with
US generally accepted accounting principles (GAAP), this
fourth-quarter 2023 earnings release also includes non-GAAP
financial measures (as defined under the SEC’s Regulation G). In
addition to the non-GAAP financial measures discussed under
“Liquidity”, SLB net income, excluding charges & credits, as
well as measures derived from it (including diluted EPS, excluding
charges & credits; effective tax rate, excluding charges &
credits; adjusted EBITDA and adjusted EBITDA margin) are non-GAAP
financial measures. Management believes that the exclusion of
charges & credits from these financial measures provides useful
perspective on SLB’s underlying business results and operating
trends, and a means to evaluate SLB’s operations period over
period. These measures are also used by management as performance
measures in determining certain incentive compensation. The
foregoing non-GAAP financial measures should be considered in
addition to, not as a substitute for or superior to, other measures
of financial performance prepared in accordance with GAAP. The
following is a reconciliation of certain of these non-GAAP measures
to the comparable GAAP measures. For a reconciliation of adjusted
EBITDA to the comparable GAAP measure, please refer to the section
titled “Supplementary Information” (Question 10).
(Stated in millions, except per
share amounts)
Fourth Quarter 2023 Pretax Tax Noncont.Interests Net
DilutedEPS SLB net income (GAAP basis)
$1,433
$284
$36
$1,113
$0.77
Merger & integration (1)
56
8
8
40
0.03
Argentina devaluation (2)
90
-
-
90
0.06
SLB net income, excluding charges & credits
$1,579
$292
$44
$1,243
$0.86
Fourth Quarter 2022 Pretax Tax
Noncont.Interests Net DilutedEPS SLB net income (GAAP basis)
$1,347
$264
$18
$1,065
$0.74
Gain on ADC equity investment
(107)
(3)
-
(104)
(0.07)
Gain on sale of Liberty shares
(84)
(19)
-
(65)
(0.05)
Gain on repurchase of bonds
(11)
(2)
-
(9)
(0.01)
Loss on Blue Chip Swap transactions
139
-
-
139
0.10
SLB net income, excluding charges & credits
$1,284
$240
$18
$1,026
$0.71
(Stated in millions, except per
share amounts)
Twelve Months 2023 Pretax Tax Noncont.Interests Net
DilutedEPS SLB net income (GAAP basis)
$5,282
$1,007
$72
$4,203
$2.91
Fourth Quarter Merger & integration (1)
56
8
8
40
0.03
Argentina devaluation (2)
90
-
-
90
0.06
First Quarter Gain on sale of Liberty shares (3)
(36)
(8)
-
(28)
(0.02)
SLB net income, excluding charges & credits
$5,392
$1,007
$80
$4,305
$2.98
Twelve Months 2022 Pretax Tax
Noncont.Interests Net DilutedEPS * SLB net income (GAAP basis)
$4,271
$779
$51
$3,441
$2.39
Fourth Quarter Gain on ADC equity investment
(107)
(3)
-
(104)
(0.07)
Gain on sale of Liberty shares
(84)
(19)
-
(65)
(0.05)
Gain on repurchase of bonds
(11)
(2)
-
(9)
(0.01)
Loss on Blue Chip Swap transactions
139
-
-
139
0.10
Second Quarter Gain on sale of Liberty shares
(215)
(14)
-
(201)
(0.14)
Gain on sale of certain real estate
(43)
(2)
-
(41)
(0.03)
First Quarter Gain on sale of Liberty shares
(26)
(4)
-
(22)
(0.02)
SLB net income, excluding charges & credits
$3,924
$735
$51
$3,138
$2.18
(1)
$45 million of these charges were
classified in Merger & integration in the Condensed
Consolidated Statement of Income with the remaining $11 million
classified in Cost of revenue.
(2)
Classified in Cost of revenue in the
Condensed Consolidated Statement of income.
(3)
Classified in Interest & other income
in the Condensed Consolidated Statement of income.
There were no charges or credits during the third quarter of
2023.
All Charges & Credits for the full year 2022 are classified
in Interest & other income in the Condensed Consolidated
Statement of Income.
* Does not add due to rounding.
Divisions
(Stated in millions)
Three Months Ended Dec. 31,
2023 Sept. 30, 2023 Dec. 31, 2022
Revenue
IncomeBeforeTaxes Revenue IncomeBeforeTaxes Revenue
IncomeBeforeTaxes Digital & Integration
$1,049
$356
$982
$314
$1,012
$382
Reservoir Performance
1,735
371
1,680
344
1,554
282
Well Construction
3,426
770
3,430
759
3,229
679
Production Systems
2,944
442
2,367
319
2,215
238
Eliminations & other
(164)
(71)
(149)
(53)
(131)
(24)
Pretax segment operating income
1,868
1,683
1,557
Corporate & other
(193)
(182)
(169)
Interest income(1)
30
20
14
Interest expense(1)
(126)
(126)
(118)
Charges & credits(2)
(146)
-
63
$8,990
$1,433
$8,310
$1,395
$7,879
$1,347
(Stated in millions)
Full Year 2023 Revenue IncomeBeforeTaxes
Depreciation and Amortization (3) Net
InterestExpense(Income) (4) AdjustedEBITDA (5)
CapitalInvestments (6) Digital & Integration
$3,871
$1,257
$578
$12
$1,847
$660
Reservoir Performance
6,561
1,263
387
(4)
1,646
514
Well Construction
13,478
2,932
587
(5)
3,514
908
Production Systems
9,831
1,245
325
(1)
1,569
384
Eliminations & other
(606)
(174)
277
(1)
102
133
6,523
2,154
1
8,678
2,599
Corporate & other
(729)
158
(571)
Interest income (1)
87
Interest expense (1)
(489)
Charges & credits (2)
(110)
$33,135
$5,282
$2,312
$1
$8,107
$2,599
(Stated in millions)
Full Year 2022 Revenue IncomeBeforeTaxes
Depreciation and Amortization (3) Net
InterestExpense(Income) (4) AdjustedEBITDA (5)
CapitalInvestments (6) Digital & Integration
$3,725
$1,357
$504
$11
$1,872
$689
Reservoir Performance
5,553
881
386
(34)
1,233
478
Well Construction
11,397
2,202
524
(25)
2,701
687
Production Systems
7,862
748
311
(11)
1,047
346
Eliminations & other
(446)
(177)
271
(1)
95
102
5,011
1,996
(60)
6,948
2,302
Corporate & other
(637)
151
(486)
Interest income (1)
27
Interest expense (1)
(477)
Charges & credits (2)
347
$28,091
$4,271
$2,147
$(60)
$6,462
$2,302
(1)
Excludes amounts which are included in the
segments’ results.
(2)
See section entitled “Charges &
Credits” for details.
(3)
Includes depreciation of fixed assets and
amortization of intangible assets, APS and exploration data
costs.
(4)
Excludes interest income and interest
expense recorded at the corporate level.
(5)
Adjusted EBITDA represents income before
taxes excluding depreciation and amortization, interest income,
interest expense and charges & credits.
(6)
Capital investments includes capital
expenditures, APS investments, and exploration data costs
capitalized.
Geographical
(Stated in millions)
Full Year 2023 Revenue IncomeBefore Taxes
Depreciation and Amortization (3) Net
InterestExpense(Income) (4) AdjustedEBITDA (5)
International
$26,188
$5,486
$1,513
($11)
$6,988
North America
6,727
1,157
389
13
1,559
Eliminations & other
220
(120)
252
(1)
131
6,523
2,154
1
8,678
Corporate & other
(729)
158
(571)
Interest income (1)
87
Interest expense (1)
(489)
Charges & credits (2)
(110)
$33,135
$5,282
$2,312
$1
$8,107
Full Year 2022 Revenue IncomeBefore
Taxes Depreciation and Amortization (3) Net
InterestExpense(Income) (4) AdjustedEBITDA (5)
International
$21,895
$4,063
$1,433
($71)
$5,425
North America
5,995
1,106
353
12
1,470
Eliminations & other
201
(158)
210
(1)
53
5,011
1,996
(60)
6,948
Corporate & other
(637)
151
(486)
Interest income (1)
27
Interest expense (1)
(477)
Charges & credits (2)
347
$28,091
$4,271
$2,147
$(60)
$6,462
(1)
Excludes amounts which are included in the
segments’ results.
(2)
See section entitled “Charges &
Credits” for details.
(3)
Includes depreciation of fixed assets and
amortization of intangible assets, APS and exploration data
costs.
(4)
Excludes interest income and interest
expense recorded at the corporate level.
(5)
Adjusted EBITDA represents income before
taxes excluding depreciation and amortization, interest income,
interest expense and charges & credits.
Supplementary Information Frequently Asked
Questions
1)
What is the capital investment guidance for the full-year
2024?
Capital investment (consisting of capex,
exploration data costs, and APS investments) for the full-year 2024
is expected to be approximately $2.6 billion, which is the same
level as the full-year 2023.
2)
What were cash flow from
operations and free cash flow for the fourth quarter of
2023?
Cash flow from operations
for the fourth quarter of 2023 was $3.02 billion and free cash flow
was $2.28 billion.
3)
What were cash flow from
operations and free cash flow for the full year 2023?
Cash flow from operations for the
full year 2023 was $6.64 billion and free cash flow was $4.04
billion.
4)
What was included in “Interest
& other income” for the fourth quarter of 2023?
“Interest & other income” for
the fourth quarter of 2023 was $95 million. This consisted of
interest income of $41 million and earnings of equity method
investments of $54 million.
5)
How did interest income and
interest expense change during the fourth quarter of 2023?
Interest income of $41 million
for the fourth quarter of 2023 increased $20 million sequentially.
Interest expense of $130 million increased $1 million
sequentially.
6)
What is the difference between
SLB’s consolidated income before taxes and pretax segment operating
income?
The difference consists of
corporate items, charges and credits, and interest income and
interest expense not allocated to the segments, as well as
stock-based compensation expense, amortization expense associated
with certain intangible assets, certain centrally managed
initiatives, and other nonoperating items.
7)
What was the effective tax
rate (ETR) for the fourth quarter of 2023?
The ETR for the fourth quarter of
2023, calculated in accordance with GAAP, was 19.9% as compared to
18.6% for the third quarter of 2023. Excluding charges and credits,
the ETR for the fourth quarter of 2023 was 18.5%. There were no
charges or credits during the third quarter of 2023.
8)
How many shares of common
stock were outstanding as of December 31, 2023, and how did this
change from the end of the previous quarter?
There were 1.427 billion shares
of common stock outstanding as of December 31, 2023, and 1.423
billion shares outstanding as of September 30, 2023.
(Stated in millions)
Shares outstanding at September 30, 2023
1,423
Shares issued under employee stock purchase
plan
-
Shares issued to optionees, less shares
exchanged
-
Vesting of restricted stock
1
Shares issued on acquisition of Aker subsea
5
Stock repurchase program
(2)
Shares outstanding at December 31, 2023
1,427
9)
What was the weighted average
number of shares outstanding during the fourth quarter of 2023 and
third quarter of 2023? How does this reconcile to the average
number of shares outstanding, assuming dilution, used in the
calculation of diluted earnings per share?
The weighted average number of
shares outstanding was 1.429 billion during the fourth quarter of
2023 and 1.424 billion during the third quarter of 2023. The
following is a reconciliation of the weighted average shares
outstanding to the average number of shares outstanding, assuming
dilution, used in the calculation of diluted earnings per
share.
(Stated in millions)
Fourth Quarter 2023 Third Quarter 2023
Weighted average shares outstanding
1,429
1,424
Unvested restricted stock
16
16
Assumed exercise of stock options
1
2
Average shares outstanding, assuming dilution
1,446
1,442
10)
What was SLB’s adjusted EBITDA
in the fourth quarter of 2023, the third quarter of 2023, the
fourth quarter of 2022, the full-year 2023, and the full-year
2022?
SLB’s adjusted EBITDA was $2.277
billion in the fourth quarter of 2023, $2.081 billion in the third
quarter of 2023, and $1.921 billion in the fourth quarter of 2022,
and was calculated as follows:
(Stated in millions)
Fourth Quarter2023 Third Quarter2023 Fourth Quarter2022
Net income attributable to SLB
$1,113
$1,123
$1,065
Net income attributable to noncontrolling
interests
36
13
18
Tax expense
284
259
264
Income before taxes
$1,433
$1,395
$1,347
Charges & credits
146
-
(63)
Depreciation and amortization
609
579
549
Interest expense
130
129
121
Interest income
(41)
(22)
(33)
Adjusted EBITDA
$2,277
$2,081
$1,921
SLB’s adjusted EBITDA was $8.107 billion
in the full-year 2023 and $6.462 billion for the full-year 2022,
and was calculated as follows:
(Stated in millions)
TwelveMonths 2023 TwelveMonths 2022
Net income attributable to SLB
$4,203
$3,441
Net income attributable to noncontrolling
interests
72
51
Tax expense
1,007
779
Income before taxes
$5,282
$4,271
Charges & credits
110
(347)
Depreciation and amortization
2,312
2,147
Interest expense
503
490
Interest income
(100)
(99)
Adjusted EBITDA
$8,107
$6,462
Adjusted EBITDA represents income before
taxes, excluding charges & credits, depreciation and
amortization, interest expense, and interest income. Management
believes that adjusted EBITDA is an important profitability measure
for SLB and that it provides useful perspective on SLB’s underlying
business results and operating trends, and a means to evaluate
SLB’s operations period over period. Adjusted EBITDA is also used
by management as a performance measure in determining certain
incentive compensation. Adjusted EBITDA should be considered in
addition to, not as a substitute for or superior to, other measures
of financial performance prepared in accordance with GAAP.
11)
What were the components of
depreciation and amortization expense for the fourth quarter of
2023, the third quarter of 2023, and the fourth quarter of
2022?
The components of depreciation
and amortization expense for the fourth quarter of 2023, the third
quarter of 2023, and the fourth quarter of 2022 were as
follows:
(Stated in millions)
Fourth Quarter2023 Third Quarter2023 Fourth Quarter2022
Depreciation of fixed assets
$380
$365
$347
Amortization of intangible assets
83
78
75
Amortization of APS investments
111
107
102
Amortization of exploration data costs
capitalized
35
29
25
$609
$579
$549
12)
What Divisions comprise SLB’s
Core business and what was their revenue and pretax operating
income for the full-year 2023 and full-year 2022?
SLB’s Core business comprises the
Reservoir Performance, Well Construction, and Production Systems
Divisions. SLB’s Core business revenue and pretax operating income
for the full-year 2023 and full-year 2022 are calculated as
follows:
Twelve Months Ended
Dec. 31,2023 Dec. 31,2022 Change
Revenue
Reservoir Performance
$6,561
$5,553
Well Construction
13,478
11,397
Production Systems
9,831
7,862
$29,870
$24,812
20%
Pretax
Operating Income Reservoir Performance
$1,263
$881
Well Construction
2,932
2,202
Production Systems
1,245
748
$5,440
$3,831
42%
Pretax
Operating Margin Reservoir Performance
19.2%
15.9%
Well Construction
21.8%
19.3%
Production Systems
12.7%
9.5%
18.2%
15.4%
277 bps 13)
How does SLB calculate ROCE
(return on capital employed)?
SLB calculates ROCE as a ratio,
the numerator of which is (a) net income, excluding charges and
credits plus (b) after tax net interest expense, and the
denominator of which is (x) stockholders’ equity, including
non-controlling interests (average of beginning and end of each
quarter in the year), plus (y) net debt (average of beginning and
end of each quarter in the year). ROCE is a measure of the
efficiency of our capital employed and is a comprehensive indicator
of long-term company and management performance.
About SLB
SLB (NYSE: SLB) is a global technology company driving energy
innovation for a balanced planet. With a global presence in more
than 100 countries and employees representing almost twice as many
nationalities, we work each day on innovating oil and gas,
delivering digital at scale, decarbonizing industries, and
developing and scaling new energy systems that accelerate the
energy transition. Find out more at slb.com.
Conference Call Information
SLB will hold a conference call to discuss the earnings press
release and business outlook on Friday, January 19, 2024. The call
is scheduled to begin at 9:30 a.m. US Eastern Time. To access the
call, which is open to the public, please contact the conference
call operator at +1 (844) 721-7241 within North America, or +1
(409) 207-6955 outside North America, approximately 10 minutes
prior to the call’s scheduled start time, and provide the access
code 8858313. At the conclusion of the conference call, an audio
replay will be available until February 19, 2024, by dialing +1
(866) 207-1041 within North America, or +1 (402) 970-0847 outside
North America, and providing the access code 8122009. The
conference call will be webcast simultaneously at
www.slb.com/irwebcast on a listen-only basis. A replay of the
webcast will also be available at the same website until February
19, 2024.
This fourth-quarter and full-year 2023 earnings press release,
as well as other statements we make, contain “forward-looking
statements” within the meaning of the federal securities laws,
which include any statements that are not historical facts. Such
statements often contain words such as “expect,” “may,” “can,”
“believe,” “predict,” “plan,” “potential,” “projected,”
“projections,” “precursor,” “forecast,” “outlook,” “expectations,”
“estimate,” “intend,” “anticipate,” “ambition,” “goal,” “target,”
“scheduled,” “think,” “should,” “could,” “would,” “will,” “see,”
“likely,” and other similar words. Forward-looking statements
address matters that are, to varying degrees, uncertain, such as
statements about our financial and performance targets and other
forecasts or expectations regarding, or dependent on, our business
outlook; growth for SLB as a whole and for each of its Divisions
(and for specified business lines, geographic areas, or
technologies within each Division); oil and natural gas demand and
production growth; oil and natural gas prices; forecasts or
expectations regarding energy transition and global climate change;
improvements in operating procedures and technology; capital
expenditures by SLB and the oil and gas industry; our business
strategies, including digital and “fit for basin,” as well as the
strategies of our customers; our capital allocation plans,
including dividend plans and share repurchase programs; our APS
projects, joint ventures, and other alliances; the impact of the
ongoing conflict in Ukraine on global energy supply; access to raw
materials; future global economic and geopolitical conditions;
future liquidity, including free cash flow; and future results of
operations, such as margin levels. These statements are subject to
risks and uncertainties, including, but not limited to, changing
global economic and geopolitical conditions; changes in exploration
and production spending by our customers, and changes in the level
of oil and natural gas exploration and development; the results of
operations and financial condition of our customers and suppliers;
the inability to achieve our financial and performance targets and
other forecasts and expectations; the inability to achieve our
net-zero carbon emissions goals or interim emissions reduction
goals; general economic, geopolitical, and business conditions in
key regions of the world; the ongoing conflict in Ukraine; foreign
currency risk; inflation; changes in monetary policy by
governments; pricing pressure; weather and seasonal factors;
unfavorable effects of health pandemics; availability and cost of
raw materials; operational modifications, delays, or cancellations;
challenges in our supply chain; production declines; the extent of
future charges; the inability to recognize efficiencies and other
intended benefits from our business strategies and initiatives,
such as digital or new energy, as well as our cost reduction
strategies; changes in government regulations and regulatory
requirements, including those related to offshore oil and gas
exploration, radioactive sources, explosives, chemicals, and
climate-related initiatives; the inability of technology to meet
new challenges in exploration; the competitiveness of alternative
energy sources or product substitutes; and other risks and
uncertainties detailed in this press release and our most recent
Forms 10-K, 10-Q, and 8-K filed with or furnished to the Securities
and Exchange Commission. If one or more of these or other risks or
uncertainties materialize (or the consequences of any such
development changes), or should our underlying assumptions prove
incorrect, actual results or outcomes may vary materially from
those reflected in our forward-looking statements. Forward-looking
and other statements in this press release regarding our
environmental, social, and other sustainability plans and goals are
not an indication that these statements are necessarily material to
investors or required to be disclosed in our filings with the SEC.
In addition, historical, current, and forward-looking
environmental, social, and sustainability-related statements may be
based on standards for measuring progress that are still
developing, internal controls and processes that continue to
evolve, and assumptions that are subject to change in the future.
Statements in this press release are made as of the date of this
release, and SLB disclaims any intention or obligation to update
publicly or revise such statements, whether as a result of new
information, future events, or otherwise.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240117479536/en/
Investors James R. McDonald – SVP, Investor Relations
& Industry Affairs, SLB Joy V. Domingo – Director of Investor
Relations, SLB Tel: +1 (713) 375-3535 Email:
investor-relations@slb.com
Media Josh Byerly – Vice President of Communications, SLB
Moira Duff – Director of External Communications, SLB Tel: +1 (713)
375-3407 Email: media@slb.com
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