Published: 01/22/2021
Published: 01/22/2021
Q4 2020 Earnings Release, with Financial Tables (275 KB PDF)
Q4 2020 Earnings Conference Call Prepared Remarks (134 KB PDF)
Q4 2020 Earnings Conference Call Transcript (173 KB PDF)
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HOUSTON, January 22, 2021—Schlumberger Limited (NYSE: SLB) today reported results for the fourth-quarter and full-year 2020.
(Stated in millions, except per share amounts) | |||||||
Three Months Ended | Change | ||||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | |||
Revenue | $5,532 | $5,258 | $8,228 | 5% | -33% | ||
Income (loss) before taxes - GAAP basis | $471 | $(54) | $452 | n/m | 4% | ||
Net income (loss) - GAAP basis | $374 | $(82) | $333 | n/m | 12% | ||
Diluted EPS (loss per share) - GAAP basis | $0.27 | $(0.06) | $0.24 | n/m | 12% | ||
Adjusted EBITDA* |
$1,112 |
$1,018 |
$1,648 |
9% |
-33% |
||
Adjusted EBITDA margin* | 20.1% | 19.4% | 20.0% | 73 bps | 6 bps | ||
Pretax segment operating income* | $654 | $575 | $1,006 | 14% | -35% | ||
Pretax segment operating margin* | 11.8% | 10.9% | 12.2% | 90 bps | -40 bps | ||
Net income, excluding charges & credits* | $309 | $228 | $545 | 35% | -43% | ||
Diluted EPS, excluding charges & credits* | $0.22 | $0.16 | $0.39 | 37% | -44% | ||
Revenue by Geography |
|||||||
International | $4,343 | $4,210 | $5,834 | 3% | -26% | ||
North America |
1,167 | 1,034 | 2,339 | 13% | -50% | ||
22 | 14 | 55 | n/m | n/m | |||
$5,532 | $5,258 | $8,228 | 5% | -33% | |||
*These are non-GAAP financial measures. See sections titled “Charges & Credits”, “Divisions”, “Geographical”, and “Supplemental Information” for details. |
|||||||
n/m = not meaningful |
|||||||
Schlumberger CEO Olivier Le Peuch commented, “We concluded the year posting very strong fourth-quarter results, as we leveraged the industry recovery, which has now commenced. Fourth-quarter revenue grew 5% sequentially, driven by strong activity and solid execution both in North America and in the international markets. Despite seasonality, revenue grew sequentially in all four Divisions for the first time since the third quarter of 2019. I stand very proudly behind the performance of the entire Schlumberger team during the quarter, closing an exceptional year of operational resilience and performance for our customers.
“Sequentially, international revenue growth visibly outpaced rig count and was led by Latin America and a global rebound of activity in most offshore deepwater markets. In the Middle East & Asia, growth was mostly in China, India, and Oman while Saudi Arabia remained resilient. In Europe/CIS/Africa, activity increased significantly in the offshore markets of Africa and several countries in Europe offset by the seasonal winter slowdown in Russia. In North America, offshore activity in the US Gulf of Mexico grew, and on land, increased horizontal drilling and pressure pumping activity contributed to higher revenue.
(Stated in millions) | |||||||
Three Months Ended | Change | ||||||
Revenue by Division | Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | ||
Digital & Integration | $833 | $740 | $1,112 | 13% | -25% | ||
Reservoir Performance | 1,247 | 1,215 | 2,122 | 3% | -41% | ||
Well Construction | 1,866 | 1,835 | 3,009 | 2% | -38% | ||
Production Systems | 1,649 | 1,532 | 2,131 | 8% | -23% | ||
Other | (63) | (64) | (146) | n/m | n/m | ||
$5,532 | $5,258 | $8,228 | 5% | -33% | |||
Pretax Operating Income by Division |
|||||||
Digital & Integration | $270 | $202 | $259 | 33% | 4% | ||
Reservoir Performance | 95 | 103 | 227 | -8% | -58% | ||
Well Construction | 183 | 172 | 373 | 6% | -51% | ||
Production Systems | 155 | 132 | 206 | 18% | -24% | ||
Other | (49) | (34) | (59) | n/m | n/m | ||
$654 | $575 | $1,006 | 14% | -35% | |||
Pretax Operating Margin by Division |
|||||||
Digital & Integration | 32.4% | 27.3% | 23.2% | 507 bps | 914 bps | ||
Reservoir Performance | 7.6% | 8.4% | 10.7% | -84 bps | -307 bps | ||
Well Construction | 9.8% | 9.4% | 12.4% | 42 bps | -261 bps | ||
Production Systems | 9.4% | 8.6% | 9.6% | 82 bps | -23 bps | ||
Other | n/m | n/m | n/m | n/m | n/m | ||
11.8% | 10.9% | 12.2% | 90 bps | -39 bps | |||
n/m = not meaningful |
“Digital & Integration revenue increased 13% sequentially driven by Asset Performance Solutions (APS) projects, increased multiclient seismic license sales, and higher digital solutions and software sales internationally. Reservoir Performance and Well Construction revenue increased 3% and 2%, respectively, due to higher activity in North America, Latin America, and in Middle East & Asia partially offset by the seasonal winter slowdown in Russia. Production Systems revenue increased 8% sequentially and grew in North America and internationally.
“Sequentially, fourth-quarter pretax operating income and adjusted EBITDA increased 14% and 9%, respectively. Pretax operating income margin and adjusted EBITDA margin expanded to reach 12% and 20%, respectively, achieving the same level as the fourth quarter of 2019 despite a 33% decline in revenue year-on-year. Sequentially, incremental EBITDA margin was 34%, demonstrating the ability of our new Divisions to enhance operating leverage, fully preparing us for the growth cycle ahead.
“Fourth-quarter cash flow from operations was $878 million and free cash flow was $554 million despite severance payments of $144 million. We are confident in our ability to further improve cash flow generation in 2021, which will allow for debt reduction.
“Regarding the macro outlook, oil prices have risen, buoyed by recent supply-led OPEC+ policy, the ongoing COVID-19 vaccine rollout, and multinational economic stimulus actions—driving optimism for an oil demand recovery throughout 2021. We believe this sets the stage for oil demand to recover to 2019 levels no later than 2023, or earlier as per recent industry analysts’ reports, reinforcing a multiyear cycle recovery as the global economy strengthens. Absent a setback in these macro assumptions, this will translate to meaningful activity increases both in North America and internationally.
“In North America, spending and activity momentum will continue in the first half of 2021 towards maintenance levels, albeit moderated by capital discipline and industry consolidation. Internationally, following the seasonal effects of the first quarter of 2021, and as OPEC+ responds to strengthening oil demand, higher spending is expected from the second quarter of 2021 onwards. Accelerated activity will extend beyond the short-cycle markets and will be broad, including offshore, as witnessed during the fourth quarter.
“The quality of our results in the fourth quarter of 2020 validates the progress of our performance strategy and the reinvention of Schlumberger in this new chapter for the industry. Building from the swift execution and scale of our cost-out program, we exited the year with quarterly margins reset to 2019 levels as the upcycle begins. On the back of our high-graded and restructured business portfolio, we see a clear path to achieve double-digit margins in North America and visible international margin improvement in 2021. Given the depth, diversity, and executional capability of our international business, we are uniquely positioned to benefit as international spending accelerates in the near- and midterm.
“By leveraging our new Basin and Division structure, we are fully set to capitalize on the growth drivers of the future of our industry, particularly as we accelerate our digital growth ambition and lead in the production and recovery market. Finally, to meet our long-term ambition to bring lower carbon and carbon-neutral energy sources and technology to market, we are visibly expanding our New Energy portfolio, to contribute to the transformation of a more resilient, sustainable, and investable energy services industry.”
On December 31, 2020, Schlumberger closed the contribution to Liberty Oilfield Services Inc. (Liberty) of OneStim®, Schlumberger’s onshore hydraulic fracturing business in the United States and Canada, including its pressure pumping, pumpdown perforating, and Permian frac sand businesses, in exchange for a 37% equity interest in Liberty.
On January 21, 2021, Schlumberger’s Board of Directors approved a quarterly cash dividend of $0.125 per share of outstanding common stock, payable on April 8, 2021 to stockholders of record on February 17, 2021.
(Stated in millions) | |||||||
Three Months Ended | Change | ||||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | |||
North America | $1,167 | $1,034 | $2,339 | 13% | -50% | ||
Latin America | 969 | 828 | 1,142 | 17% | -15% | ||
Europe/CIS/Africa | 1,366 | 1,397 | 2,018 | -2% | -32% | ||
Middle East & Asia | 2,008 | 1,985 | 2,674 | 1% | -25% | ||
Other | 22 | 14 | 55 | n/m | n/m | ||
$5,532 | $5,258 | $8,228 | 5% | -33% | |||
n/m = not meaningful | |||||||
Certain prior period amounts have been reclassified to conform to the current period presentation. |
North America area revenue of $1.2 billion increased 13% sequentially with strong growth both on land and offshore. Land revenue increased driven by Well Construction activity on higher rig count and OneStim activity through additional fleet redeployments. Offshore revenue grew due to higher sales of subsea production systems and year-end multiclient seismic licenses.
Revenue in the Latin America area of $969 million increased 17% sequentially with continued strength in Ecuador, Colombia, offshore Brazil, Guyana, and Argentina. Ecuador revenue increased on APS projects, higher sales of well production systems, increased intervention services, and a rebound in drilling activity. Revenue increased in Colombia from drilling project startups, in Brazil from the resumption of offshore drilling and sales of production systems, in Guyana from increased intervention and stimulation activity, and in Argentina from higher drilling activity.
Europe/CIS/Africa area revenue of $1.4 billion decreased 2% sequentially mainly due to the seasonal winter activity slowdown in Russia & Central Asia while activity increased significantly in Angola, Nigeria, Gabon, and several countries in Europe. Revenue increased in Angola from drilling project startups, in Scandinavia from increased sales of subsea and well production systems, in Gabon and Nigeria from new project startups, and in Mozambique from multiclient seismic license sales. Significant digital solutions and software sales were made in Russia, Scandinavia, Romania, Ukraine, and Turkey.
Revenue in the Middle East & Asia area of $2.0 billion increased 1% sequentially. Revenue growth was mainly in China, India, and Oman, partially offset by declines in Egypt, East Asia, and Kuwait. Revenue in China increased from sales of production systems and digital solutions and higher drilling and measurement activity. Production Systems sales drove growth in India and Oman but declined in Egypt, East Asia, and Kuwait. Revenue in Saudi Arabia was resilient as reduced stimulation, logging, and drilling activity was offset by higher sales of production systems. Qatar revenue was also resilient as reduced stimulation activity was offset by higher drilling activity.
(Stated in millions) | ||||||
Three Months Ended | Change | |||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | ||
Revenue | $833 | $740 | $1,112 | 13% | -25% | |
Pretax operating income | $270 | $202 | $259 | 33% | 4% | |
Pretax operating margin | 32.4% | 27.3% | 23.2% | 507 bps | 914 bps |
Digital & Integration revenue of $833 million, 83% of which came from the international markets, increased 13% sequentially. International revenue increased by 14% and North America revenue increased by 6% sequentially. Digital & Integration revenue increased from APS projects, increased multiclient seismic license sales in Mozambique, US land, and the US Gulf of Mexico, and higher digital solutions and software sales internationally.
Digital & Integration pretax operating margin of 32% expanded by 507 bps sequentially. The margin expansion was primarily in the international markets and was driven by improved profitability across APS projects, digital solutions, and multiclient seismic license sales from higher activity.
(Stated in millions) | ||||||
Three Months Ended | Change | |||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | ||
Revenue | $1,247 | $1,215 | $2,122 | 3% | -41% | |
Pretax operating income | $95 | $103 | $227 | -8% | -58% | |
Pretax operating margin | 7.6% | 8.4% | 10.7% | -84 bps | -307 bps |
Reservoir Performance revenue of $1.2 billion, 73% of which came from the international markets, increased 3% sequentially. International revenue declined 3% while North America revenue increased 23% sequentially. The revenue increase was driven by higher OneStim activity in North America, higher intervention services from project startups in Ecuador and Colombia, and increased intervention and stimulation activity in Guyana. This increase, however, was partially offset by seasonality in Russia and reduced stimulation, intervention, and evaluation activity in Saudi Arabia and Qatar.
Reservoir Performance pretax operating margin of 8% decreased 84 bps sequentially driven by seasonality in Russia despite improved North American activity.
(Stated in millions) | ||||||
Three Months Ended | Change | |||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | ||
Revenue | $1,866 | $1,835 | $3,009 | 2% | -38% | |
Pretax operating income | $183 | $172 | $373 | 6% | -51% | |
Pretax operating margin | 9.8% | 9.4% | 12.4% | 42 bps | -261 bps |
Well Construction revenue of $1.9 billion, 84% of which came from the international markets, increased 2% sequentially. International and North America revenue increased 1% and 7%, respectively. The revenue increase was due to higher measurement, drilling, and fluids activity in North America, Latin America, and the Middle East & Asia, partially offset by seasonality in Russia. The North America revenue increase was driven by higher rig count on land while the Latin America revenue growth was due to the resumption of drilling in Ecuador, offshore Brazil, Guyana, and Argentina, and from project startups in Colombia. The revenue increase in Africa was a result of project startups in Angola, Gabon, and Nigeria, while the Middle East & Asia growth was driven by higher drilling activity in China and Qatar.
Sequentially, Well Construction pretax operating margin of 10% improved by 42 bps. North America margin improved due to higher drilling activity on land while international margin was essentially flat.
(Stated in millions) | ||||||
Three Months Ended | Change | |||||
Dec. 31, 2020 | Sept. 30, 2020 | Dec. 31, 2019 | Sequential | Year-on-year | ||
Revenue | $1,649 | $1,532 | $2,131 | 8% | -23% | |
Pretax operating income | $155 | $132 | $206 | 18% | -24% | |
Pretax operating margin | 9.4% | 8.6% | 9.6% | 82 bps | -23 bps |
Production Systems revenue of $1.6 billion, 74% of which came from the international markets, increased 8% sequentially. International and North America revenue increased 7% and 11%, respectively, due to higher subsea, midstream, and surface production systems sales and services activity across all areas. Revenue increased in subsea production systems in North America, Scandinavia, Nigeria, Angola, China, and India. Revenue increased in surface production systems in North America, Argentina, Saudi Arabia, and Iraq. Midstream production systems sales increased in Brazil, Mexico, Saudi Arabia, Oman, and North Africa.
Production Systems pretax operating margin of 9% increased by 82 bps sequentially due to a higher contribution from the long-cycle business of subsea, and profitability improvement in well and surface production systems due to cost reduction measures and higher activity.
The recovery cycle has begun, digital adoption is accelerating, and sanctioned projects are commencing on land and offshore, while others are approaching FID. In this improving environment, Schlumberger continues to win multiyear contract awards, particularly internationally. Awards during the quarter include:
The new industry landscape demands increased discipline in capital investment and maximum efficiencies in production and recovery. Schlumberger creates and deploys technology and processes to help customers increase value from their existing assets by enhancing production and boosting recovery. Examples from the quarter include:
Our fit-for-basin approach as part of our performance strategy is helping operators address their challenges and extend their technical limits. Through innovative technology adapted for local geological context, business models tailored to regional dynamics, and enhanced in-country value, Schlumberger is at the forefront of basin innovation to deliver a step change in performance for our customers. Examples from the quarter include:
As the industry continues to embrace digital transformation, we are working with customers and domain experts to develop and apply novel AI and machine learning solutions, made available on our digital platform, to create a step change in process efficiency.
A diverse range of customers continue to adopt Schlumberger digital technologies across several geographies and use cases, from increasing enterprisewide performance to advancing national energy strategy, with the aim to improve asset efficiency, operational cost, and performance.
The application of our digital solutions also extends beyond our core industry and will support customers actively participating in the energy transition.
Decarbonization is not only a necessity, but a tremendous opportunity for Schlumberger, where we can leverage our intellectual and business capital consistent with our commitment to being at the forefront of our industry’s shift toward more sustainable energy production. Schlumberger New Energy focuses on low-carbon and carbon-neutral energy technologies. The portfolio build-out continues to gain momentum, accelerating throughout 2020.
1) What is the capital investment guidance for the full-year 2021?
Capital investment (comprised of capex, multiclient, and APS investments) for the full-year 2021 is expected to be between $1.5 to $1.7 billion. Capital investment in 2020 was $1.5 billion.
2) What were cash flow from operations and free cash flow for the fourth quarter of 2020?
Cash flow from operations for the fourth quarter of 2020 was $878 million and free cash flow was $554 million, despite making $144 million of severance payments during the quarter.
3) What were the cash flow from operations and free cash flow for the full year of 2020?
Cash flow from operations for the full year of 2020 was $2.9 billion. Free cash flow for the full year of 2020 was $1.4 billion, despite making $843 million of severance payments during the year.
4) What was included in “Interest and other income” for the fourth quarter of 2020?
“Interest and other income” for the fourth quarter of 2020 was $69 million. This amount consisted of an unrealized gain on marketable securities of $39 million (see section “Charges & Credits”), earnings of equity method investments of $25 million, and interest income of $5 million.
5) How did interest income and interest expense change during the fourth quarter of 2020?
Interest income of $5 million for the fourth quarter of 2020 increased $2 million sequentially. Interest expense of $144 million increased $6 million sequentially.
6) What is the difference between Schlumberger’s consolidated income (loss) before taxes and pretax segment operating income?
The difference consists of corporate items, charges and credits, and interest income and interest expense not allocated to the segments as well as stock-based compensation expense, amortization expense associated with certain intangible assets, certain centrally managed initiatives, and other nonoperating items.
7) What was the effective tax rate (ETR) for the fourth quarter of 2020?
The ETR for the fourth quarter of 2020, calculated in accordance with GAAP, was 18.9% as compared to –35.1% for the third quarter of 2020. Excluding charges and credits, the ETR for the fourth quarter of 2020 was 18.8% as compared to 19.9% for the third quarter of 2020.
8) How many shares of common stock were outstanding as of December 31, 2020 and how did this change from the end of the previous quarter?
There were 1.392 billion shares of common stock outstanding as of December 31, 2020 and 1.392 billion as of September 30, 2020.
(Stated in millions) | ||
Shares outstanding at September 30, 2020 | 1,392 | |
Vesting of restricted stock | - | |
Shares outstanding at December 31, 2020 | 1,392 |
9) What was the weighted average number of shares outstanding during the fourth quarter of 2020 and third quarter of 2020? How does this reconcile to the average number of shares outstanding, assuming dilution, used in the calculation of diluted earnings per share, excluding charges and credits?
The weighted average number of shares outstanding was 1.392 billion during the fourth quarter of 2020 and 1.391 billion during the third quarter of 2020. The following is a reconciliation of the weighted average shares outstanding to the average number of shares outstanding, assuming dilution, used in the calculation of diluted earnings per share, excluding charges and credits.
(Stated in millions) | |||
Fourth Quarter 2020 |
Third Quarter 2020 |
||
Weighted average shares outstanding | 1,392 | 1,391 | |
Unvested restricted stock | 19 | 18 | |
Average shares outstanding, assuming dilution | 1,411 | 1,409 |
10) What are the components of depreciation and amortization expense for the fourth quarter of 2020 and the third quarter of 2020?
The components of depreciation and amortization expense for the fourth quarter of 2020 and third quarter of 2020 were as follows:
(Stated in millions) | |||
Fourth Quarter 2020 |
Third Quarter 2020 |
||
Depreciation of fixed assets | $374 | $385 | |
Amortization of APS investments | 88 | 87 | |
Amortization of intangible assets | 79 | 79 | |
Amortization of multiclient seismic data costs capitalized | 42 | 36 | |
$583 | $587 |
11) What was the amount of WesternGeco multiclient sales in the fourth quarter of 2020?
Multiclient sales, including transfer fees, were $61 million in the fourth quarter of 2020 and $44 million in the third quarter of 2020.
12) What was Schlumberger’s adjusted EBITDA in the fourth quarter of 2020, the third quarter of 2020, the fourth quarter of 2019, full-year 2020, and full-year 2019?
Schlumberger’s adjusted EBITDA was $1.112 billion in the fourth quarter of 2020, $1.018 billion in the third quarter of 2020, and $1.648 billion in the fourth quarter of 2019, and was calculated as follows:
(Stated in millions) | ||||
Fourth Quarter 2020 |
Third Quarter 2020 |
Fourth Quarter 2019 |
||
Net income (loss) attributable to Schlumberger | $374 | $(82) | $333 | |
Net income attributable to noncontrolling interests | $8 | 9 | 10 | |
Tax expense | $89 | 19 | 109 | |
Income (loss) before taxes | $471 | $(54) | $452 | |
Charges & credits | (81) | 350 | 209 | |
Depreciation and amortization | 583 | 587 | 848 | |
Interest expense | 144 | 138 | 146 | |
Interest income | (5) | (3) | (7) | |
Adjusted EBITDA | $1,112 | $1,018 | $1,648 |
Schlumberger’s adjusted EBITDA was $4.313 billion in full-year 2020 and $6.640 billion in full-year 2019, and was calculated as follows:
(Stated in millions) | |||
2020 | 2019 | ||
Net loss attributable to Schlumberger | $(10,518) | $(10,137) | |
Net income attributable to noncontrolling interests | 32 | 30 | |
Tax benefit expense | (812) | (311) | |
Loss before taxes | $(11,298) | $(10,418) | |
Charges & credits | 12,515 | 12,901 | |
Depreciation and amortization | 2,566 | 3,589 | |
Interest expense | 563 | 609 | |
Interest income | (33) | (41) | |
Adjusted EBITDA | $4,313 | $6,640 |
Adjusted EBITDA represents income before taxes excluding charges & credits, depreciation and amortization, interest expense, and interest income. Management believes that adjusted EBITDA is an important profitability measure for Schlumberger and that it allows investors and management to more efficiently evaluate Schlumberger’s operations period over period and to identify operating trends that could otherwise be masked. Adjusted EBITDA is also used by management as a performance measure in determining certain incentive compensation. Adjusted EBITDA should be considered in addition to, not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP.
13) What are the components of the net pretax charges & credits recorded during the fourth quarter of 2020?
The component of the net pretax charges & credits are as follows (in millions):
Gain on sale of OneStim(a) | $(104) | |
Unrealized gain on marketable securities(b) | (39) | |
Other(c) | 62 | |
$(81) |
Schlumberger (SLB: NYSE) is a technology company that partners with customers to access energy. Our people, representing over 160 nationalities, are providing leading digital solutions and deploying innovative technologies to enable performance and sustainability for the global energy industry. With expertise in more than 120 countries, we collaborate to create technology that unlocks access to energy for the benefit of all.
Find out more at www.slb.com.
*Mark of Schlumberger or Schlumberger companies.
Schlumberger will hold a conference call to discuss the earnings press release and business outlook on Friday, January 22, 2021. The call is scheduled to begin at 8:30 a.m. US Eastern Time. To access the call, which is open to the public, please contact the conference call operator at +1 (844) 721-7241 within North America, or +1 (409) 207-6955 outside North America, approximately 10 minutes prior to the call’s scheduled start time, and provide the access code 2660129. At the conclusion of the conference call, an audio replay will be available until February 22, 2021 by dialing +1 (866) 207-1041 within North America, or +1 (402) 970-0847 outside North America, and providing the access code 5881344. The conference call will be webcast simultaneously at www.slb.com/irwebcast on a listen-only basis. A replay of the webcast will also be available at the same website until February 22, 2021.
Ndubuisi Maduemezia – Vice President of Investor Relations, Schlumberger Limited
Joy V. Domingo – Director of Investor Relations, Schlumberger Limited
Office +1 (713) 375-3535
investor-relations@slb.com
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This fourth-quarter and full-year 2020 earnings release, as well as other statements we make, contain “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts, such as our forecasts or expectations regarding business outlook; growth for Schlumberger as a whole and for each of its Divisions (and for specified business lines or geographic areas within each Division); oil and natural gas demand and production growth; oil and natural gas prices; pricing; Schlumberger’s response to, and preparedness for, the COVID-19 pandemic and other widespread health emergencies; improvements in operating procedures and technology; capital expenditures by Schlumberger and the oil and gas industry; the business strategies of Schlumberger, including digital and “fit for basin,” as well as the strategies of Schlumberger’s customers; Schlumberger’s restructuring efforts and charges recorded as a result of such efforts; access to raw materials; our effective tax rate; Schlumberger’s APS projects, joint ventures and other alliances; future global economic and geopolitical conditions; future liquidity; and future results of operations, such as margin levels. These statements are subject to risks and uncertainties, including, but not limited to, changing global economic conditions; changes in exploration and production spending by Schlumberger’s customers, and changes in the level of oil and natural gas exploration and development; the results of operations and financial condition of Schlumberger’s customers and suppliers, particularly during extended periods of low prices for crude oil and natural gas; Schlumberger’s inability to achieve its financial and performance targets and other forecasts and expectations; Schlumberger’s inability to sufficiently monetize assets; the extent of future charges; general economic, geopolitical, and business conditions in key regions of the world; foreign currency risk; pricing pressure; weather and seasonal factors; unfavorable effects of health pandemics; availability and cost of raw materials; operational modifications, delays, or cancellations; challenges in Schlumberger’s supply chain; production declines; Schlumberger’s inability to recognize intended benefits from its business strategies and initiatives, such as digital or Schlumberger New Energy; as well as its restructuring and structural cost reduction plans; changes in government regulations and regulatory requirements, including those related to offshore oil and gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; the inability of technology to meet new challenges in exploration; the competitiveness of alternative energy sources or product substitutes; and other risks and uncertainties detailed in this fourth-quarter and full-year 2020 earnings release and our most recent Forms 10-K, 10-Q, and 8-K filed with or furnished to the Securities and Exchange Commission. If one or more of these or other risks or uncertainties materialize (or the consequences of any such development changes), or should our underlying assumptions prove incorrect, actual outcomes may vary materially from those reflected in our forward-looking statements. Statements in this fourth-quarter and full-year 2020 earnings release are made as of the date of this release, and Schlumberger disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events, or otherwise.
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