Superior Energy Services Inc. (SPN), the oilfield contractor whose market value has doubled in the past five years, is looking to increase its presence in Brazil, Saudi Arabia, Indonesia and Australia, places it sees as less risky international markets.
Superior, which has acquired companies in Colombia and Argentina, is looking to profit from expanded international spending by energy producers, Chief Executive Officer David Dunlap said in an interview at his Houston office yesterday. Purchases would likely be less than $100 million, he said.
Superior’s sales outside of the U.S. increased in the first three quarters of the past year, growing from 17 percent to 19 percent of total revenue. Dunlap said revenue in 2013 was “just under” $1 billion from international markets. Exploration and production companies are expected to boost spending outside the U.S. and Canada by 6 percent to a record $524 billion this year, Barclays Plc said in a December report.
“We’re still in the early days of building out the international business,” said Dunlap. The Houston-based company will avoid markets in China, Russia and Mexico, he said. “I’d like to not get exposed to some of those riskier places from a margin and return standpoint early on and instead pick places that we feel are more confident in return and margin growth.”
Superior also owns Wild Well Control, a business that brings workers in to handle on-site emergencies at oil and natural gas fields. Its employees were sent last week to a gas well in Pennsylvania after Chevron Corp. reported a fire that injured one worker and left another missing.
“We don’t talk about this a whole lot,” Dunlap said of the business. Good business results for the unit depend on a customer’s disaster, he said.
Last year saw the highest number of well blowouts in the Gulf of Mexico since at least 2006, according to the U.S. Bureau of Safety and Environmental Enforcement, which oversees offshore drilling.
“The geohazard challenge didn’t go away, and I think it gets underestimated at times,” said Dunlap, who was chief operating officer at BJ Services Co. when it was acquired by Baker Hughes Inc.
Superior gained 2.8 percent to close at $27.08 yesterday in New York, giving the company a market capitalization of $4.32 billion. The shares, which traded as high as $57.25 in 2008, have more than doubled from a low of $11.52 in the aftermath of the financial crisis.
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