This first-quarter 2017 earnings release, as well as other statements we make, contain “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts, such as our forecasts or expectations regarding business outlook growth for Schlumberger as a whole and for each of its segments (and for specified products or geographic areas within each segment) oil and natural gas demand and production growth oil and natural gas prices improvements in operating procedures and technology, including our transformation program capital expenditures by Schlumberger and the oil and gas industry the business strategies of Schlumberger’s customers the anticipated benefits of the Cameron transaction the success of Schlumberger’s joint ventures and alliances future global economic conditions and future results of operations. The following is a reconciliation of these non-GAAP measures to the comparable GAAP measures.
The foregoing non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP. These measures are also used by management as performance measures in determining certain incentive compensation. Management believes that the exclusion of charges & credits from these financial measures enables it to evaluate more effectively Schlumberger’s operations period over period and to identify operating trends that could otherwise be masked by the excluded items. Net income, excluding charges & credits, as well as measures derived from it (including diluted EPS, excluding charges & credits net income before noncontrolling interests, excluding charges & credits and effective tax rate, excluding charges & credits) are non-GAAP financial measures.
In addition to financial results determined in accordance with US generally accepted accounting principles (GAAP), this First-Quarter 2017 Earnings Release also includes non-GAAP financial measures (as defined under the SEC’s Regulation G).
The offshore revenue decline was a result of lower WesternGeco multiclient license sales following the usual, but muted, year-end sales in the previous quarter, although this was partially offset by Wireline revenue growth from infrastructure-led exploration activity. While land revenue in the US posted double-digit growth on a 27% sequential rig count increase, revenue in Western Canada grew stronger from a winter ramp-up in activity as sequential rig count increased by 56%. Land revenue experienced double-digit sequential growth driven by: stronger hydraulic fracturing activity as stage count increased higher pricing as capacity utilization improved greater uptake of directional drilling products and services as the rig count grew and higher Cameron revenue as product sales and fracturing and flowback rental activity increased. In North America, revenue grew sequentially as unconventional land activity accelerated during the quarter, partially offset by a decline in offshore activity.
As we continue to carefully navigate the current industry landscape, we remain confident and optimistic about the future of Schlumberger, knowing very well that beyond the current market challenges lies a wealth of opportunity for the industry players who are ready and able to think new and to act new.” In parallel, we are constantly looking to expand our opportunity set by pursuing a broad and active M&A program engaging with existing and new customers to establish closer collaboration and more aligned business models and expanding our offering from technical support to investing alongside our customers in their projects-all with the aim of driving more activity for our 19 product and service lines. We are doing this by proactively managing our base business and responding to the ongoing pressures of commoditization, tailoring our offering and performance to the prevailing market conditions. “At Schlumberger, we are therefore actively seeking to position the company at the forefront of an industry that needs to evolve.