Dnow, Inc. (NYSE:DNOW) Q4 2023 Earnings Conference Call February 15, 2024 9:00 AM ET Company Participants Brad Wise - IR David Cherechinsky - President & CEO Mark Johnson - SVP & CFO Conference Call Participants Nathan Jones - Stifel Jeffrey Robertson - Water Tower Research Cole Couzens - Stephens Operator Good morning. My name is Ian, and I will be your conference operator today. At this time, I would like to welcome everyone to the DNOW Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operat ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark one) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR ENDED DECEMBER 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 001-36325 DNOW INC. (Exact name of registrant as specified in its charter) Delaware 46-4191184 (State of Incorporation) (IRS Identification No.) 7402 North Eldridge Parkway, Hous ...

HOUSTON--(BUSINESS WIRE)--DNOW Inc. (NYSE: DNOW) announced today it has entered into an agreement to acquire Whitco Supply, LLC in an all-cash transaction, subject to regulatory approvals and other customary closing conditions. David Cherechinsky, President and CEO of DNOW, added, “ The acquisition of Whitco Supply aligns with our strategic objectives to diversify end-markets and is the result of our patient, disciplined approach to capital allocation. This transaction enhances our earnings and free cash f ...

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Financial Data and Key Metrics Changes - Total revenue for Q3 2023 was $588 million, down $6 million or 1% from Q2 2023, but up $11 million or 2% year-over-year [50][70] - EBITDA for Q3 2023 was $46 million, or 7.8% of revenue, with year-to-date EBITDA at $140 million, or 7.9% of revenue [50][45] - Net income attributable to NOW Inc. for Q3 was $35 million, or $0.32 per fully diluted share, while non-GAAP net income was $28 million, or $0.25 per fully diluted share [51][52] - Cash position at the end of Q3 was $194 million, with total liquidity of $547 million [10][52] Business Line Data and Key Metrics Changes - The US Process Solutions business grew to a record 30% of the US segment in Q3, driven by high demand for various equipment [5] - Canada revenues were $68 million for the quarter, a 3% sequential increase, but lower than expected due to market disruptions [6][9] - DigitalNOW revenue as a percentage of total SAP revenue was 46% in Q3, down from 48% in Q2 2023 [7] Market Data and Key Metrics Changes - International revenue for Q3 was $72 million, flat sequentially but up 29% year-over-year [9] - US revenue for Q3 totaled $448 million, a decrease of $8 million or 2% sequentially, despite a 10% decline in US rig counts [50][45] Company Strategy and Development Direction - The company is focused on maximizing shareholder value, leveraging a debt-free balance sheet, and pursuing margin-accretive acquisitions [13][49] - The strategy includes expanding into carbon capture and renewable natural gas markets, with significant growth opportunities identified [40][92] - The company is transitioning to the DNOW brand to better communicate its vision and enhance market presence [79] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in revenue retention despite a declining rig count, indicating a strong market position [15] - The company expects a seasonal slowdown in Q4 due to customer budget exhaustion and fewer business days [39][53] - Full-year revenue growth is anticipated to be approximately 8%, despite challenges in the US rig count [53][80] Other Important Information - The company repurchased $5 million worth of shares in Q3, with cumulative repurchases totaling $56 million out of an authorized $80 million [49][52] - The effective tax rate for Q3 was 5.4% on a GAAP basis, with a non-GAAP effective tax rate of approximately 26% [76] Q&A Session Summary Question: Expectations for rig growth in 2024 - Management noted that there is speculation about growth in rig counts as customers are expected to reset budgets and add rigs [82] Question: Acquisition opportunities to support Process Solutions business - Management confirmed they are looking for acquisitions that provide exclusivity in territories and enhance margins [23] Question: Customer conversations regarding energy evolution projects - Management indicated that most growth opportunities will come from existing customers investing in energy transition projects [63][88]

DNOW. Energy Delivered." Statements made in the course of this presentation that state the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. It is important to note that the Company's actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained f ...

Financial Performance - For the three months ended September 30, 2023, the company generated net income of $35 million on revenue of $588 million, representing a revenue increase of $11 million or 1.9% compared to the same period in 2022[82]. - For the nine months ended September 30, 2023, net income attributable to the company was $100 million on revenue of $1,766 million, reflecting an increase in revenue of $177 million or 11.1% year-over-year[82]. - The company reported an operating profit of $37 million for the three months and $108 million for the nine months ended September 30, 2023, compared to $44 million and $96 million for the same periods in 2022, respectively[83]. - Total revenue for the three months ended September 30, 2023, was $588 million, an increase of $11 million or 1.9% compared to $577 million in the same period of 2022[86]. - U.S. revenue for the three months ended September 30, 2023, was $448 million, up $13 million or 3.0% from $435 million in 2022, driven by acquisitions[87]. - Canada revenue decreased by $18 million or 20.9% to $68 million for the three months ended September 30, 2023, primarily due to a decrease in rig count[89]. - International revenue increased by $16 million or 28.6% to $72 million for the three months ended September 30, 2023, driven by stronger project activity[91]. - Total operating profit for the three months ended September 30, 2023, was $37 million, a decrease of $7 million or 15.9% compared to $44 million in 2022[86]. - U.S. operating profit for the three months ended September 30, 2023, was $29 million, down $2 million from $31 million in 2022, primarily due to decreased product margins[88]. - Canada generated an operating profit of $6 million for the three months ended September 30, 2023, a decline of $4 million from $10 million in 2022[90]. - International segment operating profit was $2 million for the three months ended September 30, 2023, a decrease of $1 million from $3 million in 2022[92]. Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2023, was $83 million, compared to a cash outflow of $6 million in the same period of 2022[106]. - Net cash used in investing activities for the nine months ended September 30, 2023, was $47 million, primarily related to business acquisitions of approximately $33 million[107]. - The company intends to pursue additional acquisition candidates, funding future cash acquisitions primarily with cash on hand, cash flow from operations, and the revolving credit facility[110]. - The share repurchase program approved on August 3, 2022, allows for the purchase of up to $80 million of common stock through December 31, 2024; as of September 30, 2023, $49 million worth of shares have been repurchased, with approximately $24 million remaining[111]. Market Conditions and Outlook - The average price of West Texas Intermediate Crude was $82.30 per barrel in Q3 2023, down 11.7% from $93.18 in Q3 2022, while natural gas prices fell 67.6% to $2.59 per MMBtu from $7.99[77]. - The worldwide active drilling rig count decreased by 0.4% to 1,790 rigs in Q3 2023 compared to Q2 2023, with the U.S. rig count declining by 9.8% to 651 rigs[79]. - The company expects oil and gas demand to grow over the next several years, despite recent volatility in commodity prices due to geopolitical instability and economic uncertainty[84]. - The company aims to support energy evolution investments by expanding its product and solution offerings to meet changing customer requirements[85]. Global Operations - The company operates through three reportable segments: U.S., Canada, and International, with approximately 110 locations in the U.S. and 40 in Canada[70][73]. - The company has a global presence with operations in approximately 20 countries and serves customers in about 80 countries, enhancing its value proposition[66]. Currency and Commodity Sensitivity - For the nine months ended September 30, 2023, approximately 25% of net sales were generated outside the U.S., exposing the company to foreign currency exchange rate fluctuations[116]. - The average foreign exchange rate for the first nine months of 2023 decreased by approximately 4% compared to the same period in 2022, with the Canadian dollar, British pound, and Australian dollar decreasing by approximately 5%, 1%, and 5% respectively[120]. - A hypothetical 10% change in foreign currency rates would have resulted in a $2 million change in net income for the nine months ended September 30, 2023[121]. - The company reported foreign currency transaction losses of $1 million for both the nine months ended September 30, 2023, and 2022, primarily due to exchange rate fluctuations[118]. - The company is sensitive to steel prices, which can impact product pricing, particularly steel tubular prices[122].

NOW, Inc. (NYSE:DNOW) Q2 2023 Earnings Conference Call August 2, 2023 9:00 AM ET Company Participants Brad Wise - vice President-Digital Strategy and Investor Relations David Cherechinsky - President and Chief Executive Officer and Director Mark Johnson - Senior Vice President and Chief Financial Officer Conference Call Participants Adam Farley - Stifel Financial Corp. Jeff Robertson - Water Tower Research Douglas Becker - Capital One Financial Operator Good morning. My name is Chris, and I'll be your confe ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-36325 NOW INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identificatio ...

NOW Inc. (NYSE:DNOW) Q1 2023 Earnings Conference Call May 4, 2023 9:00 AM ET Company Participants Brad Wise - VP of Digital Strategy and IR David Cherechinsky - President and CEO Mark Johnson - SVP and CFO Conference Call Participants Thomas Moll - Stephens Inc. Douglas Becker - Capital One Adam Farley - Stifel Jeffrey Robertson - Water Tower Research Operator Good morning, afternoon, evening. My name is Bhavesh, and I'll be your conference operator today. At this time, I would like to welcome everyone to ...