National Oilwell Touts $2.94B in 2Q Revenues

National Oilwell reported that for its second quarter ended June 30, 2010 it earned net income of $401 million, or $0.96 per fully diluted share. Earnings per share increased 81 percent compared to the second quarter of 2009, when the Company earned $0.53 per share. Earnings per share decreased five percent compared to first quarter 2010 earnings of $1.01 per share. Excluding transaction charges of $4 million pre-tax or $0.01 per share after-tax, second quarter 2010 net income was $405 million, or $0.97 per fully diluted share.

The Company's revenues for the second quarter of 2010 were $2.94 billion, down slightly from both the prior quarter and prior year quarter, as higher sales in both Petroleum Services & Supplies and Distribution Services segments, and rising Rig Technology aftermarket sales, did not completely offset lower offshore rig fabrication revenue out of backlog in the Rig Technology segment. Operating profit for the second quarter of 2010 was $594 million or 20.2 percent of sales, compared to 19.6 percent in the second quarter of 2009 and 21.4 percent in the first quarter of 2010, excluding transaction and restructuring charges from all periods. Year-over-year second quarter operating profit increased $5 million despite a $69 million decline in revenue, excluding transaction and restructuring charges. Sequentially, second quarter operating profit declined $54 million on $91 million lower revenue, resulting in operating profit flow-through (change in operating profit divided by the change in revenue) of 59 percent, excluding transaction and restructuring charges.

During the second quarter of 2010 the Company's Rig Technology segment booked $689 million in new orders, partially offset by cancellations and change orders of $29 million, resulting in net order additions to backlog of $660 million. Backlog for capital equipment orders for the Company's Rig Technology segment was $4.9 billion at June 30, 2010, down 11 percent from March 31, 2010.

Pete Miller, Chairman, President and CEO of National Oilwell Varco, remarked, "Our Company achieved solid earnings this quarter, thanks to the hard work of our dedicated employees, who provide great service, quality products, and remarkable technology to the oil and gas industry worldwide, every day. Strategically we continue to position our organization to bridge this industry's transition to new and exciting frontiers - namely, the development of unconventional resources across many continents, the production of new deepwater resources, and the application of new and better technology to make our business safer, more efficient, and more environmentally sound.

The Company continues to expand organically and pursue promising acquisition opportunities, underpinned by its substantial financial resources, compelling technology portfolio, and outstanding team of professionals. Perhaps most importantly at this time, our thoughts and prayers are with the many lives touched by the tragedy in the Gulf of Mexico."

Rig Technology

Second quarter revenues for the Rig Technology segment were $1.7 billion, a decrease of 11 percent from the first quarter of 2010 and a decrease of 13 percent from the second quarter of 2009. Operating profit for this segment was $509 million, or 30.4 percent of sales. Operating profit flow-through from the first quarter of 2010 to the second quarter of 2010 was 34 percent, and operating profit flow-through from the second quarter of 2009 to the second quarter of 2010 was 11 percent. Revenue out of backlog for the segment decreased 17 percent sequentially and decreased 13 percent year-over-year, to $1.3 billion for the second quarter of 2010. Non-backlog revenue improved 10 percent sequentially, led by higher sales of aftermarket parts for the segment.

Petroleum Services & Supplies

Revenues for the second quarter of 2010 for the Petroleum Services & Supplies segment were $1.0 billion, up 12 percent compared to first quarter 2010 results and up 13 percent from the second quarter of 2009. Operating profit was $138 million, or 13.4 percent of revenue, an increase of 22 percent from the first quarter of 2010 and an increase of 44 percent from the second quarter of 2009. Operating profit flow-through was 23 percent from the first quarter of 2010 to the second quarter of 2010. Operating profit flow-through from the second quarter of 2009 to the second quarter of 2010 was up 35 percent. Sharply higher sequential sales in the U.S. and modest growth in international markets easily overcame lower second quarter seasonal declines in Canada.

Distribution Services

The Distribution Services segment generated second quarter revenues of $365 million, which were up 9 percent from the first quarter of 2010 and were up 20 percent from the second quarter of 2009. Second quarter operating profit was $13 million or 3.6 percent of sales. Operating profit flow-through was up 6 percent sequentially and up 5 percent from the prior year. Strong sequential gains in U.S. operations on higher rig counts and Gulf cleanup efforts were partially offset by seasonal declines in Canada. International and industrial product sales were up modestly.

Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE


Most Popular Articles


From the Career Center
Jobs that may interest you
Location Manager I - Saybolt
Expertise: Business Development|Facilities Management|Surveying
Location: Texas City, TX
 
Cost Engineer
Expertise: Cost Engineer
Location: Pascagoula, MS
 
Billing Manager
Expertise: Accounting|Bookkeeper
Location: Houston, TX
 
search for more jobs

Brent Crude Oil : $55.86/BBL 0.73%
Light Crude Oil : $52.64/BBL 0.51%
Natural Gas : $3.42/MMBtu 0.00%
Updated in last 24 hours