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Core Laboratories (CLB) Reports Q3 EPS of $0.48

October 23, 2017 5:19 PM EDT

Core Laboratories (NYSE: CLB) reported Q3 EPS of $0.48, versus $0.38 reported last year. Revenue for the quarter came in at $166.25 million, versus $143.48 million reported last year.

Fourth Quarter 2017 Revenue and EPS Guidance

Core is encouraged by the increasing focus of its major clients regarding capital management, ROIC, FCF and returning capital back to their shareholders, as opposed to just production growth. The Companies adopting these metrics tend to be the more technologically sophisticated operators and form the foundation of Core’s worldwide client base. Core will benefit from this shift in focus from production growth to employing higher technological solutions to maximize economic production growth and EURs. The client’s increased use of higher technological solutions from Core is considered in the Company’s guidance for continued increases in operating and incremental operating margins into the fourth quarter of 2017. Clients will pay for technologies that boost their ROIC and FCF.

Internationally, a number of Final Investment Decisions ("FIDs") have been announced during the quarter by oil and gas companies; however, activities for Core Lab relating to those FIDs are not expected to materially increase in 2017 as the operators are currently developing their project plans and should begin to implement those plans early in 2018. Further, the international rig count remains flat due to limited capital projects underway by international operators. However, operators continue to spend from their operating budgets on maximizing recovery from their existing producing fields.

Core expects fourth quarter 2017 North American completion activity levels to continue to expand as current completion levels will be supplemented by reductions in drilled-but-uncompleted ("DUC") inventories. The Company expects fourth quarter 2017 international activity levels to be flat to up slightly from third quarter levels with most ongoing projects to be funded largely from their operating budgets.

Core projects fourth quarter 2017 revenue of approximately $171,500,000. As discussed in prior quarterly earnings releases, Core expects our incremental operating income margins to exceed 60% as the recovery phase continues, followed by historical incremental operating income margins of approximately 35% to 45%. The Company projects that its operating income in the fourth quarter 2017 is expected to be approximately $32,800,000 yielding operating margins of approximately 19%. EPS for the fourth quarter 2017 is expected to be approximately $0.58.

Fourth quarter 2017 FCF is expected to exceed net income and Core expects that it will continue to return all excess capital to its shareholders during the quarter.

For earnings history and earnings-related data on Core Laboratories (CLB) click here.



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