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EXCEL - IDEA: XBRL DOCUMENT - SCHLUMBERGER LIMITED/NVFinancial_Report.xls

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2015

Commission file No.: 1-4601

 

SCHLUMBERGER N.V.

(SCHLUMBERGER LIMITED)

(Exact name of registrant as specified in its charter)

 

 

CURAÇAO

 

52-0684746

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.)

 

 

 

42 RUE SAINT-DOMINIQUE

 

 

PARIS, FRANCE

 

75007

 

 

 

5599 SAN FELIPE, 17th FLOOR

 

 

HOUSTON, TEXAS, U.S.A.

 

77056

 

 

 

62 BUCKINGHAM GATE

 

 

LONDON, UNITED KINGDOM

 

SW1E 6AJ

 

 

 

PARKSTRAAT 83 THE HAGUE,

 

 

THE NETHERLANDS

 

2514 JG

(Addresses of principal executive offices)

 

(Zip Codes)

Registrant’s telephone number in the United States, including area code, is:

(713) 513-2000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

x

Accelerated filer

¨

 

 

 

 

Non-accelerated filer

¨  (Do not check if a smaller reporting company)

Smaller reporting company

¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class

Outstanding at March 31, 2015

COMMON STOCK, $0.01 PAR VALUE PER SHARE

1,269,726,824

 

 

 


SCHLUMBERGER LIMITED

First Quarter 2015 Form 10-Q

Table of Contents

 

 

 

 

Page

 PART I

 

Financial Information

 

 

 

 

 

Item 1.

 

Financial Statements

3

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

16

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

24

 

 

 

 

Item 4.

 

Controls and Procedures

24

 

 

 

 

 PART II

 

Other Information

 

 

 

 

 

Item 1.

 

Legal Proceedings

25

 

 

 

 

Item 1A.

 

Risk Factors

25

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

25

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

25

 

 

 

 

Item 4.

 

Mine Safety Disclosures

25

 

 

 

 

Item 5.

 

Other Information

25

 

 

 

 

Item 6.

 

Exhibits

26

 

 

 

 

 

 

Certifications

 

 

 

 

2


PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements.

 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

(Unaudited)

 

 

(Stated in millions, except per share amounts)

 

Three Months

 

 

Ended March 31,

 

 

2015

 

 

2014

 

Revenue

$

10,248

 

 

$

11,239

 

Interest & other income

 

49

 

 

 

76

 

Expenses

 

 

 

 

 

 

 

Cost of revenue

 

8,096

 

 

 

8,745

 

Research & engineering

 

267

 

 

 

284

 

General & administrative

 

119

 

 

 

106

 

Restructuring & other

 

439

 

 

 

 

Interest

 

82

 

 

 

103

 

Income before taxes

 

1,294

 

 

 

2,077

 

Taxes on income

 

306

 

 

 

469

 

Net income

 

988

 

 

 

1,608

 

Net income attributable to noncontrolling interests

 

13

 

 

 

16

 

Net income attributable to Schlumberger

$

975

 

 

$

1,592

 

 

 

 

 

 

 

 

 

Basic earnings per share of Schlumberger

$

0.76

 

 

$

1.22

 

 

 

 

 

 

 

 

 

Diluted earnings per share of Schlumberger

$

0.76

 

 

$

1.21

 

 

 

 

 

 

 

 

 

Average shares outstanding:

 

 

 

 

 

 

 

Basic

 

1,276

 

 

 

1,306

 

Assuming dilution

 

1,285

 

 

 

1,318

 

    

See Notes to Consolidated Financial Statements

 

 

 

3


SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited)

 

(Stated in millions)

 

Three Months

 

 

Ended March 31,

 

 

2015

 

 

2014

 

Net income

$

988

 

 

$

1,608

 

Currency translation adjustments

 

 

 

 

 

 

 

Unrealized net change arising during the period

 

(113

)

 

 

(88

)

Marketable securities

 

 

 

 

 

 

 

Unrealized (loss) gain arising during the period

 

(18

)

 

 

11

 

Cash flow hedges

 

 

 

 

 

 

 

Net (loss) gain on cash flow hedges

 

(152

)

 

 

16

 

Reclassification to net income of net realized loss (gain)

 

118

 

 

 

(3

)

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

Actuarial loss

 

 

 

 

 

 

 

Amortization to net income of net actuarial loss

 

74

 

 

 

41

 

Prior service cost

 

 

 

 

 

 

 

Amortization to net income of net prior service cost

 

27

 

 

 

32

 

Income taxes on pension and other postretirement benefit plans

 

(15

)

 

 

(10

)

Comprehensive income

 

909

 

 

 

1,607

 

Comprehensive income attributable to noncontrolling interests

 

13

 

 

 

16

 

Comprehensive income attributable to Schlumberger

$

896

 

 

$

1,591

 

 

See Notes to Consolidated Financial Statements

 

 

 

4


SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

 

(Stated in millions)

 

Mar. 31,

 

 

 

 

 

 

2015

 

 

Dec. 31,

 

 

(Unaudited)

 

 

2014

 

ASSETS

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

 

Cash

$

2,121

 

 

$

3,130

 

Short-term investments

 

4,682

 

 

 

4,371

 

Receivables less allowance for doubtful accounts (2015 - $292; 2014 - $275)

 

10,443

 

 

 

11,171

 

Inventories

 

4,666

 

 

 

4,628

 

Deferred taxes

 

156

 

 

 

144

 

Other current assets

 

1,326

 

 

 

1,250

 

 

 

23,394

 

 

 

24,694

 

Fixed Income Investments, held to maturity

 

436

 

 

 

442

 

Investments in Affiliated Companies

 

3,272

 

 

 

3,235

 

Fixed Assets less accumulated depreciation

 

15,135

 

 

 

15,396

 

Multiclient Seismic Data

 

850

 

 

 

793

 

Goodwill

 

15,512

 

 

 

15,487

 

Intangible Assets

 

4,575

 

 

 

4,654

 

Other Assets

 

2,237

 

 

 

2,203

 

 

$

65,411

 

 

$

66,904

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

$

8,469

 

 

$

9,246

 

Estimated liability for taxes on income

 

1,631

 

 

 

1,647

 

Long-term debt - current portion

 

3,180

 

 

 

1,244

 

Short-term borrowings

 

648

 

 

 

1,521

 

Dividends payable

 

644

 

 

 

518

 

 

 

14,572

 

 

 

14,176

 

Long-term Debt

 

8,898

 

 

 

10,565

 

Postretirement Benefits

 

1,419

 

 

 

1,501

 

Deferred Taxes

 

1,363

 

 

 

1,296

 

Other Liabilities

 

1,293

 

 

 

1,317

 

 

 

27,545

 

 

 

28,855

 

Equity

 

 

 

 

 

 

 

Common stock

 

12,535

 

 

 

12,495

 

Treasury stock

 

(12,263

)

 

 

(11,772

)

Retained earnings

 

41,669

 

 

 

41,333

 

Accumulated other comprehensive loss

 

(4,285

)

 

 

(4,206

)

Schlumberger stockholders' equity

 

37,656

 

 

 

37,850

 

Noncontrolling interests

 

210

 

 

 

199

 

 

 

37,866

 

 

 

38,049

 

 

$

65,411

 

 

$

66,904

 

See Notes to Consolidated Financial Statements

 

 

 

5


SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

 

(Stated in millions)

 

 

Three Months Ended Mar. 31,

 

 

2015

 

 

2014

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

988

 

 

$

1,608

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

 

 

Restructuring and other charges

 

439

 

 

 

 

Depreciation and amortization (1)

 

1,042

 

 

 

1,001

 

Pension and other postretirement benefits expense

 

114

 

 

 

86

 

Stock-based compensation expense

 

80

 

 

 

77

 

Pension and other postretirement benefits funding

 

(120

)

 

 

(72

)

Earnings of equity method investments, less dividends received

 

(35

)

 

 

(61

)

Change in assets and liabilities: (2)

 

 

 

 

 

 

 

Decrease (increase) in receivables

 

793

 

 

 

(202

)

Increase in inventories

 

(52

)

 

 

(137

)

Increase in other current assets

 

(97

)

 

 

(181

)

Increase in other assets

 

(60

)

 

 

(31

)

Decrease in accounts payable and accrued liabilities

 

(1,348

)

 

 

(592

)

(Decrease) increase in estimated liability for taxes on income

 

(66

)

 

 

242

 

Decrease in other liabilities

 

(57

)

 

 

(20

)

Other

 

149

 

 

 

119

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

1,770

 

 

 

1,837

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Capital expenditures

 

(606

)

 

 

(864

)

SPM investments

 

(109

)

 

 

(202

)

Multiclient seismic data capitalized

 

(101

)

 

 

(82

)

Business acquisitions and investments, net of cash acquired

 

(44

)

 

 

(239

)

(Purchase) sale of investments, net

 

(307

)

 

 

1,576

 

Other

 

(70

)

 

 

(17

)

NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES

 

(1,237

)

 

 

172

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Dividends paid

 

(512

)

 

 

(410

)

Proceeds from employee stock purchase plan

 

144

 

 

 

134

 

Proceeds from exercise of stock options

 

38

 

 

 

146

 

Stock repurchase program

 

(719

)

 

 

(899

)

Proceeds from issuance of long-term debt

 

1,572

 

 

 

1,110

 

Repayment of long-term debt

 

(1,144

)

 

 

(1,574

)

Net decrease in short-term borrowings

 

(902

)

 

 

(222

)

Other

 

(2

)

 

 

7

 

NET CASH USED IN FINANCING ACTIVITIES

 

(1,525

)

 

 

(1,708

)

Net (decrease) increase in cash before translation effect

 

(992

)

 

 

301

 

Translation effect on cash

 

(17

)

 

 

(21

)

Cash, beginning of period

 

3,130

 

 

 

3,472

 

Cash, end of period

$

2,121

 

 

$

3,752

 

 

(1)

Includes depreciation of property, plant and equipment and amortization of intangible assets, multiclient seismic data costs and SPM investments.  

(2)

Net of the effect of business acquisitions.

See Notes to Consolidated Financial Statements

 

6


SCHLUMBERGER LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

(Unaudited)

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

January 1, 2015 – March 31, 2015

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, January 1, 2015

 

$

12,495

 

 

$

(11,772

)

 

$

41,333

 

 

$

(4,206

)

 

$

199

 

 

$

38,049

 

Net income

 

 

 

 

 

 

 

 

 

 

975

 

 

 

 

 

 

 

13

 

 

 

988

 

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(113

)

 

 

 

 

 

 

(113

)

Changes in unrealized gain on marketable securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18

)

 

 

 

 

 

 

(18

)

Changes in fair value of cash flow hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(34

)

 

 

 

 

 

 

(34

)

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

86

 

 

 

 

 

 

 

86

 

Shares sold to optionees, less shares exchanged

 

 

(16

)

 

 

54

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

38

 

Vesting of restricted stock

 

 

(39

)

 

 

39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued under employee stock purchase plan

 

 

9

 

 

 

135

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

144

 

Stock repurchase program

 

 

 

 

 

 

(719

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(719

)

Stock-based compensation expense

 

 

80

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

80

 

Dividends declared ($0.50 per share)

 

 

 

 

 

 

 

 

 

 

(639

)

 

 

 

 

 

 

 

 

 

 

(639

)

Other

 

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

4

 

Balance, March 31, 2015

 

$

12,535

 

 

$

(12,263

)

 

$

41,669

 

 

$

(4,285

)

 

$

210

 

 

$

37,866

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Retained

 

 

Comprehensive

 

 

Noncontrolling

 

 

 

 

 

January 1, 2014 – March 31, 2014

 

Issued

 

 

In Treasury

 

 

Earnings

 

 

Loss

 

 

Interests

 

 

Total

 

Balance, January 1, 2014

 

$

12,192

 

 

$

(8,135

)

 

$

37,966

 

 

$

(2,554

)

 

$

166

 

 

$

39,635

 

Net income

 

 

 

 

 

 

 

 

 

 

1,592

 

 

 

 

 

 

 

16

 

 

 

1,608

 

Currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(88

)

 

 

 

 

 

 

(88

)

Changes in unrealized gain on marketable securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11

 

 

 

 

 

 

 

11

 

Changes in fair value of cash flow hedges.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13

 

 

 

 

 

 

 

13

 

Pension and other postretirement benefit plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

63

 

 

 

 

 

 

 

63

 

Shares sold to optionees, less shares exchanged

 

 

(7

)

 

 

153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

146

 

Vesting of restricted stock

 

 

(30

)

 

 

30

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued under employee stock purchase plan

 

 

6

 

 

 

128

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

134

 

Stock repurchase program

 

 

 

 

 

 

(899

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(899

)

Stock-based compensation expense

 

 

77

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

77

 

Dividends declared ($0.40 per share)

 

 

 

 

 

 

 

 

 

 

(522

)

 

 

 

 

 

 

 

 

 

 

(522

)

Other

 

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(6

)

 

 

2

 

Balance, March 31, 2014

 

$

12,246

 

 

$

(8,723

)

 

$

39,036

 

 

$

(2,555

)

 

$

176

 

 

$

40,180

 

SHARES OF COMMON STOCK

(Unaudited)

  

 

 

 

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

Shares

 

 

Issued

 

 

In Treasury

 

 

Outstanding

 

Balance, January 1, 2015

 

1,434

 

 

 

(159

)

 

 

1,275

 

Shares sold to optionees, less shares exchanged

 

 

 

 

1

 

 

 

1

 

Vesting of restricted stock

 

 

 

 

1

 

 

 

1

 

Shares issued under employee stock purchase plan

 

 

 

 

2

 

 

 

2

 

Stock repurchase program

 

 

 

 

(9

)

 

 

(9

)

Balance, March 31, 2015

 

1,434

 

 

 

(164

)

 

 

1,270

 

 

See Notes to Consolidated Financial Statements

7


 

SCHLUMBERGER LIMITED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1.    Basis of Presentation

The accompanying unaudited consolidated financial statements of Schlumberger Limited and its subsidiaries (“Schlumberger”) have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.  In the opinion of Schlumberger management, all adjustments considered necessary for a fair statement have been included in the accompanying unaudited financial statements.  All intercompany transactions and balances have been eliminated in consolidation.  Operating results for the three-month period ended March 31, 2015 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2015.  The December 31, 2014 balance sheet information has been derived from the Schlumberger 2014 audited financial statements.  For further information, refer to the Consolidated Financial Statements and notes thereto included in the Schlumberger Annual Report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission on January 29, 2015.

New Accounting Pronouncement

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers.  This ASU amends the existing accounting standards for revenue recognition and is based on the principle that revenue should be recognized to depict the transfer of goods or services to a customer at an amount that reflects the consideration a company expects to receive in exchange for those goods or services.  Schlumberger is required to adopt this ASU on January 1, 2017 and does not expect this ASU to have a material impact on its consolidated financial statements.

 

 

2.   Charges and Credits

Schlumberger recorded the following charges and credits in continuing operations during the first quarter of 2015:

·

As a result of the severe fall in activity in North America combined with the impact of lower international activity due to customer budget cuts driven by lower oil prices, Schlumberger decided to further reduce its headcount during the first quarter of 2015.  Schlumberger recorded a $390 million charge during the first quarter associated with this headcount reduction as well as an incentivized leave of absence program.

 

·

During 2014, Venezuela enacted certain changes to its foreign exchange system such that, in addition to the official rate of 6.3 Venezuelan Bolivares per US dollar, there were two other legal exchange rates that could be obtained via different exchange rate mechanisms.  These changes included the expansion of the SICAD I auction rate and the introduction of what was known as the SICAD II auction process.  The SICAD I and SICAD II exchange rates were approximately 11 and 50 Venezuelan Bolivares to the US dollar, respectively, at December 31, 2014.

Although the functional currency of Schlumberger’s operations in Venezuela is the US dollar, a portion of the transactions are denominated in local currency.  Prior to December 31, 2014, Schlumberger had historically applied the official exchange rate to remeasure local currency transactions and balances into US dollars.

Effective December 31, 2014, Schlumberger concluded that it was appropriate to apply the SICAD II exchange rate as it believed this rate best represented the economics of Schlumberger’s business activity in Venezuela.  As a result, Schlumberger recorded a $472 million devaluation charge during the fourth quarter of 2014.

In February 2015, the Venezuelan government replaced SICAD II with a new foreign exchange market system known as SIMADI.  The SIMADI exchange rate was approximately 192 Venezuela Bolivares to the US dollar as of March 31, 2015.  As a result, Schlumberger recorded a $49 million devaluation charge during the first quarter of 2015, reflecting the adoption of the SIMADI exchange rate.  

These changes result in a reduction in the US dollar reported amount of local currency denominated revenues, expenses and, consequently, income before taxes and net income in Venezuela.  For example, if Schlumberger had applied an exchange rate of 192 Venezuelan Bolivares to the US dollar throughout 2014, it would have reduced Schlumberger earnings by approximately $0.09 per share.

8


The following is a summary of these charges:

 

(Stated in millions)

 

 

 

 

Pretax

 

 

Tax

 

  

Net

 

 

Classification

Workforce reduction

$

390

 

 

 

56

 

 

$

334

 

 

Restructuring & other

Currency devaluation loss in Venezuela

 

49

  

 

 

  

  

 

49

  

 

Restructuring & other

 

$

439

 

 

$

56

  

  

$

383

 

 

 

 There were no charges or credits recorded during the first quarter of 2014.

 

3.   Earnings Per Share

The following is a reconciliation from basic earnings per share of Schlumberger to diluted earnings per share of Schlumberger:

 

 

(Stated in millions, except per share amounts)

 

 

2015

 

 

2014

 

 

Schlumberger Net Income

 

 

Average Shares Outstanding

 

 

Earnings per Share

 

 

Schlumberger Net Income

 

 

Average

Shares Outstanding

 

 

Earnings per Share

 

First Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

975

 

 

 

1,276

 

 

$

0.76

 

 

$

1,592

 

 

 

1,306

 

 

$

1.22

 

Assumed exercise of stock options

 

 

 

 

5

 

 

 

 

 

 

 

 

 

 

8

 

 

 

 

 

Unvested restricted stock

 

 

 

 

4

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

Diluted

$

975

 

 

 

1,285

 

 

$

0.76

 

 

$

1,592

 

 

 

1,318

 

 

$

1.21

 

    

The number of outstanding options to purchase shares of Schlumberger common stock which were not included in the computation of diluted earnings per share, because to do so would have had an antidilutive effect, was as follows:

 

(Stated in millions)

 

 

2015

 

 

2014

 

First Quarter

 

16

 

 

 

1

 

 

 

 

4.   Inventories

A summary of inventories follows:  

 

(Stated in millions)

 

 

Mar. 31,

 

 

Dec. 31,

 

 

2015

 

 

2014

 

Raw materials & field materials

$

2,835

 

 

$

2,666

 

Work in process

 

240

 

 

 

273

 

Finished goods

 

1,591

 

 

 

1,689

 

 

$

4,666

 

 

$

4,628

 

 

 

5.   Fixed Assets

A summary of fixed assets follows:

(Stated in millions)

 

 

Mar. 31,

 

 

Dec. 31,

 

 

2015

 

 

2014

 

Property, plant & equipment

$

37,174

 

 

$

36,964

 

Less: Accumulated depreciation

 

22,039

 

 

 

21,568

 

 

$

15,135

 

 

$

15,396

 

 

9


Depreciation expense relating to fixed assets was $827 million and $793 million in the first quarter of 2015 and 2014, respectively.

 

 

6.   Multiclient Seismic Data

The change in the carrying amount of multiclient seismic data for the three months ended March 31, 2015 was as follows:

 

(Stated in millions)

 

 

 

 

 

Balance at December 31, 2014

$

793

 

Capitalized in period

 

101

 

Charged to expense

 

(44

)

Balance at March 31, 2015

$

850

 

 

 

7.   Goodwill

The changes in the carrying amount of goodwill by reporting unit for the three months ended March 31, 2015 were as follows:

 

 

(Stated in millions)

 

 

Reservoir

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Characterization

 

 

Drilling

 

 

Production

 

 

Total

 

Balance at December 31, 2014

$

3,812

 

 

$

8,488

 

 

$

3,187

 

 

$

15,487

 

Acquisitions

 

 

 

 

31

 

 

 

20

 

 

 

51

 

Impact of changes in exchange rates

 

(11

)

 

 

(7

)

 

 

(8

)

 

 

(26

)

Balance at March 31, 2015

$

3,801

 

 

$

8,512

 

 

$

3,199

 

 

$

15,512

 

 

 

8.   Intangible Assets

The gross book value, accumulated amortization and net book value of intangible assets were as follows:

 

 

(Stated in millions)

 

 

Mar. 31, 2015

 

 

Dec. 31, 2014

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Gross

 

 

Accumulated

 

 

Net Book

 

 

Book Value