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Barclays CEO Energy-Power Conference
Paal Kibsgaard
We plan to continue improving our performance by working toward the following
high-level goals.
First, in 2011 and 2012 we posted growth in earnings per share of 38% and 16%, respectively,
on a pro-forma basis. In the years ahead, our overriding goal will be to continue
generating double-digit growth in earnings per share. In support of this target, we expect
continued growth in E&P spend, driven by the complexity of new oil and gas developments
and the need for further investment to offset the decline in the mature production base.
We further aim to fuel our growth through market share gains, driven by the competitive
strength of our individual product lines; by our ability to introduce new products
and services; by augmenting our technology portfolio where possible; and by further
leveraging our unique integration capabilities.
Second, in the past couple of years we have shown steady improvement in operating
margins, and building on this, we have a clear ambition of bringing margins back to
the levels of the previous cycle. In order to achieve this goal, we will count on some
improvement in general pricing, but also on significant contributions from the
introduction of new technology, improvements in operational efficiency, reduction in
cost of ownership of our field assets, and lower unit support costs.
Third, we will continue to focus on improving return on capital and free cash flow from
our operations to fuel the return of cash to our shareholders, both in terms of stock
buy-backs and dividends.
In just the first half of 2013 we generated roughly two-thirds of all the free cash flow
generated in 2012. We now aim to build on this improvement by continuing to lower the
capex intensity of our business as well as our consumption of working capital through
the transformation programs I have already outlined. These ambitions today permeate
our entire organization and are also built into our incentive programs.
All of these endeavors, together with our proven execution capabilities, give me confidence
in our ability to deliver on our potential going forward.
