My fellow nov people, while the poor get poorer, we will soon join, management disregards anything other than their own selfish agenda. They say layoffs will happen next week or early October. Screw these people.
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The Oracle implementation was a joke...
Two projects put GP in the crosshairs: 1) Titan Weld line and 2) Oracle implementation.
Along with repairs, their capital spending is historically not in GP’s favor on top of having aging equipment and moving stuff around the world.
Then you had Vallourec which was purchased to gain market share. In hindsight, it would have been better to let them take themselves down and then not spend the money nor deal with French labor laws.
Management running into the ground is a bit of a misstatement. Many of the decisions above were made by different people in different markets. In 2013 you’d experiment with trying to put larger pipe in the offshore market. These decisions that are sinking NOV now are in some cases over a decade in the making.
When you are a manufacturing company, all carrying value will help and hurt you.
At year end, you want to have as little on hand for property tax reasons; that being said if orders pick up immediately in a normal environment, your lead times get extended and you can lose the order to a competitor which in this case includes pipe from China which isn’t as reliable.
I feel really bad for the people doing the work there, but the plant managers in the past and their management have run that place into the ground and spent money in dumb fashion for decades. It was a long time coming.
Q3 numbers will be horrendous. You can expect mass reductions throughout all business units.