• NOV today reported first quarter 2019 revenues of $1.94 billion, a decrease of 19 percent compared to the fourth quarter of 2018 and an increase of eight percent from the first quarter of 2018. Operating loss for the first quarter of 2019 was $48 million, net loss was $77 million, and Adjusted EBITDA (operating profit excluding depreciation, amortization, and other items) was $140 million, or 7.2 percent of sales. Adjusted EBITDA decreased $139 million sequentially and $20 million compared to the first quarter of 2018.

    "Two big challenges negatively impacted our quarter—oilfield service customers cut expenditures due to low year-end oil prices and sliding producer activity outlook, and offshore sales declined following the accelerated equipment deliveries we saw in the fourth quarter," commented Clay Williams, Chairman, President, and CEO. "Additionally, the volume of orders for new capital equipment fell sharply in late 2018 and remained sparse through the first two months of the year. Nevertheless, customer confidence improved month-by-month through the first quarter as commodity prices strengthened. Strong order acceleration in March enabled NOV to post a sequential increase in bookings, improving our outlook for the second quarter and remainder of 2019."

    "While we expect modestly improving activity in international and offshore markets, along with growing market penetration for NOV's proprietary technologies and services, capital austerity in the North American land market leaves our near-term outlook uncertain. Consequently, we are renewing our focus on controlling what we can, namely our cost structure, as we streamline our operations to improve our organization's profitability, regardless of the market environment."

    NOV had several significant achievements this quarter:
    NOV booked an order from BP and the Azeri Central East (ACE) Project partners for the drilling and mud equipment package for the ACE platform in the Caspian Sea. This award is the culmination of a rigorous 2-year process, which included initial qualification for the project and competitive Front-End Engineering Design (FEED) studies.

    NOV opened its new, state-of-the-art Fiber Glass Systems manufacturing facility in Dammam, Saudi Arabia. This 24 000 m² manufacturing facility is the first local producer of spoolable and jointed glass-reinforced epoxy (GRE) pipe in the Kingdom. The facility also makes GRE high-pressure line pipe and downhole tubing and casing.

    NOV expanded the international reach of its measurement-while-drilling (MWD) and steerable technologies portfolio during the first quarter of 2019, securing its first long-term rental contract to deploy Vector rotary steerable system (RSS) tools in the MENA region and deploying its iSeries™ MWD tools in Mexico, Turkey, and the Middle East for the first time.

    NOV signed an agreement with a major operator in Oman for onshore treatment of oil-based-mud drill cuttings using NOV's hot oil thermal desorption unit, a novel thermal treatment technology. The equipment will help the operator treat legacy cuttings and backfill old, open drill pits, reducing drilling footprint.

    NOV secured a 93-pump order from a major midstream operator for a significant pipeline infrastructure buildout from the Permian Basin to the Gulf Coast in Texas. The large order adds to NOV's industry-leading installed base of more than 50,000 units.

    NOV Completion Tools successfully introduced its BPS™ Maxx and i-Opener™ TD systems. The BPS Maxx offers a significant increase in flow area compared to earlier generations of BPS products, and NOV's i-Opener TD incorporates a simple and robust time delay mechanism to allow intervention-less activation and opening of the sleeve to establish injectivity. NOV installed its first i-Opener TD system for a major operator in the Norwegian North Sea, providing savings of approximately $200,000 to $250,000 by eliminating the need for conventional wireline-tractor-conveyed perforating.

    NOV introduced BW Shield™, a proprietary coating technology that reduces corrosion-related damage to bias welds on coiled tubing strings. BW Shield prevents localized bias weld corrosion, helping customers improve string life, increase reliability, and avoid service interruptions.

    NOV was made the primary fixed-cutter drill bit supplier for a major operator in India. The Company will provide the operator with a minimum of 60% of their fixed-cutter bit requirements over 3 years, a contract that encompassed 120 rigs and an expected 1,500 wells.

    NOV received the 2019 OTC Spotlight on New Technology Award, the second award in as many years, for its subsea automated pig launcher (SAPL). The SAPL allows pig launching from the subsea to topside and enables a wide range of pigging operations that help avoid pipeline blockages and production shutdowns while improving system integrity.

    NOV booked its first international order for a Genesis™ coiled tubing unit from a large independent service company operating in the Middle East, demonstrating growing demand for leading-edge completion equipment in international markets. The Genesis unit handles the greater lengths and diameters of the coiled tubing strings required in long horizontal wells and can handle the new HR-6120 injector head.

    NOV's TerraPULSE™ CT Agitator™ tool achieved success for an operator on a two-well project in South Texas. The tool was used to reduce friction in the wellbore while milling out frac plugs during a coiled tubing operation. On the two wells, which had laterals exceeding 13,000 ft in length, the TerraPULSE tool allowed the service company to drill out all the plugs and reach TD.

    NOV's MPowerD™ managed-pressure-drilling (MPD) product line continues to gain international traction. The Company introduced the first MPD system integrated with an MPD app on the NOVOS™ platform to a pilot project in Canada. In addition, NOV expanded its global footprint into Latin America with a major order from an operator in Argentina for an MPD system with the NOVOS application. Offshore, NOV delivered its second integrated MPD control system to an ultradeepwater drillship, with successful completion of installation and commissioning in March.

    NOV signed a 3-year, 10-rig contract for its solids control and waste management equipment services in the Permian for a major integrated oil company. This award comes from a successful field trial showcasing NOV's Advanced Fluid Recovery System (AFRS), which transfers whole wellbore cuttings directly from the shale shakers to a processing centrifuge, produces a dryer waste stream and cleaner recoverable drilling fluid.

    Read full press release here.

    Published Date: 2019-04-26
    Source: National Oilwell Varco