Lower commodity prices weren’t enough to slow business at National Oilwell Varco Inc. (NOV), which reported a growing backlog of capital equipment orders and increased quarterly earnings compared with 2Q2011.

Backlog for capital equipment orders for NOV’s rig technology segment was $11.28 billion on June 30, a 46% increase compared with the end of 2Q2011. During 2Q2012 the segment booked $2.73 billion of new capital equipment orders through a combination of $2.22 billion in new orders and $510 million in orders through acquisitions completed during the quarter, NOV said.

Net income jumped to $605 million ($1.42/share) in 2Q2012, a 26% increase compared with $481 million in 2Q2011. Revenues were $4.7 billion, up 10% from 1Q2011 and 35% higher than in the year-ago period. Operating profits jumped 27% to $907 million.

NOV’s 2Q2012 book-to-bill ratio came in at 1.50, still well below the 2.00+ ratios turned in during the first three quarters of 2011, but a second consecutive quarterly sequential improvement. The ratio stood at 0.94 in 4Q2011 and 1.12 in 1Q2012.

The book-to-bill ratio for NOV represents the amount of additions to the backlog divided by the amount of revenue that was booked from backlog during that same period. While the ratio itself will not explain 100% of the changes in backlog from period to period, because it does not incorporate things such as turns business (orders taken and filled in the same period), cancellations and order push-outs, book-to-bill ratios above 1.00 generally indicate that backlog grew during the measurement period.

“The company continues to expand organically as well as through acquisitions,” said NOV CEO Pete Miller. “We closed six transactions during the quarter for total consideration of $2 billion, to strengthen the technology, product and service offerings we provide our oil and gas customers around the globe. Most markets we serve have remained buoyant, despite lower commodity prices, and we therefore expect solid results for the second half of the year.”

Rig technology, the company’s largest and most profitable segment, reported $2.41 billion of revenue in 2Q2012, a 27% increase from $1.89 billion in 1Q2011. Excluding results from two acquisitions closed during the quarter, sales increased 2%, NOV said. Analysts keep an eye on the rig technology segment because in general it lags behind the commodity price cycle by a few quarters, which reflects the timing of its supply backlog.

Revenues in the petroleum services unit jumped 31% y/y to $1.78 billion in the latest quarter, which NOV attributed to “higher sequential sales in the U.S. and modest growth in international markets, [which] were partly offset by second quarter seasonal declines in Canada.”

In the distribution services segment, quarterly revenues reached $780 million, which was 84% higher y/y, due mostly to one-month’s contribution of Wilson Supply, which NOV acquired from Schlumberger Ltd. during the quarter.

Analysts with Tudor, Pickering, Holt & Co. called NOV’s 2Q2012 results solid and said the company’s $2.73 billion in new orders was “impressive.” NOV appears ready for a strong second half of 2011, “despite macro volatility,” the analysts said.

It was the latest in a series of positive quarterly earnings reports for Houston based-NOV, which designs, manufactures and sells an array of equipment for oil and gas drilling and production operations in the onshore and offshore (see Shale Daily, April 26; Feb. 3; Oct. 26, 2011; July 27, 2011).