Financial Data and Key Metrics Changes - Revenue from continuing operations was $108.4 million in Q1 2021, down approximately 4.7% from $113.7 million in the prior quarter, primarily due to seasonal decline and international operational challenges [20][21] - Service revenue was $84 million, down approximately 6% sequentially from $89.2 million, affected by seasonal declines and COVID-related disruptions [21] - Product sales were $24.4 million, relatively flat from the previous quarter, with international product sales slightly up [22] - Income from continuing operations, excluding items, was $7 million, down approximately 14% sequentially from $8.1 million [28] - Free cash flow for the quarter was $5.2 million, marking another quarter of positive free cash flow [34][35] Business Line Data and Key Metrics Changes - Reservoir Description revenue was $76.5 million, down nearly 9% compared to Q4, impacted by seasonal factors and international travel complications [45] - Production Enhancement revenue was $31.9 million, up 7% sequentially despite the winter storm's negative impact [53] Market Data and Key Metrics Changes - The U.S. land market showed signs of recovery, with significant growth as the quarter ended, despite being negatively impacted by the winter storm [20][22] - International operations faced challenges due to travel restrictions and logistical issues, but there is optimism for recovery in international markets [13][39] Company Strategy and Development Direction - The company focuses on maximizing free cash flow, return on invested capital, and returning excess cash to shareholders [12] - Core Laboratories aims to introduce new technologies and maintain a strong pipeline for technological offerings in both Reservoir Description and Production Enhancement [13][37] - The company is optimistic about international growth opportunities, particularly in regions like Turkey, Mexico, and Qatar [38][39] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing challenges from the pandemic but expressed optimism for recovery in oil and gas demand throughout 2021 [9][10] - The company anticipates improving market conditions and expects Reservoir Description revenue to increase mid-to-high single digits sequentially in Q2 2021 [40] - Incremental margins may be softer in the near term due to reinstating employee compensation, but historical margin performance is expected to return [41] Other Important Information - The company reduced net debt by $65 million in Q1 2021, improving the leverage ratio to just over 2.3 [17][31] - The company has a strong liquidity position with $214 million available under its credit facility [17] Q&A Session Summary Question: Thoughts on medium- to long-term revenue targets for Reservoir Description - Management indicated it is too premature to provide a quarterly revenue run rate due to uncertainties in client project progress [61] Question: Capital allocation and leverage targets - The target leverage ratio is 1.5x, with a focus on reducing debt while potentially increasing R&D spending [64][65] Question: Expectations for Q2 and Q3 incremental margins - Management expects incremental margins to be lower in the near term due to reinstating compensation, with a return to historical levels anticipated later [68] Question: Insights on deepwater projects and activity levels - Management noted that while there are delays due to COVID, there are no project cancellations, and they see ongoing opportunities in deepwater regions [78] Question: Impact of gas versus oil project mix on revenue and margins - Management stated that while oil projects tend to be higher value, gas projects still require significant analysis, and the mix does not drastically change revenue or margin outlooks [81]

Financial Data and Key Metrics Changes - Revenue from continuing operations for Q4 2020 was $113.7 million, an increase of approximately 8% from $105.4 million in the prior quarter. For the full year 2020, revenue was $487.3 million, a decrease of 27% from $668.2 million in 2019 [31][32]. - Core Laboratories generated $46 million in free cash flow in 2020, marking the 19th consecutive year of positive free cash flow [18][55]. - The company reduced net debt by approximately $49 million from the end of 2019 to the end of 2020 [15][24]. Business Line Data and Key Metrics Changes - Service revenue for Q4 2020 was $89.2 million, up over 3% sequentially from $86.3 million last quarter [32]. - Product sales for Q4 2020 were $24.6 million, an increase of over 28% from $19.1 million last quarter, with U.S. market product sales up 44% sequentially [34]. - EBIT for Q4 2020, excluding items, was $13 million, representing a best-in-class EBIT margin of over 11% [39]. Market Data and Key Metrics Changes - U.S. land activity improved sequentially from Q3 to Q4 2020, benefiting Core Laboratories from an uptick in well completions [12]. - The company anticipates lower client activity in Q1 2021 due to seasonality, projecting a decline in revenue by mid-single-digits [61]. Company Strategy and Development Direction - Core Laboratories will continue to focus on maximizing free cash flow, return on invested capital, and returning excess free cash to shareholders [17][57]. - The company is committed to introducing new technologies and maintaining a strong collaborative relationship with its clients to address industry needs [21][60]. - Core Laboratories aims to reduce its leverage ratio below 1.5, with a target to achieve this by the end of 2022 [96][98]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in client activity anticipated in 2021, particularly in the U.S. land market and international projects [20][60]. - The company noted that while COVID-19 disruptions present uncertainties, they expect activity levels to improve in the second half of 2021 [65]. - Management highlighted the importance of maintaining a disciplined cost structure aligned with client activity levels [19][114]. Other Important Information - The company issued $60 million in new senior notes in January 2021 to refinance a portion of its long-term debt [25][47]. - Core Laboratories' DSO (Days Sales Outstanding) for Q4 2020 was 62 days, a significant improvement from 68 days in the prior quarter [43]. Q&A Session Summary Question: What drove the 65% increase in energetic sales quarter-on-quarter? - Management indicated that both market share shifts and increased completions activity contributed to the strong bounce in energetic sales [85][86]. Question: Can you explain the seasonality affecting Q1 revenue? - Management noted that Q1 typically sees a decline in revenue due to clients wrapping up budgets and projects from the previous year, compounded by COVID-19 uncertainties [90][91]. Question: What is the target for deleveraging? - The company aims to reduce its leverage ratio below 1.5, with a goal to achieve this by the end of 2022, depending on market conditions [96][98]. Question: How does the company view the recovery in international markets? - Management expressed caution but acknowledged the potential for double-digit growth in the second half of 2021, particularly as OPEC increases production [100][101]. Question: What are the expectations for CapEx in 2021? - Management indicated that CapEx for the first half of 2021 would be around $6 million, with potential increases in the second half depending on market conditions [117][120].

Financial Data and Key Metrics Changes - Revenue from continuing operations was $105.4 million in Q3 2020, down approximately 9% from $115.7 million in the prior quarter, primarily due to a 16% decrease in international project revenue and product sales [25][19] - Free cash flow in Q3 was $18.5 million, marking the 76th consecutive quarter of generating positive free cash flow [37][38] - Net debt was reduced by $16.2 million during the third quarter, bringing total net debt to $251 million [36][19] Business Line Data and Key Metrics Changes - Service revenue was $86.3 million for the quarter, down from $91 million, reflecting a 5% sequential decline, impacted by delays on international projects due to COVID-19 [25][26] - Product sales for the quarter were $19.1 million, a decrease of 23% from $24.7 million last quarter, although U.S. product sales were up 32% sequentially [29][25] - EBIT ex-items for the quarter was $12.3 million, up from $10.7 million last quarter, representing EBIT margins of 12% [32] Market Data and Key Metrics Changes - The U.S. land market saw a revenue increase of over 21% compared to the second quarter, while international activities faced disruptions [25][11] - The company expects low to mid-single digit sequential improvement in both revenue and operating income for Q4 2020, driven by a gradual recovery in U.S. land activity [42][40] Company Strategy and Development Direction - Core Laboratories focuses on maximizing free cash flow, maximizing return on invested capital, and returning excess free cash to shareholders [13][12] - The company is committed to introducing new technologies and maintaining a strong pipeline for technological offerings to address industry needs [17][12] - Core is strategically positioned to benefit from the anticipated shift towards international conventional reservoirs as the next investment cycle [68][67] Management's Comments on Operating Environment and Future Outlook - Management noted that while there are headwinds due to COVID-19 and operational disruptions, there are signs of subtle improvement in operational activity in some regions [11][12] - The company anticipates that international projects will continue, but the pace of recovery remains uncertain [40][39] - Management expressed optimism about the gradual improvement in U.S. land activity and expects to generate positive free cash flow in Q4 2020 [44][42] Other Important Information - The company entered an agreement to issue $60 million in senior notes to improve liquidity and manage corporate debt structure [20][21] - Core Laboratories is involved in the CarbonNet project in Australia, which focuses on carbon capture and storage [46][47] Q&A Session Summary Question: Trends in production enhancement and pricing pressure - Management indicated that Core Lab is well-positioned to respond to both components and preassembled guns, with a focus on the Oriented GoGun technology [55] Question: Carbon capture and Core Lab's role - Management emphasized that Core Lab provides essential laboratory measurements for carbon capture projects, aligning with client needs in this area [59][61] Question: International spending cycle outlook - Management believes the next investment cycle will focus on international conventional reservoirs, with Core Lab well-positioned to capitalize on this shift [68][67] Question: Implications of conventional reservoirs on margins - Management expressed optimism about achieving margins above 20% as activity returns to higher levels [71] Question: Cost structure alignment with client activity - Management clarified that while heavy lifting in cost structure adjustments has been completed, ongoing evaluations for efficiency improvements continue [84] Question: U.S. completion activity recovery timeline - Management expects a gradual recovery in completion activity, likely extending into the second quarter of the following year [86]

Financial Data and Key Metrics Changes - Revenue from continuing operations was $115.7 million in Q2 2020, down approximately 24% from $152.4 million in the prior quarter [22] - Free cash flow generated was almost $24 million, marking the 75th consecutive quarter of positive free cash flow [11][30] - Net debt was reduced by approximately $23 million, ending the quarter with a leverage ratio of 2.21 [18][29] - Income from continuing operations excluding items was $6.1 million, down 55% sequentially from $13.7 million last quarter [27] Business Line Data and Key Metrics Changes - Service revenue was $91 million for the quarter, down from $110 million last quarter, impacted by a significant decrease in drilling and completion of U.S. onshore wells [22] - Product sales were $24.7 million, a decrease of 42% from $42.4 million last quarter, with U.S. onshore market sales down over 60% [23] - Cost of services for the quarter was 74% of service revenue, consistent with the prior quarter, while cost of sales was 96% of revenue, up from 81% last quarter [24] Market Data and Key Metrics Changes - North America experienced a sharper decline of 44% in revenue compared to a 10% decrease in international revenue [22] - International activity is projected to be down approximately 10% to 15% year-over-year [35] - The company expects delays in project work and international shipment of projects to improve somewhat during the second half of 2020 [35] Company Strategy and Development Direction - Core Laboratories focuses on maximizing free cash flow, maximizing return on invested capital, and returning excess free cash to shareholders [10] - The company is committed to introducing new technologies and maintaining a strong internal pipeline for technological offerings [13] - Cost reduction initiatives are expected to benefit future financial performance significantly, with projected savings of over $9.3 million per quarter for Reservoir Description and over $5.9 million for Production Enhancement [37] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by COVID-19, including reduced oil demand and operational disruptions [9] - There is cautious optimism for recovery in client activity as economies emerge from COVID-19-related restrictions [34] - Management expects that the cost reductions implemented will benefit financial performance in both segments moving forward [37] Other Important Information - The company executed an amendment to its revolving credit facility, increasing the maximum leverage ratio permitted from 2.5x to 3x through June 30, 2021 [18] - The company recorded charges of $13.3 million in Q2, primarily associated with inventory write-downs and severance [21] Q&A Session Summary Question: How do RD margins progress in the second half? - Management indicated that while current margins are strong, future margins could see fluctuations due to operational activity volatility [47][49] Question: Can you help size the impact of budget reductions versus COVID disruptions? - Management noted that most of the recent revenue shifts were largely COVID-19 related, with capital budget adjustments expected to manifest over a longer term [52][55] Question: What is required for Production Enhancement to reach breakeven margins? - Management stated that a slight improvement in activity could lead to breakeven EBIT, but sustained activity recovery is necessary [70][72] Question: Can you quantify the incremental benefit of cost savings moving forward? - Management explained that cost reductions were implemented earlier in Reservoir Description, while Production Enhancement would see more benefits in Q3 [68][72] Question: What changes have occurred in the organization to sustain fixed costs? - Management highlighted ongoing lab automation efforts and technology development as key strategies to maintain sustainable fixed costs [88]

Financial Data and Key Metrics Changes - In Q1 2020, Core Laboratories generated over $18.5 million in free cash flow, marking the 74th consecutive quarter of positive free cash flow [9] - The company produced an industry-leading return on invested capital (ROIC) exceeding 12% for the 42nd consecutive quarter [9] - Revenue from continuing operations was $152.4 million, down about 3% from $156.8 million in Q4 2019 [23] - Income from continuing operations, excluding items, was $13.7 million, down 20% sequentially from $17.1 million [34] Business Line Data and Key Metrics Changes - Service revenue was $110 million, down from $115.2 million, a decline of about 4.5% sequentially [24] - International revenue grew 1.5% sequentially, offset by a 9% decline in U.S. sourced revenue [25] - Product sales were $42.4 million, an increase of 2% from $41.6 million last quarter [26] - Cost of services for the quarter was 74% of service revenue, up from 72% last quarter [27] Market Data and Key Metrics Changes - Crude oil prices declined 55% in Q1 2020, leading to significant reductions in E&P companies' capital expenditure plans [45] - The average frac spread index fell by 12.5%, and completion activity declined by 24% [45] - International activity is anticipated to decrease, but not as sharply as the decline in U.S. onshore activity [48] Company Strategy and Development Direction - Core Laboratories is focusing on reducing debt with excess free cash flow and has implemented significant cost reduction plans [20][39] - The company anticipates that delays in project work and international shipments may improve during the second half of 2020 [49] - Core's reservoir description segment is expected to be more resilient due to its work not solely tied to drilling and completion activity [49] Management's Comments on Operating Environment and Future Outlook - Management expects crude oil prices to remain low in the near to mid-term due to decreased global demand [43] - The company is not in a position to provide quantitative guidance for the upcoming quarter but anticipates a modest improvement in activity as demand recovers [49] - Management highlighted that the fluid analysis business is less tied to rig count and will continue to be monitored closely [72] Other Important Information - The company reduced net debt by $6 million and maintained a leverage ratio of 1.93 as of March 31, 2020 [19] - General and administrative expenses increased to $13.1 million, primarily due to non-cash expenses associated with employee compensation plans [30] - The company expects capital expenditures to be around $11 million for 2020, down approximately 50% compared to 2019 [31] Q&A Session Summary Question: How is the dialogue progressing with international customers versus North American domestic customers? - Management indicated that international projects have not been canceled, and operations are expected to move forward once transportation issues are resolved [70] Question: How do shut-ins in the North American market impact the fluids business? - Shut-ins may initially impact fluids testing, but there could be a rebound as production resumes [72] Question: Is there a risk of revenue falling below the $100 million mark for reservoir description? - Management acknowledged that revenue could drop below $100 million due to production declines but did not provide specific guidance [75] Question: What is the company's medium-term leverage target for debt pay down? - Management indicated a target leverage ratio of around 1.5x but emphasized that the focus will remain on reducing debt for the foreseeable future [83] Question: How does the company plan to manage costs in the upcoming quarters? - Management confirmed that additional cost reduction initiatives are being formulated and will be implemented as necessary [80]

Core Laboratories N.V. (NYSE:CLB) Q4 2019 Results Conference Call January 30, 2020 8:30 AM ET Company Participants David Demshur - Chairman and CEO Chris Hill - CFO Gwen Schreffler - Head, IR Larry Bruno - President and COO Conference Call Participants Chase Mulvehill - Bank of America Sean Meakim - JP Morgan Marc Bianchi - Cowen Kurt Hallead - RBC Blake Gendron - Wolfe Research Byron Pope - Tudor, Pickering, Holt Ian Macpherson - Simmons Samantha Hoh - Evercore ISI Stephen Gengaro - Stifel Operator Good mo ...

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-------|-------|-------|-------|-------------------|-------|-------|-------|-------|------------------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Energy Conference | | | | | 9th Annual | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ...

Financial Data and Key Metrics Changes - Revenue from continuing operations was $173.2 million in Q3 2019, up 2.5% compared to the previous quarter, driven by higher activity levels on international projects [22] - Service revenue was $120.8 million, reflecting a 2% sequential increase, while product sales were $52.4 million, also up over 2% from the last quarter [22][23] - Income from continuing operations ex-items was $22.5 million, up 9% from $20.7 million in the previous quarter, with GAAP income from continuing operations at $24.2 million [27] - Earnings per diluted share from continuing operations ex-items was $0.50, up 9% from the previous quarter, while GAAP EPS was $0.54 [27] Business Line Data and Key Metrics Changes - The Reservoir Description segment saw a 9% year-over-year growth, primarily driven by international projects, while the Production Enhancement segment faced challenges due to declining U.S. onshore activity [53][38] - The introduction of new technologies, such as the ReFRAC Perforating Technology, has improved operational efficiency and client satisfaction in the Production Enhancement segment [48] Market Data and Key Metrics Changes - Global crude oil production is at an all-time high of approximately 100 million barrels per day, with U.S. production reaching 12.4 million barrels per day [15][16] - OPEC production is at an 8-year low, impacting global supply dynamics, while non-OPEC countries are expected to contribute modestly to supply growth [17][33] Company Strategy and Development Direction - The company is focused on enhancing its asset-light model to support free cash flow and dividend coverage, while continuing to streamline operations through automation [19][31] - Core Laboratories is committed to technological innovation, as evidenced by the acquisition of Guardian Global Technologies and the introduction of the GoGun system [12][19] Management's Comments on Operating Environment and Future Outlook - Management noted that the balance of supply and demand in the crude oil market remains stable, with expectations of declining global crude oil inventories supporting higher prices [34][36] - The company anticipates a decline in U.S. land activity in Q4 2019, impacting both the Production Enhancement and Reservoir Description segments, but remains optimistic about international project growth [38][39] Other Important Information - Core Laboratories generated over $20 million in free cash flow during Q3 2019, marking the 72nd consecutive quarter of positive free cash flow [19] - The company plans to maintain its dividend, emphasizing its importance to investors, particularly in Europe [19] Q&A Session Summary Question: Regarding Reservoir Description's international growth perspective for 2020 - Management indicated a positive project board with a 9% year-over-year growth in Reservoir Description, expecting mid- to high single-digit growth in 2020 [53] Question: Clarification on Q4 guidance and margin erosion - Management confirmed that margin erosion is less pronounced than in Q4 of the previous year due to cost control actions and a transitory reduction in activity [55] Question: Competitive environment for energetics and pricing - U.S. energetics revenue was down slightly by 4.3% year-over-year, but pricing remains stable as the company targets high-end operators [64][65] Question: Impact of wireline companies unbundling products - Management expressed confidence in maintaining market share despite wireline companies offering integrated systems, emphasizing the quality of their energetics [60][79] Question: Future of R&D and market expectations - Management acknowledged potential headwinds in North America but remains optimistic about international offshore revenue growth [82]

Financial Data and Key Metrics Changes - Revenue from continuing operations was $169 million in Q2 2019, comparable to the previous quarter but below the same quarter last year [18] - Service revenue was $117.9 million, down 2% sequentially, impacted by lower activity in North America [18] - Product sales were $51.2 million, up 5% from the previous quarter, led by a 18% increase in US energetic product sales [19] - Free cash flow for Q2 was $10.1 million, marking the 71st consecutive quarter of positive free cash flow [24] - GAAP income from continuing operations was $19.5 million, with earnings per diluted share at $0.43 [21] Business Line Data and Key Metrics Changes - The Reservoir Description segment is expected to benefit from increased client spending in international crude oil markets, with international revenue up 8% year-over-year [29][94] - The Production Enhancement segment saw a decline in discretionary services, which represent about a third of the segment [53] - The company anticipates that US onshore completion activity will be flat sequentially, while US energetic sales are expected to exceed the rate of completion activity [29] Market Data and Key Metrics Changes - The international offshore rig count increased by 26% year-over-year, while the overall international rig count increased by 14.5% year-over-year [27] - The decline curve is prevailing in mature crude oil fields, indicating a future supply gap [28] - The company remains bullish on crude oil, noting that non-US and non-OPEC production has fallen for seven consecutive years [14] Company Strategy and Development Direction - The company is focused on building long-term shareholder value through three financial tenets, including generating free cash flow and maintaining dividends [15] - Core Laboratories is expanding its technological capabilities, including the commissioning of the Reservoir Optimized Completions laboratory [37] - The company is reviewing divestment opportunities for non-core, low-margin businesses to streamline operations [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the international recovery and expects improved margins in the third quarter [48] - The company anticipates that free cash flow will improve in the second half of the year, driven by international activity and growth from the Reservoir Description group [72] - Management highlighted the importance of optimizing well completions to enhance field investment returns while managing capital budgets [29] Other Important Information - The company has no plans to cut its dividend, viewing it as important to its investor base [15] - The company is experiencing challenges in scaling up to meet gun demand, having turned down a $7 million order for over 13,000 guns [12] Q&A Session Summary Question: 3Q outlook for production enhancement - Management expects revenues for production enhancement to be somewhat flattish, with energetic sales outperforming due to penetration with existing and new customers [45] Question: Market share and differentiation of GoGun - Management indicated that it is still early in the introduction of GoGun, with the differentiator being the efficiency and effectiveness of the energetics [46] Question: Reservoir Description growth and EBIT margins - Management is cautious but sees potential for high-single digits growth in Reservoir Description, with EBIT margins potentially reaching 20% by year-end [48][50] Question: Discretionary services in production enhancement - Management noted a decline in discretionary services, which represent about a third of the production enhancement segment, but sees opportunities in offshore field development [53][55] Question: International growth prospects - Management ranks growth prospects with the Middle East as the top region, followed by Latin America and Asia-Pacific [58] Question: Free cash flow and dividend coverage - Management is confident that free cash flow will improve in the second half of the year, driven by international activity and growth from the Reservoir Description group [72] Question: Domestic frac market trends - Management noted that while the total number of wells might be down, revenue opportunities from increased energetic utilization in completions should remain flattish [78]

Core Laboratories N.V. (NYSE:CLB) Q1 2019 Results Earnings Conference Call April 25, 2019 8:30 AM ET Company Participants David Demshur - Chairman and CEO Chris Hill - CFO Gwen Schreffler - Head of Investor Relations Larry Bruno - President Conference Call Participants Byron Pope - Tudor, Pickering, Holt Chase Mulvehill - Bank of America Stephen Gengaro - Stifel Sean Meakim - JPMorgan Connor Lynagh - Morgan Stanley Scott Gruber - Citigroup Marc Bianchi - Cowen Kurt Hallead - RBC Operator Good day and welcom ...