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HOUSTON – Oil field giant Schlumberger said Thursday it will cut approximately 9,000 employees – around 7.5 percent of its workforce around the globe – as both petroleum prices and oil-company spending nosedive.
Schlumberger’s profits fell 82 percent in the fourth quarter as it wrote down $1.7 billion in assets. It said it recorded a $296 million charge related to its headcount reduction.
The oil-tool maker banked $302 million, or 23 cents a share, in net income in the October-December period, compared to $1.66 billion, or $1.26 a share, in the same period in 2013. Its revenues were up from $11.9 billion to $12.6 billion.
The job reductions began in the fourth quarter and are expected to be completed later this year, Schlumberger spokesman Stephen Harris said in an email.
“These global reductions encompass many geographic regions in which we operate, including the Houston area,” Harris said. The company is “not releasing any details on exactly how many and where these reductions are coming from, however.”
The company took an $800 million impairment charge when it retired some of the seismic vessels from its fleet. Schlumberger also took a $472 million devaluation charge on the devaluation of Venezuela’s currency against the U.S. dollar. And it saw $199 million impairment charge as the value of an investment in the Eagle Ford Shale sunk.
Traders reversed a large portion of Wednesday’s rally in crude oil. Futures for international Brent crude fell $1.02 to $47.67 per barrel on London’s ICE Futures Europe market. U.S. benchmark West Texas Intermediate fell $2.23 to $46.25 a barrel on the New York Mercantile Exchange.
Schlumberger’s profits fell 82 percent in the fourth quarter as it wrote down $1.7 billion in assets. It said it recorded a $296 million charge related to its headcount reduction.
Robert Drummond, President of Schlumberger North America (left) and Jeremy Aumaugher, South Division Operations Manager (Tom Reel/ San Antonio Express-News)
“It’s very unfortunate, but this is definitely not going to be the last headcount reduction in 2015 in the energy space,” said Rob Desai, an analyst with Edward Jones. “The goal is to position the company to come out of this downturn stronger.”
The oil-tool maker banked $302 million, or 23 cents a share, in net income in the October-December period, compared to $1.66 billion, or $1.26 a share, in the same period in 2013. Its revenues were up from $11.9 billion to $12.6 billion.
The job reductions began in the fourth quarter and are expected to be completed later this year, Schlumberger spokesman Stephen Harris said in an email.
The company took an $800 million impairment charge when it retired some of the seismic vessels from its fleet. Schlumberger also took a $472 million devaluation charge on the devaluation of Venezuela’s currency against the U.S. dollar. And it saw $199 million impairment charge as the value of an investment in the Eagle Ford Shale sunk.
Traders reversed a large portion of Wednesday’s rally in crude oil. Futures for international Brent crude fell $1.02 to $47.67 per barrel on London’s ICE Futures Europe market. U.S. benchmark West Texas Intermediate fell $2.23 to $46.25 a barrel on the New York Mercantile Exchange.
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