Varco Cites Cuts in Drilling for Drop in Annual Profit : Earnings: The maker of oil and gas well equipment posted a net of $2.4 million, down from $14 million in 1991.

Varco International Inc. reported Thursday that its earnings fell to $2.4 million last year from $14 million for 1991. Annual revenue declined $173.1 million from $216.6 million.

George Boyadjieff, president and chief executive of the oil-industry service company, linked the income drop to “further retrenchment” in the business and a pair of onetime expenses. During the third quarter, Varco, which is based in Orange, closed a manufacturing plant in Houston and reported a charge to income of about $4.9 million. And during the fourth quarter, the company recorded a $2-million income tax credit that reflected a mandated change in the way that future tax benefits are recorded.

For the final three months of the year, Varco’s profit fell 14% to $3 million from $3.5 million for the same period a year earlier. Fourth-quarter revenue slipped 12% to $50.5 million from $57.4 million.

For most of the oil industry, 1992 was “a year of reduced drilling activity,” Boyadjieff said. “We at Varco were not immune to that trend.” Varco, which designs and manufactures oil and gas well drilling and monitoring equipment, instituted “aggressive cost-reduction activities” that left the company “better positioned today to take advantage of any upturn in industry activity,” he said.

Incoming orders totaled $178.5 million for 1992, up from $171.4 million for 1991. Varco’s year-end order backlog was about $40.4 million.