SLB (Schlumberger Limited) — FY 2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022; the filing also reports fourth-quarter results. The registrant’s legal name remains Schlumberger Limited, although it adopted the SLB brand in 2022.
Business context and financial performance
SLB is a global energy technology and oilfield services company operating in more than 100 countries. Its four divisions are Digital & Integration, Reservoir Performance, Well Construction, and Production Systems. International operations generated approximately 78% of 2022 revenue.
| Metric | 2022 | 2021 |
|---|---|---|
| Revenue | $28.091 billion | $22.929 billion |
| Income before taxes | $4.271 billion | $2.374 billion |
| Net income attributable to SLB | $3.441 billion | $1.881 billion |
| Diluted earnings per share | $2.39 | $1.32 |
| Cash flow from operations | $3.720 billion | $4.651 billion |
| Free cash flow* | $1.418 billion | $2.997 billion |
| Net debt | $9.332 billion | $11.056 billion |
*Company-defined non-GAAP measure: operating cash flow less capital expenditures, APS investments, and capitalized exploration data costs. Full-year revenue grew 23%; management reported an 18% pretax operating margin, up 316 basis points.
Fourth-quarter results and segment trends
Q4 revenue was $7.879 billion, up 5% sequentially; pretax segment operating income was $1.557 billion and pretax segment operating margin reached 19.8%, the highest since 2015. Revenue increased across all divisions and geographic areas. International revenue was $6.2 billion, up 5% sequentially, and North American revenue was $1.6 billion, up 6%.
For full-year 2022, all divisions grew revenue: Digital & Integration $3.725 billion (+13%), Reservoir Performance $5.553 billion (+21%), Well Construction $11.397 billion (+31%), and Production Systems $7.862 billion (+17%). Well Construction had the largest margin expansion; Production Systems’ margin was essentially flat, with logistics costs and mix cited as pressures.
Cash, debt, and liquidity
Cash and short-term investments totaled $2.894 billion at year-end. Total debt carrying value was $12.226 billion, including $1.632 billion due within one year; net debt fell $1.724 billion during 2022. SLB repaid approximately $1.65 billion of long-term debt and repurchased $804 million face value of notes for $790 million. It reported $6.55 billion of committed credit facilities available and unused, and said liquidity plus operating cash generation would meet requirements for the next 12 months and beyond.
Operating cash flow declined about $0.9 billion year over year, chiefly because working capital used $1.709 billion, including increases in receivables and inventories. Capital investments were $2.302 billion. Dividends paid were $848 million; no shares were repurchased in 2022.
Outlook, commentary, and notable items
- Management expected another year of very strong growth and margin expansion in 2023, citing broad-based activity growth, improving pricing, tight industry capacity, and accelerating international activity. No specific consolidated revenue or earnings guidance was provided.
- 2023 capital investments were expected to be approximately $2.5–$2.6 billion. Management projected Transition Technologies revenue would exceed $1 billion in 2023.
- The quarterly dividend was increased 40% in April 2022 and a further 43% in January 2023; SLB resumed share repurchases in Q1 2023.
- 2022 included $347 million of net pretax credits in “Interest & other income,” including gains on Liberty share sales, an ADC investment, and real estate, partly offset by a $139 million Argentina Blue Chip Swap loss. These items affected reported earnings; assess results excluding them.
- SLB suspended new investment and technology deployment in Russia in March 2022. Russia accounted for about 6% of 2022 revenue; year-end net assets there were approximately $0.7 billion.
- A proposed subsea joint venture with Aker Solutions and Subsea 7 was expected to close in the second half of 2023, subject to approvals. SLB expected to own 70% at closing.
- Key risks include oil and gas customer spending and price cycles, geopolitical disruption and sanctions, energy-transition execution, cybersecurity, foreign exchange, inflation and supply-chain constraints, environmental regulation, and operational or well-control incidents. Management considered material loss from pending legal proceedings remote. The auditor issued an unqualified opinion; uncertain tax positions were identified as a critical audit matter.
Important facts for investors to verify
- Whether 2023 growth and margin expansion materialized, particularly in international and Middle East markets, and whether pricing gains offset cost inflation.
- Whether working-capital demands normalize and operating cash flow improves alongside revenue growth.
- Underlying earnings after separating the $347 million net pretax credits and other investment-related gains and losses.
- Russia exposure, Argentina currency restrictions and potential further swap losses, and progress and terms of the proposed subsea joint venture.
- Execution and revenue contribution of digital, Transition Technologies, and New Energy initiatives, alongside the stated emissions targets.