HOUSTON – Schlumberger NV trimmed its workforce by about 2,500 people in the first quarter as the company’s profit slumped 49 per cent amid the continuing slump in oil and gas drilling.
The company said in a news release that its workforce, which started the year at 95,000, ended the first quarter on March 31 with 93,000 employees. It had 126,000 employees in mid-2014, when oil prices started to drop.
A Schlumberger spokesman said Friday that the company cut about 8,000 employees but converted about 5,500 contractors to employees in the first quarter for a net loss of 2,500 jobs. He said the company rounded the current-workforce number up to 93,000 in the news release.
The spokesman declined to describe the cuts by location.
On Thursday, Schlumberger announced that first-quarter net income fell to $501 million, or 40 cents per share, from $975 million, or 76 cents per share, a year earlier.
Revenue fell 36 per cent to $6.52 billion from $10.25 billion. Revenue in North America plunged by 55 per cent and international revenue dropped 28 per cent from a year ago.
The company, with bases in Paris, Houston, London and The Hague, Netherlands, is the world’s largest oilfield-services provider, helping energy companies explore for and produce oil and gas. The business has sagged with the plunge in oil prices that started in mid-2014.
Chairman and CEO Paal Kibsgaard said Schlumberger is dealing with a decline in activity, pressure to cut prices, and job cancellations. The decline in drilling activity “reached unprecedented levels as the industry displayed clear signs of operating in a full-scale cash crisis,” he said in a statement issued by the company after U.S. markets closed on Thursday.
In afternoon trading on Friday, the shares were down 30 cents to $79.97. They began the day up 15 per cent in 2016 but were still down 32 per cent from their peak in July 2014.