National Oilwell Varco swings to loss due to impairments
- Business & Finance
U.S. oilfield equipment provider National Oilwell Varco (NOV) sank to a loss during 3Q 2016 due to impairment charges as its revenues halved during the quarter.
On Wednesday, NOV reported a third quarter 2016 net loss of $1.36 billion compared to a profit of $155 million in the corresponding quarter last year.
Excluding other items, net loss for the quarter was $128 million. Other items totaled $1.09 billion, pretax, consisting of a $972 million goodwill impairment and $116 million of other charges primarily associated with severance, facility closures and write-offs of certain assets. Other items, net of tax, totaled $1.23 billion and included a $213 million valuation allowance against foreign tax credits.
The company’s revenues dropped by 50% during 3Q 2016 totaling $1.65 billion, compared to revenues of $3.3 billion in the same period last year.
As of September 30, 2016, the company had $1.51 billion in cash and cash equivalents and total debt of $3.22 billion, a decrease of $64 million from June 30, 2016.
In related news, NOV is buying a global provider of processing technology, systems and services to the upstream oil and gas industry, Fjords Processing, from Akastor. NOV explained in its financial report that the acquisition provides technology that is complementary to NOV’s Process and Flow Technology Business Unit, which provides production and process solutions.
Offshore Energy Today Staff