Schlumberger is the world’s leading provider of technology for reservoir characterization, drilling, production and processing to the oil and gas industry. Schlumberger supplies products and services, from exploration through production, and integrated pore-to-pipeline solutions that optimize hydrocarbon recovery to deliver reservoir performance sustainably. In 2019, the company employed approximately 105,000 over 170 nationalities and generates revenue in more than 120 countries.
Schlumberger operates in four segments: Reservoir Characterization, Drilling, Production and Cameron.
Reservoir Characterization consists of the principal Technologies involved in finding and defining hydrocarbon resources. Drilling consists of the principal Technologies involved in the drilling and positioning of oil and gas wells. Production consists of the principal Technologies involved in the lifetime production of oil and gas reservoirs. Cameron consists of the principal Technologies involved in pressure and flow control for drilling and intervention rigs, oil and gas wells and production facilities.
According to the company´s Annual Report, Schlumberger full-year 2019 revenue of $32.9 billion was essentially flat compared with $32.8 billion in 2018, and increased by 8% in 2018, compared to $30.4 billion in 2017. Schlumberger's financial performance in 2019 was primarily driven by the international markets. International revenue grew by 7%, from $20.4 billion in 2018 to 21.8 billion in 2019. Internationally, activity and investment continued to strengthen, particularly offshore. This strong international performance was the result of increased activity on the part of operators as they continued to invest in longer-term resource development.
In contrast, after two years of strong growth, North American revenue fell sharply by 10% to $10.8 billion compared to $12 billion in 2018.
North America results reflect a slowing production growth rate on land as operators reduced drilling and hydraulic fracturing activity. This decrease was also driven by the land market weakness affecting the OneStim pressure pumping business. Additionally, Schlumberger completed the formation of the Sensia joint venture and the divestiture of the Drilling Tools business in 2019. Together these two transactions resulted in net cash proceeds of $586 million.
In 2019 the company generated full-year 2018 net loss of $10.1 billion, compared with pre-tax income of $2.1 billion in 2018.
The operating pre-tax income of the company amounted for $3.97 billion in 2019 compared to $4.6 billion in 2018.
Segmentally, Reservoir Characterization full-year 2019 revenue reached $6.3 billion and increased 2% year-on-year compared to $6.5 billion in 2018 and was driven by increased international activity. Pre-tax operating margin decreased to 21% in 2019.
In the Drilling segment, full-year 2019 revenue of $9.7 billion increased by 5% compared to $9.3 billion in the prior year due to higher demand for drilling services, largely in the international markets. Pre-tax operating margin decreased to 13% despite higher revenue as margins were affected by competitive pricing and higher costs associated with a number of integrated contracts internationally.
The Production segment achieved full-year 2019 revenue of $12.0 billion and decreased by 3% from $12.4 billion in 2018. The revenue decline was attributable to lower OneStim activity in North America as customers reduced spending due to higher cost of capital. Pre-tax operating margin decreased to 8%, primarily due to reduced profitability in OneStim in North America.
The Cameron segment showed full-year 2019 revenue of $5.3 billion and decreased by 3% from $$5.2 billion due to lower revenue for OneSubsea and Valves & Process Systems. Pre-tax operating margin decreased from 12% in 2018 to 11% in 2019.
Research & engineering expenses, as a percentage of Revenue, were 2.17% or $717 million in 2019, compared to 2.1% or $702 million in 2018 and 2.6% or $787 million in 2017.
Schlumberger had total Cash and Short-term investments of $2.2 billion, $2.8 billion and $5.1 billion in 2019, 2018 and 2017, respectively. Total debt was $15.3 billion, $16.1 billion and $18.2 billion in 2019, 2018 and 2017, respectively.
Cash flow from operations was $5.4 billion in 2019, and $5.7 billion in 2018 as well as in 2017.
Dividends paid during 2019 were $2.8 billion. The same dividends were paid in 2018, 2017 and 2016.
In 2020 Schlumberger expects its international portfolio revenue to grow at the same pace or even higher, excluding the effects of the businesses transferred to the Sensia joint venture and the businesses divested in the Drilling Tools transaction. International revenue growth will be present with increasing offshore activity, improving activity mix from the early deepwater growth cycle, and increasing exploration work toward the end of the year and into 2021. In 2020 Schlumberger also expects to promote margin expansion and the improvement of returns in the North America land market.