The Rising Influence of Rising Affluence

[DewDiligence]

CLB/SLB curiosity item: on CLB’s 1Q12 CC, an analyst asked whether CLB considered SLB a direct competitor. (To my knowledge, no one had ever asked this before on a CLB CC.) The exchange:

http://seekingalpha.com/article/511311-core-laboratories-ceo-discusses-q1-2012-results-earnings-call-transcript?part=qandaanswer:

James West (Barclays): David, Schlumberger recently made an announcement that they were opening a new core-analysis center in Houston, and it seems like they make it a push towards your business… Are you seeing at this point increased competition or is this just because the markets growing so rapidly and customers are demanding this that it's kind of pulling the bigger guys into your business?

David Demshur (CEO): …we did see in [SLB’s] announcement…it was about a 30,000 square foot facility. We see [this as] a logical extension of their purchase of TerraTek, which was, I think, about a decade ago… And remember their focus: they are an exploration-oriented company, where we are a development and production oriented company.

So, a little different focus on the facility, 30,000 square foot lab here in Houston compared to what we are adding right now: over 40,000 square feet to total 300,000 square feet here in Houston alone. So, we understand that they are in the business. As of yet we have not seen any increase in competition because we think it's a little bit of a different market focus.

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