National Oilwell Varco's 3Q Profit Falls 30 Pct

HOUSTON (AP) — Oilfield-services provider National Oilwell Varco Inc. on Monday said pricing pressure, lower sales and reduced international rig counts drove down third-quarter earnings, while cost cuts in its rig technology segment added back to margins.

Compared to the prior-year quarter, when crude prices were trading at record levels as high as $147.27 per barrel, the most-recent quarter was defined by stabilizing oil prices between $59 and $74 per barrel. While these prices fall short of year-ago levels, this is a significant uptick from record-low prices at the start of 2009.

For companies such as National Oilwell Varco this is good news, as price stabilization prompted oil companies to resume exploration and production, generating fresh demand for oilfield services.

National Oilwell Varco's CEO Pete Miller said the company is "well positioned for the inevitable recovery in drilling activity."

Though National Oilwell Varco's third-quarter profit tumbled 30 percent on price and sales weakness, results beat analyst expectations.

Earnings for the three months ended Sept. 30 fell to $385 million, or 92 cents per share, compared with $548 million, or $1.31 per share, last year. The latest results include transaction and restructuring charges of 3 cents per share.

Excluding these items, the company earned 95 cents per share. That topped analysts' average profit estimate of 79 cents per share, according to a Thomson Reuters survey.

Revenue fell 15 percent to $3.09 billion, down from $3.61 billion, last year. Analysts had expected revenue of $2.9 billion.