SLB posts strong 2024 results, announces $2.3bn share repurchase and dividend increase
SLB, the energy technology leader driving global energy innovation, delivered a strong financial performance for 2024, marked by double-digit revenue growth, enhanced margins, and strategic returns to shareholders. The company reported notable gains across its digital offerings, production systems, and international operations, underlining its resilience amidst evolving industry conditions.
This report delves into SLB’s full-year financial performance, its strategic initiatives, and the outlook for 2025.
How Did SLB Perform Financially in 2024?
SLB’s financial results for 2024 reflect robust growth across its key business segments. The company achieved total revenue of $36.29 billion, up 10% year-on-year. This growth was fueled by a 12% increase in international revenue and strong performance from its Digital & Integration and Production Systems divisions.
- Net Income: SLB’s net income reached $4.46 billion, a 6% rise compared to 2023. Adjusted EBITDA grew 12% to $9.07 billion, supported by strategic cost optimization and improved operational efficiencies.
- Earnings Per Share: Adjusted earnings per share (EPS) rose to $3.41, a 14% year-on-year increase.
The company’s financial discipline translated into free cash flow of $3.99 billion, enabling it to support its capital investments, expand shareholder returns, and reduce net debt by $571 million.
Why Did SLB Announce a $2.3 Billion Share Buyback?
In a move to enhance shareholder value, SLB initiated a $2.3 billion accelerated share repurchase (ASR) program, reflecting its confidence in long-term business stability and undervaluation of its stock. The program follows the repurchase of 38.4 million shares in 2024 for $1.74 billion.
Additionally, the company increased its quarterly dividend by 3.6%, raising it to $0.285 per share, reaffirming its commitment to returning excess cash to shareholders.
Olivier Le Peuch, SLB’s CEO, highlighted the rationale behind these decisions:
“These initiatives underscore our confidence in the strength of our business and our ability to generate sustained cash flows, enabling us to provide enhanced returns to our stakeholders.”
What Led to SLB’s Regional and Segment Growth?
Regional Overview
International Operations: SLB’s international revenue climbed to $29.42 billion, led by significant growth in the Middle East, Asia, and Europe. The Middle East & Asia recorded an 18% year-on-year increase, achieving record revenues, while Europe & Africa rose 13%.
North America: Revenue reached $6.68 billion, with a 7% year-on-year increase driven by offshore activity in the Gulf of Mexico and robust digital product demand.
Business Segment Analysis
Digital & Integration:
SLB’s digital revenue surged 20%, driven by higher adoption of AI-powered platforms and autonomous drilling technologies. The segment contributed $2.44 billion in revenue for 2024, supported by solutions such as the Lumi AI platform and Performance Live remote operation centers.
Production Systems:
The Production Systems division saw 24% revenue growth, with a strong contribution from the Aker subsea business, acquired under the OneSubsea™ joint venture. Organic growth stood at 9%, led by artificial lift technologies, midstream production systems, and surface systems.
Reservoir Performance:
The division grew 9% year-on-year to $7.18 billion, driven by increased stimulation and intervention activities across international markets.
Well Construction:
Revenue from Well Construction dipped slightly by 1% to $13.36 billion, reflecting reduced drilling activity in North America and Saudi Arabia.
How Is SLB Advancing Its Digital and Low-Carbon Initiatives?
Digital Innovation
SLB’s digital transformation strategy continues to drive significant growth. The launch of the Lumi AI and data platform and advances in autonomous drilling operations have positioned the company as a leader in digital energy solutions. These initiatives underscore SLB’s ability to leverage technology for operational efficiency and enhanced production outcomes.
Decarbonization and Energy Transition
SLB remains committed to its low-carbon agenda through partnerships and groundbreaking projects. Notable achievements in 2024 include:
- A carbon capture and storage (CCS) hub partnership with Aramco and Linde in Saudi Arabia, set to capture up to 9 million metric tons of CO2 annually by 2027.
- Completion of a carbon capture plant at Heidelberg Materials’ Brevik facility in Norway, capable of capturing 400,000 metric tons of CO2 annually.
These projects align with SLB’s broader strategy of contributing to global decarbonization while maintaining leadership in oil and gas exploration technologies.
What’s Next for SLB in 2025?
Looking ahead, SLB expects steady upstream investment growth, supported by rising global energy demand and enhanced energy security measures. Key areas of focus include:
- Further Digital Expansion: SLB plans to deepen its investment in AI and data-driven solutions to maintain its competitive edge in the digital energy landscape.
- Strengthening Production Systems: The anticipated acquisition of ChampionX will bolster SLB’s production capabilities, providing greater resilience against market cycles.
- New Energy Projects: SLB aims to expand its portfolio of CCS and renewable energy projects, building on its strong foundation in low-carbon technologies.
CEO’s Vision
“SLB is uniquely positioned to deliver long-term value through its unmatched digital capabilities, innovative production solutions, and commitment to decarbonization,” said Olivier Le Peuch.
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