HOUSTON--(BUSINESS WIRE)--Apr. 11, 2016--
National Oilwell Varco, Inc. (NYSE:NOV) announced today that its Board
of Directors has approved a plan to reduce the Company’s quarterly
dividend to $0.05 per share in response to market conditions which
continued to deteriorate through the first quarter of 2016.
Clay Williams, Chairman, President and CEO, commented, “We believe
reducing the dividend is in the best interest of our company and our
shareholders as we continue to work our way toward the bottom of this
severe down cycle. Substantial decreases in 2016 E&P capital plans are
driving activity levels to new record lows, resulting in significantly
diminished demand for equipment and services.
“Based on preliminary information, first quarter revenues will be down
approximately 20% from the $2.7 billion recognized in the fourth quarter
of 2015. Importantly, although the near-term outlook remains
challenging, NOV remains strong financially. NOV’s total debt decreased
by over $500 million during the first three months of 2016 and the
decision to reduce the dividend is expected to improve future net cash
flow by approximately $615 million per year.
“We believe the dramatic reductions in capital spending are accelerating
global production declines, setting the stage for a recovery in demand
for NOV equipment and technologies. Reducing our dividend will allow us
to preserve capital to invest in future growth opportunities and enhance
the core capabilities our customers will need when industry activity
National Oilwell Varco is a worldwide leader in the design, manufacture
and sale of equipment and components used in oil and gas drilling and
production operations and the provision of oilfield services to the
upstream oil and gas industry.
Statements made in this press release that are forward-looking in nature
are intended to be “forward-looking statements” within the meaning of
Section 21E of the Securities Exchange Act of 1934 and may involve risks
and uncertainties. These statements may differ materially from the
actual future events or results. Readers are referred to documents filed
by National Oilwell Varco with the Securities and Exchange Commission,
including the Annual Report on Form 10-K, which identify significant
risk factors which could cause actual results to differ from those
contained in the forward-looking statements.
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Source: National Oilwell Varco, Inc.
National Oilwell Varco, Inc.
Jose Bayardo, 713-375-3700