National Oilwell Varco Inc. (NYSE: NOV) reported first-quarter 2013 results before markets opened this morning. The oil field services and drill rig technology firm posted adjusted diluted earnings per share (EPS) of $1.29 on revenues of $5.31 billion. In the same period a year ago, the company reported EPS of $1.44 on revenues of $4.3 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $1.36 and $5.38 billion in revenues.
On a GAAP basis, Varco reported quarterly EPS of $1.17, which excludes costs associated with an acquisition and charges related to Venezuela’s currency devaluation totaling $73 million.
Varco did not offer guidance in its press announcement, but the consensus estimate for the second quarter calls for EPS of $1.44 on revenues of $5.6 billion, and for the full-year the EPS and revenues estimates are $5.96 and $22.81 billion, respectively.
At the end of the fourth quarter, the consensus estimate called for first quarter EPS of $1.50, and Varco could not manage even to clear that lowered bar. The revenue estimates at the same time was $5.46 billion, which was also lowered and also missed.
The company’s CEO said:
The North American market was softer than anticipated … As we move through the year, we expect to see continued improvements in international activity, strong industry demand for both floaters and jackups, and a heightened level of interest and orders in our floating production equipment offering. Additionally, while we are cautious regarding the timing of a North America recovery, we remain confident that land drillers and well service firms will soon consume their current inventories, ultimately requiring more of our products and services. Until that time, we take comfort in knowing that we are well positioned for this market, given our strong financial resources, unparalleled market presence, exceptional backlog, and extraordinary workforce.
Varco did increase its backlog during the first quarter, from $11.86 billion at the end of the fourth quarter to $12.92 billion, a record high.
Revenue fell sequentially in each of the company’s three segments, with the largest drop — 9% — in the firm’s rig technology segment. Year-over-year rig technology rose 16%.
Varco’s shares rose 0.4% in after-hours trading last night to $67.49. Shares are inactive this morning. The stock’s 52-week range is $59.07 to $89.95. Thomson Reuters had a consensus analyst price target of around $85.40 before today’s report.