Earnings Roundup: National Oilwell Varco Inc. (NYSE: NOV)

On Friday, Shares of National Oilwell Varco Inc. (NYSE: NOV) declined -1.03% to $26.97. The stock traded total volume of 2,826,067 shares lower than the average volume of 3.77M shares.

National Oilwell Varco, Inc. (NOV) recently stated fourth quarter 2018 revenues of $2.400B, a boost of 11 percent contrast to the third quarter of 2018 and a boost of 22 percent from the fourth quarter of 2017.

Operating profit for the fourth quarter of 2018 was $87.0M, or 3.6 percent of sales, Adjusted EBITDA (operating profit excluding depreciation, amortization, and other items) was $279.0M, or 11.6 percent of sales, and net income was $12.0M. Operating profit increased 19 percent sequentially, and Adjusted EBITDA increased 14 percent sequentially and 42 percent contrast to the fourth quarter of 2017. Other items totaled $21.0M, pre-tax, and were mainly related to charges associated with the closure of one of the Company’s facilities.

Revenues for the full year 2018 were $8.450B, operating profit was $211.0M, and net loss was $31.0M, or $0.08 per share. Adjusted EBITDA for the full year was $910.0M, or 10.8 percent of sales.

Wellbore Technologies:

Wellbore Technologies generated revenues of $884.0M in the fourth quarter of 2018, a boost of four percent from the third quarter of 2018 and a boost of 24 percent from the fourth quarter of 2017. The segment’s revenue growth continued to outpace domestic and global activity levels, with sales increasing 4.5 percent in the U.S. and 2.1 percent in international markets. The segment’s WellSite Services and Grant Prideco business units posted double-digit percent sequential increases supported by bookings of solids control equipment and drill pipe, respectively, which improved throughout the first three quarters of 2018. Operating profit was $41.0M, or 4.6 percent of sales. Adjusted EBITDA increased 15 percent sequentially and 45 percent from the prior year to $155.0M, or 17.5 percent of sales. An improved mix of business and higher volumes resulted in 54 percent sequential Adjusted EBITDA incrementals (the change in Adjusted EBITDA divided by the change in revenue).

Completion & Production Solutions:

Completion & Production Solutions generated revenues of $788.0M in the fourth quarter of 2018, a boost of seven percent from the third quarter of 2018 and a boost of 14 percent from the fourth quarter of 2017. The sequential increase in revenue was the result of improved progress and deliveries on projects and continued growth in demand for coiled tubing and wireline equipment. Operating profit was $64.0M, or 8.1 percent of sales. Adjusted EBITDA increased 13 percent sequentially and 51 percent from the prior year to $112.0M, or 14.2 percent of sales. Anticipated resin supply shortages in the Company’s Fiber Glass Systems business unit and holiday slowdowns influenced manufacturing plant absorption, limiting sequential Adjusted EBITDA incrementals to 25 percent.

New orders booked during the quarter were $470.0M, representing a book-to-bill of 103 percent when contrast to the $456.0M of orders shipped from backlog. Backlog for capital equipment orders for Completion & Production Solutions at December 31, 2018 was $894.0M.

Rig Technologies:

Rig Technologies generated revenues of $804.0M in the fourth quarter of 2018, a boost of 26 percent from the third quarter of 2018 and a boost of 31 percent from the fourth quarter of 2017. Better progress on projects, delivery of two land rigs, and improved aftermarket sales resulted in the sequential revenue increase. Operating profit was $75.0M, or 9.3 percent of sales. Adjusted EBITDA increased 31 percent sequentially and 46 percent from the prior year to $102.0M, or 12.7 percent of sales. Adjusted EBITDA leverage was limited to 14 percent because of a change in product mix.

New orders booked during the quarter totaled $119.0M, representing a book-to-bill of 30 percent when contrast to the $403.0M of orders shipped from backlog. At December 31, 2018, backlog for capital equipment orders for Rig Technologies was $3.10B.

NOV has the market capitalization of $10.04B and its EPS growth ratio for the past five years was -15.10%. The return on assets ratio of the Company was -0.20% while its return on investment ratio stands at 0.90%. Price to sales ratio was 1.19 while 96.80% of the stock was owned by institutional investors.

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