Core Laboratories NV CLB

Core Laboratories reported first-quarter revenue down 5% sequentially, with adjusted operating margins slipping to 11% from 11.5% in the prior quarter. The revenue decline was driven by a 9% drop in the reservoir description segment, while the production segment saw a 7% increase. A modest seasonal dip in revenue for the reservoir segment is typical, though this quarter, Core Lab was also adversely affected by the disruption to its U.S. Gulf Coast laboratory operations owing to severe winter weather. Our fair value estimate and wide moat rating are unchanged following the results.