Schlumberger Ltd SLB is expected to lay off thousands of more personnel before the year ends, per a Form 8-K filing with the U.S. Securities and Exchange Commission on Dec 1.
Per the filing, Schlumberger is anticipated to incur pre-tax restructuring charges of $350 million from further retrenchment of its workforce. However, the form does not specify the exact number of job cuts.
Schlumberger had incurred pre-tax restructuring charges of $390 million in the first quarter of 2015 pursuant to 11,000 job cuts.
Taking the earlier reported restructuring charge figures into consideration, it can be induced that the anticipated job cuts before the end of fourth-quarter 2015 will be in the same range.
Per the SEC filing, the company expects a longer period of low oil prices that would further reduce drilling activity as well as intends to reorganize itself.
The reshuffling may result in termination of back office functions owing to Schlumberger's acquisition of Houston-based Cameron International for $14.8 billion. As observed in Aug 2015 by a partner responsible for energy investments at Houston-based Chilton Capital Management, when any two corporate offices join in Houston, various operations jobs are reassessed.
Schlumberger had last reported a reduction in headcount at the end of the first quarter of 2015, which totaled 20,000. This is the second-highest number of job cuts since the company's peak in 2014.
Schlumberger did not disclose any further details with respect to its filing.
Schlumberger carries a Zacks Rank #5 (Strong Sell). Some better-ranked players from the broader energy sector are Energy Transfer Equity, L.P. ETE, ReneSola Ltd. SOL and Boardwalk Pipeline Partners, LP BWP. Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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