NOI Natl Oilwell

By Austen Hufford 

National Oilwell Varco Inc. cut its dividend by 89%, as the maker of drilling equipment and provider of oil-field services moves to preserve capital amid a sustained decline in energy prices.

The company also said it expects its first-quarter revenue to decline by about 20% sequentially from the prior quarter's revenue. Analysts were expecting a roughly 12% sequential decline. The revenue drop would be about 55% from same quarter a year earlier.

National Oilwell Varco's quarterly dividend will fall to five cents a share from 46 cents per share previously. The dividend reduction will increase its net cash flow by about $615 million a year.

The company said it remains strong financially despite "significantly diminished" demand for its equipment and services.

Earlier this month the company said that mass layoffs in its Norwegian unit would continue even after the company shed half its workforce there. Over the past year National Oilwell Varco shed 1,800 permanent jobs and 600 contractors in Norway amid weaker activity in the North Sea.

Shares of the company were inactive premarket. They have fallen 47% in the past 12 months.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

April 11, 2016 07:47 ET (11:47 GMT)

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