Schlumberger Announces Third Quarter 2004 Results

Schlumberger Limited (NYSE:SLB) reported third-quarter 2004 operating revenue of $2.93 billion versus $2.86 billion in the second quarter of 2004 and $2.54 billion in the third quarter of 2003. Income from continuing operations before charges was $310 million, or $0.52 per share-diluted versus $0.48 in the second quarter of 2004 and $0.36 in the third quarter of last year. Including charges, income from continuing operations was $297 million, or $0.50 per share, compared to a loss of $88 million, or $0.15 per share, last year.

Discontinued operations recorded a gain of $21 million ($0.03 per share) in the quarter. This resulted in a net income of $318 million, or $0.53 per share-diluted, compared to a net loss of $55 million, or $0.09 per share, last year.

Oilfield Services revenue of $2.61 billion increased 3% sequentially and 16% compared to the same quarter of last year. Pretax business segment operating income of $440 million decreased 3% sequentially but grew 10% year-on-year.

WesternGeco revenue of $301 million increased 3% sequentially and 14% year-on-year. Pretax business segment operating income of $33 million improved $19 million sequentially and $70 million compared to the same quarter of last year.

Schlumberger Chairman and CEO Andrew Gould commented, "Solid underlying progress in the third quarter was somewhat undermined by a series of unfavorable events which all adversely affected sequential results. These included hurricanes in the Gulf of Mexico, a slowdown in drilling activity in Mexico, losses on two drilling projects, the partial stoppage of certain barges in Venezuela, and the cost of redeploying equipment from YUKOS to other customers. Pricing in North America showed good improvement, and overall activity trends remained very positive particularly in the Eastern Hemisphere. New technology revenue from Wireline was particularly impressive in the quarter with several new services beginning to make revenue contributions.

WesternGeco had an excellent quarter with pretax operating income approaching the levels we set as an objective 18 months ago. Very strong Q activity and Multiclient sales contributed to this success. Based on continued growth in demand, we are converting a fifth vessel to Q technology.

Our activity outlook for the coming quarters remains very positive as the fundamentals of supply and demand remain strongly biased towards high oil prices."

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