National Oilwell Varco Turns In a Fine Quarter

Offshore drill rig
Offshore drill rig

National Oilwell Varco Inc. (NYSE: NOV) reported fourth-quarter and full-year 2012 results before markets opened this morning.

For the quarter, the oil field services and drill rig technology firm posted adjusted diluted earnings per share (EPS) of $1.49 on revenues of $5.69 billion. In the same period a year ago, the company reported EPS of $1.37 on revenues of $4.26 billion. Fourth-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $1.44 and $5.3 billion in revenues.

For the full year, the company posted adjusted EPS of $5.91 on revenues of $20.04 billion, compared with EPS of $4.77 on revenues of $14.66 billion in 2011. The consensus estimate called for EPS of $5.85 on revenues of $19.66 billion.

On a GAAP basis, the company reported quarterly EPS of $1.56 and full-year EPS of $5.83.

The company's CEO said:

As we enter 2013, we recognize that there are some near-term headwinds facing us in the North American land market. … We also enter the year with the firm belief that the oil and gas industry will continue to upgrade the world's aging rig fleet, while simultaneously building out both a deepwater and a worldwide shale infrastructure that are still in the early stages of development, and we look forward to playing a leadership role in those efforts.

National could be well on its way. The company's backlog going into the new year totaled $11.86 billion, a record, and new orders written during the fourth quarter totaled $2.42 billion.

The largest revenue gain came in the firm's rig technology segment, which was up 14% year-over-year. The operating margin was up 6% sequentially and 13% year-over-year. Continued growth in offshore rig demand will serve National well in the next year.

National did not offer guidance in its press announcement, but the consensus estimate for the first quarter calls for EPS of $1.50 on revenues of $5.46 billion, and for the full-year the EPS and revenues estimates are $6.46 and $22.72 billion, respectively.

National's shares are up about 2.5% in premarket trading, at $75.97 in a 52-week range of $59.07 to $89.95. Thomson Reuters had a consensus analyst price target of around $89.70 before today's report.

Filed under: 24/7 Wall St. Wire, Commodities, Earnings, Oil & Gas Tagged: NOV