National Oilwell Varco, Inc. reported that for its first quarter ended March 31, 2008 it earned net income of $397.6 million, or $1.11 per fully diluted share, compared to fourth quarter ended December 31, 2007 net income of $376.7 million, or $1.05 per fully diluted share. Earnings per share increased 42 percent compared to the first quarter of 2007, when the Company earned $275.9 million or $0.78 per fully diluted share.
Reported revenues for the first quarter were $2,685.4 million, an increase of 1 percent from the fourth quarter of 2007 and an increase of 24 percent from the first quarter of 2007. Operating profit for the quarter was $568.5 million or 21.2 percent of sales. Operating profit flow-through, or the increase in operating profit divided by the increase in revenue, was 27 percent from the first quarter of 2007 to the first quarter of 2008.
Backlog for capital equipment orders for the Company's Rig Technology segment at March 31, 2008 increased to $9.9 billion, compared to $9.0 billion at December 31, 2007, with new orders during the quarter of $2.0 billion. The increase in the Company's backlog for capital equipment reflected the strong demand for its drilling equipment products, particularly for offshore rigs.
Pete Miller, Chairman, President and CEO of National Oilwell Varco, remarked, "We are off to a good start in 2008. Our record backlog for drilling equipment continues to provide us with unprecedented visibility. We expect demand for our drilling equipment, particularly for international offshore projects, to remain strong into 2008.
We are also excited about our recently completed merger with Grant Prideco. We believe this acquisition complements our existing offering of oilfield products and services and will benefit our customers' needs. We would like to welcome the Grant Prideco employees to the National Oilwell Varco organization."
First quarter revenues for the Rig Technology segment were $1,602.9 million, an increase of 1 percent over the fourth quarter of 2007 and an increase of 31 percent from the first quarter of 2007. Operating profit for this segment was $406.0 million, or 25.3 percent of sales. Operating profit flow-through from the first quarter of 2007 to the first quarter of 2008 was 36 percent. Revenue out of backlog for the segment declined 4 percent sequentially and rose 43 percent year-over-year, to $1,131.9 million for the first quarter of 2008.
Petroleum Services & Supplies
Revenues for the first quarter of 2008 for the Petroleum Services & Supplies segment were $829.8 million, up 1.5 percent compared to fourth quarter results and up 20 percent from the first quarter of 2007. The segment benefited from strong results in international markets. Operating profit was $195.2 million, or 23.5 percent of revenue, an increase of 3 percent from the fourth quarter.
Operating profit flow-through from the fourth quarter of 2007 to the first quarter of 2008 was 49 percent, and operating profit flow-through from the first quarter of 2007 to the first quarter of 2008 was 18 percent.
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